Meet Kenneth Smith, a lifelong resident of
Tony lives at home with his mother, who is his primary
caregiver in spite of suffering from many disabling conditions herself. Tony receives only three hours a day of care from
home health aids who assist his mother in a combined effort in transferring him
to and from the bathroom, providing daily hygienic care, feeding him breakfast,
and transferring him to his wheelchair for the remainder of the day. His mother attends to the remainder of his
needs required throughout the day, including a nightly bedtime routine of
sanitizing his medical apparatus and drinking water and transferring him back
into and positioning him in bed.
This is where we reach the turning point in our story. You see, he and his mother fear that the
freedom they enjoy by his ability to remain living in their home, is in danger
of coming to an end. Tony is a recipient of Medicaid, which is his primary
health insurance that pays for his home health care attendants, his
pharmaceutical needs, and most importantly his life-sustaining oxygen
generator, nebulizer, and ventilator. The latter three devices sustain his
cardiopulmonary system, that is, his breathing and heart function, of which no
one can live without. The problem is before Medicaid will pay for anything,
including his ventilator, he must first meet the Spend Down requirement before
he is eligible for Medicaid for the month.
Spend Down is similar in effect to a deductible. Disabled individuals,
who meet the Social Security definition of disability, are allowed to have an
income of only $567 a month to be eligible for Medicaid. Any income in excess of $567 must be spent
down in medical expenses to the $567 income limit, hence the term Spend
Down. For example, Tony draws a monthly
Social Security Disability Insurance check of $969 as a surviving disabled
dependent of his stepfather who died in 1993.
Therefore, he must incur a medical expense of $387 a month, his Spend
Down amount, arrived at by subtracting $567 and a standard deduction of $15
from his $969 income. Until recently a disabled individual had to only incur a
medical expense equal to their Spend Down amount, rather than paying this
amount out-of-pocket. Most disabled
Medicaid recipients who are required to spend down,
use a bill that a third party insurance, usually Medicare, will eventually
cover. The bill, a medical expense, is
an incurred expense for which the patient remains liable for until such time
that it is paid by the patient or the patient’s third party insurance, again
usually Medicare. However, the FSSA and
OMPP, the Indiana agencies who administer and manage Medicaid for the state,
are set to implement a rule change as to what expenses will be allowed to count
toward Spend Down effective November 1st 2004. Basically, any
medical bill in the patient’s name that might be paid by a third party
insurance, such as Medicare, at some unknown future date and at some unknown
percentage, will not be allowed to count toward Spend Down. The Medicaid beneficiary will actually have
to pay the expense out of their pocket. Only medical expenses, as always has
been the case, count toward Spend Down.
Only medical expenses are taken into account in reducing the
individual’s excess income. If Tony and others in the same situation are forced
to live on only $567 a month, which is below the Federal Poverty Level income
of $775 a month, they will have no choice but to move into a long-term nursing
institution. This would violate the
doctrine in the Supreme Court’s Olmstead decision, which says that the disabled
have a right to live in “the most integrated community setting available”,
which, in anybody’s opinion would be their family home. In addition, some
Medicaid recipients who are subject to the Spend Down requirement unfortunately
do not always have a medical expense that is exactly equal to their Spend Down
amount. It usually significantly exceeds
the required amount. If the individual cannot afford to pay the remaining
portion not covered by a third party insurance, then they can’t meet their
Spend Down and Medicaid will not cover their other medical expenses, such as
medications that month. If they don’t
meet their Spend Down for three consecutive months, then they are canceled from
Medicaid. Such is the case with Tony’s
mother, who while being disabled, has foregone all of her medications, except
for three, since November of last year.
Her medications total over $1500 a month. She has no choice in the matter!
If all employed disabled Medicaid recipients were subject to
the Spend Down eligibility requirement, as was the case until recently, then
the effort to work would be counterproductive, as all of their excess income
above the $567 limit would have to be spent in medical expenses only. However, in an effort to reconcile Medicaid
eligibility for employed disabled with earnings above the $567 limit, the
Indiana Legislature and Gov. Frank O’Bannon implemented the
Tony makes two points!
First, he contends that the section of the Medicaid Act of 1965 that
allows the disabled to receive Medicaid after having incurred an expense as a
share of cost as it calls it or Spend Down as
Secondly, it is his contention that by allowing employed
disabled individuals, whose income is in excess of $567, to buy into Medicaid
at a reduced cost, while requiring unemployed disabled individuals with
equivalent income, to spend down, violates the Equal Protection Clause of the
14th Amendment. The Equal Protection Clause provides that laws governing rights of individuals, where individuals
are similarly situated and otherwise entitled to those rights but for a single
characteristic, such as gender or race, must protect the individual from being
excluded from that right simply because of the suspect distinguishing
characteristic.”By treating an unemployed disabled
Social Security recipient’s unearned income for purposes of Medicaid
differently from an employed disabled individual's earned income from
employment, violates the doctrine of equal protection”, Tony maintains.
Unearned income is income that is derived from sources other than employment,
where as earned income is income derived from employment. “The state’s
disparaging treatment of unemployed disabled Social Security beneficiaries
unearned income compared to that of an employed disabled counterpart, equates
to saying that the Social Security beneficiary’s income was never earned in the
sense that it was not gained through merit or effort of action, the definition
of earned”, Tony adds. Tony says that, “While I didn’t personally earn my
income, my stepfather paid his required amount of Social Security taxes during
his years of employment, and as a surviving disabled dependent of his, I am
entitled by law to receive benefits”.
“Therefore, it was earned but just not in a current accounting period
that is a direct result of employment”, he further adds.
However, as the cost, to Tony and others in the same
situation, of financing the litigation that would be required would be beyond
their resources, and since the Supreme Court has extended the 11th
Amendment’s scope to disallow lawsuits against states brought by citizens, it
is unlikely that a legal remedy would effect a favorable change. Note; the 11th Amendment only
explicitly forbids citizens of another state and foreign citizens from suing a
state other than their own. Nevertheless, the Supreme Court has interpreted the
amendment saying it implied or should have implied an extension of this
“sovereign immunity” to one’s own state. The only way then that a change would
occur is if the Indiana General Assembly and Governor see the logic of Tony’s
argument, and amend Indiana Code 12-15-41 that established the Indiana MED
Works (Medicaid Buy-in for Employed Disabled) program, to allow all disabled to
buy into Medicaid at equal premium for equivalent income levels. In furtherance of this goal, Tony has created
an online petition titled “Remove Indiana Medicaid Spend Down
Eligibility Requirement for the Disabled”.
Tony urges anyone interested in signing the petition, to do so by
visiting the web site at the end of this article for those with an e-mail
address. If you do not have e-mail, he
will send you a copy of the petition for signing via standard mail. If you are
an attorney and would like to read a more in-depth argument Tony would be more
than happy to send you a paper he has written, or if you are an attorney who
would be interested in representing Tony and others who might like to join in a
lawsuit, feel free to contact him through my e-mail. In ending Tony reminds us “There but by the
Grace of God go I”.
Contact Tony at Recycold@sbcglobal.net
Tony’s online petition can be found at http://www.petitiononline.com/Premium/petition.html
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