Glossary of Medicaid Terms

A glossary of terms related to the Kentucky Medicaid program.

Term Definition
1115 Medicaid Waiver States can apply for an 1115 Medicaid Waiver with the federal government in order to receive additional flexibility in designing their Medicaid programs. Waivers must be budget neutral and are intended to lead to more stable coverage, better health outcomes, and improve the quality of health care delivery. The Bevin Administration has submitted an 1115 Medicaid Waiver proposal. The proposed plan is called Kentucky HEALTH and includes many changes to the Medicaid program. Most of the proposed changes directly impact individuals who received coverage through expanded Medicaid in 2014. Kentucky’s proposed 1115 Medicaid Waiver must be approved by the federal government before it can be implemented.
Able-bodied Individuals not deemed disabled and have an income at or below 138% of the Federal Poverty Level.
Affordable Care Act A federal health care system reform act signed into federal law in 2010.
Centers for Medicare and Medicaid Services (CMS) The federal agency within the United States Department of Health and Human Services which administers and oversees Medicare, Medicaid, and the Children’s Health Insurance Program within states. This is the agency responsible for approving Kentucky’s 1115 Medicaid Waiver application.
Commercial Marketplace An online place for individuals, families, and small businesses to purchase health insurance.
Community Engagement and Employment Requirement A requirement in Kentucky’s 1115 Medicaid Waiver proposal that all able-bodied, working age adult members (ages 18 to 64) without dependents participate in volunteer work, employment, job training, or job search activities to maintain enrollment.
Community Engagement and Health Incentive Activities Community engagement and health-related activities, such as smoking cessation classes or passing the GED exam, that would allow members to earn dollars for their My Rewards Account under the proposed 1115 Medicaid Waiver.
Cost-Sharing

When people pay for a portion of health care costs not covered by health insurance. Three types of cost-sharing include the following:

  • Co-Payments (Copays): An amount of money people pay to their insurer for each health service, office visit, or prescription medication. The amount differs depending on the services received.
  • Deductible: The amount people pay for covered health care services before their insurance plan starts to pay. With a $1,000 annual deductible, for example, the person pays the first $1,000 of covered services each year, and the insurance company pays for any expenses beyond $1,000.
  • Premiums: A fixed amount of money people have to pay each month to cover part of the costs of their health insurance.
Early and Periodic Screening, Diagnostic, and Treatment Services (EPSDT) The comprehensive set of benefits covered for children enrolled in Medicaid.
Employer-Sponsored Health Insurance Health insurance offered by a person’s employer. Typically, this type of insurance coverage is partially paid for by a business or establishment on behalf of its employees. Kentucky’s 1115 Medicaid Waiver proposal includes a plan to transition Medicaid members to employer-sponsored insurance.
Expanded Medicaid The Affordable Care Act included a provision for states to expand Medicaid coverage to more low-income adults up to 138% of the federal poverty level (FPL). The federal government picks up a large portion of the cost to expand. Prior to this law, most states only provided Medicaid coverage to vulnerable groups of children, pregnant women, disabled individuals, children in foster care, and a small population of parents. In 2012, the federal Supreme Court ruled that states had the option but were not required to expand Medicaid. Since then, each state has individually decided whether or not to expand. Kentucky expanded Medicaid in 2014.
Federal Poverty Level (FPL): A measure of income issued every year by the Department of Health and Human Services. The FPL is used to determine eligibility for certain programs and benefits, including Medicaid.
High-Deductible Health Plan (HDHP) A health plan with a higher deductible than a traditional insurance plan. Usually the monthly premium is lower, but Medicaid members have to pay more health care costs (their deductible) before the insurance company starts to pay its share. Kentucky’s proposed 1115 Medicaid Waiver includes high-deductible health plans.
Kentucky Children’s Health Insurance Program (KCHIP) Provides health insurance to children whose families’ incomes are too high for them to qualify for Medicaid but cannot generally afford private or employer-sponsored insurance. Like Medicaid, the federal government covers most of the costs of KCHIP, with the state covering a small portion of the costs. The KCHIP application and program is closely aligned with Medicaid for children in Kentucky.
Kentucky HEALTH The name of the plan proposed by the Bevin Administration to transform Kentucky’s Medicaid program through an 1115 Medicaid Waiver.
Lockout period A provision in Kentucky’s 1115 Medicaid Waiver proposal where an individual loses Medicaid coverage for a specified amount of time and cannot re-enroll, even if they are eligible based on income. This might happen if a person cannot pay the required monthly premiums and, as a result, gets penalized with a six-month lockout period from coverage.
Managed Care Organization or Managed Care Plan (MCO) Private companies who administer the Medicaid program in Kentucky. Each Medicaid member is assigned a managed care plan, though they can then choose another one. These companies have their own provider networks and different cost-sharing requirements, such as copays. Currently, Kentucky MCOs include Humana CareSource, Aetna Better Health, WellCare of Kentucky, Anthem Blue Cross and Blue Shield Medicaid, and Passport Health Plan.
Medically Frail Individuals with disabling conditions. These include serious mental illness, chronic substance use disorder, complex medical condition, or another physical, intellectual, or developmental disability that significantly impairs a person’s ability to perform one or more activities of daily living.
Medicaid A joint federal and state insurance program that provides free or low-cost health insurance to some low-income adults, parents and their children, pregnant women, the elderly, and people with disabilities. Many states, including Kentucky, have now expanded their Medicaid eligibility to include all individuals below a certain income level.
My Rewards Account A spending account for Medicaid members outlined in Kentucky’s 1115 Medicaid Waiver proposal. Members can accumulate funds in the account upon completion of specified health-related activities or community engagement activities to access benefits not otherwise covered, such as dental care, vision services, and over the counter medications.
Non-Payment Penalty Consequences for failure to pay Medicaid premiums. Kentucky’s 1115 Medicaid waiver proposal includes a number of penalties based on income.
Open Enrollment The yearly period when people can renew and enroll in health insurance plans. Currently, Kentucky residents can enroll and re-enroll in Medicaid anytime. Kentucky’s 1115 Medicaid Waiver proposal includes an open enrollment period for some adults on Medicaid.
Retroactive Coverage Medicaid coverage may have a backdated start date to cover already received medical services for up to three months prior to the month of application. This only applies if the individual would have been eligible during the retroactive period had he or she applied at that time.

This glossary explains Medicaid terms but is not a legal document.

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