Many states are struggling to re-enroll adults and children in Medicaid and the Children's Health Insurance Program, with hundreds of thousands of current beneficiaries at risk of losing coverage, advocates say.
The enrollees who are at greatest risk are pregnant women, children and blind and disabled individuals who were enrolled in Medicaid prior to the effective date of two Patient Protection and Affordable Care Act provisions—the 2014 expansion of coverage to all adults with incomes up to 138% of the federal poverty level, and the establishment of a new formula to define household income under the Modified Adjusted Gross Income (MAGI) standard.
The problem in re-enrolling such beneficiaries is that these pre-ACA enrollees do not necessarily understand their states' requests for additional information, which is needed to determine if they are still eligible for Medicaid under the new MAGI standard. Many beneficiaries have not responded to redetermination notices and have been dropped from Medicaid. Beneficiary advocates argue that the notices are too complex and often are not written in an enrollee's primary language. As a result, the ACA's goal of expanding coverage is being undermined, as thousands of pre-ACA enrollees are losing their coverage.
“While we are pleased that Medicaid has been expanded to ensure access to healthcare for many of California's uninsured, we are gravely concerned that beneficiaries' rights have been eroded in the process,” said Claudia Menjivar, an attorney with the Western Center on Law and Poverty, which has co-filed a lawsuit in California to stop the disenrollment of non-English-speaking residents who did not fill out renewal forms.
In California, patient advocates have filed a lawsuit against the California Department of Health Care Services alleging that beneficiaries are being wrongfully dropped from Medi-Cal, the state's Medicaid program.
They claim that the state did not adequately explain to pre-ACA beneficiaries what information they needed to provide because of the adoption of the new MAGI income determination standard. Not only was the information request form complicated, it was sent only in English and Spanish, placing those who primarily speak other languages at a disadvantage, advocates say. As a result, response to the re-enrollment forms has been low, and as many as 1 million people could lose their coverage. A hearing on the suit is scheduled for December 9.
But Anthony Cava, a spokesman for the California Department of Health Care Services, said that, while Medi-Cal renewal forms were only mailed in English and Spanish, the forms were accompanied by a flier that included instructions in 10 other languages about how to get assistance on telephone hotlines. Those languages included Arabic, Armenian, Chinese, Farsi, Hmong, Khmer, Korean, Russian, Tagalog and Vietnamese.
If the pre-MAGI enrollees do not respond and lose their coverage, they still will have an additional 90 days to respond after the discontinuance to regain coverage, Cava said.
In Oregon, 77,000 pre-ACA enrollees lost their coverage because they didn't respond to redetermination forms in time.
The Oregon Health Authority did not respond to a request for comment by deadline.
More than 9 million people have enrolled in Medicaid and CHIP since October 2013 and all must have their eligibility re-determined. But experts do not expect difficulty in keeping these beneficiaries enrolled since they've already been assessed under the MAGI standard. Nevertheless, the Medicaid and CHIP Payment and Access Commission reported that most new Medicaid beneficiaries didn't know the state reassesses Medicaid eligibility every year. As a result, managed-care plans and some advocates plan to conduct outreach to make sure beneficiaries are watching for re-enrollment notices from the state.
The MAGI standard was established as a universal method for determining eligibility for either Medicaid or federal premium tax credits to make private health plans more affordable through the federal and state insurance exchanges. Before that, states' methodologies for determining Medicaid and CHIP income eligibility varied widely.
As of Jan. 1, 2014, eligibility for CHIP and Medicaid beneficiaries under age 65 must be determined using MAGI. States are required to determine that all pre-ACA beneficiaries are Medicaid-eligible using new formula.
Putting new eligibility systems in place, notifying pre-ACA beneficiaries, and processing their redeterminations—while simultaneously enrolling new beneficiaries—was expected to be a heavy burden for states, according to the CMS. As a result, it offered a waiver allowing states an extension for renewing coverage for pre-ACA beneficiaries. Thirty-six states have taken the extension (PDF), with deadlines ranging from June 2014 to as late as December 2015.
States that were given extensions to recertify pre-ACA Medicaid beneficiaries fall into two groups. The first group of states is ready to process re-determination notices for pre-ACA enrollees, and is sending out renewal forms to beneficiaries, but getting low response rates. The reasons for those rates range from the complexity of the notices to problems locating beneficiaries.
The second group of states comprised those that have yet to begin efforts to renew pre-ACA beneficiaries because they are still trying to get their health information technology systems in shape, not only to determine eligibility for previous Medicaid beneficiaries but to screen new applicants as well.
This is part of the reason the CMS announced in October that it was permanently boosting funding that helps states build Medicaid eligibility and enrollment systems. “The department has determined that three years was not a sufficient amount of time to conduct a robust procurement process, planning, systems builds, testing, implementation and refinements that are needed to achieve full systems transformation,” a CMS spokeswoman said.
In 2011, the CMS raised the federal matching rate to 90% from 50% for state expenditures on building eligibility and enrollment systems, and to 75% from 50% for maintenance and operations of those systems. The increase in the matching rate was set to expire in December 2015. The CMS estimated at the time that the enhanced funding would cost the federal government $1.1 billion over the four-year period.
The inability of state Medicaid agencies to find current mailing addresses or phone numbers for beneficiaries could be responsible for low response rates, said Daniel Gorlin, a principal at the Boston Consulting Group. Because of their low incomes, Medicaid beneficiaries often have unstable living situations that keep them on the move, with no forwarding addresses or phone numbers.
Short staffing poses another challenge for state Medicaid agencies as they try to contact pre-ACA enrollees, while at the same time determining eligibility for new applicants, said Leighton Ku, director of the Center for Health Policy Research at George Washington University. That's partly because the states got a larger-than-usual number of new applicants last year because of the publicity surrounding the ACA's Medicaid expansion and exchange open enrollment. “Historically there was a low volume of new Medicaid applications coming in, and then expansion happened and the floodgates opened, but there was not a comparable increase in staff size,” Ku said.
Nevertheless, Colorado and Kentucky say they're handling Medicaid re-enrollment under the MAGI standard without major problems. Medicaid agency representatives in those states credit their success to up-to-date and integrated IT systems.
Low-income adults who are newly eligible for Medicaid under the ACA likely will be easier to enroll than pre-ACA enrollees in 2015, given that they were already deemed eligible for Medicaid using the MAGI method, said Jessica Stephens, a senior policy analyst with the Kaiser Family Foundation.
For all Medicaid enrollees, the states are expected to move toward a renewal process in which the state Medicaid agency examines various data sources, such as the state wage database, to see if there is sufficient information on individuals to automatically renew them in the coming year. If so, they will send a notice of ongoing eligibility, letting the enrollee know what information was used to re-determine their eligibility, said Tricia Brooks, a researcher at Georgetown University's Center for Children and Families.
Beneficiaries are required to report any changes that would impact their eligibility. States not yet ready for the new automatic renewal process will send a pre-populated form with the information they have on file, asking enrollees to update their information. That can be done online, over the phone or through paper applications, Brooks said.
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