Connecticut is considering reinstating an asset test for Medicare Savings Programs. State officials say it will save money while program enrollees are worried about losing coverage and experiencing higher health care costs.
As a Medicare enrollee for the past 20 years, Nathalie Taranto said she gets frustrated every time there are proposed changes to the program.
At 85 years old, Taranto doesn't want to spend so much time worrying about how her health care coverage will change. But she does.
“It’s so hard aging because you can’t relax for a minute,” she said at her Easton home. “You have to constantly keep on top of the changes, and it just makes it very difficult.”
Taranto is one of thousands of Connecticut older residents who may be impacted if the state creates an asset test for the Medicare Savings Program, which helps low-income seniors afford health care costs.
Gov. Ned Lamont’s proposed budget for the next two fiscal years includes the reinstatement of an asset test that will look how much enrollees have in property and investments. Seniors would have to own under a certain amount in order to qualify for the savings program.
Connecticut had an asset test for the programs prior to fiscal year 2010.
For people like Taranto, it would mean she would become ineligible. She said she would have to use retirement money she worked to save for, and it wouldn’t last long.
“My late husband and I started planning our retirement way back in the early 60s,” Taranto said. “Well nobody thought that the cost of living, particularly medical care and medicine, would be as expensive as it is now.”
Medicare Savings Programs help residents afford health care costs like copays, deductibles and other out-of-pocket charges. The program is funded by Medicaid, which means it costs the state money.
An asset test would assess people’s savings and checking accounts, stocks and bonds. Individuals would need to own less than $7,560 and couples less than $11,340 to qualify for the savings program.
Assets that do not count against enrollees include a person’s primary home, one car, a burial plot, up to $1,500 in a burial account, and other household and personal items.
State officials said the programs’ income thresholds would stay the same, calling them generous and the “highest in the country.” They said a test could reduce Connecticut Medicaid spending — as much as $10.5 million in fiscal year 2021.
But Maureen McIntyre, chief executive officer of the North Central Area Agency on Aging, a nonprofit resource and advocacy center for older residents, sees people falling through the cracks.
“Without the infrastructure to catch these folks if they are no longer qualifying, what makes us think that they’re all of a sudden going to find the wherewithal to suddenly afford x, y, and z,” she said.
McIntyre said it's worth looking at the program to make sure it’s running efficiently, and that there may be a legitimate point that there are people on the savings program who shouldn’t be, but they are few compared to the number of people who do need help and will fall just short of the asset thresholds.
“Either way we’re going to have a tough climb on this, and either way, difficult decisions are going to need to be made,” she said, “but let’s at least do the best we can to make sure we’re minimizing the collateral damage to people who really need the program and will have no other options if they are dropped.”
But Melissa McCaw, secretary of the Office of Policy and Management, sees the asset test as a way to catch up to what other states are already doing.
“The governor asked for a benchmarking of key programs, and this is one area where we are an outlier,” she said ahead of Lamont’s budget address last month. “We are one of eight states that does not have an asset test for Medicare Savings Program.”
That isn’t a good enough reason to bring one back to Connecticut, said Anna Doroghazi, associate state director of advocacy and outreach at AARP Connecticut. She said older residents already face higher costs in rent, taxes and energy compared to other parts of the country.
“So anything where we’re telling people to impoverish themselves or not maintain their assets, I think we’re just setting them up to have some bigger consequences and more serious outcomes when they need a home repair, when they need some routine maintenance, when they’re vehicle breaks down and they have to get another car,” Doroghazi said.
The state would have to spend money in administrative and system costs to process the asset test, but officials estimate that the long-term savings would be worth it.
The state Appropriations Committee heard testimony at a public hearing last week on several of the governor's budget recommendations, including the asset test, which would not go into effect until July 1, 2020, when an asset verification system is in place.