AIDS TREATMENT NEWS No. 257 - October 18, 1996
John S. James

California State Disability Income

ATN: How does California disability income insurance work?

Fortuno: The California program is very easy to interact with. It goes by a physician's signature, and trusts that that signature, should it ever need to be questioned, would have a medical record which would support it. Whereas [Federal] Social Security wants to see the medical record.

California disability is a one-year program which is insurance, just the way Social Security is insurance.

ATN: So for California disability, since it is insurance, your assets do not matter?

Fortuno: Correct. That means you paid in, and it's going to be based on what you paid in. And not everybody pays into state disability. Your employer can choose another program, and as long as it is better than state disability in some ways, your employer can have that. For example, people who work for UCSF do not pay into state disability -- but they do pay into Social Security.

ATN: I heard that with the state disability, it is important that you go on it before being fired for not being able to do the job properly.

Fortuno: If you are finding that you are unable to work, you need to get information on your benefits, and talk to your doctor about his opinion of how long you should continue working. This is very important. However, even if you do lose your job first, we can often recapture benefits. The key is, does the medical record support the disability; if it does, we have been extremely successful in regaining any benefits connected to state disability and Social Security.

Medicare

ATN: After 29 months of disability, one becomes eligible for Medicare, which does not cover prescriptions. How does one handle that?

Fortuno: Finding ways to create the pieces of the puzzle to create the whole picture of coverage for Medicare really depends on the individual's situation. What we have found is that different people use different pieces of the puzzle. It depends on the individual's assets and what their disability income is. We always find successful ways that people can access the full coverage that they are accustomed to, or that is available to them, when they become eligible for Medicare.

Sometimes for individuals who have high disability income, and they come to the event of Medicare, getting an association insurance that will couple with Medicare is the successful way that they deal with prescription coverage, and covering the copayments.

Medicare HMOs is another way to work with Medicare. There is no blanket statement on it; it depends on the individual to solve the puzzle of getting full coverage from Medicare. There are various Medicare supplements, but many of them are not that good, and many have very limited prescription coverage. There are also some supplements available through an employer's group coverage, but not available to the public.

ATN: An HMO might offer a deal where, if you accept managed care, it will give you some prescription coverage?

Fortuno: Usually a very small amount. And then, depending on the disability income, and the assets, the individual might use ADAP, or even possibly Medi-Cal with ADAP. But in some cases that is not the best option, and they are better off with getting insurance through an association (to handle prescription coverage especially). For example, say somebody has $70,000 per year disability income -- they do not qualify for ADAP or Medi-Cal, and they also need prescription coverage, or all that money could be gone on prescriptions. A way to get them coverage is to find an association that has policies that will coordinate with Medicare.

The key thing to remember about Medicare is that if your health-insurance policy says "Medicare eligibility," that applies if you *qualify* for Medicare -- whether you enroll or not.

ATN: If your policy says it will stop covering certain benefits once you become eligible for Medicare?

Fortuno: Right, that just means becoming eligible -- not whether you elect Medicare. Many people read that and interpret it in a more convenient way, and then they get into trouble.

ATN: You mean that once they become eligible, they ought to get onto Medicare?

Fortuno: Yes, because their insurance company will deduct for that coverage, or cancel the coverage which they had previously. Not all health-insurance policies do that, but in my experience about 85% do.

ATN: You mean that if you have private insurance, and become eligible for Medicare, you could lose that insurance?

Fortuno: Yes, you could lose eligibility for your previous insurance. It depends on the individual policy.

This doesn't mean that your options are closed. It means that you need to find a different way to continue to get full coverage. That can be done successfully.

Other Questions and Issues

ATN: What about the lifetime cap problem with private health insurance?

Fortuno: Lifetime caps are generally high; most insurance policies have a million, or five million dollars. But it is something you want to look at. In five years of counseling I have not met any clients that have met their lifetime caps-- but it could happen, especially with inferior insurance products. I do not know if you could avoid a lifetime cap by switching plans during open enrollment.

Where caps certainly do become a problem is with self-insured trusts, when people create a self-imposed cap by using the insurance prematurely. People do that because they do not understand that they are in a self-insured trust which has that rule. This one-year rule is common with self-insured trusts. It is a problem that a lot of people have. [See Part I of this interview for background on self-insured trusts.]

ATN: What do you do if an insurance company disputes a claim?

Fortuno: We refer people to the AIDS Legal Referral Panel. (See "Getting Your Insurer to Cover New HIV Treatments: A Crash Course," by Irwin E. Keller, AIDS Legal Referral Panel of the San Francisco Bay Area, AIDS TREATMENT NEWS #238, January 5, 1996.)

ATN: What are the pros and cons of keeping certain information out of your medical record?

Fortuno: There are two schools of thought here, which come together at one point. The main issue is, if your benefits are in order, meaning you have a good long-term disability income plan, and you have health insurance that's in place, and you have a fair to substantial amount of life insurance, then having your medical records be truthful and honest is not going to work against you, because you know you can always change health plans (in California at least).

But if you are not sure of your benefits, if your benefits are not in order, then you may consider -- and I do not always recommend it -- you may consider having a physician who will keep a separate file. But many physicians are not doing that any more. Even so, many of my clients who have pre-existing conditions are still able to manage their benefits affairs and get things in order to where they do well. It is not the end of the world if you have a disclosed medical record.

ATN: What could be said about private disability income insurance?

Fortuno: That topic is big enough for a separate interview.

ATN: Several years ago I knew someone who had private disability income insurance. When he obtained the policy he was asked if he ever used illegal drugs, and he said no. But he was also in a clinical trial, and he told the researchers that he had smoked marijuana in the 1960s, so his disability income was cut off.

Fortuno: How long did he have the policy in place before he went to use it?

ATN: I don't know.

Fortuno: I would get an attorney involved in such a case, and check how long he had the policy. If he had it for more than two years, it becomes incontestable, regardless of what statements he made.

ATN: But couldn't the company charge fraud and contest it that way?

Fortuno: After two years, I have not seen it happen. I have seen many people get away with false statements, after having the policy for two years.

ATN: Are there California programs that can pay private insurance premiums?

Fortuno: Yes, there is Care HIPP, and the Medi-Cal HIPP program. These in themselves could be a whole article. They are based on disability income. They pay the cost of the health-insurance premium, if someone has health insurance.

ATN: What should people know about managed care under Medicaid (Medi-Cal)?

Fortuno: We have not yet seen what it will look like. The principle makes sense, but we do not know about income rules, etc. It could change from other areas when it is implemented here.

ATN: What is the difference between SSI and SSDI?

Fortuno: The way I explain the difference between SSI and SSDI to my clients is this. Social security has two programs. The Social Security Disability Insurance, SSDI, is disability insurance. Basically what you are doing is gaining access to your old-age pension income early, via an insurance clause. The amount you get reflects what you paid into the system, via the FICA payroll tax. You can access this program if you meet the disability criteria; they are not concerned with your assets or other income.

SSI, on the other hand, is a form of "welfare" Social Security, for individuals whose disability income, because of what they have paid into the system or have not paid into the system, is below approximately $628. It supplements an individual's income up to about $628. It also follows the same access rules as Medi-Cal (one car, one house you live in, and $2000 in the bank.)

ATN: What about the California program for people turned down by health insurance?

Fortuno: It's not the most effective program available now. It's called the MRMIP program (California Major Risk Medical Insurance Program), and it is a last resort that I have not been using for over a year. We have found more successful ways to assist people. But it depends on the individual.

The key thing is that today, getting insurance through associations seems to be the better option for individuals who in the past have had to use this MRMIP program.

ATN: Is it correct that if you could use an association, you could also use an employer's group health insurance, if you get a job?

Fortuno: Right. But if you happen to be self-employed, or working for an employer who does not have any suitable program, then the association may be the route. [For background, see Part I of this interview.]

Getting Benefits Advice

ATN: Is the AIDS Benefits Counselors program open to persons outside of San Francisco?

Fortuno: ABC is for San Francisco residents. We are too small. But we do offer provider training, for people who want to learn, and we are working with other agencies to create some better literature for the people who provide services, in addition to more simple-language information for clients to be able to understand their benefits. That is something we are developing.

My greatest concern is getting as many people as we can the knowledge that they need so that they can handle their affairs. We don't do case management; we are educators, helping people to be empowered to manage their own affairs, and then providing them with the additional support that they need when a specific problem comes up, or a referral to another agency, such as the AIDS Legal Referral Panel, or to other agencies for housing, or for other needs. That is how we view ourselves.

Outside of San Francisco there are other agencies. A good way for an individual elsewhere in California is to find their local AIDS Legal Referral Panel, and challenge them to be able to provide them with benefits information.

ATN: What about the big AIDS service organizations in different cities?

Fortuno: Not necessarily. In some cases people in social services may understand one aspect of benefits, but for example they may not understand the rules of insurance policies. People may have expertise in a specific area. If what you need is not in their area of expertise, you could be ill advised.

ATN: What are some simple printed materials people can get to study further?

Fortuno: Most printed material now available is very much in the benefit-insurance language style that leaves people confused. That is why we are working to develop better material.

What a person can do is to begin to read the information that they have (with their health-insurance policies, etc.), and allow themselves to digest it in a way that they understand that the benefits usually operate from a set of rules that are independent to each program -- and know that there is a way that they coordinate together -- in any benefit scenario.

ATN: What general advice could you leave for our readers?

Fortuno: I tell my clients that benefits are like a dysfunctional family. You have independent family members who have specific ways that they are to be interacted with, which may change. But the family does operate as a unit -- however that dynamic plays out. Benefits are that way. If you try to make common sense of benefits you'll never understand them. It's a matter of just learning the rules, taking notes, figuring out what applies to you and what doesn't apply to you. Just because a benefit exists does not mean that it is one that you will need, or that you will qualify for. It's not, "I have AIDS and therefore should be able to access everything," it's finding out which programs are going to best serve me, and what is the best way for me to be able to get my needs met. It varies from person to person. That's the difficult part that people have with them.

There is always a way to make it work -- if you do prior planning. You don't plan on how to deal with an automobile accident after the accident. You plan ahead of time by having good automobile insurance, so if something were to happen, you can focus on dealing with the situation at hand, not "am I covered."

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