Classen_HealthEcon_Class24

Classen_HealthEcon_Class24 - Medicaid, CHIP and Medicaid,...

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Unformatted text preview: Medicaid, CHIP and Medicaid, CHIP and the Uninsured Class 24 Loyola University Chicago Prof. Tim Classen March 25, 2011 Summary of Medicaid Summary of Medicaid Joint federal­state program Began in 1965 Financing States can have own eligibility standards, benefits package, payment rates and program administration under broad federal guidelines. As a result, there are essentially 56 different Medicaid programs – one for each state, territory and the District of Columbia. Roughly $400 billion program – double in next 10 years? Jointly financed by states and the federal government. Share paid by Feds is Federal Medical Assistance Percentage (FMAP). FMAP is matching rate inversely related to a state’s per capita income and can range between 50 to 76 percent. The federal share of administrative costs is 50 percent for all states. Federal spending (from general revenues) are determined by the number of people participating in the program and services provided. Averages roughly 2/3 of total Medicaid costs (gone up recently) Federal Medical Assistance Percentages (FMAP), FY 2010 WA MT OR ID WY NV CA NE UT CO KS OK ND MN SD IA ILIL MO IN KY TN AR MS TX AK HI LA FL AL GA WI MI PA OH WV NY CT NJ DE MD DC MA RI VT NH ME VA VA NC AZ NM SC 71+ percent (6 states) 62 to <71 percent (20 states including DC) 51 to 61 percent (10 states) 50 percent (15 states) SOURCE: Federal Register, February 2, 2010 (Vol. 75, No. 21), pp 5325­5328, at http://frwebgate6.access.gpo.gov/cgi­bin/PDFgate.cgi?WAISdocID=985592272797+0+2+0&WAISaction=retrieve . Total State Spending and Federal Funds Provided to States, 2004 Over twenty-two percent of state total spending and over forty-four percent of federal funds provided to states were spent on Medicaid. Total State Spending Elementary & Secondary Education 21.4% Higher Education 10.9% Public Assistance 2.1% Federal Funds Provided to States Elementary & Secondary Education 11.4% Transportation 8.0% Corrections 0.6% Higher Public Education Assistance 5.6% 3.6% Transportation 8.0% Medicaid 22.3% Corrections 3.5% All Other 26.3% Medicaid 44.5% All Other 31.7% Stimulus plan included $80 billion for state Medicaid payments Source: National Association of State Budget Officers, 2004 State Expenditure Report. Medicaid eligibility Medicaid eligibility Categorically eligible: Pregnant women and children under age 6 with family income below 133% of FPL ($29,725 for family of 4) Children ages 6 to 19 with family income under 100% FPL Caretakers (relatives or legal guardians who take care of children under age 18 (or 19 if still in high school)). Supplemental Security Income (SSI) recipients (or, in certain states, aged, blind, and disabled people who meet requirements that are more restrictive than those of the SSI program). Individuals and couples who are living in medical institutions and who have monthly income up to 300% of the SSI income standard (Federal benefit rate). Medicaid eligibility, contd. Medicaid eligibility, contd. Medicare Beneficiaries (Dual Eligibles) Qualified Working Disabled Individuals—Medicaid can pay Medicare Part A premiums for certain disabled individuals who lose Medicare coverage because of work. Medicaid pays Medicare premiums, deductibles and coinsurance for Qualified Medicare Beneficiaries (QMB) Individuals whose income is at or below 100% of the Federal poverty level and whose resources are at or below the standard allowed under SSI. Additional groups for whom some Medicare related expenses (Part B premiums) are paid by Medicaid include Medicare beneficiaries with income greater than 100% but less than 135% of the Federal poverty level. Medically Needy: States may raise income thresholds or expand eligibility The medically needy have too much money (and in some cases resources like savings) to be eligible as categorically needy. 37 states have medically needy programs Medicaid Eligibility for Working Parents by Income, December 2009 WA MT OR ID WY NV CA NE UT CO KS OK ND MN SD IA IL MO IN KY TN AR MS TX AK HI LA FL AL GA WI MI PA OH WV NY CT NJ DE MD DC MA RI VT NH ME VA NC AZ NM SC < 50% FPL (17 states) 50% ­ 99% FPL (17 states) 100% FPL or Greater (17 states, including DC) Note: The federal poverty line (FPL) for a family of three in 2009 was $18,310 per year. SOURCE: Based on a national survey conducted by Kaiser Commission on Medicaid and the Uninsured with the Center on Budget and Policy Priorities, 2009. Median Medicaid/CHIP Income Eligibility Thresholds, 2009 2 35% 185% $14,484 for single, $29,725 for family of 4 Medicaid Eligibility under Health Reform = 133%FPL 75% 64% 38% 0% Children Pregnant W omen Elderly and I ndividuals w it h Disabilit ies W orking Parent s Non­ W orking Parent s Childless Adult s Note: Medicaid income eligibility for most elderly and individuals with disabilities is based on the income threshold of Supplemental Security Income (SSI). SOURCE: Based on a national survey conducted by the Center on Budget and Policy Priorities for Kaiser Commission on Medicaid and the Uninsured, 2009. Medicaid Managed Care and Traditional Medicaid Managed Care and Traditional Enrollment, 1999­2008 Enrollment (in millions) 42.7 44.4 45.4 45.7 15.8 46.0 16.5 47.1 13.7 31.9 14.2 33.7 36.6 40.1 14.9 15.8 17.0 17.5 17.4 16.8 17.8 18.8 20.8 23.1 25.3 26.9 28.6 29.8 29.5 33.4 1999 2000 2001 2002 2003 2004 Number Enrolled in Traditional Medicaid Programs Number Enrolled in Medicaid Managed Care 2005 2006 2007 2008 Note: Numbers may not produce totals because of rounding. Unduplicated count. Includes managed care enrollees receiving comprehensive and limited benefits. SOURCE: 2008 Medicaid Managed Care Enrollment Report. CMS. Births Financed by Medicaid as a Percent of Total Births by State, 2005 Medicaid pays for about 41% of the nation’s births. WA MT OR ID WY IA NV UT CA CO NE IL KS MO IN OH WV KY TN OK AZ NM AR MS TX LA FL AK AL GA SC NC VA SD ND MN WI MI PA NJ NY RI CT DE MD DC MA VT NH ME AK Less than 32% HI 32.0% to 39.9% 40.0% to 47.9% 48% to 55.9% Source: Kaiser Family Foundation, State Health Facts, http://www.statehealthfacts.org Above 56.0% Childrens’ Health Insurance Childrens’ Health Insurance Program (CHIP) Began in 1997 to supplement Medicaid in providing coverage for lower­income children Higher income eligibility than Medicaid Cost roughly $50 billion over first 10 years. Renewed in 2008 for another 10 years (potential costs ~$80 billion) Percentage of Children Without Health Insurance, By Poverty Level, 1997-2005 Children below 200% of poverty 23% 21% 14% Children above 200% of poverty 6% 5% 5% 1997 1998 1999 2000 2001 2002 2003 2004 2005 Notes: Survey method change in 2005 affects comparison with earlier years slightly. Children less than 18 years old. Source: L. Ku, “Medicaid: Improving Health, Saving Lives,” Center on Budget and Policy Priorities analysis of National Health Interview Survey data, August 2005. Why are we concerned about the Why are we concerned about the rate of uninsured? Does the health of others enter into our own utility function? How does the rate of uninsured in our neighborhoods affect health delivery? Uncompensated care for hospitals Macro spillovers from poor health Raises overall health care costs? Expensive public programs Worker productivity Global competitiveness Scheduled Reforms for expanding Scheduled Reforms for expanding health insurance coverage Expansions of Medicaid Mandated individual insurance Cover up to 133% of Federal Poverty Line Fines of $750 ­ $1,500 or 2.5% of income Subsidize purchase up to 400% FPL and create cooperatives to offer plans outside of employer groups Eliminate denials of coverage for pre­existing conditions Requirements for larger employers to offer coverage and minimums for cost­sharing of premiums Require 1.5% – 12% of income for lowest cost plans Subsidies for smaller employers Potential Effects of Proposals Potential for severe adverse selection Could also have positive selection Changes to pre­existing conditions coverage What is health of currently uninsured and how much health care will they use when insured? Mandating coverage for healthy, younger people Would help to control premium growth Cost estimates influenced by response of each group (~ $1 trillion for first 10 years) Savings generated from cuts to Medicare payments and taxes on high­end health insurance plans What is provider response? ...
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This note was uploaded on 04/14/2011 for the course ECON 329 taught by Professor Classen during the Spring '11 term at Loyola Chicago.

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