OTHER GOVERNMENT MEDICAL PLANS

Chapter 11


OTHER GOVERNMENT MEDICAL PLANS



Objectives


After completing this chapter, you should be able to:


image Relate facts unique to Medicaid, such as qualifications, patient expenses, coverage, circumstances in which it may interact with Medicare, and/or billing considerations


image Discuss the Indian Health Service


image Relate facts unique to TRICARE/CHAMPUS, such as eligibility, patient expenses, coverage, circumstances in which it may interact with Medicare, and/or billing considerations


image Relate facts unique to CHAMPVA and the VA, such as eligibility, patient expenses, coverage, how Medicare influences coverage, and/or billing considerations



Key Terms



AFDC


Aid to Families with Dependent Children; a government assistance program for those with qualifying low incomes.


authorization number


proof that prior approval was obtained for a specific service: treatment, test, or procedure. It does not guarantee coverage if the claim does not establish medical necessity.


categorically needy


the state is required to give these people Medicaid coverage if the state is to be eligible for federal funds.


CHAMPUS


Civilian Health and Medical Program of the Uniformed Services; the law that established an entitlement program to provide medical coverage for families of military service members.


CHAMPVA


Civilian Health and Medical Program of


Veterans Affairs; the law that established an entitlement program to provide medical coverage for dependents of veterans totally disabled with a service-connected disability and dependents of veterans who died while on active duty and in the line of duty.


deductible


a specified amount of expense the patient must pay before the medical plan pays anything.


DEERS


Defense Enrollment Eligibility Reporting System; the military organization that determines eligibility and issues military ID cards for CHAMPUS.


FPL


federal poverty line.


MedCHAMP


a program for CHAMPUS-eligible persons younger than age 65 who qualify for both Medicare and CHAMPUS. Medicare is the primary payor, and CHAMPUS is the secondary payor.


Medicaid


a government medical program developed to provide coverage for qualified low-income applicants.


Medical Care Cost Recovery Program (MCCRP)


a program developed to enable the Department of Veterans Affairs (VA) to bill third-party payors for non–service-connected care rendered by the VA to veterans, and to collect copayments from veterans with less than a 50% service-connected disability rating for non–service-connected care rendered, based on ability to pay.


medically needy


this option allows states to extend


Medicaid eligibility to additional people as defined by the state—usually people who can meet ordinary expenses but cannot afford medical care.


nonparticipating provider


for Medicaid, a provider who signs a Medicaid contract but does not accept assignment of benefits.


non–service-connected


a medical problem that did not develop during military service and is not related to or caused by military service.


preauthorization


the process of obtaining prior approval before a service: treatment, test, or procedure. It does not guarantee coverage if the claim form does not establish medical necessity.


service-connected


a medical problem that arose while the person was serving on active duty or that was caused by active duty military service, or a problem that was incurred during reserve duty with a military unit.


SSI


Supplemental Security Income; a Social Security program that provides additional income to qualified beneficiaries.


TANF


Temporary Assistance for Needy Families.


TRICARE


a program with three levels of coverage established to administer CHAMPUS.




Medicaid


Medicaid is a government health program for quali-fied low-income and very-low-income applicants. The program is administered by each state, but the federal government provides matching funds and establishes regulations that are tied to those funds. Therefore Medicaid is a state program with federal oversight.




Eligibility is complex. Income guidelines are intended to keep this program only for those with low and very low incomes. All types of income and all types of assets are considered for the income requirements. A child’s eligibility is based upon his or her parents’ income and assets.


Originally, Medicaid was developed as a medical care program tied to federally funded programs that provided cash income assistance for the very poor, with a focus on dependent children and their mothers, the disabled, and the elderly. Over the years, however, Medicaid eligibility has been expanded. Legislation in the late 1980s extended Medicaid coverage to a greater number of low-income pregnant women, children from low-income families, and to some low-income Medicare beneficiaries who are not eligible for any cash assistance programs. To be eligible for federal funds, states are required to provide Medicaid coverage for certain people, some of whom receive federal cash income assistance. The following categorically needy groups qualify for federal Medicaid matching funds:



image People are generally eligible for Medicaid if they meet the requirements for the Aid to. Families with Dependent Children (AFDC) program that were in effect in their state on July 16, 1996. AFDC was a program administered and funded jointly by federal and state governments to provide financial assistance to low-income families with dependent children. Public Law 104-193, the welfare reform bill, repealed AFDC and replaced it with Temporary Assistance for Needy Families (TANF). (Although most persons covered by TANF meet the AFDC requirements and still receive Medicaid, the law does not require Medicaid coverage for everyone in the TANF program.)


image Children younger than age 6 whose family income is at or below 133% of the federal poverty level (FPL)


image Pregnant women whose family income is below 133% of the FPL. Services are limited to those related to pregnancy, complications of pregnancy, delivery, and postpartum care.


image Supplemental Security Income (SSI) recipients in most states (a few states use more restrictive requirements that predate SSI). SSI benefits are available to low-income individuals of any age who have a disability. SSI is part of the Social Security program. Individuals must meet both disability and financial criteria. A child’s financial criteria are based on his or her parents’ resources (assets such as bank accounts, stock, houses, cars, and other valuables) and income.


image Recipients of adoption or foster care assistance under Title IV of the Social Security Act


image Special protected groups (i.e., certain qualified individuals who lose eligibility for cash assistance due to earnings from work or fromincreased Social Security benefits, but who may keep Medicaid for a period)


image All children in families with incomes at or below the FPL


image Certain Medicare beneficiaries


States also have the option of providing Medicaid coverage for other categorically related groups. The broadest of the optional groups for which states may receive federal Medicaid matching funds include the following:



image Infants up to age 1 and pregnant women not covered under the mandatory rules whose family income is no more than 185% of the FPL (The percentage amount is set by each state.)


image Children younger than age 21 who meet the


    AFDC income and resources requirements that were in effect in their state on July 16, 1996 (The child need not have been born before July 16, 1996—the date indicates the date the AFDC program was repealed.)


image Eligible institutionalized people who have less than a designated income level (The amount is set by each state—up to 300% of the SSI federal benefit rate.)


image People who would be eligible if they were institutionalized but who are receiving care under home and community-based service waivers


image Certain aged, blind, or disabled adults who have incomes above those requiring mandatory coverage but below the FPL


image Recipients of state supplementary income payments


image Certain working-and-disabled persons with family income less than 250% of the FPL who would qualify for SSI if they did not work


image TB-infected people who would be financially eligible for Medicaid at the SSI income level if they were within a Medicaid-covered category. Coverage is limited to TB-related ambulatory services and TB drugs.


image Optional targeted low-income children included within the State Children’s Health Insurance Program (SCHIP) established by the Balanced Budget Act (BBA) of 1997 (Public Law 105-33)


image Medically needy beneficiaries who can meet ordinary expenses but cannot afford medical care


The medically needy option allows states to extend Medicaid eligibility to additional people as defined by the state. Usually these people would be eligible for Medicaid under one of the mandatory or optional groups, except that their income and/or resources are above the eligibility level set by their state. These people may qualify whenever they incur medical expenses that reduce their income to or below their state’s medically needy income level. Medicaid benefit provisions for the medically needy are not as extensive as for the categorically needy, and may be quite limited.


Federal matching funds are available for medically needy programs if the state meets the federal requirements: Children younger than age 19 and pregnant women who are medically needy must be covered; and prenatal and delivery care for pregnant women, as well as ambulatory care for children, must be provided. A state may choose to provide medically needy eligibility to certain additional groups and may elect to provide certain additional services within its medically needy program.


Currently, 38 states have elected to have a medically needy program. The remaining states use the special income level option to extend Medicaid to low-income people in medical institutional settings.


The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Public Law 104-193)—known as the welfare reform bill—made several changes regarding eligibility for SSI coverage that affected the Medicaid program:



image Now legal resident aliens and other qualified aliens who entered the United States on or after August 22, 1996, are ineligible for Medicaid for 5 years. It is a state’s option to offer Medicaid coverage for aliens entering before that date and to offer coverage for those eligible after the 5-year ban. Medicaid can only continue for aliens who lose SSI benefits because of the new restrictions if the person is eligible for Medicaid for some other reason. Emergency services, however, are always covered.


image Public Law 104-193 also affected a number of disabled children, who lost SSI as a result of the changes. However, Public Law 105-33, the BBA, reinstituted their eligibility for Medicaid.


image In addition, Public Law 104-193 repealed the federal entitlement program known as Aid to Families with Dependent Children (AFDC) and replaced it with Temporary Assistance for Needy Families (TANF). TANF provides states with grants to be spent on time-limited cash assistance. It generally limits a family’s lifetime cash welfare benefits to a maximum of 5 years and permits states to impose a wide range of other requirements as well—especially those related to employment. However, the impact on Medicaid eligibility is not significant. Under welfare reform, persons who would have been eligible for AFDC under the AFDC requirements in effect on July 16 1996, generally will still be eligible for Medicaid. Although most persons covered by TANF will receive Medicaid, the law does not require it.


Title XXI of the Social Security Act, known as the State Children’s Health Insurance Program (SCHIP), is a new program created by the Balanced Budget Act of 1997. In addition to allowing states to design or expand an existing state insurance program, SCHIP provides more federal funds for states to expand Medicaid eligibility to include a greater number of children who are currently uninsured. With certain exceptions, these are low-income children who would not have qualified for Medicaid before this plan went into effect.


Funds from SCHIP also may be used to provide medical assistance to children during a “presumptive” eligibility period for Medicaid. Medicaid coverage may begin as early as the third month before an application is submitted— if the person would have been eligible for Medicaid during that period, had they applied sooner. This is one of several options from which states may select to provide health care coverage for more children. The BBA allows states to provide 12 months of continuous Medicaid coverage (without reevaluation) for eligible children under the age of 19. Medicaid coverage generally stops at the end of the month in which a person no longer meets the eligibility criteria.


The Ticket to Work and Work Incentives Improvement Act of 1999 (Public Law 106-170) provides or continues Medicaid coverage to certain disabled beneficiaries who work despite their disability. Those with higher incomes may pay a sliding scale premium based on income.


In addition to the above guidelines for people the state is required to cover, each state may establish its own eligibility requirements. They also may determine which services are covered and the amount of reimbursement given for covered services. As long as the federal guidelines are covered within their program, states are free to run their own programs. Most states have additional “state-only” programs that provide medical assistance for specified low-income people who do not qualify for programs with mandated or optional Medicaid coverage tied to federal reimbursement. Federal funds are not provided for state-only programs. To find state-specific Medicaid information, go to the website www.cms.gov and click on the link to Medicaid. From there, follow the directions to each state-specific website.



THE MEDICAID-MEDICARE RELATIONSHIP


Medicare beneficiaries who have low incomes and limited resources also may receive help from the Medicaid program. Because Social Security payments vary based on the income history of each person and because some people have additional sources of income, not everyone who receives Medicare will meet the income requirements to also receive Medicaid.


For those who are eligible for some type of Medicaid coverage, the Medicare health care coverage is supplemented by services that are available under their state’s Medicaid program. Services will vary according to which program the person qualifies for, but could include, for example, nursing facility care beyond the 100-day limit covered by Medicare, prescription drugs, eyeglasses, and hearing aids. The Medicare program pays for any services that are covered by Medicare before any payments are made by the Medicaid program. Medicaid is always the “payor of last resort.”


Some Medicare beneficiaries receive help with Medicare premiums and cost-sharing payments through their state Medicaid program. Qualified Medicare Beneficiaries (QMBs, pronounced “kwim-bees”) and Specified Low-Income Medicare Beneficiaries (SLMBs, pronounced “slim-bees”) are the best-known categories. These programs have the most participants.


QMBs are those Medicare beneficiaries who have resources (assets such as bank accounts, stock, houses, cars, and other valuables) at or below twice the standard allowed under the SSI program, and incomes at or below 100% of the FPL. For QMBs, Medicaid pays the Hospital Insurance (Medicare Part A) and Supplementary Medical Insurance (Medicare Part B) premiums and the Medicare coinsurance and deductibles, subject to limits that states may impose on payment rates.


SLMBs are Medicare beneficiaries with resources (assets) like the QMBs, but with incomes less than 120% of the FPL. For SLMBs, the Medicaid program pays only the Medicare Part B premiums.


A third category of Medicare beneficiaries who may receive help from Medicaid are disabled-and-working individuals. According to the Medicare law, disabled-and-working individuals who previously qualified for Medicare because of disability, but who lost entitlement because of their return to work (despite the disability), are allowed to purchase Medicare Part A and Part B coverage. If these persons have incomes below 200% of the FPL but do not meet any other Medicaid assistance category, they may qualify to have Medicaid pay their Part A premiums as Qualified Disabled and Working Individuals (QDWIs).



MEDICAID SERVICES


Title XIX of the Social Security Act allows considerable flexibility within the states’ Medicaid programs. However, if federal matching funds are received, some federal requirements are mandatory. A state’s Medicaid program must offer medical assistance for certain basic services to most categorically needy populations. These services generally include the following:



(EPSDT) services for children younger than age 21. The EPSDT program is a Medicaid preventive-medicine program. (Some states require an EPSDT exam every year for children younger than age 10 who are enrolled in Medicaid.)


States may also receive federal matching funds to provide certain optional services. Following are the most common of the 34 currently approved optional Medicaid services:



The Balanced Budget Act of 1997 also included a state option known as Programs of All-inclusive Care for the Elderly (PACE). PACE provides an alternative to institutional care for persons age 55 or older who require a nursing facility level of care. The PACE team manages all health, medical, and social services and gathers together other services as needed to provide preventive, rehabilitative, curative, and supportive care. This care can be provided in day health centers, homes, hospitals, and nursing homes. It helps the person maintain independence, dignity, and quality of life.


PACE functions within the Medicare program as well. The individuals enrolled in PACE receive benefits solely through the PACE program. PACE providers receive payment only through the PACE agreement and must make available all items and services covered under both Titles XVIII and XIX, without limitations and without charging any deductibles, copayments, or other cost sharing.


Long-term care is an important provision of Medicaid that is utilized more each year as the baby-boomer population ages. Historically, the Medicaid program has paid for almost 45% of the costs for persons using a nursing facility or home health services. In addition, Medicaid has paid a much larger percentage for people who used more than 4 months of long-term care. Because the percentage of our population that is elderly or disabled is increasing faster than that of the younger groups, the need for long-term care is expected to increase.


Sometimes it is legal to transfer assets to meet the income requirements for Medicaid. This transfer of assets must take place at least 3 to 5 years before receiving benefits. This rule is designed to limit the number of people who are eligible to participate in the program. There are specific instances in which a transfer of assets is allowed without time limits or penalties. Please check with Medicaid to obtain the most current rules.


States may not charge premiums for Medicaid except in rare instances, but they may charge small deductibles and small copayments. Please obtain and read a current set of rules for your state’s Medicaid program to see if any of these costs would apply in your state. Many states now offer a variety of types of health plans, including HMOs, in their Medicaid programs.


Each state chooses an insurance company to administer Medicaid for that state. This company is called the fiscal intermediary (FI) for that state. The FI functions just like a regular insurance company, except it must follow the state and federal regulations for Medicaid instead of their own policies for their Medicaid clients.



BILLING CONSIDERATIONS


Medicaid eligibility can change monthly. Some states issue new ID cards each month, and some states use an ID card similar to a credit card for instant eligibility verification. Eligibility must be effective on the date care is rendered, or payment will be denied.


Medicare is always primary when both Medicare and Medicaid may be billed. However, Medicaid only pays the portion of the fee that does not exceed Medicaid’s allowable payment. When the portion of the bill paid by Medicare exceeds the Medicaid allowable, no Medicaid payment is issued.


Medicaid never covers services that are available from any other plan, including Medicare. However, within a particular Medicaid program’s limitations, Medicaid might cover a variety of noncovered services, such as hearing aids.


A Medicaid physician who sees patients covered by both Medicare and Medicaid must participate in both in order to receive payment from both. If the physician only participates in Medicaid, he or she must enroll in Medicare in order to receive payment from Medicare, or the physician will lose the money Medicare would have paid.


Several blocks on the claim form are set aside for Medicaid use. Block No. 10d, Reserved for Local Use, block No. 22, Medicaid Resubmission Code, and block No. 24H, EPSDT Family Plan on the claim form are not used by any other payor. The patient’s Medicaid number, preceded by MCD, is placed in block No. 10d, Reserved for Local Use. The Medicaid resubmission code and original reference number are placed in block No. 22, Medicaid Resubmission Code. EPSDT claims will have a “Y” entered in block No. 24H, EPSDT Family Plan.


To reduce patient fraud, some states use electronic ID cards. These cards are swiped in the same manner as a credit card is swiped during patient registration to obtain instant eligibility verification. In some states, Medicaid requires direct deposit for provider payments.


Each state also has state-specific requirements that must be met. For example: In one state, the physician enrollment packet includes notarized finger-printing and a background check. Claims sent to Medicaid in that state must be sent on paper because they require original “wet ink” signatures in the signature boxes. When the claims arrive at Medicaid, they are scanned into the system. Correction fluid smears when it is scanned, so errors may only be corrected using correction tape. Medicaid in that state requires special codes that must be entered in block No. 19, Reserved for Local Use, to identify the type of claim; the applicable codes are found in the Medicaid workbook. Also, Medicaid in that state requires the entire diagnosis code number, not the line number from block No. 21, Diagnosis or Nature of Illness or Injury, to be entered in block No. 24E, Diagnosis Code, to link the diagnosis to the procedure.


In many states, Medicaid does not allow the use of global (bundled) codes when billing for pregnancies. Each individual service is billed separately (unbundled). This is because eligibility can change many times during a 9-month pregnancy.


The most common error on Medicaid claims is a missing provider number in block No. 24K, Reserved for Local Use, and a missing referring physician Medicaid ID number in block No. 17a, ID Number of the Referring Physician. The provider’s Medicaid ID number can be 6 to 10 digits long, depending on the state.


Many states do not update the Medicaid computer systems very often, so they require the use of code-books from previous years. For example, many states require the use of codebooks from 1995 or 1996 to code Medicaid claims, although the Medicaid fee schedule does keep up with the times by changing every year. Check with your state’s Medicaid FI for billing rules specific to your state. See Appendix B or go to the CMS website for Medicaid to find contact information and the FI for each state.



STOP & REVIEW


Answer the following questions:


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May 25, 2017 | Posted by in GENERAL & FAMILY MEDICINE | Comments Off on OTHER GOVERNMENT MEDICAL PLANS

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