Why is medicaid an entitlement

These highly accessible essays examine Medicare and Medicaid from their origins as programs for the elderly and poor to their later role as a safety net for the middle class.

Along the way, they have served as touchstones for heated debates about economics, social welfare, and the role of government. Medicare and Medicaid at 50 addresses key questions for understanding the past and future of health policy in America, including:.

The volume's contributors go on to examine the powerful role of courts in these transformations, along with the shifting roles of Congress, public opinion, and state governors in the programs' ongoing evolution. Bush on the right, American political leaders have tied their political fortunes to the fate of America's entitlement programs; Medicare and Medicaid at 50 helps explain why, and how those ongoing debates are likely to shape the future of the Affordable Care Act.

Princeton University. Further discussion of Medicaid eligibility under these waiver programs is beyond the scope of this report. States are generally required to provide Medicaid coverage for SSI recipients. However, states may use more restrictive eligibility criteria than those of the SSI program if they were using such criteria in Individuals in receipt of SSI for a given month are usually eligible for Medicaid for that month.

SSI recipients typically become ineligible for Medicaid whenever their cash payments are suspended or terminated. In December , 8. Unless states elect the option discussed in the next section, they must provide Medicaid coverage for all SSI recipients. Section of the SSA allows states to enter into an agreement with the Social Security Administration for the agency to conduct Medicaid eligibility determinations and redeterminations for SSI recipients on the state's behalf.

Some states that provide Medicaid coverage for all SSI recipients choose to conduct their own Medicaid eligibility determinations and redeterminations. These states use the same standards and methodologies of the SSI program to determine Medicaid eligibility but require SSI recipients to file a separate Medicaid application with the state or local Medicaid office. States that elect this option are known as "SSI criteria states.

States that provide Medicaid coverage for only those SSI recipients who meet more restrictive eligibility criteria than SSI criteria are known as " b states," after the section of the Social Security Amendments of P. Table 3. Notes: b states apply at least one eligibility criterion that is more restrictive than SSI criteria in determining Medicaid eligibility for SSI recipients; however, any more restrictive eligibility criteria that are applied to SSI recipients may not be more restrictive than those contained in the state's Medicaid plan that was in effect on January 1, They must also allow SSI recipients to "spend down" or deduct incurred medical expenses from their income to the point where they meet the applicable income standard needed for Medicaid eligibility.

Because SSI program rules form the foundation of Medicaid eligibility criteria for the ABD populations, b states may apply their more restrictive eligibility criteria to most other eligibility pathways for ABD individuals, subject to the same terms and conditions discussed above.

Some states complement federal SSI payments with optional state supplementary payments SSPs , which are made solely with state funds. States may provide SSPs to all SSI recipients, or they may limit payments to certain individuals, such as residents of domiciliary-care facilities or blind individuals. SSP amounts, standards, and methodologies are determined by the states, pursuant to certain federal requirements.

States have the option to provide Medicaid coverage for individuals who receive only an optional SSP. In general, states must apply the same standards and methodologies to individuals under this pathway that they apply to individuals receiving SSI, including any standards or methodologies that are more restrictive than those of the SSI program in the case of b states.

Section of P. To receive federal Medicaid funding, states must provide a special payment, known as a mandatory SSP, to individuals who were converted from the former adult assistance programs to the SSI program if the individual's SSI payment plus other income from the current month is less than his or her December state grant amount plus certain other income.

The amount of the mandatory SSP is the difference between the current SSI payment and the individual's December payment under the former adult assistance program. Section 13 c of P. All states including [b] states are required to provide Medicaid coverage for individuals who are enrolled in the SSI program but have earnings above certain SSI limits. Under Section a and b of the SSA, individuals who would continue to be eligible to receive SSI if not for their earnings may be deemed to be receiving SSI for Medicaid eligibility purposes if they continue to work and meet certain other requirements.

Adults aged 65 and older may qualify for the provisions, provided they meet the SSI definition of blindness or disability. Individuals who live in b states must also have been eligible for Medicaid in the month immediately prior to becoming eligible for status. These a payments are calculated in the same manner as regular SSI payments and are payable for as long as an individual performs SGA and meets all other SSI eligibility criteria.

In addition to providing special payments, Section a requires all states to provide Medicaid coverage for a recipients on the same basis as they provide Medicaid coverage for regular SSI recipients. Section b of the SSA requires all states to provide Medicaid coverage for blind or disabled individuals who would continue to be eligible for regular SSI payments or a payments if not for their earnings. To qualify under this pathway, individuals must 1 continue to be blind or disabled, 2 meet all SSI financial eligibility requirements except for earnings, 3 need Medicaid to continue working, and 4 have earnings that are considered insufficient to provide a reasonable equivalent of the benefits that would be provided if they did not have those earnings i.

The Social Security Administration uses an annual earnings standard to determine when b eligibility ends. The agency calculates this standard based on the sum of. The standard varies from state to state, depending on the amount of the SSP if any and per capita Medicaid expenditures. In determining Medicaid eligibility, most states must disregard the applicable Social Security benefit or increases in that benefit from the special former recipient's countable income.

In most instances, b states have the option to disregard all, some, or none of the applicable Social Security benefit or increases in that benefit from the special former recipient's countable income in determining Medicaid eligibility. This pathway is often known as the "Pickle Amendment" after the late Representative J. Social Security provides widow er 's benefits starting at age 60, or at age 50 if the individual is disabled and meets certain other criteria.

The amount of the aged or disabled widow er 's benefit is based on the deceased insured worker's past earnings from covered employment, subject to a permanent reduction for each month of entitlement before the widow er 's full retirement age , depending on year of birth.

Under P. Disabled adult children of retired, disabled, or deceased insured workers typically qualify for Social Security disabled adult child's DAC benefits if they are at least age 18 and became disabled before they attained age Eligibility for Medicaid under this pathway continues until the individual becomes entitled to Medicare Part A.

Section E of P. Sections to of P. States must provide Medicaid for these groups if they continue to meet the respective eligibility criteria that were in effect in December , in addition to meeting certain other requirements.

Residents of public institutions are generally ineligible for SSI. The reduced SSI payment, known as a personal needs allowance PNA , is used to pay for small comfort items not provided by the facility.

Some states supplement the PNA i. However, federal law does not exempt such payments from being counted as income or resources under the SSI program. CMS regulations require states to provide Medicaid coverage for individuals who lost SSI eligibility because they received settlement payments.

States may extend Medicaid coverage to older adults and individuals with disabilities who have higher levels of income or resources than those permitted by SSI program rules under optional aged, blind, or disabled ABD eligibility pathways. In addition, some optional ABD eligibility pathways allow states to choose their own methodology for counting income and resources; others permit states to use less restrictive income- or resource-counting methodologies compared with SSI rules.

As previously mentioned, certain optional eligibility pathways for older adults and individuals with disabilities e. In addition, Medicaid gives states the option to extend eligibility to individuals who "spend down" or deplete their income on medical expenses, including LTSS, to specified levels.

Therefore, some individuals with higher levels of income and resources compared with those permitted under SSI rules may be Medicaid-eligible. States may employ a reasonable definition of a "family" for purposes of the individual's countable income. In general, states must use SSI rules in determining what income is counted or not counted. Only the applicant's income i. States may also use Section r 2 of the SSA to disregard additional income or resources.

Under the Special Income Level pathway, eligibility starts on the first of the 30 days that the individual resides in an institution. Thus, Medicaid can cover all of the care an individual receives in a nursing facility. In , 42 states and the District of Columbia used the Special Income Level to enable persons to qualify for Medicaid coverage of institutional care.

Section States use the highest income and resource standard of a separate eligibility group covered by the state plan under which an individual would otherwise qualify if institutionalized.

States must use the income- and resource-counting methodologies used to determine eligibility for this same eligibility group. States may also apply Section r 2 's more liberal income-counting rules to this group. This option is made available by extending the required and optional Medicaid state plan services, sometimes referred to as "traditional" Medicaid services, to individuals who are also receiving a targeted package of HCBS state plan services.

Unlike Section c HCBS waiver programs, which require that eligible individuals need the level of care provided in an institution e. States may choose to cover individuals under either or both income standards.

There are no resource standards for this eligibility group, with the exception for those individuals who seek to establish eligibility based on an approved waiver program. For these individuals, states must use the same income and resource standards and counting methodologies as applied to those individuals eligible under the applicable waiver program.

In , the most recent year for which data are available, 15 states and the District of Columbia offered at least one Section i HCBS State Plan option; however, only two states Indiana and Ohio used this state plan authority as an independent eligibility pathway to Medicaid. In addition, the state must determine that 1 the child requires the level of care provided in an institution, 2 it is appropriate to provide care outside the facility, and 3 the cost of care at home is no more than institutional care.

States electing this option are required to cover all disabled children who meet these criteria. States must use SSI income and resources rules to determine eligibility; however, only the child's income and resources, if any, are counted. Parents' income and resources are not counted.

A child's income cannot exceed the highest income standard used to determine eligibility for any separate group under which the individual would be eligible if institutionalized.

States may not use Section r 2 of the SSA to use more liberal income- or resource-counting methodologies. In , the most recent year for which data are available, 24 states and the District of Columbia offered the Katie Beckett pathway under their Medicaid state plan.

There are several optional Medicaid Buy-In eligibility pathways for working individuals with disabilities or working families who have a child with a disability. In general, individuals eligible under Buy-In pathways would be eligible for Medicaid except for the fact that their income is higher than the income standard allowed by the SSI program under Section b of the SSA, which varies by state. Medicaid Buy-In pathways are designed to allow disabled individuals to work and still retain their Medicaid coverage, or to use their Medicaid coverage to access wraparound services that are not covered under an employer-sponsored plan.

States can also impose premiums or other types of cost-sharing requirements on eligible individuals, which can be done on a sliding scale based on income. The extent to which states impose premiums and cost-sharing varies by state. In , the most recent year for which data are available, 44 states and the District of Columbia chose to offer coverage through at least one Buy-In pathway.

Each state determines what constitutes a "family" for the purposes of this eligibility group. In addition to the family income requirement, the applicant's unearned income must be less than the SSI income standard.

All earned income is disregarded. An individual's countable resources must be less than or equal to the SSI resource standard using the SSI resource-counting methodology. However, states may use Section r 2 of the SSA to disregard additional income or resources. States may use Section r 2 of the SSA to disregard additional earned income above the SSI-earned-income disregard, including disregarding all earned income. Individuals with disabilities eligible under this pathway must be aged 16 to 64 and meet the SSI program's applicable definition of disability.

Individuals eligible under the Medical Improvement Group were previously eligible under the Basic Eligibility Group but lost that eligibility because they were determined to have "medically improved," meaning they no longer meet the definition of disability under the SSI or Social Security Disability Insurance SSDI programs but continue to have a severe medically determinable impairment.

Similarly, states may use Section r 2 of the SSA to disregard additional earned income above the SSI-earned-income disregard, including disregarding all earned income. There is no resource standard or applicable resource-counting methodology. States must require certain parents of eligible children under the FOA optional coverage group to enroll in, and pay premiums for, family coverage through employer-sponsored insurance as a condition of continuing Medicaid eligibility for the child.

The Medically Needy option is targeted toward individuals with high medical expenses who would otherwise be eligible for Medicaid except that their income exceeds the income standards for other state-covered eligibility pathways. Individuals may qualify in one of two ways: either 1 their income or resources are at or below a state established standard, or 2 they spend down their income to the state-established standard by subtracting incurred medical expenses from their income.

Examples of medical expenses that may be deducted from income include Medicare and other health insurance premiums, deductibles and coinsurance charges, and other medical expenses included in the state's Medicaid plan or recognized under state law.

For individuals who spend down to Medicaid eligibility, states select a specific time period for determining whether or not the applicant meets the spend-down obligation, often referred to as a "budget period," which generally ranges from one to six months.

States that choose to offer the Medically Needy option must cover pregnant women and children under the age of 18, and may choose to extend eligibility to the aged, blind, or disabled, among other groups. However, nursing facility services are optional services that states may elect to cover for Medically Needy individuals. States also set the resource standards within certain federal requirements. In general, states must use SSI's applicable definition of disability when determining eligibility for the disabled eligibility group.

Table A-1 lists selected Medicaid eligibility pathways that cover older adults and individuals with disabilities. The table includes a brief description of each pathway, the age criterion for eligibility, whether the pathway is mandatory or optional, the Social Security Act citation, and any applicable regulatory citations. Table A-2 lists the income and resource standards, as well as the counting methodology, that applies to each standard for the selected Medicaid eligibility pathways that cover older adults and individuals with disabilities.

In general, standards or limits on the amount of income and resources required for eligibility are expressed in relationship to the federal poverty level FPL or the SSI federal benefit rate FBR.

Where applicable, the income standard is presented as a monthly dollar amount for an individual in For state-specific information on Medicaid eligibility pathways for older adults and individuals with disabilities, see the following resources:. Table A Aged, blind, or disabled individuals including SSI recipients who live in states that use criteria that are more restrictive than SSI criteria to determine Medicaid eligibility. Aged, blind, or disabled individuals receiving only optional SSPs because their income is at least equal to the SSI income standard but less than the SSP income standard.

Essential spouses, institutionalized individuals, and blind or disabled individuals who were eligible for Medicaid in December and continue to meet the eligibility requirements in effect for that month. Individuals who require care in a medical institution e. Individuals receiving HCBS waiver services who have an institutional level-of-care need and who would be eligible for Medicaid if institutionalized.

Children with disabilities who have an institutional level-of-care need and who would be eligible for Medicaid if they were in a medical institution.

Blind or disabled individuals who 1 have earned income and 2 who would, but for their earnings, be considered to be receiving SSI. Individuals who have earned income and who lose eligibility under the TWWIIA Basic group due to an improvement in their medical condition such that they are no longer considered to have a disability.

Children, adults, and aged, blind, or disabled individuals who are otherwise eligible for Medicaid but whose incomes are too high to qualify as categorically needy; and. The term "disabled" as it refers to the categorical criteria for eligibility under Medicaid, generally refers to the definitions of "disabled" for adults and children under the SSI Program.

The term "aged" refers to individuals aged 65 and over. The table does not include other mandatory or optional pathways that are available to children and adults where the basis of eligibility is not contingent on being blind or disabled e. Disabilities can be wide ranging and include, for example, physical limitations, visual impairments i.

Certain resources are disregarded, such as an individual's primary residence, one car, household goods and personal effects, and property essential to self-support. Either the SSI income standard or a lower income standard established by the state, provided such standard is no more restrictive than the one used by the state's Medicaid program in January Either the SSI income-counting methodology or a more restrictive income-counting methodology established by the state, provided such methodology is no more restrictive than the one used by the state's Medicaid program in January Either the SSI resource standard or a lower resource standard established by the state, provided such standard is no more restrictive than the one used by the state's Medicaid program in January Either the SSI resource-counting methodology or a more restrictive resource-counting methodology established by the state, provided such methodology is no more restrictive than the one used by the state's Medicaid program in January SSI resource-counting methodology; b states may use a more restrictive resource-counting methodology.

Either the SSI resource standard or the resource standard effective in the individual's state of residence for October , whichever is more advantageous to the individual certain exceptions apply. If the state uses the resource standard in effect for October , then state rules in effect at that time apply. SSI income-counting methodology; for b states, a more restrictive income-counting methodology may be used and eligibility is determined before the deduction of any incurred medical expenses recognized under a state plan.

SSI income-counting methodology; b states may use a more restrictive income-counting methodology. SSI income-counting methodology, except that income excluded under Medicaid law must be disregarded. SSI resource-counting methodology, except that resources excluded under Medicaid law must be disregarded.

It is also a major source of financing for care delivered by certain providers, particularly safety net institutions that serve both low-income and uninsured individuals. Like Medicare, Medicaid is an entitlement program. Eligible individuals have rights to payment for medically necessary health care services defined in statute; the federal government is obligated to fund a share of the outlays for those services.

Variability in Medicaid is the rule rather than the exception.