Budget Neutrality - A policy of the federal government, not enacted in statute, that federal costs under waivers must not exceed federal costs of operating the program without a waiver.

Categorically Needy C A phrase describing certain groups of Medicaid beneficiaries who qualify for the basic mandatory package of Medicaid benefits. There are A categorically needy@ groups that states participating in Medicaid are required to cover, such as pregnant women and infants with incomes at or below 133 percent of the Federal Poverty Level (FPL). These are mandatory categorically needy individuals. There are also A categorically needy@ groups that states may at their option cover, such as pregnant women and infants with incomes above 133 percent and up to 185 percent of the FPL. These are A optional categorically needy@ individuals. Unlike theA medically needy,@ A categorically needy@ individuals may not A spend down@ in order to qualify for Medicaid.

Copayment C A fixed dollar amount paid by a Medicaid beneficiary at the time of receiving a covered service from a participating provider. Copayments, like other forms of beneficiary cost-sharing (e.g., deductibles, coinsurance), may be imposed by state Medicaid programs only upon certain groups of beneficiaries, only with respect to certain services, and only in nominal amounts as specified in federal regulation.

Disproportionate Share Hospital (DSH) Payments C Payments made by a state= s Medicaid program to hospitals that the state designates as serving a A disproportionate share@ of low-income or uninsured patients. These payments are in addition to the regular payments such hospitals receive for providing inpatient care to Medicaid beneficiaries. States have some discretion in determining which hospitals qualify for DSH payments and how much they receive. The amount of federal matching funds that a state can use to make payments to DSH hospitals in any given year is capped at an amount specified in the federal Medicaid statute.

Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Services C One of the services that states are required to include in their basic benefits package for all Medicaid-eligible children under age 21. EPSDT services include periodic screenings to identify physical and mental conditions as well as vision, hearing, and dental problems. EPSDT services also include follow-up diagnostic and treatment services to correct conditions identified during a screening, without regard to whether the state Medicaid plan covers those services with respect to adult beneficiaries.

Expansion Group - A group to whom coverage is extended through a waiver. An individual in an expansion group would otherwise be ineligible for coverage under Medicaid.

Health Insurance Flexibility and Accountability (HIFA) Waivers C The term used by the Bush Administration to describe its demonstration initiative, using the section 1115 waiver authority, to encourage new comprehensive state approaches that will increase the number of individuals with health insurance coverage within current-level Medicaid and SCHIP resources.

Mandatory C State participation in the Medicaid program is voluntary. However, if a state elects to participate, as all do, the state must at a minimum offer coverage for certain services to certain populations. These eligibility groups and services are referred to as A mandatory@ in order to distinguish them from the eligibility groups and services that a state may, at its option, cover with federal Medicaid matching funds.

Medical Assistance C The term used in the federal Medicaid statute (Title XIX of the Social Security Act) to refer to payment for items and services covered under a state= s Medicaid program on behalf of individuals eligible for benefits.

Medically Necessary/Medical Necessity - Under Connecticut= s current Medicaid plan, medically necessary health care is health care provided to correct or diminish the adverse effects of a medical condition or mental illness; to assist an individual in attaining or maintaining an optimal level of health; to diagnose a condition or prevent a medical condition from occurring.

Medically Needy C A term used to describe an optional Medicaid eligibility group made up of individuals who qualify for coverage because of high medical expenses, commonly hospital or nursing home care. These individuals meet Medicaid= s categorical requirementsC i.e., they are children or parents or aged or individuals with disabilitiesC but their income is too high to enable them to qualify for A categorically needy@ coverage. Instead, they qualify for coverage by A spending down@ C i.e., reducing their income by their medical expenses. States that elect to cover the A medically needy@ do not have to offer the same benefit package to them as they offer to the A categorically needy.@

Optional C The term used to describe Medicaid eligibility groups or service categories that states may cover if they so choose and for which they may receive federal Medicaid matching payments at their regular matching rate, or FMAP. About two thirds of all federal Medicaid funds are used to match the cost of optional services for mandatory or optional groups and all services for optional populations.

Premium - A fixed dollar amount paid by a Medicaid beneficiary, usually on a monthly basis, to enroll or maintain enrollment in the Medicaid program. Premiums, may be imposed by state Medicaid programs only upon a very narrow class of beneficiaries, and only in certain amounts as specified in federal regulation.

Section 1115 Waiver C Under section 1115 of the Social Security Act, the Secretary of HHS is authorized to waive compliance with many of the requirements of the Medicaid statute to enable states to demonstrate different approaches to A promoting the objectives of@ the Medicaid program while continuing to receive federal Medicaid matching funds. In 2001, 19 states were operating Medicaid section 1115 waivers affecting some or all of their eligible populations and involving $27 billion in federal matching funds, or one fifth of all federal Medicaid spending that year. The waivers, which are granted (or renewed) for 5-year periods, are administered by CMS.

Section 1915(b) Waiver C Under section 1915(b) of the Social Security Act, the Secretary of HHS is authorized to waive compliance with the A freedom of choice@ and A statewideness@ requirements of federal Medicaid law in order to allow states to operate mandatory managed care programs in all or portions of the state while continuing to receive federal Medicaid matching funds. The waivers, which are granted (or renewed) for 2-year periods, are administered by CMS. Connecticut currently operates its HUSKY A managed care program under a 1915(b) waiver.

Spend-Down C For most Medicaid eligibility categories, having countable income above a specified amount will disqualify an individual from Medicaid. However, in some eligibility categoriesC most notably the A medically needy@ C individuals may qualify for Medicaid coverage even though their countable incomes are higher than the specified income standard by A spending down.@ Under this process, the medical expenses that an individual incurs during a specified period are deducted from the individual= s income during that period. Once the individual= s income has been reduced to a state-specified level by subtracting incurred medical expenses, the individual qualifies for Medicaid benefits for the remainder of the period.

State Plan Amendment (SPA) C A state that wishes to change its Medicaid eligibility criteria or its covered benefits or its provider reimbursement rates must amend its state Medicaid plan to reflect the proposed change. Similarly, states must conform their state plans to changes in federal Medicaid law. In either case, the state must submit a state plan amendment (SPA) to CMS for approval.