Tennessee’s Katie Beckett waiver program passed into law in the summer of 2019 to great acclaim. The waiver, which provides support for families of children with complex medical needs without regard to their parents’ income or assets, would ostensibly fill the final gap in coverage for children with disabilities in Tennessee. As the 50th state to enact such a plan, a strong pathway already existed for TennCare to create and enact the plan that ensures that our state’s Katie Beckett program was comprehensive, thorough and of the highest quality.
Katie Beckett is a financial support program for children with complex disabilities or medical needs who are ineligible to receive Medicaid because of their parents’ income level. The program provides much needed financial assistance to these families to help pay for things like doctor visits, home- and community-based services, therapies and other health care services. TennCare, the state’s Medicaid division, is responsible for the design, implementation and administration of the Katie Beckett program.
TennCare’s design of the Katie Beckett program in Tennessee is uniquely divided into two parts. Part A is reserved for children with the most significant disabilities and health care needs that would previously have been provided in an institutional setting. Those in part A receive full Medicaid benefits, plus home- and community-based services (HCBS) capped at $15,000 a year. Part B is for children with significant disabilities and health care needs who would be “at-risk” of institutionalization without necessary services. Children in Part B are eligible for up to $10,000 of HCBS to assist with a number of different healthcare-related expenses.
Like many large, complicated programs, TennCare has encountered issues and obstacles that it had not predicted. For example, some parents had difficulty coordinating communication between TennCare and the various technology platforms it used for Katie Beckett applications. These technical issues, while frustrating, were and are not structurally problematic. However, there are some serious structural problems with the program, one of which is the “CoverKids gap”.
CoverKids is the state’s federally-sponsored Children’s Health Insurance Program (CHIP). It provides health insurance services to children who don’t have other insurance, and whose parents’ income disqualifies them from TennCare (Medicaid). Most kids who qualify for CoverKids have working-class parents who make between 133% and 250% of the federal poverty level. For a family of three, this is between about $29,000 and $55,000 per year in household income. These are not rich families that receive CoverKids – two parents who work 40 hours a week are each making about $10 per hour at this rate.
CoverKids/CHIP is not Medicaid – it is administered and partially funded by each state, with matching funds from the Centers for Medicare and Medicaid (CMS). For example, Early and Periodic Screening, Diagnostic and Treatment (EPSDT) is available to children enrolled in Medicaid, but not to those enrolled in CoverKids. This is important, because families receiving Medicaid are ineligible for the Katie Beckett program. Because CMS grants each state some degree of latitude in administering their CHIP programs, Tennessee chose to make TennCare responsible for the construction of Tennessee’s CoverKids program. TennCare has curiously and erroneously chosen to define CoverKids/CHIP as a Medicaid program, meaning that children on CHIP are ineligible for Katie Beckett. Again, CoverKids is statutorily separate and fundamentally different from Medicaid.
This distinction creates a gap in coverage, where children with disabilities in many working-class families are ineligible for the Katie Beckett program. Children who would normally qualify for Part B services are entirely excluded from the program because TennCare has determined that CoverKids is the same as Medicaid, and children on Medicaid are ineligible for Katie Beckett. Essentially, this forces parents within the CoverKids income eligibility parameters to receive CoverKids, a program with significantly fewer supports than Katie Beckett. Because TennCare has chosen to call CoverKids “Medicaid”, simply being eligible for CoverKids, regardless of whether or not the family chooses to enroll in the program, uniformly disqualifies children with expensive, complex health care needs from receiving much-needed support from the Katie Beckett Part B program.
Children in CoverKids may also face high hurdles to receiving Katie Becket Part A services. In order to qualify for the Katie Beckett Part A program, TennCare requires that families retain health insurance for their child, also called a third-party liability policy (TPL). This is not an unreasonable cost mitigation strategy. However, TennCare chooses not to recognize CoverKids as qualifying health insurance coverage, which is unreasonable. CoverKids, for all intents and purposes, is the same as private health insurance. Families with CoverKids are charged copays for the care that their children receive, just like private health insurance, which could cost a family of four as much as $2,550 per year.
Parents of CoverKids children who would qualify for Katie Beckett Part A could terminate their CoverKids coverage and purchase private coverage that TennCare has chosen to be acceptable TPL. This, of course, requires that children with significant disabilities and complex health care needs temporarily go without insurance coverage and then purchase insurance on the marketplace. However, quality health insurance plans for one adult and one dependent on the marketplace can run upwards of $800 per month, or $9,600 per year, not including deductible and out-of-pocket expenses. That is nearly a third of the annual household income for some CoverKids families. Furthermore, because TennCare considers CoverKids to be Medicaid, this requires these families to drop CoverKids (which TennCare defines as Medicaid), purchase other private insurance, only to be enrolled in Medicaid.
TennCare’s choice to exclude children with CoverKids from receiving Katie Becket services because their families are not poor enough to receive care from Medicaid, but not rich enough to buy the “right” insurance coverage, is an unnecessary and harmful distinction. It’s fundamentally discriminatory against a small subsection of the very group of people the Katie Beckett program was meant to serve. TennCare thus presents a difficult choice for parents, who, in order to get necessarily comprehensive services for their children, must either impoverish themselves to obtain Medicaid, or choose to forego essential services for their children. There is no other option for these families.
TennCare’s decision-making and design of the Katie Beckett program, which was intended to provide Tennessee children and families with critical insurance coverage and other supportive services, has created a huge gap. The choice to define CoverKids as “Medicaid”, as well as the choice to require third party liability insurance to be “private”, excludes many families who need and deserve this support. For some children with disabilities in Tennessee, TennCare has chosen to set price of admission for Katie Beckett out of their reach.
The General Assembly required the creation of the Katie Beckett program to serve Tennessee children with the most complex medical needs. State lawmakers did not do this with the intention that it should exclude families that are trying to care for their kids based upon their working-class income. Governor Lee did not sign this bill into law so that parents must face the choice to impoverish themselves or to forego vital care for their children in order to receive help.
Tennessee’s Katie Beckett program is a long overdue lifeboat for parents of children with complex medical needs who have struggled to access care for their kids for too long. It should be available for every child for whom the program is meant to serve, without gaps, difficult choices and unnecessary burdens. TennCare has the ability to close this gap. Tennessee’s hard-working families deserve nothing less.