Katie Beckett Waiver/ TEFRA Option
Who is Katie Beckett?
Katie Beckett contracted viral encephalitis, a brain infection, when she was just five months old. After being admitted to the hospital, she had a seizure that sent her into a coma for ten days. After coming out of the coma, she suffered paralysis that left her unable to breathe or swallow without the assistance of a ventilator.
The Becketts had private insurance, but during her extensive hospitalization, she reached her family’s million dollar private insurance cap. However, during her stay in the hospital, she was also able to get Medicaid coverage because if a child is institutionalized in a hospital, nursing home, or an intermediate care facility for 30 days or more, the parents’ income is not used to determine eligibility for Medicaid.
After nearly three years in the hospital, Katie’s condition improved to the point where she was ready to go home with her parents.
In 1981, if a child with disabilities who lived at home needed Medicaid coverage, the family’s income and assets were considered for eligibility, and the child had to be living in a household with very low income to receive Medicaid benefits. This meant that if the parents had income too high to qualify for Medicaid but could not afford their child’s medical care, the only way they could get the appropriate care for their child would be to place their child in an institution, become impoverished, or relinquish custody to the state.
Katie Beckett’s story gained the attention of then president Ronald Reagan and showed the nation the absurdities of a system that will pay more to care for a child in a hospital but will not provide that child’s family with the health coverage and support they need to care for the child at home, even when the cost is much lower.
In 1981, the Reagan Administration created the Katie Beckett waiver which created an exception that allowed Katie, and children like her, to receive their care at home, while retaining their Medicaid coverage, regardless of parent’s income. More than 22 states have the Katie Beckett waiver or something like it, but Tennessee does not.
Why is TennCare Important for Children with Special Health Care Needs?
- Compared to private insurance, TennCare covers more of the services this group needs and in the amounts that they need.
- Better for ongoing medical needs than private insurance.
- No co-pays
What’s the Problem?
TennCare is mainly for children at lowest income levels, but children with special health care needs are found at all income levels.
Children with disabilities are not automatically given TennCare. They also have to meet the financial eligibility criteria.
Families who earn too much to qualify for TennCare have few options for getting it.
Medical care for a child with a disability can cost more than most families can afford, even with private insurance.
- Some families are even forced to give up custody of their child or put them in an institution because they can’t afford their care.
How are Tennessee Children Affected?
- There are 255, 692 children with special health care needs in Tennessee
- This is over 17% of the state’s child population
- In a given year, about 5% of children with special health care needs do not have insurance
- 26% of the children who are insured have insurance that is inadequate
Options for Tennessee
- Federal Medicaid law requires states to cover certain groups and services. It also allows states to apply for a waiver, which gives states the option to extend coverage to additional groups of people or provide extra services.
- The Katie Beckett Waiver allows states to give Medicaid to children with disabilities as a way of preventing institutionalization, even if their parents earn too much for them to qualify for Medicaid. The waiver can also expand the array of services these children receive.
- The waiver was expanded in 1982 with the Tax Equity and Fiscal Responsibility Act (TEFRA). This allowed states to have the option to make Medicaid benefits available to children with physical or mental disabilities who would ordinarily not be eligible for Medicaid benefits because the parent’s income and resources were too high.
- A child could qualify if they:
- Meet SSI criteria for disability
- Are 18 years old or younger
- Meet the state’s criteria for an institutional level of care
- Have medical care needs that can be safely provided outside of an institutional setting
- The cost of care in the community does not exceed the cost of institutional care
What is the benefit to the state?
- Tennessee could be heralded as a state that makes children, and their health, a priority
- Twenty-two states (including Georgia, South Carolina, and Mississippi) offer either the Katie Beckett waiver or the TEFRA option, and a few more states offer demonstration programs based on TEFRA or the Katie Beckett waiver.
- Tennessee could save money
Covering children with significant disabilities is likely to be more cost-effective over the long term because routine preventive care is less expensive than catastrophic acute care.
The cost of expanding coverage to this group is usually low. Some states pay less than 25% of the total health-related costs of children on the program. Private insurance, family’s premiums, schools, and counties cover the rest.
- Allowing children to have services at home instead of in an institution saves the state money. For example, the average cost of Home and Community-based waiver services in TN per year is $75,411, while the average cost of state institutions in TN per year is $375,950.
What Can You Do?
This is the beginning of this campaign (though many of you have been advocating for this for years). We think the most important thing you can be doing at this point is sharing your story. Your stories, your children, you are the only ones that will show that there is a huge gap that exists in TN. You guys will make the difference. You guys are the experts.
For other ideas about to get involved, please see below!
- Learn more about the Katie Beckett waiver and TEFRA option.
- Share your story- This is the lifeblood of this issue. Putting names and faces to this issue is the only way legislators will understand the great need that exists.
- Tell others about it- parents, advocates, legislators, etc.
- Write a letter to your legislator.
- Host a meeting- Take what you have learned and teach others! You could hold a meeting in your home, school, place of worship, neighborhood, etc. Like we said, you are the best voice to share your story and the need that exists in Tennessee. We are also happy to help you prepare for this.
- Like the Katie Beckett/ TEFRA Facebook page to receive updates and connect with others involved in this movement.
- Send letters to editors across the state. Please let me know if you’re interested in doing so and we can discuss.
- Be creative- if you think of more ideas, please feel free to let us know.
- If you want to get involved, but can’t do any of those things, we understand. Please email us at firstname.lastname@example.org and we can discuss how to get you involved!
For more information, please “like” the Katie Beckett waiver/ TEFRA option Facebook page to receive updates and news!