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.
