Medicaid

Today, Medicaid is a major social welfare program that provides insurance benefits to some low income individuals, especially pregnant women and children, as well as disabled people. Medicaid is jointly funded on the state and federal level, but is independently administered by each state. Medicaid policies for establishing eligibility are different for every state, as are the services provided and payment arrangements.

Medicaid is a complex system, and an individual who is eligible in one state may not be eligible in another state. To further the confusion, Medicaid may be known by different names in different states. In California it is known as Medi-Cal, in Massachusetts its called MassHealth, and in Tennessee it is called TennCare. Medicaid was created along with Medicare in 1965 under President Lyndon B. Johnson as an amendment to the Social Security system.

Services

Medicaid will pay for services such as:

• In-patient and out-patient hospital stays
• Nursing home stays
• Doctor visits
• Lab exams
• X-rays
• Hospice
• Physical therapy
• Rehabilitation services.

Much like with a Health Maintenance Organization (HMO), patients are restricted to visiting pre-approved physicians and other providers within the Medicaid network system. Providers who treat Medicaid patients are not fully reimbursed for their charges, and as a result, many practitioners will limit the number of Medicaid patients they will agree to see.

Eligibility

While eligibility statutes vary from state to state, states are not permitted to require any residency requirement aside from simply being a resident of the state. The age of the applicant and employment status are not permitted to have any bearing upon eligibility. Also, federal law prevents states from canceling any other welfare benefits a person may be receiving if they become eligible for Medicaid.

Problems and Challenges

The Medicaid system has been fraught with continuous problems. Fraud is a major issue which wastes millions of taxpayers' dollars every year. Both patients and health care providers have been guilty of making fraudulent claims independently of each other, and conspiring together in the process of making fraudulent claims.

In an attempt to address this, Congress passed laws in 1996 making people criminally liable for committing fraud in an effort to gain Medicaid eligibility or assistance. Despite this, Medicaid continues to be plagued by problems, and is stretched too thin to properly serve the needs of its over 47 million beneficiaries. It is a very costly program for taxpayers to support. In 2002, Medicaid spending exceeded that of Medicare. The program will continue to increase in spending, until it either breaks or is made soluble through reforms.