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Many Poor Will Lose Medicaid Under Budget Bill, Report Predicts

  • January 30th, 2006

Hundreds of thousands of Medicaid recipients could lose or be denied coverage under the budget bill scheduled to be voted on by the House of Representatives on Wednesday, February 1, according to a new report by the Congressional Budget Office (CBO). Included in this group would be thousands of elderly individuals applying for Medicaid coverage of their nursing home care.

The bill, the Deficit Reduction Act of 2005, includes punitive new restrictions on the ability of the elderly to transfer assets before qualifying for Medicaid coverage of nursing home care.

The asset transfer provisions would delay Medicaid eligibility for 120,000 people, or about 15 percent of the new recipients of Medicaid nursing home benefits each year, the CBO predicts. Meanwhile, the CBO estimates that another provision in the bill that would deny Medicaid coverage of nursing home care to any person with home equity exceeding $500,000 would affect about 2,000 people a year. (For the details of these provisions, click here.)

The bill also gives states broad new powers to force Medicaid recipients to pay premiums and co-payments. States could end Medicaid coverage for non-payers, and hospitals could deny them services. The CBO estimates that about 45,000 enrollees would lose coverage in fiscal year 2010 and that 65,000 would lose coverage in fiscal year 2015 because of the imposition of premiums. About 60 percent of those losing coverage would be children.

House passage of the bill would clear the way for President Bush's signature. Although the report gives Democrats fresh ammunition to attack the bill, the House approved a nearly identical version of the legislation by a vote of 212 to 206 on December 19, and it is unclear whether enough moderate Republicans can be persuaded to change their votes.

So far, one Republican who originally voted for the bill, Rep. Rob Simmons (R-CT), has publicly announced that he will now vote against it after meeting with AARP and other groups about details of the legislation. "Representation is only effective if the elected official listens to the people," Simmons said. "In a democracy the government must serve the people, not reign over them. I have listened and concluded that the budget, as it stands, falls short." In addition, Rep. John Sweeney (R-NY), who had supported the bill, said that currently he is undecided on the legislation, and Reps. Jim Gerlach (R-PA), Jim Ramstad (R-MN) and Frank LoBiondo (R-NJ) also are "seen as potential vote-switchers," according to CongressDaily. Rep. Walter Jones (R-NC), who last month did not vote on the bill, is expected to vote against the legislation.

To read the CBO report, click here.

To read a New York Times article on the CBO report, go to: http://www.nytimes.com/2006/01/30/politics/30budget.html (Free registration required and article is available free of charge for only one week.)

Related ElderLawAnswers articles:

New Medicaid Law Means Adult Children Could Be on Hook for Parents' Nursing Home Bills

Vote on Budget Set for Feb. 1; Groups Seek to Sway GOP Moderates

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Last Modified: 01/30/2006

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