A potential shutdown couldn’t come at a worst time for Medicaid

With a potential shutdown on the horizon, the Centers for Medicaid and Medicare Services already has its hands full trying to decipher who no longer qualifies for Medicaid coverage now that we’re on the other side of the COVID-19 pandemic. The process has already been hampered with a few issues, and a shutdown could make it worse. To find out how, Federal Drive with Tom Temin Executive Producer Eric White spoke with Kelly Whitener, who is an Associate Professor of the Practice at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.

Interview Transcript: 

Kelly Whitener From the beginning of the COVID 19 pandemic and during the three years or so following the onset, Medicaid renewals were on pause. So everyone and this was under the direction of Congress Families First Responsibility Act. So during those three years, that three year period, states were required to keep everybody who enrolled in Medicaid enrolled and they got extra federal funding in exchange for that. Starting March 31st of this year that continuous coverage requirement ended and states started this process that we call the Medicaid unwinding of renewing everyone enrolled. So their states are currently processing renewals for over 90 million people. And this is a huge administrative task. The only thing we’ve seen in recent history that’s even at all comparable was in 2014 when states switched their Medicaid eligibility income counting rules to modified adjusted gross income. That was also a major undertaking. But I think this is actually even bigger.

Eric White So in these reviews, are they making a judgment calls on, you know, who qualifies and whatnot and the qualifications of obviously changed since the pandemic. And, you know, people are back to well, things are back to somewhat normal.

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Kelly Whitener Exactly. So Medicaid eligibility is determined based on a couple of different factors. But income is a big one. State residency, age, disability status, there’s also lots of other pieces. But income is a big one. And now states are tasked with determining are the people currently enrolled still eligible? Do they still meet those income standards? Do they still meet the other standards? And there’s a certain amount of that process that can be done in an automated way because we have, you know, data systems that can check and see, you know, how have wages changed or how has your family income changed? But that doesn’t work out for everybody. You know, it can also, changes could be brought about by your household size changing, right? You maybe you have a baby now, you have a bigger household, you know. So that changes how the income counting rules work. So it’s really a tremendous undertaking that has to be done on an individual basis, going through and identifying whether the people currently enrolled are still eligible. And there’s a big part of that that has to rely on systems, but there’s also a part of that that has to rely on checking in with the person. And of course, we know that people moved a lot during the pandemic. So addresses may be out of date. We’ve also seen, you know, big delays in mail. So you might get information from the Medicaid agency asking you, you know, to confirm various data points. But by the time you receive that packet, you’ve already missed the deadline. So it can be really a tough process.

Eric White And this started March of earlier this year, 2023, before all the shutdown talks started. How was the agency going? Did they have goals that they set of how many they wanted to be through by the end of the year? And if so, were they, you know, on their way towards achieving that?

Kelly Whitener So it really is a state driven process. The agencies set out the rules and allowed states to choose when to start their process and within some parameters how quickly to move. Most states started April-ish and are planning to process all of their renewals over a 12 month period. But as far as how it’s been going, I would say not well. There have been millions of people that have been dis-enrolled and a majority of those just enrollments have been for procedural reasons. And what I mean by that is that the state agency wasn’t able to determine whether the person was eligible or ineligible based on those data sources and systems checks and didn’t get information back in a timely way. So they dis-enrolled the person without knowing if they’re actually eligible. And we know from previous experience with Medicaid enrollments and estimates from people like ASPE at HHS that a large share of people that are procedurally dis enrolled are actually still eligible. But just for some reason, you didn’t get through those paperwork hurdles on time. So millions of people have been dis enrolled. We believe that a large share of them are actually still eligible, but now they’ve just lost their health coverage.

Eric White When that happens, who is that on? And I know that there are probably, you know, different cases and a lot of variables, but is it because of a lack of communication between the state and CMS or is it, you know, some of the onus also on the applicant just not getting their paperwork in on time?

Kelly Whitener It’s a little bit of everything. Right. I think what I try to think about is, you know, what would it be like for me? And I know that, you know, life is hectic and things come in the mail that sometimes take me a little while to open. And then if it’s a complicated, you know, packet of questions, that’s going to take me a little while to fill it out and get it back. And I moved during the pandemic, so I know that I’m still getting mail forwarded from another address and that, you know, takes a while. So I think there is a certain amount of everybody trying their best to make the system work. And it doesn’t always work, you know. So it could be that the state agency is doing their best, the families are doing their best, but it’s still just isn’t coming together in a timely way to keep that coverage. And then I think there are also, you know, other problems happening. CMS discovered over the summer that some of the automated processes that we call ex-parte weren’t happening correctly at the state level. And so they sent out a letter to all states asking them to check their systems and make sure the system was running the eligibility on an individual basis. And they just announced the summary findings from that assessment last week and about half of states, the system is not doing it correctly. So we know that people have been losing coverage inappropriately and now those states are going to have to pause those procedural test enrollments and reinstate the people impacted. And the estimates are that it’s about 500,000 kids and families that have been incorrectly terminated. And that’s happening right now. We’re in the middle of it. So when you think about what that means in connection with a government shutdown, you really could see kind of a perfect storm that there’s a lot of technical assistance right now back and forth between CMS and the state Medicaid agencies. There’s a lot of work going into mitigation strategies to try to fix these systems issues. And all of that will have to pause for the duration of a shutdown. The longer the shutdown lasts, the harder it is to catch up, the more problems that pile on. So you could see that this problem of already over 500,000 people that lost coverage inappropriately could get bigger and bigger and bigger.

Eric White And politically speaking, much like troops pay, it’s used as a way to try and guilt one side or the other, to try and move them along, saying, you know, you’ve got kids out there that are not getting their health coverage. Is that actually the case? Will there be some uninsured children because of a shutdown? You know, no matter who’s to blame.

Kelly Whitener Yes. Especially because of this unwinding process that’s happening right now. We know there are children that have lost their coverage inappropriately and CMS and states are in the process of trying to fix that. And the state work will go on despite a shutdown, but they won’t have their federal partner there to help them sort through, you know, how best to reinstate that coverage. This is only one example of all of the different ways the government shutdown has a harmful impact on the lives of people and on our government functioning. And I know your listeners know that from all of the reporting you’ve done on it. But, you know, it just really it’s upsetting that this is what it’s come to again.

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