On Sept. 15, the Washington, D.C.-based Urban Institute released a new report entitled “What Will Happen to Unprecedented High Medicaid Enrollment After the Public Health Emergency?” by Matthew Buettgens and Andrew Green.
Buettgens and Green write that “Medicaid enrollment has risen substantially since the start of the COVID-19 pandemic. Recent data show enrollment jumped by more than 9 million people from February 2020 to January 2021. The higher enrollment is driven by two main causes: the unprecedented pandemic-related job losses concentrated in March to June of 2020 and the continuous coverage requirement of the Families First Coronavirus Response Act, which prohibits state Medicaid agencies from disenrolling beneficiaries during the public health emergency (PHE). Even as the economy improves, however, the continuous coverage provision is likely to contribute to even higher Medicaid enrollment through 2021.”
Analysis projects that 15 million people could lose Medicaid coverage when the emergency declaration ends. Researchers at the Urban Institute report that states have the ability to slow the pace of disenrollment and can provide assistance finding alternative coverage options for these individuals. Researchers analyzed state enrollment patterns to determine its main drivers and to project enrollment growth for 2021.
Key findings of the report include:
- By the end of 2021, it is estimated that 17 million more nonelderly people will be enrolled in Medicaid than before the pandemic, reaching a total of 76.3 million Medicaid enrollees younger than 65 years of age. It is estimated the PHE will expire at the end of 2021.
- Continuous coverage provision significantly contributes to ongoing Medicaid enrollment growth. In a typical month pre-pandemic, many people would lose Medicaid eligibility and others would gain eligibility. Over 21 months, eliminating disenrollment caused by loss of eligibility caused a substantial cumulative enrollment increase.
- Centers for Medicare & Medicaid Services (CMS) now gives states 12 months to restore normal income eligibility redeterminations for Medicaid enrollees once the PHE expires, instead of just six months. Gradual processing of enrollment over 12 months could reduce unnecessary losses of coverage, however, the expected loss of enhanced federal medical assistance percentage (FMAP) in March 2022 gives states a financial incentive to process enrollment more quickly.
- The estimated number of Medicaid enrollees could decline by approximately 15 million people during 2022—including 8.7 million adults and 5.9 million children. One third of adults losing coverage after the PHE could qualify for health coverage in the Marketplaces and nearly all of the remainder would have access to an offer of employer coverage in their family deemed affordable under the Affordable Care Act (ACA).
- Many losing Medicaid coverage would be eligible for other sources of subsidized coverage. It is estimated that one third of the adults who would lose coverage would be eligible for Marketplace premium tax credits (PTCs) if the enhanced tax credits in the American Rescue Plan Act (ARPA) are made permanent. Fifty-seven percent of children losing coverage would be eligible for the Children’s Health Insurance Program (CHIP), and nine percent would be eligible for Marketplace coverage with tax credits.
The researchers conclude that “CMS could also improve this transition by encouraging states to continue measures taken during the pandemic to streamline eligibility processing and enhance continuity of coverage. Congress also has a role. Extending the enhanced FMAP through the transition period to normal eligibility would remove a major incentive for states to cut enrollment quickly and would facilitate a smoother transition both for beneficiaries and state governments. Also, making enhanced Marketplace PTCs in the ARPA permanent would make many of those losing Medicaid coverage after the PHE eligible for assistance. Decisions made during the remainder of this year can improve continuity of care for Medicaid enrollees and the stability of state finances during 2022.”
