Medicaid Spend-Down Option
a Health Insurance
By Girard A. Plante
The economic downturn over the past four years has
decimated the finances of millions of Americans. Foreclosures are at all-time
highs, pensions have been wiped out, and health insurance benefits have been
For people suddenly stricken by illness, disease or
serious injury, the specter of exorbitant medical costs is all-consuming.
Despite that nightmare scenario, there is a program that can pay for
bank-busting medical bills: Medicaid.
A provision called a spend down can be a
viable option for people eligible for the publicly funded health insurance
program. It allows people to receive medical care without going
bankrupt, said Elaine Saly, a health policy analyst with Families USA, a
Washington, D.C.-based advocacy organization that works with states on Medicare
For people who qualify, the spend-down provision could be
a lifesaver. It functions like a deductible in two ways," Saly said. "You
can use a medical bill that equals the amount a state sets for the spend down
-- or you pay out of pocket.
States can set different levels for the amount one pays
toward a spend-down amount before Medicaid pays medical expenses, Saly said.
It's a temporary program to address very high medical costs and allows
people with pre-existing conditions to get coverage.
In certain states, there are various Medicaid options for
Social Security recipients. In Massachusetts, recipients can collect up to a
threshold of $1,232 monthly before their MassHealth coverage is affected. Any
amount over the threshold renders recipients ineligible for Medicaid. But
Massachusetts' spend-down provision allows recipients to retain their
Another alternative to paying a costly spend down in
Massachusetts is CommonHealth, which covers persons with disabilities. If they
work 10 hours a week, they pay a minimal monthly premium that doesn't cause
This past October, the Social Security Administration
announced a 3.4 percent increase in Social Security payments for its 70 million
recipients. The small hike will be a welcome boost to some, but others caught
in the situation of having too much income face the specter of losing critical
People with physical disabilities who require personal
care attendant services to live independently may have few alternatives. But
that is not the case in Massachusetts, said Merit Young, a benefits counselor
with the state's rehabilitation commission.
A person living with a disability, especially
individuals who rely on PCAs, can meet special conditions. In the 12 years I've
been working with people who require PCA services, I never saw one person lose
(his) MassHealth benefits.
Knowing one's rights and being a savvy self-advocate can
keep consumers from losing out on the array of services available in times of
crisis. The first step to avoiding a spend down is not to panic; the next is to
go to a legal aid agency or a nearby center for independent living, both of
which can instruct people about their rights and help in securing benefits.
Moreover, with baby boomers retiring by the thousands
daily, long-term-care insurance is a huge issue. Though there are myriad
policies to choose from, most are expensive and may not cover care if consumers
outlast the life of the policy.
So, is Medicaid the best option? The Kaiser Family
Foundation published data in collaboration with a January 23 rd Washington
Post article, which state that Medicaid "is the largest source of coverage
for long-term care. But Medicaid comes with significant limitations. The
program is restricted to people with extremely limited income and virtually no
resources, which forces middle-income consumers to spend down their assets if
they want to qualify.
Still, Saly believes that Medicaid's spend down is a
realistic choice when there are no other options to getting health insurance.
We improve the (Medicaid) programs, she said.
For more information on Medicaid's spend-down provision,
go to www.familiesusa.com .
Girard A. Plante is a journalist and disability rights
advocate who has written on disability rights issues for 23 years. He lives in