Congress Close to Finalizing Important Medicaid Extensions

On Tuesday, the U.S. House of Representatives passed the IMPROVE Act (H.R. 7217), which extends two critical Medicaid programs for older adults and people with disabilities. The U.S. Senate is expected to consider the bill as soon as next week.

First authorized in the Deficit Reduction Act of 2005, the Medicaid Money Follows the Person Demonstration Program (MFP) officially launched in 2007. Since then, it has helped over 88,000 older adults and people with disabilities transition from nursing and other facilities back to the community, and it has consistently been a cost-effective, successful program. According to independent, national evaluations MFP participants who have transitioned to community-based settings experience lasting improvements in quality of life, and they also decrease their overall Medicare and Medicaid expenditures by roughly 23%, generating considerable cost savings for the programs.

The program expired in September 2016, and states have been struggling to keep their programs afloat since then, with many scaling back their transition activities due to funding constraints. The IMPROVE Act extends MFP for three months, preventing a further lapse in funds and setting up the next Congress to consider a full reauthorization in early 2019.

Similarly, the IMPROVE Act temporarily continues the guarantee of vital spousal impoverishment protections for older adults and people with disabilities. Set to expire on December 31, these protections allow married couples to protect certain assets while seeking Medicaid coverage for home and community-based services (HCBS). Under the rules, when one or both spouses receive Medicaid HCBS, the couple is able to retain a modest amount of income and resources to meet basic needs, without jeopardizing their Medicaid eligibility.

If this policy were to expire, experts predict some married couples would lose Medicaid eligibility because states would have to count their income and assets that are currently protected under the impoverishment rules, possibly making them ineligible for coverage. Most would still be eligible if they entered a nursing home, but others might forgo needed care in order to stay in the community, putting their health and financial well-being at risk.

Allowing this policy to lapse and MFP funding to further erode would create significant challenges for older adults and people with disabilities. To prevent these disruptions, we support the IMPROVE Act, which will give lawmakers until the end of March to pass longer-term extensions. We look forward to working with lawmakers and advocates to achieve more permanent solutions next year that help ensure older adults and people with disabilities have the option to remain at home and in the community.

The Medicare Rights Center recently joined a letter to all members of Congress, urging them to continue these two key Medicaid policies. Read the letter.

Read the IMPROVE Act.

Read Medicare Rights ‘Protect and Strengthen’ Fact Sheets on Medicaid and Medicaid and Medicare.