December 19,2005

Grassley Scores Major Victory for Families with Disabled Children

WASHINGTON -- Sen. Chuck Grassley said the five-year budget plan making its waythrough Congress includes the bipartisan proposal he’s championed with Sen. Ted Kennedy tohelp children with disabilities and their families.

This Family Opportunity Act allows states to create options for families with disabledchildren to buy into Medicaid while continuing to work. Parents would pay for Medicaidcoverage on a sliding scale. Medicaid is critical to the well-being of children with multiplemedical needs because it covers many services that these children need, including physicaltherapy and medical equipment. Private health plans often are much more limited in what theycover.

“Parents want to provide the best they can for their children, and when a child needssomething, parents will do whatever they have to in order to take care of their kids. It doesn’tmake any sense for public policy to force parents of disabled children have to drop out of theworkforce or keep themselves in a low-paying job just to remain eligible for Medicaid,” Grassleysaid. “Congress should give states the flexibility to give families options without the federalgovernment getting in the way.”

Grassley said the Family Opportunity Act is pro-work because it lets parents workwithout losing their children’s health coverage, pro-family because it encourages parents to workand build a better life for their children, and pro-taxpayer because it means more parents continueto earn money, pay taxes and pay their own way for Medicaid coverage for their children.The Family Opportunity Act has attracted widespread bipartisan support in each Congresssince Grassley and Kennedy first authored it in 1999, with co-sponsors numbering 70 or more. AHouse version of the measure sponsored by Reps. Pete Sessions and Henry Waxman alsoenjoyed strong support with more than 235 cosponsors. The Senate Committee on Finance firstapproved the measure in 2002, on a voice vote, without controversy. The full Senate first passedthe Family Opportunity Act in May 2004.

Grassley today serves as Chairman of the Senate Committee on Finance, and was a keynegotiator on the budget proposal adopted earlier today by the House of Representatives andwhich could come up for a vote in the Senate as early as today.

Medicaid is a medical assistance program jointly financed by the federal government andstate governments for eligible low-income individuals. It also covers health care expenses for theneedy elderly, the blind and the disabled receiving cash assistance under the SupplementalSecurity Income Program.

A summary of the major provisions of the Family Opportunity Act, as included in theDeficit Reduction Act of 2005, follows.

DESCRIPTION OF THE PROBLEM

The National Health Interview Survey (NHIS) and current Census data shows that eightpercent of children in this country have significant disabilities, many of whom do not have accessto critical health care services they need. In order for these families to get needed health services fortheir children, many are forced to stay impoverished, become impoverished, put their children in outof home placements, or simply give up custody of their children so that their child can maintaineligibility for health coverage through Medicaid. Many employer health plans and a number ofCHIP/SCHIP programs do not cover essential services that these children need to maintain andprevent deterioration of their health status. Medicaid can provide these comprehensive services.

In a recent survey of 20 states, families with special needs children report they are turningdown jobs, turning down raises, turning down overtime, and are unable to save money for the futureof their children and family so that they can stay in the income bracket that qualifies their child for SSI and/or Medicaid.

Currently, less than four percent of the 850,000 children receiving Social Security benefitsleave the Social Security rolls due to increased family income. However, many would do so ifaccess to needed health services was available. More than half the States are reporting increasingrates of families giving up custody of their children in order to secure needed health care servicesand supports.

The Family Opportunity Act of 2005 is intended to address the two greatest barrierspreventing families from staying together and staying employed: (1) lack of access to appropriateservices and (2) lack of access to the advocacy and assistance services they need to help cut the redtape to meeting their children’s health care needs.

DESCRIPTION OF SOLUTIONS UNDER THE FAMILY OPPORTUNITY ACT OF 2005

Access to Health Care Coverage

Expanding Medicaid Coverage Options. A new optional eligibility category will allow states toexpand Medicaid coverage to children with disabilities up to age 18, who would be eligible for SSI disability benefits but for their income or resources. This option builds on previous reforms including the provision enacted in the Balanced Budget Act of 1997 and the Ticket to Work and Work Incentives Improvement Act of 1999.

These provisions permit states to offer a Medicaid buy-in for disabled children who would be eligible for SSI disability benefits but for their income, who are in families earning up to 300 percentof poverty.

In order for a family to participate in the Medicaid buy-in for their disabled child or children, a statemust require a parent to take employer-offered insurance within the following guidelines: (1) theemployer offers family coverage under a group health plan and (2) the employer contributes at least50 percent of the total cost of the annual premium for the coverage.

If such coverage is attained by the family, the state is required to reduce the premium charged for thebuy-in, in an amount that reasonably reflects the parent’s premium contribution for private coveragefor the child with a disability.

Participating states may charge premiums up to the full cost of the premium as long as that premiumdoes not exceed 5 percent of family incomes up to 200 percent of the poverty level and 7½ percentof family incomes between 200 and 300 percent of the poverty.

The state may waive payment of a premium in any case where the state determines that requiring apayment would create an undue hardship.

Alternatives to Psychiatric Residential Treatment Facilities for Children

The bill provides funds for demonstration projects in 10 States to examine the effectiveness of homeandcommunity-based alternatives to psychiatric residential treatment facilities for Medicaid-enrolledchildren.

Restoration of Medicaid Eligibility

Restores Medicaid eligibility only for children meeting the presumptive eligibility requirementsunder SSI without having to wait until the first day of the month following the establishment ofeligibility.

Access to Health Information and Resources

Establishing Family to Family Health Information Centers. The bill provides funds forestablishing health information centers to assist and support families of children with disabilities andspecial health care needs. These centers, staffed by both parents of children with special needs andprofessionals, would provide technical assistance and accurate information to other families onvarious health care programs and services available and appropriate for children with special needs,including identifying successful health delivery models. In addition, these centers would act as aresource to healthcare insurers, providers, and purchasers in developing ombudsman models forcollaboration between families of children with special needs and health care professionals.

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