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Ohio’s Medicaid Program Overview Tim Duggan, UWCO Social Work Intern with Public Policy January 3, 2004

General Overview Medicaid pays for medical assistance for certain individuals of all ages and families with low incomes and resources. This program became law in 1965 and is jointly funded by the federal and state governments to assist in providing medical long-term care assistance to people who meet certain eligibility criteria. The federal government reimburses the state slightly more then 58 cents for every state dollar spent.

Medicaid is the largest source of funding for medical and health-related services for people with limited income.

Medicaid is an entitlement program meaning states cannot limit the number of eligible persons enrolled in the program or deny access to medically necessary services in order to control costs.

Brief Comparison of Medicaid and Medicare Medicare is a Federal health insurance program that serves all eligible beneficiaries without regard to income or medical history.

Eligibility: • People age 65 or older • Some people under age 65 with disabilities • People with End-Stage Renal Disease (ESRD), which is permanent kidney failure requiring dialysis or a kidney transplant Medicaid is a means-tested federal/state entitlement program.

Recipients must meet financial and categorical criteria. There is dual eligibility possibility for Medicare recipients that meet Medicaid criteria. Very low income elderly people on Medicare may also be eligible for Medicaid.

Eligibility (by category) • Children (200% Federal Poverty level) • Pregnant Women (150% Federal Poverty Level) • Parents or guardians (100% Federal Poverty Level) • Disabled/Elderly (65 and older) o 64% Federal Poverty Level United Way of Central Ohio Ohio’s Medicaid Program Overview - Page 1

o $490/mo (single) o $846/mo (married)

Growth of Medicaid in Ohio

The cost of Medicaid to the State of Ohio is about $10 billion this year, which will be paid by a combination of state and federal aid. As mentioned previously, the state is responsible for about 40%. Costs are projected to go up 13% in the fiscal year 2005 and 10% in fiscal year 2006. Nursing-home expenses, the largest segment of Medicaid spending, have risen more than 40% over the past eight years, while the number of nursinghome residents has decreased by approximately 4600 residents.

Due to these increases, the General Assembly created a panel in 2003 to look at ways to cut Medicaid expenses and to control its growth. The Ohio Commission to Reform Medicaid’s recently-released recommendations include: 1. Cut fees paid to nursing homes by 3%.

2. Freeze the reimbursement rate for hospital inpatient services.

3. Restrict drugs covered under Medicaid.

4. Increase the use of generic medications.

5. Expand in-home and community-based care.

6. Do not pay any bill until day its due.

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References: http://jfs.ohio.gov/ohp/bcps/FactSheets/index.st http://www.cms.hhs.gov/coverage/default.asp http://204.131.235.67/programs/health/forum/tickettowork.htm Access to Benefits Coalition Consortium, speaker: Cathy Levine, December 1, 2004.

Medicaid Buy-In Workshop: speaker: St. Sen. Steve Stivers, September 15, 2004.

Medicaid Buy-In Persons with disabilities who receive Medicaid have a disincentive to work in that any significant amount of earned income might cause them to lose Medicaid eligibility. The federal Balanced Budget Act (BBA) of 1997 and the Ticket to Work and Work Incentive Improvement Act of 1999 (TWWIIA) have given states increased flexibility to create a Medicaid buy-in program. If Ohio passes the enabling legislation that creates a Medicaid Buy-in program, an individual with a disability can seek employment without worrying about losing health insurance. MBI would allow working Ohioans with disabilities to pay into Medicaid to retain health coverage at a rate determined by the state based according income. MBI allows people with disabilities to get or keep Medicaid coverage so that they can be taxpaying, productive citizens The Cost of Medicaid Buy-in for Ohio Original estimates, as compiled by Steven R. Howe in his report to the Ohio Developmental Disabilities Council (Projecting Enrollment in a Medicaid Buy-in Program for Ohio), are that full implementation in five to seven years could reach an annual cost of $50 million, $20.4 being state responsibility. A significant portion of this cost is new United Way of Central Ohio Ohio’s Medicaid Program Overview - Page 3

monthly premiums for people not currently on Medicaid. It has been suggested that administrative start up costs and policy research and construction could seek appropriate grants to cover such expenses.

Senator Steve Stivers held a public hearing, at the MOBILE Center for Independent living, concerning his Medicaid Buy-in proposal.

Early projections show that the program may be cost neutral to Ohio after implementation. This will be because increased state revenue due to MBI recipients tax increase on their growing salary.

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