Growth in Medicaid MCO Enrollment during the COVID-19 Pandemic

This data note looks at state Medicaid managed care enrollment data through December 2020 to assess the impact of the COVID-19 pandemic and economic crisis on Medicaid enrollment. Data collected for 28 states show the rate of Medicaid managed care enrollment growth increased to 15.2% from March 2020 through December 2020 (Figure 1). The rate accelerated from the 11.3% reported for 30 states from March 2020 through September 2020 and reversed trends from March 2019 to March 2020 when aggregate growth declined. These trends mirror national enrollment trends that show enrollment growth has been accelerating post-pandemic. Rising unemployment (and loss of employer sponsored insurance) as well as the “maintenance of eligibility” (MOE) requirements tied to a 6.2 percentage point increase in the federal match rate (FMAP) authorized by the Families First Coronavirus Response Act (FFCRA) – which prevents states from disenrolling Medicaid beneficiaries if they accept the additional federal funding — are likely contributing to enrollment increases/growth across states.

Figure 1: MCO Enrollment Growth Rates: March 2019 – December 2020

Why are recent state MCO enrollment data an important indicator? Preliminary national Medicaid and CHIP enrollment data collected by the Centers for Medicare and Medicaid Services (CMS) is lagged and currently available through September 2020. These data show an increase in Medicaid and CHIP enrollment of 6.1 million or 8.6% from February through September. Our KFF Medicaid Managed Care Tracker tracks Medicaid enrollment in comprehensive Medicaid managed care organizations (MCOs) for all states that make these data publicly available. These data are updated in our tracker annually with March enrollment data, but given changes related to the pandemic we updated the tracker with available enrollment for December 2020 to provide a more current look at enrollment trends.

These data are informative as more than two-thirds of beneficiaries nationally receive most or all of their care through risk-based MCOs and almost two-thirds of states that contract with MCOs enroll 75% or more of their Medicaid beneficiaries in MCOs. Children and nonelderly adults are groups more likely to be affected by changes in the economy and are also more likely to be enrolled in Medicaid MCOs. Increased enrollment in MCOs is directly tied to spending without immediate regard to utilization of care – which has generally decreased during the pandemic for non-urgent care – since states make upfront capitation payments to MCOs to provide access to a range of services. Thus, analyzing growth in Medicaid MCO enrollment specifically is valuable beyond signaling broader trends in Medicaid enrollment.

What were the trends prior to the pandemic? Data show that prior to the pandemic, there was an aggregate enrollment decline among reporting states. Specifically, among the 32 states reporting data for March 2019 and March 2020 (of the 40 states, including DC, that contract with MCOs), there was an aggregate decline of 1.2% (Table 1). The median change was essentially flat, showing a 0.4% increase, and there were a relatively equal number of states reporting enrollment gains and enrollment declines (17 and 15 respectively). In 2018, these states accounted for over 85% of the total share of enrollment in Medicaid MCOs nationally.

What are the more recent trends? The negative growth from March 2019 to March 2020 starts to reverse between March 2020 and May 2020, coinciding with the outbreak of the COVID-19 pandemic. Among states that reported in the respective months, when compared to March 2020, states saw an increase in aggregate enrollment of 4.1% in May 2020, 11.3% in September 2020, and 15.2% in December 2020 with similar median growth rates in each time period (Table 1).1 The nine-month cumulative growth rates from March 2020 to December 2020 across states range from 7.4% (Tennessee) to 31.9% (Nevada) (Figure 2).

Figure 2: Percent Growth in Medicaid MCO Enrollment: March 2020 – December 2020

Parent firms, firms that own Medicaid MCOs in two or more states, saw large increases in both enrollment and market share. As of July 2018 (the latest period with national data) six parent firms – UnitedHealth Group, Centene, Anthem, Molina, Aetna, and WellCare – accounted for over 47% of all Medicaid MCO enrollment. In November 2018, Aetna was acquired by CVS and in 2020, WellCare was acquired by Centene. Now five parent firms dominate the market with a similar overall share of market enrollment.  From March 2020 to December 2020, overall Medicaid MCO enrollment increased by around 7 million enrollees of which the five parent firms accounted for about 55%, a bit above their overall market share (Figure 3).

Figure 3: Five Fortune 500 firms made about 55% of the increase in MCO enrollment in 28 states from March 2020 – December 2020

What should we watch going forward? States project that the MOE requirements and the continued economic downturn will maintain upward pressure on Medicaid enrollment in FY 2021. Additionally, with the Biden administration’s executive order to reopen the enrollment in the Federal ACA Marketplace and the “no wrong door” application process, more individuals may receive Medicaid coverage in the coming months. As Medicaid enrollment increases and as additional states transition to Medicaid managed care programs,2 so will enrollment in MCOs. As MCO enrollment continues to rise putting pressure on overall state budgets, states may want to carefully review options to mitigate risks in MCO payment rates balancing payments to MCOs due to changes in utilization new costs related to COVID-19 testing and treatment and directed payments to providers.

Table 1: Change in MCO Enrollment, March 2019 – December 2020
Enrollment Percent Change
State March 2019 March 2020 May 2020 September 2020 December 2020 March 2019 –
March 2020
March 2020
– May 2020
March 2020 –September 2020 March 2020 –
December 2020
Overall 33 States Reporting 33 States Reporting 27 States Reporting 31 States Reporting 29 States Reporting -1.2% 4.1% 11.3% 15.2%
Arizona 1,514,431 1,517,228 1,589,668 1,692,948 1,745,801 0.2% 4.8% 11.6% 15.1%
California 10,452,386 10,166,392 10,382,947 10,855,836 11,131,643 -2.7% 2.1% 6.8% 9.5%
Colorado 110,965 121,435 129,397 138,312 144,705 9.4% 6.6% 13.9% 19.2%
Delaware 200,194 198,477 NR NR NR -0.9%
District of Columbia 194,896 183,764 187,680 200,064 221,879 -5.7% 2.1% 8.9% 20.7%
Florida 2,975,428 2,906,434 3,161,076 3,389,302 3,540,437 -2.3% 8.8% 16.6% 21.8%
Georgia 1,360,907 1,387,641 1,473,107 1,607,743 1,655,756 2.0% 6.2% 15.9% 19.3%
Hawaii 344,254 340,541 356,208 378,100 NR -1.1% 4.6% 11.0%
Illinois 2,144,696 2,197,501 2,241,742 2,547,885 2,597,213 2.5% 2.0% 15.9% 18.2%
Indiana 1,078,209 1,116,114 1,202,035 1,307,448 1,391,621 3.5% 7.7% 17.1% 24.7%
Iowa 562,432 578,226 604,881 635,790 655,824 2.8% 4.6% 10.0% 13.4%
Kansas 380,022 389,754 NR 419,109 431,633 2.6% 7.5% 10.7%
Kentucky 1,233,360 1,195,787 1,258,970 1,305,929 1,342,423 -3.0% 5.3% 9.2% 12.3%
Louisiana 1,533,075 NR NR 1,611,537 NR
Maryland 1,197,481 1,212,653 1,241,377 1,294,481 1,337,165 1.3% 2.4% 6.7% 10.3%
Massachusetts 695,290 717,029 NR NR NR 3.1%
Michigan 1,760,122 1,772,762 1,827,045 1,975,341 2,042,712 0.7% 3.1% 11.4% 15.2%
Minnesota 835,528 841,347 904,481 967,376 997,921 0.7% 7.5% 15.0% 18.6%
Mississippi 437,194 431,523 436,099 462,070 475,636 -1.3% 1.1% 7.1% 10.2%
Missouri 676,539 549,116 605,800 680,421 716,368 -18.8% 10.3% 23.9% 30.5%
Nebraska 233,431 232,991 240,935 257,589 285,354 -0.2% 3.4% 10.6% 22.5%
Nevada 466,227 434,252 496,207 543,650 572,951 -6.9% 14.3% 25.2% 31.9%
New Mexico 660,646 674,343 697,549 727,421 748,383 2.1% 3.4% 7.9% 11.0%
New York 4,344,939 4,210,483 4,388,700 4,776,592 4,974,291 -3.1% 4.2% 13.4% 18.1%
North Dakota NR 19,814 NR 22,593 NR 14.0%
Ohio 2,344,075 2,055,454 NR NR NR -12.3%
Oregon 853,185 898,749 944,127 994,631 1,031,249 5.3% 5.0% 10.7% 14.7%
Pennsylvania 2,274,092 2,235,532 2,324,425 2,461,326 2,541,504 -1.7% 4.0% 10.1% 13.7%
South Carolina 794,184 788,253 825,134 872,574 906,166 -0.7% 4.7% 10.7% 15.0%
Tennessee 1,389,600 1,421,145 1,431,885 1,493,081 1,526,031 2.3% 0.8% 5.1% 7.4%
Texas 3,688,147 3,614,486 NR 4,126,940 4,298,981 -2.0% 14.2% 18.9%
Virginia NR NR NR 1,513,132 1,575,269
Washington 1,332,557 1,529,207 1,566,468 1,646,095 1,701,608 14.8% 2.4% 7.6% 11.3%
West Virginia 390,546 402,303 419,623 437,061 447,625 3.0% 4.3% 8.6% 11.3%
Wisconsin 756,650 766,477 833,181 910,960 954,550 1.3% 8.7% 18.9% 24.5%
NOTES: “NR” – Not Reported. Methodology for reporting enrollment data varies across states: some states report point in time (PIT) counts while other states report monthly averages.

AR, NH, NJ, RI, and UT did not report any data for any time periods.

Aggregate growth rates were calculated using states that reported in both periods. From March 2019 – March 2020, 32 states reported in both periods. From March 2020 – May 2020, 27 states reported in both periods. From March 2020 – September 2020, 30 states reported in both periods. From March – December 2020, 28 states reported in both periods.

Data for GA, IL, TX, and WV in the December 2020 column represent data from November 2020 as those were the most up-to-date data available.

SOURCES: KFF analysis of state Medicaid managed care enrollment reports.

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