Providing Access to Health Care for SSDI Program Recipients

Medicare provides health benefits to individuals who are entitled to cash benefits under the Social Security Disability Insurance (SSDI) program. However, most of these individuals, who cannot work because of disability and often have serious health problems, must wait two years before they can receive Medicare benefits. In the meantime, they have limited access to needed medical care.

We estimated the savings that would be generated for Medicaid and the costs that would be incurred by Medicare from two possible changes that would expand access to health care for this group: (1) eliminating the two-year Medicare waiting period; and (2) adding a Medicare prescription drug benefit.

We also estimated that Medicare coverage of the 1.2 million SSDI beneficiaries during the two-year waiting period for Medicare—approximately 40 percent of whom now are covered by Medicaid— would save states about $1.8 billion at 2002 program levels. Medicare costs would increase by about $8.7 billion ($4.6 billion for those now on Medicaid, and $4.1 billion for those not covered by Medicaid), but the increase in Medicare costs would be partially offset in the federal budget as a whole by a $2.5 billion reduction in federal Medicaid expenditures.

Mathematica estimated that a complete Medicare takeover of prescription drug costs for Medicare-Medicaid dual eligibles would save state Medicaid programs about $6.8 billion at 2002 program levels. It would also increase federal Medicare expenditures by approximately $16 billion. This increase in Medicare expenditures would be offset in the federal budget as a whole by about $9 billion in federal Medicaid savings.

This study was funded by the Commonwealth Fund.

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