Many provisions of The Affordable Care Act signed by President Obama are scheduled to take effect in 2014. The change that will have the biggest effect on people with disabilities is the requirement that private insurance carriers provide coverage regardless of preexisting conditions. The new law allows health insurance providers to ask only three questions in deciding coverage availability and premiums: age of the applicant, sex of the applicant, and whether the applicant smokes. While this provides individuals with disabilities increased access to private health insurance, consideration of public benefits is still needed.
Currently, the method of choice for individuals for health insurance is Medicaid. Many individuals receive Medicaid based on their receipt of Supplemental Security Income (“SSI”). The receipt of SSI is protected by the creation of a special needs trust to hold assets above the SSI. While the full effects of access to private insurance by those with preexisting conditions have yet to be seen, there is cause to believe that public benefits eligibility will remain a factor for people with disabilities.
Differences between the private insurance offered under the Affordable Care Act and Medicaid:
1. Cost: The premium amounts for the comprehensive health insurance provided by private companies have yet to be seen. It is predicted that the inclusion of those with preexisting conditions and the expansion of covered services will greatly increase the price of private health insurance. These premiums may be over $700 a month. Medicaid does not require a disabled individual to pay a premium monthly.
2. Cash: Another benefit provided by public benefits is a monthly check. While the main reason for pursuing SSI eligibility is to secure Medicaid benefits, it also provides an additional revenue stream of a few hundred dollars per month.
3. Coverage: The health insurance provided by private insurance companies under the Affordable Care Act is comprehensive, but it does lack services relied upon by many individuals with disabilities. The main service not provided by private health insurance is at home care. The cost for at home care to assist an individual with a disability can be extremely high. This service is provided under Medicaid through several Medicaid waiver programs.
For these and other reasons, it is still important to consider the availability of public benefits when planning an estate plan to benefit an individual with a disability.