Congress Debates Cuts to Vital Health Care Benefits
by John Tschida
As health care costs and insurance
premiums continue to rise, proposals that would affect people with
disabilities are advancing in Washington and at the State Capitol.
Of greatest concern is a federal proposal that would strip the authority
of states to require health plans to provide certain services or
medical supplies.
The Health and Insurance Marketplace Modernization Act (S.1955),
sponsored by Sen. Michael Enzi (R-Wyoming), has already passed the
U.S. House. A vote is expected this month in the Senate.
Enzi has called the proposal the greatest effort in the last decade
to make health insurance more affordable to small businesses and
working families. Opponents say the bill will hurt consumers and
block access to critical health services.
U.S. Senator Norm Coleman, a bill supporter, has said the measure
will significantly lower the per-person coverage costs for small
businesses. U.S. Sen. Mark Dayton opposes the bill and backs a separate
health care savings proposal that would leave the state mandates
intact.
Current Minnesota law
mandates the coverage of over two dozen benefits, including diabetes
health strips and testing supplies, hearing aids for kids under
18, special dietary foods for kids born with phenylketonuria (PKU),
and mental health services equal to that of other health care.
Additionally, Minnesota law requires that certain providers, such
as speech, physical, and occupational therapists, be covered by insurance
plans. Newly adopted children and children with disabilities— even
after they reach adulthood—must also be covered (A law passed
by the state legislature in 2005 allowed health plans to design coverage
that would not include all of the state mandated services, but it
did not affect the provider or population-based mandates).
Opponents of such mandates, like the Council for Affordable Health
Insurance, have long held that dictating specific services that must
be covered only serves to drive up the cost of health care premiums.
Consumer advocates say without such requirements, health insurers
would not include the services in their benefits packages.
What is undeniable is that the number of people nationwide who are
covered by employer-sponsored health insurance continues to decline,
from 69 percent to 60 percent over the last 20 years, according to
Harvard economist David Cutler. Not only are fewer businesses offering
health insurance, but fewer workers are taking the insurance offered
by employers, especially among younger adults.
It’s also important to note that businesses that are self-insured,
meaning those state businesses and organizationsrather than ‘skilled’ by
commercial insurers, include bathing and dressing assistance for
those whose disability makes independent performance of these tasks
impossible. Other examples of services not paid for by private market
insurance but covered by Medicaid through the waiver programs include:
independent living skills, adult day services, and case management.
On the federal level, cost pressures have put the Medicaid program
under the microscope. Both Congress and the Bush administration have
called the increasing federal outlays for the Medicaid program unsustainable.
Cuts narrowly passed as part of the Deficit Reduction Act will mean
that Minnesota will lose $85 million in targeted case management
funds that flow to county human services agencies. Perhaps of more
concern is the flexibility Congress has given to the states to alter
their Medicaid benefit sets while charging enrollees more for monthly
premiums and co-payments.
Actions at the state level are seriously questioning whether the
status quo is affordable. Proposals advancing at the State Capitol
would allow the Department of Human Services (DHS) to look at developing
alternative benefit sets for different populations. Seniors, for
example, could have a very different service menu than people with
disabilities. Within DHS, difficult questions are already being asked
about the current program entitlements. In a difficult fiscal environment
with public health care programs comprising the fastest growing part
of the budget, advocates must be prepared for this discussion.
At least one state program
seeks to maximize the unique strengths of the public and private
insurance worlds to the benefit of people with disabilities. The
state Medical Assistance for Employed Persons with Disabilities,
or MA-EPD program, allows people with disabilities to enter the
workforce and retain access to their Medicaid benefits. Approximately
6,000 are enrolled in MA-EPD. If an employer offers health insurance
coverage, the private insurance pays first, and Medicaid serves
as a secondary policy to cover what the private plan will not pay
for. Without the critical ‘gap’ coverage
that Medicaid provides (such as non-skilled home care services),
many of these individuals could not afford to work—paying for
these uncovered services out-of-pocket is simply cost prohibitive.
In other cases, private
insurance plans have ratcheted down how much they will pay for
expensive ‘ancillary’ benefits,
such as durable medical equipment (DME). DME coverage, which many
plans covered at 100 percent just a decade ago, now typically is
covered at 70-80 percent. In the case of a wheelchair or hoyer lift,
these expenses can quickly become onerous. Currently, about 17 percent
of MA-EPD enrollees have commercial or private insurance through
an employer. This figure has remained stable over the last several
fiscal years.
The Impact on People with
Disabilities
So as employers seek
to offer less expensive —and less comprehensive—benefit
packages, and private market reforms such as S.1955 come closer to
passage, what effect do these changes have on people with disabilities?
Leaving public assistance programs such as Medicaid and SSI or SSDI
to take a job that requires a switch to private health insurance
is a risk that today many individuals with disabilities are unwilling
to make. Congressional and state actions that create even leaner
insurance benefits may be more affordable, but are also less attractive
to people with complex medical needs and chronic conditions. In the
long run, additional disincentives for people with disabilities to
enter the workforce only shifts insurance costs from the private
sector and onto public programs, which today cover the most expensive
and hard to serve populations. And in an environment of fiscal austerity,
legislators will continue to examine how to slow the growth in Medicaid
spending by looking at how dollars flow toward people with disabilities,
for whom Medicaid is essential for maintaining health, independent
living, and quality of life outcomes.
