A change in how eligibility for Medicaid is determined could save Indiana $26 million this fiscal year by pushing thousands of residents off coverage but providing first-time benefits to even more at lower costs.
Indiana has abandoned its own eligibility determination process for receiving Medicaid disability benefits, which required people applying for federal disability to duplicate the work to receive state assistance. It has replaced it with one in which anyone found eligible for federal supplemental security income is automatically eligible for Medicaid in that state.
State officials are heralding the change and the savings it is bringing because those added to the program have lower health costs than those removed. But advocates say the process that took effect June 1 has had problems.
"There are issues falling through the cracks because of the complexities," Dennis Frick of Indiana Legal Services told The Journal Gazette.
About 1.1 million Hoosiers receive Medicaid, the joint federal-state health insurance program for low-income people and those with disabilities. Of that number, 194,000 are considered disabled.
Before the conversion, 18,000 Hoosiers were eligible for supplemental security income but were not receiving Medicaid. They now receive health coverage through Medicaid, according to the state Family and Social Services Administration.
Joe Moser, state Medicaid director, said the change eliminates a second layer of bureaucracy for people and for the state.
But he acknowledged that it means Hoosiers have to go through Social Security for disability, which is known as a cumbersome process that can take months and often ends in appeals.
About 68,400 Hoosiers right now are on Medicaid disability but do not have supplemental security income.
To maintain eligibility, most will need a federal disability determination.
More than 13,000 Hoosiers lost coverage June 1. Many of those are now eligible for tax subsidies to buy individual health insurance on the federal marketplace.
Others were removed because the change eliminated the so-called spend-down program for older disabled Hoosiers who are medically eligible but earn more than the income limit. The program requires recipients to pay part of their medical bills every month before Medicaid kicks in.
Nancy Griffin, who works for the Center for At-Risk Elders in Indianapolis, said she is concerned about people who are currently on Medicaid disability but now have to go through the Social Security process by next year to continue receiving coverage.
"It's a very complicated process, and sometimes it takes three appeals because it's so paperwork-heavy," she said.
An FSSA spokesman said that if an individual is receiving Medicaid for the disabled and is determined not disabled by the Social Security Administration, the individual has 60 days to appeal. Coverage must be maintained during the appeal.