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Vol. 6, No. 5 Fall 1998 |
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Medicaid Is Becoming More "Consumer-Friendly"
by Brian J. Hartman, Esq., Project Director, Disabilities Law Program
Recent developments in both Federal and State Medicaid programs hold great promise for consumers seeking assistive technology ("AT"). With over 80,000 persons in Delaware enrolled in the Medicaid program, including 41,000 children, any shift in policy has a dramatic impact on access to covered services. This article will examine four recent Medicaid initiatives:
- publication of a national policy letter on community-based services;
- adoption of a civil rights policy statement;
- elimination of a restrictive Medicaid regulation; and
- issuance of a policy letter on denial codes.
National Policy Letter on Community-based Services
On the eighth anniversary of the enactment of the Americans with Disabilities Act ("ADA"), President Clinton announced publication of an important policy letter. On July 29, the Health Care Financing Administration ("HCFA") released a policy statement addressed to all state Medicaid directors. 1 The statement merits deference since HCFA is the Federal agency which issues Medicaid regulations and establishes policy. The statement endorses three Federal appeals court decisions. 2
In Helen L., a Pennsylvania Medicaid nursing home resident wished to return home with supportive services. The home-based program cost less than the nursing home placement. However, since funding for the discrete community-based program was lacking, the State determined that the consumer should remain in the nursing home. A Federal appeals court held that the State's refusal to provide Medicaid services in the "most integrated setting" within its existing system violated the ADA.
In Easley, the Pennsylvania Medicaid agency excluded applicants with disabilities from an attendant care program based on a State requirement that enrollees be "mentally alert." A Federal appeals court upheld the requirement, concluding that the program goal of promoting independence would be undermined by inclusion of individuals who could not control their affairs.
In L.C., patients in a state psychiatric hospital in Georgia sought community-based treatment. A Federal appeals court held that unnecessary institutionalization may violate the ADA and that community-based programs may be an appropriate accommodation for some individuals even if such programs are more costly.
Consistent with this caselaw, the policy letter encourages states to promote independence and community-based services. On a practical level, the letter supports consumers seeking Medicaid-funded AT to maximize independent living. For example, a power wheelchair, rather than a manual chair, may be justified based on increased access to more distant community destinations (e.g., stores, library, and public buildings). Alternatively, a lightweight, portable augmentative communication device, rather than a traditional, less mobile model may be justified to enhance community-based use.
Civil Rights Compliance Policy Statement
Apart from the above policy letter, HCFA also published a "Civil Rights Compliance Policy Statement." 3
This statement, published on August 3, promises across-the-board incorporation of disability-based civil rights standards into the operation of all Medicaid programs. It also contemplates a high standard of care:
The Health Care Financing Administration's vision in the current Strategic Plan guarantees that all our beneficiaries will have equal access to the best health care. Pivotal to guaranteeing equal access is the integration of civil rights laws into the fabric of all HCFA program operations and activities.... These laws include...Section 504 of the Rehabilitation Act,...the Americans with Disabilities Act of 1990,... as well as other related laws.
The statement disallows disability-based discrimination in the Medicaid program and emphasizes that civil rights concerns should be part of the central "culture" of all Medicaid programs. Finally, HCFA adopts a strident approach to ensuring that persons with disabilities benefit from Medicaid programs:
We will continue to vigorously assure that all Medicare and Medicaid beneficiaries have equal access to and receive the best health care possible, regardless of...disability.
The statement is useful to consumers seeking Medicaid-funded AT. First, it does not pay mere "lip service" to disability-based civil rights laws such as the ADA. It mandates that ADA standards (e.g., community integration, equal access to programs and services) be part of the underlying philosophy of all Medicaid programs. Second, it contemplates consumer access to "the best health care", not a minimal or "bare bones" level of entitlement. Applied to the AT context, a consumer may invoke the statement to justify access to: 1) "high quality" AT; 2) AT which promotes ADA goals such as community independence; and 3) AT which provides the consumer with functional equal access to community programs and settings.
Elimination of Restrictive Medicaid Regulation
Last winter, Delaware's Department of Health & Social Services adopted a new regulation. It defined the scope of "medically necessary" services and devices for the entire State Medicaid program. Unfortunately, it included the following problematic provision:
...(S)ervices which are primarily used for educational, vocational, social, recreational, or other non-medical purposes are not covered under the Medicaid program.
Several consumer-oriented organizations objected to the provision as both contrary to Federal law and, on a practical level, simply bad policy. 4 For example, Federal special education law envisions Medicaid coverage of medically-related services (e.g., therapies and AT) included in students' individualized plans (e.g., IEPs and IFSPs). 5 Likewise, Delaware's Division of Vocational Rehabilitation traditionally relied on Medicaid to fund medically-related rehabilitation of consumers with disabilities seeking employment. Literally, the regulation prohibited Medicaid coverage of any device or service if 51% of use supported educational, vocational, social, or recreational goals. In other words, the more useful a device or service in a consumer's life, the less likely Medicaid would cover it!
After a meeting between advocacy organizations and Department representatives, the State agreed on July 29 to delete the objectionable provision in its entirety. Advocates hailed the reversal in policy as a promising illustration of the Department's willingness to carefully consider consumer views on policies. The reversal was also viewed as an endorsement of the Department's own mission statement, which underscores the value of promoting self-sufficiency and independence.
The potential effect on consumer access to AT is significant. Applications for AT should not be denied simply because a consumer is expected to use the device at work, in school, or in social or recreational settings. The goal of any AT should be to maximize its usage across environments. For example, an augmentative communication device would be grossly underutilized if restricted to communication with a doctor. A consumer should logically use the device to communicate with family, teachers, fellow employees, store clerks, and peers.
Policy Letter on Denial Codes
During the same month of July, the State issued a second Medicaid policy reversal which should benefit consumers.
The Division of Mental Retardation's Assistive Technology Committee prompted the policy review. 6 The Committee was alarmed by Medicaid managed care notices which justified service rejections because conditions were considered long-term or "chronic." The State had inadvertently approved the following denial code:
Your problem is chronic. It will not significantly improve in the allowed timeframe with physical therapy, speech therapy, occupational therapy...
The Committee requested review since mental retardation is inherently chronic and State Medicaid regulations authorize services to prevent "worsening" of conditions or to promote "retention" of functional capacity.
A second Committee concern was the State's approval of vague managed care notice codes. Although both caselaw and regulations require that denials disclose specific and meaningful reasons, the State had approved use of multiple "unenlightening" codes. For example, the following codes were approved:
- The procedure, service or item does not meet our medical guidelines for coverage.
- More conservative therapy should be considered.
- The medical care can be given in another setting.
When presented with the Committee's concerns, State Medicaid officials responded promptly. In a July 9 policy letter, the State rejected use of any "chronic condition" code and promised to ensure that managed care notices provide "detailed explanations" justifying denials.
This policy clarification should benefit consumers seeking AT. First, a consumer need not prove that a medical condition will "improve" through provision of requested AT. It is sufficient, particularly in the context of chronic conditions, that the AT will prevent deterioration or promote retention of functioning. Second, since rejections of AT must include specific reasons, a consumer can more effectively respond to denials by either: 1) advising the managed care organization that its denial is based on obviously erroneous information; or 2) obtaining discrete countervailing evidence (e.g. doctor's opinion).
Conclusion
In conclusion, recent Federal and State policy statements reflect a promising consumer orientation. At the Federal level, HCFA has endorsed caselaw and standards which promote independence and community-based supports. At the State level, a restrictive "medical necessity" standard and a "chronic condition" exclusion are being stricken. Finally, the State has promised to require specific codes in all rejections of Medicaid services. For consumers relying on AT, these developments suggest that the Medicaid system is evolving towards a more responsive and flexible support program.
Footnotes
1. Background on the policy letter, as well as the full text, is available on the Web site of the National Health Law Program, Inc. at http://nhelp.org/publications.shtml.
2. The three decisions are Helen L. v. Didario, 46 F.3d 325 (3d Cir.), cert. denied, 116 S. Ct. 64 (1995); Easley v. Snider, 36 F.3d 297 (3d Cir. 1994); and L.C. v. Olmstead, 138 F.3d 893 (11th Cir. 1998). Since the Third Circuit is the Federal appellate court for Delaware, Pennsylvania, and New Jersey, the interpretations of Federal law in Helen L. and Easley are binding in these states.
3. The background and full text of the policy is available on the Web site of the National Health Law Program, Inc. at http://nhelp.org/publications.shtml.
4. Organizations objecting to the regulation included the Disabilities Law Program, Delaware Assistive Technology Initiative, Developmental Disabilities Planning Council, State Council for Persons with Disabilities, Governor's Advisory Council for Exceptional Citizens, and Division of Vocational Rehabilitation Advisory Council.
5. Several provisions of the Individuals with Disabilities Education Act ["IDEA"] address Medicaid coverage of special education services. See, e.g., 20 U.S.C. §§ 1412(a)(12), 1412(e), and 1440.
6. The Committee, comprised primarily of Division of Mental Retardation personnel, also includes representatives of the Delaware Assistive Technology Initiative and the Disabilities Law Program.
