What Health Plans Are Available For People With Disabilities?

Medicaid

Over 10 million people qualify for Medicaid based on disability. Various eligibility pathways exist, but most people qualify through the Supplemental Security Income (SSI) pathway. People with low incomes, limited assets, and an impaired ability to work due to old age or disability are eligible for SSI benefits. The maximum income allowed is generally 74 percent of the federal poverty level (FPL).

In most states, SSI recipients automatically qualify for Medicaid and do not have to fill out a Medicaid application. In other states, eligible beneficiaries must apply for Medicaid, and in some states, SSI does not necessarily guarantee Medicaid eligibility.

If people with disabilities have income or assets that exceed SSI levels, they can receive Medicaid coverage through other pathways. States can extend coverage to working people with disabilities, choosing to either apply or eliminate asset limits. States may also expand coverage to those whose income exceeds the SSI limit but is not above 100 percent FPL.

States can adopt the Katie Beckett pathway, which extends coverage to children up to age 19 with significant disabilities living at home. This pathway does not consider household income, but children must meet SSI medical disability criteria and qualify for an institutional level of care per the state’s functional eligibility criteria. The Family Opportunity Act pathway provides coverage for children with significant disabilities living at home, but family income cannot exceed 300 percent FPL.

High-income people with disabilities may qualify for the medically needy pathway if they spend down to a state-specified medically needy income level by incurring medical expenses.

States may choose to adopt the Section 1915 (i) pathway, extending Medicaid coverage to those at risk of institutional care. Through this option, states can provide full Medicaid benefits to people who meet certain financial and functional criteria and are not eligible through other pathways.

This option can cover beneficiaries with incomes up to 150 percent FPL who have needs that are less than what is required to qualify for an institutional level of care or people with incomes up to 300 percent of the SSI limit who would be eligible for Medicaid under an existing home- and community-based service (HCBS) waiver.

After qualifying for Medicaid, beneficiaries can receive coverage for primary and acute care and long-term services and supports (LTSS). People with disabilities are more likely to require LTSS, which are seldom covered by Medicare or private health plans. LTSS can include institutional care and HCBS care.

Medicare

Medicare coverage is available for people under 65 who have received Social Security Disability benefits for 24 months, have End-Stage Renal Disease (ESRD), or have Amyotrophic Lateral Sclerosis (ALS). After a beneficiary is determined to have a disability, there is a five-month waiting period before they can start collecting Social Security Disability benefits.

Medicare coverage is the same for people who qualify based on disability and those who qualify based on age. The public program covers hospital, nursing home, home health, physician, and community-based services, whether or not they are related to a beneficiary’s disability.

People with disabilities who work can continue receiving Medicare benefits. However, 8.5 years after the work starts or resumes, beneficiaries must pay the Part A premium.

Some beneficiaries with disabilities may qualify for a special needs plan (SNP) in Medicare Advantage. SNPs are designed to treat beneficiaries with specific diseases or healthcare needs. SNPs are either health maintenance organization (HMO) or preferred provider organization (PPO) plans. In addition to covering Medicare Part A and Part B benefits, SNPs may also cover extra services tailored to the population they serve.

The three types of SNPs include dual eligible SNP (D-SNP), chronic condition SNP (C-SNP), and institutional SNP (I-SNP).

Each plan has its own eligibility requirements. For example, beneficiaries eligible for both Medicare and Medicaid can enroll in a D-SNP, which contracts with state Medicaid programs to coordinate Medicare and Medicaid benefits. C-SNPs are available for people with one or more severe or disabling chronic conditions, including cancer, dementia, diabetes, and HIV/AIDS, among others.

To be eligible for I-SNPs, beneficiaries must live in a nursing home, intermediate care facility, skilled nursing facility, rehabilitation hospital, long-term care hospital, psychiatric hospital, or other long-term care facilities for at least 90 consecutive days. People may also be eligible for I-SNPs if they live in the community but need the level of care that a facility offers.

ACA Marketplace

If people with disabilities do not qualify for Medicaid through any pathways or have not yet received Social Security Disability benefits for 24 months, they can purchase coverage through the Affordable Care Act (ACA) marketplace.

However, once the two-year waiting period for Medicare ends, any marketplace subsidies received will end, too. Individuals may keep their marketplace coverage in addition to their Medicare coverage but will have to pay the full coverage amount, and Medicare will be the primary payer.

If individuals indicate they have a disability when applying for marketplace coverage, HealthCare.gov will send the application to the state’s Medicaid office to determine if the individual qualifies for Medicaid.

Commercial plans

Private insurance is less common among people with disabilities due to the availability of public coverage. However, disability insurance benefits are typically a component of employer-sponsored health plans.

If employers choose to include disability insurance in their benefits packages, employees will continue to receive income in the event a disability prevents them from working. Short-term disability often covers benefits for less than one year, while long-term disability can span to age 65 or over.

When seeking healthcare services, people with disabilities can often receive coverage through public payers. But if they do not meet the specified criteria, other coverage options on the marketplace or through employers are available.