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Title XIX of the Social Security Act is a Federal/State entitlement program that pays for medical assistance for certain individuals and families with low incomes and resources. This program, known as Medicaid, became law in 1965 as a cooperative venture jointly funded by the Federal and State governments (including the District of Columbia and the Territories) to assist States in furnishing medical assistance to eligible needy persons. Medicaid is the largest source of funding for medical and health-related services for America’s poorest people.
Within broad national guidelines established by Federal statutes, regulations, and policies, each State (1) establishes its own eligibility standards; (2) determines the type, amount, duration, and scope of services; (3) sets the rate of payment for services; and (4) administers its own program. Medicaid policies for eligibility, services, and payment are complex and vary considerably, even among States of similar size or geographic proximity. Thus, a person who is eligible for Medicaid in one State may not be eligible in another State, and the services provided by one State may differ considerably in amount, duration, or scope from services provided in a similar or neighboring State. In addition, State legislatures may change Medicaid eligibility, services, and/or reimbursement during the year.
Medicaid does not provide medical assistance for all poor persons. Under the broadest provisions of the Federal statute, Medicaid does not provide health care services even for very poor persons unless they are in one of the groups designated below. Low income is only one test for Medicaid eligibility for those within these groups; their resources also are tested against threshold levels (as determined by each State within Federal guidelines).
States generally have broad discretion in determining which groups their Medicaid programs will cover and the financial criteria for Medicaid eligibility. To be eligible for Federal funds, however, States are required to provide Medicaid coverage for certain individuals who receive federally assisted income-maintenance payments, as well as for related groups not receiving cash payments. In addition to their Medicaid programs, most States have additional “State-only” programs to provide medical assistance for specified poor persons who do not qualify for Medicaid. Federal funds are not provided for State-only programs. The following enumerates the mandatory Medicaid “categorically needy” eligibility groups for which Federal matching funds are provided:
States also have the option of providing Medicaid coverage for other “categorically related” groups. These optional groups share characteristics of the mandatory groups (that is, they fall within defined categories), but the eligibility criteria are somewhat more liberally defined. The broadest optional groups for which States will receive Federal matching funds for coverage under the Medicaid program include the following:
The medically needy (MN) option allows States to extend Medicaid eligibility to additional persons. These persons 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. Persons may qualify immediately or may “spend down” by incurring medical expenses that reduce their income to or below their State’s MN income level.
Medicaid eligibility and benefit provisions for the medically needy do not have to be as extensive as for the categorically needy, and may be quite restrictive. Federal matching funds are available for MN programs. However, if a State elects to have a MN program, there are Federal requirements that certain groups and certain services must be included; that is, children under 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 elect to provide MN eligibility to certain additional groups and may elect to provide certain additional services within its MN program. As of August 2002, thirty-five States plus the District of Columbia have elected to have a MN program and are providing at least some MN services to at least some MN beneficiaries. All remaining States utilize the “special income level” option to extend Medicaid to the “near poor” 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 restrictive changes regarding eligibility for SSI coverage that impacted the Medicaid program. For example, 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. Medicaid coverage for most aliens entering before that date and coverage for those eligible after the 5-year ban are State options; emergency services, however, are mandatory for both of these alien coverage groups. For aliens who lose SSI benefits because of the new restrictions regarding SSI coverage, Medicaid can continue only if these persons can be covered for Medicaid under some other eligibility status (again with the exception of emergency services, which are mandatory). Public Law 104-193 also affected a number of disabled children, who lost SSI as a result of the restrictive changes; however, their eligibility for Medicaid was reinstituted by Public Law 105-33, the BBA.
In addition, welfare reform repealed the open-ended Federal entitlement program known as Aid to Families with Dependent Children (AFDC) and replaced it with Temporary Assistance for Needy Families (TANF), which provides States with grants to be spent on time-limited cash assistance. TANF 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—in particular, those related to employment. However, the impact on Medicaid eligibility is not expected to be 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, it is not required by law.
Title XXI of the Social Security Act, known as the State Children’s Health Insurance Program (SCHIP), is a new program initiated by the BBA. In addition to allowing States to craft 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 qualify for Medicaid based on the plan that was in effect on April 15, 1997. Funds from SCHIP also may be used to provide medical assistance to children during a presumptive eligibility period for Medicaid. This is one of several options from which States may select to provide health care coverage for more children, as prescribed within the BBA’s Title XXI program.
Medicaid coverage may begin as early as the third month prior to application—if the person would have been eligible for Medicaid had he or she applied during that time. Medicaid coverage generally stops at the end of the month in which a person no longer meets the criteria of any Medicaid eligibility group. The BBA allows States to provide 12 months of continuous Medicaid coverage (without reevaluation) for eligible children under the age of 19.
The Ticket to Work and Work Incentives Improvement Act of 1999 (Public Law 106170) 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.
Title XIX of the Social Security Act allows considerable flexibility within the States’ Medicaid plans. However, some Federal requirements are mandatory if Federal matching funds are to be received. A State’s Medicaid program must offer medical assistance for certain basic services to most categorically needy populations. These services generally include the following:
States may also receive Federal matching funds to provide certain optional services. Following are the most common of the thirty-four currently approved optional Medicaid services:
The BBA included a State option known as Programs of All-inclusive Care for the Elderly (PACE). PACE provides an alternative to institutional care for persons aged 55 or older who require a nursing facility level of care. The PACE team offers and manages all health, medical, and social services and mobilizes other services as needed to provide preventative, rehabilitative, curative, and supportive care. This care, provided in day health centers, homes, hospitals, and nursing homes, helps the person maintain independence, dignity, and quality of life. PACE functions within the Medicare program as well. Regardless of source of payment, 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 amount, duration, or scope limitations and without application of any deductibles, copayments, or other cost sharing. The individuals enrolled in PACE receive benefits solely through the PACE program.
Within broad Federal guidelines and certain limitations, States determine the amount and duration of services offered under their Medicaid programs. States may limit, for example, the number of days of hospital care or the number of physician visits covered. Two restrictions apply: (1) limits must result in a sufficient level of services to reasonably achieve the purpose of the benefits; and (2) limits on benefits may not discriminate among beneficiaries based on medical diagnosis or condition.
In general, States are required to provide comparable amounts, duration, and scope of services to all categorically needy and categorically related eligible persons. There are two important exceptions: (1) Medically necessary health care services that are identified under the EPSDT program for eligible children, and that are within the scope of mandatory or optional services under Federal law, must be covered even if those services are not included as part of the covered services in that State’s Plan; and (2) States may request “waivers” to pay for otherwise uncovered home and community-based services (HCBS) for Medicaid-eligible persons who might otherwise be institutionalized. As long as the services are cost effective, States have few limitations on the services that may be covered under these waivers (except that, other than as a part of respite care, States may not provide room and board for the beneficiaries). With certain exceptions, a State’s Medicaid program must allow beneficiaries to have some informed choices among participating providers of health care and to receive quality care that is appropriate and timely.
Medicaid operates as a vendor payment program. States may pay health care providers directly on a fee-for-service basis, or States may pay for Medicaid services through various prepayment arrangements, such as health maintenance organizations (HMOs). Within federally imposed upper limits and specific restrictions, each State for the most part has broad discretion in determining the payment methodology and payment rate for services. Generally, payment rates must be sufficient to enlist enough providers so that covered services are available at least to the extent that comparable care and services are available to the general population within that geographic area. Providers participating in Medicaid must accept Medicaid payment rates as payment in full. States must make additional payments to qualified hospitals that provide inpatient services to a disproportionate number of Medicaid beneficiaries and/or to other low-income or uninsured persons under what is known as the “disproportionate share hospital” (DSH) adjustment. During 1988-1991, excessive and inappropriate use of the DSH adjustment resulted in rapidly increasing Federal expenditures for Medicaid. Under legislation passed in 1991, 1993, and again within the BBA of 1997, the Federal share of payments to DSH hospitals was somewhat limited. However, the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act (BIPA) of 2000 (Public Law 106-554) increased DSH allotments for 2001 and 2002 and made other changes to DSH provisions that resulted in increased costs to the Medicaid program.
States may impose nominal deductibles, coinsurance, or copayments on some Medicaid beneficiaries for certain services. The following Medicaid beneficiaries, however, must be excluded from cost sharing: pregnant women, children under age 18, and hospital or nursing home patients who are expected to contribute most of their income to institutional care. In addition, all Medicaid beneficiaries must be exempt from copayments for emergency services and family planning services.
The Federal Government pays a share of the medical assistance expenditures under each State’s Medicaid program. That share, known as the Federal Medical Assistance Percentage (FMAP), is determined annually by a formula that compares the State’s average per capita income level with the national income average. States with a higher per capita income level are reimbursed a smaller share of their costs. By law, the FMAP cannot be lower than 50 percent or higher than 83 percent. In fiscal year (FY) 2004, the FMAPs varied from 50 percent in twelve States to 77.08 percent in Mississippi, and averaged 60.2 percent overall. The BBA also permanently raised the FMAP for the District of Columbia from 50 percent to 70 percent and raised the FMAP for Alaska from 50 percent to 59.8 percent through 2000. The BIPA of 2000 further adjusted Alaska’s FMAP to a higher level for FY 2001-2005. The Jobs and Growth Tax Relief Reconciliation Act of 2003 (Public Law 108-27), in order to bring about State fiscal relief in the current troubled economy, has made three temporary modifications to the States’ FMAP calculation: (1) the FMAP for the last two quarters of 2003 will equal the greater of the current law FMAPs for 2002 or 2003; (2) the FMAP for the first three quarters of 2004 will equal the greater of the current law FMAPs for 2003 or 2004; and (3) for the last two quarters of 2003 and first three quarters of 2004, the newly calculated (under 1 and 2 above) FMAP will increase by 2.95 percentage points. The Federal Government pays States a higher share for children covered through the SCHIP program. This “enhanced” FMAP averages about 70 percent for all States, compared to the general Medicaid average of 60.2 percent.
The Federal Government also reimburses States for 100 percent of the cost of services provided through facilities of the Indian Health Service, provides financial help to the twelve States that furnish the highest number of emergency services to undocumented aliens, and shares in each State’s expenditures for the administration of the Medicaid program. Most administrative costs are matched at 50 percent, although higher percentages are paid for certain activities and functions, such as development of mechanized claims processing systems.
Except for the SCHIP program, the Qualifying Individuals (QI) program (described later), and DSH payments, Federal payments to States for medical assistance have no set limit (cap). Rather, the Federal Government matches (at FMAP rates) State expenditures for the mandatory services, as well as for the optional services that the individual State decides to cover for eligible beneficiaries, and matches (at the appropriate administrative rate) all necessary and proper administrative costs. The Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (as incorporated into Public Law 106-113, the appropriations bill for the District of Columbia for FY 2000) increased the amount that certain States and the territories can spend on DSH and SCHIP payments, respectively. The BIPA set upper payment limits for inpatient and outpatient services provided by certain types of facilities.
Medicaid was initially formulated as a medical care extension of federally funded programs providing cash income assistance for the poor, with an emphasis on dependent children and their mothers, the disabled, and the elderly. Over the years, however, Medicaid eligibility has been incrementally expanded beyond its original ties with eligibility for cash programs. Legislation in the late 1980s assured Medicaid coverage to an expanded number of low-income pregnant women, poor children, and to some Medicare beneficiaries who are not eligible for any cash assistance program. Legislative changes also focused on increased access, better quality of care, specific benefits, enhanced outreach programs, and fewer limits on services.
In most years since its inception, Medicaid has had very rapid growth in expenditures. This rapid growth has been due primarily to the following factors:
As with all health insurance programs, most Medicaid beneficiaries incur relatively small average expenditures per person each year, and a relatively small proportion incurs very large costs. Moreover, the average cost varies substantially by type of beneficiary. National data for 2001, for example, indicate that Medicaid payments for services for 23.3 million children, who constitute 50 percent of all Medicaid beneficiaries, average about $1,305 per child (a relatively small average expenditure per person). Similarly, for 11.6 million adults, who comprise 25 percent of beneficiaries, payments average about $1,725 per person. However, certain other specific groups have much larger per-person expenditures. Medicaid payments for services for 4.4 million aged, constituting 9 percent of all Medicaid beneficiaries, average about $10,965 per person; for 7.7 million disabled, who comprise 16 percent of beneficiaries, payments average about $10,455 per person. When expenditures for these high- and lower-cost beneficiaries are combined, the 2001 payments to health care vendors for 47.0 million Medicaid beneficiaries average $3,965 per person.
Long-term care is an important provision of Medicaid that will be increasingly utilized as our nation’s population ages. The Medicaid program paid for over 41 percent of the total cost of care for persons using nursing facility or home health services in 2001. National data for 2001 show that Medicaid payments for nursing facility services (excluding ICFs/MR) totaled $37.2 billion for more than 1.7 million beneficiaries of these services—an average expenditure of $21,890 per nursing home beneficiary. The national data also show that Medicaid payments for home health services totaled $3.5 billion for more than 1.0 million beneficiaries—an average expenditure of $3,475 per home health care beneficiary. With the percentage of our population who are elderly or disabled increasing faster than that of the younger groups, the need for long-term care is expected to increase.
Another significant development in Medicaid is the growth in managed care as an alternative service delivery concept different from the traditional fee-for-service system. Under managed care systems, HMOs, prepaid health plans (PHPs), or comparable entities agree to provide a specific set of services to Medicaid enrollees, usually in return for a predetermined periodic payment per enrollee. Managed care programs seek to enhance access to quality care in a cost-effective manner. Waivers may provide the States with greater flexibility in the design and implementation of their Medicaid managed care programs. Waiver authority under sections 1915(b) and 1115 of the Social Security Act is an important part of the Medicaid program. Section 1915(b) waivers allow States to develop innovative health care delivery or reimbursement systems. Section 1115 waivers allow Statewide health care reform experimental demonstrations to cover uninsured populations and to test new delivery systems without increasing costs. Finally, the BBA provided States a new option to use managed care. The number of Medicaid beneficiaries enrolled in some form of managed care program is growing rapidly, from 14 percent of enrollees in 1993 to 59 percent in 2003.
More than 46.0 million persons received health care services through the Medicaid program in FY 2001 (the last year for which beneficiary data are available). In FY 2003, total outlays for the Medicaid program (Federal and State) were $278.3 billion, including direct payment to providers of $197.3 billion, payments for various premiums (for HMOs, Medicare, etc.) of $52.1 billion, payments to disproportionate share hospitals of $12.9 billion, and administrative costs of $16.0 billion. Outlays under the SCHIP program in FY 2003 were $6.1 billion. With no changes to either program, expenditures under Medicaid and SCHIP are projected to reach $445 billion and $7.5 billion, respectively, by FY 2009.
Medicare beneficiaries who have low incomes and limited resources may also receive help from the Medicaid program. For such persons who are eligible for full Medicaid coverage, the Medicare health care coverage is supplemented by services that are available under their State’s Medicaid program, according to eligibility category. These additional services may include, for example, nursing facility care beyond the 100-day limit covered by Medicare, prescription drugs, eyeglasses, and hearing aids. For persons enrolled in both programs, any services that are covered by Medicare are paid for by the Medicare program before any payments are made by the Medicaid program, since Medicaid is always the “payer of last resort.”
Certain other Medicare beneficiaries may receive help with Medicare premium and cost-sharing payments through their State Medicaid program. Qualified Medicare Beneficiaries (QMBs) and Specified Low-Income Medicare Beneficiaries (SLMBs) are the best-known categories and the largest in numbers. QMBs are those Medicare beneficiaries who have resources at or below twice the standard allowed under the SSI program, and incomes at or below 100 percent of the FPL. For QMBs, Medicaid pays the Hospital Insurance (HI, or Part A) and Supplementary Medical Insurance (SMI) 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 like the QMBs, but with incomes that are higher, though still less than 120 percent of the FPL. For SLMBs, the Medicaid program pays only the Part B premiums. A third category of Medicare beneficiaries who may receive help consists of dis-abled-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 percent 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).
For Medicare beneficiaries with incomes that are above 120 percent and less than 175 percent of the FPL, the BBA establishes a capped allocation to States, for each of the 5 years beginning January 1998, for payment of all or some of the Medicare Part B premiums. These beneficiaries are known as Qualifying Individuals (QIs). Unlike QMBs and SLMBs, who may be eligible for other Medicaid benefits in addition to their QMB/SLMB benefits, the QIs cannot be otherwise eligible for medical assistance under a State plan. The payment of this QI benefit is 100 percent federally funded, up to the State’s allocation.
The Centers for Medicare & Medicaid Services (CMS) estimates that Medicaid currently provides some level of supplemental health coverage for about 6.5 million Medicare beneficiaries.
Starting January 2006, the new Medicare prescription drug benefit will provide drug coverage for Medicare beneficiaries, including those who also receive coverage from Medicaid. In addition, individuals eligible for both Medicare and Medicaid will also receive the low-income subsidy for both the Medicare drug plan premium and assistance with cost sharing for prescriptions. Medicaid will no longer provide drug benefits for Medicare beneficiaries.
Since the Medicare drug benefit and low-income subsidy will replace a portion of State Medicaid expenditures for drugs, States would see a reduction in Medicaid expenditures. To offset this reduction, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108-173) requires each State to make a monthly payment to Medicare representing a percentage of the projected reduction. For 2006 this payment is 90 percent of the projected 2006 reduction in State spending. After 2006 the percentage decreases by 1-2/3 percent per year to 75 percent for 2014 and later.
(Section 1917(c) of the Social Security Act; U.S. Code Reference 42 U.S.C. 1396p(c))
Under the transfer of assets provisions, States must withhold payment for various long-term care services for individuals who dispose of assets for less than fair market value. The term “assets” includes both resources and income.
These provisions apply when assets are transferred by individuals in long-term care facilities or receiving home and community-based waiver services, or by their spouses, or someone else acting on their behalf. At State option, these provisions can also apply to various other eligibility groups.
States can “look back” to find transfers of assets for 36 months prior to the date the individual is institutionalized or, if later, the date he or she applies for Medicaid. For certain trusts, this look- back period extends to 60 months.
If a transfer of assets for less than fair market value is found, the State must withhold payment for nursing facility care (and certain other long-term care services) for a period of time referred to as the penalty period.
The length of the penalty period is determined by dividing the value of the transferred asset by the average monthly private-pay rate for nursing facility care in the State. Example: A transferred asset worth $90,000, divided by a $3,000 average monthly private-pay rate, results in a 30-month penalty period. There is no limit to the length of the penalty period.
For certain types of transfers, these penalties are not applied. The principal exceptions are:
(Section 1917(d) of the Social Security Act; U.S. Code Reference 42 U.S.C. 1396p(d))
Where an individual, his or her spouse, or anyone acting on the individual’s behalf, establishes a trust using at least some of the individual’s funds, that trust can be considered available to the individual for purposes of determining eligibility for Medicaid.
In determining whether the trust is available, no consideration is given to the purpose of the trust, the trustee’s discretion in administering the trust, use restrictions in the trust, exculpatory clauses, or restrictions on distributions.
How a trust is treated depends to some extent on what type of trust it is; for example, whether it is revocable or irrevocable, and what specific requirements and conditions the trust contains. In general, however, payments actually made to or for the benefit of the individual are treated as income to the individual. Amounts that could be paid to or for the benefit of the individual, but are not, are treated as available resources. Amounts that could be paid to or for the benefit of the individual, but are paid to someone else, are treated as transfers of assets for less than fair market value. Amounts that cannot, in any way, be paid to or for the benefit of the individual are also treated as transfers of assets for less than fair market value.
Certain trusts are not counted as being available to the individual. They are:
In all of the above instances, the trust must provide that the State receives any funds, up to the amount of Medicaid benefits paid on behalf of the individual, remaining in the trust when the individual dies. A trust will not be counted as available to the individual where the State determines that counting the trust would work an undue hardship.
(Section 1924 of the Social Security Act; U.S. Code Reference 42 U.S.C. 1396r-5)
The expense of nursing home care which ranges from $3,000 to $5,000 a month or more can rapidly deplete the lifetime savings of elderly couples. In 1988, Congress enacted provisions to prevent what has come to be called “spousal impoverishment,” which can leave the spouse who is still living at home in the community with little or no income or resources. These provisions help ensure that this situation will not occur and that community spouses are able to live out their lives with independence and dignity.
The spousal impoverishment provisions apply when one member of a couple enters a nursing facility or other medical institution and is expected to remain there for at least 30 days. When the couple applies for Medicaid, an assessment of their resources is made. The couple’s resources, regardless of ownership, are combined. The couple’s home, household goods, an automobile, and burial funds are not included in the couple’s combined resources. The result is the couple’s combined countable resources. This amount is then used to determine the Spousal Share, which is one-half of the couple’s combined resources. To determine whether the spouse residing in a medical facility meets the State’s resource standard for Medicaid, the following procedure is used:
From the couple’s combined countable resources, a Protected Resource Amount (PRA) is subtracted. The PRA is the greatest of:
After the PRA is subtracted from the couple’s combined countable resources, the remainder is considered available to the spouse residing in the medical institution as countable resources. If the amount of countable resources is below the State’s resource standard, the individual is eligible for Medicaid. Once resource eligibility is determined, any resources belonging to the community spouse are no longer considered available to the spouse in the medical facility.
The community spouse’s income is not considered available to the spouse who is in the medical facility, and the two individuals are not considered a couple for income eligibility purposes. The State uses the income eligibility standard for one person rather than two, and the standard income eligibility process for Medicaid is used.
This process is followed after an individual in a nursing facility/medical institution is determined to be eligible for Medicaid. The post-eligibility process is used to determine how much the spouse in the medical facility must contribute toward his/her cost of nursing facility/ institutional care. This process also determines how much of the income of the spouse who is in the medical facility is actually protected for use by the community spouse. The process starts by determining the total income of the spouse in the medical facility. From that spouse’s total income, the following items are deducted:
The community spouse’s monthly income allowance is the amount of the institutionalized spouse’s income that is actually made available to the community spouse. If the community spouse has income of his or her own, the amount of that income is deducted from the community spouse’s monthly income allowance. Similarly, any income of family members, such as dependent children, is deducted from the family monthly income allowance. Once the above items are deducted from the institutionalized spouse’s income, any remaining income is contributed toward the cost of his or her care in the institution.
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), as amended, significantly changed the eligibility of non-citizens for Federal means-tested public benefits, including Medicaid and the State Children’s Health Insurance Program (SCHIP). As a general rule, only “qualified aliens” may be eligible for coverage. In addition, some immigrants cannot be eligible for coverage for 5 years from the date they enter the Country as a qualified alien. Finally, in determining the eligibility of some immigrants, the income and resources of the immigrant’s sponsor must be counted in determining the immigrant’s eligibility. The questions and answers provided on this website help to explain the current rules governing immigrants’ eligibility for Medicaid and SCHIP.
To be eligible for Medicaid, SCHIP or other means-tested public benefits, a non-citizen must be a “qualified alien.”
The Personal Responsibility and Work Opportunity and Reconciliation Act of 1996, P.L. 104193 (PRWORA) substantially restricted immigrants’ eligibility for means-tested benefits programs, including Medicaid and the State Children’s Health Insurance Program (SCHIP). In particular, with few exceptions, PRWORA restricts eligibility for such programs to “qualified aliens.” Qualified aliens include:
In states that confer automatic eligibility to SSI recipients, non-qualified aliens who are receiving SSI also are eligible for Medicaid. In addition, certain non-citizen Native Americans are exempt from the requirement that non-citizens be a qualified alien in order to be eligible for SSI, Food Stamps and Medicaid. Those subject to this exemption include (1) members of a Federally-recognized Indian tribe, as defined in §4(e) of the Indian Self-Determination and Education Assistance Act, 25 USC 450b(e), and (2) American Indians born in Canada to whom §289 of the INA applies (“§289 Native Americans”). Finally, undocumented immigrants and other non-qualified aliens are eligible under Medicaid for treatment of emergency medical conditions, provided that they otherwise meet the eligibility criteria for the state’s Medicaid program.
No. Prior to PRWORA, only immigrants lawfully admitted for permanent residence and immigrants permanently residing in the United State under color of law (so-called “PRUCOL” immigrants) were eligible for full Medicaid coverage. (The legislation creating SCHIP was passed after PRWORA, so there were no pre-PRWORA rules governing immigrants’ eligibility for SCHIP.) PRWORA created new eligibility criteria for immigrants. The previous “PRUCOL” categories are no longer relevant to determining an immigrant’s eligibility for benefits.
Certain immigrants are not eligible for Medicaid or SCHIP for five years from the date they enter the United States in a qualified-alien status.
The five-year bar only applies to qualified aliens who entered the United States on or after August 22, 1996. In addition, several categories of qualified aliens are exempt from the bar, regardless of their date of entry into the country. (The exemptions are discussed below.) As a practical matter, the following qualified aliens are subject to the five-year bar to eligibility for both Medicaid and SCHIP (1) if the immigrant entered the United States on or after August 22, 1996 and (2) unless the immigrant qualifies for one of the exemptions discussed below:
In addition, the following qualified aliens are subject to the five-year bar to eligibility for separate state programs under SCHIP, unless the immigrant qualifies for one of the exemptions discussed in question 5:
The following qualified aliens are exempt from the five-year bar to eligibility for both Medicaid and SCHIP:
In addition, the five-year bar to eligibility for Medicaid only (including Medicaid expansion programs under SCHIP) does not apply to
No. The five-year bar never applies to immigrants who are applying for treatment of an emergency medical condition only. Thus, all immigrants – both qualified and non-qualified aliens as well those who are residing in the country in an undocumented status – may be eligible for treatment of an emergency medical condition only, provided that they otherwise meet the eligibility criteria for the state’s Medicaid program.
As a general rule, no. It is the date of entry into the United States which determines the operation of the five-year bar. Thus, the five-year bar generally does not apply to immigrants who entered the United States prior to August 22, 1996, but obtained qualified alien status on or after that date. The only exception is for immigrants who did not remain “continuously present” in the United States from their last date of entry into the United States prior to August 22, 1996 until the date they obtain qualified alien status.
Based on interim guidance issued by the U.S. Department of Justice (DOJ), immigrants who entered the country without proper documents as well as those who overstayed their visa are treated the same as those who entered and remain in the country with valid immigration documents. Thus, all immigrants who (1) entered the country prior to August 22, 1996 and (2) remained continuously present in the United States until becoming a qualified alien, are eligible for Medicaid immediately upon obtaining qualified alien status, provided that they otherwise are eligible for coverage under your state plan.
To avoid application of the five-year bar, immigrants who entered the United States before August 22, 1996, but who obtain qualified alien status on or after that date, must remain “continuously present” in the country from their last date of entry into the United States prior to August 22, 1996 until they obtain qualified alien status. Any single absence from the United States of more than 30 days, or a total aggregate of absences of more than 90 days, is considered to interrupt “continuous presence.” Once an immigrant obtains qualified alien status, he or she does not have to remain continuously present in the United States in order to avoid application of the five-year bar.
Immigrants who (1) entered the United States at some point prior to August 22, 1996 and (2) obtained qualified alien status on or after that date, but (3) did not remain continuouslypresent in the United States from their last date of entry into the country prior to August 22, 1996 until they become a qualified alien, are not considered as having entered the United States prior to August 22, 1996. Accordingly, such immigrants are subject to the five-year bar.
If the five-year bar applies–i.e., the immigrant does not meet one of the exemptions discussed above and entered the country on or after August 22, 1996–the clock on the five-year bar begins to run from the date the immigrant obtains qualified alien status.
Note that, once it is determined that the five-year bar applies, the immigrant’s date of entry – whether in a documented or undocumented status – is irrelevant. Thus, unlike the determination of whether or not the five-year bar applies in the first place, the date on which the bar begins to run is not related to the date on which an immigrant first entered the United States.
Depending on the exemption claimed, states will need to follow different verification procedures.
Exemptions based on immigration status. Five of the exemptions from the five-year bar apply to immigrants in a specific immigration status: refugees, asylees, Cuban and Haitian entrants, aliens whose deportation is being withheld and Amerasian immigrants. Immigrants in any of these groups should possess an immigration document establishing their status, which can be verified with the INS in accordance with the procedure generally followed by the state to verify immigration status.
Exemption based on veteran or active duty status. As discussed above, also exempt from the five-year bar are veterans with an honorable discharge and immigrants on active duty as well as the spouse and dependent children of veterans and active duty personnel. Verification of honorable discharge status or active duty requires presentation of an original or notarized copy of the veteran’s discharge certificate or current orders showing “Honorable” discharge from or active duty in the Army, Navy, Air Force, Marine Corps or Coast Guard. Neither discharge “Under Honorable Conditions” nor service in the National Guard satisfies this exemption. States should contact the local Veterans Affairs (VA) regional office if an applicant presents (1) documentation showing honorable discharge from, or active duty in, any other branch of the military; (2) documentation showing any other type of duty (e.g. “active duty for training”) or (3) the state has any other reason to question whether or not an applicant satisfies the require-ments for this exemption.
Exemption for certain Native Americans. For purposes of Medicaid eligibility, American Indians born in Canada to whom §289 of the INA applies and members of a Federally-recognized tribe also are exempt from the five-year bar. Some American Indians born in Canada to whom §289 of the INA applies may have documentation establishing legal permanent residence status, which can be verified in accordance with the procedure generally followed by the state to verify immigration status. Alternatively, an applicant claiming to fall under this exemption could present a letter or other tribal document certifying at least 50% Indian blood, as required by §289 of the INA, combined with a birth certificate or other evidence of birth in Canada.
Applicants can establish membership in a Federally-recognized tribe by presenting a membership card or other tribal document demonstrating membership in an Indian tribe. If the applicant has no documentation, the state can verify membership by contacting the tribe in question.
Victims of Trafficking. The Office of Refugee Resettlement (ORR) of the U.S. Department of Health and Human Services has been given authority to certify that an individual is a victim of a severe form of trafficking. ORR issues a letter to all individuals so certified. Thus, to verify an immigrant’s status as a victim of a severe form of trafficking, so as to establish an exemption from the five-year bar, the immigrant should present a certification letter from ORR. The letter will contain a certification date, which can be treated as the date of entry for eligibility purposes, as well as an expiration date.
States have discretion to establish reasonable verification procedures for determining an immigrant’s date of entry into the United States. However, providing documentation can be difficult for some immigrants – e.g., battered aliens — and we encourage states to design verification processes that can accommodate the difficulty such immigrants may encounter in providing documentation. Following are ways states may be able to verify an immigrant’s date of entry into the United States.
Reliance on Immigrant’s Immigration Document. Most immigrants legally present in the United States must carry an immigration document issued by the Immigration and Naturalization Service (INS), which also generally will contain the date an immigrant entered the country or adjusted to the immigration status reflected by the document. States often will be able to rely upon the date found on the individual’s immigration document to establish the date of entry. Sometimes, however, states will need to pursue additional verification, as discussed below.
As explained in answer to question 4, four groups of immigrants are potentially subject to the five-year bar: (1) certain legal permanent residents (LPRs); (2) aliens granted parole for at least one year; (3) certain battered aliens, as well as the parents and/or child of certain battered aliens; and (4) certain non-citizen Native Americans.
Most LPRs possess INS form I-551 (a “green card”). LPRs who have recently arrived in the United States and who have not yet received their green card will have a temporary I-551 stamp either in their passport or on INS Form I-94. Aliens granted parole for at least one year possess INS Form I-94, which will show the date of entry, a grant of parole under §212(d)(5) of the Immigration and Nationality Act, and a “date admitted to” being at least one year after the date of entry which is stamped on the I-94. (The “date admitted to” refers to the date on which the immigrant’s legal status as a parolee terminates. The immigrant should either have left the country by that date, or have obtained another legal status.)
American Indians to whom §289 of the INA applies may have either a green card with the code S13 or a temporary I-551 stamp in a Canadian passport or on INS Form I-94, but others may not have any immigration documents. Similarly, battered aliens may or may not have a valid immigration document.
For immigrants with valid immigration documents, the date on the immigrant’s immigration document often represents the immigrant’s first date of entry into the United States. In the case of LPRs who obtained such status at the time of their admission into the United States, for example, the date on their green card or on the I-551 stamp in their passport or I-94 usually will reflect their date of entry.
In some cases, however, an immigrant may be present in the United States, but not as an LPR, depart to be issued an immigrant visa at a consulate overseas and then return to the United States in LPR status. For these immigrants, the date on their green card or on the I-551 stamp will reflect the date of entry into the United States in LPR status, not the immigrant’s original date of entry. Similarly, for LPRs who adjusted to LPR status sometime after entering the United States, the date on their green card reflects the date the adjustment of status was approved, not the original date of entry.
For purposes of determining the applicability of the five-year bar, states can assume that the date on the immigrant’s immigration document represents the date of entry if either:
Further verification required. If (1) the individual does not possess an immigration document or (2) the date on the immigrant’s immigration document is on or after August 22, 1996 and the immigrant states that he or she entered the country prior to August 22, 1996, alternative verification is required. States can verify the initial date of entry into the United States by submitting to the Immigration and Naturalization Service INS Form G-845 and Form G-845 Supplement.
States which verify immigration status through use of the INS’ Systematic Alien Verification of Eligibility (SAVE) system as well as those that do not utilize SAVE can file the requisite forms with INS. Alternatively, states can provide immigrants with an opportunity to submit evidence of their claimed date of entry, such as pay stubs, a letter from an employer, or a lease or utility bill in the immigrant’s name.
For most legal entrants, the INS maintains a record of arrivals to and departures from the country. Accordingly, states can verify continuous presence for most legal entrants by filing INS Form G-845 and Form G-845-Supplement with the INS. For some legal entrants, such as Canadian and Mexican border crossers, for whom the INS does not maintain an arrival and departure record, as well as for illegal entrants, states will have to develop an alternative method to verify continuous presence. For example, states could require such immigrants to provide documentation showing proof of continuous presence, such as a letter from an employer or a series of pay stubs or utility bills in the immigrant’s name and spanning the period of time in question.
The answer to this question differs for Medicaid (including Medicaid expansion programs under SCHIP) versus separate child health programs under SCHIP.
Medicaid and Medicaid expansion programs. Under PRWORA, states are required to provide Medicaid to certain qualified aliens who otherwise meet the eligibility criteria of the state’s Medicaid program, unless subject to the five-year bar. The qualified aliens for whom coverage is mandatory include:
In addition, as discussed above, non-citizen Native Americans born outside of the United who either (1) were born in Canada and are at least 50% American Indian blood or (2) are members of a Federally-recognized tribe are eligible for Medicaid regardless of qualified alien status.
Coverage of all other qualified aliens is optional under Medicaid, including Medicaid expansion programs under SCHIP. Note, however, that states must provide Medicaid coverage either to all qualified aliens whose coverage is optional (and who otherwise meet the eligibility criteria of their Medicaid program) or to none; states cannot extend coverage only to some of the optional qualified aliens.
Thus, if a state has opted to cover optional qualified aliens under its Medicaid program, then, following expiration of the five-year bar, the state must extend coverage to any qualified alien who had been subject to that bar. If a state has not opted to extend Medicaid coverage to optional qualified aliens, then, following expiration of the five-year bar, the state must extend coverage to only to qualified aliens for whom coverage is otherwise mandatory.
Separate child health programs under SCHIP. Regulations governing separate child health programs at 42 CFR § 457.320(b)(6) prohibit states from denying eligibility to any child based on citizenship or nationality, to the extent that the child is a U.S. citizen, national or qualified alien. Thus, once the five-year bar expires, states must provide coverage to all otherwise eligible qualified aliens.
| All States (except Alaska & Hawaii) and D.C.
Income Guidelines as Published in the Federal Register on 2/07/03 Annual Guidelines |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Family Size | Percent of Poverty | ||||||||
| 100% | 120% | 133% | 135% | 150% | 175% | 185% | 200% | 250% | |
| 1 | 8,980.00 | 10,776.00 | 11,943.40 | 12,123.00 | 13,470.00 | 15,715.00 | 16,613.00 | 17,960.00 | 22,450.00 |
| 2 | 12,120.00 | 14,544.00 | 16,119.60 | 16,362.00 | 18,180.00 | 21,210.00 | 2,422.00 | 24,240.00 | 30,300.00 |
| 3 | 15,260.00 | 18,312.00 | 20,295.80 | 20,601.00 | 22,890.00 | 26,705.00 | 28,231.00 | 30,520.00 | 38,150.00 |
| 4 | 18,400.00 | 22,080.00 | 24,472.00 | 24,840.00 | 27,600.00 | 32,200.00 | 34,040.00 | 36,800.00 | 46,000.00 |
| 5 | 21,540.00 | 25,848.00 | 28,648.20 | 29,079.00 | 32,310.00 | 37,695.00 | 39,849.00 | 43,080.00 | 53,850.00 |
| 6 | 24,680.00 | 29,616.00 | 32,824.40 | 33,318.00 | 37,020.00 | 43,190.00 | 45,658.00 | 49,360.00 | 61,700.00 |
| 7 | 27,820.00 | 33,384.00 | 37,000.60 | 37,557.00 | 41,730.00 | 48,685.00 | 51,467.00 | 55,640.00 | 69,550.00 |
| 8 | 30,960.00 | 37,152.00 | 41,176.80 | 41,796.00 | 46,440.00 | 54,180.00 | 57,276.00 | 61,920.00 | 77,400.00 |
| For family units of more than 8 members, add $3,140 for each additional member. | |||||||||
| Monthly Guidelines | |||||||||
| 1 | 748.33 | 898.00 | 995.28 | 1,010.25 | 1,122.50 | 1,309.58 | 1,384.42 | 1,496.67 | 1,870.83 |
| 2 | 1,010.00 | 1,212.00 | 1,343.30 | 1,363.50 | 1,515.00 | 1,767.50 | 1,868.50 | 2,020.00 | 2,525.00 |
| 3 | 1,271.67 | 1,526.00 | 1,691.32 | 1,716.75 | 1,907.50 | 2,225.42 | 2,352.58 | 2,543.33 | 3,179.17 |
| 4 | 1,533.33 | 1,840.00 | 2,039.33 | 2,070.00 | 2,300.00 | 2,683.33 | 2,836.67 | 3,066.67 | 3,833.33 |
| 5 | 1,795.00 | 2,154.00 | 2,387.35 | 2,423.25 | 2,692.50 | 3,141.25 | 3,320.75 | 3,590.00 | 4,487.50 |
| 6 | 2,056.67 | 2,468.00 | 2,735.37 | 2,776.50 | 3,085.00 | 3,599.17 | 3,804.83 | 4,113.33 | 5,141.67 |
| 7 | 2,318.33 | 2,782.00 | 3,083.38 | 3,129.75 | 3,477.50 | 4,057.08 | 4,288.92 | 4,636.67 | 5,795.83 |
| 8 | 2,580.00 | 3,096.00 | 3,431.40 | 3,483.00 | 3,870.00 | 4,515.00 | 4,773.00 | 5,160.00 | 6,450.00 |
| 2003 Poverty Level Guidelines Alaska Income Guidelines as Published in the Federal Register on 2/7/03 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Family Size | Percent of Poverty | ||||||||
| 100% | 120% | 133% | 135% | 150% | 175% | 185% | 200% | 250% | |
| 1 | 11,210.00 | 13,452.00 | 14,909.30 | 15,133.50 | 16,815.00 | 19,617.50 | 20,738.50 | 22,420.00 | 28,025.00 |
| 2 | 15,140.00 | 18,168.00 | 20,136.20 | 20,439.00 | 22,710.00 | 26,495.00 | 28,009.00 | 30,280.00 | 37,850.00 |
| 3 | 19,070.00 | 22,884.00 | 25,363.10 | 25,744.50 | 28,605.00 | 33,372.50 | 35,279.50 | 38,140.00 | 47,675.00 |
| 4 | 23,000.00 | 27,600.00 | 30,590.00 | 31,050.00 | 34,500.00 | 40,250.00 | 42,550.00 | 46,000.00 | 57,500.00 |
| 5 | 26,930.00 | 32,316.00 | 35,816.90 | 36,355.50 | 40,395.00 | 47,127.50 | 49,820.50 | 53,860.00 | 67,325.00 |
| 6 | 30,860.00 | 37,032.00 | 41,043.80 | 41,661.00 | 46,290.00 | 54,005.00 | 57,091.00 | 61,720.00 | 77,150.00 |
| 7 | 34,790.00 | 41,748.00 | 46,270.70 | 46,966.50 | 52,185.00 | 60,882.50 | 64,361.50 | 69,580.00 | 86,975.00 |
| 8 | 38,720.00 | 46,464.00 | 51,497.60 | 52,272.00 | 58,080.00 | 67,760.00 | 71,632.00 | 77,440.00 | 96,800.00 |
| For family units of more than 8 members, add $3,610 for each additional member. | |||||||||
| Monthly Guidelines | |||||||||
| 1 | 11,210.00 | 13,452.00 | 14,909.30 | 15,133.50 | 16,815.00 | 19,617.50 | 20,738.50 | 22,420.00 | 28,025.00 |
| 2 | 15,140.00 | 18,168.00 | 20,136.20 | 20,439.00 | 22,710.00 | 26,495.00 | 28,009.00 | 30,280.00 | 37,850.00 |
| 3 | 19,070.00 | 22,884.00 | 25,363.10 | 25,744.50 | 28,605.00 | 33,372.50 | 35,279.50 | 38,140.00 | 47,675.00 |
| 4 | 23,000.00 | 27,600.00 | 30,590.00 | 31,050.00 | 34,500.00 | 40,250.00 | 42,550.00 | 46,000.00 | 57,500.00 |
| 5 | 26,930.00 | 32,316.00 | 35,816.90 | 36,355.50 | 40,395.00 | 47,127.50 | 49,820.50 | 53,860.00 | 67,325.00 |
| 6 | 30,860.00 | 37,032.00 | 41,043.80 | 41,661.00 | 46,290.00 | 54,005.00 | 57,091.00 | 61,720.00 | 77,150.00 |
| 7 | 34,790.00 | 41,748.00 | 46,270.70 | 46,966.50 | 52,185.00 | 60,882.50 | 64,361.50 | 69,580.00 | 86,975.00 |
| 8 | 38,720.00 | 46,464.00 | 51,497.60 | 52,272.00 | 58,080.00 | 67,760.00 | 71,632.00 | 77,440.00 | 96,800.00 |
| 2003 Poverty Level Guidelines Hawaii Income Guidelines as Published in the Federal Register on 2/7/03 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Family Size | Percent of Poverty | ||||||||
| 100% | 120% | 133% | 135% | 150% | 175% | 185% | 200% | 250% | |
| 1 | 10,330.00 | 12,396.00 | 13,738.90 | 13,945.50 | 15,495.00 | 18,077.50 | 19,110.50 | 20,660.00 | 25,825.00 |
| 2 | 13,940.00 | 16,728.00 | 18,540.20 | 18,819.00 | 20,910.00 | 24,395.00 | 25,789.00 | 27,880.00 | 34,850.00 |
| 3 | 17,550.00 | 21,060.00 | 23,341.50 | 23,692.50 | 26,325.00 | 30,712.50 | 32,467.50 | 35,100.00 | 43,875.00 |
| 4 | 21,160.00 | 25,392.00 | 28,142.80 | 28,566.00 | 31,740.00 | 37,030.00 | 39,146.00 | 42,320.00 | 52,900.00 |
| 5 | 24,770.00 | 29,724.00 | 32,944.10 | 33,439.50 | 37,155.00 | 43,347.50 | 45,824.50 | 49,540.00 | 61,925.00 |
| 6 | 28,380.00 | 34,056.00 | 37,745.40 | 38,313.00 | 42,570.00 | 49,665.00 | 52,503.00 | 56,760.00 | 70,950.00 |
| 7 | 31,990.00 | 38,388.00 | 42,546.70 | 43,186.50 | 47,985.00 | 55,982.50 | 59,181.50 | 63,980.00 | 79,975.00 |
| 8 | 35,600.00 | 42,720.00 | 47,348.00 | 48,060.00 | 53,400.00 | 62,300.00 | 65,860.00 | 71,200.00 | 89,000.00 |
| For family units of more than 8 members, add $3,610 for each additional member. | |||||||||
| Monthly Guidelines | |||||||||
| 1 | 860.83 | 1,033.00 | 1,144.91 | 1,162.13 | 1,291.25 | 1,506.46 | 1,592.54 | 1,721.67 | 2,152.08 |
| 2 | 1,161.67 | 1,394.00 | 1,545.02 | 1,568.25 | 1,742.50 | 2,032.92 | 2,149.08 | 2,323.33 | 2,904.17 |
| 3 | 1,462.50 | 1,755.00 | 1,945.13 | 1,974.38 | 2,193.75 | 2,559.38 | 2,705.63 | 2,925.00 | 3,656.25 |
| 4 | 1,763.33 | 2,116.00 | 2,345.23 | 2,380.50 | 2,645.00 | 3,085.83 | 3,262.17 | 3,526.67 | 4,408.33 |
| 5 | 2,064.17 | 2,477.00 | 2,745.34 | 2,786.63 | 3,096.25 | 3,612.29 | 3,818.71 | 4,128.33 | 5,160.42 |
| 6 | 2,365.00 | 2,838.00 | 3,145.45 | 3,192.75 | 3,547.50 | 4,138.75 | 4,375.25 | 4,730.00 | 5,912.50 |
| 7 | 2,665.83 | 3,199.00 | 3,545.56 | 3,598.88 | 3,998.75 | 4,665.21 | 4,931.79 | 5,331.67 | 6,664.58 |
| 8 | 2,966.67 | 3,560.00 | 3,945.67 | 4,005.00 | 4,450.00 | 5,191.67 | 5,488.33 | 5,933.33 | 7,416.67 |