Benefits and Cost-Sharing for Working People with Disabilities in Medicaid and the Marketplace
Hypothetical Experiences of Working People with Disabilities
In light of the varied requirements and flexibilities pertaining to the design of benefit packages and to cost-sharing amounts in Medicaid and the Marketplace, and to illustrate the impact of different state policy choices on working people with disabilities, this issue brief considers the rules as they might affect representative individuals in different situations. The rest of this paper presents three profiles of hypothetical working people with disabilities and examines how their benefits and cost-sharing obligations may differ as they move between Medicaid state plan and new adult ABP coverage and between Medicaid and Marketplace QHPs. The analysis focuses on selected categories of benefits that are important to many people with disabilities, including mental health and substance use treatment services, prescription drugs, rehabilitative and habilitative services and devices, and LTSS.
The analysis considers the benefits and cost-sharing rules that apply to newly eligible adults in Medicaid programs in four selected states. It is important to note that if an individual who is eligible under the ACA’s expansion meets the definition of “medically frail” or also qualifies for Medicaid through a disability-related (non-MAGI) eligibility pathway, that individual must have access to all Medicaid state plan benefits, to the extent that state plan benefits may differ from those in the state’s new adult ABP. The analysis also considers the benefits and cost-sharing rules in representative QHPs in the four states’ Marketplaces.
The states included in this analysis are California, Kentucky, New Jersey, and Ohio. These states, all of which are implementing the ACA’s Medicaid expansion in 2014, were selected to illustrate different state policy choices about aligning Medicaid state plan benefits and new adult ABPs and about whether to operate a state-based or partnership Marketplace or to default to the FFM. This brief relies on Medicaid benefit and cost-sharing information from current state plans or applicable § 1115 demonstration waivers, and on states’ new adult ABP state plan amendments as approved by CMS. Benefit information for Marketplace QHPs is based on the summary of benefits for the Marketplace benchmark plan selected by the state. All QHPs must have benefit packages that are actuarially equivalent to the benchmark plan, so the benchmark plan coverage can be considered representative of what a person would find in a Marketplace QHP. Cost-sharing information for Marketplace QHPs is based on an actual 2014 silver-level plan considered to be representative in each state, with premium tax credits determined using the Kaiser Family Foundation’s subsidy calculator.1
It also is important to note that the actual coverage of specific services depends on an individual’s health condition, the recommendation(s) of a treating provider, and the state’s Medicaid medical necessity criteria or the applicable QHP coverage criteria. Also, this analysis is based on general language about covered categories of benefits in the sources described above; often, it is not possible to determine whether a specific service or item is covered by a plan until an actual claim is submitted. While the QHP benchmark plan used in this analysis is representative of what Marketplace QHPs cover, as noted above, plans may substitute actuarially equivalent benefits within the same EHB category. Therefore, the QHP coverage described in this brief is illustrative and not necessarily exactly what is available in all Marketplace QHPs in that state.
Table 3 summarizes the key Medicaid state plan and ABP benefits and Marketplace design choices among the states selected for this analysis. More detailed information about benefits and cost-sharing in each state’s Medicaid state plan and new adult ABP and representative Marketplace QHP is included in Appendix 1 and the methodology used to select the QHPs for the cost-sharing comparisons is included in Appendix 2.
|Table 3: Key Characteristics of Selected States’ Medicaid Benefits and Marketplaces|
Alignment of New Adult ABP with Medicaid State Plan Benefits
|Type of Marketplace|
|California||Aligned, but beneficiaries must meet medically frail criteria to access LTSS||State-based, active purchaser model; standardized deductibles, out-of-pocket maximums, and co-payments for all QHPs within same metal tier|
|Kentucky||Aligned||State-based, clearinghouse model|
|New Jersey||Not aligned – ABP offers additional behavioral health benefits and does not include certain LTSS||FFM|
|Ohio||Aligned except that ABP eliminates state plan utilization limits for certain behavioral health services||FFM|
Summaries of the three hypothetical profiles of working people with disabilities used in this analysis are presented below. The full profiles are included in Appendix 3.
Hypothetical 1: Susan, age 21, Diagnosed with mild cerebral palsy (CP)
Susan recently completed community college and transferred to a four-year college to complete her Bachelor’s degree. She lives on her own and works 25 hours per week as a cashier, earning $8.25 per hour. Her state has implemented the ACA’s Medicaid expansion, and her annual earnings of $10,725, or about 92% of the federal poverty level for a single adult in 2014, make her eligible for Medicaid in 2014. Susan is subsequently offered a job as a bookkeeper during her senior year of college. When she changes jobs, she continues working 25 hours per week, but earns $13 per hour. Her new annual earnings of $16,900, or approximately 145% FPL in 2014, make her eligible for Marketplace coverage with premium tax credits and cost-sharing reductions.
Susan’s needs for acute physical health and preventive services are the same as those of other, healthy young adults. She also has some additional medical needs associated with her CP diagnosis. Susan is able to walk but uses crutches or a power scooter when she travels significant distances, including getting around campus. Because Susan’s fine motor skills are mildly impaired, her family sometimes helped her button or tie clothing, prepare meals and do laundry when she was living at home. Susan had no plan for seeking assistance with her personal care needs when she went away to college, so they will likely be unmet, or performed to the best of her ability, without formal personal care services in place. She receives physical therapy twice a month to manage contractures stemming from muscle spasticity, and her physician believes she would benefit from weekly physical therapy and monthly occupational therapy to improve her fine motor skills. She takes prescription medication to control muscle spasticity, which is a common condition secondary to CP. While she is not currently in treatment for mental health issues, Susan was bullied in school because of her gait and use of crutches. She may have undiagnosed mild depression and/or anxiety as a result and might benefit from mental health diagnostic services, and if warranted, treatment.
Hypothetical 2: John, age 35, Diagnosed with clinical depression
John is a high school graduate with a limited work history as a seasonal day laborer for a local construction company. In three of the last five years, he earned approximately $15,000 per year, or about 129% FPL for a single adult in 2014. John’s state has implemented the ACA’s Medicaid expansion, and he is eligible for Medicaid in 2014. John was recently offered a year-round job as an assistant to an auto mechanic, earning $8.15/hour for a 40-hour work week. If he takes this job, John would make $16,952 a year, or about 145% FPL in 2014 and will become eligible for Marketplace coverage with premium tax credits and cost-sharing reductions.
John was first diagnosed with depression after a failed suicide attempt at age 32 when he was taken to the emergency department and involuntarily committed to inpatient treatment. John needs regular doctor appointments and takes a prescription anti-depressant medication. John’s doctor has encouraged him to seek individual and group therapy, but he has been unable to follow up on this recommendation because he previously was uninsured and unable to pay out-of-pocket. He also could benefit from regular preventive health care services.
Hypothetical 3: Mary, age 40, Diagnosed with multiple sclerosis
Mary finished high school but never went to college and currently works at a fast food restaurant. Mary works 30 hours a week at $8.25 per hour, with annual earnings of approximately $12,870, or about 110% FPL for a single adult in 2014. Her state has implemented the ACA’s Medicaid expansion, and she is eligible for Medicaid in 2014. Mary then decides to take a job selling tickets at a movie theater on the weekends, where she will earn $8.50 per hour. She will work 9 hours per week, earning$3,978 per year and bringing her total annual income to $16,848, or nearly 145% FPL in 2014. Once Mary takes her second job, she will become eligible for Marketplace coverage with tax credits and cost-sharing reductions.
Mary’s lack of health insurance and limited income have made it difficult for her to afford basic preventive health care, such as annual physical examinations. In January 2014, she visited the emergency department after experiencing an extended bout of blurred vision and muscle weakness and subsequently was diagnosed with multiple sclerosis. Mary now sees a neurologist, who recommended that she begin receiving regular doses of an injectable drug to slow the progression of the disease. He also referred her to a physical therapist for regular treatment of her muscular weakness and ordered some additional tests to assess the extent of impairment in her vision and fine motor functioning.