In the case of working-age adults with serious mental illnesses, the main pathway to Medicaid eligibility is via the SSI program, either by being a SSI cash assistance beneficiary or by meeting SSI-disability criteria and securing eligibility through another optional eligibility group (e.g., medically needy). Meeting SSI disability criteria is decisive (except for individuals who are medically improved in TWWIIA states that include such individuals). Because of the stringency of SSI/SSDI disability criteria, low-income individuals with serious mental illnesses who qualify for Medicaid through the SSI pathway have especially challenging impairments and, therefore, would benefit from the provision of rehabilitative and other services. The same is true of adults in TANF households who have serious mental illnesses, even though they might not meet SSI disability criteria.
Federal Medicaid law and policy give states important latitude in extending Medicaid eligibility beyond SSI cash assistance beneficiaries. In particular, individuals who are SSDI beneficiaries but do not receive SSI can be included in a states Medicaid program in various ways, including the 100 percent of poverty option or the medically needy option. These SSDI beneficiaries must meet the same disability tests as SSI beneficiaries. A large proportion of SSDI beneficiaries have mental disorders, including serious mental illnesses.
Medicaids overall role in meeting the needs of working-age adults with serious mental illnesses in any particular state hinges to a significant degree on a states policies concerning the coverage of people with disabilities. In states that have broadened Medicaid eligibility for people with disabilities, a greater proportion of individuals with serious mental illnesses are able to receive Medicaid-funded services. As a result, other resources can be used to meet the needs of a greater number of persons who do not qualify for Medicaid, and other investments can be made in community mental health services. To the extent that a states Medicaid eligibility policies also help overcome disincentives to work (either by invoking the options for workers with disabilities or the flexibility available under §1902(r)(2)), individuals can be encouraged to enter the workplace because they can maintain Medicaid coverage and thereby have ongoing access to Medicaid community mental health services.
For people who obtain Medicaid eligibility, a state may offer vital benefits that will assist their recovery and address other important needs. Chapter 4 describes the types of benefits that states may offer to individuals with serious mental illnesses.