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State Medicaid Officials Seek Clarity on Federal Reimbursement of Medicaid Services for Katrina Victims

SEPTEMBER 9, 2005 -- State Medicaid officials said Friday they want "simple and straightforward" answers from the federal government about financial reimbursement for health services provided to Hurricane Katrina victims.

They need to know, for example, how to proceed with Medicaid eligibility for Katrina victims whose Medicaid status cannot immediately be verified and for individuals who now qualify for the program due to losses suffered in the hurricane, Ohio Medicaid Director Barbara Edwards said Friday during a telephone news briefing sponsored by the Kaiser Commission on Medicaid and the Uninsured.

Centers for Medicare and Medicaid Services Administrator (CMS) Mark B. McClellan said Friday that officials are working on the answers.

The technical questions related to providing coverage for Katrina victims who relocated from their home states, made more complex by the numerous differences among the states' Medicaid programs, demand "simple and straightforward" answers from the feds.
Ruth Kennedy, Louisiana's deputy Medicaid director, said during the briefing the hurricane damage was sure to increase the demand for Medicaid-provided services. For example, elderly people previously cared for by family members at home will now require nursing home care. Evacuees have significant health needs and must be enrolled in Medicaid coverage as quickly as possible, Kennedy said.

"Time is of the essence," she said, adding that the more days that pass before state officials know what Medicaid will pay for, the more difficult it will be to provide needed health services.

While President Bush said Thursday that states would be reimbursed for "showing compassion" to Katrina victims, Edwards said it remained unclear how state Medicaid programs and their health providers would be compensated for delivering care to hurricane victims. Bush, in his remarks, said he would work with Congress to reimburse states for providing Medicaid services.

Democrats in the House and Senate have offered legislation that would provide full federal funding for Medicaid services to Katrina victims without requiring them to pass the program's asset or income tests.

McClellan said CMS officials were working with state Medicaid officials to provide a new category of eligibility for Medicaid and State Children's Health Insurance Program (SCHIP)—including for groups, such as childless adults, who usually would not qualify—for Katrina victims who either cannot prove they are currently eligible or whose eligibility cannot be verified in their home state.

"We're looking for a straightforward presumptive eligibility process," McClellan said. Individuals who think they may qualify for Medicaid should start the enrollment process, he said.

Elements of that waiver, McClellan said, will include waiving of normal document requirements verifying an individual's Medicaid or SCHIP status in their home state. Host states, at a minimum, will provide their own Medicaid and SCHIP benefit packages to evacuees. States should submit both their administrative costs and the cost of delivering medical care to CMS for reimbursement, McClellan said.

McClellan also said there were no plans to delay the Jan. 1 start of the new Medicare prescription drug benefit due to concerns that displaced Katrina victims, including "dual-eligibles" who qualify for both Medicaid and Medicare coverage, will not receive enrollment information. Dual-eligibles will lose their Medicaid drug coverage as of Jan. 1 as part of the drug law (PL 108-173).

"We will be working out the details so everyone can take advantage of the drug coverage on Jan. 1," McClellan said. The Democrats' Katrina legislation would lift some of those time restrictions, including financial penalties for those who do not enroll by Jan. 1.

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