Waiver Fact Sheet
What is the MFTD Waiver?
The Medically Fragile and Technology Dependent Waiver (MFTD Waiver) is one of Illinois' home and community based services waivers. It is a Medicaid program that the federal government has granted to the state of Illinois to prevent costly institutionalization and permanent hospitalization of children with catastrophic medical conditions and expenses. It is called a "waiver" because it waives standard Medicaid rules by evaluating only the child's income when calculating eligibility. Otherwise, children are eligible for Medicaid only while living in an institution/hospital, but not once they return home unless their family qualifies financially for Medicaid. Virtually every state has some form of this program. See About the Waiver for more information.
Who uses this program?
Most children on this waiver are ventilator-dependent, have tracheostomies, or have central IV lines, and require extensive care and services. Most waiver expenses are used to provide home nursing care for these children, which is typically not covered by private insurance. Without this waiver, 95% of these children would require permanent hospitalization to receive their care. The capacity of the waiver is 700 children, and at any time there are approximately 500 children in the program.
How does the MFTD Waiver save money?
If these children cannot be cared for at home, 95% would require permanent institutionalization in a hospital. The average cost for hospitalization in a pediatric hospital is $55,000 per month, while the average cost for children on the waiver cared for at home is $15,684 per month. It costs THREE TIMES AS MUCH to hospitalize or institutionalize these children as it does to care for them at home! Only 23 children would need to be permanently hospitalized to erase the $15 million Governor Quinn hopes to cut from the program's budget.
Here are examples of children's cost comparison analyses to illustrate exactly how this program saves money:
See this new study from Illinois' Health and Medicine Policy Research Group which states:
cuts to home care...ultimately do not result in cost savings; and investment in home care...ultimately results in cost savings. Medicaid home care cuts result in an overall INCREASE in Medicaid expenditures due to cost shifting to more expensive institutional care (nursing facilities, hospitals and emergency rooms).
The cost per child on the waiver has remained virtually flat over the past ten years when adjusted for inflation. In fact, the cost per person has decreased 7% compared to 2000. Because there can never be more than 700 children in the program, costs will never increase dramatically. This program contains costs dramatically for this population and has been fiscally responsible year after year.
Why is this program necessary?
Private insurance does not cover home nursing in most cases, and children from working and middle class families are only eligible for Medicaid if they live in an institution or hospital. This program allows these children to receive nursing care at home, dramatically lowering their expenses to the state. Families in this program would otherwise have to pay out-of-pocket for nursing care and other services currently covered by the waiver, which average $188,210 per year. Obviously, most families in Illinois are unable to pay such a high amount out-of-pocket each year.
Without the Waiver, children are eligible for Medicaid only if they live in an institution or a hospital. They lose their eligibility if they want to live at home unless their family qualifies financially for Medicaid. Currently, a family of 4 must earn less than $34,575 to qualify for Medicaid (without buying in). Families may buy-in to Medicaid for their children if their income is under $69,150 and they don't have private insurance.
It is impossible for a family who earns between $69,150 and $200,000 a year to pay the $188,210 per year for nursing care and other services, which is the average cost per child on the MFTD Waiver.
What would happen if the MFTD Waiver is eliminated or restructured?
The only options for families whose children lose the MFTD Waiver are:
- Permanently hospitalize their child, so the child then becomes Medicaid-eligible. This option would cost the state at least three times as much per child ($55,000/month in the hospital and $15,684/month at home). The entire burden of the child's care--90% of which may have been paid by private insurance previously--falls on Medicaid.
- Quit their jobs or reduce work hours to financially qualify for Medicaid. This would likely mean the entire family would lose their private insurance, and the entire family would become fully dependent on Medicaid, and potentially other state benefits as well.
- Give up custody of their child to DCFS. Because most of these children are so medically fragile, most would end up hospitalized or in institutions. The entire cost of the child's care would need to be shouldered by the state.
If these children are permanently hospitalized, they will take up a large number of ICU beds, especially in the Chicago area. These beds would be unavailable to children who are acutely ill, leading to a critical shortage of ICU beds.
Even if the Waiver is eliminated, many of these children will still need one-to-one nursing to attend school, and schools are mandated to provide this service. In this instance, local school districts would be responsible for paying the entire cost of nursing per child--about $50,000 per child.
These children WILL end up on Medicaid, one way or another. It is better to continue the current program, which has the lowest price tag.
What is Illinois' legal obligation to these children?
Waivers are optional programs, so the state is not required to offer them. However, multiple laws and legal decisions, including the Americans with Disabilities Act, the Supreme Court decision Olmstead vs. L.C. (1999), and the Affordable Care Act, support the right of citizens to be cared for at home and not in institutions. Any policy change that increases institutionalization, such as eliminating this waiver, is subject to legal redress.
What is Illinois' proposal for this program?
Initially, the Department of Healthcare and Family Services (HFS) recommended eliminating the waiver and creating a state program that would provide home nursing care for children who don't qualify financially for Medicaid. Thanks to our advocacy efforts, Governor Quinn has suggested renewing the program, but with a $15 million budget cut.
In May, the Illinois legislature passed SB 2840, the "SMART" Act, which states the waiver will be limited to families who earn less than 500% federal poverty line ($95,450/family of three) and will impose exorbitant copays and premiums on every hour of nursing care received. Hundreds of children would be cut out of the program and would end up hospitalized at three times the cost of home care. Many other families would be unable to afford the exorbitant copays and premiums and would lose eligibility and services as well.
On June 5 the state submitted its plan for the waiver to the federal government. This plan limits eligibility to children with a nursing facility level of care, even though 99% of children currently in the waiver are too fragile to live in a nursing facility and have a hospital level of care. Under this plan, the state would eliminate all children with a hospital level of care from the program. Read more here.
Wondering where we got our information? Visit our Sources page.