Medicare Savings Programs
Results of Social Security Administration's 2002 Outreach to Low-Income Beneficiaries
Gao ID: GAO-04-363 March 26, 2004
To assist low-income beneficiaries with their share of premiums and other out-of-pocket costs associated with Medicare, Congress has created four Medicare savings programs. Historic low enrollment in these programs has been attributed to several factors, including lack of awareness about the programs, and cumbersome eligibility determination and enrollment processes through state Medicaid programs. Concerned about this low enrollment, Congress passed legislation as part of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA) requiring the Social Security Administration (SSA) to notify low-income Medicare beneficiaries of their potential eligibility for Medicare savings programs. The statute also required GAO to study the impact of SSA's outreach effort. GAO examined what outreach SSA undertook to increase enrollment, how enrollment changed following SSA's 2002 outreach, and how enrollment changed in selected states following SSA's outreach and what additional outreach efforts these states undertook. GAO reviewed information obtained from SSA and the Centers for Medicare & Medicaid Services (CMS), analyzed enrollment data provided by SSA and CMS, and interviewed officials in and obtained data from six selected states (Alabama, California, Louisiana, New York, Pennsylvania, and Washington).
In response to a statutory requirement, SSA is carrying out an annual outreach effort to help increase enrollment in Medicare savings programs. This outreach effort consists of mailing letters to potentially eligible lowincome beneficiaries nationwide as well as sharing data with states to assist with their supplemental outreach efforts. In 2002, SSA sent 16.4 million letters to low-income Medicare beneficiaries whose incomes from Social Security and certain other federal sources met the income eligibility criteria for Medicare savings programs. The 2002 letters provided eligibility criteria for programs in the beneficiary's home state and urged beneficiaries interested in enrolling to call a state telephone number provided. In addition to sending these letters, SSA provided states with a data file containing information on the beneficiaries to whom it sent letters. In 2003, SSA sent another 4.3 million letters to potentially eligible beneficiaries, and indicated that it intends to repeat the outreach mailing annually to newly eligible beneficiaries and a portion of prior letter recipients. Following SSA's outreach efforts in 2002, GAO estimated that more than 74,000 additional eligible beneficiaries enrolled in Medicare savings programs, 0.5 percent of all 2002 letter recipients, than would have likely enrolled without the letter. CMS enrollment data also showed that growth in Medicare savings programs enrollment for the year following SSA's mailing was nearly double that for each of the 3 prior years. Of the 74,000 additional enrollees, certain states and demographic groups had somewhat larger increases in enrollment than other groups. The highest additional enrollment increase was in Alabama, where 2.9 percent of letter recipients enrolled, followed by Delaware at 2.0 percent. Beneficiaries less than 65 years old, persons with disabilities, racial and ethnic minorities, and residents in southern states also had higher enrollment rates than other groups. The percentage of letter recipients newly enrolling in Medicare savings programs following SSA's 2002 mailing ranged from 0.3 to 2.9 percent among the six states GAO reviewed. The varying effects on enrollment by state could be attributable to several factors, including the share of eligible beneficiaries enrolled in Medicare savings programs prior to the outreach, each state's ability to handle increased call and application volume, and a state's income and asset limits. Four states GAO reviewed reported increases in the numbers of calls received or applications mailed or received following the SSA mailing and then decreases after the mailing period ended. Each of the states GAO reviewed reported that the state or other stakeholders conducted additional outreach during SSA's 2002 outreach. SSA generally agreed with GAO's findings. CMS stated that it did not have specific comments on the report.
GAO-04-363, Medicare Savings Programs: Results of Social Security Administration's 2002 Outreach to Low-Income Beneficiaries
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Report to Congressional Committees:
United States General Accounting Office:
GAO:
March 2004:
Medicare Savings Programs:
Results of Social Security Administration's 2002 Outreach to Low-Income
Beneficiaries:
Outreach to Low-Income Medicare Beneficiaries:
GAO-04-363:
GAO Highlights:
Highlights of GAO-04-363, a report to congressional committees
Why GAO Did This Study:
To assist low-income beneficiaries with their share of premiums and
other out-of-pocket costs associated with Medicare, Congress has
created four Medicare savings programs. Historic low enrollment in
these programs has been attributed to several factors, including lack
of awareness about the programs, and cumbersome eligibility
determination and enrollment processes through state Medicaid
programs. Concerned about this low enrollment, Congress passed
legislation as part of the Medicare, Medicaid, and SCHIP Benefits
Improvement and Protection Act of 2000 (BIPA) requiring the Social
Security Administration (SSA) to notify low-income Medicare
beneficiaries of their potential eligibility for Medicare savings
programs. The statute also required GAO to study the impact of SSA‘s
outreach effort. GAO examined what outreach SSA undertook to increase
enrollment, how enrollment changed following SSA‘s 2002 outreach, and
how enrollment changed in selected states following SSA‘s outreach and
what additional outreach efforts these states undertook.
GAO reviewed information obtained from SSA and the Centers for
Medicare & Medicaid Services (CMS), analyzed enrollment data provided
by SSA and CMS, and interviewed officials in and obtained data from
six selected states (Alabama, California, Louisiana, New York,
Pennsylvania, and Washington).
What GAO Found:
In response to a statutory requirement, SSA is carrying out an annual
outreach effort to help increase enrollment in Medicare savings
programs. This outreach effort consists of mailing letters to
potentially eligible low-income beneficiaries nationwide as well as
sharing data with states to assist with their supplemental outreach
efforts. In 2002, SSA sent 16.4 million letters to low-income Medicare
beneficiaries whose incomes from Social Security and certain other
federal sources met the income eligibility criteria for Medicare
savings programs. The 2002 letters provided eligibility criteria for
programs in the beneficiary‘s home state and urged beneficiaries
interested in enrolling to call a state telephone number provided. In
addition to sending these letters, SSA provided states with a data
file containing information on the beneficiaries to whom it sent
letters. In 2003, SSA sent another 4.3 million letters to potentially
eligible beneficiaries, and indicated that it intends to repeat the
outreach mailing annually to newly eligible beneficiaries and a
portion of prior letter recipients.
Following SSA‘s outreach efforts in 2002, GAO estimated that more than
74,000 additional eligible beneficiaries enrolled in Medicare savings
programs, 0.5 percent of all 2002 letter recipients, than would have
likely enrolled without the letter. CMS enrollment data also showed
that growth in Medicare savings programs enrollment for the year
following SSA‘s mailing was nearly double that for each of the 3 prior
years. Of the 74,000 additional enrollees, certain states and
demographic groups had somewhat larger increases in enrollment than
other groups. The highest additional enrollment increase was in
Alabama, where 2.9 percent of letter recipients enrolled, followed by
Delaware at 2.0 percent. Beneficiaries less than 65 years old, persons
with disabilities, racial and ethnic minorities, and residents in
southern states also had higher enrollment rates than other groups.
The percentage of letter recipients newly enrolling in Medicare
savings programs following SSA‘s 2002 mailing ranged from 0.3 to 2.9
percent among the six states GAO reviewed. The varying effects on
enrollment by state could be attributable to several factors,
including the share of eligible beneficiaries enrolled in Medicare
savings programs prior to the outreach, each state‘s ability to handle
increased call and application volume, and a state‘s income and asset
limits. Four states GAO reviewed reported increases in the numbers of
calls received or applications mailed or received following the SSA
mailing and then decreases after the mailing period ended. Each of the
states GAO reviewed reported that the state or other stakeholders
conducted additional outreach during SSA‘s 2002 outreach.
SSA generally agreed with GAO‘s findings. CMS stated that it did not
have specific comments on the report.
www.gao.gov/cgi-bin/getrpt?GAO-04-363.
To view the full product, including the scope and methodology, click
on the link above. For more information, contact Kathryn G. Allen at
(202) 512-7118.
[End of section]
Contents:
Letter:
Results In Brief:
Background:
SSA Is Conducting an Annual Outreach Effort Targeted to Low-Income
Medicare Beneficiaries:
Medicare Savings Program Enrollment Increased by More than 74,000
Beneficiaries Following the 2002 SSA Mailing:
Enrollment Increases Varied among Selected States We Reviewed, with
Several Reporting Increased Calls and Applications Concurrent with SSA
Mailing:
Agency and State Comments:
Appendix I: Methodology:
Appendix II: SSA 2002 Outreach Letter:
Appendix III: Medicare Savings Program Enrollment following 2002 SSA
Mailing by State:
Appendix IV: Medicare Savings Program Enrollment following 2002 SSA
Mailing by Demographic Group:
Appendix V: Comments from the Social Security Administration:
Related GAO Products:
Tables:
Table 1: Medicare Coverage and Beneficiary Cost Sharing for 2003:
Table 2: Medicaid and Medicare Savings Programs' Eligibility Criteria
and Benefits for Low-Income Medicare Beneficiaries, 2003:
Table 3: Enrollment in Medicare Savings Programs by Sample Cohort,
December 2002:
Table 4: Medicare Savings Program Enrollment, May 1999 to May 2003:
Table 5: Increase in Enrollment following SSA's Outreach to Targeted
Population in Six Selected States, December 2002:
Table 6: Average Monthly Calls and Applications Related to Medicare
Savings Programs for Four States prior to, during, and/or after SSA's
Mailing Outreach, January 2002 to April 2003:
Figures:
Figure 1: Medicare Savings Programs Enrollment in Two Sample Cohorts of
SSA Letter Recipients, June 2002 through December 2002:
Figure 2: Sample 2002 SSA Letter:
Figure 3: Estimated Percentage Change in Medicare Savings Program
Enrollment Following 2002 SSA Mailing by State, December 2002:
Figure 4: Estimated Percentage Change in Medicare Savings Program
Enrollment Following 2002 SSA Mailing by Demographic Group, December
2002:
Abbreviations:
BIPA: The Medicare, Medicaid, and SCHIP Benefits Improvement and
Protection Act of 2000:
CMS: Centers for Medicare & Medicaid Services:
FPL: federal poverty level:
MBR: Master Beneficiary Record:
QDWI: Qualified Disabled and Working Individuals:
QI: Qualifying Individuals
QMB: Qualified Medicare Beneficiaries:
SLMB: Specified Low-Income Medicare Beneficiaries:
SSA: Social Security Administration:
SSI: Supplemental Security Income:
United States General Accounting Office:
Washington, DC 20548:
March 26, 2004:
Congressional Committees:
Medicare provides health insurance coverage for a broad array of
services, including hospital, physician, home health, and other
services, to more than 40 million Americans who are elderly, disabled,
or have end-stage renal disease. Medicare beneficiaries pay a portion
of the program's costs through cost-sharing provisions--including
premiums, deductibles, and coinsurance--that can be difficult to afford
for low-income beneficiaries. To assist low-income beneficiaries,
Congress has created several Medicare savings programs that help pay
for some or all of Medicare's cost-sharing provisions. There are four
Medicare savings programs, each with differing income eligibility
requirements and levels of benefits--the Qualified Medicare Beneficiary
(QMB), Specified Low-Income Medicare Beneficiary (SLMB), Qualifying
Individual (QI), and Qualified Disabled and Working Individual (QDWI)
programs. To enroll, eligible beneficiaries must have incomes and
assets within the specific program's federal ceilings and enroll
through their state Medicaid program, the joint federal state program
that covers health care services for certain individuals with low
incomes and resources. States may have less restrictive income and
asset requirements that eligible beneficiaries meet to qualify. As of
September 2003, about 6.2 million beneficiaries were enrolled in
Medicare savings programs.
We reported in 1999 that 43 percent of beneficiaries eligible for the
QMB and SLMB programs were not enrolled.[Footnote 1] More recent
studies also have reported low enrollment rates.[Footnote 2] Low
program enrollment has been attributed to several factors, including a
lack of awareness about the programs, ineffective outreach, a
cumbersome eligibility determination and enrollment process that varies
among state Medicaid programs, and perceived stigma among some
potentially eligible beneficiaries about enrolling in a program for
low-income people.
Concerned about low enrollment in Medicare savings programs, Congress
passed legislation in 2000 requiring the Social Security Administration
(SSA) to conduct outreach to low-income Medicare beneficiaries to
notify them of their potential eligibility for Medicare savings
programs.[Footnote 3] SSA began notifying beneficiaries in response to
the statutory requirement in 2002. The statute also required us to
study the impact of SSA's outreach.[Footnote 4] As agreed with the
committees of jurisdiction, this report addresses the following
questions:
* What outreach has SSA undertaken to increase enrollment in Medicare
savings programs in response to the statutory requirement?
* How did enrollment in the Medicare savings programs change following
SSA's 2002 outreach to potential beneficiaries?
* How did enrollment in these programs change in selected states
following SSA's outreach, and what outreach efforts did these selected
states also undertake?
To examine SSA's response to the statutory requirement for outreach to
eligible low-income Medicare beneficiaries, we obtained relevant
documents and interviewed officials from SSA and the Centers for
Medicare & Medicaid Services (CMS), the federal agency responsible for
administering the Medicare savings programs. To determine how
enrollment in Medicare savings programs changed following SSA's
outreach, we analyzed records from SSA's Master Beneficiary Record
(MBR)--a database that contains the administrative records of Social
Security beneficiaries, including payments for Medicare premiums--and
we report the additional enrollment following the 2002 SSA outreach
that was beyond what would have likely occurred in the absence of SSA's
outreach. We estimated the additional enrollment increase following the
SSA mailing to all letter recipients.[Footnote 5] We analyzed these
enrollment changes at the national level as well as separately for all
states[Footnote 6] and several demographic groups, such as
beneficiaries less than 65 years of age or in certain minority groups.
Any difference in increased enrollment among state or demographic
groups that we report was statistically significant at a 95 percent
confidence level. We also obtained CMS's national enrollment data for
the Medicare savings programs and compared enrollment trends before and
after the SSA outreach. Whereas the SSA MBR data we analyzed are
specific to those beneficiaries who were sent SSA's mailing, the CMS
data also included existing beneficiaries and are not limited to the
beneficiaries who were sent SSA's mailing. To assess how SSA's outreach
affected enrollment in selected states and what outreach efforts these
states undertook, we interviewed officials and collected data from six
states--Alabama, California, Louisiana, New York, Pennsylvania, and
Washington. We selected these states based on several factors,
including their different levels of change in overall Medicare savings
programs enrollment from 2002 to 2003, geographic diversity, relatively
large populations of Medicare savings programs enrollees, and
availability of data on their program enrollment. It was beyond the
scope of our work to examine the effectiveness of any outreach
performed by states or CMS separately from SSA's outreach. In
conducting our analyses, we obtained information from SSA and CMS on
reliability checks they made on the data and any data limitations
provided to us, and concluded that their data were sufficiently
reliable for our analysis. Appendix I provides more detailed
information on our methodology. We performed our work from February
2003 through March 2004 in accordance with generally accepted
government auditing standards.
Results In Brief:
In response to a statutory requirement in the Medicare, Medicaid, and
SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), SSA is
carrying out an annual outreach effort to help increase enrollment in
Medicare savings programs. This outreach effort consists of mailing
letters to all low-income Medicare beneficiaries nationwide who were
not enrolled in Medicare savings programs at the time the letters were
sent as well as sharing data with states to assist with any state
outreach efforts. From May through November 2002, SSA sent 16.4 million
letters to low-income Medicare beneficiaries whose incomes from Social
Security and certain other federal sources met the income eligibility
criteria for Medicare savings programs. Because SSA does not have
complete information on beneficiaries' income and assets, however, many
of these beneficiaries could have had other income or assets that would
exceed the program's eligibility criteria, thus reducing the number of
eligible beneficiaries. The 2002 letters provided eligibility criteria
for the Medicare savings program in the beneficiary's home state and
urged beneficiaries interested in enrolling to call a state telephone
number provided. In addition to sending these letters, SSA provided
states with a data file containing information on the beneficiaries to
whom it sent letters. From June through October 2003, SSA sent 4.3
million letters to potentially eligible beneficiaries, including
beneficiaries newly eligible for Medicare savings programs as well as a
portion of those who had been sent the 2002 letter but who had not
enrolled. SSA indicated that it intends to annually repeat the outreach
mailing to potentially eligible beneficiaries.
Following SSA's outreach efforts in 2002, we estimated that more than
74,000 additional eligible beneficiaries enrolled in Medicare savings
programs than would have likely enrolled without the letter. This
represents about 0.5 percent of all letter recipients. Further, CMS
data showed that overall enrollment growth in Medicare savings programs
nationwide for the year following SSA's mailing was nearly double each
of the 3 prior years. Thirty-five states had a statistically
significant additional increase in enrollment nationwide following the
SSA mailing, with the largest increases in Alabama (2.9 percent) and
Delaware (2.0 percent). Beneficiaries less than 65 years old, persons
with disabilities, racial and ethnic minorities, and residents in
southern states had higher additional enrollment rates than other
groups.
Additional enrollment in Medicare savings programs varied significantly
among the six states we reviewed, ranging from 0.3 percent in
California, Washington, and New York to a high of 2.9 percent in
Alabama. The varying effects on enrollment by state could be
attributable to several factors, including the share of eligible
beneficiaries already enrolled in Medicare savings programs prior to
the outreach, a state's ability to handle increased call and
application volume, and a state's income and asset limits. Four states
we reviewed reported significant increases in the numbers of calls
received by their hot lines related to Medicare savings programs and
applications mailed or received during the SSA mailing and then
decreases after the SSA mailing period ended. Each of the states we
reviewed reported that the state or other stakeholders, such as
community organizations that advocate for low-income elderly or private
health plans that participated in Medicare, supplemented SSA efforts
with additional outreach that may have also contributed to increased
interest and enrollment in Medicare savings programs.
In commenting on a draft of this report, SSA generally agreed with our
findings and noted that improvements in state enrollment processes
could further increase enrollment. CMS stated that it did not have
specific comments on the report. Louisiana noted that, in comparison to
its experience in 2002, it observed little increase in calls following
the 2003 SSA mailing. New York noted that it had a larger increase in
Medicare savings program enrollment overall than we showed in the draft
report. However, we report the increase in enrollment specifically
attributable to the 2002 SSA outreach mailing, not the net increase in
enrollment, which could also be due to factors besides the SSA mailing.
Background:
Medicare covers about 40 million elderly (over 65 years old) and
disabled beneficiaries. Individuals who are eligible for Medicare
automatically receive Hospital Insurance, known as part A, which helps
pay for inpatient hospital, skilled nursing facility, hospice, and
certain home health services. A beneficiary generally pays no premium
for this coverage unless the beneficiary or spouse has worked fewer
than 40 quarters in his or her lifetime, but the beneficiary is liable
for required deductibles, coinsurance, and copayment amounts. Medicare-
eligible beneficiaries may elect to purchase Supplementary Medical
Insurance, known as part B, which helps pay for certain physician,
outpatient hospital, laboratory, and other services. Beneficiaries must
pay a premium for part B coverage, which was $58.70 per month in
2003.[Footnote 7] Beneficiaries are also responsible for part B
deductibles, coinsurance, and copayments. Table 1 summarizes the
benefits covered and cost-sharing requirements for Medicare part A and
part B.
Table 1: Medicare Coverage and Beneficiary Cost Sharing for 2003:
Part A - Hospital insurance.
Part A premium; Beneficiary pays:
No premium if beneficiary or spouse worked at least 40 quarters in
lifetime;
Premium if beneficiary or spouse worked fewer than 40 quarters in
lifetime.
Inpatient hospital; Beneficiary pays:
$840 deductible per benefit period[A];
$210 COPAYMENT PER DAY FOR DAYS 61-90;
$420 copayment per day for days 91-150[B];
All costs beyond 150 days.
Skilled nursing facility[C]; Beneficiary pays:
Nothing for first 20 days;
Up to $105 copayment or less per day for days 21-100;
All costs beyond 100 days in the benefit period.
Home health[D]; Beneficiary pays:
No cost sharing;
20 percent coinsurance for durable medical equipment.
Hospice; Beneficiary pays:
Up to $5 copayment for outpatient drugs;
5 percent coinsurance for inpatient respite care.
Blood; Beneficiary pays:
Cost of first 3 pints.
Part B - Medical insurance[E]:
Part B premium; Beneficiary pays:
$58.70 per month.
Physician and medical; Beneficiary pays:
$100 deductible each year;
20 percent coinsurance for most services;
50 percent coinsurance for outpatient mental health services.
Clinical laboratory; Beneficiary pays:
No cost sharing.
Home health[D]; Beneficiary pays:
No cost sharing;
20 percent coinsurance for durable medical equipment.
Outpatient hospital; Beneficiary pays:
Coinsurance may vary by service and may exceed 50 percent.
Blood; Beneficiary pays:
Cost of first 3 pints;
20 percent coinsurance for additional pints.
Source: CMS.
[A] No deductible is charged for second and subsequent hospital
admissions if they occur within 60 days of the beneficiary's most
recent covered inpatient stay.
[B] After the first 90 days of inpatient care, Medicare will help pay
for an additional 60 days of inpatient care (days 91-150). Each
beneficiary is entitled to a lifetime reserve of 60 days of inpatient
coverage. Each reserve day may be used only once in a beneficiary's
lifetime.
[C] To qualify, a Medicare beneficiary must require daily skilled
nursing or rehabilitative therapy services, generally within 30 days of
a hospital stay of at least 3 days in length, and must be admitted to
the nursing home for a condition related to the hospitalization.
[D] To qualify for services, beneficiaries must be confined to their
homes; have a plan of care signed by a physician; and need intermittent
skilled nursing care (other than solely venipuncture for the purpose of
obtaining a blood sample), physical therapy, speech-language pathology
services, or have a continuing need for occupational therapy services.
[E] No cost sharing is required for certain preventive services,
including specific screening tests for colon, cervical, and prostate
cancer, and flu and pneumonia vaccines.
[End of table]
Many low-income Medicare beneficiaries who cannot afford to pay
Medicareís cost-sharing requirements receive assistance from Medicaid.
For Medicare beneficiaries qualifying for full Medicaid benefits, state
Medicaid programs pay for Medicareís part A (if applicable) and part B
cost-sharing requirements up to the Medicaid payment rate as well as
for services that are not generally covered by Medicare, such as
prescription drugs. [Footnote 8]To qualify for full Medicaid benefits,
beneficiaries must meet their stateís eligibility criteria, which
include income and asset requirements that vary by state. [Footnote
9]In most states, beneficiaries that qualify for Supplemental Security
Income (SSI) automatically qualify for full Medicaid benefits.[Footnote
10] Other beneficiaries may qualify through one of several optional
eligibility categories targeted to low-income beneficiaries,
individuals with high medical costs, or those receiving care at home or
in the community who otherwise would have been institutionalized.
To assist low-income Medicare beneficiaries with their premium and
cost-sharing obligations, Congress established several Medicare
savings programs--the QMB, SLMB, QI, and QDWI programs. Under these
programs, state Medicaid programs pay enrolled beneficiaries' Medicare
premiums. As a result, for QMB, SLMB and QI beneficiaries, Medicare
part B premiums would not be deducted from their monthly SSA checks.
The QMB program also pays Medicare deductibles and other cost-sharing
requirements, thereby saving beneficiaries from having to make such
payments. Beneficiaries eligible for Medicare savings programs can
apply for and be determined to be eligible through their state Medicaid
programs. Thirty-three states have agreements with SSA whereby SSA
makes eligibility determinations for a state if beneficiaries are
deemed eligible by SSA to receive SSI benefits.[Footnote 11] In the
other 18 states, even if an individual is eligible to receive SSI
benefits, an individual must file an application with the state or
local Medicaid agency to be eligible. Beneficiaries qualifying for
Medicare savings programs receive different levels of assistance
depending on their income. See table 2 for eligibility criteria and
benefits for each program.
Table 2: Medicaid and Medicare Savings Programs' Eligibility Criteria
and Benefits for Low-Income Medicare Beneficiaries, 2003:
Program: Medicaid;
Income eligibility criteria[A,B]: Low-income Medicare beneficiaries,
as defined by each state, whose incomes are up to 100 percent of the
federal poverty level;
Benefits: Optional benefits vary by state, but typically include
Medicare part B premiums and Medicaid services, including those not
covered under Medicare.
Program: Medicare savings programs: Qualified Medicare Beneficiary
(QMB);
Income eligibility criteria[A,B]: Medicare beneficiaries whose incomes
are at 100 percent or less of the federal poverty level;
Benefits: Medicare part A[C] (if applicable) and B premiums,
deductibles, and coinsurance paid by state Medicaid program.
Program: Medicare savings programs: Specified Low-Income Medicare
Beneficiary SLMB);
Income eligibility criteria[A,B]: Medicare beneficiaries whose incomes
are above 100 percent but less than 120 percent of the federal poverty
level;
Benefits: Medicare part B premiums paid by state Medicaid program.
Program: Medicare savings programs: Qualifying Individuals (QI)[D];
Income eligibility criteria[A,B]: Medicare beneficiaries whose incomes
are at 120 percent but less than 135 percent of the federal poverty
level;
Benefits: Medicare part B premiums paid by state Medicaid program.
Program: Medicare savings programs: Qualified Disabled and Working
Individuals (QDWI)[E];
Income eligibility criteria[A,B]: Disabled and working Medicare
beneficiaries whose incomes do not exceed 200 percent of the federal
poverty level;
Benefits: Medicare part A premiums paid by state Medicaid program.
Source: CMS.
[A] In 2003, the federal poverty level (FPL) per month was $748 for
individuals and $1,010 for couples in the 48 contiguous states and the
District of Columbia. Higher amounts were specified for Alaska and
Hawaii.
[B] States also have asset limits for individuals to qualify for
Medicaid or Medicare savings programs. These vary by state, but most
often for Medicaid, eligible beneficiaries must have assets no greater
than the limit for SSI, which is $2,000 for individuals and $3,000 for
married couples. SSI resource limits typically exclude the
beneficiary's automobile and house. For Medicare savings programs,
eligible beneficiaries typically must have assets no greater than twice
the limit for SSI.
[C] Medicare part A premiums are covered under the QMB program for
beneficiaries who worked fewer than 40 quarters.
[D] Until December 2002, the QI program, a federal block grant to the
states, consisted of two parts--QI-1 and QI-2. The QI-1 program
(covering beneficiaries with incomes at least 120 percent but less than
135 percent of FPL) and the QI-2 program (covering beneficiaries with
incomes at least 135 percent but less than 175 percent of FPL) were
originally authorized through December 2002. The QI-2 program ended as
originally provided, but the QI-1 program was reauthorized through
September 2004.
[E] These individuals are required to pay part A premiums because they
are no longer entitled to free Medicare part A benefits having
successfully returned to work and exhausted the free Medicare part A
benefits available to them following the end of their disability
benefits.
[End of table]
In 1998, Congress passed legislation specifically providing funding for
SSA to evaluate ways to promote Medicare savings programs.[Footnote 12]
In response, SSA conducted demonstration projects to explore the
effects of using various approaches to increase participation in
Medicare savings programs. In one of these demonstrations conducted in
1999 and 2000, SSA tested six models designed to increase awareness and
reduce barriers to enrollment. The models were implemented at 20 sites
in 10 states, as well as the entire state of Massachusetts. The models
differed in the extent to which SSA was involved in outreach efforts
beyond mailing the letters. For example, in the "application model,"
SSA staff screened beneficiaries if they appeared to be eligible,
completed applications, collected supporting documents, and forwarded
the completed application form and supporting evidence to the state
Medicaid agency for an eligibility determination. In the "peer
assistance model," Medicare beneficiaries contacted an AARP toll-free
number and were screened for program eligibility by an AARP
volunteer.[Footnote 13] Across all six models, SSA sent more than
700,000 letters informing low-income Medicare beneficiaries that they
may be eligible for benefits under the Medicare savings programs. The
enrollment rate for each model varied--ranging from an additional 7
enrollees per 1,000 letters to 26 enrollees per 1,000 letters--with the
application model recording the highest enrollment rate and peer
assistance recording the lowest.[Footnote 14]
In 2000, Congress amended the Social Security Act, through BIPA,
requiring the Commissioner of Social Security to notify eligible
Medicare beneficiaries about assistance available from state Medicaid
programs to help pay Medicare premiums and cost sharing. BIPA also
required SSA to furnish each state Medicaid program with the names and
addresses of individuals residing in the state that SSA determines may
be eligible for the Medicare savings programs. SSA is required to
update such information at least annually.[Footnote 15]
In addition to SSA's outreach efforts, CMS and individual states have
engaged in efforts to increase enrollment in Medicare savings programs.
Since fiscal year 2002, CMS has included increasing awareness of the
Medicare savings programs as one of its Government Performance and
Results Act (GPRA) goals.[Footnote 16] Specifically, CMS's goal in
fiscal year 2002 was to develop a baseline to measure awareness of
Medicare savings programs and to set future targets for increasing
awareness. CMS estimated that 11 percent of beneficiaries were aware of
Medicare savings programs in 2002 and the goal was to increase this to
13 percent for fiscal year 2003. As part of its efforts to increase
awareness, CMS has coordinated with states, SSA, and other
organizations regarding various outreach efforts; provided information
about Medicare savings programs in various CMS publications; and
developed a variety of educational materials for targeted populations,
including minorities. CMS efforts in increasing enrollment in earlier
years included setting state-specific enrollment targets and measuring
progress toward these enrollment targets; developing and disseminating
training and outreach materials to the states, and sponsoring national
and regional training workshops for a variety of stakeholders,
including other federal and state agencies, health care providers, and
community organizations; designing a model application for Medicare
savings programs that states can consider adopting; and providing grant
funding to state Medicaid agencies, state health insurance assistance
programs, and national advocacy groups to test and promote innovative
approaches to outreach.
In 2001, CMS also contracted for a survey of states to identify
activities undertaken to increase program enrollment and streamline
administration of these programs. Some of the most common state efforts
included allowing application by mail (49 states), eliminating in-
person interviews (46 states), developing a shorter application form
(43 states), and conducting outreach presentations at health fairs (34
states). Other state efforts identified by the survey included:
* increasing awareness of the programs through outreach efforts such as
direct mailings and other printed material, and public service
announcements on radio, television, and in newspapers;
* providing training for employees and education for beneficiaries;
* developing partnerships with other entities, such as State Health
Insurance Assistance programs and local agencies on aging, to enhance
outreach efforts and promote issues and solutions involving the
Medicare savings programs;
* eliminating potential barriers to enrollment such as streamlining the
enrollment and renewal process and easing financial eligibility rules;
* supplementing program benefits with other benefits, such as
prescription drug discount programs; and:
* providing information targeting underserved populations, including
minorities.
SSA Is Conducting an Annual Outreach Effort Targeted to Low-Income
Medicare Beneficiaries:
In response to BIPA, SSA is conducting an annual outreach effort to
help increase enrollment in Medicare savings programs. This outreach
consists of a nationwide mailing campaign and data sharing with the
states. SSA selected low-income Medicare beneficiaries to be sent an
outreach letter if their incomes were below the income eligibility
ceilings for the Medicare savings programs. From May through November
2002, SSA sent a total of 16.4 million outreach letters to persons
potentially eligible for QMB, SLMB, and QI. Additionally, in late 2002,
SSA sent about 53,000 letters to those potentially eligible for
benefits under the QDWI program. Starting in 2003, SSA has targeted
annual outreach letters to individuals newly eligible for Medicare as
well as a subset of those who were sent outreach letters in 2002 but
are still not enrolled. From June through October 2003, SSA sent
outreach letters to 4.3 million of these beneficiaries. SSA intends to
continue its outreach mailing annually to potentially eligible
beneficiaries, including recipients who did not enroll after receiving
earlier letters, as well as those whose income has declined, making
them eligible for the program. In addition to sending outreach letters,
in 2002 and 2003 SSA provided states with a data file that listed
residents who were potentially eligible for benefits under the Medicare
savings programs. SSA plans to continue sharing these data once a year
with states. The data provided by SSA could be used by the states to
coordinate their outreach with SSA's or supplement SSA's outreach
efforts.
For the 2002 mailing, SSA sent letters three times each week from May
through November. Each time letters were mailed, SSA sent them to
approximately 207,000 Medicare beneficiaries randomly selected from the
16.4 million beneficiaries who were identified as potentially eligible
for QMB, SLMB, and QI.[Footnote 17] Letters were targeted to
beneficiaries whose incomes from Social Security and certain other
federal sources were less than 135 percent of the federal poverty level
(FPL).[Footnote 18] Specifically, those selected to be sent the
outreach letters were intended to meet the following three criteria:
* individuals and couples entitled to Medicare, or within 2 months of
Medicare entitlement eligibility;
* individuals who were not currently receiving Medicare savings program
benefits under a state Medicaid program or not already entitled to full
Medicaid based on SSI participation; and:
* individuals and couples whose combined Social Security income and
Department of Veterans Affairs and federal civil service pensions fell
below the program's income eligibility ceiling.
The letters provided information in English or Spanish about the
Medicare savings programs, including state-specific asset guidelines
and a state contact number.[Footnote 19] (See app. II for a sample 2002
outreach letter.) At the end of November 2002, SSA sent a separate
mailing to about 53,000 disabled working adults who were potentially
eligible for benefits under the QDWI program.[Footnote 20]
Medicare beneficiaries who had sources of income other than Social
Security--such as income from employment and public and private
pensions--and whose incomes were above the programs' eligibility
thresholds were selected nonetheless to be sent the SSA outreach letter
because SSA's data systems do not collect information on these income
sources. In addition, SSA's records do not contain information about
beneficiaries' private assets, making it impossible for SSA to identify
whether letter recipients had assets within their states' Medicare
savings programs' eligibility limits--typically $4,000 for an
individual and $6,000 for couples.
In 2002, the Medicare Rights Center, a national health advocacy group
for older adults and people with disabilities, sought a federal court
order requiring SSA to resend 1.4 million letters to potentially
eligible beneficiaries in Connecticut and New York to correct erroneous
information on the asset limit for the QI program. The New York and
Connecticut letters had incorrectly informed potential beneficiaries
that only individuals with assets of less than $4,000 were eligible for
the QI program, even though Connecticut and New York abolished the
asset requirement for QI eligibility in 2001 and 2002, respectively.
SSA agreed to resend the letters and the parties settled the case
before trial.
In addition to sending letters to potentially eligible low-income
Medicare beneficiaries, in 2002 SSA provided all but six states with an
electronic data file containing the names of all beneficiaries to whom
it had sent letters in that state.[Footnote 21] The data file contained
information that could assist states with outreach efforts, such as the
name, address, Social Security number, date of birth, spouse's name,
and the basis for Medicare entitlement of each letter recipient. SSA is
required to provide updated data to the states each year.[Footnote 22]
For the June through October 2003 mailing, SSA sent a second round of
letters to about 4.3 million potentially eligible low-income Medicare
beneficiaries nationwide whom its records indicated might have met the
QMB, SLMB, and QI income eligibility criteria and were not currently
enrolled in Medicare savings programs. This mailing included
beneficiaries who were newly eligible since the 2002 mailing, current
Medicare beneficiaries who newly met the income criteria,[Footnote 23]
and about one-fifth of the beneficiaries notified in 2002 who still met
the mailing criteria but were not enrolled in a Medicare savings
program.[Footnote 24] At the time we conducted our work, enrollment
data for beneficiaries who were sent the letter in 2003 were not
available.
In contrast to the 2002 letter that provided state-specific eligibility
criteria and a state-specific telephone number, the 2003 letter did not
contain customized state information, but provided more general
national information. The letter suggested that beneficiaries who may
be eligible check the government list in their local telephone books
for their local Medicaid contact or call the general 1-800-Medicare
number that refers callers to state help lines, such as state or local
medical assistance offices, social services, or welfare offices. SSA
gave several reasons for not including state-specific information in
the 2003 letter. One official indicated that there was additional cost
to SSA to develop state-specific letters and therefore the agency did
not tailor the letters for each state. CMS officials reported that a
few states did not want to provide state-level contact numbers because
eligibility and other Medicare savings program administrative matters
were actually conducted at the county levels. Furthermore, in some
cases, the telephone numbers states initially provided were changed
shortly before the 2002 mailings were begun, creating additional need
for SSA to coordinate with states in finalizing the letters. However,
some state officials we interviewed expressed concern about the lack of
state-specific information for the 2003 mailing. Their concern was
that, given that most states had established mechanisms for responding
to these inquiries for the larger 2002 mailing, not including state-
specific criteria or contact information on the letter could make the
letter less effective since it could be more difficult for
beneficiaries to obtain direct assistance or applications for
eligibility determinations.
Medicare Savings Program Enrollment Increased by More than 74,000
Beneficiaries Following the 2002 SSA Mailing:
We estimate that SSA's mailing from May through November 2002 to 16.4
million potentially eligible beneficiaries contributed to more than
74,000 additional beneficiaries enrolling in Medicare savings programs.
Further, in the year following SSA's mailing, nationwide enrollment in
Medicare savings programs increased 2.4 to 2.9 percentage points over
that in the 3 previous years. Certain demographic groups also had
larger additional increases in enrollment following the 2002 SSA
mailing. For example, beneficiaries less than 65 years old, persons
with disabilities,[Footnote 25] racial and ethnic minorities, and
residents in southern states experienced larger additional increases in
enrollment.
More than 74,000 Additional Beneficiaries Enrolled in Medicare Savings
Programs Following SSA's 2002 Mailing:
On the basis of our analysis of SSA's Master Beneficiary Record (MBR),
we estimate that, of the 16.4 million SSA letter recipients in 2002, an
additional 74,000 beneficiaries (0.5 percent of letter recipients)
enrolled in Medicare savings programs than would have likely enrolled
without the mailing. To estimate this increased enrollment, we examined
two cohorts of letter recipients--a cohort of 1.3 million beneficiaries
who were sent the letters during the first six mailings in May 2002 and
a baseline cohort of 1.3 million beneficiaries who were sent the
letters during the last six mailings through November 2002. Because SSA
sent the mailing to beneficiaries in a random order nationwide from May
through November 2002, the only difference between the cohorts is the
time at which the letters were sent to them. As a result, other factors
that could influence enrollment patterns, such as demographic
differences or other outreach efforts by CMS and the states, should
affect the May and November cohorts similarly. We used the November
2002 cohort as a baseline to examine how the May 2002 cohort's
enrollment in Medicare savings programs was affected following SSA's
mailing.
As shown in figure 1, by August 2002--3 months after the initial
letters were sent in May 2002--the Medicare savings program enrollment
for the May cohort began to increase faster than that of the November
cohort, which was yet to have the SSA letter sent to them. While the
cohorts were sent the SSA letters in May or November 2002, SSA
officials reported that it typically takes about 3 months before
enrollment is reported in the MBR.
Figure 1: Medicare Savings Programs Enrollment in Two Sample Cohorts of
SSA Letter Recipients, June 2002 through December 2002:
[See PDF for image]
[A] The baseline is the cohort that was sent the letter in November
2002.
[End of figure]
As of December 2002, more than 5,800 additional beneficiaries in the
cohort of 1.3 million beneficiaries who were sent the letter in May had
enrolled in Medicare savings programs compared with the November
cohort, whose enrollment was not yet affected by the mailing.[Footnote
26] (See table 3.) This additional enrollment in the May cohort
represents 0.5 percent of the letter recipients. Projecting the
experience of the May cohort to the universe of the 16.4 million letter
recipients results in an estimate of over 74,000 additional
beneficiaries enrolling in Medicare savings programs as a result of the
2002 SSA mailing.
Table 3: Enrollment in Medicare Savings Programs by Sample Cohort,
December 2002:
Number of letter recipients in sample cohort who enrolled;
Cohort that the SSA letter was sent to in May 2002: 30,291;
Baseline cohort[A]: 24,473;
Difference: 5,818.
Percent of letter recipients who enrolled;
Cohort that the SSA letter was sent to in May 2002: 2.4;
Baseline cohort[A]: 1.9;
Difference: 0.5.
Estimated total number of recipients who enrolled;
Cohort that the SSA letter was sent to in May 2002: 386,243;
Baseline cohort[A]: 311,786;
Difference: 74,457.
Source: GAO analysis of SSA MBR data.
Note: Each cohort included 1.3 million letter recipients.
[A] The baseline represents the cohort that was sent the letter in
November 2002 because the effect of the letter was not yet evident
during the period we analyzed.
[End of table]
Nationwide, CMS data showed that Medicare savings programs experienced
an overall net increase in enrollment of 5.9 percent (341,069
individuals) from May 2002--the start of SSA's mailing--to May
2003.[Footnote 27] This 5.9 percent increase was nearly double the 3.0
to 3.5 percent increases in the 3 previous years before SSA's
nationwide mailings. (See table 4.) These data suggest that SSA's
mailing helped to increase enrollment at a greater annual rate than in
earlier years.
Table 4: Medicare Savings Program Enrollment, May 1999 to May 2003:
Month/year: May 1999;
Enrollment: 5,242,378;
Annual change in enrollment: N/A;
Annual percentage Increase: N/A.
Month/year: May 2000;
Enrollment: 5,398,468;
Annual change in enrollment: 156,090;
Annual percentage Increase: 3.0.
Month/year: May 2001;
Enrollment: 5,570,231;
Annual change in enrollment: 171,763;
Annual percentage Increase: 3.2.
Month/year: May 2002;
Enrollment: 5,763,553;
Annual change in enrollment: 193,322;
Annual percentage Increase: 3.5.
Month/year: May 2003;
Enrollment: 6,104,622;
Annual change in enrollment: 341,069;
Annual percentage Increase: 5.9.
Source: GAO analysis of CMS third-party master file.
[End of table]
Certain States and Demographic Groups Had Higher Enrollment Rates
Following SSA's Outreach:
Across the United States, letter recipients residing in the southern
states had a 0.6 percent additional increase in enrollment following
SSA's mailing. This was more than residents in the Northeast, Midwest,
and West, where the additional increase in enrollment was 0.4 percent.
Thirty-five states had an additional increase in enrollment following
the SSA mailing compared to the increase that would likely have
occurred without the letter. Of the thirty-five states, the largest
additional increase in enrollment following the SSA mailing occurred in
Alabama, (2.9 percent), followed by Delaware (2.0 percent), and
Mississippi (1.3 percent). While data from 13 other states showed an
increase in enrollment following the SSA mailing, these increases were
not statistically significant. Another three states showed a decrease
in enrollment following the SSA mailing, but these changes also were
not statistically significant. Appendix III provides the additional
percentage change in enrollment following the 2002 SSA mailing for each
state.
Certain demographic groups also had higher additional increases in
enrollment rates than the additional increase among all letter
recipients. In comparison to the 0.5 percent additional increase in
enrollment among all letter recipients, beneficiaries less than 65
years old and beneficiaries of any age who qualified for Medicare as a
result of a disability each had a 0.8 percent additional increase in
enrollment following SSA's outreach.[Footnote 28] Also, minority
beneficiaries, which based on SSA's data categories include blacks or
individuals of African origin, Asians and Pacific Islanders, and North
American Indians or Eskimos, had a 0.7 percent additional increase in
enrollment. Appendix IV provides data for all demographic groups that
we examined.
Enrollment Increases Varied among Selected States We Reviewed, with
Several Reporting Increased Calls and Applications Concurrent with SSA
Mailing:
The percentage of additional letter recipients newly enrolling in
Medicare savings programs following SSA's mailings varied significantly
among the six states we reviewed. Among these six states, enrollment
increases ranged from 0.3 to 2.9 percent. Further, several states we
reviewed reported that calls to their telephone hot lines and
applications mailed or received increased sharply during the period of
the SSA outreach. In addition, some states supplemented SSA efforts
with outreach efforts of their own, while other states were aware of or
assisted outreach efforts by private or community groups.
SSA Outreach Efforts Had Varying Effects on Enrollment in Selected
States:
Among the states we reviewed, SSA's outreach had varying effects on the
percentage of letter recipients enrolling. Alabama, with 2.9 percent
additional letter recipients enrolled compared to the percentage that
likely would have enrolled without the SSA letter, had the largest
additional increase in enrollment following the SSA mailing. This
contrasts with the national average of 0.5 percent. For the states we
reviewed, SSA's outreach had the least impact on Medicare savings
program enrollment in California, Washington, and New York with a 0.3
percent increase in additional enrollment. (See table 5.):
Table 5: Increase in Enrollment following SSA's Outreach to Targeted
Population in Six Selected States, December 2002:
State: Alabama;
Percentage of additional letter recipients enrolling following SSA
mailing: 2.9.
State: Louisiana;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.9.
State: Pennsylvania;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.4.
State: California;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.3.
State: Washington;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.3.
State: New York;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.3.
State: All States;
Percentage of additional letter recipients enrolling following SSA
mailing: 0.5.
Source: GAO analysis of SSA's Master Beneficiary Record.
[End of table]
The varying effects on enrollment by state can be attributed to several
factors, including, the share of eligible beneficiaries already
enrolled in Medicare savings programs prior to the outreach, a state's
ability to handle increased phone calls and applications, and a state's
income and asset limits. For example, a smaller share of low-income
elderly beneficiaries in Alabama was enrolled in QMB as of the year
prior to the SSA mailing than the national average. Specifically, the
number of QMB enrollees in Alabama in 2001 was about half the number of
Alabama seniors reported by the Census Bureau to have incomes below the
limit for the QMB program. In contrast, about three-quarters of the
seniors nationwide who reported income below the QMB limit were
enrolled. As a result, a larger number of letter recipients in Alabama
may have been able to meet the QMB and other Medicare savings program
eligibility criteria whereas other states may have already enrolled a
larger share of these beneficiaries. Further, each of the states we
reviewed established or used an existing state-specific telephone
number that was listed in the SSA letter to receive calls. After the
SSA mailing started, however, California's phone number was
discontinued and calls were redirected to CMS's nationwide 1-800-
Medicare number. California's lower enrollment could also result from
its eligibility requirements for SSI. For example, in a prior
demonstration, SSA's mailing in 1999 and 2000 resulted in lower
enrollment in California than in other demonstration sites, in part
because the state offered a generous state supplement to SSI.
Therefore, there were potentially not as many people eligible for the
Medicare savings programs.[Footnote 29] In addition, other state
differences, such as different state asset eligibility requirements and
application requirements as well as state efforts to support the SSA
outreach, may have contributed to different effects among states.
States Reported Increased Interest in Medicare Savings Programs
Concurrent with SSA and States' Outreach Efforts:
States we reviewed often reported that calls to their hot lines and
applications for Medicare savings programs increased significantly
during the period of the 2002 SSA mailing. Four states provided data on
the monthly trends in the number of calls either related to Medicare
and Medicaid in general or the Medicare savings program specifically
that showed increases concurrent with the 2002 SSA mailing. Three
states were also able to provide data on changes in the number of
applications sent to interested beneficiaries or received from
beneficiaries. (See table 6.) While officials in several states
indicated that not all of the increases noted could be attributed
directly to the SSA mailing, the data provided by the states suggest
that beneficiaries' interest in Medicare savings programs increased
during the mailing period. For example, Alabama experienced a 19
percent increase in monthly calls to its state hot line related to any
Medicare and Medicaid issue after the SSA mailings began; this was
followed by a 25 percent decrease after the mailings ended. Alabama
also experienced a 158 percent surge in applications received per month
during the SSA mailing and then a decrease of 57 percent afterwards.
State officials reported that Washington tracked calls and applications
specific to the SSA mailing, and these data showed 85 percent decreases
in both monthly call volume and applications mailed out to
beneficiaries after the mailings ended; Washington also reported a 72
percent monthly decrease in applications received after the 2002
mailings ended.
Table 6: Average Monthly Calls and Applications Related to Medicare
Savings Programs for Four States prior to, during, and/or after SSA's
Mailing Outreach, January 2002 to April 2003:
State: Alabama;
Average monthly calls:
Average monthly calls for any Medicaid or Medicare issue (including
Medicare savings programs):
* Prior to: 25,133;
* During: 30,010 (19 percent increase);
* After: 22,485 (25 percent decrease);
Average monthly applications: Average monthly applications received
related to Medicare (including Medicare savings programs):
* Prior to: 1,474;
* During: 3,802 (158 percent increase);
* After: 1,618 (57 percent decrease).
State: Louisiana;
Average monthly calls:
Average monthly calls for Medicare savings programs:
* Prior to: 301;
* During: 1,849 (515 percent increase);
* After: 516 (72 percent decrease);
Average monthly applications: Average monthly applications mailed for
Medicare savings programs:[A];
* Prior to: 53;
* During: 1,571 (2,865 percent increase);
* After: 226 (86 percent decrease).
Average monthly applications: State: Average monthly applications
received for Medicare savings programs:
* Prior to: 2,131[B];
* During: 2,940 (38 percent increase);
* After: 3,634 (24 percent increase.
State: Pennsylvania;
Average monthly calls:
Average monthly calls for Medicare savings programs:
* Prior to: 1,095;
* During: 4,418 (303 percent increase);
* After: 2,039 (54 percent decrease);
Average monthly applications: Not available[C].
State: Washington;
Average monthly calls:
Average monthly calls for Medicare savings programs specific to the
SSA mailing:
* Prior to: not available;
* During: 1,180;
* After: 175 (85 percent decrease);
Average monthly applications: Average monthly applications mailed to
beneficiaries in response to the SSA mailing:
* Prior to: not available;
* During: 1,127;
* After: 168 (85 percent decrease).
State: Washington (continued);
Average monthly calls: [Empty];
Average monthly applications: Average monthly applications received in
response to the SSA mailing:
* Prior to: not available;
* During: 436[D];
* After: 121 (72 percent decrease).
Source: GAO analysis of data from selected states.
Note: Unless otherwise noted, the period prior to the SSA mailing
included January through April 2002; the period during the mailing was
May through November 2002; and the period after the mailing was
December 2002 through April 2003.
[A] Louisiana provided data on the number of applications that were
sent to beneficiaries from the state's Medicaid office. These averages
do not include applications mailed by other agencies or organizations
across the state, which may explain why more applications were received
than mailed during the same period.
[B] We did not include January 2002 applications in the monthly average
because of a large surge in applications during that month, which was
probably attributable to the state's QI program temporarily closing and
reopening for enrollment.
[C] Pennsylvania reported that about 0.5 percent of individuals sent
the SSA mailing filed applications, and 73 percent of filed
applications were approved, but the officials could not provide monthly
data.
[D] Data on applications received were not available for May and June
2002 and are not included in the average.
[End of table]
Concurrent with SSA's mailing, each of the states we reviewed reported
that the state or other stakeholders conducted additional outreach. For
example, the Louisiana Department of Health and Hospitals and the
Pennsylvania Health Law Project, a coalition advocating for low-income
individuals and the disabled, each received 3-year grants from the
Robert Wood Johnson Foundation in 2002 to conduct outreach to low-
income Medicare beneficiaries in these states. A state official also
reported that in 2002 the New York Department of Health developed and
distributed 100,000 copies of a brochure called "How To Protect Your
Health and Money," which included information about the Medicare
savings programs, and conducted a "Senior Day" at 16 sites in New York
City and several other districts as well as presentations at local
fairs. Other states reported coordinating with community or state
organizations as well as private health plans participating in
Medicare, such as health maintenance organizations participating in the
Medicare + Choice program.[Footnote 30] Some private health plans
conducted outreach to increase Medicare savings program enrollment
since CMS pays these plans a higher rate for these enrollees. Several
state officials also said that their states work with other groups,
such as the local departments of aging or senior services and local
businesses and community organizations, to assist with outreach efforts
to potentially eligible beneficiaries. None of the states we reviewed
reported having assessed the effectiveness of their outreach efforts.
Of the six states we reviewed, only Louisiana and Pennsylvania
officials reported that they used the data file listing names and
addresses of potentially eligible beneficiaries provided by SSA in 2002
to assist with state outreach or enrollment efforts. For example, after
receiving the SSA data file, seven parishes in Louisiana used it to
obtain a list of potentially eligible beneficiaries and sent an
application with a letter and return envelope to these beneficiaries.
In 2003, about 20,450 applications were mailed to potential
beneficiaries. Pennsylvania officials used the file to cross-check
against the state's own data system to assess the number of
applications authorized, rejected, or denied as a result of the SSA
mailing.
Agency and State Comments:
We provided a draft of this report to SSA, CMS, and state Medicaid
agencies in Alabama, California, Louisiana, New York, Pennsylvania, and
Washington. In written comments, SSA generally concurred with our
findings and provided technical comments that we incorporated as
appropriate. SSA also noted that improvements in state enrollment
processes could further increase enrollment. SSA's comments are
reprinted in appendix V. In a written response, CMS stated it did not
have any specific comments on the report. However, CMS provided
technical comments that we incorporated as appropriate.
While we did not examine the effects of SSA's 2003 mailing, Louisiana
Medicaid officials indicated that, in comparison to the 2002 SSA
mailing, there was little increase in call volume following SSA's 2003
mailing, and that they believe that this was because a state-specific
telephone number was not included in the 2003 outreach letter. New York
Medicaid officials stated that they found an increase in Medicare
savings program enrollment of over 6 percent from December 2002 to
December 2003. However, in addition to being a different timeframe from
what we examined, we do not believe that all of this increase can be
attributed to the SSA mailing. Based on our analysis of SSA's MBR data,
we report a 0.3 percent increase in enrollment in New York specifically
attributable to the 2002 SSA outreach mailing. We found the net
increase in enrollment from May 2002 to May 2003 (following SSA's 2002
mailing) to be 5.9 percent nationwide, similar to the net increase in
enrollment that New York reported from December 2002 to December 2003.
Louisiana and Pennsylvania Medicaid officials also provided technical
comments that we incorporated as appropriate. Alabama, California, and
Washington Medicaid officials reviewed the draft and stated that the
report accurately reflected information relevant to their respective
states.
We are sending copies of this report to the Commissioner of SSA, the
Administrator of CMS, and other interested parties. We will also
provide copies to others on request. In addition, this report will be
available at no charge on GAO's Web site at http://www.gao.gov.
Please call me at (202) 512-7118 or John Dicken at (202) 512-7043 if
you have any additional questions. N. Rotimi Adebonojo and Rashmi
Agarwal were major contributors to this report.
Kathryn G. Allen:
Director, Health Care--Medicaid and Private Health Insurance Issues:
List of Committees:
The Honorable Charles E. Grassley:
Chairman:
The Honorable Max Baucus:
Ranking Minority Member:
Committee on Finance:
United States Senate:
The Honorable Joe Barton:
Chairman:
The Honorable John D. Dingell:
Ranking Minority Member:
Committee on Energy and Commerce:
House of Representatives:
The Honorable William M. Thomas:
Chairman:
The Honorable Charles B. Rangel:
Ranking Minority Member:
Committee on Ways and Means:
House of Representatives:
[End of section]
Appendix I: Methodology:
To determine what outreach the Social Security Administration (SSA)
conducted in response to the statutory requirement, we obtained and
reviewed copies of SSA documents, including sample 2002 and 2003
outreach letters and data on the number of letters sent to eligible
Medicare beneficiaries in each state, as well as reports prepared by
the Centers for Medicare & Medicaid Services (CMS) related to the
Medicare savings program. In addition, we interviewed officials from
the SSA and CMS.
To determine how enrollment changed following SSA's outreach, we
analyzed records from SSA's Master Beneficiary Record (MBR)[Footnote
31]--a database that contains the administrative records of Social
Security beneficiaries, including payments for Medicare premiums--and
CMS's national enrollment data for the Medicare savings programs. The
MBR data contain demographic information as well as information on the
monthly deductions made from beneficiaries' Social Security checks to
cover Medicare part B premiums.[Footnote 32] We obtained MBR data on
beneficiaries who were sent the outreach letters in the first six
mailings in May and the last six mailings through November
2002,[Footnote 33] representing 2.6 million of the 16.4 million Social
Security beneficiaries who were sent letters from SSA. To determine
which letter recipients enrolled in the Medicare savings programs
following SSA's 2002 mailing, we identified letter recipients who met
the following criteria:
* those whose date of eligibility for Medicare savings programs began
January 2002 or afterwards;
* those for whom a third-party payer, specifically a state, made
payments on their behalf to cover Medicare part B premiums; [Footnote
34] and:
* those who no longer had the premium deduction made from their Social
Security checks to cover Medicare part B premiums at any point from
June 2002 through December 2002.[Footnote 35]
In order to estimate the impact of the SSA outreach mailing on
additional enrollment in Medicare savings programs, we analyzed monthly
enrollment from June 2002 to December 2002 for two cohorts of letter
recipients to identify letter recipients who enrolled in Medicare
savings programs following the initiation of the SSA mailing in May
2002.[Footnote 36] Because the mailings were sent to beneficiaries in a
random order, the only notable difference between the recipients in the
two cohorts would be the timing of when the SSA letters were sent to
them. SSA officials noted that it typically takes about 3 months until
enrollment is reported on the MBR. Therefore, since the mailings began
in May 2002, the first effects of the mailing would not have been
apparent until after June 2002. We analyzed the MBR data provided by
SSA to determine specifically what month and year a letter recipient
enrolled in Medicare savings programs. Using the enrollment by the
November cohort as a baseline because these individuals met the same
selection criteria as those in the May cohort, we estimated the net
effect of the SSA mailing by comparing the difference in cumulative
monthly enrollment between the May and November cohorts in December
2002--this difference represented the additional enrollment we
attributed to the SSA mailing.[Footnote 37] We made the comparison in
December 2002 because after this date the enrollment of the baseline
group began increasing at a rate faster than the May cohort, indicating
that this was the point when the largest cumulative difference in
enrollment between the two cohorts occurred before the effects of the
mailing started becoming evident for the November cohort. Using the
same methodology, we calculated the effect of the SSA outreach letter
for certain demographic groups and for beneficiaries in each state. We
also obtained and analyzed data contained in CMS's third party master
file for the period May 1999 to May 2003 that tracks national Medicare
savings programs enrollment.[Footnote 38] Using these data, we examined
how national Medicare savings enrollment trends compared before and
after the 2002 SSA mailing.
To determine how additional enrollment in the programs changed in
selected states following SSA's outreach and what outreach efforts
these states undertook, we interviewed Medicaid officials in six
states--Alabama, California, Louisiana, New York, Pennsylvania, and
Washington. We selected these states based on several factors,
including states with different levels of change in overall Medicare
savings programs enrollment from 2002 to 2003, geographic diversity,
relatively large populations of Medicare savings programs enrollees,
and availability of data on program enrollment. We also reviewed CMS's
third party master file to identify how many beneficiaries in each
state were enrolled in Medicare savings programs, and analyzed records
from SSA's MBR to estimate the additional enrollment in each state
following the SSA mailing. In addition, we obtained information from
each state to the extent available on its involvement with the SSA
mailing, the state's specific eligibility criteria for its Medicare
savings program, outreach efforts conducted by the state to low-income
Medicare beneficiaries, and state data on call and application volume
before, during, and after the SSA outreach.
We obtained information from SSA and CMS on their data reliability
checks and any known limitations on the data they provided us. SSA and
CMS perform quality controls, such as data system edits, on the MBR and
the third party beneficiary master file, respectively. We concluded
that their data were sufficiently reliable for our analysis. A few MBR
variables have certain limitations. For example, some Medicare
beneficiaries receive their Social Security payments electronically,
and therefore may not keep the record of their mailing address current.
For our analysis we only used the beneficiary's state of residence,
which is less likely to change as SSA reported that, even if a
beneficiary's address changes, the beneficiary often:
stays within the same state of residence. Finally, since it is optional
for beneficiaries to identify their race, a number of Social Security
recipients do not. However, sufficient numbers of individuals reported
their race to to allow us to analyze these data and also report missing
or unknown values.
[End of section]
Appendix II: SSA 2002 Outreach Letter:
SSA mailed 16.4 million letters in 2002 to potentially eligible
Medicare beneficiaries notifying them about state Medicare savings
programs. These letters were customized to include state-specific
information, including a state contact number. These letters were sent
in English or Spanish, depending on the beneficiary's preference.
Figure 2 provides a sample of the outreach letter sent to a beneficiary
in Texas between May and November 2002.
Figure 2: Sample 2002 SSA Letter:
[See PDF for image]
[End of figure]
[End of section]
Appendix III: Medicare Savings Program Enrollment following 2002 SSA
Mailing by State:
Figure 3 shows enrollment by state of the estimated 74,000 additional
beneficiaries who enrolled in Medicare savings programs following the
2002 SSA mailing. Because these estimates are based on two cohorts of
about 1.3 million beneficiaries each that represent a sample of the
entire population of 16.4 million beneficiaries, we calculated 95
percent confidence intervals to reflect the potential for statistical
error in projecting these estimates from the sample cohorts to the
entire population. The small sample size in states with smaller
populations results in larger confidence intervals for the estimates
for these states. The highest additional increase in enrollment was in
Alabama, in which an estimated 2.9 percent (with a 95 percent
confidence interval of 2.6 percent to 3.3 percent) of beneficiaries who
were sent the SSA letter enrolled than if the mailing had not occurred.
In three states (Montana, Utah, and Vermont) our analysis showed no
additional or slightly negative enrollment following the SSA mailing,
and because the confidence intervals for these and 13 other states
overlap the numeric value zero, the data do not show a statistically
significant change in additional enrollment in the Medicare savings
programs following the 2002 SSA mailing for these states. The other 35
states showed a statistically significant increase in additional
enrollment in the Medicare savings programs following the 2002 SSA
mailing.
Figure 3: Estimated Percentage Change in Medicare Savings Program
Enrollment Following 2002 SSA Mailing by State, December 2002:
[See PDF for image]
[End of figure]
[End of section]
Appendix IV: Medicare Savings Program Enrollment following 2002 SSA
Mailing by Demographic Group:
On the basis of our analysis of SSA's MBR, we estimate that enrollment
in Medicare savings programs was about 74,000 higher for Medicare
beneficiaries following the 2002 SSA mailing than it would have been
without the mailing. This represents about 0.5 percent of the 16.4
million letters sent nationwide. However, this additional enrollment
following the SSA mailing varied among demographic groups.
Figure 4 shows the additional enrollment in Medicare savings programs
following the 2002 SSA mailing by geographic region and demographic
groups, including racial categories, sex, disability status, and age
categories. Because these estimates are based on two cohorts of about
1.3 million beneficiaries each that represent a sample of the entire
population of 16.4 million beneficiaries, we calculated 95 percent
confidence intervals to reflect the potential for statistical error in
projecting these estimates from the sample cohorts to the entire
population. Additional enrollment following the 2002 SSA mailing was
statistically significantly higher among beneficiaries in southern
states compared to other geographic regions, minorities compared to
white beneficiaries, beneficiaries with disabilities compared to
beneficiaries without disabilities, and beneficiaries who were younger
than 65 years compared to those who were 65 years or older.
Figure 4: Estimated Percentage Change in Medicare Savings Program
Enrollment Following 2002 SSA Mailing by Demographic Group, December
2002:
[See PDF for image]
Note: Some estimates do not show an upper or lower bound because the 95
percent confidence interval was the same as the point estimate due to
rounding.
[A] Based on SSA's data categories, "minority" includes blacks or
individuals of African origin, Asians and Pacific Islanders, and North
American Indians or Eskimos.
[End of figure]
[End of section]
Appendix V: Comments from the Social Security Administration:
SOCIAL SECURITY:
The Commissioner
Febuary 20, 2004:
Ms. Kathryn G. Allen:
Director, Health Care--Medicaid and Private Health Insurance Issues:
U.S. General Accounting Office Room 5C27:
441 G Street, NW:
Washington, D.C. 20548:
Dear Ms. Allen:
Thank you for the opportunity to review and comment on the draft report
"Medicare Savings Programs: Results of Social Security Administration's
2002 Outreach to Low-Income Beneficiaries" (GAO-04-363). Our comments
on the report are enclosed.
If you have any questions, please have your staff contact Candace
Skumik, Director, Audit Management and Liaison Staff, at (410) 965-
4636.
Sincerely,
Signed by:
Jo Anne B. Barnhart:
Enclosure:
SOCIAL SECURITY ADMINISTRATION BALTIMORE MD 21235-0001:
COMMENTS ON THE GENERAL ACCOUNTING OFFICE (GAO) DRAFT REPORT "MEDICARE
SAVINGS PROGRAMS: RESULTS OF SOCIAL SECURITY ADMINISTRATION'S 2002
OUTREACH TO LOW-INCOME BENEFICIARIES" (GAO-04-363):
Thank you for the opportunity to review and comment on the draft
report. We agree with GAO's findings that the Social Security
Administration's (SSA) mailings of 16.4 million letters in 2002 to
potentially eligible beneficiaries contributed to the increased
enrollment in the Medicare Savings Programs. We are pleased to see that
more than 74,000
additional eligible beneficiaries enrolled in Medicare savings programs
as a result of the outreach mailings carried out by SSA in 2002. We
anticipate a continued increase in participation by low-income
beneficiaries as the outreach efforts by SSA and State agencies
generate increased awareness among eligible individuals. Indeed, SSA
intends to repeat these outreach mailings on an annual basis.
Although outreach is an important component of this program, we believe
that improvements in the State enrollment process could further
increase enrollments. States may wish to consider publishing their
eligibility requirements on a central website. They could also share
information with each other on methods for streamlining the enrollment
process or increasing enrollments.
[End of section]
Related GAO Products:
Medicare and Medicaid: Implementing State Demonstrations for Dual
Eligibles Has Proven Challenging. GAO/HEHS-00-94. Washington, D.C.:
August 18, 2000.
Low-Income Medicare Beneficiaries: Further Outreach and Administrative
Simplification Could Increase Enrollment. GAO/HEHS-99-61. Washington,
D.C.: April 9, 1999.
Medicare and Medicaid: Meeting Needs of Dual Eligibles Raises Difficult
Cost and Care Issues. GAO/T-HEHS-97-119. Washington, D.C.: April 29,
1997.
Medicare and Medicaid: Many Eligible People Not Enrolled in Qualified
Medicare Beneficiary Program. GAO/HEHS-94-52. Washington, D.C.:
January 20, 1994.
FOOTNOTES
[1] U.S. General Accounting Office, Low-Income Medicare Beneficiaries:
Further Outreach and Administrative Simplification Could Increase
Enrollment, GAO/HEHS-99-61, (Washington, D.C.: Apr. 9, 1999).
[2] See, for example, Kim Glaun, National Senior Citizens Law Center,
Medicaid Programs to Assist Low-Income Medicare Beneficiaries: Medicare
Savings Programs Case Study Findings, prepared for The Kaiser
Commission on Medicaid and the Uninsured, December 2002; and Susan G.
Haber et al, RTI International, Evaluation of Qualified Medicare
Beneficiary (QMB) and Specified Low-Income Medicare Beneficiary (SLMB)
Programs, prepared for the Centers for Medicare & Medicaid Services,
October 1, 2003.
[3] Medicare, Medicaid, and SCHIP Benefits Improvement and Protection
Act of 2000 (BIPA), Pub. L. No. 106-554, App. F, § 911(a), 114 Stat.
2763, 2763A-583 (adding section 1144 to the Social Security Act;
codified at 42 U.S.C. § 1320b-14 (2000)).
[4] BIPA § 911(b), 114 Stat. 2763A-584.
[5] Throughout this report, we refer to all beneficiaries who were
included in SSA's mailing as "recipients" because past SSA efforts
found that only 1.5 percent of letters were returned as undeliverable.
[6] Throughout this report, we include the District of Columbia in our
discussion of states.
[7] The premium amount is adjusted each year so that expected Medicare
premium revenues equal 25 percent of expected Medicare part B spending.
42 U.S.C. § 1395r(a) (2000).
[8] Within broad federal guidelines, states have considerable
flexibility in how they administer their Medicaid programs. States
administer covered services under a state Medicaid plan that CMS
approves. State Medicaid programs must cover certain mandatory
services, such as physician services and nursing facility care. While
Medicare covers some or all of up to 100 days of skilled nursing
facility care following a hospitalization, Medicaid covers extended
nursing facility care. State Medicaid programs may also cover certain
CMS approved optional Medicaid services, such as prescription drugs.
The federal government shares the cost of state Medicaid expenditures
according to a statutory formula, whereby the federal share ranged from
50 to 77 percent of state Medicaid expenditures in fiscal year 2003.
[9] Section 1902(r)(2) of the Medicaid statute provides states
flexibility to use less restrictive or liberalized methodologies than
are typically used for Medicaid in counting applicants' income and
resources to expand eligibility for the Medicare savings program.
[10] SSI provides cash assistance to aged, blind, and disabled
individuals who have limited income and resources. In 2003, the
resource limit was $2,000 for individuals and $3,000 for couples. SSI
resource limits typically exclude the beneficiary's automobile and
house.
[11] These agreements are made under authority contained in 42 U.S.C. §
1383c(a) (2000).
[12] Omnibus Consolidated and Emergency Supplemental Appropriations
Act, 1999, Pub. L. No. 105-277, 112 Stat. 2681, 2681-383 (1998).
[13] AARP, formerly known as the American Association for Retired
People, is an association representing individuals over the age of 50.
[14] For further information on the six models and the demonstration
project results, see Lisa Maria B. Alecxih et al, Results from the SSA
Buy-In Demonstration: Final Report, prepared by The Lewin Group SSA,
October 4, 2001.
[15] 42 U.S.C. § 1320b-14(b) (2000).
[16] See CMS, FY 2004 GPRA Annual Performance Plan (Washington, D.C.,
2003).
[17] SSA officials stated that the mailings were based on the last two
digits of the recipients' Social Security numbers, which are random and
not based on any geographic, age, or other demographic characteristic.
For each mailing, SSA's mail vendor selected approximately 207,000
letters based on this sequence, and then sorted the letters by zip code
before mailing them out.
[18] SSA elected to send this mailing only to individuals potentially
eligible for the QMB, SLMB, and QI-1 programs. SSA did not have current
income data needed to select potentially eligible QDWI individuals. The
FPL for an individual in the 48 contiguous states was $8,860 in 2002.
For a couple, the FPL was $11,940. The FPL is higher in Alaska and
Hawaii.
[19] Letters were sent in either English or Spanish based on the
language preference provided to SSA in the past.
[20] The QDWI letters were timed by SSA to arrive near the general
enrollment period for Medicare part A, which runs from January 1
through March 31 each year.
[21] SSA's security protocol requires states to provide certain
information in order for SSA to send the data files. Six states did not
provide this information and therefore SSA did not send the data file
to them.
[22] 42 U.S.C. § 1320b-14(b)(1)(B) (2000).
[23] For example, individuals who did not previously receive an
outreach letter may subsequently meet the income criteria due to
reduced income from the death of a spouse.
[24] Thus, over a period of 5 years, SSA will resend letters to all
2002 letter recipients who still meet the mailing criteria but have not
enrolled in Medicare savings programs.
[25] Persons with disabilities are persons of any age who are unable to
do any kind of substantial gainful activity because of a physical or
mental impairment (or a combination of impairments) that has lasted or
is expected to last for a continuous period of at least 12 months, or
that is expected to result in death. 42 U.S.C. § 416(i)(1)(A) (2000).
[26] After December 2002, additional enrollment among the baseline
group began increasing faster than the May cohort, indicating that the
maximum cumulative effect of the 2002 SSA mailing for the May cohort
relative to the baseline occurred as of December 2002.
[27] The CMS data showing about a 341,000 increase in Medicare savings
program enrollment from May 2002 to May 2003 represents the net change
in enrollment including both increases (due to new enrollees) as well
as decreases (due to former program enrollees who died or otherwise
were no longer enrolled). Our analysis of the SSA MBR data, estimating
an increase in enrollment following the SSA mailing of about 386,000
beneficiaries, reflects only new enrollees because the SSA letter went
only to those beneficiaries not enrolled in Medicare savings programs
at the time.
[28] We calculated age as of May 10, 2002, the first date of the SSA
mailing, using the beneficiary's date of birth.
[29] See Lisa Maria B. Alecxih et al, Results from the SSA Buy-In
Demonstration: Final Report.
[30] California officials also reported that Medicare health
maintenance organizations in California provided outreach through
private contractors approved by CMS.
[31] The MBR contains records for Social Security beneficiaries who
were entitled to receive benefits under the Old-Age, Survivors and
Disability Insurance program. SSA provided us with certain records from
the MBR that included demographic information as well as Medicare
benefit payments.
[32] For Medicare beneficiaries who elect to participate in Medicare
part B, SSA typically withholds an amount equal to their Medicare part
B premium from their monthly Social Security checks.
[33] Mailing dates for the May cohort include those from May 10 through
May 22, 2002, and for the November cohort include mailing dates from
October 28 through November 8, 2002.
[34] MBR data show third-party payments from three sources--a state, a
private payer, or federal civil service.
[35] When a Medicare beneficiary enrolls in a Medicare savings program,
the Medicare part B premium is no longer deducted from the
beneficiary's Social Security check but is instead paid by the state.
[36] Our data for both cohorts did not include beneficiaries
potentially eligible for QI-2 or the 53,000 beneficiaries who were sent
a November 2002 SSA mailing about potential eligibility for the
separate QDWI program.
[37] Our analysis may not include potential beneficiaries in the May
cohort who significantly delayed presenting a Medicare savings program
application to state Medicaid offices for eligibility screening or
those whose applications were in the eligibility determination process
after December 2002. In addition, some letter recipients in the
November cohort may have enrolled prior to receiving the letter because
they learned about the programs from others, such as neighbors or
relatives, who already received the mailing.
[38] The third-party master file contains records for Medicare
beneficiaries for whom a third party, such as a state welfare agency or
a private group payer, pays their Medicare part A or B premiums. SSA's
field offices, state welfare agencies, private groups, and the Office
of Personnel Management collect the information and send it to CMS for
monthly updates. CMS uses these data to track enrollment and bill
states and other groups accordingly.
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