Understanding Medicaid Unwinding and its Impact on the Healthcare System | $name

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Understanding Medicaid Unwinding and its Impact on the Healthcare System

Thu, Nov 2, 2023  -  Comments (0)  -   Posted by The Center for Health Affairs

Medicaid Continuous Enrollment: What is it?

During the early days of the COVID-19 pandemic, the federal government provided extra funding to states through the Families First Coronavirus Response Act’s Medicaid Continuous Enrollment Provision (MCEP). In order to receive this funding, states were required to suspend Medicaid redeterminations, allowing enrollees to keep their Medicaid insurance without having to reenroll every year.


Between March 2020 and March 2023, more than 21 million people enrolled in Medicaid — a nearly 30% increase over pre-March 2020 levels. In March 2023, total enrollment in Medicaid and the Children’s Health Insurance program (CHIP) had reached more than 94 million.


The Families First legislation made the additional funding available to states throughout the duration of the COVID-19 public health emergency (PHE). In late 2022, Congress passed the Consolidated Appropriations Act, which decoupled continuous enrollment from the PHE and called for an end of continuous enrollment on March 31, 2023, enabling states to resume Medicaid redeterminations on April 1.


What is the impact of this change?

With the end of continuous enrollment, millions of people became at risk of losing coverage as what has become known as “Medicaid unwinding” occurs. Kaiser Family Foundation estimates that between 8 million and 24 million people will lose coverage as a result — numbers in line with estimates from the Department of Health and Human Services. At this time, an estimated 9.5 million people have so far been disenrolled, including more than 443,000 in Ohio.


The single largest health coverage transition event since the first enrollment period of the Affordable Care Act, the expiration of the MCEP is meant to remove beneficiaries who are no longer eligible due to income or other standards. Before the beginning of the pandemic in 2020, people were removed from Medicaid for various reasons, such as losing coverage if their income was too high or if they failed to provide the required information needed to verify their income and residency. With the enactment of the MCEP, income changes and missed paperwork would not cause Medicaid enrollees to lose coverage. If a person was enrolled in Medicaid in March 2020, they would remain until the end of the MCEP in March 2023.


Who Could Face the Greatest Impact of Medicaid Unwinding?

In addition to income changes and lack of information being responsible for losing coverage, there are barriers for many that will lead to a removal or gap in coverage, even if they are actually still eligible.

Facing an increased risk are immigrants, people with disabilities, older adults and people with limited English proficiency. In addition to a possible lack of understanding, these individuals may not have received the important renewal notice due to a recent move in which they have not updated their contact information with the Medicaid agency.


Children are especially vulnerable to losing coverage during this process. According to a report by Georgetown University’s Center for Children and Families, the number of children who have lost or experienced gaps in coverage since the unwinding began is approaching 2 million. It’s important to note that this figure does not even include data from Oregon, Michigan or New York — indicating the number is likely even higher.


Georgetown researchers also state that 57% of the children experiencing a loss of coverage will be eligible for CHIP, and an additional 9% would be eligible for marketplace coverage with tax credits, still leaving a gap for many. Yet, researchers say in places where CHIP is run separately from Medicaid — in 30 states — Medicaid enrollment has only increased by 104,000.


The Impact on Emergency Departments

As millions lose Medicaid coverage, they will likely turn to emergency departments (ED) for care of non-life threatening medical issues, which are typically addressed by primary care or specialty care providers. Not being able to afford this option, uninsured individuals will often turn to EDs for these minor issues or due to their illnesses and injuries being untreated and now aggravated to the point of requiring urgent attention. This means EDs are facing the risk of overcrowding and a negative impact on a hospital’s ability to provide timely and focused care.


From the nursing shortages to the challenges associated with high volumes of patients during the pandemic, emergency departments and their staff have experienced a turbulent few years. Unfortunately, as Medicaid unwinding occurs, EDs will potentially be forced to face another challenge with this potential influx of patients.


We won’t be able to fully understand the impact of this Medicaid redetermination until 2024’s national insurance surveys provide the most accurate data on how many people lost coverage or encountered gaps in their health insurance coverage. As many individuals in the United States struggle with health issues, the unwinding process is already impacting millions. Only time will tell what the full extent of that impact will be on the healthcare community.

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