Legal Bulletin

November 16, 2001

Implications of the Proposed Medicaid Rule Changes on
People Seeking Funding for Augmentative Communication Devices

The Medical Assistance Administration (MAA), the division of the Washington State Department of Social and Health Services (DSHS) that administers the Medicaid program in Washington, has recently published a notice of proposed rule making that would significantly change the rules for coverage of Augmentative Communication Devices (ACDs), a class of devices used to replace speech for people with speech impairments. This was mentioned last week in the AT Legal News below, but there is a need to expand further on the content of those changes and their implications for people seeking funding for Augmentative Communication Devices. The changes can be found on the web at http://www.dshs.wa.gov/dockets/3002.html. This Bulletin will detail the substance of the changes and then discuss the implications.

The proposed changes will greatly limit what ACDs may be covered. The proposed changes will do this by means of new definitions and also by explicitly limiting what devices it will cover. If the proposed rules take effect, the definition of ACD will be changed so that they must be "dedicated," defined as

having the sole purpose of replacing speaking ability of a client who has a severe speech impairment, and
not able to "integrate or interact" with a computer system in a way that it may get a computer virus, and
medical in nature, and
useful only to a person with a severe speech impairment, and
not able to run any software other than for speech generation

The proposed rule changes also explicitly limit what devices will be covered. Medicaid will only cover those dedicated ACDs that have one of the following characteristics

Digitized speech output, using pre-recorded messages, or
Synthesized speech output or written responses that permit multiple methods of both formulating the message (e.g. spelling, icons, etc.) and also accessing the device.

In addition to limiting what Medicaid will cover, the proposed changes also add a list of excluded devices. In addition to personal computers, which the rules currently exclude, the list of excluded devices now includes

any computers or personal digital assistants (PDAs) that can be programmed to perform the functions of an ACD
any non-dedicated 'speech devices' (presumably ACDs)
any device that can run software other than for speech generation, and
any communication device that is useful to someone without a severe speech impairment (e.g. cell phone, pagers, walkie-talkies, etc.).

The implications of these proposed changes, if they take effect, could be great. There are many current devices on the market that are potentially excluded under these proposed rule changes, including devices that have been funded by Medicaid in the past when they were "medically necessary." Without mentioning particular brands and devices, these proposed changes limit all computer-based devices, even though those devices can often be more customizable to the individual person, and more expandable in terms of vocabulary, especially customizable vocabulary. In addition, computer-based, non-dedicated devices are often cheaper than their dedicated cousins.

Another class of devices excluded are those dedicated devices that can produce synthesized speech, but may only formulate the message by typing and not any other method (e.g. picture icons). This is a broad group of devices that have been covered in the past. In addition, those devices that are only accessible by one method are excluded.

With these changes, Medicaid essentially has adopted a very narrow vision of appropriate ACD as the 'fix' for the undefined 'severe speech impairment'. However, the group of people who may medically and functionally benefit from ACDs are broad and diverse, creating a situation where a clinician or vendor will say to a Medicaid recipient, "this device would most benefit you, but since it is not covered by Medicaid, you will have to make do with this other device that does not meet your particular needs as well."

One last potential implication. When Medicaid makes the rules so clear about what is not covered, vendors, clinicians and clients might not even try to get funding from Medicaid for the kind of ACD that the client needs. Or if they are savvy about the Medicaid rules, they might try to get funding for the device as an "exception to rule," where the clinician must show the uniqueness of the client's condition, why that condition makes it necessary for the client to have the particular ACD, and that coverage of the ACD will result in less costly care. However, unlike under normal Medicaid medical necessity decisions, clients denied coverage under the 'exception to rule' provision do not have the right to a fair hearing. The administrator's decision is final.

Related Links
The Washington Administrative Code (WACs) for DSHS (to see those rules for Medicaid, page down to "Medical Assistance," chapters 388-500 to 388-561): http://www.leg.wa.gov/pub/wac/wac%20388%20%20title/wac%20388%20%20%20title/wac%20388%20%20%20title.htm

Sections of the WACs related to DME, including ACDs (Chapter 399-543): http://search.leg.wa.gov/wslwac/WAC%20388%20%20TITLE/WAC%20388%20-543%20%20CHAPTER/WAC%20388%20-543%20%20Chapter.htm

Due to the Thanksgiving holiday, the next Legal Bulletin will be November 30th.