Article: Medicaid

Medicaid in the United States is a program managed by the states and funded jointly by the states and federal government to provide health insurance for individuals and families with low incomes and resources. Among the groups of people served by Medicaid are eligible low-income parents, children, seniors, and people with disabilities. Medicaid is the largest source of funding for medical and health-related services for people with limited income.

History and participation

Medicaid was created on July 30, 1965 through Title XIX of the Social Security Act. Each state administers its own Medicaid program while the federal Centers for Medicare and Medicaid Services (CMS) monitors the state-run programs and establishes requirements for service delivery, quality, funding, and eligibility standards.

Medicaid policies for eligibility, services, and payment are complex and vary considerably, even among states of similar size or geographic proximity. A person who is eligible for Medicaid in one state may not be eligible in another state, and the services provided by one state may differ considerably in amount, duration, or scope from services provided in a similar or neighboring state. In addition, state legislatures may change Medicaid eligibility, services, and/or reimbursement during the year.

Each state may have their own names for the program in their state. Examples include "Medi-Cal" in California, "MassHealth" in Massachusetts, and "TennCare" in Tennessee. States may bundle together the administration of Medicaid with other separate programs, such as the State Children's Health Insurance Program (SCHIP), and so the same organization that handles Medicaid in a state may also manage those additional programs as well. Separate programs may also exist in some localities that are funded by the states or their political subdivisions to provide health coverage for indigents and minors.

State participation in Medicaid is voluntary; however, all states have participated since Arizona created AHCCCS in 1982. In some states Medicaid pays private health insurance companies that contract with the state Medicaid program, while other states pay providers (i.e., doctors, clinics and hospitals) directly to ensure that individuals receive proper medical attention.

Medicare

Although their names are similar, Medicaid and Medicare are very different programs. Medicare is an entitlement program, while Medicaid is considered a form of social welfare. One criteria for Medicaid eligiblity is being impoverished under the program's guidelines, where this is not a consideration with Medicare.

While Medicaid and Medicare cover similar groups, there are important differences between them. For example, Medicaid covers a wider range of health care services than Medicare, and Medicaid does not have premiums, deductibles, and co-pays like Medicare. In 2001, about 6.5 million Americans were enrolled in both Medicare and Medicaid, also known as Medicare dual eligible.

Eligibility

Medicaid is a joint federal-state program that provides health insurance coverage to low-income children, seniors and people with disabilities. While Congress and the Centers for Medicare and Medicaid Services set out the main rules under which Medicaid operates, each state runs its own program. As a result, the eligibility rules are somewhat different in every state, although the framework is the same throughout the country.

Both the federal government and most state governments seem to be continually tinkering with the eligibility requirements and restrictions. This has most recently occurred with the passage of the Deficit Reduction Act (DRA) of 2005 (Pub.L. No. 109-171) [1] which significantly changed rules governing the treatment of asset transfers and homes of nursing home residents. The implementation of these changes will proceed state-by-state over the next few years. To be certain of your rights, consult an expert. He or she can guide you through the complicated rules of the different programs and help you plan ahead.

Additionally, the Deficit Reduction Act (DRA) of 2005 requires that anyone seeking Medicaid must produce documents to prove that they are a United States citizen, which is intended to prevent illegal immigrants from receiving coverage.

Budget

Unlike Medicare, which is totally federal, Medicaid is a joint federal-state program.[2] Each state operates its own Medicaid system, but this system must conform to federal guidelines in order for the state to receive matches and grants. This federal funding only pays for about half the state's Medicaid costs, with the states themselves funding the remainder.

Medicaid has become a major budgetary issue for many states over the last few years, with the program, on average, taking up a quarter of each state's budget. According to CMS, the Medicaid program provided health care services to more than 46.0 million people in 2001 [3]. In 2002, Medicaid enrollees numbered 39.9 million Americans, the largest group being children (18.4 million or 46 percent), and 40.4 million in 2003. It is estimated that 42.9 million Americans will be enrolled in 2004 with 19.7 million being children. Medicaid pays for nearly 60 percent of all nursing home residents and about 37 percent of all births in the United States.

Medicaid is also the program that provides the largest portion of federal money spent for health care on people living with HIV. More than half of people living with AIDS are estimated to receive Medicaid payments. Most often, poor people who are HIV positive must progress to AIDS before they can qualify under the "disabled" category. Two other programs that provide financial assistance to people living with HIV/AIDS are the Social Security Disability Insurance (SSDI) and the Supplemental Security Income.

Coverage of Long-Term Care

For all practical purposes, in the United States the only "insurance" plan for institutional long-term care is Medicaid. Lacking access to alternatives such as paying privately or Medicare, most people pay out of their own pockets for long-term care until they become eligible for Medicaid. In the absence of any other public program covering long-term care, Medicaid has also become the default nursing home insurance of the middle class.

Those who are not in immediate need of long-term care may have the luxury of distributing or protecting their assets in advance. This way, when they do need long-term care, they will quickly qualify for Medicaid benefits. Giving general rules for so-called "Medicaid planning" is difficult because every client's case is different. Some have more savings or income than others. Some are married, others are single. Some have family support, others do not. Some own their own homes, some rent. Still, a number of basic strategies and tools are typically used in Medicaid planning.

Important legislation

• 1965 PL 89-97 Medicaid
• 1997 PL 105-33 Balanced Budget Act (Children’s Health Insurance Program)