Program lets disabled work, keep Medicaid
Advocates say plan may encourage more people to stay on the job, saving state funds.

By Kevin Corcoran
July 13, 2002

Hoosiers with disabilities no longer have to choose between good-paying jobs and taxpayer-provided health insurance.

This month, Indiana began offering Medicaid for Employees With Disabilities, or MED Works. The program lets disabled workers whose incomes are too high to qualify for regular Medicaid pay modest premiums to keep their full range of benefits.

Because of the state's budget crunch, the program is being rolled out slowly, with advocates for people with disabilities having to spread the word.
"With our budget concerns, it's a very delicate balancing act," state Medicaid Director Melanie Bella said. "But we believe it's the right thing to do. It sends a positive message that you will not be penalized for working."

The threat of earning too much and losing Medicaid's array of medical benefits, which range from pricey mental health drugs to hospital care, keeps many disabled Hoosiers from taking full-time jobs.

Advocates say the program will save taxpayers money by encouraging more disabled people to work. Some disabled workers could increase their hours and qualify for employer-sponsored health insurance, decreasing Medicaid spending.

Despite its benefits, the program initially worried state Medicaid officials because it expands coverage as the state is making sizable cuts in the $4 billion-a-year program. Medicaid, established by Congress in 1965, provides care in Indiana for more than 750,000 low-income pregnant women, children, senior citizens and disabled people.

But Rep. Peggy Welch, D-Bloomington, defends adding this Medicaid option.
"The reasons we passed it are no less important even though we're in a budget crunch," said Welch, who pushed legislation last year creating MED Works. "It moves disabled people into the work force. If they're willing to work, let's let them."

State officials cannot say how many people have signed up, but they have identified 267 people already on Medicaid who may be eligible and are contacting them.

Ryan Kruse, a self-employed graphic designer, has already joined. The 28-year-old Indianapolis man has been unable to buy private health insurance since his spinal cord was damaged in an accident when he was a high school senior.

While receiving workers' compensation benefits for his paralysis, Kruse operated a graphic design business from his parents' home. But he had to drop his biggest client before he applied for Medicaid in 1999, because otherwise he would have earned too much.

Through MED Works, he no longer has to pay a $100-a-month Medicaid deductible and can take on additional work.

The program is open to Hoosiers ages 16 to 65 years old who are disabled and working. State officials estimate 1,600 people may qualify at a cost to the state over the next two years of $1.2 million.

Individuals making up to $31,010 can sign up.

For purposes of determining eligibility, though, some income is not counted -- including work-related expenses, tax refunds, energy assistance and some transportation costs. That means people with gross incomes above $31,010 can qualify.

More than 15 states, including Illinois, Minnesota and Wisconsin, have set up these programs or have passed laws to establish them, according to the National Conference of State Legislatures in Denver.

These "buy-in" programs are made possible through federal legislation passed in 1997 and expanded in 1999. Most programs are new and relatively small.

Federal law permits states to decide who is eligible and how much to charge participants.

Indiana doesn't charge people earning less than 150 percent of the federal poverty level. That's $13,290 for a single person and $17,910 for a married couple. Monthly premiums range from $48 to $254.

In addition, disabled workers who join MED Works no longer have to meet a monthly deductible before they get Medicaid benefits, a requirement known as "spending down."

Cris Fulford, executive director of ATTAIN Inc., an advocacy group for disabled Hoosiers, said she's happy with MED Works.

She helped write the state's application for a four-year, $2 million federal grant that could be used to staff and publicize the program. The grant also could be used for premium collection and research.

Fulford's only disappointment is that state officials, citing Indiana's budget woes, aren't making personal care available to feed, bathe and dress everyone who qualifies for MED Works. That normally is covered.

Sandy Rucker, 63, said she's checking into the new program.

Through the years, she's had her share of go-rounds with state officials. So
she's skeptical.

"I'll have to see it to believe it," she said.

The Indianapolis woman, who gets $638 a month in disability payments, has been paralyzed from her chest down since a motorcycle accident in 1960. She's working with Vocational Rehabilitation Services to modify her house and to find a job.
If she finds work, the new Medicaid program could save Rucker $77 a month.