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Impact of Medicaid on Cochlear Implant Access

Sorkin, Donna L.

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doi: 10.1097/MAO.0000000000002142
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Since its creation in 1967 as part of President Lyndon Johnson's War on Poverty programs, Medicaid has grown to be the largest publicly funded healthcare program in the United States with 72 million enrollees in 2016 (1). Medicaid covers individuals of all ages whose income and resources are insufficient to pay for healthcare. Some states have opted to add children with disabilities as a covered beneficiary category, regardless of family income. Medicaid funding is provided largely by the federal government; states’ financial contributions vary according to an established formula with the average Federal contribution to a state being 63% of Medicaid cost in FY2016 (2). The US Department of Health and Human Services describes Medicare as an insurance program that operates in the same manner throughout the country while Medicaid is characterized as an assistance program with each state determining operational characteristics (3,4).

Nationally, Medicaid provided healthcare coverage for 45% of all children age 6 and under in 2016 compared with 55% of young children covered by private insurance in the same year. It should be noted that because individuals may report more than one source of health insurance coverage, totals may add to more than 100% when counting in other forms of insurance. Health insurance coverage for young children has increased in the past 20 years; in 2015, after implementation of the Affordable Care Act (ACA), only 4% of US children under age 6 were uninsured (5). Non-coverage for the non-elderly adult population also declined after implementation of the ACA by 8.4% (6).

States must cover conditions that impact on a child's growth and development under Medicaid because of Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) required for all children who are in families who have poverty-level income, receive supplemental security income, or receive foster care or adoption assistance (7). Because pediatric hearing loss is considered a risk factor that may negatively impact a child's normal development, cochlear implants (CI) for children are covered by all 50 states. CI coverage for adults under Medicaid is optional and determined by each state. An estimated 60% of states cover adults for CI (8).

States have flexibility in determining how they will operate their Medicaid program. Hence the operational characteristics of CI coverage (i.e., candidacy criteria, rules on equipment replacement, amount of therapy sessions covered) varies state to state. Reimbursement for services to the hospital and to other providers also varies but payment is often well below actual cost.

The objective of this study was to: 1) document the role of Medicaid in the provision of cochlear implants and 2) identify access barriers that exist under Medicaid coverage due to states’ adopted rules regarding CI candidacy, bilateral coverage, and reimbursement to the clinic. Since cochlear implantation involves services beyond the surgery, we also examined patient access to the continuum of needed CI care including audiology, therapy, and equipment replacement.


A SurveyMonkey questionnaire was sent electronically in May 2017 to selected US cochlear implant centers undertaking at least 10 CI surgeries per year. Before sending the survey, an initial contact was made with each clinic to determine an appropriate point of contact. This identified person was generally a CI audiologist who agreed to coordinate the clinic's survey response and ensure accuracy of the numbers and the operational characteristics of providing CI under Medicaid in the state. Typically the Medicaid patient numbers are retained in the clinic business office and these were obtained and checked by the point of contact. Clinics were assured that their specific statistics would not be shared—that only aggregated data would be pubished. The SurveyMonkey served as a mechanism of easily communicating survey responses to the study organizers. In some instances, the state operational specifics were available on the Medicaid website and these were reviewed as a check on the accuracy of the clinic response. Responses were received from a total of 47 CI centers in 35 states. See Figure 1 for the states represented. Not all surveyed clinics provide CI to both children and adults. Respondents were from all regions of the country and represented a diversity of clinic types (e.g., university, hospital-based, private practice, non-profit) and varying program size. Numbers of CI surgeries performed (total and Medicaid funded) were collected for adults and children for two calendar years—2015 and 2016. The number of surgeries and proportion of Medicaid were similar for individual clinics in the two survey years. Not every respondent answered all of the questions; seven of 47 clinics did not answer the questions on the number of Medicaid surgeries. All of the 47 survey participants did respond on some or all of the other operational issues. The survey also requested information regarding candidate access and clinic financial concerns posed by the Medicaid program in the state in which the clinic was located. (Questionnaire is attached in the Appendix.)

FIG. 1
FIG. 1:
States represented in survey responses (n = 35).

There are some limitations associated with the use of a survey to collect data for a study since the accuracy of the data is dependent upon the individual reporter. We think we have minimized inaccuracies by: 1) involving only known and respected clinicians, 2) reviewing consistency within states for which we have more than one clinic response, and 3) comparing reported clinic coverage data to published Medicaid regulations in some states. Given the consistency of the information across the 35 states in the study, we think the findings to be an accurate representation of how Medicaid is currently insuring cochlear implantation. A future study will directly review state regulations including those for Medicaid Managed Care Organizations (MCOs) as these groups seem to demonstrate coverage disparities from straight Medicaid. We will also explore how the published regulations may differ from the way programs are actually administered by state Medicaid personnel.


For the 36 clinics returning surveys on pediatric patients, Medicaid was the funding source for an average of 55% of pediatric surgeries as shown in Figure 2. “Pediatric” was defined as whatever age Medicaid uses in the clinic location; this age varies state to state ranging from 18 to 21 years (and under). National Medicaid pediatric coverage in 2016 was 45% of all US children (9). Some states cover children with disabilities regardless of family income which may account for the higher proportion of children who received CI under Medicaid than is the overall mean of US children covered by Medicaid.

FIG. 2
FIG. 2:
Pediatric Medicaid by CI clinic. n = 36/mean = 55%.

For the 23 clinics in the survey which indicated their state's Medicaid system covered adults for CI, Medicaid was the health insurer for an average (mean) of 22% of adult CI surgeries; median proportion of adults covered by Medicaid for their CI surgery was 13%. A few clinics in the sample had a high proportion of Medicaid adults and this skewed the mean, as shown in Figure 3.

FIG. 3
FIG. 3:
Adult Medicaid % by CI clinic, n = 23/mean = 22%.

Five access concerns associated with provision of CI services funded by Medicaid were identified by survey respondents: 1) equipment replacement and processor upgrade policies, 2) low reimbursement by state Medicaid for cochlear implant surgery and related services, 3) emphasis being given to Medicaid Managed Care (MCO) and the complexity this can add for a specialized service like CI that is offered at a limited number of facilities; 4) caps on the amount of therapy that can be provided to children post-CI surgery; and 5) obtaining authorization for CI surgery and related services.

The most frequently mentioned challenge, noted by 33 of 46 respondents, was state Medicaid programs’ low reimbursement of cochlear implantation. This access issue relates to the entire continuum of care—the surgery, device, programming, (re)habilitation, and equipment replacement. (In many states, CI manufacturers have contracted with Medicaid to be a direct durable medical equipment [DME] provider, which lessens the reimbursement burden for equipment and replacement of parts.) One center indicated that they sometimes receive nothing from Medicaid on invoice. One survey respondent wrote “We generally do not accept Medicaid because reimbursement is so poor.”

The second most mentioned issue, noted by 23 of 46 respondents, were rules relating to the replacement or upgrade of a patient's sound processor particularly if the external device is still working. Some states use a 5-year usable life window and will cover an upgrade after 5 years of use, which is typical of many private insurance plans. Some states will not upgrade a processor—even after 5 years—unless the patient demonstrates improved outcomes with the new equipment. Nine of the respondent indicated that unless the sound processor is obsolete and broken, their state Medicaid will not allow an upgrade. One state will provide upgrades only if the device is older than 10 years and is also lost, stolen, broken, or beyond repair. A few states require previous approval, even for a broken device, which can take time and leave the CI recipient without sound. Several respondents noted that their state Medicaid program imposes specific limits on the number of batteries that will be covered under Medicaid, a limitation which may not allow sufficient numbers of batteries for all recipients given device and programming characteristics. In some states, the clinic may submit paperwork requesting additional batteries over the allotted amount. In other states, this is not an option and may force families to ration the times when their children are able to hear.

Caps on the number of therapy sessions that may be provided to children post-cochlear implantation were mentioned by 14 of 46 respondents. This is a concern as insufficient therapy may impact on patient outcomes. There are recommended guidelines for the amount of therapy that should be provided to children post-CI that are intended to address the child's specific needs and age at the time of receiving a cochlear implant (10). Arbitrary limits on therapy for children are in conflict with appropriate medical care.

Medicaid managed care provides for the delivery of Medicaid health benefits and services through contracted arrangements between state Medicaid agencies and managed care organizations (MCOs). States are increasingly encouraging use of MCOs to constrain costs. The hospital must be a provider for the particular MCO from which a family is receiving medical care and finding a close-to-home provider that also has a cochlear implant program may not be an option. MCOs were noted as having more restrictions on CI aftercare (i.e., number of sessions allowed for programming and (re)habilitation, not covering adults for rehab even if services are needed, and equipment replacement policies that are even more restrictive than straight Medicaid). One respondent noted that MCOs in their state limited the number of allowed therapy sessions for children to 5 to 10 per year though the medical need is typically once per week for the first 1 or 2 years post-surgery. This aftercare is important for all children but is particularly so for a child from a low-income family. In some instances, the clinic was able to address such issues by working directly with the MCO though this was not always the case. Three of 46 respondents specifically mentioned MCOs as an impediment to appropriate care provision and indicated concern given that states are increasingly relying on the MCO model.

Gaining authorization for approval was mentioned by 10 of 46 respondents as a burdensome process for clinicians that interferes with care delivery and takes away time from clinical care. Pre-authorization for therapy funded by Medicaid is sometimes required every 90 days, which is time-consuming and can result in lapses in service if the Medicaid office is slow to process the request. Given that the authorized individual from Medicaid is typically not an ear, nose, and throat doctor nor another hearing health professional, the review requires that the clinic provide extensive background demonstrating that the person meets Food and Drug Administration indications. If the request is being made for off label or special consideration, that can take a good bit more work. Long delays for authorization from Medicaid were mentioned for candidate approval, processor replacement (even when non-working), and aftercare services like (re)habilitation can take 3 months or longer.

Other access challenges that were mentioned by survey respondents include:

  • No coverage of adults who were implanted as children under Medicaid and now have no access to CI aftercare services as they have aged-out of Medicaid's definition of pediatric and their state provides no CI coverage for adults
  • No coverage for teletherapy under Medicaid in their state, a service that is now offered by many clinics for families who live some distance from the clinic but require weekly therapy
  • In some states, simultaneous bilateral surgery is “allowed” but Medicaid will only reimburse for one implant in a bilateral surgery. This forces the patient to undergo two separate surgeries so that the second CI is covered, an option that is harder on the patient and more expensive overall for both the Medicaid program and the hospital


When the Medicaid program was first established, the underlying philosophy for the national law was that children's access to healthcare was a fundamental human right and a cornerstone of a just society. After passage of the original Medicaid Act of 1965 (11), Congress added a new component—EPSDT. This component reflected national leaders’ recognition of the special needs of low income children and their higher risk for having developmental disabilities or medical conditions that may impose a life-long disability or preclude an individual with a disability from development to the maximum extent possible during the critical early years of life (12,13). The component added in 1967 directed states to develop programs to periodically assess children for health conditions that may impede their development (14).

Later legislation passed in 1989 went further, expanding EPSDT provisions to ensure that all treatments allowed under the definition of “medical assistance” were covered in all states (15). The 1989 addition to the Act was a consequence of evidence that there was limited coverage for children with mental and developmental disabilities in some states (16). Congressional Members indicated that it was their intent that children with special needs would be appropriately served, regardless of where they lived. Additionally, EPSDT applies to children's health needs, regardless of whether or not a child is receiving services in Medicaid managed care or straight Medicaid.

The 1989 EPSDT amendments specifically mention Hearing Services including assessment, diagnosis, and treatment (17). Such measures are intended to correct or ameliorate physical and mental health conditions discovered by screening. The Amendments added coverage of specific medical services even when such services are not covered for adults. Two of the listed services in the language of the Act unequivocally support coverage of cochlear implants and related services:

“Prosthetic devices” and “Other diagnostic, screening, preventive and rehabilitative services including any medical or remedial service (provided in a facility, home or other setting) recommended by a physician or other licensed practitioner for the maximum reduction of physical or mental disability and restoration of an individual to the best possible functional level.”

The results of this national survey of cochlear implant clinics indicates that, in most states, Medicaid is a significant source of support (and sometimes the majority insurance type) for children receiving cochlear implants. Adult coverage of CI under Medicaid is optional; there was coverage for adults in two-thirds (23 of 35) of the states represented in the survey. Private insurance typically provides CI coverage for people of all ages.

Although coverage of CI is available for all eligible children (and for adults in many states), the manner in which Medicaid operates vis a vis CI services appears to not conform with the intent of the 1989 legislation in many states. The problem lies in the individual state regulations for state Medicaid programs and the effect these regulations have on access to services. For example, equipment replacement policies that are substantially different from those that are typical of Durable Medical Equipment (DME) provisions in other insurance vehicles, such as Medicare and private insurance plans, impede Medicaid beneficiaries from receiving appropriate and comparable care. Other examples of inadequate care include Medicaid limitations on the number of therapy and/or programming sessions, rules which may limit care to a level that is below what is considered appropriate pediatric care practice. Authorization processes that are bureaucratic and time-consuming can disrupt care to needed services for children while the clinic waits for approval.

Very low reimbursement levels threaten clinic viability. Two respondents did not wish to put comments on this topic in writing but verbally shared that their hospital informally encouraged their program to slow their numbers by placing patients in queues. In the extreme, hospitals have closed pediatric CI programs due to the inadequacy of Medicaid reimbursement.

In summary, the intent of the EPSDT legislative language was to ensure that children received appropriate services wherever they lived in the country. What has transpired over the years is a Medicaid system that varies depending upon location and also a system in many states that rations care to those children who need the greatest support to overcome a major life disability.


1. Statistica. Total Medicaid enrollment from 1966-2017; 2018. Available at: Accessed June 1, 2018.
2. Kaiser Family Foundation. Federal and State Share of Medicaid Funding; 2018. Available at:,%22sort%22:%22asc%22%7D. Accessed May 1, 2018.
3. HHS. What is the difference between Medicare and Medicaid? 2015. Available at: Accessed May 30, 2018.
4. The Difference Between Medicare and Medicaid Reimbursement; 2018. Available at: Accessed May 1, 2018.
5. Georgetown University Health Policy Institute. Medicaid's Role for Young Children; 2016.
6. Kaiser Family Foundation. Key Facts about the Uninsured Population; 2017. Available at: Accessed June 1, 2018.
7. Early and Periodic Screening, Diagnostic, and Treatment; 2017. Available at: Accessed June 1, 2018.
8. Estimate based upon direct review of state Medicaid rules and survey responses; 2017.
9. Ibid., Georgetown 2016.
10. Eskridge HR, McConkey Robbins A, Wilson K, Zombek L. Position Paper: Pediatric Habilitation Following Cochlear Implantation. Adopted by the Board of Directors, American Cochlear Implant Alliance; 2015. Available at: Accessed September 21, 2018.
11. Social Security Amendments of 1965, Pub.L. 89–97, 79 Stat. 286, enacted July 30, 1965.
12. Rosenbaum S, Wise PH. Crossing the medicaid-private insurance divide: the case of EPSDT. Health Aff (Millwood) 2007; 26:382–393.
13. The Commonwealth Fund. EPSDT: An overview; 2005. Available at: Accessed May 30, 2018.
14. Social Security Amendments of 1967, PL 90-248, Sec 302.(a).
15. Omnibus Budget Reconciliation Act of 1989. Public Law; 101–239.
16. Kaiser Commission on Medicaid and the Uninsured. Medicaid: An overview of spending on “mandatory” vs “optional populations and services; 2005.
17. Ibid., Omnibus Budget Reconciliation Act of 1989.

Access to care; Cochlear implants; Early and periodic screening, diagnostic, and treatment; Health insurance; Medicaid; Reimbursement

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