You asked for a description of legislative changes in the SAGA program during the last several years. You also asked whether caseloads have changed as a result of these changes.

We provided a history of SAGA cash assistance changes in OLR Report 2004-R-0559, attached. This report will focus on changes since July 2003.

SUMMARY

The legislature has made significant changes in the SAGA program over the last several years. In 2001 and 2002, it eliminated certain services under the medical assistance portion of the program.

As part of his FY 2003-05 budget submission to the legislature, Governor Rowland recommended eliminating the program in its entirety. The legislature instead chose to keep the program but made major changes. Most significantly, it (1) cut the cash benefits that program beneficiaries could receive and (2) changed medical assistance from a fee-for-service system (where a client could go to any doctor who accepted Department of Social Service (DSS) payment for services and DSS paid the provider directly based on a fee schedule) to a health center model to which clients can only go to a medical home using the state’s existing network of federally qualified health centers (FQHCs) and other primary care providers who contract with DSS.

SAGA cash assistance caseloads have continued to decline since the legislature cut benefits in 2003. There were 4,473 SAGA cash assistance recipients in November 2004, down from 4,621 a year earlier. (Peak cash assistance monthly enrollment since 1989 topped 35,000 individuals during FY 93). It can be argued that the pre-2003 decline in cash assistance enrollment was a direct result of changes in the program’s eligibility criteria. It is less clear what has caused the more recent enrollment declines.

According to DSS, 29,784 people were enrolled in SAGA medical assistance in January 2005. Historical data (see Attachment 1) show a dramatic increase (over 100%) in program enrollment since the state took over the program’s administration in 1998, with a slight increase since the 2003 legislation restructured the program.

PA 01-2, JSS AND PA 02-7, MAY SPECIAL SESSION—CUTS IN MEDICAL SERVICES

The legislature reduced the benefit package for SAGA and GA (Norwich only) medical assistance recipients starting in 2001. PA 01-2, June Special Session, eliminated coverage for non-emergency medical transportation, effective July 1, 2001. (DSS subsequently restored this service for cancer and dialysis patients, but the law was never changed to reflect the policy change. ) PA 02-7, May 9 Special Session, eliminated coverage for eye care, optical hardware, and optometry care; podiatry; chiropractic; naturopathy; and home health care.

PA 03-3, JUNE 30 SPECIAL SESSION AND PA 04-258—CASH CUTS AND MEDICAL RESTRUCTURING

Reduction in Cash Benefits

In August 2003, the legislature made significant changes in both the cash and medical components of the SAGA program. It reduced monthly cash payments, which had to start between September 1, 2003 and October 1, 2003, as follows:

Families who had not yet qualified for the Temporary Family Assistance (TFA) program also had their benefits cut. But the act made it easier for these families to qualify for TFA, thus the impact of this reduction was expected to be minimal.

Medical Assistance

Until PA 03-3, June 30 SS passed, SAGA recipients (and GA recipients living in Norwich) received their health care on a fee-for-service basis, generally in the same way as Medicaid recipients who were not enrolled in managed care plans. The act restructured SAGA medical assistance, assigning responsibility to serve these clients to the state’s federally qualified health centers (FQHCs) or other primary care providers.

DSS contracts with Community Health Network (CHN) to administer the program. CHN, a consortium of FQHCs, enrolls clients and helps them find providers in their area. (For more information on the CHN contract, see OLR Report 2004-R-0742. )

Co-Payments. PA 03-2 required SAGA and GA recipients to pay a $ 1 co-payment for all outpatient medical services and prescription drugs. PA 03-3, June 30 SS, eliminated the co-payment for medical services but increased the prescription co-payment to $ 1. 50. PA 04-258 repealed the prescription co-payment.

Look-Back For Asset Transfers. PA 04-258 also instituted a three-month look-back period for SAGA medical assistance applicants. This meant that the state would presume that an applicant who transferred, assigned, or otherwise disposed of property for less than fair market value during the months before applying for SAGA medical assistance did so to become eligible for assistance and would hence lose eligibility for a period of time based on the uncompensated value of the transferred asset.

Appeals for Service Denials. PA 04-258 permits SAGA medical assistance recipients to seek a DSS review of a denial of coverage for specific medical services only after they exhaust the available grievance process that might be available to them. PA 04-2, May Special Session, makes it clear that the contractor’s (CHN) appeals process must be exhausted before DSS will hear a coverage denial appeal.

No Reimbursement to Norwich

Norwich was the only town that continued administering its own GA program once the state took over the program (see OLR Report 2004-R-0559). The town would provide benefits and the state would reimburse it for its costs. PA 03-3, June 30 SS, eliminated the state reimbursement for any medical expenses incurred after September 30, 2003 and any cash benefits or administrative costs incurred after February 29, 2004.

CASELOADS—BEFORE AND AFTER LEGISLATIVE CHANGES

In OLR Report 2004-R-0559, we stated that GA cash assistance caseloads dropped dramatically between May 1990 and May 2003 and concluded that the legislative changes during that time could well have contributed to the enrollment declines.

Since we wrote that report, caseloads have declined further, despite the fact that eligibility rules for cash assistance have remained the same.

Table 1 shows how the SAGA/GA cash caseload changed between July 1, 2003 and November 1, 2004 (the latest date for which we have caseloads available). The caseload dropped by 14% during this period. Since 1990, the caseload has fallen 77%.

Table 1: SAGA/GA Caseload—July 2003—November 2004

Attachment 1

Source: Department of Social Services (February 2005)

RC: dw/ts