Benefit Bulletin: June 2014

Benefit Bulletin: June 2014

Will It Work? New Program Hopes To Lower Costs Of Caring For Low-Income Seniors

An experimental new program will affect the healthcare coverage of low-income seniors in 17 states over the next three years. Participating states are hoping that better coordination of healthcare, for the 9 million "dual-eligible" beneficiaries who receive both Medicaid and Medicare, will reduce costs for this very expensive group that currently totals $350 billion a year. Many dual-eligible seniors have multiple complex health problems, like Alzheimer's, diabetes, and heart conditions. In addition, some live in residential care facilities or need home-based support in addition to medical care.

The program could mean health plan changes are on the way for many Notch Babies, seniors born 1917 through 1926, who receive lower Social Security benefits than other seniors having similar earnings histories. Poverty rates increase with age and the longer seniors spend in retirement. According to the Social Security Administration, seniors in the oldest group – age 80 and older – like Notch Babies, have the highest poverty rates.

States participating in the program will move dual-eligibles into private managed care plans that have contracted to provide all healthcare benefits. Yet the changes are coming at the same time insurers are restricting their Medicare provider networks by ending contracts with doctors and major hospitals, due to cuts mandated by Obamacare legislation.

Some experts are raising concerns questioning how many low-income seniors will voluntarily enroll in the new program, and how health plans will ensure that there are enough doctors and other providers to take care of patients who have the most challenging and time-consuming health problems. TSCL shares these concerns. The program model requires doctors to work closely with both clinical and nonclinical staff to manage both medical care and social services for beneficiaries. TSCL is concerned that doctors may not find it feasible to spend the required time on care.

TSCL believes that questions remain as to how the Centers of Medicare and Medicaid Services will ensure that enrollees won't experience delays or denials in receiving covered medical services and prescription drugs. Managed care organizations admit that they are concerned that spending limits that Medicare will impose during the three-year pilot program could make it difficult to improve care for this group. Despite the issues, states are moving forward.

We urge low-income seniors who receive both Medicare and Medicaid, and their caregivers, to watch the mail and carefully read all notices of changes from state Medicaid departments and Medicare. If you learn your health coverage may be changing, call the number listed to ask questions. Be sure to learn if your doctors and hospitals participate in the new plan (if that is important). Seniors affected will have the opportunity to "opt out," but, to do so, you must let your state Medicaid office know of your decision.


Sources: "States Meld Medicare And Medicaid," Christine Vestal, USA TODAY, February 12, 2014. "State Plans For Dual-Eligibles Face Tough Challenges," Virgil Dickson, Modern Healthcare, March 29, 2014.