The Timeline Has Changed, But Threats to People with Disabilities in Senate Health Care Reform Efforts Remain

Washington, DC – The Arc released the following statement as Senate Majority Leader Mitch McConnell pulls the Better Care Reconciliation Act, and announces an upcoming vote on a repeal of the Affordable Care Act without an immediate replacement:

“Make no mistake – the Medicaid program and the home and community based supports that people with intellectual and developmental disabilities rely on to live independent lives were on the brink of destruction. As the disability community battled against this effort over the last several months, we have shown our strength, our power, and I thank each and every advocate who has stepped up in this fight.

“This is not over. As Senate Majority Leader McConnell considers his next steps regarding repeal of the Affordable Care Act, we are reminded of the 2015 plan to repeal and not replace the Affordable Care Act. The Congressional Budget Office analysis showed that under that proposal, by 2026, 32 million people would lose health insurance and premiums would double.

“We know there will be further threats in the future, which is why we remain vigilant in our advocacy efforts. Congress is already doubling down on slashing the Medicaid program – today, the House unveiled its budget resolution that includes sweeping changes to Medicaid, Social Security, and Medicare.

“This is going to be a long road, but one that people with disabilities, their family members, support staff, and friends will navigate together. We must unite and reject cuts that will take away the dignity and independence of people with disabilities. This is the civil rights fight of our time, and we will remain vigilant to protect all that has been built to ensure the inclusion and equality of people with intellectual and developmental disabilities in our society,” said Peter Berns, CEO, The Arc.

The Arc Warns that the Senate Republican Health Care Legislation Continues to Pose a Severe Threat to People with Disabilities

by The Arc

Washington, DC – The Arc released the following statement following the release of the updated Senate Republicans’ health care legislation discussion draft:

“A new draft, new talking points, same devastating impact on people with intellectual and developmental disabilities. It is disheartening to know that Senators were in their districts for the last week, yet the pleas of their constituents with disabilities have been ignored with the latest draft of this legislation. This response to the extensive and impressive outreach from the disability community is an insult to people with disabilities and their families.

“The Better Care Reconciliation Act is an assault on people with disabilities and we implore Senators to do the right thing and oppose this bill. A vote in favor of this bill is a vote against the progress of the disability rights movement and constituents who rely on Medicaid for their independence,” said Peter Berns, CEO of The Arc.

On June 22, 2017, the Senate Budget Committee released a discussion draft of health care reform legislation, the “Better Care Reconciliation Act of 2017” (“Senate bill”). The Congressional Budget Office (CBO) released an analysis of the cost of the bill and the impact on health care coverage. CBO found that at least 22 million fewer individuals would have health care coverage by 2026. CBO also found that the Senate bill cuts Medicaid by $772 billion over 10 years, but the most severe cuts do not begin to take effect until 2025. Starting in 2025, the cuts are billions more than the cuts in the House bill and would increase significantly over time. CBO found that, compared to current law, Medicaid would decrease by 35% in 2036.

The current discussion draft from the Senate did include a woefully inadequate home and community based four-year demonstration program for rural states.  A total of $8 billion is available over four years.  In contrast, the discussion draft retains the $19 billion dollar cut made to the Community First Choice Option which is a program available to any state that chooses the option with no end date.
The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

Join us at the 2017 Back To School Carnival on Saturday, August 5th

Join us at the Back to School Carnival!  This event is free and open to the public!

The Lyric Theatre hosts the 2017 Back To School Carnival on Saturday, August 5 11AM – 3PM. Come to The Lyric to celebrate the start of the 2017-2018 Fayette County Public School Year and enjoy games and activities.  Free school supplies and popcorn!

Date: Saturday, August 5, 2017

Time:  11:00am to 3:00pm

Location:  The Lyric Theatre & Cultural Center, 300 East Third Street, Lexington, KY

Website:  http://www.lexingtonlyric.com/event.php?id=960

SSI Makes Allowances for Student Finances

by The Arc

By Mary L. Waltari, Esq., Special Needs Alliance

Students with disabilities and their families sometimes worry that the very process of becoming educated—with an important goal being increased economic independence—can reduce SSI (Supplemental Security Income). Probably not. The Social Security Administration wants to encourage self-sufficiency and has guidelines that, in many cases, will enable individuals receiving SSI to continue their education without diminishing monthly payments.

SSI is a monthly cash payment made to eligible individuals with disabilities and, in many cases, it’s fundamental to their financial security. It’s a means-tested benefit, and until a child reaches the age of 18, parental income and assets are evaluated when determining qualification. Since an individual may not have more than $2,000 in “countable assets,” most minors are ineligible. However, once they reach 18, family assets are no longer considered, and many individuals with disabilities begin receiving SSI at that point. At the same time, many of them continue with high school education until the age of 21. Upon graduation, they may attend vocational training or college. While doing so, they may work a part-time job or receive financial aid, including room and board.

Protected Savings

Special needs trusts (SNTs), ABLE accounts and Social Security’s PASS (Plan to Achieve Self-Support) are several ways to set aside money for education, among other things. While these savings tools are regulated differently from one another, they enable funds for eligible individuals with disabilities to be accumulated without affecting means-tested government programs.

Monthly Earnings

Student Earned Income Exclusions (SEIE) take summer or part-time jobs into account by disregarding more income for students than for non-students. To be eligible, individuals must be under 22 and “regularly attending school,” which generally means going to classes for at least one month during the quarter to which SEIE applies for at least:

  • 12 hours weekly for high school students;
  • 12 hours weekly for vocational training;
  • eight hours weekly for college students

There are exceptions for illness, and different rules apply to home schooling and “homebound” students.

It’s useful to compare SSI guidelines for students with those applied to others:

  • Non-Students: SSI doesn’t count the first $65 of monthly earnings and half of the remainder, along with a $20 general income exclusion. What’s left reduces SSI dollar-for-dollar.
  • Students: SSI disregards the first $1,790 of monthly earnings, up to an annual total of $7,200. Earnings over $1,790 per month will then receive the same earned income exclusion and general income exclusion available for non-students, after which earnings reduce SSI dollar-for-dollar.

Financial Aid

Any financial assistance covered by Title IV of the Higher Education Act of 1965 or Bureau of Indian Affairs programs isn’t counted as income, regardless of use. Interest and dividends from unspent funds are also exempt. Pell Grants, Federal Work-Study and Direct Loans are just a few of the covered programs.

But it does matter when and how financial aid and gifts from other sources are spent:

  • There’s no effect on SSI so long as funds are spent on education-related needs within nine months of receipt.
  • Funds set aside for education purposes but ultimately used differently are counted as income at the earlier of two points: in the month they’re spent or the month the individual no longer intends to use the funds for educational purposes
  • Funds that are neither set aside for education nor immediately spent for that purpose are counted as income during the month of receipt and counted as a resource the next month.

Student Housing

Since SSI is intended to pay for food and shelter, non-students have their payments reduced when they receive such in-kind support and maintenance (ISM) from other sources. In such cases, SSI may be cut back by up to one-third of the maximum federal SSI monthly benefit, plus $20.

But if a student receiving SSI resides on campus, with room and board covered by parents or financial aid, other rules apply. The school living arrangements will be considered temporary and not categorized as ISM if:

  • the individual is over 18;
  • will return to their permanent address during holidays, vacations or following graduation;
  • and lived at their permanent address for at least one calendar month prior to attending school.

On the other hand, if the student receives free housing and meals at their permanent residence, ISM applies and SSI will be reduced.

The Social Security Administration recognizes that education can be a gateway to independence for individuals with disabilities. Paying attention to these guidelines can ensure that students aren’t financially penalized for their ambitions.

Mary L. Waltari is a member of the Special Needs Alliance, a national nonprofit dedicated to assisting individuals with disabilities, their families and the professionals who serve them. SNA is partnering with The Arc to provide educational resources, build public awareness and advocate for policies on behalf of people with intellectual/developmental disabilities and their families.

The Arc Responds to Delayed Vote on Senate Health Care Bill That Showed Dangerous Disregard for People with Disabilities

by The Arc

Washington, DC – The Arc released the following statement in response to the Senate delaying the vote on the Better Care Reconciliation Act:

“We are pleased that the Senate is delaying its vote on this dangerous piece of legislation, but we remain vigilant in our opposition to this bill. We commend the Members of Congress who stood up for the rights of their constituents with intellectual and developmental disabilities by opposing the Better Care Reconciliation Act over the last few days. This bill showed a dangerous disregard for the well-being of people with disabilities and those with complex medical needs.

“I want to warn advocates that this is a delay, not a defeat of this threat. The bill is still an assault on the rights of people with disabilities. Any Senator supporting this travesty of a bill will be accountable for the negative impact on their constituents and the irrevocable damage it will do to our community based services system. A vote in favor of this bill is a vote in favor of cutting health care coverage from at least 22 million individuals by 2026. Per the budget report, by next year, 15 million more people would be uninsured compared with current law.

“We will continue our efforts to change the hearts and minds of those who supported this bill and help them understand that their constituents rely on Medicaid for comprehensive health care coverage and long term services and supports that enable them to live full lives in the community. Those are the Senators we need to reach; we need them to realize what is at stake.  Our work is far from over, we will continue to work tirelessly in opposition to this bill. We encourage members of our network to share their stories with their Senators during the upcoming recess,” said Peter Berns, CEO of The Arc.

The Arc advocates for and serves people wit­­h intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

Changes Coming to Waiver Programs in Kentucky

Commonwealth of Kentucky Cabinet for Health and Family Services Department for Medicaid Services

Public Notice of the 1915(c) Assessment Project Notice: Department of Medicaid 1915(c) Assessment Project, Public Notice

The Kentucky Cabinet for Health and Family Services (CHFS) has hired Navigant Consulting. Together they will review Kentucky’s six home- and community-based waiver programs:

• Acquired Brain Injury Waiver
• Acquired Brain Injury Long-Term Care Waiver
• Home and Community Based Waiver
• Michelle P. Waiver
• Model II Waiver
• Supports for Community Living Waiver

The goal of this project is to make these waiver programs better. Three departments in the Cabinet are working together on this project – Medicaid, the Department for Aging and Independent Living (DAIL) and the Department for Behavioral Health, Developmental and Intellectual Disabilities (DBHDID). The project will be completed in two parts. Part One is to review each program and make plans for how to improve the programs. Part Two will be to put the plans into place. Please note: The Cabinet has extended the deadline for Part One of the project. It was June 30th, 2017 but has been moved to a later date. We will let the public know when a new deadline is set.

The Cabinet knows these programs are very important. We will tell you what the project is about. We also want to hear from the people who use these programs. We will give regular updates. We would like to include everyone involved in the programs – people on the waivers, their families, and the providers who deliver services. Our meetings will be open to anyone who wants to learn more.

Our first public meeting will be later this month. We will hold two sessions of the meeting:

• June 22, 2017 from 9-10am
• June 22, 2017 from 1-2pm

Meetings will be held at the Kentucky Transportation Cabinet Conference Center, which is at 200 Mero Street C101, Frankfort, KY 40622. You can join the meeting in person or by webinar.

During these sessions, we will talk about how we plan to do this work. We will also introduce the team working on the project. We will have comment cards at the meetings. You can share ideas or concerns on those comment cards.

For questions, or requests for accommodation due to a disability, please email Lori.Gresham@ky.gov.Thank you for your interest and support.

Medicaid Helps Schools Help Children

Medicaid provides affordable and comprehensive health coverage to over 30 million children, improving their health and their families’ financial well-being.[1] In addition to the immediate health and financial benefits that Medicaid provides, children covered by Medicaid experience long-term health and economic gains as adults.[2] Many children receive Medicaid-covered health care not only at the doctor’s office, but also often at school.

For students with disabilities, schools must provide medical services that are necessary for them to get an education as part of their special education plans, and Medicaid pays for these services for eligible children. And Medicaid’s role in schools goes beyond special education, as it also pays for health services that all children need, such as vision and dental screenings, when they are provided in schools to Medicaid-eligible children. Schools can also help enroll eligible but unenrolled children in Medicaid or the Children’s Health Insurance Program (CHIP), and connect them to other health care services and providers. Medicaid also helps schools by reducing special education and other health care-related costs, freeing up funding in state and school budgets to help advance other education initiatives.

Capping and cutting federal Medicaid funding would jeopardize critical health-related services for students.Capping and cutting federal Medicaid funding, as the House Republicans’ American Health Care Act would do, would jeopardize critical health-related services for students and put an important source of funds for schools and states at risk.

Leveraging Medicaid for Special Education

The Individuals with Disabilities Education Act (IDEA) ensures that children with disabilities have access to public education in the least restrictive environment based on their individual needs. Under the IDEA, children’s needs are identified in an individualized education plan (IEP), which details the education and related services they need. In many cases the IEP includes services that Medicaid covers for children, such as physical and speech therapy.[3]

Unlike Medicaid, funding for IDEA is appropriated annually and at insufficient levels. Although the federal government committed in IDEA to provide 40 percent of the cost to educate children with disabilities, it has never met even half of that commitment. For example, in 2015, federal IDEA funding covered only 16 percent of the cost to educate children with disabilities, leaving the remaining costs to states and local governments. Since 2009, this cost shift has averaged about $17 billion each year.[4]

Despite the lack of adequate federal funding, IDEA requires local education agencies to prioritize the educational needs of students with disabilities. Without another source of revenue, states and schools must offset the additional costs associated with special education using general education dollars. Medicaid helps fill this gap by providing reimbursement for health care services that are necessary for students with disabilities to succeed in school when the following conditions are met: the services are listed in the child’s IEP; the child is enrolled in Medicaid; Medicaid covers the service; and the school is recognized as a Medicaid provider. Schools’ ability to leverage Medicaid funding ensures that they can provide the wide range of services needed to educate students with disabilities and ensure their compliance with IDEA requirements.

Helping Kids Stay Healthy and Succeed Academically

Medicaid coverage has a significant positive impact not only on children’s health, but also on their educational attainment and job earnings. Children covered by Medicaid during their childhood have better health as adults, with fewer hospitalizations and emergency room visits, research shows.[5] Moreover, children covered by Medicaid are more likely to graduate from high school and college and have higher wages and pay more in taxes as adults.[6] (See Figure 1.)

Medicaid’s role in schools goes beyond ensuring that students with disabilities have access to the medical services they need to succeed. Medicaid provides support for health care services delivered in school, which benefit all children — not just those enrolled in Medicaid. In a recent survey of school superintendents, almost half reported that they use the reimbursement their districts receive for services provided to Medicaid-eligible children to expand health-related services and supplies.[7] This includes programs that monitor the health care needs of eligible children with certain conditions such as asthma and diabetes as well as operating clinics within schools to provide dental care to Medicaid-eligible children.

Medicaid pays for services and supplies provided to Medicaid-eligible children under its Early Periodic Screening Diagnostic and Treatment (EPSDT) benefit. Under this benefit, children and adolescents under the age of 21 have guaranteed access to a robust set of comprehensive and preventive health services, including regular well-child exams; hearing, vision, and dental screenings; and other services to treat physical, mental, and developmental illnesses and disabilities. The EPSDT benefit also covers medically necessary supplies and equipment that help students in schools, such as hearing aids, eyeglasses, wheelchairs, and other assistive technology to help students hear and see.

Connecting Kids to Coverage

Schools serve as an important pathway to coverage for low-income children by helping their families enroll them in Medicaid and CHIP. Schools are natural places to help enroll uninsured children: they’re an easy place to identify uninsured children; they’re trusted places; they’re geographically accessible; they have experience communicating with their communities through established information-sharing methods; and they can collaborate with partners to assist in helping children and their families apply for coverage.[8]

Over half of surveyed school superintendents reported that they had taken steps to increase Medicaid enrollment of children in their schools.[9] Medicaid reimburses schools for their outreach and enrollment activities, which helps both students and schools. Children gain coverage, which helps them stay healthy and succeed in school, and Medicaid reimbursement allows schools to expand health care services and programs.

In addition to using Medicaid to cover costs of outreach and enrollment activities, schools use the program to help connect children to services they need outside school. Forty percent of surveyed school superintendents reported that they use Medicaid funding to facilitate outreach and coordination services to refer children to such services, including mental health services and food assistance.[10]

Cutting Medicaid Would Harm Kids, Local Communities, and State Budgets

In 2015, Medicaid paid for nearly $4 billion in school-based health care services, including both special education and EPSDT services provided outside of special education.[11] (See Appendix Table 1 for state-by-state data.) By comparison, schools received about $12 billion in federal IDEA funding in 2015.[12]

While Medicaid spending on school-based health services represents less than 1 percent of total Medicaid spending, it’s significant for schools. Cutting federal Medicaid funding would reduce the access and quality of care provided to students while also hurting school budgets.

The House Republicans’ bill to repeal the Affordable Care Act, the American Health Care Act (AHCA), would cut federal Medicaid spending by $839 billion over ten years. The AHCA would not only effectively end the Affordable Care Act’s Medicaid expansion but also radically change Medicaid’s financing structure by capping and cutting federal funding by requiring states to choose between a per capita cap or a block grant.[13] That would shift significant costs and risks to states, with the cuts growing larger over time. To compensate, states would have to increasingly cut Medicaid eligibility, benefits, and provider payments. Given the magnitude of the federal cuts, states would likely have to cut funding for Medicaid services provided in schools, which means schools would find it difficult to maintain their current level of special education and health care spending.

Moreover, in states that opted for a block grant, children would likely be left with few federal protections related to their Medicaid coverage because states would no longer have to comply with most federal Medicaid requirements. That would, for example, allow states to no longer cover the guaranteed benefits children receive under EPSDT.

Radically restructuring and cutting Medicaid funding — whether through a per capita cap or a block grant — would thus jeopardize schools’ ability to purchase needed medical equipment, connect children to other health care services, and implement health monitoring programs that benefit the entire school population by keeping all children, not just those enrolled in Medicaid, healthy and successful in school.

In addition to reimbursing schools for direct medical care they provide to eligible students, Medicaid funding helps schools pay the salaries of their health care and ancillary staff who provide important services and support to many students, not just those with Medicaid coverage. In 2017, 68 percent of school superintendents reported that they used Medicaid funding to keep school nurses, school counselors, speech therapists, and other health professionals on staff.[14] Any cuts to Medicaid could jeopardize the benefits these health care professionals provide. Moreover, because school districts are often large employers, Medicaid plays an important role in creating and sustaining jobs in local communities. Radical changes to Medicaid financing could lead schools to layoff school personnel whose salaries are paid by Medicaid.

State education budgets benefit from Medicaid, too. By leveraging Medicaid and federal IDEA funding, states are less likely to have to use general education dollars to pay special education costs. Because IDEA requires school districts to prioritize funding special education, schools would have to shift resources, such as diverting funds from general education or other important areas of the state budget, to absorb a Medicaid funding cut under a per capita cap or block grant. A resulting cut in general education funding could impede states’ ability to help schools implement proven reforms such as hiring and retaining excellent teachers, reducing class sizes, and expanding the availability of high-quality early education — keys to helping children thrive in school.

Appendix

TABLE 1
Medicaid Spending in Schools
State Total Federal
Alabama $34,562,110 $17,281,056
Alaska $4,384,800 $2,192,400
Arizona $42,733,682 $27,049,503
Arkansas $58,648,205 $36,769,009
California $180,286,733 $90,147,654
Colorado $65,214,047 $32,945,196
Connecticut $83,677,404 $41,838,703
Delaware $8,528,600 $4,626,906
Dist. Of Col.* $(8,236,489) $(5,765,430)
Florida $124,715,692 $63,206,315
Georgia $52,097,071 $30,932,107
Hawaii** $0 $0
Idaho $35,770,614 $25,665,305
Illinois $286,388,260 $144,391,000
Indiana $15,939,697 $9,473,111
Iowa $102,106,503 $56,708,832
Kansas $67,095,810 $36,959,435
Kentucky $34,518,428 $20,872,855
Louisiana** $0 $0
Maine $42,800,723 $26,484,778
Maryland $78,895,689 $39,503,532
Massachusetts $146,998,191 $73,506,866
Michigan $250,237,503 $162,144,442
Minnesota $106,433,753 $53,210,621
Mississippi $8,335,706 $4,556,343
Missouri $39,847,998 $19,924,000
Montana $55,034,916 $35,666,244
Nebraska $26,207,529 $13,303,816
Nevada $15,784,497 $10,158,902
New Hampshire $52,973,368 $26,531,270
New Jersey $286,660,460 $143,432,313
New Mexico $30,483,045 $18,044,216
New York $273,563,018 $136,781,511
North Carolina $142,001,148 $87,216,152
North Dakota $1,851,975 $925,971
Ohio $81,546,862 $51,023,143
Oklahoma $2,739,518 $1,706,720
Oregon $5,188,389 $3,300,296
Pennsylvania $253,324,530 $131,095,440
Rhode Island $64,900,209 $32,464,511
South Carolina $33,630,157 $21,429,977
South Dakota $9,661,644 $4,881,539
Tennessee** $0 $0
Texas $444,382,561 $250,343,667
Utah $32,284,475 $21,801,456
Vermont $8,558 $4,810
Virginia $58,719,643 $29,359,835
Washington $9,321,688 $4,664,392
West Virginia $24,694,593 $17,621,320
Wisconsin $187,671,697 $107,416,062
Wyoming** $0 $0
Total $3,954,615,210 $2,163,798,102

Note: The data in this table represent expenditures for school-based services, which can be adjusted and may not include all health care services provided at schools as they may be claimed under a different service type.

*The District of Columbia’s negative balance most likely represents a repayment of a prior year’s school based services expenditures.  In federal fiscal year 2014, the District claimed $5,443,330 in total school-based services, with the federal share equaling $3,810,382.

**In Hawaii, Louisiana, Tennessee, and Wyoming, school-based service expenditures may be reflected in other health service line items on the CMS-64 or could be included in managed care capitation payments.

Source: CMS-64 data compilation

End Notes

[1] Kaiser Family Foundation, “Insurance Coverage of Children 0-18 in 2015,” http://kff.org/other/state-indicator/children-0-18/?dataView=1&currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D.

[2] Sarah Cohodes et al., “The Effect of Child Health Insurance Access on Schooling: Evidence from Public Insurance Expansions,” October 2014, http://www.nber.org/papers/w20178.pdf; David Brown, Amanda Kowalski, and Ithai Lurie, “Medicaid as an Investment in Children: What is the Long-Term Impact on Tax Receipts?” January 2015, http://www.nber.org/papers/w20835.pdf.

[3] Centers for Medicare & Medicaid Services, “Medicaid and School Health: A Technical Assistance Guide,” August 1997, https://www.medicaid.gov/medicaid/financing-and-reimbursement/downloads/school_based_user_guide.pdf

[4] National Education Association, “IDEA Funding Gap,” February 2, 2015, https://www.nea.org/assets/docs/IDEA-Funding-Gap-FY_2015-with-State-Table.pdf.

[5] Laura Wherry et al., “Childhood Medicaid Coverage and Later Life Health Care Utilization,” February 2015, http://www.nber.org/papers/w20929.pdf.

[6] Cohodes et al., op cit.; Brown, Kowalski, and Lurie, op cit.

[7] Sasha Pudelski, “Cutting Medicaid: A Prescription to Hurt the Neediest Kids,” AASA, the School Superintendents Association, January 2017, http://aasa.org/uploadedFiles/Policy_and_Advocacy/Resources/medicaid.pdf.

[8] Shelby Gonzales and Jodi Kwarciany, “Guide to School-Based Outreach for Health Coverage Enrollment,” Center on Budget and Policy Priorities, August 3, 2016, http://www.cbpp.org/sites/default/files/atoms/files/8-3-16health.pdf.

[9] Pudelski, op cit.

[10]Ibid.

[11] Centers for Medicare & Medicaid Services, 2015 MBES Expenditures, https://www.medicaid.gov/medicaid/financing-and-reimbursement/state-expenditure-reporting/expenditure-reports/index.html.

[12] Department of Education, 2015 Congressional Action Table, https://www2.ed.gov/about/overview/budget/budget15/15action.pdf.

[13] For more on per capita caps, see Edwin Park, “Medicaid Per Capita Cap Would Shift Costs and Risks to States and Harm Millions of Beneficiaries,” Center on Budget and Policy Priorities, revised February 27, 2017, http://www.cbpp.org/research/health/medicaid-per-capita-cap-would-shift-costs-and-risks-to-states-and-harm-millions-of.  For more on block grants, see Edwin Park, “Medicaid Block Grant Would Slash Federal Funding, Shift Costs to States, and Leave Millions More Uninsured,” Center on Budget and Policy Priorities, November 30, 2016,  http://www.cbpp.org/research/health/medicaid-block-grant-would-slash-federal-funding-shift-costs-to-states-and-leave.

[14] Pudelski, op cit.

 

“Don’t Take Away Javi’s Chance at a Future”: Watch a Parent’s Plea to Eliminate Proposed Medicaid Cuts

by The Arc

WASHINGTON, DC – Today, The Arc released a video which highlights how the House-passed cut to Medicaid funding negatively impact people with disabilities’ ability to live independently. The video features a conversation with Linda and her son, Javi, from Chapel Hill, North Carolina. Javi has autism and Ehlers-Danlos syndrome, a condition that affects connective tissues in the body and causes joint dislocations, bleeding, pain and fatigue. He has had multiple painful surgeries over the past decade and requires medication and other therapies to live independently. Due to his Medicaid-funded medical treatment and supports, Javi was able to attend college and graduate with skills that he can take into the workforce. If federal Medicaid funding is cut, Javi risks losing the supports he needs to be able to work in the community and live at home.

Recently, the House of Representatives passed the American Health Care Act (AHCA), which included over $800 billion in cuts over 10 years to federal funding for Medicaid programs. The Arc is launching this video amidst negotiations in the Senate on this bill, and on the heels of the Trump Administration releasing its first budget proposal with includes an additional $610 billion in cuts to Medicaid.

The AHCA cut would not only force states to cut eligibility for state Medicaid programs, but will also diminish the quality and quantity of services that are provided to people who are already enrolled in these programs. For many people with intellectual and developmental disabilities, Medicaid generally is the only source of funds for them to live and work in the community with friends and families and avoid costly, harmful, and segregated institutions.

“I lay awake at night worrying. Without Medicaid, I don’t even see a future (for Javi),” says Linda in the video. “If I were to say one thing to the President and Congress I would say: Don’t take away Javi’s chance at a future.”

“Javi is living a life of his choosing, contributing to his community and thriving. These drastic cuts to Medicaid could take it all away from Javi and the millions of other people with disabilities who rely on daily supports and services to be in the community. The AHCA takes away independence, dignity, and decades of progress. We must now rely on the Senate stop this catastrophe,” said Marty Ford, Senior Executive Officer, The Arc.

This video is the fifth in a series of videos The Arc is releasing, sharing the personal stories of people with disabilities and their families, and the impact of the Affordable Care Act (ACA) and Medicaid on their lives.

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.

Owning a Home with a Special Needs Trust

by The Arc

By Amy R. Tripp, Esq., Special Needs Alliance

To say that adequate housing options for persons with disabilities is a challenge is an understatement. As a result, in the process of future planning, housing is almost always one of the most important topics. Some people with disabilities would like to continue living in the family home, with appropriate supports, after Mom and Dad are gone, and parents often agree that would best serve their son or daughter’s interest. Other parents anticipate leaving funds that would allow their son or daughter to own appropriate alternate housing. In both cases, it must be determined if it makes sense for the house to be owned by a special needs trust (SNT) that is likely at the center of their plan. And as noted below, individuals and families must also weigh the benefits of home ownership versus renting to determine the best fit.

The short answer is that, in many cases, is does make sense for an SNT to own a home, but there are numerous considerations and caveats that come into play. This is an overview of the rules and issues that can arise when an SNT owns a home.

It is important first to identify what type of trust would own the home. We should distinguish between “first party” and “third party” trusts. A first party SNT is funded with the individual beneficiary’s assets and, after the death of the beneficiary, requires reimbursement to the state for Medicaid services. A third party SNT, which is funded with someone else’s assets, such as an inheritance from a parent or proceeds from a life insurance policy, is more flexible and does not require reimbursement to the state.

Options for Titling Homes

A threshold consideration in deciding whether a residence is better owned by an SNT or the individual is whether that person has legal capacity to hold title on their own and what decision-making supports the person might need. Minors simply cannot hold title and would require a guardian (in some states, a conservator) be appointed. Many adults may also need support to manage home ownership. If an adult is under guardianship or conservatorship, the guardian or conservator would likely have legal authority to manage the property. Many other adults with I/DD would benefit from using decision-making supporters to help them meet the obligations of home ownership.

For an adult with I/DD, home ownership can be empowering, as it is for all of us. The responsibilities of home ownership, as well as the status of a property owner, can have very positive impact. Families should take care to ensure that appropriate decision-making supports are in place.

If direct ownership isn’t practical, leaving a family home to a third party SNT, or buying one with trust assets, protects the property from creditors and leaves financial and maintenance issues in the hands of a trustee.

While a residence purchased by a first party SNT gains these advantages during the beneficiary’s lifetime, the home is subject to recovery by the state upon the beneficiary’s death to the extent of the costs paid by Medicaid.

Finally, it is important to look at who else might be living in the home. If the home is owned outright by a first party SNT, there may be complications if other family members also reside there. Distributions from first party SNTs are supposed to be for the sole benefit of the beneficiary, and this may be interpreted differently by various Social Security offices. Depending on the level of caregiving performed by family members, they may be required to pay rent in order to avoid affecting the beneficiary’s eligibility for government benefits. There may even be issues regarding what maintenance the trust should pay for.

Some trustees, seeking to avoid a first party trust payback, arrange for the SNT to purchase a life estate interest in the family residence. By paying a portion of the home’s value, the beneficiary has a right to live there, rent free, as long as he or she lives. In some states, however, this won’t avoid the Medicaid lien, and other family members residing in the home still may need to pay rent to avoid conflict with the sole benefit rule.

Running the Numbers

Of course, as attractive as the idea is, whether it is practical to plan to provide a house to an adult son or daughter with disabilities after you’re gone comes down to dollars.

Any time the purchase or transfer of ownership of a residence is begin considered, it is critical to prepare a detailed budget which takes into consideration things such as the cost of modifications needed for accessibility, long-term maintenance, utilities, taxes, insurance, and general upkeep. A common planning mistake is for people to create SNTs which purchase homes, only to have the housing costs consume such a large part of the available resources that other important purposes of the SNT are compromised, leading to deterioration of the property and forcing sale at a discounted price.

On occasion the solution may be as simple as finding a roommate. The trend today is for families to consolidate resources and purchase housing that provides for more than one adult. While there are some great examples of these types of arrangements, there are also many situations in which such plans simply don’t work. And many trustees are unwilling to deal with their complexity.

Beyond the numbers, persons with disabilities and their families should consider other pros and cons to homeownership, including whether the person may in the future want to live in a different neighborhood or area, the suitability of the home for future family configurations and the potential for aging in place.

Effect on Benefits

The ownership of property and the payment of housing expenses can impact the government benefits the individual may be receiving, including Supplemental Security Income (SSI) and Medicaid.

Notably, for persons who receive SSI, mortgage payments, property taxes, utilities and other housing costs paid on their behalf by an SNT are considered in-kind support and maintenance (ISM) and will reduce SSI. Good planning can often reduce the impact of these rules, but not always.

Likewise, depending on how a home is titled, the purchase or sale of a home can trigger interruptions or reductions in benefits in the months in which these events occur. While the home is an exempt asset for SSI and Medicaid benefits, the sale of the home in the future, if titled to the individual, will result in converting an exempt asset into countable resources. If the home is titled to the SNT, then the sale of the home would have no impact on eligibility.

Medicaid liens and other estate recovery claims are potential pitfalls when persons receiving benefits own their own homes, or have homes held in some SNTs. When a first party SNT owns the home, extra attention needs to be provided if other family members are living in the home and providing support to the beneficiary. When the beneficiary dies, Medicaid is reimbursed from the remaining assets in the first party SNT. If the Medicaid lien exceeds the balance of the assets in the first party SNT and the house is owned by the SNT, then the house may be lost. This can be a great hardship for some families who provide support and services to the beneficiary.

Conclusion

Housing is always a challenge in future planning for persons with disabilities. Arranging for a stable living environment is a high priority, but the considerations are many and complex, and families and their counselors are becoming increasingly creative as they struggle with the housing shortage. Whether an SNT can or should own a house involves a number of considerations, and families should seek advice from a qualified attorney to ensure that their objectives are met.

Amy Tripp is a member of the Special Needs Alliance, a national nonprofit dedicated to assisting individuals with disabilities, their families and the professionals who serve them. SNA is partnering with The Arc to provide educational resources, build public awareness and advocate for policies on behalf of people with intellectual/developmental disabilities and their families.

Trump Budget and Health Care Cuts are Devastating for People with Disabilities

by The Arc

WASHINGTON, DC – Today the Trump Administration released its first ten year budget proposal, and the numbers are devastating for people with intellectual and developmental disabilities (I/DD) and their families. On top of the more than $800 billion in Medicaid cuts already approved by the House of Representatives, the Trump Administration is planning for $610 billion in cuts to Medicaid; $72.4 billion in cuts to Social Security’s disability programs; and hundreds of billions more in cuts to other effective federal programs that are vital to people with I/DD.

“Where we invest our federal dollars is a measure of our values as a nation. Today the Trump Administration showed its cards, and coupled with the devastating Medicaid cuts already approved by the House of Representatives in the health care bill, the deck is stacked against people with disabilities.

“In the last few weeks, I’ve traveled to chapters of The Arc in Maryland, North Carolina, Wisconsin, and even Alaska. Chapters of The Arc sprang up in these communities and across the country decades ago because people with disabilities and their families were appalled by the segregation of people with disabilities in inhumane institutions, and they were determined to make progress. And we have fought for rights, closed institutions, opened up the community and classroom, and paved the way to employment. Two effective programs built on bipartisan policy over the years – Medicaid and Social Security – have been essential to this progress. Medicaid provides health care and long term supports that help make a life in the community possible for many people with disabilities, and Social Security is far too often the only thing keeping the lights on and food on the table for a person with a disability.

“That these proposed cuts come in the very same package that is proposing the largest tax cuts in our nation’s history is simply obscene. Giving $5 trillion in tax cuts that primarily benefit wealthy individuals and corporations while simultaneously threatening the lives of everyday people defies comprehension.

“This budget – this Trump card – along with the health care cards being played in Congress as we speak, will dismantle decades of progress for people with disabilities and their families. So I’m calling on all advocates to do what they have done for decades, band together to put a face on these cuts. Share your story in your community and with your elected officials, and tell them to reject these cuts, before we go back in time to an era of discrimination and isolation,” said Peter Berns, CEO, The Arc.

In tandem with this budget news, The Arc is releasing a video which shares the story of a Maryland family which risks losing access to critical care for one of their children due to impending cuts to federal Medicaid funding. The video features Soojung, whose 11-year old daughter Alice, has Rett Syndrome and relies on overnight nursing services to be able to live at home with her family. Soojung speaks about the challenges she and her husband faced accessing these services, including having their requests turned down by private insurers. After years of waiting and uncertainty, Alice was finally accepted to a Medicaid program that provides her with nightly nursing services. These services have led to a great improvement in Alice’s health, making 2016 the first year of her life without a hospital stay.

For many families like Soojung’s, their health and lives could dramatically worsen if the Trump Administration’s proposed Medicaid cuts became a reality or if the over $800 billion in cuts over 10 years to federal Medicaid funding, proposed in the House-approved American Health Care Act (AHCA), go into effect. These cuts would not only force states to cut eligibility for their Medicaid programs, but would also diminish the quality and quantity of services that are provided to people who are already enrolled in these programs.

This video is the fifth in a series of videos The Arc is releasing, sharing the personal stories of people with disabilities and their families, and the impact of the Affordable Care Act (ACA) and Medicaid on their lives.

o   Meet Bryan

o   Meet Thelma

o   Calvin’s Story

o   If I could say one thing

 

The Arc advocates for and serves people with intellectual and developmental disabilities (I/DD), including Down syndrome, autism, Fetal Alcohol Spectrum Disorders, cerebral palsy and other diagnoses. The Arc has a network of over 650 chapters across the country promoting and protecting the human rights of people with I/DD and actively supporting their full inclusion and participation in the community throughout their lifetimes and without regard to diagnosis.