A Guide to Medicaid and Medicaid Waivers

Medicaid is a federal public health insurance program created to provide health care to the following groups of low income individuals:

Families with Children,
Pregnant Women and Children,
Aged,
Blind and Disabled

To be eligible for Medicaid, a person must belong to one of these groups and meet the financial criteria for that group.

A disabled person must have a physical or mental impairment, disease, or loss (verified by a physician) that will result in death or that has lasted or
appears reasonably certain to last for a continuous period of at least 12 months.

Financial criteria for disabled persons varies, depending on if they are enrolled in MEDWorks or are receiving services under a Medicaid Waiver.

Medicaid Financial Eligibility
When a person with a mental or physical disability applies for Indiana's Medicaid Disability program eligibility is based on more than disability.
The person's income must be below a specified maximum.
For unmarried persons, the current maximum  is $603 a month.
If the person is married, their combined income can be a maximum of $904.

Assets must also be below a specified maximum.
For an unmarried individual, the current maximum is $1,500.
If the person is married, the current maximum is $2,250 for the couple.

If a person who is disabled has excess income and/or excess assets, he can receive Medicaid through what is called "spend-down."

Here is how spend-down works: Each month, to be eligible for Medicaid in that month, a person's medical expenses must equal his spend-down. Once medical expenses equal spend-down, then Medicaid coverage is available to that person for the remainder of the month. For example, if a person's medical expenses equal his spend-down on the 10^th day of the month, from the 10^th day of the month forward, he will have Medicaid coverage for the remainder of the month.

When Medicaid is approved, the person will receive a notice giving the spend-down amount. This amount is determined through a formula set by Medicaid. The formula subtracts the person's income and/or assets from the maximum allowed.

Financial Eligibility and Indiana's Medicaid Waiver Programs
Indiana's Medicaid waiver programs for Home and Community-Based Services exclude parental income and assets from counting when determining a minor child's eligibility for a Medicaid waiver. However, all of these waiver include their minor child's income and assets. Thus, if their minor child who is disabled has too much income or assets, eligibility for one of these waivers is jeopardized.

The Developmental Disabilities and Support Services waiver, also modify the income that an applicant or recipient (minor or adult) can have and still be eligible for either waiver. Thus, under these waivers, spend-down, because of excess income, is still possible, but less likely.

Under the Developmental Disabilities and Support Services waiver, the income limit is $1,635 a month. Only if a person's income exceeds $1,635 a month, would spend-down come into play. Individuals receiving any Medicaid Home and Community-Based Service waiver are subject to the same asset limit as those not receiving waiver services.

Determining Spend-Down Under Medicaid Wavier Programs
People who are eligible under any of the Medicaid waivers are eligible to receive that waiver's specially approved services. They are also eligible to receive services available through Medicaid Disability. If these persons are subject to spend-down, they have only one spend-down. They can use the Medicaid Disability services to meet their spend-down as well as the special waiver services.

Financial Eligibility Under MED-Works - Medicaid for Employees with Disabilities
MED Works is a category of eligibility for Medicaid. It is intended for people who are disabled and work, and whose income and/or assets are more than the amounts allowed for Medicaid Disability These workers use MED Works in lieu of spend-down (which is part of the Medicaid Disability program).

It is only available to people who are disabled and who, because they work, have income or resources that exceed the limits for the Medicaid Disability program.

A person who is disabled is also eligible for MED Works if his gross earnings exceed the substantial gainful activity amount established by the Social Security Administration.
For 2003, this amount is $800 a month for non-blind persons with disabilities and $1,330 for blind persons with disabilities.

The maximum countable income limit is based on 350% of the federal poverty level for a family of one. Effective July 1, 2002, the standard is $2,585 a month.

Impairment-related expenses are excluded when determining countable income. Allowable impairment-related expenses include, but are not limited to, payments for attendant care services, medical devices, prosthetic devices, work-related equipment, residential modifications, and transportation costs.

MED Works recipients pay a monthly premium
Unlike spend-down, which is part of the Medicaid Disability and Medicaid waiver programs, a MED Works recipient pays a monthly premium. The premium under MED Works is less than spend-down under the Medicaid Disability and Medicaid waiver programs.

The premium is based on the gross income of the recipient and the recipient's spouse. It is based on a percentage of the federal poverty level.

No premium is assessed if income is below one hundred and fifty percent (150%) of the federal poverty level for an individual and married couple. At this time, the premiums are as follows:

Important Tips
1. Medicaid does not require that you pay your medical expenses in order for these expenses to count for spend-down.   Of course, you do have an obligation to your medical providers to pay your bills. However, for the purpose of meeting spend-down, Medicaid counts both paid or unpaid expenses.

2. If you have old bills from before you were eligible for Medicaid, those bills can be used to meet spend-down if you are still legally liable for them.

3. A married couple has one spend-down amount for both husband and wife, even if only one spouse receives Medicaid. The couple's combined medical expenses are used to meet spend-down. When spend-down is met, either husband or wife or both are eligible for the remainder of the month.

4. The asset spend-down described above does not apply to everyone whose assets are over the limit. It applies only to people receiving SSI or who meet SSI financial requirements.

If your assets are more than $2,000 (the SSI limit), asset spend-down won't apply to you in that month. You can, however, still reduce your assets to become eligible for Medicaid, but your eligibility cannot start until the next month when they are within the Medicaid limit. Here is an example of how you can reduce your assets in one month to become eligible for Medicaid in the next month: In May, your assets total $2,100. The maximum allowed is $1,500. You spend $600 from your assets. In June, your assets are now $1,500 and you meet the asset limit. In this example, you were not eligible for Medicaid in May, but you were eligible in June.

Medicaid Covered Services for People with Disabilities
Medicaid brings federal tax dollars back to Indiana B for every dollar spent on Medicaid in Indiana, the federal government pays approximately 63 cents, and Indiana pays approximately 37 cents.

The federal government requires that states receiving federal funds for Medicaid include certain "mandatory" services - such as hospital services, and allows states to offer a variety of  "optional services" - such as dental care and eyeglasses.

Mandatory Medicaid Services
The federal government requires that states receiving federal funds for Medicaid include the following services:

Outpatient hospital services
Inpatient hospital services
Rural health clinic
Laboratory and x-ray services
Nursing Facility and home health services for those age 21 and over
Nurse midwife services
Family planning services and supplies
Physicians' services and medical & surgical services of a dentist
Nurse practitioners' services
Early/periodic screening diagnosis & treatment for people under age 21

Optional Medicaid Services
In addition to mandatory Medicaid services, states may offer optional services under their state Medicaid program. The following optional services are offered under Indiana's Medicaid program:

Dental services
Emergency hospital services
Hospice care
Inpatient psychiatric services for those under age 21
Home Health Services provided by home health agency (under age 21)¹
Transportation services
Nurse anesthetists' services
Occupational therapy
Physical therapy
Prescription drugs
Private duty nursing services
Psychological services
Respiratory care services
Speech, hearing, and language disorder services
Extended Services for Pregnant Women²
Chiropractic Services
Clinic Services
Diagnosis services
Eyeglasses
Inpatient hospital services for those over age 65 in institutions for mental diseases
Intermediate Care for the Mentally Retarded (group homes and large facilities)
Nursing Facility Services for those under age 21
Optometry services
Podiatrists services
Preventive services
Prosthetic devices
Rehabilitative services
Screening services
Durable medical equipment