Alabama Medicaid Eligibility Summary

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2 Alabama Medicaid Eligibility Summary ELIGIBLE INDIVIDUALS During Fiscal Year 2008, more than 920,000 Alabama citizens were eligible for Medicaid benefits for at least one month of the year. To be eligible for federal funds, states are required to provide coverage for certain groups. These groups are: Low income families who meet the eligibility requirements in the state s AFDC plan In effect on July 16, 1996; Supplemental Security Income (SSI) recipients; Infants born to Medicaid-eligible pregnant women; Children under age 6 and pregnant women whose family income is at or below 133 percent of the federal poverty level Children ages 6-18 whose family income is up to 100 percent of the federal poverty level Recipients of adoption assistance Children in foster care or custody of Dept. of Youth Services Certain Medicare beneficiaries Special protected groups, including those who lose eligibility for cash assistance or SSI due to an increase in earnings from work, Social Security benefits or child/spousal support APPLYING FOR MEDICAID Eligibility for Medicaid in Alabama is currently determined by four agencies. The agencies and the groups they certify are: The Social Security Administration (SSA) Aged, blind or disabled individuals through Supplemental Security Income (SSI) program The Alabama Department of Human Resources Foster Children Children who receive State or Federal Adoption Assistance Catholic Social Services Refugees through Refugee Resettlement Program The Alabama Medicaid Agency Elderly & Disabled Programs Individuals eligible for Medicaid for Low Income Families (MLIF) Pregnant women, and children under age 19 (SOBRA) program Plan First (Family Planning) Program Breast and Cervical Cancer Program Emergency Services for Aliens QUALIFYING FOR MEDICAID To qualify for Medicaid, all individuals must: Be living in Alabama Be a U.S. citizen or be in this country legally Meet income and age requirements (varies according to program) Those individuals applying for assistance through a program for the elderly or disabled must also: Meet certain medical criteria Have resources below a certain limit (varies according to program) For pregnant women, the pregnancy must be medically verified.

3 INCOME AND RESOURCES Many Medicaid programs have specific requirements regarding the maximum income and resources an applicant may have and still qualify for coverage. The rules vary among programs and the information below is offered as a general guide. Applicants will need to find out the specific requirements for each program. Income means money that an individual receives. The maximum income allowed varies depending on the program. Some examples of income are: Wages, salaries, tips Dividends and interest Unemployment compensation Social Security Child support or alimony Pensions or Retirements Veterans Benefits (less Aid and Attendant Care and Continuing Medical Expenses) Lump Sum Distribution Note: SSI and welfare checks do not count as income. Resources are money or other assets owned by an individual. The maximum amount of resources allowed varies depending on the program. Some examples of resources are: Cash Cash surrender value of life insurance when face value of all policies is over $1,500 ($5,000 for institutionalized individuals) Bank and credit union accounts, e.g. checking, savings, certificates of deposit, safe deposit box Loans Mineral and Timber Rights Property Mutual Funds Promissory Notes Stocks and Bonds Annuities Some resources are generally not counted when applying for Medicaid. These include: Household goods and certain personal effects if the value is less than a certain amount (varies according to program) Life insurance (or any insurance with a cash surrender value) if total combined face value is below a certain amount (varies according to program) Burial fund or prepaid burial contract of up to a certain amount (varies according to program) Burial space items such as a casket, vault, burial plot, marker, opening/closing of grave. One automobile (value depends on how it is used) In the case of institutional Medicaid applicants, property may not be counted as a resource if: The applicant intends to return home from the medical institution If a bona fide effort is being made to sell the property If a spouse, other dependent relative or joint owner is living on the property The property, valued less than $6,000, is income producing If the property interest is a life estate There are special provisions for individuals who remain in the home/community after a spouse has been institutionalized. The Medicaid District Office staff will assist applicants when this occurs.

4 Medicaid Income Limits for 2009 To qualify for Medicaid through SSI the income limit for an aged, blind or disabled individual cannot exceed $694 per month or $1,031 for a couple. In addition, resource limits apply. For an individual the resources cannot exceed $2,000 per month or $3,000 per month for a couple. Some examples of resources are: cash, money in checking and savings accounts, loans, promissory notes, stocks, bonds, time deposits (certificates of deposit, annuities, etc), mutual funds, mineral and timber rights, real estate, etc. Individuals must apply with the Social Security Administration for the SSI (Supplemental Security Income) Program. Nursing Home (Institutionalized) Medicaid: The Medicaid income limit for individuals eligible for the Nursing Home (institutional) program is $2,022 per month. The resource limit is $2,000 as of the first day of the month Medicaid for the Elderly and Disabled Home and Community Based Waivers: The income limits for these waivers are as follows: Elderly and Disabled Waiver is $2,022 per month. Independent Living Waiver is $2,022 per month. Mental Retardation Waiver is $2,022 per month. HIV/AIDS Waiver is $2,022 per month. Living at Home Waiver is $694 per month. (Persons must be receiving SSI.) Technology Assisted Waiver is $2,022 per month. The resource limit for these waivers is $2,000 per month. QMB or Qualified Medicare Beneficiary*: Income cannot exceed $887 per month for an individual. Income cannot exceed $1,187 per month for a couple. SLMB or Specified Low Income Medicare Beneficiary*: Income cannot exceed $1,060 per month for an individual. Income cannot exceed $1,420 per month for a couple. QI-1 or Qualified Individual*: Income cannot exceed $1,190 per month for an individual. Income cannot exceed $1,595 per month for a couple. No new applications are being accepted for the QI-1 program at this time. *Income limits for the QMB, SLMB and QI-1 programs will be updated when the 2009 Federal Poverty Level is published. NOTE: The resource limits do not apply for these Medicare related programs. If both spouses are on Medicare, their combined income cannot exceed the couple income limit. If only one spouse has Medicare, then the Medicare spouse who is applying can have income of no more that the individual limit and the income of both spouses combined can be no more than the couple limit.

5 SOBRA Medicaid (Pregnant Women and Children under 6 years of age) - 133% of federal poverty level*: Income after deductions cannot exceed $1,153 per month for a family of 1 Income after deductions cannot exceed $1,552 per month for a family of 2 Income after deductions cannot exceed $1,951 per month for a family of 3 Income after deductions cannot exceed $2,350 per month for a family of 4 SOBRA Medicaid (Children 6 to 19 years of age) 100% of federal poverty level*: Income after deductions cannot exceed $867 per month for a family of 1 Income after deductions cannot exceed $1,167 per month for a family of 2 Income after deductions cannot exceed $1,467 per month for a family of 3 Income after deductions cannot exceed $1,767 per month for a family of 4 *Income limits for the SOBRA programs will be updated when the 2009 Federal Poverty Level is published. Medicaid for Low Income Families: Income after deductions cannot exceed $111 per month for a family of 1 Income after deductions cannot exceed $137 per month for a family of 2 Income after deductions cannot exceed $164 per month for a family of 3 Income after deductions cannot exceed $194 per month for a family of 4 (Please see the eligibility requirements for SOBRA/MLIF (Medicaid for Low Income Families handout for family sizes over 4.) NOTE: Certain deductions, such as $90 work deduction per wage earner, dependent care costs and $50 per household for child support received, may be deducted from the gross income to determine the net income amount for the SOBRA and MLIF programs. (Revised 12/2008)

6 Medicaid for the Elderly and Disabled The Alabama Medicaid Agency has a number of programs for the elderly and disabled. Medicaid for Institutional care is for people in nursing homes, hospitals, and ICF-MR facilities. Home and Community Based Waivers are for people who are elderly, disabled, homebound, mentally retarded, or who have certain diagnoses and who live in the community. SSI Related Medicaid programs are for people who no longer receive Supplemental Security Income (SSI) payments, but have their Medicaid benefits protected under certain laws. To be eligible for the Medicaid programs listed above, you must: * Be living in Alabama, * Be a U.S. citizen (You must provide proof of citizenship and identity unless you have been approved for Medicare or SSI.), or Be in satisfactory immigration status (You must provide proof of immigrant status.), * Meet certain medical criteria, * Have a monthly income below a certain limit, and * Have resources below a certain limit. NOTE: Eligibility for Home and Community Based Waivers (page 5) depends on the availability of slots from the administering agency. Nursing Home, Hospital, and ICF-MR Medicaid for an Individual: Medical Approval. An applicant must be medically approved by Medicaid or Medicare for the nursing facility to be paid. The nursing facility must submit the medical information to Medicaid. An applicant for Nursing Home, Hospital, or ICF-MR Medicaid must also be a resident of an approved medical institution for at least 30 continuous days to be eligible for Medicaid payments. (The exception is an SSI recipient.) Income Limit. The income limit for Nursing Home, Hospital, or ICF-MR Medicaid is $2,022 per month for an individual. (This income limit changes each January.) Some examples of income are: Black Lung Social Security Railroad Retirement Federal Civil Service

7 Examples of income (continued): Veterans Benefits (less Aid and Attendant Care, and Continuing Medical Expenses) Private Pensions or Retirements SSI and welfare checks do not count as income. Excess Income. If you are applying for Medicaid in a nursing home and have excess income, you have the option to establish a Qualifying Income Trust (QIT). The establishment of this trust, establishing the trust bank account, and the deposit of an income source to a corresponding trust account allows Medicaid to disregard that income in that month for the purpose of determining eligibility. Medicaid has strict criteria for the establishment of an acceptable QIT. Contact the Medicaid District Office for a QIT packet or to download a packet, visit our website, If you feel you need legal advice on setting up a QIT, contact a private attorney or call the local Area Agency on Aging at for a referral. The trust document, proof of establishment of the trust bank account, and verification of the deposit of an income source to the trust account should be submitted with the nursing home application. Resource limit. The resource limit for Nursing Home, Hospital, and ICF-MR Medicaid, as of the first day of each month, is $2,000. Special rules apply for an individual in a medical institution with a spouse at home. See Page 4 of this handout for information as to how Medicaid treats income and resources for a married couple. Some examples of resources are: Cash Mortgages Cash surrender value of life Mutual Funds insurance when face value of Promissory Notes all policies exceeds $5,000 Real Estate Checking and Savings Stocks and Bonds Loans Time Deposits (Certificates of Mineral and Timber Rights, etc. Deposit, Annuities, etc.) Some resources do not count toward the $2,000 resource limit, they are: 1. Household goods and personal effects. 2. Life insurance (or any insurance with a cash surrender value), if the total combined face value is $5,000 or less.

8 3. Burial fund or prepaid burial contract of up to $5,000. (The amount excluded is reduced by the face value of life insurance excluded in #2 above. The District Office will have to have copies of the fund or contract.) 4. Burial space items (casket, vault, burial plot, marker, opening and closing of grave). 5. One automobile per household, if used by the household member. 6. Property may not be counted as a resource in the following situations: a. Intent to return home from the medical institution, b. A bona fide effort is being made to sell the property, c. If a spouse, other dependent relative, or joint owner is living on the property, d. The property, valued less than $6,000, is income producing, e. If the property interest is a life estate. NOTE: A lien may be required. All property information such as deeds, wills, etc. will need to be submitted to the Medicaid District Office for review. Excess Resources. The resource limit for Nursing Home, Hospital, and ICF-MR Medicaid is $2,000 before the first day of the month. This means that in order to be eligible for Medicaid you must not have more than $2,000 in resources on the first day of any given month. To keep from going over the $2,000 limit: * If you owe money to the nursing home, pay it before the first of the month. * Pay any of your bills that are due before the first of the month. * Do not let anyone else deposit money into your bank account to help pay your bills. It may be counted as income in the month of the deposit and a countable resource the following month. * If you get a Social Security check or other pension check and it is left in your bank account at the beginning of the next month, it is counted as a resource. * If you have a life insurance or a burial contract for more than the limit, the amount over the limit will be counted as a resource. Remember, if you have resources in excess of $2,000 on the first day of the month, you will NOT be eligible for Medicaid that month.

9 Disposal of Resources. You may not be eligible for Institutional Medicaid if you sold (for less than fair market value), gave away or transferred any resource(s) that you or your spouse owned. Nursing Home, Hospital, and ICF-MR Medicaid for a married couple: If a couple is legally married and one spouse is a patient in a medical institution (institutionalized spouse) while the other spouse remains in the community (community spouse), special rules apply for Nursing Home, Hospital, and ICF-MR Medicaid. Some or all of the assets of the couple may be protected for the community spouse. In addition, some of the income of the institutional spouse may be allocated to the community spouse. Income Allocation for the Community Spouse. In order to receive a portion of the institutionalized spouse s income, the community spouse cannot have more than $1,750 per month. (This income allocation amount changes each July.) If the community spouse has gross income at or above $1,750, no additional income can be allocated from the institutionalized spouse to the community spouse. If the community spouse has gross (before anything is taken out) monthly income that is less than $1,750 per month, the institutionalized spouse may allocate income to the community spouse. Resource Assessment for the Community Spouse. When someone enters the nursing home and their spouse remains in the community, an assessment of the combined assets (resources) is done by the Medicaid District Office. The Medicaid worker will ask for proof of all assets owned by the couple, either solely or jointly, as of the date the institutionalized spouse entered a medical institution. (Some of the same resource exclusions apply as mentioned earlier in this handout. The home will not be counted as long as the spouse lives in the home.) The value of all countable assets will be added together. The amount that can be protected for the community spouse will be determined by the Medicaid District Office. If the total value of the couple s countable assets is $27,000 or less, spend down of the assets for the institutionalized spouse will not be required. If the combined countable assets are more than $27,000, some of the assets must be spent on the institutionalized spouse before he or she will be eligible for Medicaid assistance. (The Medicaid District Office will determine the amount of assets to be spent down.) If the value of the combined countable assets is more than $50,000, but less than $219,120, one half of the assets will be protected for the community spouse. The other half will be counted to the institutionalized spouse, who will not be eligible for Medicaid until his or her share of the assets is spent down to $2,000 before the first day of a month.

10 The maximum value of the countable assets that can be protected for the community spouse is $109,560. The couple must have $219,120 or more on hand as of the date the institutionalized spouse entered a medical institution in order to allow the maximum amount to be kept by the community spouse. Home and Community Based Waivers: The waivers under Home and Community Based Waiver Program are Elderly and Disabled, State of Alabama Independent Living (SAIL), Mentally Retarded (MR), HIV/AIDS, Technology Assisted (TA) and Living at Home. For detailed information about the level of care requirements and the type of services that are provided in each waiver see the Home and Community Based Waivers handout. Medical Approval. An applicant for Home and Community Based Waivers must be medically approved by Medicaid or Medicare. Income limits. Elderly and Disabled Waiver - - $2,022 per month Independent Living Waiver $2,022 per month Mentally Retarded Waiver $2,022 per month HIV/AIDS Waiver $2,022 per month Technology Assisted Waiver - - $2,022 per month Living at Home Waiver $694 per month (These income limits change each January.) Resource limits. The resource limit for Home and Community Based Waivers is $2,000 for an individual. Spousal impoverishment rules do not apply to waivers. Income and resources of the spouse do not apply to waivers. To apply for the Elderly & Disabled Waiver contact your local Area Agency on Aging at or your local Department of Public Health in your county of residence. For the State of Alabama Independent Living Waiver contact your local Department of Rehabilitation Services or call For the Mentally Retarded Waiver contact your local Department of Mental Health or call For the HIV/ AIDS Waiver contact the local Department of Public Health in your county of residence or call For the Technology Assisted Waiver contact the Department of Rehabilitation Services at For the Living at Home Waiver contact the Department of Mental Health at Limited funds and slots are available for these waivers.

11 Qualified Disabled Working Individuals (QDWI) Program. This program can pay the Medicare Part A premiums for certain disabled individuals who lose Medicare coverage because of work. Individuals are notified by the Social Security Administration if they may be eligible for this program. Income Limits. The income limit is $1,754 per month for an individual and $2,354 for a couple. (This income limit changes each February.) Resource limits. The resource limit for the Qualified Disabled Working Individuals Program is $4,000 for an individual. SSI Related Medicaid: Income limits. All SSI Related programs, such as Widow/Widower, Disabled Adult Child (DAC), Retroactive SSI, and Continuous (Pickle) Medicaid have an income limit that equals the Federal Benefit Rate (FBR) plus $20 per month. The income limit for SSI Related Medicaid is $674 for an individual and $1,011 for a couple. (This income limit changes each January.) NOTE: The couple income limit applies only if both are eligible, unless the ineligible spouse s income and resources are deemed (which means counting a portion of the income and resources) to the applicant. If only one person is eligible, the individual income limit applies. In the Widow/Widower, DAC and Continuous cases, if the applicant otherwise qualifies, some income is not counted against the limit, such as Widow/Widower benefits, Child s benefits, or Social Security cost-of-living increases. Resource limits. The resource limit for SSI Related Medicaid is $2,000. Some resources do not count toward the $2,000 resource limit, they are: 1. Household goods and personal effects. 2. Life insurance (or any insurance with a cash surrender value), if the total combined face value is $1,500 or less. 3. Burial fund or prepaid burial contract of up to $1,500. (The amount excluded is reduced by life insurance. The District Office will have to have copies of the fund or contract.)

12 4. Burial space items (casket, vault, burial plot, marker, opening and closing of grave). 5. One automobile per household, if used by household member. Please note: You must apply for and agree to accept any income from annuities, pensions, retirement, disability benefits, or other income to which you are entitled. Applying for these benefits is a condition of eligibility for Medicaid and failure to apply could keep you from having Medicaid eligibility. For Veterans or Veteran s Dependents: If you receive or are eligible to receive VA benefits, you must apply for the maximum benefit available. The amount you receive varies depending on the type of benefit. Rather than increase, some VA benefits are dropped to $90 while you are in a nursing home. You should contact VA to determine how your benefit will be affected while you are in the nursing home.

13 Some Things You Need to Know When Submitting an Application Submitting an Application: Complete the application to the best of your ability. The application must be completed and signed in ink, not pencil. Make sure the applicant s Name, Social Security Number, and Medicare Number are correct. If you have ever been married, include the Spouse s Name, SS# and VA Claim number. Send the application to the appropriate District Office (see the back page of the application). A Medicaid Specialist will contact you for an interview after the application arrives in the District Office. It will be helpful if you include as many of the following items as possible when you submit the application: 1. Copies of Medicare and Social Security cards. 2. Verification of the gross (before anything is taken out) amount of Social Security, Veterans Administration, Railroad Retirement, Civil Service checks, private pension checks, rental income and annuities. (Verification should include claim and/or identification numbers.) 3. Copies of the last three bank statements (all accounts). (Once the Medicaid Eligibility Specialist reviews the case, he or she may have to ask for additional bank statements.) 4. Verification of CDs, IRAs and Savings Bonds. 5. Verification of stocks, bonds and mutual funds. 6. Copies of deeds to property currently owned. (This includes heir property, life estate, etc.) Also, purchase and sale deeds to property which has been sold or transferred within the past five (5) years. 7. Copies of trusts, mortgages, loans, and promissory notes. 8. Copies of all insurance policies, including: a. Life, burial, funeral, vault, casket, cash, term and/or group. b. Long Term Care policies. c. Health, hospital, and/or cancer policies. (A copy of the card or premium notice and copy of payment method is needed.) 9. Copies of pre-need/prearranged burial contracts, including an itemized list of charges. 10. Verification of gross (before anything is taken out) wages. 11. Copy of power of attorney, guardianship papers, or curator papers. Always keep a copy of the original application you submit to Medicaid. Send copies of all other documents, do not send your original documents except for proof of citizenship or identity, if required. Proof of citizenship and identity is not needed if you are currently receiving SSI benefits or are entitled to or enrolled in Medicare.

14 If additional information is requested, make sure you supply the information as soon as possible. If you have questions about the information requested, call the Medicaid Eligibility Specialist. If you need assistance in getting the information requested, see if the nursing home social service staff or business office worker is willing to assist. Some things that can make a claimant ineligible: If someone else (a family member) deposits money (income) into the claimant s bank account, this is considered a contribution and must be budgeted as income to the claimant, which may make the claimant ineligible.. If the claimant s countable resources exceed $2,000 on the first day of the month, the claimant will be ineligible. (An example would be if the claimant receives their June check in May, Medicaid will not count the June check as a resource for May. Medicaid will count the June check as income for June. However, if the claimant s monthly income is allowed to accumulate and the countable resources exceed $2,000, the claimant will be ineligible.) Transfers of assets/resources may affect eligibility. For the institutionalized claimant the transfer of assets/resources by claimant or claimant s spouse could cause the claimant to be ineligible for nursing home payment. For waiver Medicaid programs the transfer of assets/resources could cause the claimant to be totally ineligible for Medicaid. If an application is denied, there may be some things that the claimant can do to become eligible: 1. Spend-Down of Money. Medicaid looks at resources on the first moment of the first day of the month. The countable resource limit for an individual is $2,000. If the total value of the couple s countable assets is $27,000 or less, spend down of the assets for the institutionalized spouse will not be required. Monies can be spent down, however, the claimant s money is to be spent for the claimant s needs and/or expenses, not the community spouse. 2. Excess Income. If the claimant has excess income, a Qualified Income Trust may need to be established. [Qualifying Income Trust (QIT) packets are now available at the Medicaid District Office or to download a packet, visit our website, QITs are necessary when a claimant s income exceeds the Medicaid income limit. (If you receive VA or State of Alabama retirement, talk with the Medicaid Eligibility Specialist before establishing a QIT.)]

15 3. Excess Resources. If excess resources exist, you need to discuss burial exclusions and make sure that excess resources are spent for the needs of the claimant in a timely and efficient manner. [Medicaid looks at countable resources as of the first moment of the first day of the month. It is the sponsor s responsibility to reapply in a timely manner. Make sure that you keep accurate records (bank statements, cancelled checks, receipts, etc.) to show how the money of the claimant has been spent.] The Award Process: When the application investigation has been completed, an award notice will be mailed indicating an eligibility date and a liability amount. The liability amount is the amount that the claimant is to pay the nursing home each month for room and board. The nursing home will bill Medicaid for the difference. The liability is calculated by subtracting the following from the claimant s monthly gross income: * Personal Needs ($30.00) or VA ($120.00, if VA check reduced to $90.00), * Allocation to Community Spouse (if the nursing home applicant has a spouse who resides in the community, we can allocate a certain amount of the claimant s monthly income to the spouse in the community), * Allocation to family members, * Health Insurance Premiums (verified as being paid with claimant s money). The Annual Review Process: Once a claimant has been approved for Medicaid, a review of the claimant s financial circumstances will be conducted annually. This means that one year from the date of the award notice, an annual review form will be mailed to the sponsor. It is very important that the sponsor complete the form as soon as possible and return it, along with any requested information. Make sure the review form is signed, all the questions are answered and the requested information is enclosed. You have ten (10) days to complete and return the form. If the form is not returned, along with the requested information, the active Medicaid case will be terminated. Between Annual Reviews: It is the responsibility of the claimant or sponsor to report any financial changes to their Medicaid Eligibility Specialist within ten (10) days of the change. Examples of changes are: if claimant receives an increase in benefits or money from another source, if claimant returns home, if the sponsor changes his or her address, etc. (If you are not sure if you should report a change, contact your Medicaid Eligibility Specialist.)

16 Medicaid District Offices for Elderly and Disabled Cases Address Telephone Number Counties served Auburn-Opelika District Office Bullock Lee Russell 1716 Catherine Court, Suite 1-A (FAX) Chambers Macon Talladega Auburn, AL Clay Randolph Tallapoosa Coosa Birmingham District Office Jefferson St. Clair 468 Palisades Blvd (FAX) Birmingham, AL Decatur District Office Cullman Madison 2119 Westmeade Dr., S.W., Suite (FAX) Jackson Morgan Decatur, AL Dothan District Office Barbour Crenshaw Houston 2652 Fortner Street, Suite (FAX) Coffee Dale Pike Dothan, AL Conecuh Geneva Covington Henry Florence District Office Colbert Lawrence Marion 214 E. College Street (FAX) Franklin Limestone Winston Florence, AL Lauderdale Gadsden District Office Blount Cleburne Marshall 200 West Meighan Blvd., Suite D (FAX) Calhoun Dekalb Gadsden, AL Cherokee Etowah Mobile District Office Baldwin Mobile Suite B 100 B (FAX) Escambia Washington 3280 Dauphin Street Mobile, AL Montgomery District Office Elmore Montgomery 501 Dexter Avenue (FAX) (P.O. Box 5624, Zip ) Montgomery, AL Selma District Office Autauga Clarke Monroe 106 Executive Park Lane (FAX) Butler Dallas Perry Selma, AL Chilton Lowndes Wilcox Choctaw Marengo Tuscaloosa District Office Bibb Lamar Sumter nd Avenue (FAX) Fayette Pickens Tuscaloosa Tuscaloosa, AL Greene Shelby Walker Hale 09/2008

17 A Medicaid Primer Alabama Medicaid Agency January, 2009

18 A Medicaid Eligibility Primer Alabama Medicaid Agency 1. What is Medicaid? Title XIX of the Social Security Act (SSA) is a program that provides medical assistance for certain individuals and families with low income and resources. The program, known as Medicaid, became law in Medicaid is the largest program providing medical and healthrelated services to Alabama's poorest people. 2. Who Determines Eligibility for Medicaid Benefits in Alabama? There are three agencies in Alabama that certify individuals for Medicaid. These agencies certify certain groups of individuals for Medicaid based on their circumstances. These agencies are: The Social Security Administration, The Department of Human Resources, and The Alabama Medicaid Agency. The Social Security Administration certifies individuals for the following programs: Low income individuals who are aged, blind, or disabled may qualify for cash assistance through the Supplemental Security Income (SSI) program. Individuals eligible for SSI are automatically eligible for Medicaid. You may hear someone say Alabama is a Section 1634 state. That means that we accept Social Security Administration's eligibility determination for this group. The Department of Human Resources certifies individuals for the following programs: Foster children and children who receive State or Federal Adoption Assistance. The Alabama Medicaid Agency certifies individuals for the following programs: Pregnant women and children under age 19. Pregnant women and children under age 19 in families with income below certain limits. Applicants should contact their local SOBRA Medicaid eligibility worker located in Health Departments and some hospitals. NOTE: Some pregnant women receive pregnancy-related services only. Plan First Program. Women who are years of age and whose income is below a certain limit. NOTE: These women receive family planning services only. You may call 1 (888) for more information. Breast and Cervical Cancer Program. Women under age 65 who have been screened Cancer Early Detection Program and diagnosed with breast or cervical cancer may be eligible for this program. Call 1 (877) Nursing home and institutional level of care. Medicaid District Offices certify eligibility for nursing home care, home and community based waiver services (elderly and disabled, SAIL, HIV, Living at Home, Technology Assisted, and mentally retarded, and post extended hospital days. SSI related groups. Widow/Widower, Disabled Adult Child, Retroactive SSI, Continuous (PICKLE), Grandfathered Children. Medicare related groups. (Qualified Medicare Beneficiary, Specified Low-Income Medicare Beneficiaries, Qualifying Income groups, and Qualified Disabled Working Individuals). Emergency services for aliens- certain aliens may receive emergency services.

19 Medicaid for Low Income Families Program-Families with children under the age of 19 who qualify for MLIF in the household may apply. 3. Who Receives Mandatory Medicaid Benefits? During FY 2008, 920,937 individuals were eligible for Medicaid benefits. States have some discretion in determining which groups their Medicaid programs will cover and the financial criteria for Medicaid eligibility. To be eligible for federal funds, states are required to provide Medicaid coverage for most people who get federally assisted income maintenance payments, as well as for related groups not getting cash payments. Some examples of the mandatory Medicaid eligibility groups include the following: Limited income families with children, as described in Section 1931 of the Social Security Act, who meet the eligibility requirements in the State's AFDC plan in effect on July 16, This group is referred to as MLIF. Supplemental Security Income (SSI) recipients (or in States using more restrictive criteria--aged, blind, and disabled individuals who meet criteria which are more restrictive than those of the SSI program and which were in place in the State's approved Medicaid plan as of January 1, 1972); Infants born to Medicaid-eligible pregnant women. Medicaid eligibility must continue throughout the first year of life so long as the infant remains in the mother's household and she remains eligible, or would be eligible if she were still pregnant; Children under age 6 and pregnant women whose family income is at or below 133 percent of the Federal poverty level and children under age 19 up to 100% of poverty. (The minimum mandatory income level for pregnant women and infants in certain States may be higher than 133%, if as of certain dates the State had established a higher percentage for covering those groups.) States are required to extend Medicaid eligibility until age 19 to all children born after September 30, 1983 (or such earlier date as the State may choose) in families with incomes at or below the federal poverty level. Once eligibility is established, pregnant women remain eligible for Medicaid through the end of the calendar month in which the 60th day after the end of the pregnancy falls, regardless of any change in family income. States are not required to have a resource test for these poverty level related groups. However, any resource test imposed can be no more restrictive than that of the AFDC program for infants and children and the SSI program for pregnant women; Recipients of adoption assistance and foster care under Title IV-E of the Social Security Act; Certain people with Medicare; and Special protected groups who may keep Medicaid for a period of time. Some examples include persons who lose SSI payments due to earnings from work or increased Social Security benefits; and families who are provided 6 to 12 months of Medicaid coverage following loss of eligibility under Section 1931 (MLIF) due to earnings, or 4 months of Medicaid coverage following loss of eligibility under Section 1931 due to an increase in child or spousal support.

20 4. Which Optional Beneficiary Groups May Receive Medicaid Benefits? States also have the option to provide Medicaid coverage for other "categorically needy" groups. These optional groups share characteristics of the mandatory groups, but the eligibility criteria are somewhat more liberally defined. Examples of the optional groups that States may cover as categorically needy (and for which they will get federal matching funds) under the Medicaid program include the following: infants up to age one and pregnant women not covered under the mandatory rules whose family income is below 185 percent of the Federal poverty level (the percentage to be set by each State); (Alabama does not utilize this option) optional targeted low income children; (AL does not utilize this option) certain aged, blind, or disabled adults who have incomes above those requiring mandatory coverage, but below the Federal poverty level; (AL does not utilize this option) children under age 21 who meet income and resources requirements for AFDC, but who otherwise are not eligible for AFDC; (AL utilizes this option for DHR state foster children and DYS children) institutionalized individuals with limited income and resources; (AL utilizes this option and covers up to 300% of the SSI income level) persons who would be eligible if institutionalized but are receiving care under home and community-based services waivers; (AL utilizes this option for the MR, E&D, SAIL, and other waivers) Recipients of State supplementary payments; Alabama does not utilize this option. However, Alabama covers certain individuals who once received SSI and supplemental payments. TB-infected persons who would be financially eligible for Medicaid at the SSI level (only for TB-related ambulatory services and TB drugs) (Alabama does not utilize this option); low-income, uninsured women screened and diagnosed through a Center's for Disease Control (CDC) Breast and Cervical Cancer Early Detection Program (NBCCEDP) and determined to be in need of treatment for breast or cervical cancer. (AL utilizes this federal option which is now a state law) States may use more liberal income and resources methodologies to determine Medicaid eligibility for certain AFDC-related and aged, blind, and disabled individuals under Sections 1902(r)(2) and 1931 of the Social Security Act. For some groups, the more liberal income Federal matching. 5. Does Medicaid Cover All Low-Income People? Medicaid does not provide medical assistance for all poor persons. Even under the broadest provisions of the Federal statute (except for emergency services for certain persons), the Medicaid program does not provide health care services, even for very poor persons, unless they are in one of the designated mandatory groups or in an optional group the state has elected to cover.

21 Low income is only one test for Medicaid eligibility; assets and resources are also tested against established limits in most programs. Categorically needy persons who are eligible for Medicaid may or may not also receive cash assistance from the TANF program or from the SSI program. Additionally, states define in their State Plan, the amount, duration, and scope of coverage. State Medicaid Agencies may place appropriate limits on a service based on such criteria as medical necessity or on utilization control procedures. A State Plan must provide that the services available to any individual in the categorically needy group are equal in amount, duration, and scope for all recipients within the group. 6. What is the Medicaid - Medicare Relationship? The Medicare program (Title XVIII of the Social Security Act) provides hospital insurance (HI), also known as Part A coverage, and supplementary medical insurance (SMI), also known as Part B coverage. Coverage for HI is automatic for persons aged 65 and older (and for certain disabled persons) who have insured status under Social Security or Railroad Retirement. Coverage for HI may be purchased by individuals who do not have insured status through the payment of monthly Part A premiums. Coverage for SMI also requires payment of monthly premiums. Medicare beneficiaries who have low income and limited resources may receive help paying for their out-of-pocket medical expenses from their State Medicaid program. These "dual eligibles" are entitled to Medicare and are eligible for some type of Medicaid benefit. For persons with full Medicaid coverage, the Medicaid program supplements Medicare coverage by providing services and supplies that are available under their State's Medicaid program. Services that are covered by both programs will be paid first by Medicare and the difference by Medicaid, up to the State's payment limit. Medicaid also covers additional services (e.g., nursing facility care beyond the 100-day limit covered by Medicare, prescription drugs, eyeglasses, and hearing aids). Limited Medicaid benefits are also available to pay for out-of-pocket Medicare cost-sharing expenses for certain other Medicare beneficiaries. The Alabama Medicaid program will assume their Medicare payment liability if they qualify. Qualified Medicare Beneficiaries (QMBs), with income at or below 100% of the annual Federal poverty level (FPL), do not have to pay their monthly Medicare premiums, deductibles, and coinsurance. Alabama dropped the resource/assets test for QMBs. Specified Low-Income Medicare Beneficiaries (SLMBs), with resources at or below twice the standard allowed under the SSI program and income exceeding the QMB level, but less than 120% of the FPL, do not have to pay the monthly Medicare Part B premiums. Qualifying Individuals (QIs), who are not otherwise eligible for full Medicaid benefits and with resources at or below twice the standard allowed under the SSI program, will get help with their monthly Medicare Part B premiums, depending upon their income. Each state has a limited number of slots for QI's. Individuals who were receiving Medicare due to disability, but have lost entitlement to Medicare benefits because they returned to work, may purchase Part A of Medicare. If the individual has income below 200% of the FPL and resources at or below twice the standard allowed under the SSI program, and they are not otherwise eligible for Medicaid benefits, they may qualify to have Medicaid pay their monthly Medicare Part A premiums as Qualified Disabled and Working Individuals (QDWIs).

22 7. How Much Does Medicaid Pay for the Medicare Premium Buy-In Program? Through the Buy-In Program, Medicaid pays Medicare Part A and B premiums for eligible Medicaid recipients. In fiscal year 2008, Medicaid paid over $8.4 million in Part A premiums for approximately 1,839 individuals; and over $218 million in Part B premiums for approximately 214,762 individuals. For recipients eligible for the Qualified Medicare Beneficiary (QMB) Program, Medicaid may also cover their Medicare co-insurance and deductibles. For more information about the Buy In program, contact Wanda Wright at (334) Who are Alabama's Medicaid Providers? Any physician or dentist who is licensed by their State License Boards may become a Medicaid provider. Alabama Medicaid's fiscal agent, EDS, processes applications. Primary care physicians provide medical homes for patients through the Patient 1 st program and most primary care physicians in Alabama are enrolled in Medicaid. Physicians taking part in the Medicaid program are designated as serving in rural or urban communities. Each year, more than 600,000 Medicaid patients receive care from a physician and that care is provided by 5,000 physicians, 75% of whom practice in urban areas. Alabama dentists have become more involved in the Medicaid program in the last few years with renewed interest in being available to Medicaid children. As of October 2008, 813 dentists were enrolled in the program. The Agency expects enrollment to continue to expand. Additionally, the number of counties with only one or no dentist enrolled has decreased from 11 to How Does Medicaid Watch for Fraud? The Medicaid Alliance for Program Safeguards is committed to fighting fraud and abuse, which divert dollars that should be spent to safeguard the health and welfare of Medicaid clients. States are primarily responsible for policing fraud in the Medicaid program. Fraud schemes often cross State lines. Through the development of the Medicaid Fraud Statutes website and leadership, the Medicaid Alliance for Program Safeguards works to build partnerships and cooperative efforts among State Medicaid programs, State Program Integrity Units, State Quality Control Units, State Surveillance and Utilization Review Units, State Medicaid Fraud Control Units, the Department of Health and Human Services' Office of Inspector General, the Federal Bureau of Investigation, and the Department of Justice, among other partners. We are all partners, however, in fighting fraud and abuse in Medicaid. Suspected beneficiary or provider fraud may be reported toll free at (800) Who Does Medicaid Cover? Medicaid covers over 930,000 individuals. Individuals generally become eligible through one of the federally mandated programs and sometimes through a federally optional program that Alabama has opted to cover. This is a very condensed summary of the different eligibility programs covered by the Alabama Medicaid program:

23 ELIGIBILITY GROUPS SUMMARY-ALABAMA MEDICAID AGENCY Eligibility Group Includes Federal Requirement Meets or Exceeds or Optional Program NURSING HOME/ INSTITU- TIONALIZED The 2009 nursing home income limit is $2,022 SSI-RELATED MEDICARE- RELATED PREGNANT WOMEN AND CHILDREN MEDICAID FOR LOW-INCOME FAMILIES OPTIONAL FEDERAL CATEGORIES ALL OTHER Nursing home; extended hospital awaiting nursing home placement; facilities for the mentally ill or retarded Widow/Widower; Disabled Adult Child; Grandfathered Cases; continuous (PICKLE); retroactive SSI; children of SSI mothers Qualified Medicare Beneficiaries; Specified Low Income Medicare Beneficiaries; Qualifying Income Individuals, and Qualified Disabled Working Individuals Pregnant women and children under the age of 19 Low income families with children Breast and Cervical Cancer Program; State of AL Independent Living (SAIL) waiver; MR waiver; E&D waiver; OBRA waiver; Plan First waiver, Technology Assisted waiver for Adults, HIV/AIDS waiver Emergency Services for Aliens; Department of Youth Services Children; DHR Foster Children; Adopted Children; Refugees etc. Income guidelines set annually at federal level SSI income limits at $694 for individual and $1,031 for couple. FPL as of 02/2008 QMB-income below 100% FPL ($887 individual; $1,187 - couple); SLMB-income between 100%- 120% FPL ($ $1, individual; $1, $1, couple); QI-1-between 120%-135% ($1, $1, individual; $1, $1, couple) QDWI- income under $1, individual; $2, couple Covers children under age 6 and pregnant women with family income below 133% of the FPL; and children age six but under age 19 (6-18) up to 100% of the FPL. Section 1931 of the SSA who meet eligibility requirements in on July 16, AL utilizes option 1915 (c) of the SSA to cover individuals who meet the institutional level of care but desire to remain at home and receive care under the SAIL waiver, MR waiver, E&D waiver, Technology Assisted waiver for Adults, and HIV/AIDS waiver. Title IV-E covers adoption and foster care Exceeds. AL covers institutionalized individuals with income up to 300% of the SSI income level. This option is known as the 300% of SSI rule. Resources are within the SSI resource limit. As required by law, AL covers individuals who establish a Qualifying Income Trust. Meets minimum federal requirements. AL does not utilize the option to cover optional supplementary payment groups. AL does not utilize the OBRA 86 option for aged and disabled persons with incomes up to 100% of the FPL. Meets minimum income requirements. However, AL applies less restrictive methodology. Fluctuating income may be averaged for the past six months and projected for 12 months; in-kind support and maintenance is not counted as income; interest and dividend income is not counted in determining eligibility; and all resources are disregarded. Meets minimum income requirements for pregnant women and children under age 19. Infants born to Medicaid eligible pregnant women have coverage through the first year of life. AL does not utilize option to cover family income up to 185% of the FPL. AL does not impose optional assets/ resource test. Meets federal income requirements but is well below the national average. Covers only the poorest of the poor (11.5% of FPL). The federal optional Breast and Cervical Cancer Option was passed into AL law as a mandated service. The Home and Community Based Waivers are optional services that provide a cost savings to the agency. Otherwise these individuals would be in more costly nursing home settings. The Plan First optional waiver continues to be a cost effective waiver by reducing costs for unplanned pregnancies. AL meets requirements for aliens ER services. AL does not utilize option to cover TB infected individuals. AL utilizes option to cover certain children (state foster children) up to age 21 who meet income and resource requirements for AFDC and have special medical needs. Refugee services are 100% reimbursed by the refugee resettlement program.

24 11. Please Summarize the Eligibility Policy for the Elderly and Disabled. Cash Assistance Group Alabama is a Section 1634 state. We accept the Social Security Administration's eligibility determination. State Supplement Group (Optional Group) Many states supplement the basic SSI cash assistance with state supplementary payments (SSP) to certain SSI beneficiaries (who receive the SSI payment plus the SSP) and people with incomes too high to qualify for SSI (only receive the SSP). Financed solely with state money, these payment amounts vary widely from state to state. States can opt to make anyone receiving an SSP automatically eligible for Medicaid; at least thirty-five states have elected this option. States may also apply less restrictive methodologies to this group when determining how to count income and resources. Individuals receiving State Supplemental payments (SSP) are automatically eligible to receive Medicaid in Alabama. Dual Eligible Group Described in the Medicaid-Medicare Relationship, question 6. Alabama applies the following less restrictive income methodologies for this group: Fluctuating income may be averaged for the past six months and projected for twelve months; in-kind support and maintenance (ISM) is not counted as income; interest income is not counted in determining eligibility; dividend income is not counted in determining eligibility. All resources are disregarded (no asset test). Institutionalized Individuals (Optional Expansion) Congress gave states the option to use the special income rule to provide Medicaid to persons in institutions who have too much income to qualify for SSI benefits, but not enough income to cover their expensive long-term care. Under the special income rule, also known as the 300% of SSI rule, states may set a special income standard up to 300% of the maximum SSI benefit. This applies to gross income only that is, there are no exclusions or deductions. Resource standards are generally the same as those in the SSI program. The special income rule was originally limited to persons in institutions, but now states may elect to apply it to those receiving services under home and community-based care (HCBS) waivers, as well. Both groups persons in institutions and persons under HCBS waivers are required to incur a post-eligibility cost-sharing burden under this eligibility category. States that use the special income rule, but do not offer a medically needy group for aged, blind, and disabled persons must allow the use of Qualifying Income Trusts (QITs) also known as Miller Trusts a trust designed to hold and purpose of becoming eligible for Medicaid, subject to Medicaid estate recovery. States must allow nursing facility residents to keep a limited amount (at least $30) of their income as a personal needs allowance. Some states have opted to increase this amount slightly. Each state also has spousal impoverishment protections in place to ensure that when one spouse is institutionalized for at least 30 days, the other spouse the community spouse does not lose all income and resources,

25 thereby becoming impoverished and needing public assistance. The community automobile, and burial funds) are combined and then halved to determine the spousal sh protected resource amount (CSRA). The amount actually protected for the community spouse is the greater of either the spousal share or the CSRA. By federal law, the CSRA is subject to a minimum (at and below which the entire amount is protected) and a maximum. When setting its CSRA, the state may exceed the federally prescribed minimum, but may not exceed the federal maximum. Alabama uses the special income standard for institutionalized individuals. The special income standard is at 300% of SSI income for a month. The monthly personal needs allowance for nursing facility residents is $30 per individual in nursing home. (Veterans or widows of veterans with no dependents may receive $90.00 VA benefit payment while in the nursing home for personal needs allowance.) Alabama uses an amount in the middle as its minimum community spouse protected resource standard. Our minimum community spouse protected resource standard is $25,000. We allow the federal maximum community spouse protected resource of $109,560. Home and Community-Based Waiver Services (Optional Group) States may apply for 1915(c) home and community-based care waivers that allow them to extend Medicaid eligibility to those at risk of institutionalization who wish to remain in a community setting. Under this waiver authority, a state may provide a wider range of long- Medicaid program, including non-medical services such as minor home modifications like ramps or special safety devices. Often states operate several HCBS waivers targeted to various populations. Applicants must still qualify for Medicaid under one of the Medicaid eligibility groups and must require a nursing home level of care. However, many states link financial eligibility for their HCBS waivers to a percentage of the maximum monthly SSI payment (often via the special income rule), a percentage of the federal poverty level, or their medically needy income level. States may apply spousal impoverishment rules to HCBS waiver participants, similar to the protections guaranteed to institutionalized persons. States may choose to allow spend-down to HCBS waiver eligibility levels. If a state uses the special income rule and does not allow spend-down to HCBS eligibility levels, it may allow Qualifying Income Trusts (Miller Trusts) in determining eligibility for HCBS waivers. Because waiver participants must cover all of their living expenses themselves, states that extend the special income rule to HCBS often allow them a significant personal needs allowance. In addition, states may offer a monthly maintenance needs allowance for a spouse. Alabama uses different income standards for its HCBS waivers. Income eligibility for HCBS waivers is tied to:

26 300% federal benefit rate for SAIL, HIV/AIDS, TA, MR and the Elderly and Disabled waivers. Alabama does not allow spend-down to HCBS waiver eligibility levels. Alabama does not allow Qualifying Income Trusts (Miller Trusts) in determining eligibility for HCBS waivers. Alabama's protected monthly income for individuals receiving HCBS varies by waiver: The SAIL, HIV/AIDS, TA, MR and the Elderly and Disabled waivers protect 300% of the federal benefit rate. Alabama's monthly maintenance needs allowance for a spouse (other than spousal impoverishment rules) is none. In, Alabama, none of the waiver participants incur a post-eligibility cost-sharing burden or liability. 12.Please Summarize the Eligibility Policy for the Women's and Children's Groups. Pregnant Women and Children (Mandatory Group) In 1986, Congress enacted legislation allowing states, for the first time, to expand eligibility for Medicaid without expanding eligibility for Aid to Families with Dependent Children (AFDC). This federal law was called the Sixth Omnibus Budget Reconciliation Act (SOBRA). Subsequently, other federal laws have been enacted mandating coverage to even more children and pregnant women and mandating the outstationing of social workers in disproportionate share hospitals and health centers for easy access to the program by potential clients. In 1997 Congress passed the Balanced Budget Act. This legislation created the Title XXI Child Health Insurance Program (CHIP). The same legislation allowed for Continuous Medicaid Eligibility for all children determined eligible April 1, 1998 or thereafter. In July 1988, Alabama enacted this legislation to provide Medicaid coverage to pregnant women and children with income at or below the required Federal Poverty Level. Alabama has 180 SOBRA workers outstationed in hospitals, health department clinics and other health centers. Alabama was the first state in the nation to implement CHIP through a Medicaid expansion on February 1, Pregnant women and children under age six must have family income at or below 133% of the federal poverty level Children age six to 19 must have family income at or below 100% of the federal poverty level Family assets are not counted for eligibility. Parental income is not counted for pregnant women who only desire to receive pregnancy related services Pregnant women, once determined eligible, remain eligible through sixty days post-partum

27 Children born to Medicaid eligible pregnant women remain eligible for one year without separate application or verification Children under age 19, once determined eligible, remain continuously eligible for 12 months as long as they reside in the state. Pregnant women may be eligible to receive full Medicaid services through their sixty days post-partum if they meet Medicaid for Low Income Families income standards Income for a child in the home is not counted toward the eligibility of a pregnant woman or another child Income of a step-parent is not counted toward the eligibility of a child in the home Related or non-related caretakers may apply for a child Income of caretakers other than legal parents is not counted toward the eligibility of a child Application may be made in-person, by mail or on-line, and you may apply in any county Medicaid for Low Income Families Qualified Pregnant Women ((MLIF-Q) Certain pregnant women may qualify for full Medicaid coverage. If the claimant meets Medicaid for Low Income Families (MLIF) program requirements, she may choose to receive full Medicaid coverage instead of coverage for only pregnancy related services normally covered through the SOBRA program. In addition to SOBRA requirements, the claimant must meet the following requirements in order to qualify for full coverage: Gross monthly income must fall below Medicaid for Low Income Families income limits. If the pregnant claimant is under age 18 and is living in the home with her parent(s), the amount of deemed income must not exceed MLIF income limits. Plan First (Optional Waiver for Family Planning Services) The Plan First waiver extends Medicaid eligibility for family planning services to all women of childbearing age (ages 19 through 55) with incomes at or below 133% of the federal poverty level that would not otherwise qualify for Medicaid coverage. Under existing Medicaid Programs, adult women and teenage girls are covered for family planning services along with all other Medicaid services through the Medicaid for Low Income Families (MLIF) program, the SSI program or other categorical eligibility groups. Women who receive Medicaid coverage for pregnancy and delivery services through the SOBRA program are covered for family planning services until the end of the month in which the 60th postpartum day falls. Women served through Plan First will be able to take advantage of all family planning services that are offered through the Alabama Medicaid Agency and will be able to receive these services directly through any qualified provider enrolled in the Plan First Program. Breast and Cervical Cancer Program (Optional Eligibility Group) The Breast and Cervical Cancer Prevention and Treatment Act of 2000 (BCCPTA) allows states to provide full Medicaid benefits to uninsured women under age 65 who are identified through the Centers for Disease Control and Prevention's National Breast

28 and Cervical Cancer Early Detection Program (NBCCEDP) and are in need of treatment for breast or cervical cancer. This includes pre-cancerous conditions of the breast or cervix and early stage cancer. The Alabama Legislature passed the Breast and Cervical Cancer Prevention and Treatment Act of 2000, requiring the federally optional program to be implemented in Alabama. Effective October 1, 2001, the Alabama Medicaid Agency extended full coverage Medicaid eligibility to females under age 65 who have been screened by the Alabama Breast and Cervical Cancer Early Detection Program (ABCCEDP) and been found to need treatment for breast or cervical cancer. In Alabama, the CDC funded program is administered through the Alabama Department of Public Health. 13. What are the Mandatory Services for Categorically Needy Medicaid Beneficiaries? Mandatory Services are defined at 42 CFR References below are from 42 CFR or the SSA. Mandatory services are: Inpatient hospital services other than services in an institution of mental disease Outpatient hospital services (a) Federally Qualified Health Centers 1905 (a)(2)(c) of the SSA Rural Health Clinic services (b) Other laboratory and X-ray services Nursing facility services for individuals age 21 or older (other than services in an institution for mental disease) (a) Early Periodic Screening, Diagnostic, and Treatment (EPSDT) (b) Family planning services and supplies (c) Physician services (a) Medical and surgical services of a dentist that if provided by a physician would be considered physician's services (b) Home health services including nursing, aide, and therapy services provided by a Home Health Agency in the home; and medical supplies, equipment and appliances suitable for in-home use Nurse midwife services Nurse practitioner services Pregnancy related services including postpartum Which Services are Optional for Categorically Needy Medicaid Beneficiaries? *Clinic services-preventive, diagnostic, therapeutic, rehabilitative, or palliative services that are furnished by a facility that is not part of a hospital Critical Access Hospital (CAH) services (g) Dental services-diagnostic, preventive and corrective procedures Dentures (b) *Diagnostic, screening, preventive, and rehabilitative services Emergency Hospital services even if the hospital does not meet the conditions of participation for Medicare or the definitions of (e)

29 *End Stage Renal Disease *Eyeglasses (d) *Home and Community Based services / *Hospice services 1905(o) of the SSA *ICF-MR facility services *Inpatient hospital services, nursing facility services, or intermediate care facility services for individuals age 65 or older in institutions for mental disease Inpatient psychiatric services under age Medical or other remedial care provided by licensed practitioners other than physicians within the scope of practice defined by State Law such as chiropractic services Occupational therapy (b) *Organ transplants Personal care services Physical therapy (a) *Prescribed drugs (a) *Primary care case management services Private duty nursing services Prosthetic devices (c) Respiratory care for ventilator dependent individuals Services for individuals with speech, hearing and language disorders (c) Skilled nursing facilities for individuals under age *Targeted Case Management services 1905(a)(19) or 1915(g) of the Act *Transportation *Indicates the optional services covered by Alabama Medicaid for adults under the State Plan. QMBs receive additional coverage if Medicare makes payment. 15.How is Medicaid Funded? The Federal and State governments jointly fund Medicaid. To be eligible for federal funds, states are required to provide Medicaid coverage for mandated coverage groups. The FY 2009 approved budget is $4.5 billion. This includes the state and federal share. Alabama Medicaid has one of the lowest administrative costs in the nation at 3 percent. Medicaid strives to place every possible dollar into use for direct medical services to beneficiaries thereby decreasing administrative costs associated with salaries, overhead and activities such as outreach. Medicaid outreach activities are often funded through grants Medicaid has procured in order to save budget dollars for direct medical services. Since the federal administrative match is lower for outreach than for actual medical service benefits and Medicaid funding is constrained, Medicaid judiciously uses its funding almost exclusively for the direct medical care of its beneficiaries. Very few public or private organizations have as cost-effective administration as the Alabama Medicaid Agency. For additional information on administrative costs, contact our Chief Financial Officer, Terry Bryant at (334)

30 16.Where is the Money Spent? Where is the Money Spent? FY 2007 Benefit Payments Percent Distribution Mental Health Services 3.0% Health Services 3.1% Insurance 5.3% Physician 6.6% Pharmacy 10.0% Waiver & Community Services 14.8% Nursing Facilities 22.1% Hospitals 35.1% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

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