1.1: Health Insurance and Long-Term Care Coverage

Broaden health insurance and long-term care coverage.

Other Information:

HHS is committed to broadening health insurance and long-term care coverage. The multifaceted approach to expanding consumer choices includes strengthening and expanding the safety net through programs such as Medicare, Medicaid, and the State Children’s Health Insurance Program (SCHIP); creating new, affordable health insurance options; and creating new options for long-term care, including State Long- Term Care Partnership Programs. The operating and staff divisions contributing to the achievement of this objective include CMS, SAMHSA, AoA, HRSA, and OD. The growing availability of prescription drugs and their cost have had a significant impact on health insurance. The first selected performance indicator, at the end of this chapter, measures the percentage of Medicare beneficiaries who have insurance coverage for prescription drugs through the Medicare drug benefit (Part D) or other coverage. This enrollment is expected to increase. Also, health care coverage for millions of present and future Medicare participants is protected by ensuring that the level of improper payments in the Medicare Fee-For-Service program remains low. Health Insurance - Medicare: Medicare is a health insurance program for people age 65 years or older, people younger than age 65 with serious disabilities, and most people of all ages with end stage renal disease (permanent kidney failure requiring dialysis or a kidney transplant). Three major categories of Medicare include: Part A, which covers inpatient hospital care, skilled nursing facilities, certain home health care, and hospice care; Part B, which encompasses physicians’ services, outpatient hospital care, and many other medical services; and Part D, the newest component of Medicare, which offers a voluntary prescription drug benefit to beneficiaries. There is also a Part C for Medicare, known as Medicare Advantage, that allows beneficiaries to choose a private health insurance plan that covers the Part A and Part B services and, in most circumstances, additional benefits and/or lower cost-sharing payments than under the traditional Medicare FFS program. Medicare Part D. Part D is celebrated as the most significant improvement to the program since Medicare was created in 1965. More than 39 million Medicare beneficiaries now have prescription drug coverage through Part D or another source, including almost 24 million beneficiaries in Part D plans.vi CMS continues to improve program administration of the Medicare prescription drug benefit and to expand awareness of the program through relationships with States and pharmacists, increased use of electronic technology, and education and outreach efforts with more than sixteen thousand partners. CMS will continue these efforts to ensure that beneficiaries can get the prescriptions they need. In particular, CMS has collaborated with AoA and its grassroots Aging Services Network, consisting of State agencies on aging, area agencies on aging, and local service providers, to provide one-on-one assistance and outreach directly to beneficiaries and their caregivers. A number of other initiatives to broaden access are currently underway or in development, such as the “My Health. My Medicare.” campaign and Medicare Medical Savings Accounts. The “My Health. My Medicare.” campaign helps people with Medicare maximize their understanding of the benefits Medicare offers. CMS promotes beneficiary awareness through mailings, media activities, a strong Internet presence, a 24-hour-a-day toll-free telephone service, grassroots alliances, and enhanced beneficiary counseling with State Health Insurance Assistance Programs. CMS partners in this effort include the National Medicare Education Program Partnership Alliance, AoA and its Aging Services Network, State and local agencies, grassroots organizations, the AARP, Medicare Today, the National Caucus and Center on Black Aged, national disability provider and constituent organizations, and other stakeholders. CMS continues to build committed partnerships at the community level; these partnerships will ensure the agency can successfully build on the “My Health. My Medicare.” campaign, as well as other health-related initiatives, in future years. These partnerships are having a profound impact on helping CMS reach the Medicare population, especially the program’s most vulnerable beneficiaries. For example, in collaboration with AoA, in addition to working with the general Medicare population, special efforts are being made to target minority populations to reduce health disparities in the Hispanic, Asian, and African-American communities, as well as in rural communities. Medicare Medical Savings Accounts. CMS is implementing an enhanced consumer-directed Medicare Advantage product called a Medicare Medical Savings Account (MSA) plan. This type of plan combines a high-deductible health plan with a medical savings account that beneficiaries can use to manage their health care costs. CMS will offer regular MSA plans and new demonstration MSA plans. These plans will provide Medicare beneficiaries with the freedom to exercise increased control over their health care utilization while providing them with important coverage against catastrophic health care costs. CMS is providing increased flexibility with the demonstration MSA plans to make the MSAs more like the popular consumer-directed Health Savings Accounts (HSAs) available in the private sector. Examples of the types of flexibility being made available under the demonstration that are not available under the regular MSA rules include coverage of preventive services during the deductible period, a deductible below an out-of-pocket maximum, cost sharing up to the out-of pocket maximum, and cost differentials between in and out-of-network services. Medicaid: Medicaid is a joint Federal- and State-funded, State administered health insurance program available to certain low-income individuals and families who fit into an eligibility group that is recognized by Federal and State law. Using a variety of State plan options and waivers, each State establishes its own rules and guidelines regarding eligibility and service offerings, subject to approval by CMS. CMS also offers flexible State plan options and community-living incentives. In support of these options and incentives, CMS and AoA will continue to target home- and community-based long-term care services to frail older adults who are at high risk of nursing home placement or at risk of spending down their assets. SAMHSA and CMS also will continue to collaborate on issues regarding Medicaid coverage for substance abuse and mental health services. Children’s Health Insurance: The State Children’s Health Insurance Program (SCHIP), a State-administered program, addresses the growing problem of children without health insurance. SCHIP was designed as a Federal-State partnership, similar to Medicaid, with the goal of expanding health insurance to children whose families earn too much money to be eligible for Medicaid, but not enough money to purchase private insurance. CMS will work with the U.S. Congress to reauthorize SCHIP to ensure that these vital programs continue. Affordable Choices: HHS has begun to work with other Federal departments and with States to increase access to private health insurance for those who do not yet have it through the Affordable Choices initiative and related efforts. This proposal would redirect inefficient institutional subsidies to individuals and would need to be State based and budget neutral, not create a new entitlement, and not affect savings contained in the President’s Budget that are necessary to address the unsustainable growth of Federal entitlement programs. Outreach To Raise Awareness: Health Insurance Enrollment and Long-Term Care Coverage Outreach is a collaboration of CMS, AoA, ACF, HRSA, State and local health departments, State Medicaid and SCHIP agencies, State and area agencies on aging, child care and early education providers, and State departments of agriculture and education. This collaborative effort conducts outreach to raise awareness of public health insurance and long-term care benefits and provides information and access assistance. Demonstrations and Waivers: States have many options, including Federal waivers, for broadening coverage to underserved populations. Using Health Insurance Flexibility and Accountability waivers, States can develop comprehensive insurance coverage for individuals at twice the Federal Poverty Level (FPL) and below, using SCHIP and Medicaid funds. These waiver programs target vulnerable, uninsured populations, such as children on Medicaid and SCHIP, and pregnant women. Emphasis is placed on broad statewide approaches that maximize both private health insurance coverage and employer sponsored insurance. Indian Health Programs: IHS provides a comprehensive health services delivery system for American Indians and Alaska Natives with opportunity for maximum tribal involvement in developing and managing programs to meet their health needs. The mission of IHS, in partnership with American Indian and Alaska Native (AI/AN) people, is to raise their physical, mental, social, and spiritual health to the highest level. The goal of IHS is to ensure that comprehensive, culturally acceptable personal and public health services are available and accessible to all American Indians and Alaska Natives. IHS promotes healthy AI/AN people, communities, and cultures and honors the inherent sovereign rights of tribes as part of the Federal Government’s special relationship through treaty obligations with tribes. In 2005, IHS provided health services to approximately 1.5 million American Indians and Alaska Natives who belong to more than 557 federally recognized tribes in 35 States.vii Both primary care physicians and nurse practitioners provide primary care.viii Those children or adults in fair or poor health with only IHS coverage probably did not see a physician in the past year. Adults in good or excellent health with only IHS coverage were probably less likely to have seen a physician in the past 2 years, compared to similar adults with Medicaid or private insurance.ix IHS access alone does not constitute health insurance coverage. Those not served by IHS may use private or State insurance out of preference or lack of proximity to IHS or tribal facilities. Limitation of contracted health service funds and insurance reduces the use of specialty care physician services for American Indians and Alaska Natives. In response to these and other emerging challenges, IHS is focused on expanding access for American Indians and Alaska Natives to comprehensive primary health care services. In addition, IHS recognizes the importance of retinopathy screening for those with diabetes and colorectal screening for early cancer detection and prevention. CMS has joined in efforts to expand access for American Indians and Alaska Natives to health care services covered by Medicare, Medicaid, and SCHIP. The Indian Health Care Improvement Act of 1976 (Public Law 94-437), as amended, extended the Federal obligation to CMS by authorizing payment for Medicare and Medicaid services provided through IHS facilities. This responsibility includes services provided by tribal governments administering health programs under authorities through the Indian Self-Determination and Education Assistance Act of 1975 (Public Law 93-638), as amended. The Indian Health Care Improvement Act further expanded this responsibility by authorizing 100 percent Federal Medical Assistance Percentage to States for payments to IHS and tribal facilities for Medicaid services. CMS works with IHS and the tribes to ensure they follow the Payor of Last Resort rule. According to this rule, IHS pays after Medicare or Medicaid has paid for eligible services, whether IHS and tribes provide services directly or a private source provides them under referred services. Long-Term Care: Long-term care can be required by individuals with disabilities needing assistance with activities of daily living, individuals with frailty and/or dementia associated with aging, individuals with advanced chronic conditions, and other individuals at or near the end of life. The central vision for an efficient long term care system is one that is person centered, i.e., organized around the needs of the individual rather than around the settings where care is delivered. The evolving long-term care system of the future will provide coordinated, high-quality care; optimize choice and independence; be served by an adequate workforce; be transparent, encouraging personal responsibility; be financially sustainable; and utilize health information technology to improve access and quality of care. In an effort to facilitate this system transformation, CMS, in partnership with the U.S. Congress, provides funding to States, territories, and tribal entities to expand choices to persons who need long-term care services. Real Choice Systems Change grants, Medicaid Infrastructure grants, and Systems Transformation grants are a few examples of HHS efforts to assist States in building the needed infrastructure for expanding choices. HHS also works closely with States, territories, and tribal entities to achieve more flexibility in the Medicaid program. To that end, the Money Follows the Person Rebalancing Demonstration project builds on the President’s New Freedom initiative. The Money Follows the Person Rebalancing Demonstration project will help States further address the institutional bias in coverage inherent in the Medicaid program. Selected States will be awarded additional Federal funds to pay for home and community-based services for the first year that individuals transition from institutional care to a community-based setting of their choice. The Long-Term Care Insurance Partnership Program is a federally supported, State-operated initiative that allows individuals who purchase a qualified long-term care insurance policy to protect a portion of their assets that they would typically need to spend down prior to qualifying for Medicaid coverage. Once individuals purchase a long-term care insurance partnership policy and use some or all of their policy benefits, the amount of the policy benefits used will be disregarded for purposes of calculating eligibility for Medicaid. This stipulation means that they are able to keep their assets up to the amount of the policy benefits they purchased and used. For example, in a State that chooses to participate in the partnership program, once individuals have used part or all of their maximum lifetime benefit under their long-term care insurance coverage, their assets would be protected up to the amount used, up to that maximum lifetime benefit. Individuals would not need to spend those assets before qualifying for that State’s Medicaid program. The Aging and Disability Resource Center grant program, a cooperative effort between CMS and AoA, assists States with their efforts to streamline access to long-term care. Program funding supports the development of “one-stop shop” programs to serve as a single, coordinated system of information, assistance, and access. Persons seeking knowledge about long-term care will receive information that will minimize confusion, enhance individual choice, and support informed decision making. Persons seeking knowledge about public and private long-term care options will receive information that will minimize confusion, enhance individual choice, and support informed decision making. Building on this effort, AoA’s Choices for Independence demonstration project aims to provide seniors and their caregivers with information, assistance, and counseling to confront the difficult decisions they face regarding long-term independence in the community, by seeking to reduce the current systemic bias in favor of institutional care. Choices for Independence will target people while they are still healthy and able to plan for their care and will encourage them to take positive steps to maintain their own health. If people need care, Choices for Independence will help them to bolster their own support system and resources before they enter a nursing home and spend down to Medicaid. CMS is working with ASPE and AoA on the HHS Own Your Future campaign, in partnership with six States (Georgia, Massachusetts, Michigan, Nebraska, South Dakota, and Texas). Own Your Future is an aggressive education and outreach effort designed to increase consumer awareness about planning for long-term care. The campaign uses Federal-State partnerships to help individuals from ages 45 to 65 take an active role in planning by evaluating their future long-term needs and resources. Own Your Future provides objective information and resources to help individuals and their families plan for future long-term care needs. To enhance this effort, AoA, ASPE, and CMS have launched the National Clearinghouse for Long-Term Care Information Web site to increase public awareness about the risks and costs of long-term care and the potential need for services. CMS is working with the U.S. Department of Housing and Urban Development to explore options for the provision of long-term care services for beneficiaries living in affordable housing. ASPE and AoA are also collaborating on strategies to develop reverse mortgage programs that will encourage homeowners to use existing assets to acquire long-term care services in the community. CMS is also collaborating with AoA, ASPE, the Administration on Developmental Disabilities (ADD) in HHS’s Administration for Children and Families (ACF), OD, and Federal agencies such as the U.S. Departments of Education and Labor to address long-term care workforce issues.

Indicator(s):

Indicator:1

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