MEDICAID MATTERS TO MEDICARE BENEFICIARIES AND THEIR FAMILIES
Medicare and Medicaid - together serving
over 80 million Americans - are our two major national public programs that
offer secure and stable access to health care to their beneficiaries and peace
of mind to the families of those beneficiaries. They both represent, in the
words of President Bush, the binding commitment of a caring society.
Medicaid is under attack by the President's proposal that
would turn the program into a block grant and would eliminate current program
structures that provide important protections to vulnerable older people and
people with disabilities. Medicare beneficiaries and their advocates should be
concerned about this proposal.
Who uses Medicare and Medicaid?
Both Medicare and Medicaid provide benefits to older people
and people with disabilities; in addition, Medicaid provides benefits to
pregnant women and families with children.
Medicaid matters particularly to the more than six million
Medicare beneficiaries who are eligible for both programs. It also matters to all
Medicare beneficiaries because Medicaid contributes nearly 20% of all personal
national health care spending, thus being a significant source of support for the
health care infrastructure of the United States.
Why do Medicare beneficiaries need Medicaid?
Medicare has high cost-sharing in the form of premiums,
deductibles and co-insurance, and significant gaps in its coverage, most notably
prescription drugs and long-term care.
The six million Medicare beneficiaries eligible for some
Medicaid coverage are generally poorer and sicker than the general Medicare
population and thus are greater users of health services. They comprise 17% of
Medicare enrollees, but use 24% of Medicare expenditures. They comprise 19% of
Medicaid enrollees and use 35% of Medicaid dollars.
Assistance with Medicare Cost-sharing.
Medicare has high cost-sharing requirements: more than $700
in premiums for Part B alone, nearly $1,000 in deductibles for an individual
with one hospitalization in the year, and 20% of the cost of every physician
visit. For some dually eligible beneficiaries, Medicaid pays just the Part B
premium; for others, Medicaid assumes responsibility for all the cost-sharing,
relieving the beneficiary of liability for the payments.
Assistance with services not covered by Medicare
For those Medicare beneficiaries eligible for full Medicaid
services, Medicaid fills in gaps in Medicare's coverage such as prescription
drugs, vision and dental care, and non-skilled long-term care. For example, more
than 90% of those who are dually-eligible rely on Medicaid's prescription drug
benefit, with an average use of more than three prescriptions per month.
Because of the high cost of long-term care - nursing homes
can cost more than $60,000 per year - many Medicare beneficiaries become
eligible for Medicaid to pay for this care after they have spent most of their
own resources. Medicaid pays for some of the care for 60% of all nursing home
residents and pays nearly half of all nursing home costs in the country.
How will President Bush's Medicaid proposal hurt
dually-eligible Medicare beneficiaries?
The President's proposal gives significant flexibility to
states to change current Medicaid requirements. The changes would explicitly
affect all Medicaid beneficiaries and all Medicaid services that are not
required to be covered by federal law. Such so-called "optional"
groups include 56% of older people and 22% of people with disabilities, the
populations comprising the dually eligible. More than 80% of Medicaid spending
for older people and over 65% of spending for people with disabilities is for
"optional" services. Most nursing home beneficiaries are
"optional" and virtually all community-based long-term care services
Under the proposal, states could restrict services to those
parts of the state that are less costly to serve. They could require high
cost-sharing, limit prescription drug coverage to certain kinds of drugs or to a
fixed number of prescriptions, regardless of whether that number met most
people's needs. They could have waiting lists, allowing only a specified number
of people to apply for nursing home coverage. They could require adult children
of nursing home residents - who might be putting their own children through
college or caring for their own health needs - to pay part of the cost of the
nursing home bill. States could put liens on the property of family members of
Medicaid beneficiaries, or recover from their estates.
For Medicare beneficiaries with low incomes, or those who need long-term care, Medicaid fills the gaps in Medicare's coverage to minimize out-of-pocket expenditures, reducing them from 20% of income for the average beneficiary to 5% for those with full Medicaid. This extra coverage provides security to those beneficiaries who most need health care services, and provides peace of mind to families who know that their relatives' health care needs are met.
Copyright © Center for Medicare Advocacy, Inc. 09/04/2013