Stateline Story

Program Moves Vets From Medicaid

Rolla Riley fought Japanese troops on Iwo Jima during World War II in the same famous battle that saw fellow Marines plant an American flag atop Mount Suribachi.

For many years, the 88-year-old veteran's only income - Social Security and veteran's disability benefits - went to pay for nursing home care in Yakima, Wash. The state of Washington's Medicaid program also picked up the bulk of the tab.

But now, thanks to a state program that determines if veterans who receive long-term care and other Medicaid benefits actually qualify for certain veteran's benefits, the U.S. Department of Veterans Affairs (VA) pays for Riley's care. His wife gets more of his money, and the state more of its own.

"I think he's paid a lot of dues, so what he's getting is certainly deserving," said Alan Abel, Riley's stepson.

As states are forced to tighten their belts, more might look to Washington state's program that transfers the cost of eligible veterans' health care, particularly long-term care, from Medicaid to the federal VA system. Medicaid is a joint federal-state program that provides medical coverage and nursing home care for the poor. Although the federal government picks up 57 percent of the program's cost, it's still one of the biggest items in state's budgets.

In Washington, it's the state's second biggest expenditure; the state spent almost $2.8 billion of its dollars on Medicaid in 2007. But the veterans' program is helping to save a small amount of that money. By June, the two-person office within the state Department of Social and Health Services will have saved the state more than $16.2 million since the project went statewide in 2003. It has transferred about 4,400 veterans and their dependents from Medicaid to VA or U.S. Department of Defense care.

Not only that, but veterans also receive better benefits from the VA than Medicaid - and in many instances, they are not even aware they qualify for such care, Bill Allman, the manager and founder of the Veterans Benefit Enhancement project, said

"It's the right thing to do, to give citizens access to coverage that they're eligible for," said Allman, himself a Vietnam veteran. "The fact that you save state dollars, that's a bonus."

Administrators in several states have contacted Allman with questions about how they could set up comparable programs. California will have pilot program running in San Diego, San Bernardino and Fresno counties by July. The state's Legislative Analyst's Office has estimated that California could one day save up to $250 million by shifting about 144,000 veterans from Medicaid to VA health care.

The program relies on the federal Public Assistance Reporting Information System (PARIS) database. Every state sends information to PARIS except Hawaii, which will be required to join the program by October.

Every quarter, PARIS sends participating states the Social Security numbers of individuals receiving social services, such as Medicaid, welfare, food stamps or veterans' benefits, including disability payments and pensions. This allows states to see if someone receiving benefits from their state is also receiving other state or federal benefits.

Using PARIS, Allman's program identifies Medicaid clients who are also veterans. Then his group works with the state VA to determine which veterans are eligible for VA benefits. In order for the VA to pay for the long-term care of a veteran or his widow, for example, the veteran must have at least a 70 percent service-connected disability.

The program saves the state money mainly by shifting the cost of veterans' long-term care to the federal government and by learning which veterans are eligible for more VA cash benefits. So far, that has helped the state's poor veterans who may not qualify for VA-financed nursing home care to pay an average of $450 more per month themselves, easing the state's Medicaid burden.

"Now they can say, 'well, because of my military service, the VA is taking care of me.' It's something they can say proudly," said Alex Deluao of the Washington Department of Veterans Affairs.

Tags: Health