Millions at risk of losing Medicaid in spring for less than $1.7 trillion in federal spending

Millions of people who signed up for Medicaid’s public health insurance program during the Covid pandemic could lose their coverage in the spring if their state determines they no longer meet the program’s eligibility requirements.

Medicaid enrollment rose 30% to more than 83 million people during the pandemic, after Congress essentially barred states from kicking people out of the program for the duration of the federal public health emergency declared in response to Covid .

Tucked away inside a more than 4,000-page, $1.7 trillion bill that funds the federal government through September is a provision that would strip Medicaid’s public health emergency coverage protections. Instead, states could begin terminating coverage for recipients in April 2023 if they no longer meet the program’s eligibility criteria.

“Beginning April 1, Medicaid agencies conducting redeterminations for people enrolled in the program may result in the termination of Medicaid coverage,” said Jack Rollins, director of federal policy at the National Association of Medicaid Directors. “Whereas right now since the public health emergency of Covid-19 began, states were not allowed to rescind Medicaid coverage.”

Congress must pass the legislation by Friday to avoid a government shutdown.

The public health emergency, first declared in January 2020 by the Trump administration, has been renewed every 90 days since the pandemic began. The powers activated by the emergency declaration have had a major impact on the American health care system, allowing hospitals to act more quickly when infections rise and Medicaid to keep millions of people enrolled in its public health insurance.

The Department of Health and Human Services has estimated that about 15 million people will lose coverage through Medicaid once enrollment protections no longer exist and states review people’s eligibility based on the criteria used before of the pandemic Medicaid is the federal insurance program for the poor and those who lose their health insurance because they cannot work because of a disability.

“It’s important to contextualize that the loss of Medicaid coverage does not necessarily mean the loss of health insurance coverage,” Rollins said. “Many of these people will transition to other sources of coverage.”

People generally lose Medicaid coverage if their income rises and falls outside the program’s parameters. Rollins said most people who drop out for that reason starting in April will likely switch to coverage in the Affordable Care Act marketplaces. HHS estimates that about one-third of those who will lose Medicaid coverage will be able to get tax credits for marketplace insurance.

But some people opt out even though they remain eligible for Medicaid because they don’t receive the renewal notice, can’t provide the paperwork required by the state, or don’t send the paperwork in by the deadline, among other reasons. HHS has estimated that 6.8 million people will lose Medicaid coverage even though they remain eligible for the program.

“There needs to be a process to renew coverage or redetermine coverage and drop people who are no longer eligible,” said Jennifer Tolbert, a Medicaid expert at the Kaiser Family Foundation.

“The key is to do it in a way that minimizes as much as possible coverage losses among people who remain eligible,” Tolbert said.

The legislation requires states to make a good faith effort to contact the person whose eligibility is being reviewed by more than one method of communication. States cannot terminate someone’s Medicaid coverage based solely on mail returned in response to outreach efforts.

“We’re trying to ensure that states have the most up-to-date contact information for their enrollees,” Rollins said. “Because we know that without accurate contact information, that increases the likelihood of loss of inadequate or unnecessary coverage and that’s something we’re working to prevent.”

Republican governors on Monday called on the Biden administration to end the Covid public health emergency in April so their states can begin disenrolling people who no longer meet Medicaid eligibility requirements , arguing that the costs of higher program enrollment are too high.

Still, Tolbert said KFF found states spent about $47 billion to cover additional Medicaid enrollees through September 2022, while receiving $100 billion in federal funds.

“The costs were more than covered by the enhanced federal funding,” Tolbert said.

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