Policy experts worried lower-income people would get bumped back and forth between Medicaid and exchange plans under the Affordable Care Act. A Modern Healthcare survey of exchanges and insurers suggests such disruption has been minimal so far.
When this so-called churning has occurred, health plans and providers have found ways to mitigate the impact on patients' continuity of care, health plan officials say. But much remains unclear about what happens to this population as it shifts between different types of coverage.
Churning is what happens when people move between private coverage and Medicaid or else become uninsured. People may churn between private coverage, Medicaid and no insurance due to job loss, reduction of work hours, employers deciding to offer coverage, or other life change circumstances.
A 2011 Health Affairs analysis estimated that more than 35% of all adults with incomes below 200% of the federal poverty level would experience a shift from Medicaid to an exchange plan within six months, or the reverse, and that 50% would experience a shift within a year. Matthew Buettgens of the Urban Institute has estimated that 7 million people could churn between Medicaid and exchange plans each year.
Experts say churn can be disruptive to people's continuity of benefits and healthcare, particularly if they have medical conditions for which they are receiving treatment. In addition, it can be harder for people to access healthcare providers, particularly specialists, if they switch to Medicaid, which often pays lower rates.
“For a patient under a physician's care for a condition like cancer or renal failure, changing providers in the midst of chemotherapy or dialysis can be incredibly disruptive,” said Chris Stenrud, executive director of government relations at Kaiser Permanente.
But 14 months since the ACA coverage expansions were implemented, churn is happening at a relatively low rate, according to data from state exchanges, researcher insight and anecdotal feedback from payers. “There was this huge fear about churn, but I haven't been hearing much about it,” said Katherine Hempstead, a health insurance policy director at the Robert Wood Johnson Foundation.
Since January 2014, more than 118,000 people—or about 8% of those who signed up for private plans on California's exchange—exited a private plan and enrolled in Medi-Cal, state officials say. In New York, about 27,000 people—about 7%—of the people who signed up for private exchange coverage had an income change that made them eligible for Medicaid, though state officials have not tracked whether they actually signed up for Medicaid.
In Massachusetts, 13%, or 4,000 people, went from an exchange plan to Medicaid. The figure was 6% in Washington state, 5.5% in Rhode Island, 7.6% in Connecticut and fewer than 2% in Hawaii. Other state-run exchanges either declined to release data on the number of people moving between private plans and Medicaid, or they said they did not have data on churning.
A CMS spokesman said no data on churning between private plans and Medicaid were available for the nearly three dozen states using the federal marketplace. But a committee of health plans selling products on the federal exchange that has been tracking the trend has noted a small but steady exodus from exchange plans. The committee, however, could not determine whether the people exiting the exchange plans were transitioned to Medicaid or employer coverage or became uninsured.
Don Petry, program manager for healthcare reform at Blue Cross and Blue Shield of Tennessee and a member of that committee, said health plans on the federal exchange are collectively losing 3% to 5% of enrollees each month due to nonpayment.
Insurers say they lack a basis for comparison for whether the churn rate so far under the ACA is high, low or typical. “There aren't statistics to base it on, this is all brand new,” Petry said. “In the commercial market people usually sign up and are in for a long period, so there is no apples-to-apples comparison.”
Taylor Burke, an associate professor in health policy at George Washington University, said, “We are still learning what churn looks like in the new ACA world.” Burke said the fact that there are 25% more insurers on the federal exchange for 2015 compared with 2014 shows insurers are not particularly worried about the churn rate. “They are not running away from the exchanges,” he said.
To mitigate the effect of churn and maintain continuity of coverage and care, some insurers including Kaiser Permanente and Molina Healthcare, are offering both Medicaid plans and exchange plans. That enables enrollees to transition more seamlessly between commercial and Medicaid coverage. “Our Medicaid members have access to the same physicians and services as all other Kaiser Permanente members, so the care that our members receive does not change,” Kaiser's Stenrud said.
Provider-owned plans, such as MetroPlus in New York City, say they make it easier for members to move between exchange coverage and Medicaid because enrollees can stay with their network. “Our providers generally accept all products so people have the continued ability to see a doctor,” said Seth Diamond, chief operating officer of MetroPlus Health Plan, which is owned by the New York City Health and Hospitals Corp.
There are some reports from state-run exchanges that they face technology problems when people experience an income change making them eligible for Medicaid and then end up simultaneously enrolled in an exchange plan and Medicaid, said Dan Mendelson, CEO of consulting firm Avalere Health. These mix-ups have led to people being uninsured until the problem got resolved. “These problems have caused some people to be dis-enrolled,” he said.
Barbara Morales Burke, vice president of health policy at Blue Cross and Blue Shield of North Carolina, said “we don't receive information about why people drop coverage, so we have no ability to gauge how many lose coverage due to income.”
Insurance leaders in New York hope that their state's move to implement a Basic Health Program under the ACA in 2016, which would cover most non-elderly adults with incomes between 139% and 200% of the federal poverty level in a single seamless program, will improve continuity of coverage and care for lower-income people.
Lindsay Nelson, coordinator of community development and outreach at the Kentucky Primary Care Association, said healthcare providers are finding ways to maintain continuity of care for their patients when they churn between exchange and Medicaid coverage. But that may not happen in the 21 states that have not expanded Medicaid to lower-income adults, leaving people with incomes below 100% of the poverty level in the so-called coverage gap.
“Typically if an applicant is switching from (an exchange plan) to Medicaid, they are able to remain with their current providers,” Nelson said. “We have found that most of the Medicaid providers also accept (exchange) plans in the area. If not every provider is in someone's network, we can find a plan that includes the applicant's priority provider.”
