Medicaid Renewal Experience Will Vary Across States. What Will We Learn?
By Suzanne Wikle
This month marks the first time in more than three years that states can disenroll people from Medicaid. Pandemic-era rules maintaining continuous coverage for people insured by Medicaid are ending. The return to “normal operations” for state Medicaid agencies means that several million people are likely to lose their Medicaid health insurance over the coming year. This change will fall hardest on children and communities of color. The U.S. Department of Health and Human Services (HHS) estimates that 45 percent of people who lose Medicaid coverage will still be eligible.
The magnitude of coverage loss will depend on state actions, advocacy and outreach efforts, and the Centers for Medicare and Medicaid Services (CMS) holding states accountable. While coverage losses will occur, the aim should be to ensure those who remain eligible stay enrolled in Medicaid. This will take nimble actions by states, strong advocacy efforts, and critical oversight from CMS over the coming year.
Pandemic-era protections have ended
Medicaid enrollment is at a record high. That’s largely due to protections enabled early in the COVID-19 crisis to ensure people didn’t lose their health insurance during a global pandemic.
The first congressional response to COVID-19—the Families First Coronavirus Response Act—provided states with additional federal Medicaid dollars. In return, states could not terminate people from Medicaid for the duration of the Public Health Emergency (PHE). This policy is referred to as the continuous coverage provision. Every state accepted federal dollars in exchange for keeping people continuously enrolled in Medicaid.
In late 2022, Congress passed the Consolidated Appropriations Act. It separated the continuous coverage provision from the PHE and set its end date for March 31, 2023. People have not had to complete their annual renewal process over the past three years to retain their coverage, but now they will have to. This will likely lead to significant coverage losses.
Medicaid matters to every community
Medicaid is one of the largest health insurance programs in the country. It covers 85 million+ people—more than 1 out of 5 residents. Medicaid provides coverage to nearly 40 percent of all children and almost 60 percent of everyone living in poverty. More than 40 percent of all births in America are paid for by Medicaid. And Medicaid is the largest payer for mental health services in the United States.
The Medicaid program is a fundamental component of our health care system. Like other support programs, however, Medicaid is designed to make people prove their worthiness, in part by navigating administrative burdens throughout the application and renewal processes. This approach is rooted in racism and distrust of people struggling to make ends meet. These obstacles were essentially eliminated over the past three years when the continuous coverage policy was in place. But as the pandemic-era protections end, HHS estimates that around 15 million people will lose Medicaid between April 2023 and summer 2024. The magnitude of coverage loss will be perhaps the largest ever.
Many dropped from Medicaid will remain eligible, despite losing coverage
6.8 million people expected to lose coverage are likely still eligible for Medicaid. Their loss of coverage is largely preventable, but still happens because of onerous renewal paperwork, long wait times at call centers, or other administrative barriers. Children are particularly vulnerable over the next year of losing their health insurance coverage even though they are still eligible. In fact, more than 70 percent of children who lose coverage after the continuous coverage provision ends are likely still eligible for Medicaid. Children, as well as people who are Latino, Black, AAPI, and multi-race, are more likely than white people to lose coverage despite still being eligible.
The remaining coverage loss breaks down as:
- 383,000 who will fall into the coverage gap in their non-expansion states,
- 2.7 million who will qualify for Marketplace insurance, and
- 5 million who will likely transition to employer coverage.
State approaches will provide valuable information
All states will have an enormous administrative lift to “unwind” from the continuous coverage provision. But states will likely vary greatly in how well they keep eligible people enrolled. States have been given numerous tools and options to lessen the chance that someone who is still eligible loses their Medicaid coverage. But, as is too often the case, the ease with which someone can stay covered will come down to where they live.
The Center for Children and Families at Georgetown and the Kaiser Family Foundation recently released an annual survey that highlights choices states are making with the unwinding process.
Some states are going to great lengths to reach Medicaid enrollees and ensure that people know what action they need to take. Other states lack basic (and federally required) infrastructure to help people renew their coverage, such as online or telephonic applications and renewals.
If the attention to Medicaid over the next year focuses mostly on enrollment losses, we will miss an opportunity. The coming year will tell us a lot about how to help people stay connected to a benefit for which they’re eligible. For example, will states using text message reminders be more successful at renewing people’s coverage? Will the ability to better coordinate with Managed Care Organizations help reduce churn? Will people in states using the most options and waivers during this period experience less coverage loss?
Fortunately, we will have state data to help us answer these questions. It will show how each state is performing on key metrics, such as how many people are disenrolled for procedural reasons (paperwork reasons or not determined ineligible), how long people must wait on hold when they call their Medicaid agency, and how many people the state successfully renews (including ex parte renewals). This data will allow us to compare states’ Medicaid operations in a way we haven’t been able to before.
We should assess Medicaid—and states—over the coming year on how well they ensure the program reaches people who are eligible. Let’s celebrate the states with minimal coverage losses and learn from their success. Let’s seriously evaluate states where people are more likely to lose coverage despite still being eligible and learn from their mistakes. Most importantly, states and CMS should use lessons learned from the past three years about the value of continuous coverage and take steps to ensure that a “return to normal” with Medicaid unwinding leads us to a new normal of reduced burdens, increased efficiency, and lower churn.