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Medicaid Buy-In for Workers with Disabilities Donna Folkemer National Conference of State Legislatures and APHSA Center for Workers with Disabilities November 2003
What is a Medicaid Buy-In? • A separate Medicaid eligibility category, set up under state option and under state rules, for persons with disabilities who are working and who otherwise would not qualify for Medicaid. • The term “Buy-In” has been used to describe other Medicaid-related things, so it’s important to understand terminology.
Which States have Medicaid Buy-In Programs? • 12 States with Programs Authorized by Balanced Budget Act of 1997 • Alaska, California, Iowa, Maine, Mississippi, Nebraska, New Mexico, Oregon, South Carolina, Utah, Vermont, and Wisconsin. • 12 States with Programs Authorized by Ticket to Work Legislation of 1999 • Arkansas, Connecticut, Illinois, Indiana, Kansas, Minnesota, Missouri,New Hampshire, New Jersey, Pennsylvania, Washington, Wyoming.
States with Buy-In Programs (continued) • Two (2) states have similar programs now under the authority of a Section 1115 waiver: AZ and MA. • In 2003, 6 states passed Buy-In legislation. Those states are LA, MD, MI, ND, VA, WV. • Of these states, 3--MI, ND, and WV--called for starting programs in 2003. One state--LA--authorized a program by 1/04, one state--MD--authorized a program (subject to budget considerations) to begin by July 2005, and one state--VA--called for an 1115 waiver program.
States with Buy-In Programs • All told, 32 states with current program or some sort of future activity. • What about the others? No program authorized at this point. But working on through grant programs and stakeholder groups.
Medicaid Buy-In: Key ConceptsEligibility Group • Balanced Budget Act Eligibility Group • TWWIIA Eligibility Group • Major differences: • 250% of poverty maximum in BBA; no maximum in TWWIIA • No age limit in BBA; ages 16 to 64 in TWWIIA. • Processes for setting income and resource standards somewhat different.
Key Concept--Cost Sharing • Both BBA and Ticket Act make provision for beneficiary cost-sharing with states having flexibility in its design. • Most states use a premium structure with payments required for persons with incomes above a specified level. Two states use a co-payment system designed for this eligibility group. • About half of participants pay premiums. In 2002, average premium in states ranged from $12 to $321 per month.
How Many People Are Enrolled in Buy-In Programs Nationally? • 44,000 +/- as of December 2002. • 63,000 +/- since inception of program. • Number of enrollees varies from 150 (Washington State) to 8000 (Missouri).
Most Important Concept • Just as no two states have the same rules for other Medicaid categories, no two states have the same rules for their Medicaid Buy-in Programs. • Look carefully at program design features. • Look carefully at how program connects to other Medicaid groups.
Variation in Design Features • Income standard • Separate unearned income standard? • Asset rules • Asset accumulations possibility? • Premium structure and other cost-sharing features
Two State Examples • Minnesota • No income limit • Premiums of from 1% to 7.5% of income beginning at 100% of poverty based on gross income. • $20,000 Asset Limit • Retirement and Medical Savings Accounts not counted as assets.
Two State Examples • Maine • Person must meet two income tests: Countable earned and unearned income of less than 250% of poverty AND countable unearned income below 100% of poverty. • Asset limits of $8000 for individual or $12,000 for a couple. No asset accumulation feature. • Premiums begin at countable income level of 150% of poverty and are $10 or $20 per month based on income
Relationship to Other Eligibility Categories • Eligibility due to SSI status • SSI 1619(b) option • Medically needy programs • Optional poverty level category
Relationship to Other Eligibility Categories • For medically needy, replaces spend-down with predictable premium or no premium. • Thus may be particularly helpful to SSDI recipients who previously were spend-down. • For SSI people, helpful for those who want to retain more income and assets than possible under 1619(b).
Policy Issue • How to make Buy-In a real work incentive leading to increased earnings. • Definition of work not allowed, but some state are requiring FICA proof. • Buy-in does not change SSDI rules so there is still a cash cliff. • Premium structure and other design features influence enrollment, earnings, and service use, but more analysis needed.
Information Sources • The Medicaid Buy-In Program: Quantitative Measures of Enrollment Trends and Participant Characteristics in 2002. October 2003. Mathematica Policy Research (for CMS). • http://www.cms.hhs.gov/twwiia/mathrpt1003.pdf • http://cms.gov/twwiia/statemap.asp for state by state description of programs.
Information Sources • GAO Report: Medicaid and Ticket to Work: States” Early Efforts to Cover Working Individuals with Disabilities--June 2003. • Www.gao.gov/cgi-bin/getrpt?GAO-03-587 • State Medicaid Options that Support the Employment of Workers with Disabilities. By Pamela Hanes and Jessica Folkman. August 2003. • http://www.chcs.org/publications/pdf/cas/BuyIn.pdf