Health and Disability Policy Briefing

1. 1 Health and Disability Policy Briefing The American Public Human Services Association July 2007

2. 2 Disability: The Numbers Approximately 50 million Americans (19.3 percent) have a disability of some type. Many individuals have more than one type of disability. The likelihood of disability increases with age. Nearly 70 percent of people with disabilities are children or working age adults. Source: Access of Health and Long-Term Services for People with Disabilities, Jeffrey S. Crowley, Health Policy Institute, Georgetown University, April 2006 Over 25 million people have a specific, chronic disability lasting at least one year. Over 25 million people have a specific, chronic disability lasting at least one year.

3. 3 Overview: Work & Health Coverage Interaction People who work use their health insurance less. Employer-sponsored health insurance is declining and becoming less comprehensive. Many people with disabilities have health-related needs that are not covered by private insurance. Private coverage is often unavailable or unaffordable to people with disabilities.

4. 4 Medicaid: The Basics Medicaid provides coverage for designated groups of low-income individuals and individuals with disabilities. Jointly financed by the federal and state governments. States determine services covered, provider payments, and certain eligibility qualifications, within federal guidelines. Federal government match rate for each state is based on a formula using average state per capita income. Eligibility qualifications vary from state to state and include income and resource limits, citizenship, and residency. Federal government match rate for each state is based on a formula using average state per capita income. Eligibility qualifications vary from state to state and include income and resource limits, citizenship, and residency.

5. 5 Medicaid: Mandatory and Optional Services Mandatory Services Physician’s services Laboratory and x-ray Inpatient and outpatient hospital services Early and periodic screening, diagnostic, and treatment (EPSDT) services for individuals under 21 Nursing facility services Home health services (for those entitled to nursing home care) Optional Services Prescription drugs Dental services Physical therapy Prosthetic devices Intermediate Care Facilities for persons with Mental Retardation (ICF/MR) services Personal care services Rehabilitation services Private duty nursing Hospice services Home and community-based services

6. 6 Ten Things to Know About Health and Disability Policy Disability/chronic illness can affect all aspects of someone's life: employment, education, health, housing, income, and the need for medical and support services. Nearly half of Medicaid expenditures cover services for people with disabilities. 17 percent of Medicaid enrollees are people with disabilities (2006) 46 percent of Medicaid expenditures are for people with disabilities (2006)

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8. 8 Ten Things to Know About Health and Disability Policy Medicaid provides a comprehensive set of acute and long-term care benefits to meet the needs of people with disabilities. Medicaid is the single largest source of funding for long term care services. 47% of national spending on long-term care in 2003 was paid by Medicaid. Medicaid is the single largest source of funding for long term care services. 47% of national spending on long-term care in 2003 was paid by Medicaid.

9. 9 Medicaid Expenditures by Service

10. 10 Ten Things to Know About Health and Disability Policy Disabilities include both physical and mental impairments. Medicaid provides coverage for both, and is the single largest payer of mental health services. Physical disability: an impairment that affects the body’s ability to function normally. Mental disability: an impairment in the ability to learn or think, or that affects a person’s behavior or perception. Many people have more than one type of disability. Physical disability: an impairment that affects the body’s ability to function normally. Mental disability: an impairment in the ability to learn or think, or that affects a person’s behavior or perception. Many people have more than one type of disability.

11. 11 Ten Things to Know About Health and Disability Policy Medicaid is leading the way in supporting employment for people with disabilities. Medicaid covers mandatory services that are essential to employment: acute care, long-term care, and inpatient and outpatient hospital services. Medicaid Infrastructure Grants (MIG) Another critical support is retaining health coverage through the Medicaid Buy-In, SSI sections 1619 (a) and (b), and other options. MIGs: Supports system change efforts to foster employment.MIGs: Supports system change efforts to foster employment.

12. 12 Supporting Employment (Continued) States have implemented Medicaid programs and demonstration projects to allow working people with disabilities to retain health coverage. Medicaid Buy-In program 1902(r)(2) 1115 waiver DRA Benchmark Benefits Medicaid Buy-In program: allows eligible individuals with disabilities to “buy into” the Medicaid program. 1902(r)(2): provides flexibility in setting income and asset tests. 1115 waiver: permits expansions of Medicaid to people with disabilities, including specific groups of people with disabilities; also allows use of Personal Assistant Services Medicaid Buy-In program: allows eligible individuals with disabilities to “buy into” the Medicaid program. 1902(r)(2): provides flexibility in setting income and asset tests. 1115 waiver: permits expansions of Medicaid to people with disabilities, including specific groups of people with disabilities; also allows use of Personal Assistant Services

13. 13 Medicaid Buy-In: Overview The Medicaid Buy-In program allows states to expand Medicaid coverage to working individuals with disabilities whose income and assets would otherwise make them ineligible. Currently 33 states have Buy-In programs. As of 2005, more than 161,000 people have participated in state Buy-In programs. The Medicaid Buy-In program is an optional state program that addresses one of the major barriers to employment for people with disabilities – the loss of health coverage. The most common primary disabling conditions of Buy-In participants are mental illness and intellectual disabilities. The Medicaid Buy-In program is an optional state program that addresses one of the major barriers to employment for people with disabilities – the loss of health coverage. The most common primary disabling conditions of Buy-In participants are mental illness and intellectual disabilities.

14. 14 National Buy-In Enrollment by Quarter (2000-2005) Source: The Interaction of Policy and Enrollment in the Medicaid Buy-In Program, 2005: Final Report, Mathematica Policy Research, Inc., May 2007, Figure III.1 Note: Missouri rescinded its Buy-In program in August 2005 causing a drop in total enrollment. The program has been reinstated in 2007.

15. 15 Medicaid Buy-In Program: Basic Guidelines & Requirements The Medicaid Buy-In program was created in the Balanced Budget Act of 1997 (BBA). Must be below 250 percent of FPL. Cannot exceed Supplemental Security Income (SSI) resource standard. Section 1902(r)(2) Ticket to Work and Work Incentives Improvement Act of 1999 (TWWIIA) expanded the Medicaid Buy-In program. Added two new optional eligibility groups. States can establish their own income and resource standards. Do not have to be below 250 percent of FPL. Participants must be between the ages of 16 and 64. Section 1902(r)(2) allows states to use less restrictive income and resource methods than SSI. New optional eligibility groups are Basic Coverage Group and Medical Improvement Group. Section 1902(r)(2) allows states to use less restrictive income and resource methods than SSI. New optional eligibility groups are Basic Coverage Group and Medical Improvement Group.

16. 16 Other Work Incentive Programs Social Security Disability Insurance (SSDI): trial work period of 9 months Supplemental Security Income (SSI): gradual reduction in benefits 1619 (a) 1619 (b) Disability Program Navigators (DPNs): assist individuals with disabilities in accessing services at One-Stop Career Centers 1619 (a): allows SSI recipients to have earned income over the Substantial Gainful Activity amount without losing their SSI eligibility. 1619 (b): allows SSI recipients to retain Medicaid and earn up to state income eligibility level. As of December 2006, section 1619 (a) had 17,394 people enrolled and section 1619 (b) had 89,350 people enrolled.1619 (a): allows SSI recipients to have earned income over the Substantial Gainful Activity amount without losing their SSI eligibility. 1619 (b): allows SSI recipients to retain Medicaid and earn up to state income eligibility level. As of December 2006, section 1619 (a) had 17,394 people enrolled and section 1619 (b) had 89,350 people enrolled.

17. 17 Medicaid Infrastructure Grants Medicaid Infrastructure Grants (MIGs) were authorized by TWWIIA to provide funding for states to facilitate the employment of people with disabilities through: Medicaid Buy-In programs Improvements to Medicaid services that support employment Coordinated, cross-programmatic approaches to remove barriers to employment 40 states, plus the District of Columbia, currently have a MIG. Most MIG states also have a Medicaid Buy-In program.

18. 18 Ten Things to Know About Health and Disability Policy Medicaid facilitates independent living in the community for people with disabilities. Medicaid support services include: Home and Community-Based Services (HCBS) Rehabilitation services Personal care services Durable medical equipment Home and Community-Based Services (HCBS) are on the rise. In 1994, represented 19 percent of Medicaid LTC spending In 2004, represented 36 percent of Medicaid LTC spending

19. 19 Ten Things to Know About Health and Disability Policy The Deficit Reduction Act of 2005 (DRA) provides opportunities to expand new services to people with disabilities. Benchmark Benefit packages Self-Directed Personal Assistance Services New options to provide HCBS Cash and Counseling Money Follows the Person

20. 20 Ten Things to Know About Health and Disability Policy Medicaid fills in the gaps in Medicare coverage. 7 million “dual eligibles” – low-income seniors and people with disabilities who qualify for Medicaid and Medicare. A person with a disability must wait 24 months to become eligible for Medicare. Medicaid provides coverage when Medicare is not immediately available. Medicaid provides long-term care services and “wrap-around” coverage for services not covered by Medicare. 42% of all Medicaid expenditures are for individuals who are also on Medicare.42% of all Medicaid expenditures are for individuals who are also on Medicare.

21. 21 Ten Things to Know About Health and Disability Policy Medicaid provides comprehensive services for youth with disabilities. Half of the 1 million children with severe disabilities age 4 and under receive Medicaid benefits. 30 percent of the 5.3 million children ages 5 to 17 with disabilities receive Medicaid benefits. “Katie Beckett” option (TEFRA option) States also cover children in foster care. “Katie Beckett” option (TEFRA option): allows non-poor families who cannot afford to keep a child with costly medical needs at home, to be able to do so. Foster care: both Title IV-E (required) and non-IV E enrollees (optional).“Katie Beckett” option (TEFRA option): allows non-poor families who cannot afford to keep a child with costly medical needs at home, to be able to do so. Foster care: both Title IV-E (required) and non-IV E enrollees (optional).

22. 22 Ten Things to Know About Health and Disability Policy Fluctuations in state fiscal conditions impact the ability of Medicaid to provide services for individuals with disabilities. Rate of growth in Medicaid spending slowed since 2000 and hit record lows in Fiscal Year 2006. States are improving program efficiency and investing in new services, innovations, and provider payment rates. Medicaid also must respond to rising health care costs, erosion of employer-sponsored health coverage, enrollment growth, and pressure to increase provider rates. States must balance their budgets. In FY 2007, states budgeted for total spending growth of 5 percent and state spending growth for Medicaid of 6 percent. States must balance their budgets. In FY 2007, states budgeted for total spending growth of 5 percent and state spending growth for Medicaid of 6 percent.

23. 23 Ten Things to Know About Health and Disability Policy Demographic and enrollment trends are impacting Medicaid programs. Aging population Growth in disability rolls In the next few decades, demographers are predicting that the elderly will account for a growing share of the U.S. population. The number of people enrolled in Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) is continuing to increase. In the next few decades, demographers are predicting that the elderly will account for a growing share of the U.S. population. The number of people enrolled in Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) is continuing to increase.

24. 24 Trend: Aging Population

25. 25 Trend: SSDI Enrollment, 1970-2005 Source: Annual Statistical Report on the Social Security Disability Insurance Program, 2005 Social Security Administration, September 2006, Chart 2

26. 26 Challenges and Issues Some health services can only be obtained in the home and not in the workplace. Complexity of work incentive programs. Barriers posed by asset limits. Number and scope of definitions of “work” and “disability.” Sustainability of initiatives such as Money Follows the Person and Demonstration to Maintain Independence and Employment. Pressures on state budgets. Age of transition for youth with disabilities. Impending restrictions on targeted case management and the rehabilitation option.

27. 27 For More Information APHSA web sites: Center for Workers with Disabilities: http://cwd.aphsa.org National Association of State Medicaid Directors: http://www.nasmd.org Contact: Martha Roherty, Director (202) 682-0100 ext. 229 mroherty@aphsa.org