BY HAROLD POLLACK; Washington Post | April 22, 2014
Imagine that you are a young woman expecting your first child. Then you get into an awful crash that leaves you in a wheelchair. Or imagine that you suffer a high school wrestling injury that results in quadriplegia. Or imagine that you are intellectually disabled or living with severe mental illness, and you require long-term services and supports. If you have been reading my work, you might do more than imagine, since each of these stories involves real people who have experienced the best and the worst of what our American medical welfare state offers.
Medicaid plays a crucial role in each story. Of course the program has familiar shortcomings. Long-standing administrative challenges, ideological polarization over health reform perpetuate these difficulties. So does our nation’s tenuous commitment to the well-being of disadvantaged citizens.
On occasion, though, disability policy provides a welcome exception to this depressing pattern. Going back to the 1950s, liberal Democrats, conservative Republicans, and others in-between have made essential contributions, helping millions of people live happier, more productive, and fuller lives. My family is certainly quite grateful for the help provided to my brother-in-law Vincent, who requires a variety of Medicaid-financed services to address his Fragile X syndrome. Medicaid is essential in his life, and in the lives of 8.8 million other non-elderly Americans who live with significant disabilities.
Medicaid does have one huge flaw, which hurts millions of people living with disabilities, injuries, or chronic illness. You have to live, officially at least, as a pauper. With important variations across the states, most recipients are forbidden from having more than two or three thousand dollars in the bank.
You can generally keep your house or your car. That’s pretty much it. You can’t have that emergency fund on hand in case the muffler or the furnace breaks. And what about the stuff Medicaid doesn't cover? It’s nice to get your teeth cleaned or just to buy a Big Mac every once in awhile. Because of such means-testing, that new mother is forbidden from setting any money aside for her child’s education. That food services worker living with intellectual disabilities can’t save up for a nice vacation.
Then there’s retirement. As Joe Entwisle put things:
"The reality for someone in my situation is that retirement usually isn’t an option. You work until you die, literally. A friend of mine is a perfect example. It’s almost creepy the similarities in our life. Both of us had a spinal cord injury at 16. Both of us were injured wrestling. Both of us are policy analysts. He’s a really good guy. He’s 63 years old. He started working for the state many years ago. Yet because of the odd rules around Medicaid eligibility and the differential treatment of earned and unearned income, he literally cannot retire. He knows he has to work until he’s dead or until some rules change. As soon as he starts to draw [retirement income], he’s not going to be eligible for health-care programs or he’ll have to spend down to essentially $710 a month. He could no longer afford his house. He could no longer afford even the taxes on the house."
The current system has other problems, too. First, there is the ironic class bias that so often accompanies complicated rules. If your caregiver happens to be a University of Chicago professor, you have access to skilled lawyers who can draw up the proper wills and special needs trusts to side-step many official requirements.
Families with less financial or social capital often go without. Others dangerously improvise. Maybe an octogenarian parent leaves all of her money to her oldest son, with an implicit understanding that he’ll use half of these funds for his younger sister. Suppose he gets divorced or misuses the money? How many other ways can this go wrong? Means-testing encourages families to cut corners. Worse, it hinders precisely the long-term planning that every person with a disability and every family should do.
These requirements seem especially strange in the wake of health reform. If you’re on Medicaid because you had a spinal cord injury, you face punishing limitations on your allowable financial assets. If you qualify for Medicaid on the basis of low-income, you don’t face the same limitations. There’s no real justification for this inconsistency. Its one virtue may be that it could prove politically generative, in promoting beneficial reforms. It’s hard to believe that the disability community or the American public will long tolerate this discrepancy.
Things are already beginning to move.
The Achieving a Better Life Experience (ABLE) Act of 2013 provides one example. The ABLE Act was introduced last year, and it’s on the legislative agenda again this year. Identical versions are co-sponsored by seventy senators and by 359 members of the House. Pennsylvania Democrat Robert Casey, Jr. and his Republican counterpart Richard Burr introduced the Senate bill. Representatives Ander Crenshaw, Chris Van Hollen, Cathy McMorris Rodgers, and Pete Sessions introduced the counterpart House bill. It’s amazing to see Senators Bernie Sanders, Jay Rockefeller, Mitch McConnell, and James Imhofe co-sponsoring the same bill.
John Rizzo, press secretary to Senator Casey, told me that he anticipates a vote in the coming weeks. Sponsors are waiting for the Congressional Budget Office to issue a budget score. Once that happens, Rizzo is optimist that the bill can become law in the next few months.
I’m sure ABLE accounts will bring some complicated financial mechanics, but the concept behind them is simple. These allow people living with disabilities to establish accounts similar to the 529 educational accounts that many of us have established for our kids. The balance of these ABLE accounts, and their investment returns, can be used for educational expenses, housing, transportation, assistive technologies, and other basic needs.
For many people, this reduces the need for complicated record-keeping and paperwork. It’s cheaper and easier than the complicated special needs trusts many of us have spent thousands of dollars to create and manage. It provides tax advantages. It legitimates what families are often already doing in less transparent and efficient ways. It doesn’t address retirement and some other key issues, but it’s very helpful.
It’s hard to oppose that, wherever you reside on the political spectrum. As Senator Robert Casey put things over email:
"The best advocates for this bill are the people who are dealing with these challenges like Sara Wolff of Northeastern Pennsylvania. When people like Ms. Wolff, who has Down syndrome, talk about the challenges they face and the dreams they have for their lives it inspires action. Further, Democrats and Republicans have rallied behind the ABLE Act because it is a commonsense approach that uses a proven model--the 529 account."
The decidedly middle-class shading helps to explain this bill’s broad support. The engineer whose youngest son lives with Down syndrome immediately sees the value of an account like this. She also has the cash to put in it.
ABLE accounts are less useful to some of my brother-in-law’s peers. Some come from very poor families. For others, ABLE accounts just come too late. They have outlived their intimate caregivers or at least these relationships. Many live entirely on federal disability benefits and nutrition assistance. Under typical terms in many settings, almost all of these benefits are signed over to the group homes and other facilities in which they live. Residents get to keep $50 per month for all of their discretionary expenses from dental visits to the occasional tee shirt, movie ticket, or McDonald’s hamburger.
Here in Illinois, 23,000 children and adults are somewhere on the long waiting list for in-home services, residential placement and other services. These families require more generous benefits more than they need 529-style accounts. And that’s a heavier financial and political lift. Others live in states with other difficulties. Rizzo notes that Senator Casey has encouraged Pennsylvania to embrace the Affordable Care Act’s Medicaid expansion to address poverty-related issues more effectively.
Although more remains to be done, the ABLE Act promises to be a humane and valuable contribution to public policy. In an era disfigured by mean-spirited and polarized gridlock politics, this is no little thing.