Seniors, People with Disabilities Will Lose Medicaid Coverage After PHE

July 15, 2022 - Most states expect seniors and people with disabilities to lose Medicaid coverage once the COVID-19 public health emergency (PHE) ends, citing income changes and the inability to contact beneficiaries as top reasons, according to an issue brief from the Kaiser Family Foundation (KFF).

Under the Families First Coronavirus Response Act, states must maintain Medicaid coverage for beneficiaries until the PHE ends, even if their eligibility changes. The PHE is expected to be extended until at least October 2022.

However, seniors and people with disabilities may lose coverage once the PHE ends. These beneficiaries are also known as non-MAGI enrollees, as they qualify for Medicaid through a pathway that does not use the modified adjusted gross income (MAGI) methodology to determine eligibility.

Researchers gathered data on all 50 states and the District of Columbia from KFF’s survey of Medicaid state eligibility officials between March and May 2022.

From February 2020 to December 2021, the median increase in non-MAGI Medicaid enrollment was six percent. In the 40 states that estimated enrollment increases, the figure ranged from one to 22 percent. Medicaid and CHIP enrollment has increased across all pathways by over 23 percent between February 2020 and March 2022, the brief noted.

Non-MAGI enrollment accounted for 21 percent of total Medicaid enrollment as of 2019, but 55 percent of Medicaid spending went toward services for these beneficiaries due to their common chronic health and long-term care needs.

Fourteen states reported coverage loss estimates for after the PHE ends. Losses ranged from three to 23 percent, with a median of ten percent of non-MAGI beneficiaries expected to lose coverage.

The remaining states could not estimate how many non-MAGI beneficiaries would be ineligible following the PHE, but 37 states identified the reasons why they expected beneficiaries to lose coverage.

A change in income was the most cited reason (14 states), followed by returned mail or inability to contact enrollees (12 states). Nine states reported that a change in assets would likely cause non-MAGI beneficiaries to lose coverage, while three states cited changes in functional eligibility.

Researchers predicted that the number of people who lose coverage after the PHE ends may be higher than the number who gained coverage during the PHE.

As states return to normal operations, survey respondents noted that staffing shortages (30 states) and enrollee confusion (18 states) are most likely to impact non-MAGI beneficiaries. Eleven states expect coverage disruptions to affect non-MAGI beneficiaries.

Once the PHE ends, states must begin the process of redetermination to clarify which beneficiaries are still eligible for Medicaid. Nearly half of the reporting states (22) said it takes between 31 and 60 days to complete a non-MAGI eligibility determination.

According to KFF researchers, non-MAGI eligibility determinations cannot be easily automated or verified through electronic data sources, which has caused a backlog of pending applications. The determination process can be lengthy due to certain state policies.

For example, 43 states require paper documentation to verify income if electronic data sources are unavailable, while 36 do the same for assets. Two states always require paper documentation to verify income, and five require it for assets.

Additionally, only three states accept self-attestation from applicants without additional income and asset verification. Five states accept self-attestation with post-eligibility verification for income and assets.

However, 50 states use electronic asset verification systems for non-MAGI pathways and 20 states use electronic data matching to check financial eligibility for beneficiaries between renewal periods. These processes can help expedite determination processes, the researchers said.

Almost all states (50) renew non-MAGI eligibility yearly, with 33 processing ex parte eligibility renewals as of January 1, 2022. States use electronic and other data sources to process ex parte renewals and do not require beneficiaries to provide any information.

Most states (23) only renew eligibility for less than 25 percent of non-MAGI beneficiaries on an ex parte basis. But many have adopted strategies to increase non-MAGI ex parte renewals, such as relying on SNAP data, automating data checks, and expanding the number and type of electronic data sources.

States plan to partner with various stakeholders, including health plans, providers, and community-based organizations, to help non-MAGI beneficiaries renew their Medicaid eligibility or seek other coverage options once the PHE ends.