Overview of Medicare, Medicaid and State Children

1
Overview of Medicare, Medicaid and State
Childrens Health Insurance Program
forCitizens Health Care Working Group

• William J. Scanlon
• Health Policy RD
• National Health Policy Forum

2
Overview of Medicare, Medicaid and SCHIP

• Eligibility
• Services Covered
• Financing

3
Eligibility
Categories Income
Medicare -Aged -Disabled -ESRD Patients All
Medicaid -Children -Parents -Aged -Disabled Low Income--varies by state subject to federal limits
SCHIP -Children Low Income--varies by state subject to federal limits
4
Services
Acute Care Chronic Care Long-term Care
Medical, nursing and pharmaceutical services for an immediate need Medical, nursing and pharmaceutical services for an ongoing need Supportive services to compensate for a disability
5
Services
Acute Care Chronic Care Long-term Care
Medicare X X
Medicaid X X X
SCHIP X X
6
Financing

• Medicare
• Open Ended Entitlement
• Federal
• Payroll Taxes
• General Revenues
• Beneficiary Premiums
• Medicaid
• Open Ended Entitlement
• Federal and State General Revenues
• SCHIP
• Fixed Federal Appropriation
• Federal and State General Revenues
• Beneficiary Premiums

7
Medicare

• 41 million beneficiaries
• 301 billion in 2004
• 11.7 of Federal Budget
• 2.6 of GDP (2003)

8
Medicare Program Structure

• Original or Traditional Medicare (also known
  as Fee-for-Service Medicare)
• Medicare AdvantagePrivate plan options
• Drug Benefit

• Parts A and B

Part C
Part D
9
Medicare Benefits

• Medicare Covers Acute and Chronic Care
• Part A
• Inpatient hospital
• Post-hospital skilled nursing facility (SNF)
  services
• Home health
• Hospice-care
• Part B
• Physician and laboratory services
• Outpatient hospital
• Therapy
• Durable medical equipment and supplies
• Home health (not-covered under Part A)
• Part D
• Drugs

10
Medicare Cost-Sharing

• Hospital Care
• Days 1-60Deductible (912 in 2005)
• Days 61-90Per day coinsurance (228 in 2005)
• Days 91-150Per day coinsurance (456 in 2005)
  for 60 lifetime reserve days
• SNF
• Days 21-100Per day coinsurance (114 in 2005)

11
Medicare Cost SharingContinued

• Part B
• Deductible 110 in 2005
• Coinsurance 20 of Medicare approved amount
• Exceptions
• Mental health 50 co-insurance
• Hospital outpatientFixed amounts
• Home healthnone
• Over-billing limit 15 above Medicare approved
  amount on unassigned claims

12
Medicare Cost SharingContinued

• Beneficiary cost sharing on Medicare
• covered services can be substantial
• Beneficiaries in 1998 paying more than

Number of Beneficiaries Percent
2,000 3.4 million 11.5
5,000 736 thousand 2.5
10,000 167 thousand 0.6
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Medicare Supplementary Coverage

• Vast majority of beneficiaries in traditional
  Medicare have supplementary coverage

Supplementary Coverage in 2000
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Medicare AdvantagePart C

• Offers choice to join private plan
• Plan types include HMOs, PPOs, FFS, MSAs
• Plans paid monthly per enrollee fee regardless of
  services used
• Plan savings returned in extra benefits

15
Medicare AdvantagePart C

• Plan and beneficiary participation have varied
  over time

Plans
Enrollees (millions)
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Medicare AdvantagePart C

• Medicare Modernization Act changed Part C
• Increased payments to plans
• Provided for financial competition among plans
  and share of savings to Medicare
• Created regional PPOs to expand areas served

17
Medicare AdvantagePart C
PPO Regions for 2006
18
Medicare Drug Benefit--Part D

• Begins January 1, 2006
• Separate enrollment and premium
• Monthly premium expected to average 37
  nationally
• Benefit provided by competing private stand-alone
  drug plans or Medicare Advantage plans
• Benefit
• 250 deductible
• Coinsurance
• 25 from 250 to 2,250
• 100 from 2,250 to 5,100
• 5 on spending over 5,100
• Subsidies for premium and cost sharing for low
  income persons

19
Medicaid and SCHIP

• Medicaid
• over 52 million beneficiaries
• 309 billion in 2004
• Federal share
• 176 billion or .8 of federal budget
• State share
• 133 billion or 22 of state budgets
• 2003

• SCHIP
• 6 million beneficiaries
• 6.1 billion in 2004
• 75 Federal
• 25 State

20
Medicaid

• Program Roles
• Primary health insurancemostly families
• Medicare supplementdual eligible aged and
  disabled beneficiaries
• Long-term care financer beneficiaries with
  disabilities

21
Medicaid
22
Medicaid

• Programs are state designed and administered
  subject to federal requirements
• Result is 56 distinct Medicaid programs

23
MedicaidMandatory and Optional
EligibilitySelected Categories

• Mandatory
• Children
• 6-18 years up to 100 FPL
• 0-5 years up to 133 FPL
• Foster care
• Pregnant women
• Up to 133 FPL
• SSI cash recipients

• Optional
• Children and Pregnant women
• Up to 185 FPL
• Elderly and Disabled
• Up to 100FPL
• Medically Needy

24
Medicaid Mandatory Medicare Supplementary
Insurance

• Qualified Medicare Beneficiaries (QMBs)
• Up to 100 FPLPart B Premium and cost sharing
• Specified Low-Income Medicare Beneficiaries
  (SLMBs)
• 100-120 FPL---Part B Premium
• Qualifying Individuals (QIs)
• 120-135 FPLPortion of Part B Premium
• Qualified Disabled Working Individuals (QDWIs)
• Up to 200 FPL---Part A Premium

25
MedicaidMandatory and Optional ServicesSelected
Types

• Mandatory
• Physician
• Hospital inpatient and outpatient
• Nursing Facility for persons 21 and over
• Lab and X-ray
• EPSDT for persons less than 21

• Optional
• Prescription Drugs
• Dental services
• ICF/MRs
• Home and community-based services

26
Medicaid Waivers

• Program Waivers
• Mandatory managed care enrollment (1915(b))
• Section 1115 Demonstrations
• Statewide experimentation with financing
  mechanisms, managed care, coverage expansions
• HIFAHealth Insurance Flexibility and
  Accountabilitytradeoff of more limited benefit
  packages and cost sharing for expanded coverage

27
SCHIP

• Federal-State Partnership very different
• Capped appropriationnot an entitlement
• 39 billion for 10 years (reauthorization 2007)
• State Flexibility
• States can cap/close enrollment
• 7 states froze enrollment at least temporarily
  between 2001 and 2004
• 3 had freezes in effect at end of 2004

28
SCHIPState Flexibility (Continued)

• Benefits
• Medicaid Expansion
• Distinct program with benefits similar to
• BC/BS plan state employees plan largest
  Medicaid HMO or actuarially equivalent
• Combination
• Cost sharing
• Very limited for children in families 150FPL
• For others, premiums and co-payments allowed if
• 5 of income

29
Changes in Health Insurance Coverage for
Low-Income Children and Adults,
2000-2003Percentage Point Changes
Children
Adults
Change in Population
Change in Uninsured
Note Low-income is defined as less than lt200 of
poverty (29,360 for a family of three) SOURCE
Urban Institute for the Kaiser Commission on
Medicaid and the Uninsured, 2004
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Medicaid as LTC Financer

• Pays close to half of all LTC expenditures
• Nursing homes
• 46 percent of revenues
• 1 million or 2/3 of residents partially or fully
  financed
• Home and community services
• 48 percent of expenditures
• 850 thousand recipients

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Medicare and Medicaid as a Share of GDP
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For more informationUnderstanding Medicare and
Medicaid Fundamentals and Issues for the New
Congress Briefing Book January 26,
2005www.nhpf.org