Is Med­i­caid ex­pan­sion re­duc­ing dis­abil­ity claims?

Modern Healthcare - - NEWS - By Vir­gil Dick­son —with Rachel Lan­den and Paul Demko

The num­ber of Americans ap­ply­ing for Sup­ple­men­tal Se­cu­rity In­come (SSI) ben­e­fits dropped in the first six months of this year com­pared to the same pe­riod last year, and ex­perts are de­bat­ing whether the de­cline is partly re­lated to the health­care re­form law’s Med­i­caid ex­pan­sion to low-in­come adults.

A to­tal of 1,189,567 SSI claims— most re­lated to phys­i­cal or men­tal dis­abil­ity—were filed in the first six months of 2014, com­pared with 1,330,169 dur­ing the same pe­riod last year, a drop of 10.6%, ac­cord­ing to data ob­tained by Mod­ern Health­care from the So­cial Se­cu­rity Ad­min­is­tra­tion through a Free­dom of In­for­ma­tion Act re­quest. The to­tal de­cline in SSI claims in states that ex­panded Med­i­caid in the first six months of 2014 was 11.2%, com­pared with 10.0% in non-ex­pan­sion states.

At the same time, the un­em­ploy­ment rate across the U.S. dropped as well, fall­ing 1.1% be­tween June 2013 and June 2014. The av­er­age rate of the de­crease was the same in Med­i­caid-ex­pan­sion and non-ex­pan­sion states.

The rea­son some ex­perts say ex­pand­ing Med­i­caid to child­less adults up to 138% of the fed­eral poverty level may have re­duced SSI claims is be­cause qual­i­fy­ing for SSI ben­e­fits au­to­mat­i­cally makes a per­son el­i­gi­ble for Med­i­caid in 39 states. It’s thought that one ma­jor rea­son peo­ple ap­ply for SSI is to re­ceive Med­i­caid cov­er­age. But with the Med­i­caid ex­pan­sion to low-in­come adults this year un­der the Pa­tient Pro­tec­tion and Af­ford­able Care Act, those in ex­pan­sion states no longer have to ap­ply for SSI to get Med­i­caid. In ad­di­tion, ex­perts say that be­ing able to ac­cess med­i­cal and be­hav­ioral care through Med­i­caid cov­er­age may make it pos­si­ble for peo­ple with dis­abil­i­ties to stay in the work­force.

“Peo­ple turn to SSI when they are des­per­ate—no work, no in­come, no in­surance,” said David Au­tor, an eco­nomics pro­fes­sor at Mas­sachusetts In­sti­tute of Tech­nol­ogy. “If Med­i­caid takes care of their med­i­cal costs, they may be able to con­tinue seek­ing work or work­ing at low wages.”

In ad­di­tion, if ex­pand­ing Med­i­caid drives down SSI claims, that could save states money, be­cause the fed­eral gov­ern­ment picks up a much higher per­cent­age of the tab for Med­i­caid cov­er­age ob­tained un­der the ACA ex­pan­sion than it does for ben­e­fi­cia­ries who en­roll through SSI.

But other ob­servers say the im­prov­ing U.S. econ­omy is re­spon­si­ble for the dip in SSI-claim ap­pli­ca­tions, not Med­i­caid ex­pan­sion. “It’s not clear to me that the drop in claims is be­cause of Med­i­caid,” said Joseph An­tos, a health­care economist with the Amer­i­can En­ter­prise In­sti­tute, which op­poses the Af­ford­able Care Act. “Ob­vi­ously 2014 is bet­ter than 2013 be­cause the econ­omy is im­prov­ing.”

The Med­i­caid-ex­pan­sion states show­ing the steep­est drops in dis­abil­ity claims were North Dakota (19.9%), Rhode Is­land (18.5%), Arkansas (16.8%), West Vir­ginia (17.6%) and Ken­tucky (15.0%). The non-ex­pan­sion states show­ing the sharpest SSI-claim drops were Wy­oming (19.2%), Ne­braska (17.1%), Maine (16.8%) and Idaho (15.1%). Michi­gan, with a 19.9% drop in SSI claims, ex­panded its Med­i­caid pro­gram ef­fec­tive April 1, 2014.

The data show that 68% of ex­pan­sion states that ex­panded Med­i­caid start­ing Jan. 1, 2014 had per­cent­age de­clines in dis­abil­ity claims greater than 10%, whereas 50% of the non-ex­pan­sion states had de­clines greater than 10%.

Some legislators in ex­pan­sion states say they are pleased that Med­i­caid ex­pan­sion may have played a role in re­duc­ing dis­abil­ity claims. “With Med­i­caid ex­pan­sion, we are see­ing peo­ple who are get­ting their health into com­pli­ance and are ac­tu­ally able to get back into the work­force,” said Bar­bara Sears, a Repub­li­can state rep­re­sen­ta­tive in Ohio who sup­ported her state’s ex­pan­sion.

SSI is a needs-based fed­eral pro­gram funded by gen­eral rev­enues that pro­vides monthly cash ben­e­fits for peo­ple who are age 65 or older, blind, or dis­abled. About 8.1 mil­lion Americans re­ceived monthly ben­e­fits in 2013, up nearly 20% from a decade ago, ac­cord­ing to the So­cial Se­cu­rity Ad­min­is­tra­tion. Of those who got SSI in 2013, nearly 7 mil­lion peo­ple re­ceived pay­ments be­cause of a dis­abil­ity. Fed­eral spend­ing on the SSI pro­gram in 2013 to­taled $53.4 bil­lion, up from $51.7 bil­lion in 2012. State ex­pen­di­tures for SSI have held steady at $3.3 bil­lion for the last few years.

Fed­eral law gen­er­ally re­quires states to ex­tend Med­i­caid to SSI re­cip­i­ents. But the law al­lows states to es­tab­lish their own el­i­gi­bil­ity re­quire­ments, and 11 states re­quire peo­ple to ap­ply sep­a­rately for SSI and Med­i­caid.

Some ex­perts cau­tion that the drop in SSI claims would have to con­tinue for sev­eral years at a greater pace in ex­pan­sion states than non-ex­pan­sion states to demon­strate that Med­i­caid ex­pan­sion was the likely cause of the de­cline.

Arkansas State Sen. Jonathan Dis­mang, a Repub­li­can who sup­ported Med­i­caid ex­pan­sion, said he hoped that ex­pand­ing Med­i­caid would re­duce the num­ber of peo­ple in the SSI pro­gram. “It’s too early to say with any cer­tainty that’s the case,” he said. “I think there’s an in­di­ca­tion there has been an im­pact.”

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