Medicaid 101 Damon Terzaghi Senior Director NASUAD dterzaghi@nasuad.org www.nasuad.org
Contents Overview & History of Medicaid How Medicaid is Administered Overview of Eligibility Overview of Services Medicare Savings Programs Medicaid LTSS Medicaid Managed Care Current Issues in Medicaid Page 2
Medicaid Overview Page 3
Medicaid Overview Created in 1965, along with Medicare (P.L. 89-97), under the Social Security Amendments of 1965; State & Federal partnership for funding and policy; Intended to be a health plan for low-income individuals on welfare; Does not provide the care pays medical professionals (providers) to deliver the care; Page 4
Medicaid Overview Optional program for States last State (AZ) began participation in 1982; Medicaid is unique in that it covers more Americans than any other health insurance program; In FY2014, $494 billion dollars were spent on the Medicaid program in the states & territories; 15.1 percent of U.S. health care spending in 2012 Roughly one fifth of all Americans are covered by Medicaid. Page 5
Medicaid Enrollment & Expenditures Page 6
Medicaid Enrollment & Expenditures Older adults and persons with disabilities represent a majority of Medicaid expenditures despite being less than half of enrollees. Chronic care and significant health conditions are a major component of these expenses, as are Longterm Services and Supports (LTSS). Medicaid is the largest source of LTSS financing in the USA, paying for over $144 billion in 2013 which represented 42% of overall expenditures on LTSS 1 Medicare ($74B) and out-of-pocket ($57B) were the next two largest sources of LTSS expenditures 1 Congressional Research Service, 2015. See: https://fas.org/sgp/crs/misc/r43483.pdf Page 7
Medicaid Operations and Administration Page 8
Medicaid Governing Policy Medicaid is funded and administered jointly by the Federal Government and states. The Federal Government establishes rules and parameters for the program. Primary direction is provided through statute and regulation: Social Security Act (Title XIX); Code of Federal Regulations (Title 42) The Centers for Medicare and Medicaid Services (CMS) also issues other guidance to states: State Medicaid Director s Letters; State Health Official Letters; Informational Bulletins; and Frequently Asked Questions (FAQs). Page 9
The Medicaid State Plan Every state must have an approved Medicaid State Plan that describes its program; the program must be operated according to the State Plan. Among other components, state plans include: Groups of individuals to be covered; Services to be provided; Methodologies for providers to be reimbursed; and Administrative activities. States must submit and receive approval of a State Plan Amendment (SPA) to change how its Medicaid program is operated. Page 10
Medicaid Financing HHS calculates a Federal Medical Assistance Percentage (FMAP) the Federal share of any medical costs paid by Medicaid; Different for each state; Based upon per capita income of residents; Minimum of 50% & Maximum of 82%; Average FMAP across the U.S. is 57% (not including ACA enhanced match rate) Adjusted on a 3-year cycle, and published annually All states receive a 50% match for administrative costs. Certain other expenses, such as information systems and family planning, receive higher match rates. Page 11
Federal Matching Funds (FFY 2015) for Pre-ACA Covered Populations WA ME MT ND VT MN NH OR WI NY MA ID RI SD MI CT WY PA NJ IA NE OH DE NV IL IN MD WV CA UT VA D.C. CO KS MO KY NC TN OK SC AZ AR NM GA MS AL LA TX AK FL HI 67-73.6% (11 states including DC) 60-66.9% (13 states) 50.1-59.9% (14 states) 50% (13 states) Source: Kaiser Commission on Medicaid & the Uninsured, Medicaid Moving Forward, March, 2015 Page 12
Role of CMS and the States Federal law and regulation (administered by CMS) specify core requirements all states must meet to receive federal funding. Within federal guidance, states define how they will run their program: State laws and regulations; State budget authority and appropriations Medicaid State Plan; and Waivers. Subject to review/approval by CMS, states have flexibility regarding eligibility, benefits, provider payments, delivery systems and other aspects of their programs. Each state must have a single state agency that administers Medicaid. Page 13
Medicaid Eligibility Page 14
Medicaid Eligibility Categorical Eligibility people must fit into a pre-defined group of individuals: Children; Parents; Pregnant women; Seniors; People with Disabilities; and Childless, non-elderly, adults (ACA expansion) Eligibility is based on the person, so some people in a family may be covered and some may not be eligible (commonly: kids are covered; parents are not) Income Eligibility people must also have income below defined limits, usually set by Federal Poverty Level (FPL) Medically Needy Eligibility individuals can become Medicaid eligible if they spend their own money on health care expenses (Spend-down) Non-financial eligibility requirements generally include residency in the state and always include citizenship (undocumented immigrants are NOT eligible for Medicaid; documented immigrants have a 5-year waiting period before becoming eligible except in specific cases) Page 15
Medicaid Eligibility: Mandatory And Optional Groups Mandatory Groups: Categorical Groups that a State must include if they participate in Medicaid; Over 25 mandatory groups, including: Supplemental Security Income (SSI) eligible (except in 209(b) states); Children 0-5 below 133% FPL; and Young adults formerly in foster care (until age 26) within the same state Low-income Medicare beneficiaries (not always full Medicaid services). Optional Groups: Groups that a State can choose to include; Includes all Medically Needy Groups; Over 25 optional Categorical groups, including: Medicaid Buy-ins; Affordable Care Act (ACA) expansion; Higher income eligibility for Medicaid categories. Other: States sometimes have individuals enrolled in state-only (non-medicaid) programs that are very similar to Medicaid Page 16
ACA Changes ACA expanded Medicaid eligibility to childless adults and raised eligibility to 138% FPL, and eliminated asset tests (except for elderly and disability categories) ACA also changed how income is counted moving to modified adjusted gross income (MAGI) Supreme Court rules the eligibility expansion could be at state option (other changes still are required) ACA simplified the eligibility process Electronic verification of income No wrong door Integration with state exchanges Simplified but still not simple. Page 17
Current Status of State Medicaid Expansion Page 18
Medicaid Services Page 19
Medicaid Services: Mandatory And Optional Mandatory services include: Hospital services & Nursing homes; Physician Services, nurse practitioners; X-rays, clinics, lab services; Free standing birth centers; Tobacco cessation for pregnant women. Optional services include: Prescription Drugs; Dental; Case Management; Rehabilitation (both physical and psychosocial); Personal Care. Other considerations: Other sources of health care do NOT impact Medicaid eligibility: If a person has other coverage (such as Medicare or private insurance), Medicaid only pays for services not provided through the other coverage; Medicaid often assists with copays/premiums associated with other coverage. Page 20
Medicaid Services Once a person comes into Medicaid, they have access to all of the services that the state covers and are medically necessary; Services must be statewide, comparable, delivered with reasonable promptness, and allow individuals to choose providers; States can define the amount, duration and scope of services to reasonably achieve their purpose; Some services are specifically excluded (Hyde amendment) Early and Periodic Screening, Diagnostic, and Treatment (EPSDT): Children under 21 can get all medically necessary optional and mandatory services, regardless of whether the state covers them for other individuals. Page 21
Medicaid Waivers Allow the state to waive certain Medicaid requirements, including state-wideness, freedom of choice, and comparability; Not an entitlement can have enrollment limits or waiting lists; Cost-neutrality requirements; Most common include: 1115: Waiver of variety of Medicaid policies for research and evaluation ; 1915(b): Waiver of freedom of choice 1915(c): Waiver of comparability allows states to target diagnoses, and option to waive statewideness; Page 22
Medicaid Waivers 1115 Waivers provide broad flexibility: Can expand coverage to non-categorical groups; Can implement managed care; Can test new service-delivery methods. 1915(b) Waivers: Can limit which providers individuals can utilize; Allows states to enroll people in managed care. 1915(c) Waivers: Provide Home and Community-Based Services (HCBS), including: Habilitation; Transportation; Personal Care. Allows states to create a robust service package for individuals with an institutional level of care (ie: a person with a disability or a senior with significant health care needs). Page 23
Medicare Savings Programs Page 24
MSP Program Eligibility Criteria Benefits Provided Qualified Medicare Beneficiary (QMB) QMB Plus Specified Low- Income Medicare Beneficiary (SLMB) Below 100% FPL; Resources below $7,390 (individual) or $11,090 (married couples)** **These are adjusted annually Below 100% FPL; Resources below $7,390 (individual) or $11,090 (married couples)** and meet state Medicaid eligibility criteria Between 100%-120% FPL; Resources below $7,390 (individual) or $11,090 (married couples)** Assistance with: Part A premiums Part B premiums Deductibles, coinsurance, and copayments All Medicaid-covered services and all QMB benefits Assistance with Part B premiums Qualified Individual (QI) Qualified Disabled and Working Individuals (QDWI) Between 120%-135% FPL; Resources below $7,390 (individual) or $11,090 (married couples)** Below 200% FPL; resources below $4,000 (individual) or $6,000 (married); Lost eligibility for premium free Part A due to working Assistance with Part B premiums Assistance with Part A premiums Page 25
Medicare Savings Programs Section 1902(r)(2) of the Social Security Act allows states to disregard certain types of income and/or assets for eligibility determination This can result in higher eligibility limits than discussed on the prior slide in states that choose to use this provision Disregards can be blanket (i.e. disregarding all income or assets up to a higher level, or removing asset tests) or targeted (i.e. disregarding specific types of assets otherwise counted) For more information on MSP programs, visit: https://www.cms.gov/outreach-and-education/medicare- Learning-Network- MLN/MLNProducts/Downloads/Medicare-Beneficiaries- Dual-Eligibles-At-a-Glance-TextOnly.pdf Page 26
Medicare Savings and Part D Low-income Subsidy Individuals who qualify as QMB, SLMB, QI, as well as other fully Medicaid eligible beneficiaries are deemed eligible for the Part D low-income subsidy This deemed eligibility means that these individuals do not have to actively apply for LIS eligibility; the LIS should begin in the month after determination of eligibility for the other programs Note: when providing assistance to individuals, it may be beneficial to apply for both programs simultaneously even if eligibility for one triggers eligibility for the other. See: https://www.ncoa.org/wpcontent/uploads/simultaneous-lis-and-msp.pdf Page 27
Conditional QMB Status Some individuals may not qualify for Premium-free Part A services, due to a lack of work history and/or payment of Medicare taxes In order to be eligible for QMB, a person must be enrolled in both Part A and Part B thus, a conundrum is created since most individuals are unable to afford the Part A premium prior to QMB eligibility determination SSA can process a conditional application that will enroll the individual in Part A once QMB status is determined, or be discarded if QMB is denied This can enable the person to enroll outside of the standard initial or open enrollment period (provided that they are in a Part A buy-in State. In States without a Part A buy-in agreement, this does not apply) For information on conditional enrollment: http://www.medicareadvocacy.org/oldsite/projects/advocatesalliance/issuebriefs/09_10.19.qmbswithoutpart A.pdf For information on Part A buy-in States: https://secure.ssa.gov/apps10/poms.nsf/lnx/0600801140 Page 28
Medicaid LTSS Page 29
Medicaid LTSS A variety of programs exist that provide Long-term Services and supports in Medicaid, which could be accessed by individuals with Alzheimer s and/or dementia LTSS in Medicaid includes institutional services in nursing homes (mandatory) as well as HCBS (optional) Each state sets their own standards for clinical eligibility, known as level of care LTSS can also have different eligibility criteria The special income group allows individuals who require LTSS to qualify with income at 300% of SSI (approximately 225% FPL) instead of lower levels for non-ltss groups Special income group exists in many states, but not all cover up to 300% SSI State-by-state listing of Special Income Rule policies: http://kff.org/other/state-indicator/medicaid-eligibility-forlong-term-care-through-the-special-incomerule/?currenttimeframe=0 Page 30
Medicaid LTSS The most common type of HCBS is authorized via 1915(c) nearly 300 waivers nationwide Requirement that individuals meet institutional LOC criteria States must demonstrate cost neutrality Allows comprehensive and flexible services including other services Cannot pay for room and board expenses individuals must have other means of financing housing Leads to barriers for community living for some individuals Page 31
HCBS Authority Comparison 1915(c) 1915(i) 1915(k) 1115(a) Clinical Eligibility Criteria Must meet state s institutional level of care Must be less stringent than the comparable institutional criteria for the population Must meet state s institutional level of care State can implement various criteria if approved by CMS Financial Eligibility Criteria Special income group applies. Other Medicaid groups can be included. 150% FPL or 300% SSI if meet LOC. Special income group does not apply. State can establish separate eligibility group with own income test. In an eligibility group that includes nursing home services. If not, then 150% FPL. State can implement various criteria if approved by CMS Enrollment limits Enrollment limits and waiting lists allowed Not allowed. All eligible must be able to access services. Not allowed. All eligible must be able to access services. Enrollment limits and waiting lists allowed Page 32
HCBS Authority Comparison Cost neutrality 1915(c) 1915(i) 1915(k) 1115(a) Required Not required Not required Required Approval Timeframe No timeline 90 days 90 days No timeline Approval Period Five years Can be indefinite; can be five years Indefinite 5 years Services Included Wide range of HCBS, including habilitation, personal care, adult day health, and other CMSapproved Same as 1915(c) Attendant Care services; items substituted for human assistance Can include various services proposed by State and approved by CMS Page 33
Managed Care Page 34
Overview FFS vs. MMC Fee-for-service (FFS) Relationship: State contracts directly with health care providers. Payment: Providers receive payment for each health care service provided to consumers. Accountability: Providers do not bear financial risk for the provision of services. Note: FFS has historically been the predominant delivery system. Page 35
Overview FFS vs. MMC (Cont.) Medicaid Managed Care (MMC) Relationship: State contracts with a Managed Care Organization (MCO), not a direct service provider. Service Delivery: Consumers receive part or all of Medicaid services from health care providers that are paid by a MCO that is under contract with the state. Payment: MCOs receive capitated payment from the state for a specified benefit package on a per member per month basis. Accountability: The MCO is responsible for the provision and coverage of Medicaid services. Page 36
Managed Care Plan Requirements Key requirements Sufficient providers to ensure access to services (network approved and monitored by state); Coordinate care for members who have special needs or use long term services and supports (LTSS); Measure and report to the state on quality of care; Provide access to member services by phone, web, and email; Authorize (when appropriate) and pay providers timely for services; Have an appeal process for disagreements on service access; Spend at least 85% of payments from the state on services and quality activities (effective 7/1/17); Implement activities to minimize fraud, waste and abuse. Page 37
Managed Care Authorities Social Security Act (SSA) provides four ways that states may operate their programs (numbers refer to SSA sections): 1915(a) - Voluntary Program; 1932(a) - State Plan Amendment (SPA); 1915(b) - Managed Care Waiver; 1115(a) - Research & Demonstration Project. States may use multiple authorities depending on the program s design and the populations receiving benefits. CMS will provide technical assistance to direct states to the proper authority for their program s design. CMS must also approve state plans for managed care. Page 38
Authority Comparison Ability to Mandate Enrollment No 1915(a) 1932(a) 1915(b) 1115(a) Yes; except special needs children, AI/AN, dual eligibles Yes Yes Service Area Statewide or limited to certain areas Statewide or limited to certain areas; Can also offer different benefits to enrollees Statewide or limited to certain areas Statewide or limited to certain areas Selective Contracting Not allowed Allowed Allowed Allowed Cost-test Not required Not required Required Required Approval Timeframe Approval Period No timeline 90 days 90 days No timeline Indefinite Indefinite 2 years 5 years Page 39
WA All Managed Care Programs MT ND VT NH ME CA OR NV ID UT WY CO SD NE KS MN WI IA IL MO MI OH IN KY TN WV NY PA RI VA NC RI CT NJ DE MD DC AZ NM OK AR SC MS AL GA TX LA FL Acute care MC program - MCOs only HI Acute care MC program both MCOs AND limited benefit plans Acute care MC program - only limited benefit plans State has both acute care & MLTSS programs Source: NASUAD survey; CMS data Page 40
Medicaid and ACA Considerations Current discussions regarding the broader healthcare system are centered around ACA repeal, but may have significant impacts on Medicaid and other public insurance programs Current policy ideas under consideration include: Keeping Medicaid as-is ; Repealing the ACA expansion and/or increased Federal funding for expansion: This might include some ACA LTSS options, such as the 1915(k) Establishing per-capita limits on Medicaid spending; or Repealing Medicaid s entitlement and converting to stateoperated block grants. Other discussions involve an expansion of CMS/HHS waiver authority to allow state innovation Page 41
Questions? For more information, visit www.nasuad.org Page 42