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Issue Alert - 03-09-03

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Date:

Sep 23, 2003

Issue Summary:

New Adult Medical Program will mean new co-payments for prescriptions, office visits, and some emergency room visits for SMP and county health plan recipients, but provides some inpatient hospital coverage

Persons Affected:

State Medical Program and County Health Plan recipients


Background

Health benefits-- State Medical Program (SMP) and County Health Plans, soon to be known as Adult Medical Program (AMP)

What's Happening?

Effective October 1, 2003, the SMP and County health plan programs will be converted to the Adult Medical Program (AMP). WHAT WON'T CHANGE:FIA will continue to determine eligibility and in counties that have County health plans, the county-based entities will continue to administer healthcare coverage for those eligible in their counties, through managed care plans. In counties without County health plans, the Department of Community Health (DCH) will continue to pay on a "fee for service" for covered health care received by AMP recipients.In determining income eligibility, FIA will continue to disregard the first $200 and then 20% of the remainder of an individual's earnings. Eligibility will continue to be available only prospectively, for the month of application forward. WHAT WILL CHANGE: 1. The income limit will be 35% of the federal poverty level or $262 per month -- slightly less than the current SMP limit of $264 per month. It appears that recipients with income of $263 or $264 per month will lose eligibility under the new guidelines when their eligibility is redetermined -- at least until the federal poverty level is adjusted for inflation in February 2004.2. Individuals will not be allowed to qualify by meeting a spenddown. Although this is a small group, you may see clients who have been able to meet their SMP spenddown and obtain coverage in the past under the SMP program. Because the SMP spenddown is based on a protected income level of only $264 per month and because the spenddown was calculated for a 6 month period, most clients who had spenddowns were not able to meet them. 3. Eligible individuals will have to pay co-payments for some services that used to be available at no cost. The co-payments are: $3.00 per office visit AND $5.00 or $10.00 (for drugs not on the formulary) per prescription AND$25.00 for emergency room visits that don't result in an overnight admission to the hospitalCounty health plans may choose not to require co-payments. At least some county plans have chosen not to apply the co-payments or to exempt certain types of prescriptions from co-payment. 4. Recipients will not have to get a "slip" from the caseworker each time they need a service. Recipients will receive a green plastic "mihealth" card -- the same card as Medicaid recipients. The card will be coded to inform providers that the individual does not have full Medicaid coverage. Providers who serve AMP recipients will be paid at the Medicaid rate (higher than the SMP rate) for services covered by AMP. In counties with County Health Plans, the recipient will also receive a health plan/HMO card and will have to show both cards to the provider. 5. Recipients will be eligible for "case rate" coverage for inpatient hospitalizations. AMP will pay $900 per admission for inpatient hospitalizations. It is not clear whether hospitals will accept individuals for admission with this source of payment in non-emergency situations, because the $900 payment will not cover the hospital's costs of admission.SOME INITIAL ISSUES (look for follow-up alerts on these issues):1. Will providers be required to provide services to recipients who cannot pay the co-payments? Proposed policies issued by the state indicated that AMP recipients would have the same protections as Medicaid recipients if they were unable to pay their copayments. Under federal Medicaid laws, recipients cannot be denied a service because of inability to pay the co-payment. 42 USC 1396o(f) & 42 CFR 447.53(e). However, the notices that were sent to SMP and County Health Plan recipients telling them about the new, AMP co-payments did not explain this protection and did not tell recipients that it is up to them to tell providers they are unable to pay the co-payment in order to be protected. It is unclear at this time whether the state intends to protect AMP recipients who cannot pay the co-payments and to provide notice of the protection. 2. Will AMP recipients who later establish eligibility for Medicaid be entitled to full retroactive Medicaid coverage? Under federal Medicaid law, 42 USC 1396a(a)(34), individuals who establish eligibility are entitled to receive Medicaid for up to 3 calendar months prior to the month in which they apply for Medicaid. The FIA policy seems to suggest that a recipient will not be approved for Medicaid coverage retroactively for months prior to the date that Medicaid is approved. PEM 640 page 5. Retroactive coverage may be important for individuals who have received services that are not covered by AMP but are covered under Medicaid (such as physical therapy, many types of diagnostic testing, etc.). It is not clear at this time whether the state actually intends to eliminate retroactive Medicaid coverage for AMP recipients who later are determined eligible for Medicaid. 3. Will the co-payments be cost effective? The state is imposing co-payments in order to save money. However, recipients who are unable to access prescriptions and office visits because of the co-payments, or who fail to seek timely emergency roon treatment, are likely to need more expensive, hospital based care. Even with the $25 emergency room co-payment and the $900 flat fee for inpatient hospitalizations, the state will end up spending more rather than less money because of the co-payments if the co-payments prevent recipients from getting the routine services they need to stay healthy. It will be important to document problems caused by the co-payments. 4. Will federal approval be received prior to October 1, 2003? As of September 23, the waiver had not been approved by the federal agency (CMS - the Center for Medicare and Medicaid Services), although FIA and the Department of Community Health are moving forward with plans to implement the changes effective October 1, 2003.

What Should Advocates Do?

If you live in a county with a county health plan, find out if your county will be imposing co-payments. Share that information with clients.Be sure current recipients are aware of the changes. They may want to get prescription refills in September if possible, before the co-payments are imposed.Look for further updates on co-payments so that you can provide accurate information to clients about whether they have a right to services if they are unable to pay co-payments. Document any problems that clients experience because of co-payments and share those stories with the Center for Civil Justice.

What Should Clients Do?

Avoid using the emergency room if at all possible. Get prescriptions refilled in September 2003 if possible.Let providers know if you are unable to pay co-payments. Seek legal advice if you are denied services because you are unable to pay a co-payment. Look for providers (doctors and pharmacies) that are willing to waive the co-payments.

Finding Help

Most legal aid and legal services office handle these type of cases, and they do not charge a fee. You can locate the "free" legal services or legal aid office that serves your county on the Michigan LawHelp website (www.MI.LawHelp.org) or look in the yellow pages under "attorneys" or call the toll-free lawyer referral number, (800) 968-0738.