Abstract

This is a brief summary of a complex topic. It should not be considered a complete guide to the Medicaid program. These are the changes to the laws that became effective on April 1, 1990.

Medicaid eligibility

States have broad discretion when deciding, within Federal guidelines and with Federal medic assistance percentage (FMAP), which groups their Medicaid programs will cover, and what financial criteria they must meet to be eligible for Medicaid. States must provide Medicaid enrollment to persons who are eligible for federally-assist income maintenance assistance payments. These are the mandatory Medicaid eligibility categories:

Recipients for Aid to Families with Dependent Children (AFDC) and two-parent, unemployed households whose cash assistance, the State has chosen to limit. This includes a limited extension for those who are unable to work or lose AFDC.

Supplemental Security Income (SSI), recipients or persons aged, blind or disabled in States with more restrictive eligibility requirements.

Children under 6 years old whose family income is less than 133 percent of the Federal poverty line.

Certain Medicare beneficiaries (described below).

Adoption assistance and foster care recipients under Tide IV–E of the Social Security Act.

Other groups that are specifically defined (with limited protection).

States have the option of offering Medicaid enrollment to other "categorically needed" groups. These optional groups have the same characteristics as the mandatory ones but are more open to being enrolled if they meet certain eligibility criteria. These are the most extensive optional groups that States can enroll in (and receive FMAP funding for) under the Medicaid program.

Infants under 1 years old and pregnant women who are not covered by the mandatory rules, whose family income is below 185% of the Federal poverty line (the percentage that will be determined by each state)

Children under 8 years old, as well as aged, blind, and disabled adults whose incomes are higher than those required by mandatory coverage but lower than the Federal poverty level.

Children younger than 21 years old who meet the income and resource requirements for AFDC but are otherwise not eligible for AFDC.

Individuals who are institutionalized with income and resources below a specified limit.

Individuals who receive care under community-based and home-based waivers.

Recipients State Supplemental Payments

Persons who are "medically needy".

States have the option to make Medicaid eligible to certain individuals and families by creating a "medically Needy" program. This allows them to grant Medicaid eligibility to additional people or families who meet the eligibility criteria. However, they must have income that is higher than the minimum or optional categorically necessary levels but lower than the MN level for the state. Qualified persons can also "spend down," which means they may be eligible for Medicaid by paying medical expenses that lower their income to a level that is allowed under their state's plan.

A State may have a program for the medically vulnerable if it chooses. It must enroll children under 18 years old and pregnant women. It can also enroll in medically needy persons as aged, blind or disabled persons, caretaker relatives of children deprived from parental support, and certain other financial eligible children, up to the age of 21. In 1989, 39 states provided Medicaid to some or all of the following groups as part of a program for medically necessary people:

The Medicare Catastrophic Insurance Act of 1988 increases eligibility for Medicaid for certain nursing home patients. It also protects more family income and assets for institutionalized spouses.

Medicaid doesn't provide health care services to all people, but it does cover some of the most vulnerable. A person must be a member of one of the specified groups and meet income/resources requirements to be eligible for Medicaid. The Medicaid program, even under the most expansive provisions of Federal law (except for a few emergencies for certain people), does not provide health services for the very poor, except for those who are under 21 years old, pregnant, blind, or disabled.

Some states also offer additional "State-only" programs that provide medical assistance to certain poor people who are not eligible for Medicaid. These programs vary widely between States. These State-only programs do not receive matching Federal funds.

Services offered in terms of price and duration

States can determine the amount and duration of services they offer under their Medicaid programs within broad Federal guidelines. They can limit the amount of visits or days that are covered by their Medicaid programs. Except for certain circumstances, Medicaid plans in States must give beneficiaries the freedom to choose from a variety of providers of health care. States can provide and pay Medicaid services through pre-payment arrangements such as health maintenance organisations.

States are generally required to provide similar services to all categorically eligible enrollees. Two important exceptions are made: States may provide additional services only to a limited number of people.

States can request administrative waivers under which they provide an alternative package of health care for Medicaid-eligible persons. These waivers do not limit the services that states can offer, provided they are cost-effective. However, such waivers may not allow for room and board to waivered recipients.

The EPSDT program requires that Medicaid provide services to children who are identified as having a need. This applies even if the services are not part of the State's Medicaid plan.

Relationship between Medicare and Medicaid

Some elderly or disabled people are eligible for both the Medicare and Medicaid programs (Tide XVIII under the Social Security Act). These people are called "dual enrollees" and "crossover enrollees". Medicare provides both hospital insurance (Part A), and supplementary medical insurance, (Part B). Part A coverage is available to all persons over 65 years old or disabled who have been insured under Social Security. The monthly premium can be paid by other persons 65 years or older who are not covered by Social Security to get Part A coverage.

However, Part B coverage requires that you pay a monthly premium. The premiums, coinsurance, deductibles and deductibles for dual enrollees are paid by the state Medicaid programs. Medicaid supplement Medicare by providing certain health services that are not covered under Medicare such as hearing aids and eyeglasses.

The Medicare Catastrophic Insurance Act of 1988, which was not repealed in 1989, requires that State Medicaid programs start (on a phased basis) to pay Medicare premiums and deductibles for certain other aged and disabled "qualified Medicare beneficiaries (QMBs). QMBs are those who have incomes below 90 percent of the Federal poverty line (phased in at 100 percent by 1992) or with resources that are at or below twice that allowed under SSI. This ensures Medicare coverage for Medicare beneficiaries who aren't quite poor enough for Medicaid but would struggle to pay the Medicare copayments.

QMBs with resources and income above Medicaid eligibility are not eligible for full Medicaid coverage. They benefit from Medicaid's Medicare cost-sharing benefits. The Omnibus Budget Reconciliation Act of 1990 requires Medicaid buy-in of Part A Medicare coverage to disabled people who have lost Medicaid coverage due to their return from work.

Services rates

Medicaid functions as a vendor payment program. States pay providers of medical services for the care they provide to enrolled people. The Medicaid reimbursement rate must be accepted by providers in full. The payment rates must be high enough to allow sufficient providers to be enrolled under the plan. States should also increase payments to qualified hospitals that offer inpatient care to a high number of Medicaid enrollees or other low-income individuals.

The reimbursement method and rates for services are up to the states. Federal upper limits apply, but there are two exceptions. For institutional services, payment cannot exceed Medicare reasonable-cost rates. And for hospice care, they must pay Medicare rates.

Some Medicaid enrollees may be subject to copayments, coinsurance or nominal deductibles from the state. Enrollees must not pay copayments for emergency services or family planning services. This cost sharing must not be applied to certain Medicaid enrollees: pregnant women, children below 18 years old, hospital and nursing home patients expected to contribute most or all of their income to institution care, and categorically in need enrollees in healthcare maintenance organizations.