Two residents with disabilities sue state over Medicaid limits

Laura DiErrico had a history with Connecticut's Medicaid program long before she joined a lawsuit against the department that administers it.

Originally from Madison, she relied on Medicaid while raising her son as a single mom before moving to Florida around 2000. She was diagnosed with multiple sclerosis, a chronic, degenerative disease that affects the central nervous system, in 2019 and moved back to the Nutmeg state the following year.

Getting used to the cognitive and physical changes DiErrico was experiencing has been challenging and painful. She said her MS diagnosis impacts her memory and mental abilities, making it hard for her to keep up with typical office work, so her income comes solely from a monthly $1,724 Social Security Disability Insurance payment.

Despite the low monthly income, DiErrico can't access state Medicaid coverage at the moment due to what advocates describe as discriminatory eligibility income and asset limits on the program for residents with disabilities compared to the others impacting access to essential health care.

DiErrico is one of two plaintiffs represented by Disability Rights Connecticut and the Medical-Legal Partnership Clinic in a civil rights lawsuit against the state Department of Social Services. Filed in April, the complaint claims that the state's Medicaid eligibility categories prevent disabled residents from participating in the program, violating the state Constitution's equal protection clause.

The suit names Commissioner Andrea Barton Reeves as the defendant. A spokesperson for DSS and the Office of Gov. Ned Lamont said the department doesn't comment on pending litigation.

"Whatever the reason or intent behind Connecticut's differential standards for disabled and non-disabled people in accessing Medicaid, the effect is the same: Plaintiffs and people like them cannot access Medicaid and thus cannot access needed healthcare," according to the complaint reviewed by CT Insider.

Connecticut's Medicaid program, more commonly known as HUSKY, is set up to offer coverage based on specific federally-required categories with options to expand to other populations. Despite having similar benefits, the eligibility regarding income and assets varies between plans, some of which are set federally, while the state sets others.

For example, the HUSKY D plan covers an expanded population of adults under 65 who don't fall into another eligibility category and have household incomes below 133% of the federal poverty level, plus a 5% income disregard, or around $1,732 a month with no asset limits.

Under federal law, states can cover residents who are disabled, blind and elderly --HUSKY C --at any income level. Yet, currently set at the lowest of any of the Medicaid programs -- $1,370 -- with asset limits of $1,600 and $2,400 for singles and couples.

Typically, if a resident's income is too high to meet the limit of one coverage plan, they often have the option to see if they fit within the requirements for a different plan, specifically HUSKY D. The lawsuit argues, however, that people with disabilities don't have the same opportunity since they are only categorically eligible for the state's Medicaid on the HUSKY C plan.

Many individuals with disabilities, like DiErrico, rely on federal checks as their primary source of income, which are often calculated based on past income. So, if a person's monthly check exceeds the income limits, they are immediately ineligible for HUSKY C.

Efforts in the past have been made to change income and asset limits in the various HUSKY plans to mixed results, said Sheldon Toubman, litigator at Disability Rights Connecticut and attorney on the lawsuit. A bill signed into law in 2023 raised the income limit of Husky C to match Husky D, but the change was pulled back before the law went into effect in October 2024.

The lawsuit specifically alleges that the significantly lower income limits on HUSKY C and other eligibility criteria compared to the programs for non-disabled residents violate the equal protection clause in both the federal and state Constitutions. The lawsuit asks for a "declaratory judgment" that the state is violating the Constitution's equal protection provision and that DSS immediately move to raise the HUSKY C income limit to at least as high as the income limit for HUSKY D.

"Not only is it unfair that you impose a more strict test for people with disabilities, but they actually need to benefit more," Toubman said. "It's illegal, anyway, under the Constitution, but it's particularly harmful because you're singling out the group for worse treatment, who most needs the benefit."

Broad impact

When DiErrico moved back to Connecticut, she actually had Medicaid coverage through the HUSKY D program thanks to federal COVID-19 expansions that made her eligible. Those expansions have expired, and she hasn't been able to re-enroll in Medicaid coverage after becoming eligible for Medicare through her disability checks. Her income is around $350 above the HUSKY C limit.

She enrolled in Medicare and Medicare Advantage; however, the access isn't the same. Some benefits available under Medicaid but not Medicare include dental care, vision care, hearing aids, long-term care, most home health care, non-emergency medical transportation services, and many medical equipment.

DiErrico said she's grateful for the Medicare coverage since it helps cover her regular appointments and medications, but she still struggles to afford other health care services.

Soon after losing her HUSKY coverage, DiErrico said she took a bad fall and cracked her two front teeth. Medicare Advantage maxed out its coverage, but DiErrico was still left with a $4,000 bill that she couldn't afford and would've been covered under Medicaid.

Advocates warn that the income and asset limits impact a broader community than people realize, like Rick Famiglietti of New Haven. In 1985, when he was 20 years old, Famiglietti was unstoppable. That is until he lost control of his motorcycle and crashed, leaving him with a spinal cord injury and quadriplegia.

In the years following, he turned to advocacy. He was one of several people who helped create the state's MEDConnect program that offered Medicaid coverage to employed people with disabilities back in 2000.

"I fought to work. I went back to school, found out I couldn't afford to go to work, and then I got involved with legislation that allows me to go to work," he said. "Now I'm stuck in a hard place."

Although he's ready to retire from his over 20-year career as a consumer service advocate at the Center for Disability Rights, Famiglietti continues to work knowing he'd lose the Medicaid coverage due to the state's strict eligibility criteria, just like everyone else who has been relying on MEDConnect.

"Back then and even today, if I stop working today, and my assets in my checking account are more than $1,600, I completely lose Medicaid the very next day," said Famiglietti, who is not a plaintiff on the lawsuit. "Which means I lose my medications. I lose my durable medical supplies. I lose my nondurable, durable medical supplies, and nobody's going to pay for my doctor visits."

Famiglietti said the income limits also apply more broadly than people realize since people 65 and older automatically become eligible for Medicare and may be subject to the same income and asset limits the disabled community faces.

Continuing the fight

The lawsuit, however, isn't the only attempt on the books to change HUSKY C. The asset limits on HUSKY C are also a barrier that ultimately makes it hard for people with disabilities to save for an emergency or investment and legislators are considering a bill to help fix it, said Kathy Flaherty, executive director of Connecticut Legal Rights Project.

Flaherty said the asset limits in particular were set in the 1970s and haven't been indexed to inflation in any way. When a person goes over the asset limit, she said, they become "trapped in ineligibility" when accessing Medicaid.

The proposed legislation aims to raise and then eliminate them gradually. However, the bill faces the same enemy it's predecessor did - a high fiscal note, meaning it could be costly to implement at a time when Connecticut is watching its expenses. The number of people that would become eligible is currently unknown, according to the report from the Office of Fiscal Analysis.

State Rep. Anne Hughes, D- Easton, has been a longtime advocate of raising the income and asset limits on HUSKY C after a career as a social worker.

She described the eligibility laws as "really outdated" based on a negative, paternalistic view of people with disabilities and who deserves health care, showing public support for the lawsuit. It also relied on a system based on unpaid, full-time at-home caregivers, which isn't sustainable today.

Hughes said the asset limit in particular places people with disabilities between choosing to have more than $1,600 in assets or losing health care. Ultimately, the goal is to modernize the system with "punitive policies that punish people and think you need to be adequately poor in order to have health care."

"I stand with the people that had hope that they could see a pathway forward, and then that hope was ripped away, after we pulled it from the budget," she said. "We're playing with people's lives, and these are the most vulnerable people that are just trying to survive."