Medicaid Tips for Families
Having a child with serious illness or disability can be overwhelming, and the costs of medical care can be extraordinary. Even families that have private health care insurance can find themselves financially ruined when the treatment their child needs is not adequately covered by their policy.
Fortunately for many children with special needs, Medicaid may provide coverage for:
- hospital stays
- doctor visits
- durable medical equipment
- personal care assistance
- home modifications
Understanding Medicaid can be difficult and confusing, but Red Treehouse can help with answers to questions.
What is Medicaid?
Medicaid is the single largest source of health insurance in the United States and currently covers approximately 73 million Americans including more than 3 million Ohioans. Approximately 20% of Americans (including one out of every three children) is covered by Medicaid. Medicaid, which is jointly funded by the federal government and state governments, provides health insurance to low-income and needy people, including children and adults with disabilities. Medicaid became law in 1965 along with Medicare (insurance primarily for individuals 65 and older) and can be found in Title XIX of the Social Security Act.
Check out the links below to learn more about Medicaid.
Who is eligible for Medicaid?
Medicaid provides healthcare coverage to low-income and needy people, including children and adults with disabilities. Although Medicaid is a joint federal/state program, it is administered by the states. Therefore, who qualifies varies from state-to-state. Both financial and non-financial criteria are considered.
The Affordable Care Act (ACA) gave states the opportunity to expand Medicaid coverage to most low-income Americans under age 65. This Medicaid expansion program allowed states to cover people with income up to 138% of the federal poverty level (FPL) regardless of whether they have a disability or not. The federal poverty level is determined annually by the Department of Health and Human Services and FPL data by household/family size. To date 31 states (including Ohio) and the District of Columbia have expanded Medicaid coverage.
Some states have elected to provide Medicaid to children with severe disabilities regardless of their family income. Because rules for eligibility are different in each state, it is important for families to understand the rules in their own state.
The following links provide helpful information regarding eligibility for Ohio and other states.
The Health Policy Institute of Ohio publishes a summary of Medicaid in Ohio which details the Medicaid eligibility requirements for various groups of Ohioans. The 2017 version of this document is available at Ohio Medicaid Basics 2017.
Are Medicaid and CHIP different?
Yes, these are two distinct programs. The Children’s Health Insurance Program (CHIP) became law in 1997 under Title XXI of the Social Security Act. Like Medicaid, it is a joint program between the federal and state governments. CHIP allows states to use federal matching funds to provide health coverage to children whose families have income too high to qualify for Medicaid, but who can’t afford private insurance.
For an overview of the qualification requirements for both programs, visit the links below.
How do I apply for Medicaid?
You can apply for Medicaid in person, online, by mail, or by telephone. The Ohio Department of Medicaid has detailed instructions for each method at instructions. In Ohio, the OhioDepartment of Job and Family Services (JFS) is responsible for processing Medicaid applications. Information about the Ohio JFS including contact information for each of the 88 county offices can be found at Department of Job and Family Services.
Thirty-two states and the District of Columbia have begun automatically enrolling individuals in Medicaid once they have been approved by the Social Security Administration (SSA) for Supplemental Security Income (SSI). Currently Ohio maintains different eligibility rules for Medicaid and continues to require a separate Medicaid application. However, this may change in the future.
What do I need to do to make sure my child remains Medicaid eligible?
Like Supplemental Security Income (SSI), Medicaid is a needs-based entitlement program intended to help people with low income and minimal assets. Once your child has been qualified for Medicaid, you need to be careful to manage assets that are in your child’s name and income that can be attributed to your child to preserve Medicaid eligibility.
For children, asset management can be more problematic than income management. The asset limit for Medicaid eligibility for an individual is $2,000. Example: If a child receives a gift, inheritance, or personal injury settlement that puts their total assets over $2,000, they will lose Medicaid. Families are often faced with the dilemma of how to save for their child’s future without hurting Medicaid eligibility.
Asset Management Tools for those with Special Needs
Two important tools that can help children with special needs and their families resolve this issue are Special Needs Trusts and ABLE Accounts. (ABLE accounts in Ohio are known as STABLE accounts.) For information about Special Needs Trusts, see Special Needs Alliance. For information about Ohio Stable Accounts, see STABLE. Note: establishing a Special Needs Trust can be complicated and families will most likely need to legal help to do so.
STABLE accounts (authorized by the 2014 ABLE Act) can be very simple to open especially for children who are already SSI eligible. In 2016, Ohio became the first state in the nation to offer ABLE accounts, which allow contributions up to $14,000 per year with no impact on Medicaid or SSI eligibility. If an individual’s ABLE account grows to more than $100,000, there is an impact to SSI. However, Medicaid eligibility is preserved.
The ABLE National Resource Center provides additional helpful information about ABLE accounts. Because of how easy it is to open an ABLE account, this might be a good place for families to start. Some families may still benefit eventually from establishing a Special Needs Trust.
What are Medicaid Managed Care Plans?
Once a person obtains Medicaid coverage, they use Medicaid through one of two delivery systems: (1) fee-for-service or (2) managed care plans. In the early days of Medicaid almost all states used the fee-for-service system exclusively. Under fee-for-service systems, Medicaid paid providers (doctors, hospitals, etc.) directly for every unit of service delivered. This system gave providers an economic incentive to provide as many services as possible to a patient, which contributed to rising Medicaid costs.
In the last decade, most states have moved away from pay-for-service systems to managed care plans. Managed care plans are privately operated health insurance companies that contract with providers to deliver Medicaid covered services to people who are enrolled.
Currently about 83% of Ohio Medicaid recipients are receiving services through managed care plans. Ohio has five managed care plan providers:
Soon after a person in Ohio is enrolled in Medicaid, they will be asked to select a managed care plan. If they do not, one will be selected for them. Medicaid recipients who are enrolled in managed care plans can switch plans every November during an open enrollment period.
To learn more about Medicaid managed care plans, check out the links below.
What are Medicaid Waivers?
Medicaid waivers allow states to use federal Medicaid funds to provide community-based services to people with disabilities who would need to be in a nursing home, hospital, or other residential setting without them.
Waivers can be used to pay for services, such as:
- personal care assistance
- respite care
- accessibility home modifications
- specialized medical equipment
Each state offers its own waiver programs which are not transferable state-to-state.
Waiver Waiting Lists
Most states have waiting lists for waiver programs. In some cases, individuals will be on a waiting list for a waiver for years before receiving services. Because the process can take so long, families should learn about and apply for waivers as soon as their child is approved for Medicaid. For an overview of the waiver programs that exist in each state, visit MedicaidWaiver.org. Additionally, MyChild at CerebralPalsy.org provides a Medicaid Waivers overview that can answer many questions that families may have.
Ohio currently has several waiver programs. Good information about each type of waiver is available from the Ohio Department of Medicaid, Cuyahoga County Job and Family Services and the Ohio Department of Developmental Disabilities (DODD).
Are there things that only Medicaid will pay for and things that Medicaid may not pay for?
Things that only Medicaid will cover
Medicaid is the only type of health insurance (public or private) to pay for long-term care. For families with children who have disabilities or serious chronic illness, this means that Medicaid is essential, even if the family has private health insurance.
Things that Medicaid may not cover
People are sometimes surprised to learn that Medicaid does not cover everything. Although states are required to cover many services and procedures (mandatory benefits), other services and procedures are classified as optional. That means Medicaid in some states may cover them and in others may not.
Examples of optional benefits, which may not be covered by Medicaid, include prescription drugs, dental care, prosthetics, and eyeglasses. Medicaid.gov provides a list of mandatory and optional Medicaid benefits. Fortunately, Ohio Medicaid covers many of the optional benefits. The Health Policy Institute of Ohio provides a comprehensive list of covered optional services at Ohio Medicaid Basics.
How does Medicaid interact with Private Insurance and Medicare?
Many people who have Medicaid also have private health insurance and/or Medicare. This may seem surprising. Many people who need long-term services and support, which are typically only covered by Medicaid, or who have extensive medical needs that are not adequately covered by other insurers require both. Medicaid is considered the “payer of last resort.” This means that for people who have Medicaid and either private health insurance or Medicare, Medicaid will pay only after those programs have paid as the primary insurance.
The following resources explain how Medicaid works with other types of health insurance.
Does Medicaid vary state to state?
Yes, although all Medicaid programs must follow minimum federal guidelines, the programs are managed by the states and do vary from state-to-state. Families with children who have special needs need to understand this because a move from one state to another can impact eligibility, coverage, and waiver status. The Kaiser Family Foundation provides information about total Medicaid spending by state. Additionally, the Centers for Medicare & Medicaid Services provides profiles about each state’s Medicaid programs at Medicaid.gov.
Will the potential repeal and replacement of the Affordable Care Act (ACA) impact Medicaid?
Yes, families whose children receive Medicaid will want to monitor closely changes to the ACA or any replacement healthcare law that may be enacted. This is a very fluid situation. It is impossible to know what the impact to Medicaid will ultimately be until, and unless, the ACA is repealed, and a new healthcare law is enacted.
Many of the “repeal and replace” bills that have been introduced to date have sought to end the Medicaid expansion program that was authorized by the Affordable Care Act (allowed states to expand Medicaid coverage to people with income up to 138% of the Federal Poverty Level). If the Medicaid expansion program is repealed, it is likely that some people currently covered by Medicaid will no longer be eligible. The Kaiser Family Foundation monitors current proposed replacement healthcare laws and provides an overview of what could result if the proposed laws were enacted.
Parents of children with special needs know that it is important to advocate for their child (visit advocacy guide). Regardless of what political beliefs parents have, it is helpful to know who the key elected officials are and how to contact them to express opinions for or against any proposed laws that may change their child’s healthcare coverage. USA.gov provides contact information for federal, state, and local elected officials. Parents can use this site to find phone numbers and email addresses for their Senators and Representatives.
This guide was developed as part of a project made possible by a Grant from the Ohio State Bar Foundation. The views expressed herein do not necessarily represent those of the Ohio State Bar Foundation.
Lead researcher/author: Helen Livingston Rapp, Esq., RedTreehouse.org Legal Intern