Med­i­caid a life­line for the poor and dis­abled

Modern Healthcare - - 50 MEDICARE AND MEDICAID THE NEXT HALF-CENTURY - By Vir­gil Dick­son

Be­fore Med­i­caid was es­tab­lished, low­in­come Amer­i­cans had limited ac­cess to health­care, re­ly­ing heav­ily on char­ity care and public hos­pi­tals. What ac­cess they had came through a patch­work of com­mu­nity and re­li­gious or­ga­ni­za­tions tar­get­ing the “de­serv­ing poor,” de­fined as sick or dis­abled chil­dren, preg­nant women, in­fants, the blind and the el­derly. If an “able-bod­ied” per­son needed health­care, how­ever, they gen­er­ally were out of luck.

“Be­fore (Med­i­caid), to be old and poor and sick was to suf­fer and to die pre­ma­turely,” said Tr­ish Ri­ley, ex­ec­u­tive direc­tor of the Na­tional Academy for State Health Pol­icy.

The health­care sit­u­a­tion for low-in­come and dis­abled Amer­i­cans im­proved sig­nif­i­cantly when Pres­i­dent Lyn­don John­son signed leg­is­la­tion es­tab­lish­ing Med­i­caid in 1965. Un­der the law, the fed­eral gov­ern­ment gave states match­ing funds for ev­ery dollar spent on the pro­gram. State par­tic­i­pa­tion was op­tional, and it wasn’t un­til 1972 that ev­ery state ex­cept Ari­zona had a Med­i­caid pro­gram. Ari­zona fi­nally im­ple­mented Med­i­caid in 1982.

From the mid-1980s to the early 1990s, Congress in­cre­men­tally ex­panded Med­i­caid el­i­gi­bil­ity. Law­mak­ers sev­ered the link be­tween Med­i­caid and wel­fare. By the start of the 1990s, all preg­nant women, in­fants and chil­dren un­der age 6 who had fam­ily in­comes be­low 133% of the fed­eral poverty level had to be cov­ered by the states. In 1997, Congress ap­proved a sep­a­rate pro­gram, the Chil­dren’s Health In­sur­ance Pro­gram, to ex­pand cov­er­age to chil­dren 18 years of age and younger in fam­i­lies with in­comes up to 200% of poverty.

Med­i­caid en­roll­ment reached nearly 40 mil­lion by 1993, and there was a push from Wash­ing­ton to find ways to re­duce pro­gram spend­ing. States be­gan to take ad­van­tage of demon­stra­tion waivers al­lowed un­der Sec­tion 1115 of the So­cial Se­cu­rity Act and shift parts of their Med­i­caid pop­u­la­tions from fee-for-ser­vice to man­aged care. By 1995, roughly one-third of Med­i­caid re­cip­i­ents, or 11.6 mil­lion, were en­rolled in man­aged-care plans, which were de­signed to cut costs and im­prove care.

While mil­lions of peo­ple got health­care cov­er­age through Med­i­caid, up to that point mil­lions of other low-in­come Amer­i­cans—mostly non-dis­abled adults with­out de­pen­dent chil­dren—still found them­selves with no af­ford­able cov­er­age op­tions. Some states at­tempted to serve this pop­u­la­tion through waivers and state pro­grams. Then, in 2010, the Af­ford­able Care Act re­quired states to ex­pand Med­i­caid to all adults who were U.S. cit­i­zens or legal res­i­dents with in­comes up to 138% of poverty, with an ini­tial 100% fed­eral con­tri­bu­tion, even­tu­ally phas­ing down to 90%. There were about 17.1 mil­lion unin­sured adults in that in­come range when the law passed, mak­ing up 37% of all unin­sured Amer­i­cans.

In 2012, the U.S. Supreme Court ruled that the fed­eral gov­ern­ment could not force states to ex­pand Med­i­caid un­der the threat of los­ing all their fed­eral Med­i­caid fund­ing, mak­ing ex­pan­sion op­tional. As of May 2015, 29 states and the Dis­trict of Columbia had vol­un­tar­ily adopted Med­i­caid ex­pan­sion. A num­ber of states with Repub­li­can gov­er­nors or leg­is­la­tures, in­clud­ing Arkansas, Iowa, In­di­ana and Michi­gan, have re­ceived Obama ad­min­is­tra­tion ap­proval to im­ple­ment their ex­pan­sions with con­ser­va­tive-friendly fea­tures such as pre­mium con­tri­bu­tions from ben­e­fi­cia­ries and re­liance on pri­vate health plans. In the wake of the ACA ex­pan­sion, the Med­i­caid pro­gram now pro­vides cov­er­age to nearly 70 mil­lion low-in­come and dis­abled Amer­i­cans.

For the rest of the Obama ad­min­is­tra­tion at least, there will be a con­tin­ued push from the fed­eral gov­ern­ment to per­suade the 21 hold­out states to ex­pand Med­i­caid. It’s es­ti­mated that 4 mil­lion more low-in­come adults could gain cov­er­age if those states ex­panded their pro­grams. Nearly 2 mil­lion of those peo­ple are in Florida and Texas. It’s likely that fu­ture state ex­pan­sions will in­cor­po­rate con­ser­va­tive prin­ci­ples of per­sonal re­spon­si­bil­ity, which ex­perts say will re­duce the num­ber of peo­ple cov­ered.

But if Repub­li­cans win the White House and hold Congress in the 2016 elec­tions, they are likely to push for elim­i­nat­ing Med­i­caid ex­pan­sion, cut­ting Med­i­caid spend­ing and giv­ing states greater state flex­i­bil­ity in the pro­gram.

One area of bi­par­ti­san agree­ment, how­ever, cen­ters on the need for re­form in Med­i­caid’s cov­er­age poli­cies for el­derly and dis­abled peo­ple who need long-term-care ser­vices. There is broad sup­port for shift­ing more care from in­sti­tu­tional set­tings to home- and com­mu­ni­ty­based set­tings. Med­i­caid cur­rently pays for about two-thirds of all long-term nurs­ing home res­i­dents’ care.

That shift is un­der­way. “We are mov­ing to­ward serv­ing peo­ple based on the best way to serve them as op­posed to say­ing, ‘If you need long-term care, you go into a nurs­ing home,’ ” said Cindy Mann, who un­til re­cently served as the CMS’ Med­i­caid direc­tor and is now a part­ner at the law firm of Manatt, Phelps & Phillips. By the end of 2015, she said, 50% of Med­i­caid spend­ing on long-term care will go to­ward com­mu­nity-based care.

I’ve seen the roller­coaster ride that Med­i­caid has been on be­cause so much of it is con­trolled by the in­di­vid­ual states. The chal­lenge has been to keep up with the change—some­times good change, some­times in­dif­fer­ent change and some­times bad change.

JOHN BLU­FORD FOR­MER CEO, TRU­MAN MED­I­CAL CEN­TERS

Med­i­caid’s in­suf­fi­cient re­sources some­times in­hibit ac­cess for those who need that care the most.

CHIP KAHN FED­ER­A­TION OF AMER­I­CAN HOS­PI­TALS

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