MassHealth and Free Care Updates
Joe Ianelli's CRC Presentation
Help! So much has been going on with the new state budget, I can't keep the changes straight! An information lifeline was offered by Joseph Ianelli, Administrative Manager for MGH Patient Financial Services and MGH Financial Access Unit when he spoke to social service staff at a special CRC presentation on October 30, 2003. This is an expanded version of his talk.
The programs Joe manages are Patient Financial Services (PFS) and the Financial Access Unit (FAU). The FAU may be less familiar to staff than PFS. Its function is to work with the insured to ensure that the proper notifications and prior-approvals are obtained to/from insurance companies. The Financial Access Unit is responsible for securing most of the hospital's net patient service revenue (NPSR).
The main number for PFS is x6-2191. A list of staff and areas they cover was shown on overhead and is available from PFS. In addition to helping with MassHealth eligibility, PFS staff helps patients get information about and apply for FreeCare, the Children's Medical Security Plan, Prescription Advantage and Healthy Start. They can also help with billing inquiries.
Joe reminded staff of the broader context of the healthcare crisis. Some statistics: the number of uninsured Americans grew by 5.7% in 2002 to 43.6 million. 15.2% were uninsured last year. Since 2001 the US has lost 2.7 million jobs and household income has fallen for 3 years in a row. In 2001, 62.6% received insurance through an employer, down to 61.3% in 2003, primarily due to cost. In Massachusetts, 6.7% or 418,000 residents were uninsured in 2002. Some estimate the current number is 500,000. Hispanic Adults and Blacks are disproportionally uninsured (24.2% of all adult Hispanics and 16.2% of all Black/non-Hispanic are uninsured). "The Perfect Storm" is the term Mr. Ianelli used for the combination of rising healthcare costs, the economic recession (and resulting unemployment) and state and federal budget pressures (including federal and state tax cuts). He reminded staff that in FY 01 the state had a $600 million surplus, and in FY 03 a $600-700 million surplus, but in FY 04 there is a projected $3 billion deficit. With a total budget of $24 billion a year, MassHealth accounts for about 25% of the state budget, so is an obvious target for budget reductions.
MassHealth Changes
Essential Eligibility criteria include:
Essential Benefits - The following services covered under Basic are NOT available under Essential:
For a married member whose spouse is in the community there have been protections in place for many years now to avoid impoverishing that spouse. Those protections were reduced as of last January. What hasn't changed is that the institutionalized member can keep $2000 in assets. Prior to January 1, of any remaining countable assets (such as cash, investments, etc.), the spouse could keep up to $90,000. While this seems like a lot, given that the spouse might live another 20-30 years it may not be. Since January 1 the spouse can keep only half of the assets. There is a maximum amount she can keep - no more than $90,960 (this amount is increased slightly every year). If half of the assets would be less than $18, 132 the community spouse can keep everything up to that amount. So for example, a couple with $92K- previously could keep the whole amount ($2K for institutionalized spouse + $90K for community spouse, now can keep $47K- $2K for institutionalized spouse + $45K for community spouse. A couple who has $22K would keep $20K- $2K for institutionalized spouse + $18K for the community spouse).
Income-First rule - went into effect 09/01/2003.
Prior to rule change: ON APPEAL (after MassHealth denial/spend-down notice) community spouse could make argument that she needs to retain additional ASSETS to generate INCOME sufficient to reach her MassHealth determined Minimum Monthly Maintenance Needs Allowance (MMMNA). If retaining all the assets still would not generate enough income to reach her MMMNA she could keep some of institutionalized spouse's income. Now the hearing officer uses the "income first" rule. So, ON APPEAL, if her income doesn't meet her MMMNA the hearing officer would first allow her to retain some of the institutionalized spouse's income. Only if that still does not bring her up to her MMMNA would the hearing officer then allow her to retain additional assets. The effect is that if she is allowed to retain any additional assets it would be less than under the old system. And if he is to die first, she will not have access to his income and her assets will have already been spent. But for MassHealth it means they have put out less money for the institutionalized members expenses.
Co-Pays are scheduled to go into effect in February 2004. Co-pays are expected to include: prescription drugs- $1/generic, $3/brand name; $3 for each hospital stay and $3 for non-emergency use of an emergency department. The acute hospital co-pay will not apply to admissions from long-term care facilities and admissions from an emergency department. DMA has implemented limits on co-pays to protect recipients with high usage: Rx cap is $200 per person, per year and Hospital Cap is $36 per person per year.
Asset Testing for the under 65 age group. This group has been exempt from asset limits since Health Care reform (1996). Asset testing is set to go into effect in February 2004. Asset limits will be $6,000 for most adults (parents, pregnant women, disabled adults, and HIV+ adults); $12,000 for working disabled adults; and $3,000 for unemployed adults. Advocates are seeking exceptions for disabled and pregnant women. Specifics regarding spend-downs are still being ironed out. Yet, the thought is that applicants with assets over the limit will be subject to a spend-down. Asset limits will be phased in as individuals come up for redetermination, but will immediately be applicable for new applicants.
Increase the look-back period for transfers of assets to qualify for long-term care from 3 years (5 years for trusts) to 5 years (10 years for trusts).
Change the penalty calculation for transfers of assets. Currently if an inappropriate transfer is found within the look-back period, DMA will divide the amount transferred by the average cost of a MA nursing home and come up with the number of days from the date of asset transfer that they would not pay a nursing home. DMA is seeking to change this so that the number of days DMA wouldn't pay for a SNF starts on the date of institutionalization or the date funds would have run out had the transfer not oc-curred, whichever came later.
Free Care (Uncompensated Care Pool)
Review of types:
Full requires Massachusetts residency, income-limit guideline 200% FPL
Partial also requires Massachusetts residency, income guideline is 200 - 400% FPL. Can also access through a spend-down if have qualifying medical expenses.
Limited does not require Massachusetts residency, but covers emergency services only. Income guideline is 200-400% of FPL.
The funding mechanism for the pool has changed for this Fiscal year with increases in payments from the state and federal governments and private insurers. The hospital payment has decreased, but there is expected to be a $72 million shortfall for FY04 which in effect will be covered by the hospitals (by my calculations about 13% of total).
The following is a list of changes that the Executive Office for Health and Human Services (EOHHS) is considering for the free care pool, starting in FY 05.
Critical Access - this is meant to redirect patients to the most cost-efficient facility. Generally, this parameter will dictate that people get their care in health centers unless the care is not available there. If people come to our ED for non-emergent care this would be a patient liability. But given the realities of trying to collect from these patients, the hospital would likely end up footing the bill.
Utilization Review - periodic checks of medical records to determine that pool funds were used appropriately by hospitals, e.g. making sure that a free care limited write off was truly emergent and that the patient would die within 24 hours if treatment were not provided.
Eligibility Verification - may link up with DOR to confirm. But DOR is up to 2 quarters behind in their data-entry.
Diversion Fine - for trying to dump free care patients.
Block Grant - no specifics forthcoming. This formula is being kept secret, but expect this will lead to serious shortfalls, especially with the changes in MassHealth forcing more people to rely on Free Care.
-Thanks to Joe Ianelli for his presentation and for his assistance in editing this article.
11/03