For over two decades, the federal government has required states to attempt posthumous recovery of long-term care costs for enrollees 55 and older in Medicaid — the government medical program for the poor that pays the bulk of the nation's nursing-home patient costs. States also were given leeway to bill estates for these enrollees' other medical costs.
The Affordable Care Act (ACA) didn't change what's known as "Medicaid estate recovery" or expand it in any way. What the 2010 health care overhaul did do is increase the number of people who financially qualify for Medicaid, known as Medical Assistance in Minnesota, which also provides coverage for regular doctor visits, hospitalization and prescription drugs for poor people under 65.
A report by the Duluth News Tribune recently spotlighted a troubling twist when it comes to Medicaid estate recovery. State officials are pursuing posthumous collection of traditional medical costs for newly eligible Medical Assistance enrollees between the ages of 55 and 65.
This shortsighted practice is legal, but it should end as soon as possible. While well-intended as a cost-saving measure, this is a significant departure from the long-standing, better-known policy of recovering long-term-care costs for the aged. The intent of the ACA is to provide assistance for traditional medical coverage — not bill people later for it.
That access-to-coverage intent is reflected in the other ways that the health reform law helps people get insurance. Those who aren't eligible for Medicaid but get subsidies to buy private plans aren't expected to pay back the subsidies or the costs of their care after death. Nor is there an expectation that those who qualify for MinnesotaCare — the state's public health plan for those who make too much for Medical Assistance but not enough to comfortably afford private plans — pay back their costs posthumously.
It's also worth noting that Medicare — the federal program covering doctor visits, hospitalization and prescription drugs for those 65 and older — does not try to recover medical costs after death.
Minnesota, which jointly funds the Medicaid program here along with the federal government, appears to have the discretion to stop this disturbing practice for newly eligible Medicaid enrollees 55 and older. The state of Washington adjusted its Medicaid estate recovery policies three years ago to protect those in this age group who obtained access through the ACA's expanded Medical Assistance. It limited estate cost recovery to long-term care, which the newly enrolled are unlikely to need.
At the time, Dorothy Teeter, Washington's health authority director, said the costs of the change would be minimal. Total annual recoveries were around $17 million for the program, and most costs were "still tied" to long-term care, she said.
Teeter and other officials expressed concern that this policy could deter people from signing up for newly available coverage under the ACA. We share that concern and have serious reservations about fairness and how well-informed enrollees are when they sign up for Medical Assistance in Minnesota.
Minnesota state health officials have essentially made an "it's in the fine print when you enroll" argument. That's true, but health insurance is a complex purchasing decision, a reality acknowledged by MNsure's comparison shopping tools and the legions of navigators and brokers needed to help people enroll. It's easy to see how this detail could get overlooked.
Those who are eligible for Medical Assistance also have few other options for coverage. They can't get subsidies to buy private insurance or qualify for MinnesotaCare. There isn't an opt-out choice for those concerned about claims against mostly modest estates other than going without or buying unaffordable private insurance. That's a choice Minnesotans shouldn't have to make.
State Sen. Tony Lourey, DFL-Kerrick, has vowed to introduce the legislation necessary to undo this counterproductive policy. Department of Human Services Commissioner Emily Johnson Piper merits praise for being open to estate recovery changes, including some that would better protect family farms in rural Minnesota. These changes merit swift debate and action.
