History

Medicaid was authorized by Congress under Title XIX of the Social Security Act in 1965. It is a means-tested entitlement program that provides health care coverage for certain groups of people who reside in the United States. The federal government provides matching funds to states that agree to participate, and the program is administered by each state. On the federal level, Medicaid is overseen by the Centers for Medicare and Medicaid Services (CMS), previously the Health Care Financing Administration (HCFA), which is under the U.S. Department of Health and Human Services. Each state government designates one agency to administer its Medicaid program, and some states call their Medicaid program by a different name. For example, Medicaid is called “Medi-Cal” in California. New Jersey’s Medicaid program is explained below.

Federal funding ranges from 50% to 80% of a state's Medicaid costs, based on a state's per capita income. Medicaid requires states that participate to cover a certain range of services for specific categories of individuals. A state can choose to cover additional services and still receive federal matching funds. All states now participate in Medicaid. In certain instances, such as the State Children's Health Insurance Program (SCHIP) and its expansion to cover parents of low-income children, states receive an enhanced financial match from the federal government.

New Jersey has participated in Medicaid since 1970. The program is currently administered by the Division of Medical Assistance and Health Services (DMAHS), which is under the direction of the New Jersey Department of Human Services. Besides the federally mandated services, New Jersey also provides most of the optional programs that have been authorized by CMS. There are presently over 900,000 people receiving Medicaid benefits in New Jersey.

Until 1995, Medicaid services in New Jersey were provided by Medicaid-participating providers who treated beneficiaries and billed Medicaid directly for the services they provided. However, due partly to low rates Medicaid paid, it was very difficult for Medicaid beneficiaries to find providers in the state who would accept Medicaid patients.

In 1995, Medicaid contracted with health maintenance organizations (HMOs) to provide Medicaid-covered services to pregnant women and families with children who were receiving Medicaid based on their eligibility for welfare assistance. Since that time, except for children supervised by New Jersey’s Division of Youth and Family Services (DYFS), Medicaid beneficiaries who are residing in nursing facilities or in-home and community-based waiver programs, and those Medicaid beneficiaries who also receive Medicare, most Medicaid beneficiaries in New Jersey are required to join a Medicaid-participating HMO to receive most of their health care services. There are currently six Medicaid HMOs in New Jersey. See NJ Medicaid & Managed Care (from the New Jersey Division of Medical Assistance and Health Services).

Beneficiaries

To be eligible for Medicaid, a person must meet certain categorical requirements and financial standards. A person must also be a resident of New Jersey and a U.S. citizen or qualified alien who entered the U.S. either before August 22, 1996, or have resided in the U.S. for at least five years.

There are many Medicaid categories of eligibility with varying income and resource standards. There are also many Medicaid programs that provide coverage for specific medical conditions and needs. However, the general categories include the following:

• Families with children up to age 18
• Pregnant women
• Children
• Certain young adults between the ages of 18 and 21
• People who are 65 years of age and older, or blind or disabled, which includes persons who are receiving Supplemental Security Income (SSI) and some persons who lose SSI for financial reasons
• Persons who would be eligible if institutionalized but who are receiving care under home and community-based waiver programs
• Uninsured women with breast or cervical cancer
• Certain undocumented immigrants who require emergency care
• Certain low-income Medicare beneficiaries.

New Jersey has also opted to provide a "medically needy" program for certain categories of individuals who would otherwise be eligible for Medicaid except that they have income or assets that exceed the Medicaid limits. This option allows pregnant women, children under the age of 21, and persons who are aged, blind, or disabled to spend down their excess income on documented medical expenses to meet Medicaid eligibility limits.

Services

In order to receive federal matching funds, Title XIX of the Social Security Act requires states to provide certain basic services to specific categories of persons under the state's Medicaid program. The following services are federally mandated:

• Inpatient and outpatient hospital services
• Physician services
• Medical and surgical dental services
• Nursing facility (NF) services for individuals aged 21 and older
• Home health care for persons eligible for NF services
• Family planning services and supplies
• Rural health clinic services and any other ambulatory services offered by a rural health clinic that are otherwise covered under the State Plan
• Laboratory and x-ray services
• Pediatric and family nurse-practitioner services
• Federally qualified health center services and any other ambulatory services offered by a federally qualified health center that are otherwise covered under the State Plan;
• Nurse-midwife services (to the extent authorized under State law)
• Early and Periodic Screening, Diagnosis and Treatment (EPSDT) services for individuals under 21.

States may also receive matching federal monies if they choose to provide other Medicaid-covered services. New Jersey provides these optional Medicaid-covered services to eligible individuals:

• Treatment in residential treatment centers
• Optometry services and eyeglasses
• Dental care
• Prescription medicines
• Chiropractic services
• Psychologist services
• Prosthetics and orthotics
• Podiatry services
• Prescription medicine necessary during long-term care
• Durable medical equipment
• Hearing aid services
• Transportation
• Personal care services
• Licensed practitioner services
• Private duty nursing
• Services in a clinic
• Physical, occupational and speech therapy
• Inpatient psychiatric care for individuals under 21 and over 65
• Intermediate care facilities for the mentally retarded.

Applying for Medicaid in New Jersey

In New Jersey, the county boards of social services (often called county welfare agencies) accept applications for Medicaid. Some county boards also have “outstation” workers at local hospitals to assist patients who want to apply. The list of New Jersey’s county boards of social services and the application process is explained in Applying for Medicaid in New Jersey.

This information last reviewed 3/21/10.