Medicaid is a state/federal program providing health insurance for low-income Americans. In Arizona, Medicaid is known as the Arizona Health Care Cost Containment System (AHCCCS, pronounced “access”). People on Medicare, who have income below $950 per month, qualify for AHCCCS help. These folks are called “dual eligibles” because they have both Medicare and Medicaid/AHCCCS.

Some changes are coming in 2014 for dual eligibles, and some changes that were supposed to happen have been canceled.

Medicare Advantage plans for duals:

Many dual-eligibles are enrolled in Medicare Advantage plans that are designed to work with the AHCCCS system which pays co-pays and co-insurance. A dual-eligible person should not have any co-pays for their medical care, and their Medicare Advantage plan should co-ordinate with their AHCCCS health plan so the patient has no costs. Co-ordination is key because these Medicare Advantage plans have networks and AHCCCS health plans have networks, and the patient must use doctors that are in both plan networks. It’s kind of complicated.

Certain  Medicare Advantage plans for duals will be canceled as of January 1st 2014.

In Pima County, the Health Net Amber Plan and the Abrazo Dual plan will be canceled because they will not have an AHCCCS plan, and this will be a requirement in 2014.  Abrazo and Health Net will have AHCCCS health plans in Maricopa county in 2014, so their Medicare Advantage plans for duals will continue there.

In Pima County, thousands of dual-eligibles will have to change their Medicare Advantage plan. They will receive a notice from AHCCCS this summer – if AHCCCS has their correct address. Insurance agents who enrolled people in Abrazo and Amber will want to change them to another plan – if they can find them.

Arizona drops out of Dual Demonstration project

Last week, Arizona informed the federal government it is dropping plans to integrate Medicare coverage with Medicaid (AHCCCS) in 2014. The plan would have required the state to have every dual-eligible person enrolled in the same Medicare Advantage plan as their AHCCCS plan.  The idea was to create one coordinated health plan that would encompass Medicare and Medicaid.  It would also  avoid some of the complications that come with making sure people stay in their plans’ networks so they do not incur any medical bills.  Better coordination of care was also a target of this “demonstration plan”.

Cancellation of this demonstration project means no chaos for most low-income Medicare beneficiaries this fall.  But for people enrolled in the Amber plan and Abrazo dual plan, they will have to make a change, or they will be moved back to Original Medicare and assigned a Part D plan – if Medicare can find them to let them know about the change.

NOTE: Dual-eligibles can change their Medicare Advantage plan or their Part D plan throughout the year.

The networking site, “Linked-In” has several groups for insurance agents, and there were recently some posts about the Obamacare mandate requiring everyone to buy health insurance starting in 2014.  I offered my thoughts on health insurance and the mandate as follows:

Until July of this year, Arizona Medicaid, known as AHCCCS (Arizona Health Care Cost Containment System)  and pronounced “access”, was very generous and would provide health insurance for people who ended up in the hospital without health insurance – even if they were not indigent. I have met accountants, property managers, and housewives who did not have insurance, got sick, and ended up in the hospital with huge bills. The hospital social worker signed them up for the for the AHCCCS Medical Expense Deduction  (MED) program and covered them for six months to more than a year.

Under the Medical Expense Deduction program, the state of Arizona provided people with health insurance and covered them 100% for their hospital bills and ongoing medical care.  As of July 1, 2011 the program was canceled, but those already in the system continue to get coverage.  I wrote about this program in a previous post: “Arizona Should Not Help People with Their Medical Bills”.

I am a generally a “bleeding heart liberal”, but I am glad to see the end of a program that rewarded people who went without health insurance and provided them with 100% coverage and no penalty for sticking the state and taxpayers with their bills.

I’m at the point where I think people who show up at the ER without health insurance should be turned away. How dare they think their state, or the hospital, and ultimately those of us with insurance, should pay their bills. So let ‘em croak on the hospital doorstep!

Is that a good idea? And what is the solution to the problem of 40+ million Americans without health insurance? I think it is the same idea Republicans proposed in the 1990′s and John McCain campaigned on in 2008: A mandate that everyone have health insurance (with tax breaks to help people of low and middle-income levels afford the coverage).

I guess I’m liberal on some things and conservative on others.  Or perhaps the idea that people should not get a free ride is neither conservative nor liberal. And perhaps the idea that everyone needs to take responsibility and get health insurance is just common sense.  So why do Republicans insist that “You can’t make me get health insurance!” – even though hospitals cannot turn people away from the emergency room? And I don’t understand why Republicans want to kill the bill that reforms the costly and crazy health insurance system we have now.

I recently wrote about Governor Brewer’s plan to cancel Arizona’s Medicaid program for people who have large medical bills and no health insurance. The program is one part of  AHCCCS (Arizona Health Care Cost Containment System, pronounced “access”).  The title of my post was, “Arizona should not help people with their medical bills”.  Some of the comments made in response to my post were misinformed about how AHCCCS works, and I responded with my general knowledge gained from working with low income Arizonans.  I now have better information on AHCCCS as I recently I had the opportunity to participate in a  conference call with the Director of the Phoenix Area Agency on Aging, who provided an overview of Arizona’s Medicaid program.

The speaker, Ann Marie Grande, talked about the differences between the Arizona Long Term Care System (ALTCS) and Acute Care Services, which is the health insurance program for low income Arizonans.

Arizona Long Term Care System (ALTCS, pronounced “alltex”)

ALTCS pays nursing home costs for low income Arizonans and has several programs to help frail, sick people stay in their homes.  People who apply for ALTCS cannot exceed the asset limit of $2,000 – but a house and car are not counted. However, the state will seek reimbursement once a person who participates in ALTCS dies (or after the surviving spouse dies). The state will require the person’s estate or family to sell the person’s house and reimburse the state for what it spent on long term care for that individual.

For people applying to any of the AHCCCS programs (not ALTCS), the state of Arizona does not consider assets. An insurance agent on the conference call asked Ms. Grande if a person on AHCCCS could own a Bentley, and the answer was “yes”. Ms Grande went on to say that, “in fact, they could have two Bentleys”.  This is because Arizona only asks people about their income when they apply for Medicaid.

Ms Grande also said that if a person has a large amount of money in the bank, this is not counted by AHCCCS.  Money in the bank is only counted if it provides a steady stream of income. A pension, annuity payments, alimony, dividends, and other steady payments are considered income.  But money sitting in a bank account is not a consideration when someone applies for help from AHCCCS.

So it turns out, as I thought, that Arizona is a very liberal state when it comes to helping people with their medical bills.  This is due to Proposition 204, which was approved by a majority of Arizona voters in 2000.  Proposition 204 required that money received from a tobacco lawsuit would be spent on expanding eligibility for AHCCCS programs. Between 2000 and 2025 the state is supposed to receive about $3.2 billion from the tobacco settlement, and this money is supposed to be spent on AHCCCS programs.  AHCCCS has several programs, including the following:

Medical Expense Deduction (MED) program

A person can be enrolled in this program if they end up in the hospital, have no health insurance, and can’t pay their bills.  (I have talked to people receiving treatment for cancer who are on this program as well.)  If person’s income over three months, minus three months of medical expenses, equals 40% of the federal poverty level, that person qualifies for MED.  40% of the federal poverty level would be $363 for an individual and $486 for a couple.  In this case, AHCCCS pays the person’s medical bills. This is supposed to be short-term coverage and is reviewed every six months.  Only income is considered as part of an application for MED – not assets.

Medicare Cost Sharing

This is a program for people on Medicare whose income is below $1,239 (individual) or $1,660 (couple), but above the federal poverty level of $908 (individual) or $1,219 (couple).  Once approved for Medicare Cost Sharing, the state of Arizona will pay the person’s Medicare Part B premium.  Part B premiums range between $96.40 and $115.40. People new to Medicare in 2011 will pay the higher premium.  There is no asset limit to apply for this program.

More help for these folks: When the state of Arizona accepts a person into the Medicare Cost Sharing program, the state will then send information to Social Security so the person gets signed up for a limited income subsidy (LIS) for their Part D drug plan and drug costs.  If a person applies for this help directly to Social Security, they will be asked about their assets.  So the best way to get this LIS help for drug costs is by going through AHCCCS, especially if an individual or couple has some money in the bank.  The application can be found on-line by googling “arizona medicare cost sharing”. When approved for LIS, a person pays only $2.50 for generic drugs, or $6.30 for any brand drug. People on LIS do not have to worry about the Part D donut hole. LIS is a really big help to people with large drug costs and limited income.

Dual Eligible

If a person is on Medicare and Medicaid (with income of less than $908/month), they are called “dual eligibles”.  For these people with very low income, AHCCCS will pay co-pays that come with Medicare coverage.  If a person is enrolled in a Medicare Advantage plan, the person’s AHCCCS health plan may or may not pay co-pays.  This is why it is a good idea to enroll in a Medicare Advantage plan designed specifically for “dual eligibles”, so the Medicare Advantage plan coordinates care to make sure a person’s co-pays are covered and the patient pays nothing for their medical care.