OLR Bill Analysis

sHB 5796

AN ACT CONCERNING ELIGIBILITY FOR THE FEDERAL SPECIFIED LOW-INCOME MEDICARE BENEFICIARY PROGRAM, THE QUALIFIED MEDICARE BENEFICIARY PROGRAM AND THE QUALIFYING INDIVIDUAL PROGRAM.

SUMMARY:

Beginning July 1, 2008, this bill requires the Department of Social Services (DSS) to increase the amount of income it disregards when determining an individual's eligibility for the Medicare Savings Program (MSP). The disregard amount must effectively move the person's income level up to the level that applies in the Connecticut Pharmaceutical Assistance Contract to the Elderly and Disabled (ConnPACE) program. By equalizing the income levels, the bill enables more people to qualify for the MSP which, consequently, automatically makes them eligible for Medicare Part D low-income subsidies.

The current ConnPACE income limits are $ 23,700 and $ 31,900 for single and married participants, respectively. The MSP consists of three tiers of benefits, each with its own income eligibility criteria, and the most generous benefit going to individuals with the lowest incomes. It is unclear whether federal law permits the state to have a single income limit for all three tiers, which the bill appears to require.

The bill also permits the DSS commissioner to act as the authorized representative of a ConnPACE applicant or recipient for purposes of facilitating that person's enrollment in an MSP, when he or she elects to be in that program.

EFFECTIVE DATE: July 1, 2008

BACKGROUND

Medicare Savings Program ( MSP)

The federal MSP consists of three separate programs: the Qualified Medicare Beneficiary (QMB), the Specified Low-Income Beneficiary (SLMB), and the Qualified Individual (QI). People qualifying for these programs get help (from the state's Medicaid program) with their Medicare cost sharing, including premiums and deductibles, if they are enrolled in Medicare Part A. Table 1 lists each program, its federally prescribed financial eligibility criteria, and the coverage in Connecticut.

Table 1: Medicare Savings Programs

*States have a limited amount of money from which they pay on a first-come, first-served basis.

Currently, when determining income eligibility for any of the MSP programs, DSS disregards the first $ 241 of unearned income (indexed annually). (Disregards are also taken for earned income. ) In addition, DSS disregards the Social Security cost-of-living adjustment for January through March. (This is to comply with a federal requirement since the federal poverty levels are not adjusted until April 1. It ensures that people whose income is at the limit do not lose their eligibility solely due to the COLA. )

Federal law allows states to recover benefits paid from the estates of QMB recipients and Connecticut does this. States that do estate recovery may not require individuals who may be eligible for the QMB program to apply for it.

ConnPACE Eligibility

For Medicare-eligible individuals, the ConnPACE program essentially provides “wrap-around” coverage for individuals with Medicare Part D plans (e. g. , cost sharing). To qualify for ConnPACE in 2008, income is limited to $ 23,700 for single individuals and $ 31,900 for married couples. When calculating an applicant's available income, DSS deducts any Part B premiums paid ($ 96. 40 per month in 2008). There is no asset test in the ConnPACE program.

Medicare Part D Low-Income Subsidy

People who have low incomes are eligible for help paying their Part D premiums, co-payments, and costs during the coverage gap (“donut hole”).

ConnPACE helps these residents if they meet that program's income limits by paying the donut hole coverage, Part D premiums, and limiting the co-payment amount to no more than $ 16. 25 per prescription (unless the Part D plan's co-payment is less).

People who qualify for the MSP programs are automatically eligible for federal help with coinsurance, or Low-Income Subsidies (LIS). These individuals pay no Part D plan premiums or deductibles, and pay $ 1. 05 or $ 2. 25 for generic drugs and $ 3. 10 or $ 5. 60 for brand-name drugs, depending on their income. If these individuals live in nursing homes, they pay no co-payments.

If individuals apply for the LIS through their state's Medicaid program, Medicaid must also screen for eligibility for the MSP. The Social Security Administration (SSA) actually administers the LIS, but it does not screen for MSP eligibility. The federal Medicaid agency shares the SSA information on who qualifies for LIS with state Medicaid agencies to help states screen individuals for full Medicaid or MSP benefits.

COMMITTEE ACTION

Human Services Committee

Joint Favorable Change of Reference

Appropriations Committee

Joint Favorable Substitute