Ohio Medicaid will change its rules on who can participate in the Medicaid Aged, Blind, and Disabled (“ABD”) program. The change will take effect in July 2016 for new applicants and will take effect with the annual renewals for existing Medicaid enrollees starting in January 2017. (The dates are subject to federal approval.) Ohio’s aim is to spend less on Medicaid. (It is a HUGE part of the state budget.)
Under federal Medicaid law, states can choose from two different ABD eligibility systems (meaning that the states can choose from two different SPENDING systems for their ABD programs.) The Ohio Department of Medicaid and the Ohio Department of Health Transformation, with a supporting change in the law by the state legislature, will change Ohio’s ABD Medicaid program from following section 209(b) of the federal Medicaid law to following section 1634 of the federal Medicaid law. Under the 209(b) system (the one that Ohio is leaving,) the states can make certain of their own choices on who is eligible for ABD coverage. Under the 1634 system (the one into which Ohio is moving,) the states must follow federal guidelines on eligibility.
The biggest differences between most states’ (including Ohio’s) 209(b) eligibility rules and the federal rules were in financial eligibility. States that followed 209(b) could have limits on income and assets that were tighter than the federal standards. That gave the appearance of keeping more people off of Medicaid ABD coverage than federal rules would have allowed.
Ohio’s rules under its 209(b) sy(tem (the old system) allowed people who had medical expenses to reduce their countable income by the amount of those medical expenses. This is called a “monthly spend down.” That spend down measurement allowed some people who had too much income “back” into Medicaid coverage. (A future installment will discuss the spend down in more detail.) The new system (under section 1634) will not allow spend downs to reduce countable income.
People with too much income won’t be left without coverage. People who have too much income to qualify for Ohio’s ABD Medicaid will be eligible for private insurance under the Affordable Care Act. Most anyone who would have qualified for ABD coverage through a spend down under Ohio’s old system will probably qualify for a highly subsidized, cost-controlled insurance policy through HealthCare.gov.
Many states followed 209(b) before the Affordable Care Act and its subsidy and cost control requirements made commercial policies affordable to more people. Many of those states have made the switch to 1634 since the Affordable Care Act has been implemented. Ohio is now following that trend.
In the installments ahead, we will discuss some of the details of this switch.