Medicaid Comparison, Case Study Example

Under the Medicaid Act of 1965, the US government established the Medicare program.  The legislation allowed each state to establish requirements for who was eligible to receive Medicare health care benefits.  There were many different reasons for why the government chose to structure the program in this way; foremost amongst these, the federal government wanted to give states ample incentive to participate in the program which meant devolving control to the state level.  State governments have power to determine who receives benefits and what benefits they ultimately receive.  Under the agreed upon financing system, the federal government and state government equally split the costs related to providing Medicaid.

Hawaii was one of the original states to join the Medicaid program after it was initiated in 1965. Since adopting the program, Hawaii has gradually expanded the scope of recipients and benefits in order to keep up with a growing population, particularly an aging population.  As the economic recession led to massive job losses and large cuts in revenue, Hawaii has moved to cut the number of Medicaid beneficiaries and benefits.  Indeed, since mid- June 2008, there has been a 26% increase in the number of people seeking enrollment in Medicaid coverage due to lost health care insurance coverage.  As a result of this, the state government has moved to increase the minimum income levels to be eligible for the program.  Whereas a family of four who earned $51,420 was previously eligible for Medicaid benefits, under the new plan a family of four will need to have an income around $34,194 to be eligible for benefits (CNBC, May 11, 2011). Regarding the standards for single individuals, existing regulations mandate that singles who annually earn less than $24,396 are eligible for Medicaid benefits.  In addition, starting on January 1, 2012, the state will reduce the benefits package given to non-disabled, non-pregnant adults less than 65 years in age (CNBC, May 11, 2011).  Under the new package, the following service limits would be imposed on those eligible for Medicaid: each individual annually is only eligible for 20 outpatient visits, 10 inpatient days and three outpatient surgical procedures a day.
The new limitations on coverage are aimed at preserving the viability of the program over the long-term.

Traditionally, the state of Minnesota has provided fairly robust Medicaid benefits while also trying to innovate in providing better care for Medicare recipients.  While the state has done a good job providing Medicaid coverage to urban residents, it has had trouble delivering care to rural residents.  The Medicaid program in Minnesota is called “Medical Assistance.”  Overall, Minnesota’s minimum standards for providing Medicaid coverage are far lower than Hawaii’s.  According to current state regulations, an individual may apply for Medicaid benefits if there income is less than $677 per month or $8,124 per year.   For a married couple, they are eligible to apply for benefits for $911 per month or $10,392 per year (Minnesota Department of Human Services, 2010).  In addition to offering benefits at a lower level of income, the state also offers a more robust package of benefits than Hawaii. While a modest co-pay is required for office visits, individuals are not only entitled to doctor’s visits but also for reimbursement for most clinical tests, mental health visits, and prescription drugs (Minnesota Department of Human Services, 2010).  Even in the midst of a more austere fiscal climate, state government cuts to the Medicaid program in Minnesota are far less than those in Hawaii.

References

CNBC.  (2011 May 11).  Officials: Medicaid eligibility trimmed in Hawaii.  Available at: http://www.cnbc.com/id/42988042/Officials_Medicaid_eligibility_trimmed_in_Hawaii.

Minnesota Department of Health. (2010). Medicaid Guidelines.  Available at: http://www.dhs.state.mn.us.