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The Affordable Care Act (commonly referred to as “Obamacare”) has been much in the news these days. Most of the noise has focused on problems with the Federal online exchange (www.healthcare.gov) where individuals can purchase health insurance.
A number of states declined to create their own exchanges, and chose instead to rely on the Federal exchange. New York is one of the states that created its own online exchange https://nystateofhealth.ny.gov. New York’s exchange is, so far, one of the more successful ones, with fewer glitches than www.healthcare.gov.
While the exchanges get sorted out, there are many other important questions to be answered. The legislation itself is very long (over 2,000 pages) and unwieldy, and many of the implementing rules and regulations remain to be determined.
Let’s start with those who do not need to be concerned about the Affordable Care Act. Those who have Medicare, or private insurance through an employer plan or individually, have no need to look for insurance on an exchange. Also, Supplemental insurance cannot be purchased on an exchange. The Act does not replace Medicare or other insurance.
However, many features and benefits of the Affordable Care Act do have an impact on seniors and individuals with disabilities. New programs are being rolled out that will affect those who qualify for both Medicare and Medicaid – so called “dual eligibles” — that change the way health care and long-term care is going to be provided.
Dual eligibles, especially those receiving long-term care, are among New York State’s costliest Medicaid beneficiaries, and the state has been actively trying to bring down these costs by redesigning the implementation of Medicaid. Those receiving long-term care benefits have already seen the implementation of managed care programs.
Now, with the Affordable Care Act in place, New York State is taking advantage of a federal grant that will further change the landscape for dual eligibles. Let’s take a look at some of the changes that will take place in 2014.
Traditionally, long-term care providers that were licensed by Medicaid were paid on a “fee for service” basis, at rates that were negotiated between Medicaid and the provider. The provider billed Medicaid for the specific services rendered to each patient, and Medicaid paid for these services.
Recently, in an effort to control the cost of this hugely expensive program, there has been a shift to a managed care system. Under the managed care system put in place, providers are paid a “capitated” rate. This means that Medicaid pays a flat amount to the managed care plan for each person who is enrolled in that plan. With regard to home care, Medicaid pays a set rate to the provider, no matter how many hours of care might be needed. Also, the managed long term care plans have taken over the functions previously performed by the local Medicaid offices, such as determining whether an individual needs home care, how many hours of care is needed, and contracting with an agency to provide the care.
New York State made enrollment in a Medicaid Managed Long-Term Care Plan mandatory for dual eligibles receiving community-based care on September 4, 2012. The program was rolled out over several months, starting first with New York City, and then to the other counties.
Two types of Medicaid Managed Long Term Care Plans were offered. The first type was a partially-capitated MLTC plan, which covered the long-term care (and other coverages) provided by Medicaid, but not the health and medical coverage provided by Medicare. The second type was a fully-capitated MLTC plan, such as the PACE and MAP plans, which fully integrated participants’ Medicare and Medicaid plans. Many individuals opted for the partially-capitated plans, because it gave them more freedom to see doctors outside of the Medicaid plan’s network.
Now, New York State is going even further with the managed care model by entering into a Federal-State partnership to establish a demonstration project that mandates the integration of Medicare and Medicaid under the umbrella of one plan. According to the new law, dual eligibles who are enrolled in an MLTC will have all of their medical, health, and long-term care needs covered and coordinated in one all-inclusive plan. The plans will be paid one capitated rate that covers the cost of both Medicare and Medicaid services.
This new Federal-State partnership is called the Fully Integrated Dual Advantage demonstration project, or FIDA. Under FIDA, those who are “FIDA eligible” will have to choose a FIDA plan, or they will be passively enrolled if they don’t make a selection. FIDA eligibility pertains to most dual eligibles who are over the age of 21 and reside in the FIDA demonstration counties of Bronx, Kings, New York, Queens, Richmond, Nassau, Suffolk and Westchester counties, and who are receiving long-term care. There are, however, several exceptions, such as individuals enrolled in the Assisted Living Program (ALP), or in the Traumatic Brain Injury (TBI) waiver program.
Though the phase-in is still under development, voluntary enrollment for individuals in need of community-based long term care services (greater than 120 days) is slated to begin in July 2014. In September 2014, passive enrollment will begin for individuals in need of community-based long term care. In October 2014, voluntary enrollment for individuals in nursing homes will begin. In January 2015, passive enrollment for individuals in nursing homes will begin.
FIDA plans will include all the services that are covered by the existing Medicare and Medicaid programs. However, those enrolled in FIDA plans will have limited provider networks of doctors, hospitals, and nursing homes.
Individuals who are not eligible for Medicare, but who have low incomes, may be able to qualify for Medicaid under a simplified procedure until they are 65 years of age. Under the Affordable Care Act, Medicaid eligibility is based on modified adjusted gross income (“MAGI”) as determined under IRS rules. Those who earn less than 138% of the federal poverty level will be eligible for Medicaid under a simplified application procedure.
Seniors 65 years of age and above will remain subject to Medicaid’s resource and income limits, and the five-year “look back” and “penalty period” in nursing home cases. Those who seek Medicaid benefits must continue to comply with the full application process, including all forms and documentation previously required.
As the implementation of the Affordable Care Act is likely to be a shifting landscape for some time, it’s best to check with an Elder Law firm for the current status and requirements of these programs and services.