Currently, through the Medicare Savings Program, the state Department of Social Services (DSS) pays Medicare Part B premiums for low-income elderly and disabled adults earning less than 246 percent of the federal poverty level, or about $29,667. Part B covers things like doctor visits, lab tests and outpatient care. Those earning less than 234 percent of the poverty level, or about $28,220, can receive additional help covering co-pays, deductibles and prescriptions.

In the new year, only those earning less than 100 percent of the poverty level—or $12,060—will qualify to receive all benefits under the program, and those receiving subsidies for premiums alone must earn less than 135 percent of the poverty level to be considered for eligibility. The Medicare Savings Program gives enrollees access to some benefits of the Medicaid program, which is a federal-state partnership.

“People are alarmed. They’re scared,” said Kristen Noelle Hatcher, managing attorney of the benefits unit at Connecticut Legal Services, a poverty law practice. “This is life-changing for a lot of them.”

Once the change occurs, the new income eligibility will be at the federal minimum, the same level used by 45 other states, according to DSS. Connecticut will remain one of only eight states that do not have an asset test for eligibility, according to the department.

Most people likely won’t know they are losing coverage until they receive written notices next month, according to Rosana Garcia, policy associate at the Universal Health Care Foundation of Connecticut, an advocacy group.

The change will force some seniors and disabled people, many of whom live on fixed income, to make tough decisions, Hatcher said. Some may skip medication doses, pick and choose which doctor appointments to attend, and make other sacrifices.

“They’re going to be having to make choices on what to spend their money on,” Hatcher said. “They do what they need to do to get by.”

Jonathan Miller, 27, of Meriden, worries he won’t be able to afford medications and treatments for his cystic fibrosis. His symptoms became so severe three years ago that he can no longer work. The Medicare Savings Program, which he joined in June, covers his premiums and prescriptions.

“I will be drastically impacted,” said Miller, who receives Social Security disability income and supplemental money from a long-term disability policy. “My income is too high to qualify for any other state-funded health coverage.”

Looking ahead, he said his best option would be to gain coverage under MedConnect, a Medicare plan that lets disabled individuals earn up to $75,000 a year in income as long as they are employed. He is actively job hunting, even though working is physically difficult for him and against his doctors’ advice.

He may also be able to get a Medigap plan, private coverage that supplements original Medicare benefits, he said. But he worries about the expense as well as the time it could take to get approved and enrolled.

He also doesn’t know whether his Medicare Savings Program access will be gone as of Jan. 1 or whether he may be able to keep it until June, since he was approved last June for a year of eligibility.

“I don’t have the luxury of waiting to find out. I can’t risk going a day without coverage,” said Miller, who spends four to five hours a day managing treatments and medications. A single trip to the hospital would cost him thousands of dollars out of pocket, he said.

In addition to the Medicare changes, the new budget also reduces income eligibility for HUSKY A, the program that provides coverage to low-income children and their parents or caregivers. Currently, adults in families earning 150 percent of the federal poverty level, or about $36,900 for a family of four, or less are eligible. The new budget will limit eligibility to adults in families earning less than 138 percent of the federal poverty level, or about $33,948.

Pregnant women and children enrolled in HUSKY A won’t be impacted by the cuts, according to DSS. Additionally, most HUSKY A recipients who will be affected won’t feel the impact until 2019, according to DSS, because they meet qualifications that require the state to provide them with 12 months of Transitional Medical Assistance.

The income level reduction will bring the state in line with most other states, according to DSS, and will make income eligibility for HUSKY A the same as that for low-income adults under HUSKY D, according to DSS.

This is the second time the HUSKY A eligibility income level has been dropped in recent years; it was lowered two years ago in the last state budget, Garcia said. It’s now at the federal minimum, she added.

“Our big concern is what will people do for coverage,” she said, noting many on HUSKY A can’t afford to buy insurance plans on the exchange, even with available subsidies.

In all, the latest biennial state budget cuts more than $120 million in funding from Medicaid and Medicare over the 2018 and 2019 fiscal years, according to Connecticut Legal Services.

Other Medicaid cuts in the budget include: reducing the primary care enhanced reimbursement rate, eliminating home health add-on payments, and capping adult dental coverage for non-emergency services at $1,000.

The cuts may not be as cost effective as lawmakers hope, Garcia said, particularly if patients resort to more costly emergency room care once situations become dire.

“People are not going to get the care they need. When things are really in crisis mode, they’re going to go to the ER and that’s not a sustainable way to provide health care,” she said. “It just feels like we’re really not living up to our promise to people.”

Two waivers in particular—Affordable Care Act (ACA) Section 1332 and Medicaid Section 1115—would let the state disregard certain federal requirements, possibly lowering health care costs for some individuals, according to a policy brief commissioned by the Universal Health Care Foundation of Connecticut and the Connecticut Health Foundation.

“What we need to do in Connecticut is really think about … how could we creatively, imaginatively, innovatively use waivers to expand coverage to quality care and really help improve health,” said Frances Padilla, president of Meriden-based Universal Health Care Foundation of Connecticut. “We haven’t had that conversation yet in Connecticut.”

The ACA waiver isn’t available until 2017 but the Medicaid waiver is already being used by dozens of other states to lower costs, she said.

“It allows a state to get past some of the requirements of Medicaid and do some things that are innovative,” she said of the Medicaid waiver.

Exploring the Medicaid waiver is particularly timely, Padilla said, because many enrollees are being bumped from Medicaid due to budget cuts, and many aren’t enrolling in insurance plans via state’s Access Health CT marketplace as was the hope.

A growing number of Connecticut residents have gained health insurance since the passing of the Affordable Care Act, but many aren’t using it because of expensive deductibles and co-pays, she said.

Access Health CT announced in late January that it enrolled nearly 109,000 people in private health insurance plans.

“We’ve come a long way with the ACA but there is not perfection with it,” agreed Patricia Baker, president and CEO of the Hartford-based Connecticut Health Foundation. “Affordability is such a huge issue for everyone. The conversation [about waivers], we believe, is absolutely important.”

Forty-three states and Washington, D.C., use at least one Medicaid Section 1115 waiver, according to the brief, which was authored by analysts at the University of Massachusetts’ Center for Health Law and Economics.

The waiver, according to the brief, lets states disregard many aspects of their Medicaid plan if the federal Centers for Medicare and Medicaid Services determine it makes sense and is cost effective.

The waiver can let states raise income eligibility limits and add benefits that aren’t usually covered by Medicaid, among other things. Once states apply for the waiver, it usually takes months or years to negotiate terms and gain approval, according to the brief.

On Aug. 31, some Connecticut residents lost their ability to qualify for HUSKY A, state Medicaid that covers low-income children and teens, under a state law that changed income eligibility standards. The change lowered the income eligibility level for parents and caregivers—from 201 percent to 155 percent of the federal poverty level—meaning those earning more than 155 percent of the poverty level no longer can receive HUSKY A.

If Connecticut were to pursue it, the state would need to file an application with the U.S. Department of Health and Human Services. Legislative approval is not required.

The forthcoming ACA 1332 waiver will let states opt out of major components of the Affordable Care Act, including the mandate that a state-run marketplace (Access Health CT) exist. To get the waiver, states will have to prove that alternative programs would provide equally comprehensive coverage to a comparable number of people without increasing the federal deficit, according to the brief.

The brief outlines potential pitfalls to using the waivers. Among them: state finances could be at risk if projected federal revenue to support programs falls short; political changes could jeopardize waiver programs that require federal approval; and using waivers could hurt Access Health’s clout and financing base by taking people out of the marketplace.

“There’s always the good, the bad and the ugly,” Padilla said, so any waiver needs to be researched before deciding whether to proceed.

Connecticut currently participates in 11 Medicaid waiver programs, according to David Dearborn, spokesman for the Department of Social Services (DSS) that administers the state’s Medicaid program. DSS has overall responsibility for the waivers, he said, but five of them are under DSS directly, five are under the state Department of Developmental Services and one is under the Department of Mental Health and Addiction Services. Connecticut’s existing waivers pertain to early childhood autism, acquired brain injuries, personal attendants and a state home care program for elders, among other things, Dearborn said.

Using the waivers has made the state a “national leader” when it comes to “creative and effective ways of adapting Medicaid rules” to provide home- and community-based services to people who otherwise would need nursing home care or institutionalization, he said.

“There’s already a lot of positive action going in Connecticut,” he said, with the state taking innovative steps to expand Medicaid’s reach.

Similarly, even more state residents could potentially access services under ACA Section 1332 and Medicaid Section 1115 waivers, Baker said.

“There’s nothing intrinsically good or bad about waivers, but they are an opportunity that this state should explore,” she said.