What are other important implications of the Deficit Reducation Act?

June 2006

Can you expand on the important implications of the Deficit Reduction Act to Medicaid eligibilty? Besides the new requirements for Proof of Citizenship, what are other important changes?

Proof of Citizenship
Beginning July 1, 2006, all new Medicaid applicants and all current Medicaid enrollees who are due to reapply must demonstrate that they are either United States citizens or residing in the United States on a current legal visa. On June 9, the Federal Department of Health and Human Services (HHS) issued a guidance letter and fact sheet that specified what documents are needed to establish citizenship or legal immigration status under the new Act. The list contains “primary” documents, which are documents that are sufficient to establish citizenship or status on their own, and “secondary” or “tertiary” documents, which are documents that can be used in conjunction with an “identity” document, such as a drivers’ license, to establish citizenship or status when primary documents are not available. The list, from primary to tertiary documents, includes:
• current U.S. passport or naturalization visa;
• birth certificate or adoption decree;
• proof of military service that shows U.S. place of birth.

Other documents, including hospital admission records, birth records, or affidavits, may be used in rare circumstance when no other source is available. The HHS guidance letter and fact sheet can be found on the CMS Web site, http://www.cms.gov, at the following location: http://www.cms.hhs.gov/MedicaidEligibility/05_ProofofCitizenship.asp.

In addition, the Bazelon Center for Mental Health Law contains extensive discussions on all of the changes in the Deficit Reduction Act: http://www.bazelon.org.

Limits on Targeted Case Management
There is no change in the definition of Targeted Case Management (TCM) that is now in the law. However, TCM must be specific to certain classes of individuals, such as children with Severe Emotional Disturbances (SED) or physical disabilities. The TCM must be documented to directly relate to the management of the individual’s health care. Therefore, no Medicaid dollars may be paid for foster care services. In addition, Medicaid may not pay for services that would be reimbursed under a social, educational or other program. The President’s 2007 budget proposes more cutbacks, including limits to TCM.

State Children’s Health Insurance Program Benchmark Plans
Medicaid State agencies will have the option to move certain groups of Medicaid enrollees into plans that are the same as those offered under the State Children’s Health Insurance Program (SCHIP). Under SCHIP, States may offer narrower service coverage than that which Medicaid is now mandated to offer, specifically under the Early Periodic Screening, Diagnosis and Treatment Program (EPSDT). Under EPSDT, all diagnostic and treatment services that are found to be medically necessary as determined by a screen must be provided. This change will allow States to choose to limit this coverage and have it operate like private insurance, which in general has much more limited benefits, especially for mental health and wrap-around services. This potential change could have implications for mental health services offered under Medicaid.

Children and adolescents that are immune to the coverage change under Medicaid include those that are eligible through the following programs: Temporary Assistance to Needy Families (TANF), Supplemental Security Income (SSI), TEFRA/Katie Beckett, and those with spend-down requirements.

An extensive discussion of Medicaid eligibility requirements and terminology has been provided by the “Financing Systems of Care” series of Web-based conferences (Webinars) produced by the TA Partnership. Recorded Webinars can be found on the TA Partnership Web site at the following location: http://www.tapartnership.org/learning_opp/list.asp.

Premiums and Copayment Options
Effective January 1, 2007, States may impose premiums (including an enrollment fee or similar charge), deductions, and co-payments for groups of Medicaid-eligible individuals and for services. Prior law limits cost sharing to a co-payment of no more than $3 for any service. In addition, for the first time Medicaid beneficiaries can be denied coverage for failure to pay their premium within 60 days and denied a service if they fail to pay co-payments. Children and adolescents whose family income is between 100 -150% of the Federal Poverty Level (FPL) will have no cost sharing. However, children over 150% FPL may be charged 20% co-payments (e.g. 20% of the cost of a visit to a provider) for up to 5% of the family’s income. The Federal Poverty Guidelines are published yearly at the HHS Web site at the following location: http://aspe.hhs.gov/poverty/06poverty.shtml.

Technical Assistance Partnership for Child and Family Mental Health

Primary Care and Systems of Care
Frequently Asked Questions

Home About Us About Systems of Care Contact Us Events & Presentations Newsletter Consultant Pool Special Topics Column Grantee Locator Webinars Resource Specialties Child Welfare Education Family Involvement Juvenile Justice Mental Health Primary Care Substance Abuse Sustainability Youth Involvement Regional Technical Assistance Region I Region II Region III Region IV Region V Region VI Communities of Practice Cultural and Linguistic Competence Early Childhood Transition-Aged Youth	Primary Care and Systems of Care Frequently Asked Questions
	June 2006 Can you expand on the important implications of the Deficit Reduction Act to Medicaid eligibilty? Besides the new requirements for Proof of Citizenship, what are other important changes? Proof of Citizenship Beginning July 1, 2006, all new Medicaid applicants and all current Medicaid enrollees who are due to reapply must demonstrate that they are either United States citizens or residing in the United States on a current legal visa. On June 9, the Federal Department of Health and Human Services (HHS) issued a guidance letter and fact sheet that specified what documents are needed to establish citizenship or legal immigration status under the new Act. The list contains “primary” documents, which are documents that are sufficient to establish citizenship or status on their own, and “secondary” or “tertiary” documents, which are documents that can be used in conjunction with an “identity” document, such as a drivers’ license, to establish citizenship or status when primary documents are not available. The list, from primary to tertiary documents, includes: • current U.S. passport or naturalization visa; • birth certificate or adoption decree; • proof of military service that shows U.S. place of birth. Other documents, including hospital admission records, birth records, or affidavits, may be used in rare circumstance when no other source is available. The HHS guidance letter and fact sheet can be found on the CMS Web site, http://www.cms.gov, at the following location: http://www.cms.hhs.gov/MedicaidEligibility/05_ProofofCitizenship.asp. In addition, the Bazelon Center for Mental Health Law contains extensive discussions on all of the changes in the Deficit Reduction Act: http://www.bazelon.org. Limits on Targeted Case Management There is no change in the definition of Targeted Case Management (TCM) that is now in the law. However, TCM must be specific to certain classes of individuals, such as children with Severe Emotional Disturbances (SED) or physical disabilities. The TCM must be documented to directly relate to the management of the individual’s health care. Therefore, no Medicaid dollars may be paid for foster care services. In addition, Medicaid may not pay for services that would be reimbursed under a social, educational or other program. The President’s 2007 budget proposes more cutbacks, including limits to TCM. State Children’s Health Insurance Program Benchmark Plans Medicaid State agencies will have the option to move certain groups of Medicaid enrollees into plans that are the same as those offered under the State Children’s Health Insurance Program (SCHIP). Under SCHIP, States may offer narrower service coverage than that which Medicaid is now mandated to offer, specifically under the Early Periodic Screening, Diagnosis and Treatment Program (EPSDT). Under EPSDT, all diagnostic and treatment services that are found to be medically necessary as determined by a screen must be provided. This change will allow States to choose to limit this coverage and have it operate like private insurance, which in general has much more limited benefits, especially for mental health and wrap-around services. This potential change could have implications for mental health services offered under Medicaid. Children and adolescents that are immune to the coverage change under Medicaid include those that are eligible through the following programs: Temporary Assistance to Needy Families (TANF), Supplemental Security Income (SSI), TEFRA/Katie Beckett, and those with spend-down requirements. An extensive discussion of Medicaid eligibility requirements and terminology has been provided by the “Financing Systems of Care” series of Web-based conferences (Webinars) produced by the TA Partnership. Recorded Webinars can be found on the TA Partnership Web site at the following location: http://www.tapartnership.org/learning_opp/list.asp. Premiums and Copayment Options Effective January 1, 2007, States may impose premiums (including an enrollment fee or similar charge), deductions, and co-payments for groups of Medicaid-eligible individuals and for services. Prior law limits cost sharing to a co-payment of no more than $3 for any service. In addition, for the first time Medicaid beneficiaries can be denied coverage for failure to pay their premium within 60 days and denied a service if they fail to pay co-payments. Children and adolescents whose family income is between 100 -150% of the Federal Poverty Level (FPL) will have no cost sharing. However, children over 150% FPL may be charged 20% co-payments (e.g. 20% of the cost of a visit to a provider) for up to 5% of the family’s income. The Federal Poverty Guidelines are published yearly at the HHS Web site at the following location: http://aspe.hhs.gov/poverty/06poverty.shtml.

Technical Assistance Partnership for Child and Family Mental Health

Primary Care and Systems of Care Frequently Asked Questions

Primary Care and Systems of Care
Frequently Asked Questions