For some weeks now, we've been waiting to hear what the Centers on Medicare and Medicaid Services (CMS) would say regarding those newly qualifying for Medicaid because of the Affordable Care Act. Friday they finally released a letter to state Medicaid programs, but that letter does not seem to clarify much.
You can read about it here: Implementing Health Reform: Medicaid Asset Rules And The Affordable Care Act and the actual letter they sent is in pdf form here.
The letter begins:
Dear State Medicaid Director:The letter continues for several more pages in similar fashion. Between all those acronyms it might not be easy to extract the meaning, but for starters, we can see that in the first sentence their focus at least at the start is not on the average new Medicaid enrollee aged 55-64 who may be subject to estate recovery, but mostly on those people who "receive coverage for long-term services and supports (LTSS)."
This letter provides guidance to states on how the long-term services and supports-related rules, including the estate recovery rules, in section 1917 of the Social Security Act (the Act), and federal regulations at 42 C.F.R. 435.700, et seq., apply to individuals who are eligible for Medicaid under Modified Adjusted Gross Income (MAGI) eligibility rules (“MAGI individuals”) and receive coverage for long-term services and supports (LTSS). The vast majority of people in need of Medicaid-covered LTSS will qualify under eligibility categories related to age or disability. The MAGI rules do not apply to these categories, and states generally are not required to offer LTSS in the Alternative Benefit Plans (ABPs) that are available to MAGI individuals. However, some people who need LTSS may qualify for Medicaid under MAGI rules. In particular, MAGI individuals who are medically frail or otherwise meet one of the benefit plan exceptions listed in 42 C.F.R. 440.315 must be offered the option of a benefit plan that includes Medicaid state plan services. For most adult beneficiaries receiving state plan services, medically necessary nursing facility and home health services must be covered. Additionally, some states have chosen to include LTSS in their ABPs.
Further along, they do say some things that seem to apply to perhaps more than just people who receive LTSS:
For the second group—those who were 55 years old or older when they received medical assistance and are described in 1917(b)(1)(B)—the rule is not limited in its application to individuals who were subject to post-eligibility income rules, or to individuals who received services to which the post-eligibility income rules apply (i.e., institutional services and HCBS). MAGI individuals who were 55 years old or older when they received medical assistance are therefore not exempt from the estate recovery provision in section 1917(b)(1)(B), although all of the estate recovery limitations and exceptions described in other parts of section 1917(b), including those described in section 1917(b)(2), and the exception in situations of undue hardship described in section 1917(b)(3)(A), apply.If I understand this correctly, the new ACA enrollees are the "MAGI individuals."
And in case you're wondering, as far as I have been able to find out, there exists no standard in any state that practices estate recovery as to what exactly constitutes "undue hardship."
Due to the potential barrier to enrollment that future estate recovery may create for some individuals, CMS intends to thoroughly explore options and to use any available authorities to eliminate recovery of Medicaid benefits consisting of items or services other than long term care and related services in the case of individuals who are determined eligible for Medicaid benefits using the MAGI methodology.That seems clear enough: they noticed that estate recovery was a barrier to enrollment. They will use "any available authorities" to limit estate recovery to long term care and related services. So, by this point in the letter, they are apparently talking about all affected MAGI enrollees, not just those in long term care.
The question is: does CMS have any "available authorities" in this regard?
In the meantime, states have some existing authority to limit the scope of recovery for Medicaid beneficiaries. They may limit recovery based on the eligibility categories in which the beneficiaries are enrolled; for example, a state may limit estate recovery to the services under section 1917(b)(1)(B)(i) for people enrolled in the new adult group – that is those relating to LTSS."In the meantime" - that sounds like if they do have any "available authorities" they don't expect to be able to find them and exercise them quickly. Can CMS overrule laws passed by state legislatures saying the state will apply estate recovery to all expenses, given that a federal law told the states they were welcome to pass such laws?
It appears that this letter confirms that MAGI/ACA Medicaid enrollees are in fact subject to estate recovery; that CMS is not sure whether it can do anything about that; that they hope states will take action to exempt MAGI/ACA Medicaid enrollees who are not receiving long term care from estate recovery.
Of course, some states (OR, WA) have already done this. Many others don't seem to be in a hurry to do so. (See Estate Recovery and the ACA: drastic differences between states ). So the CMS letter confirms what we already know, and leaves most of the big questions up in the air, twisting in political winds (with help from ALEC.)
What will it take to get the richest country in the world to provide health care to low income people without taking their assets? Stay tuned.
Previous diaries on this subject begin here: Medicaid Estate Recovery + ACA: Unintended Consequences?