Ohio Medicaid changes “Aged Blind Disabled” Eligibility

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.

Income for People with Special Needs

Everyone needs income to support themselves and their needs.  People with special needs may not be able to generate enough income through work or may not be able to work at all.  For someone who cannot work to support themselves (and who is not yet eligible for Social Security retirement benefits,) the source(s) of income might have certain restrictions.

Let’s start with the no-restrictions income.  If anyone (special needs or not) has enough invested money to generate enough income to support their needs and their lifestyle, no other sources of income are needed.  (Yes, this means rich people.)  These people do not need to worry (not at this time, anyway) about special needs law and protection of their income.  They’ve got investment risk but not a special needs law problem

People who aren’t quite so rich may need to draw down their invested assets to keep up with their necessary expenditures.  These people need to project whether how long their assets will last.  People like this (who need to use some of their assets to support themselves) may want to consult an attorney who practices in special needs to see if government program (or maybe charitable programs) can help their assets last.

People who have enough of a work history (during which they paid into the Social Security system) should be eligible for Social Security Disability Income (SSDI.)  These are people who may have suffered a debilitating accident or may have some sort of disease that affects people in middle age, such as MS or ALS.  (Remember, to get SSDI, you have to have significant work history and not yet have reached retirement age.)  Their SSDI does not have restrictions (except for people who become ineligible for SSDI by working despite their disability and, as a result, making more than a minimal income.)  SSDI payment may or may not be enough to support the disabled person’s needs.  If not, then the government and/or charitable benefits available to special needs people may become necessary.

People who do not have enough of a work history may need Supplemental Security Income (SSI.)  SSI is not available to people who have assets above $2,000.  That’s not much.  People who have assets over $2,000 can spend some of their assets or can put the “extra” money into an account that the SSI rules don’t count as the person’s assets.  A Special Needs Trust or an ABLE account (discussed in my blog post of February 5, 2015) might be appropriate, for example.  In addition, other sources of income or of housing support, could reduce the person’s SSI each month.

A special needs person must have either many valuable assets or an income stream (or some combination) to sustain themselves.  Advice from a special needs attorney can help sort out and get the maximum benefits of the person’s assets and income stream.