Medicaid Buy-In For Working People With Disabilities

States can extend Medicaid coverage to certain disabled people who work. Under Section 4733 of the Balanced Budget Act of 1997, States have the option to provide Medicaid to working people with disabilities whose earnings are too high for them to qualify for Medicaid under existing rules. A person may qualify if he or she:

• Is in a family whose net income is less than 250 percent of the national poverty level for its size (i.e., the poverty limit for a family of three is $16,090 in 2005, so the limit for this program is $40,225).
  
  
• Meets the definition of "disabled" under the Social Security Act and would be eligible for Supplemental Security Income (SSI) payments if it were not for his or her earnings.

A person is not required to be receiving SSI in order to be eligible under the Medicaid provision. However, if not an SSI recipient, the State decides if he or she is disabled.

The fact that the individual is working will not be considered when making the disability decision for this law.

Here is an example of how this provision could work.

The Federal poverty level for an individual is $9,570 in 2005. The net income test for help under this provision is income of less than 250 percent of the Federal poverty level, ($23,925). Joe Green's gross annual earnings are $42,765. After the SSI earned income exclusions, he meets the net income test for Medicaid and is eligible under this provision, as follows:

In this example, Mr. Green's net income of $20,872.44 is below $23,925 limit for an individual.

The Ticket to Work and Self-Sufficiency Program is the centerpiece of new legislation (signed into law by President Clinton in December 1999) under the Ticket to Work and Work Incentives Improvement Act of 1999. This law includes several important opportunities for people who receive Social Security disability benefits who want to go to work.

Effective October 1, 2000, one of the provisions of this new law expands States' options under Medicaid.

• States can cover working individuals with disabilities who are at least age 16, but less than 65 years of age using income and resource limits set by the State, and
  
  
• States can provide Medicaid to employed individuals covered under the group described above, who lose that coverage due to medical improvement, but who still have a medically determinable severe impairment.
  

The Social Security Administration and the Center for Medicare and Medicaid Studies (CMS) are encouraging States to participate in this new program and has information on the State Medicaid Buy-In program. (This link will open in a new window.)

How to Apply

To apply for assistance under this new rule, you should first contact the State Medicaid office in your area to find out if your State participates or plans to participate.