How Many People Might Lose Medicaid When States Unwind Continuous Enrollment?

Authors: Alice Burns, Elizabeth Williams, Bradley Corallo, and Robin Rudowitz
Published: Apr 26, 2023

Starting April 1, 2023 some states resumed disenrolling people from Medicaid after a three-year period during which states provided continuous enrollment in exchange for enhanced federal funding. Between February 2020 and March 2023, Medicaid enrollment grew by an estimated 20 million people, contributing to declines in the uninsured rate, which dropped to the lowest level on record in early 2022. As states unwind the continuous enrollment provision, we estimate, based on a recent KFF survey, that 17 million people could lose Medicaid coverage – including some who are no longer eligible and others who are still eligible but face administrative barriers to renewal. Decreases in Medicaid enrollment could reverse the recent gains in insurance coverage overall.

This analysis estimates the number of people who could lose Medicaid during the unwinding period under three possible rates of Medicaid coverage loss, and shows for each illustrative rate, state-by-state coverage reductions among Medicaid children and adults. In practice, rates of Medicaid coverage loss will vary across the states, depending on states’ approaches to the unwinding and the extent to which they engage in outreach and assistance activities to minimize disenrollment among people who are still eligible.

The analysis uses a combination of enrollment data from the Centers for Medicare and Medicaid Services (CMS) Performance Indicator Project (PI data), Medicaid claims data (T-MSIS data), and some state-specific sources (see Methods for a detailed explanation of the analysis). We exclude people enrolled in the Children’s Health Insurance program (CHIP) because it is expected that some of the people who disenroll from Medicaid will enroll in CHIP and CHIP enrollment may increase during the unwinding. (In some states, CHIP enrollment decreased during the continuous enrollment period, potentially because some people who were eligible for CHIP remained instead on Medicaid.)

Our estimates are based on the best available public data on states’ Medicaid enrollment, but predicting the future here with incomplete data is highly uncertain and the scenarios described in this data note are intended to be illustrative only. The scenarios presented here represent a range of outcomes that states predicted in the recent KFF survey, but the range reflects predictions reported across all states that responded to the question. The analysis excludes estimates of people who may newly enroll in Medicaid during the unwinding period and among those who disenroll, how many will re-enroll within a short time (e.g., “churn”). Our analysis projects the rate of disenrollment, but net changes in Medicaid enrollment—which reflect new enrollment and churn—will be smaller than the number of people who lose coverage.

How Many People Might Lose Medicaid?

If Medicaid enrollment decreased by 18% in all states between March 2023 and May 2024, as suggested by a recent KFF survey, 17 million would lose Medicaid coverage (Figure 1). In KFF’s recent survey of states about their Medicaid eligibility policies, just over one-third of states were able to report their projected coverage losses associated with the unwinding. The midpoint of state responses was that 18% of Medicaid enrollees could be disenrolled over the course of the unwinding, responses were quite varied, ranging from 7% to 33%. We use 18% for this analysis to illustrate how much enrollment could decrease. But, recognizing the uncertainty and the expected variation across states, we present disenrollment numbers if the rate is 10 percentage points above or below the median, a range of 8% to 28% which is similar to the range coming from state responses.

An 18% decline in enrollment would translate to 17 million people losing Medicaid, of whom 5 million are children and 12 million are adults. These projected coverage losses are consistent with estimates from the Department of Health and Human Services (HHS) suggesting that as many as 15 million people will be disenrolled, including 5 million children and 10 million adults. HHS estimates that among the 15 million people who lose coverage, nearly 7 million will still be eligible. (KFF’s analysis models disenrollment but does not attempt to estimate the number of people who are still eligible.)

Between 8 and 24 Million Enrollees Could Lose Medicaid When the Continuous Enrollment Provision Unwinds

Although the midpoint of states’ estimated disenrollment rate was 18%, rates will range considerably across the states. If rates range from 8% to 28%, 8 million to 24 million people could lose Medicaid, including 2 million to 7 million children and 5 million to 17 million adults (see Appendix Table 1 for state-specific estimates). While neither the lowest nor highest rate of disenrollment is an expected national outcome, the range may be helpful in examining what the variation could be across states.

Expected disenrollments during the unwinding could reverse more than half of the Medicaid enrollment gains experienced during the continuous enrollment period (Figure 2). Comparing the number of people who could lose Medicaid with estimated enrollment growth during the continuous enrollment period, shows that the number of people losing Medicaid coverage would be nearly three-quarters of the enrollment increase under the midpoint scenario. Under this midpoint scenario, just over one-quarter of the enrollment increase during the pandemic would persist, meaning Medicaid coverage would be higher than pre-pandemic levels. The higher-range estimate of Medicaid coverage loss—which is not expected to occur in most states—suggests that in some states, Medicaid disenrollments during the 14-month unwinding period could exceed the enrollment gains from the 3-year continuous enrollment period. In some states, the number of people losing Medicaid could exceed the coverage gains because all current Medicaid enrollees will have to go through a renewal process.

At Least Half of Medicaid Enrollment Gains from the Continuous Enrollment Period Are Likely to Be Reversed

What Might Happen to the Uninsured Rate During the Unwinding?

As states resume renewals for all Medicaid enrollees, there is substantial uncertainty regarding how many people will lose Medicaid and of those, how many will transition to other coverage or become uninsured. A large share of people are covered by Medicaid, and one analysis shows that over half of children are covered by Medicaid and CHIP. Significant declines in Medicaid enrollment are likely to increase the number of uninsured, and other estimates suggest that there will be increases in the uninsured rate, in addition to increased enrollment in private health insurance and CHIP. The extent to which the uninsured rate may rise is difficult to predict based on current data sources. For example, because enrollment in Medicaid has been automatically sustained during the pandemic, it is possible that some people who are identified as enrollees with administrative data may have since transitioned to a job with employer-provided health coverage. And, federal surveys that are used to measure the uninsured rate – which rely on respondents self-reporting their health insurance status – show smaller increases in Medicaid enrollment than are observed in administrative data.

Even if people who disenroll from Medicaid are eligible for CHIP or for subsidies to purchase nearly-free private insurance through the ACA, they may not know they are eligible or transition to other coverage without a gap in coverage. Our recent analysis of coverage outcomes after disenrolling from Medicaid or CHIP found that nearly two-thirds of people experienced a period of uninsurance. Actual outcomes will vary across states depending on an array of state policy decisions. State efforts to provide outreach and enrollment assistance can help ensure that those who remain eligible for Medicaid—an unknown share of current enrollees—are able to retain coverage, and that those who are no longer eligible transition to other coverage.

Appendix Table

Number of People Losing Medicaid Between March 2023 and May 2024 Under Three Scenarios

Methods

Data: This analysis uses data from the Centers for Medicare and Medicaid Services (CMS) Performance Indicator Project Data (PI data) and the T-MSIS Research Identifiable Demographic-Eligibility (T-MSIS data). We used PI data from February 2020 through August 2022 and TMSIS data from 2019, Release 1.

Overview of Approach: We started our analysis with the enrollment projections through March 2023 as described in a prior analysis (although that analysis included CHIP and this analysis does not). To estimate the number of people who could lose coverage between March 2023 and May 2024, we:

  • Set up a placeholder where we input the assumed rate of coverage loss that would occur by the end of the unwinding period (May 2024), and
  • Calculated decreased enrollment rates among Medicaid children and adults for a given overall rate of disenrollment using information about enrollment growth during the continuous enrollment period.

Definitions and Limitations: Our estimates are intended to provide a range of disenrollment outcomes for each state’s child and adult Medicaid populations, but actual outcomes are unknown. It is expected that states will experience a wide range of outcomes and national numbers will reflect those varied experiences. Our estimates are also likely to differ from estimates of enrollment maintained by individual states. There are two primary reasons for these differences: the exclusion of some enrollees and the use of age-based eligibility for children. Specifically:

  • The PI enrollment data exclude people who are not eligible for full Medicaid coverage, such as enrollees who are only eligible for coverage of Medicare premiums, family planning services, or emergency care. Such enrollees are excluded from the enrollment totals in this analysis, resulting in lower estimates of total enrollment than in data maintained by individual states.
  • We define children as Medicaid enrollees who are grouped with children in the PI data, which are based on age rather than eligibility group.

We provide more detail about each step in the details below.

1. Placeholder for Overall Coverage Loss Rate. The rate of coverage loss is unknown. Our model is set up to show how many people could lose Medicaid by state under a range of possible outcomes. To estimate monthly disenrollments from the overall enrollment decrease, we assume that rates of coverage loss will be mostly the same across the 14-month unwinding period, but smaller in the first two and last months (April – May 2023 and April – May 2024).

2. Calculating Coverage Loss Among Children and Adults.  For a given rate of coverage loss, we calculate disenrollment among children and adults using the ratio of coverage gains for each group to the overall coverage gain. Specifically, during the continuous enrollment period, enrollment in Medicaid and CHIP grew by 27%, but enrollment Medicaid children grew by 20% and enrollment among Medicaid adults grew by 38%. We assume that during the unwinding, coverage loss will be proportionally smaller among Medicaid children and proportionally larger among Medicaid adults relative to the overall rate of coverage loss.

Our model is set up to estimate coverage losses for the adult eligibility groups, using the simulation model described in our prior analysis. There is considerably uncertainty associated with estimates for the adult eligibility groups, so we do not present those numbers in this data note. In finalizing the estimates, we focused analytic efforts on separating adult enrollees who were eligible for Medicaid through the Affordable Care Act expansion from adults eligible through another pathway. That distinction is important to understanding how the losses of Medicaid coverage might affect the amount of money states receive from the enhanced federal matching funds, which are available—but being phased down—through 2023.

News Release

During the COVID-19 Pandemic, People of Color Were More Likely to Die at Younger Ages

Published: Apr 24, 2023

The Nation Overall Also Experienced Higher Rates of Premature Deaths than Peer Countries

During the COVID-19 pandemic, people of color on average died at younger ages than White adults, resulting in substantial racial disparities in premature death and years of life lost, a new analysis finds.

The analysis examines the Centers for Disease Control and Prevention’s excess deaths statistics during the pandemic, which captures not only deaths caused by COVID-19 but also higher-than-expected deaths from other causes such as drug overdoses, suicide, health disease and liver disease. 

During the pandemic, all racial and ethnic groups experienced an increase in their premature mortality rate (defined as per capita deaths among people under age 75), though this rate rose more sharply among people of color than among White people. 

Expressed another way, White people who died prematurely (under age 75) during the pandemic on average lost 12.5 years of life, significantly less than the average years lost among American Indian and Alaska Native (22), Hispanic (19.9), Native Hawaiian and Other Pacific Islander (18.8), Black (18.3), and Asian (14) people.  

Collectively, the analysis estimates that people in the United States lost 14.8 million years of life due to excess deaths from March 2020 when the pandemic began through December 2022, with a disproportionately large share of those lost years affecting people of color.A separate analysis compares the rates of premature deaths in the United States with other large and wealthy peer countries through 2021 (the most recent year for which international data are available). The U.S. had the highest rate of premature death among the group of 12 nations during the two-year period. The U.S. on average had more than two times the average years of life lost per 100,000 people as the United Kingdom, the country with the next highest rate. The two analyses, “Racial Disparities in Premature Deaths During the COVID-19 Pandemic” and “Premature Mortality During COVID-19 in the U.S. and Peer Countries,” are both available through the Peterson-KFF Health System Tracker, an information hub dedicated to monitoring and assessing the performance of the U.S. health system. 

Premature Mortality During COVID-19 in the U.S. and Peer Countries

Authors: Matt McGough, Edouard Long, Krutika Amin, and Cynthia Cox
Published: Apr 24, 2023

This analysis examines changes in excess mortality and prematurity of those deaths in the U.S. and peer countries for 2020 and 2021. Using Centers for Disease Control and Prevention (CDC) weekly excess deaths data and the World Health Organization (WHO) all-cause excess death data, we compare excess mortality in the U.S. and other large and wealthy countries through 2021 and estimates the years of life lost, a measure of the prematurity of those excess deaths, during the COVID-19 pandemic. Excess deaths are the number of deaths beyond what would have been expected in a typical year and can be due directly or indirectly to COVID-19, as well as other causes.

When compared to other countries and adjusted for population size, the U.S. had the highest excess mortality rate among similarly large and wealthy countries for the period 2020-2021—the most recent data available for all these countries. In addition the U.S. also saw a higher rate of death among younger people, and thus a larger increase in premature deaths per capita than peer countries.

The analysis is available through the Peterson-KFF Health System Tracker, an online information hub that monitors and assesses the performance of the U.S. health system.

Racial Disparities in Premature Deaths During the COVID-19 Pandemic

Published: Apr 24, 2023

This analysis examines the impact of the COVID-19 pandemic by race and ethnicity through the lens of premature mortality, using the measures of premature mortality rate and years of life lost among excess deaths that occurred during the pandemic.

While the pandemic has had devastating effects across all racial and ethnic groups, we find significant racial disparities in premature death during the pandemic. Consistent with pre-pandemic trends, some communities of color faced higher premature death rates during the pandemic than their White counterparts. For all groups of color, though, the pandemic was associated with a steeper increase in the premature death rate than for White people.

The analysis is available through the Peterson-KFF Health System Tracker, an online information hub that monitors and assesses the performance of the U.S. health system.

Update on the Status of Medication Abortion and the Courts

Authors: Laurie Sobel, Alina Salganicoff, and Mabel Felix
Published: Apr 21, 2023

On June 13, 2024, the Supreme Court of the United States ruled in Alliance for Hippocratic Medicine (AHM) v. FDA that the AHM does not have standing to sue the FDA for injury. However, three state Attorneys’ Generals have intervened in this case in district court, and it is unclear how this action will shape the case when it goes back to the 5th Circuit Court of Appeals and then back to the originating federal district court.

On April 21st, the US Supreme Court blocked a lower court order that would have stopped the distribution and availability of the medication abortion drug, mifepristone, across the country. The high court’s ruling allows the current FDA rules to remain in effect, keeping mifepristone available for medication abortion where and when abortion is legal as the case proceeds through the courts. Telehealth abortions can also continue, where state law permits.

The court is responding to a ruling issued by Judge Matthew Kacsmaryk, the only judge in the US District Court for the Northern District of Texas Amarillo Division, who issued a preliminary injunction in the case, Alliance for Hippocratic Medicine v. FDA. The plaintiffs are challenging the FDA’s approval of mifepristone, one of the drugs used in medication abortion, claiming the FDA’s approval process and subsequent modifications of the conditions for dispensing mifepristone (known as REMS) as being beyond the FDA’s authority. The plaintiffs also contend that an 1873 anti-obscenity law, the Comstock Act, prohibits the mailing of any medication used for abortion (for details on the case see: Legal Challenges to the FDA Approval of Medication Abortion Pills).

Judge Kacsmaryk’s ruling would have blocked the FDA’s approval of mifepristone, which dates back to the year 2000. The judge delayed the enforcement of his own decision for seven days to give the FDA time to seek emergency relief from the U.S. Court of Appeals for the Fifth Circuit. The FDA and Danco Laboratories LLC (a party in the litigation, and the holder of the new drug application for Mifeprex, the brand name for mifepristone) appealed to Fifth Circuit Court of Appeals requesting a stay of Judge Kacsmaryk’s order pending the appeal (Figure 1). The Fifth Circuit Court of Appeals then issued an order which stayed part of the district court’s preliminary injunction (finding that the drug’s approval could not be revoked) but blocked the implementation of the changes that the FDA had made in 2016 to modify the agency’s conditions on the provision and dispensation of the drug (REMS). This decision would have effectively required the conditions that the FDA had in place 2011 to be re-introduced, taken the generic alternative drug off the market (GenBioPro), and required a relabeling of the drug. In addition, it would have required the drug to only be dispensed in person by a doctor, blocking the current ability of abortion providers and pharmacies to mail the drug.

Figure 1 – Key Points in the Timeline of Alliance for Hippocratic Medicine v. FDA

On April 14, 2023, the FDA and Danco filed an emergency appeal with the Supreme Court, requesting either a stay of the district court’s ruling pending the appeal or for the Supreme Court to take the AHM case on an expedited basis. Later that day, Justice Alito, the justice assigned to emergency requests from the Fifth Circuit, issued an administrative stay keeping mifepristone available without any changes until April 19, 2023, which was subsequently extended to April 21, 2023.

On April 21, 2023, the Supreme Court blocked the district court’s ruling, sending the case back to the US Court of Appeals for the Fifth Circuit. Access to mifepristone will not change while this litigation continues through the final decision of the Supreme Court if their review is sought again.

It is important to recognize that this Supreme Court ruling is the not Court’s final word on the availability of mifepristone. The high court has sent this back to the Fifth Circuit to consider the appeal of the preliminary injunction (that is, the temporary block on mifepristone’s approval by Judge Kacsmaryk). The Fifth Circuit Court has scheduled an expedited hearing of the case for May 17, 2023, which will be the next step for this case. Procedurally, the Fifth Circuit is only considering the FDA and Danco’s appeal of the district court’s decision to temporarily block the FDA’s approval of mifepristone while the litigation proceeds. The district court has not yet considered the case on the merits. In the meantime, access to mifepristone will remain where abortion is permitted by state law.

Changes to Medicare Part D in 2024 and 2025 Under the Inflation Reduction Act and How Enrollees Will Benefit

Published: Apr 20, 2023

The Inflation Reduction Act of 2022 includes several provisions to lower prescription drug costs for people with Medicare and reduce drug spending by the federal government, including a number of changes to the Medicare Part D drug benefit. These changes include a cap on out-of-pocket drug spending for enrollees in Medicare Part D plans and requiring Part D plans and drug manufacturers to pay a greater share of costs for Part D enrollees with high drug costs. This brief provides an overview of the Part D benefit design and Part D enrollee cost-sharing requirements in 2023 and changes coming in 2024 and 2025.

What Does the Medicare Part D Benefit Look Like in 2023?

The standard design of the Medicare Part D benefit currently has four distinct phases, where the share of drug costs paid by Part D enrollees, Part D plans, drug manufacturers, and Medicare varies (Figure 1). (The Part D enrollee shares reflect costs paid by enrollees who are not receiving low-income subsidies.)

  • In the deductible phase, Part D enrollees pay 100% of their drug costs, up to $505 in 2023. Not all Part D plans charge a deductible, but many enrollees in stand-alone PDPs are in a plan that charges the standard deductible in 2023.
  • In the initial coverage phase, Part D enrollees pay 25% of total drug costs and Part D plans pay 75%, up to total drug costs of $4,660 in 2023. However, most Part D plans charge a mix of copayments and coinsurance in this phase rather than a standard 25% coinsurance rate.
  • In the coverage gap phase, Part D enrollees pay 25% of total drug costs for both brand-name and generic drugs. Part D plans pay the remaining 75% of generic drug costs and 5% of brand drug costs, and drug manufacturers provide a 70% price discount on brands (there is no manufacturer price discount on generics).
  • In the catastrophic phase, Medicare pays 80% of total drug costs (known as “reinsurance”), Part D plans pay 15%, and Part D enrollees pay 5%. Part D enrollees qualify for catastrophic coverage when the amount that they pay out of pocket plus the value of the manufacturer discount on the price of brand-name drugs in the coverage gap phase exceeds a certain threshold amount. In 2023, the catastrophic threshold is set at $7,400, and enrollees themselves will pay about $3,100 out of pocket before reaching the catastrophic phase (this estimate is based on using brand drugs only).
Under the 2023 Medicare Part D Standard Benefit, Part D Enrollees Pay a $505 Deductible and 25% of Total Drug Costs Up to the Catastrophic Threshold and Then 5% Coinsurance

How Is the Medicare Part D Benefit Changing in 2024?

In 2024, costs in the catastrophic phase will change: the 5% coinsurance requirement for Part D enrollees will be eliminated and Part D plans will pay 20% of total drug costs in this phase instead of 15%.

The 5% coinsurance requirement for Part D enrollees in the catastrophic phase will be eliminated

In 2024, once Part D enrollees without low-income subsidies (LIS) have drug spending high enough to qualify for catastrophic coverage, they will no longer be required to pay 5% of their drug costs, which in effect means that out-of-pocket spending for Part D enrollees will be capped. In 2024, the catastrophic threshold will be set at $8,000. This amount includes what Part D enrollees spend out of pocket plus the value of the manufacturer price discount on brands in the coverage gap phase. At this amount, Part D enrollees who take only brand-name drugs in 2024 will have spent about $3,300 out of their own pockets and will then face no additional costs for their medications.

To understand the impact of this change, it helps to consider what Part D enrollees without LIS currently pay for high-cost medications. For example, for the five drugs with the highest per capita Part D expenditures in 2021 used by more than 10,000 Part D enrollees – Revlimid, Pomalyst, Imbruvica, Jakafi, and Ibrance, all cancer treatments – annual out-of-pocket costs per drug in 2023 range from over $11,000 to nearly $15,000, and out-of-pocket costs for each drug in the catastrophic phase alone range from around $8,000 to nearly $12,000 (see methods for details) (Figure 2). (These estimates exclude the cost of other drugs that users of these drugs might be taking.) Eliminating the 5% coinsurance requirement in the catastrophic phase in 2024 means that Part D enrollees without LIS who use these or other high-cost medications covered by Part D will see thousands of dollars in savings.

Eliminating Coinsurance Above the Catastrophic Threshold in 2024 Will Lower Out-of-Pocket Costs by Thousands of Dollars for Medicare Part D Enrollees Who Use Expensive Drugs

Part D plans will pay a somewhat larger share of total drug costs above the catastrophic threshold

With the elimination of the 5% coinsurance requirement for Part D enrollees in the catastrophic coverage phase, Part D plans will be required to pay 20% of total drug costs in this phase in 2024, up from 15% in 2023 and prior years.

How Is the Medicare Part D Benefit Changing in 2025?

Changes in 2025 include a new $2,000 out-of-pocket spending cap, elimination of the coverage gap phase, a higher share of drug costs paid by Part D plans in the catastrophic phase, along with a new manufacturer price discount and reduced liability for Medicare in this phase, and changes to plan costs and the manufacturer price discount in the initial coverage phase.

Out-of-pocket drug spending will be capped at $2,000

Beginning in 2025, Part D enrollees’ out-of-pocket drug costs will be capped at $2,000. This amount will be indexed to rise each year after 2025 at the rate of growth in per capita Part D costs. (This cap does not apply to out-of-pocket spending on Part B drugs.)

For Part D enrollees who take only brand-name drugs, annual out-of-pocket costs at the catastrophic threshold will fall from around $3,300 in 2024 to $2,000 in 2025 (Figure 3). In other words, Part D enrollees who take only brands and have drug costs high enough to reach the catastrophic threshold could see savings of about $1,300 in 2025 relative to what they will spend in 2024.

For Medicare Part D Enrollees Who Use Only Brands, Out-of-Pocket Drug Costs at the Catastrophic Threshold Will Fall From About $3,300 in 2024 to $2,000 in 2025

The coverage gap phase will be eliminated

The coverage gap phase, where Part D enrollees had faced 100% of their total drug costs under the original Part D benefit design and currently face 25% of costs for brand and generic drugs, will be eliminated in 2025. This means that Part D enrollees will no longer face a change in their cost sharing for a given drug when they move from the initial coverage phase to the coverage gap phase, which is the case in most Part D plans today, since most plans charge varying cost-sharing amounts, rather than the standard 25% coinsurance, in the initial coverage phase.

Part D plans and drug manufacturers will pay a larger share of costs for catastrophic coverage, and Medicare will pay a smaller share

Medicare’s share of total costs in the catastrophic phase (reinsurance) will decrease from 80% to 20% for brand-name drugs and from 80% to 40% for generic drugs beginning in 2025. This reduction will help address concerns about the substantial increase in Medicare’s reinsurance payments to Part D plans over time, which accounted for close to half (48%) of total Part D spending in 2022, up from 14% in 2006, based on data from the Medicare Trustees 2023 annual report. Medicare Part D plans’ share of costs will increase from 15% to 60% for both brands and generics above the cap, and drug manufacturers will be required to provide a 20% price discount on brand-name drugs (Figure 4).

The Share of Medicare Part D Drug Costs Paid by Enrollees, Plans, Drug Manufacturers, and Medicare Will Change in 2024 and 2025

Part D plans and manufacturers will face changes to their share of total drug costs paid in the initial coverage phase

Drug manufacturers will be required to provide a 10% discount on brand-name drugs in the initial coverage phase beginning in 2025, replacing the 70% price discount in the coverage gap phase under the current benefit design. Part D plans will pay 65% of brand-name drug costs.

What Other Changes Are Being Made to Part D?

  • As of 2023, the out-of-pocket cost of insulin products is limited to no more than $35 per month in all Part D plans. In addition, adult vaccines covered under Part D, such as the shingles vaccine, are covered with no cost sharing.
  • Starting in 2024, people with Medicare who have incomes up to 150% of poverty and resources at or below the limits for partial low-income subsidy benefits will be eligible for full benefits under the Part D Low-Income Subsidy (LIS) Program. The law eliminates the partial LIS benefit currently in place for individuals with incomes between 135% and 150% of poverty.
  • Also starting in 2024, the calculation of the base beneficiary premium will be adjusted, as needed, to limit increases in the base premium to no more than 6% from the prior year. (Premiums for individual Part D plan premiums and annual plan-level premium increases will continue to vary, however.)
  • Starting in 2025, Part D enrollees will have the option of spreading out their out-of-pocket costs over the year rather than face high out-of-pocket costs in any given month.

This work was supported in part by Arnold Ventures. KFF maintains full editorial control over all of its policy analysis, polling, and journalism activities.

Methods

To illustrate the impact of eliminating the 5% coinsurance requirement in 2024, we used data from the Medicare Part D Spending by Drug dataset to identify the top five drugs in 2021 with the highest per capita total Part D spending used by more than 10,000 enrollees. The five drugs—all cancer treatments—are:

  • Revlimid: 45,601 users in 2021; average total Part D spending per beneficiary = $129,242
  • Pomalyst: 12,596 users in 2021; average total Part D spending per beneficiary = $126,634
  • Imbruvica: 26,044 users in 2021; average total Part D spending per beneficiary = $120,958
  • Jakafi: 12,664 users in 2021; average total Part D spending per beneficiary = $117,748
  • Ibrance: 18,781 users in 2021; average total Part D spending per beneficiary = $100,709

We then used the online Medicare plan compare tool to identify annual out-of-pocket costs for these medications in 2023 at a large national retail pharmacy chain in zip codes 94107 (San Francisco, CA) and 46202 (Indianapolis, IN). We identified annual out-of-pocket costs for each drug in the plan that offered the lowest annual total drug costs, including premiums, based on the default drug dosage information in the plan compare tool. The annual out-of-pocket cost for each drug did not vary geographically based on these zip codes. We separated annual out-of-pocket drug costs into the portion paid below and above the catastrophic threshold. Out-of-pocket amounts shown in Figure 2 reflect costs for the drug alone, excluding Part D premiums, and do not include costs for other drugs that users of these drugs might be taking. Total annual out-of-pocket costs in 2023 may be higher in other Part D plans or at other pharmacies.

For 2024, we used the standard Part D benefit parameters to identify how much a Part D enrollee would pay in out-of-pocket costs for a brand-name drug below the catastrophic threshold. For each of these drugs, Part D enrollees would reach the catastrophic threshold in one month.

Ending the Public Health Emergency for Medicaid Home- and Community-Based Services

Published: Apr 19, 2023

People who use home- and community-based services (HCBS) are at heightened risk of serious illness or death from exposure to COVID-19 and disproportionately likely to need hospital or nursing facility care if HCBS are unavailable. However, during the pandemic, there were fewer workers available and willing to provide services and extra safety precautions were required to prevent COVID-19 infection. Recognizing those challenges, the federal government provided states with new authorities to maintain access to HCBS during the public health emergency (PHE). The PHE has been in place since 2020 and will end on May 11, 2023. This policy watch explores the potential implications of ending the PHE for Medicaid HCBS programs, including new or continued workforce challenges and potential reductions in patients’ access to care.

In 2020, an estimated 6 million people used HCBS according to CBO estimates. HCBS are provided in peoples’ homes and other non-institutional settings. They include medical and supportive services that assist people with the activities of daily living (such as eating, bathing, and dressing) and instrumental activities of daily living (such as preparing meals, managing medications, and housekeeping). They are provided to people who need such services because of aging, chronic illness, or disability and may include personal care, adult daycare, home health aide services, transportation, and supported employment. Medicare generally does not cover HCBS and in 2020, Medicaid spent $162 billion on HCBS—a majority of the $245 billion in total HCBS spending. Although all states offer some HCBS through Medicaid, most services are optional for states, and states may cover different services for different types of Medicaid enrollees. To be eligible for Medicaid HCBS, individuals must have limited financial resources and significant functional impairments.

How Did States Support Medicaid HCBS During the PHE?

States used several types of authorities when responding to the COVID-19 PHE, including disaster-relief state plan amendments, 1115 waivers, and Appendix K changes to 1915c waivers. When the PHE ends on May 11, 2023, changes made through a disaster-relief state plan amendment or 1115 waiver will also end. Changes made using the Appendix K authority will expire within 6 months of the PHE ending (December 11, 2023). With 437 changes to HCBS programs made under Appendix K, it was the most widely used authority. Examples of Appendix K uses include changing processes for determining eligibility, authorizing services, and paying providers; expanding provider qualifications or which providers are eligible to be paid; and expanding the service delivery models. Some changes have ended already, others have been transitioned to permanent authorities, and some will end between May and November 2023 if not also transitioned.

In a survey of states on Medicaid HCBS in 2022, many states reported using PHE authorities to bolster their HCBS programs by expanding eligibility and services and addressing workforce challenges (Figure 1). Within the category of eligibility and enrollment, nearly all states reported making it easier for people to access HCBS through virtual evaluations (49 states), 10 states reported increasing the number of waiver slots, and 5 states reported increasing eligibility limits. In terms of services, the most common change was providing HCBS via telehealth (47 states), followed by increasing utilization limits (37 states). Half of the states added new HCBS and around a quarter removed prior authorization requirements.

Many states reported that they planned to continue the PHE policies after the authority expires, but in other cases, states expect the policies will end or have not yet decided.  Fewer than half of states that allowed virtual evaluations reported plans to continue doing so after the PHE ends, and eligibility levels will return to their pre-pandemic levels in at least four of the five states with higher limits. Most states reported that they plan to continue providing HCBS via telehealth, but prior authorization and utilization limits may return to pre-pandemic levels in half or more of states that had made changes.

States Used Public Health Emergency Authorities to Make Wide-Ranging Changes to Their Medicaid HCBS Programs

During the PHE, most states (39) reported responding to workforce challenges by allowing family caregivers to be paid, but only 20 states plan to continue that policy after the PHE ends (Figure 2). In a 2022 survey, states reported that maintaining a workforce was the biggest challenge for HCBS programs and the primary effect of COVID-19 on HCBS programs was to amplify existing workforce shortages. Recent analysis on the Peterson-KFF Health System Tracker shows that, as of October 2022, the number of workers providing long-term services and supports was measurably lower than in early 2020. Allowing family caregivers to be paid providers was an important tool in responding to shortages of HCBS workers stemming from the pandemic, but this authority will be ending in many states—even as workforce shortages persist.

Most states provide HCBS through “waiver” programs that allow them to limit eligibility and, in many cases, to people with certain types of health conditions. In a 2022 survey of states, the most frequently reported waivers were those serving people with intellectual or development disabilities (47 states), and of those, 28 states allowed family caregivers to be paid providers. When the PHE ends, 14 states will continue the policy, but 8 states are planning to end it, and the outcome is undecided in 6 states. The second most reported waivers were for adults ages 65 and older or with physical disabilities (42 states), and of those, 28 states allowed family caregivers to be paid providers. That policy will continue in 11 states, end in 8 states, and is unknown in 9 states.

39 States Allowed Family Caregivers to be Paid Providers Under a PHE Authority, but That Policy Will End for Some HCBS Users

What to Watch in Medicaid HCBS as the PHE Ends?

Looking ahead, the loss of PHE flexibilities could further exacerbate workforce challenges for HCBS programs. Many elements of life have started to return to pre-pandemic norms, but Medicaid HCBS programs continue to face major workforce challenges. Loss of the PHE flexibilities—and in many states, the end of paying family caregivers—may further exacerbate those challenges. Some challenges may be addressed, in part, with HCBS funding from the American Rescue Plan Act, which states may spend until March 31, 2025. A recent analysis of states’ spending plans for those funds found that 32 states were increasing payment rates for HCBS providers, 39 were funding provider training and certifications, and many states were engaging in other activities that could help bolster the HCBS workforce.

Unwinding the Medicaid continuous enrollment provision may create additional challenges for people who use HCBS. Between February 2020 and March 2023, states received enhanced federal funding for Medicaid in exchange for keeping people continuously enrolled in Medicaid. States were able to resume disenrollments starting April 1, 2023 and the enhanced federal funding will phase down through December 2023 if certain conditions are met. During the unwinding, some people who use HCBS could lose their Medicaid eligibility—either because they are no longer eligible or because they face administrative barriers to complete renewals. The phasing-out of enhanced federal funding could create state budget pressure and result in fewer resources for optional services such as HCBS in response.

Longer-term it is unclear whether more significant changes for HCBS are possible, including potential changes that would attempt to reduce or eliminate HCBS waiting lists. On April 18, the White House issued a statement summarizing a series of executive actions that include provisions aimed at strengthening the HCBS workforce. Those provisions include enhancing job quality for people who provide Medicaid HCBS, providing support for family caregivers of people with dementia through Medicare, and supporting HCBS workers who want to further professionalize or join a union. The president’s budget has called for an additional $150 billion in funding for Medicaid HCBS and there are legislative proposals that would increase federal funding for HCBS. However, proposals to increase federal funding for Medicaid HCBS face long odds in a divided Congress. There are competing proposals to significantly reduce the federal government’s spending on Medicaid, though those are unlikely to gain support of the White House or Democrats in the Senate. At the same time, states face pressure to provide HCBS to the growing number of people who need long-term services and supports and wish to receive them in their homes.

News Release

KFF Health News’ “Diagnosis: Debt” Series Wins Top Digital Media Honor from the National Institute for Health Care Management (NIHCM) Foundation

Published: Apr 19, 2023

KFF Health News has taken top honors in the National Institute for Health Care Management (NIHCM) Foundation’s 2023 Awards in Journalism and Research for its series “Diagnosis: Debt.” The multifaceted reporting partnership among KFF Health News, NPR, and CBS News explores the scale, impact, and causes of medical debt in America.

“Diagnosis: Debt” won first place in the digital media category, which included more than 70 entries from news organizations including The Washington Post, ProPublica, and NBC News. Judges cited the series for its powerful and compelling use of storytelling, graphics, and original data to illustrate one of the most difficult issues affecting patients today.

“Diagnosis: Debt” examined the stories behind the more than 100 million people in America who have been pushed into debt by the nation’s health care system, revealing the epidemic of medical debt that has become a defining feature of the American system. In personal, multimedia stories, “Diagnosis: Debt” documented the suffering and sacrifices this burden forces on patients and their families.

“This project is at the heart of our mission at KFF Health News: in-depth journalism that looks at the impact of the health system on people,” said KFF President and CEO Drew Altman, founding publisher of KFF Health News.

The project drew on a nationwide poll, the “KFF Health Care Debt Survey,” designed and analyzed by KFF’s journalists and public opinion researchers, as well as new research into debt and hospital finances, and original investigations by reporters. The investigations included a review of thousands of court records to expose debt collection by nursing homes and an analysis of hospital contracts obtained through public records requests. The most ambitious effort reflected a detailed examination of billing and collection policies at hundreds of U.S. hospitals, many of which resisted public disclosures. That reporting informed an interactive data visualization that allows readers to see the practices of hospitals near them.

The yearlong project was led by Noam N. Levey, a senior correspondent at KFF Health News, and his editor, Kelly Johnson, and included work by Aneri Pattani, a correspondent at KFF Health News; Yuki Noguchi, a correspondent on the Science Desk at NPR; Anna Werner, a consumer investigative national correspondent for CBS News; Juweek Adolphe, a web developer and designer; Bram Sable-Smith, a Midwest correspondent at KFF Health News; Megan Kalata, a writer at KFF Health News; and Terry Byrne, copy chief at KFF Health News. KFF Health News continues to explore the topic.

Medical debt has also been a focus of KFF’s recent policy analysis work, including resources such as “The Burden of Medical Debt in the United States,” “Americans’ Challenges with Health Care Costs,” and “Could Consumer Assistance Be Helpful to People Facing Medical Debt?

News Release

Nearly Half of Those Likely Eligible for DACA are Uninsured

Published: Apr 14, 2023

Yesterday, the Biden Administration announced a plan to expand eligibility for Medicaid and ACA Marketplace health coverage to Deferred Action for Childhood Arrivals (DACA) recipients. A KFF analysis finds 47% of individuals likely eligible for DACA are uninsured compared to 10% of U.S. born individuals in their age group.

The analysis estimates that among those likely eligible for DACA:

  • 84% are in a family with at least one full-time worker,
  • 54% of adults work full-time,
  • 43% have incomes below 200% of the federal poverty level.

DACA recipients are more likely to be in low-wage jobs without employer-sponsored health insurance. For those without employer coverage or the ability to afford individual market coverage, they are currently prohibited from enrolling in Medicaid, CHIP and ACA Marketplace coverage. A few states do provide state-funded health coverage regardless of immigration status.The Biden Administration is planning to take administrative action to provide health coverage. However, the future of the DACA program is uncertain pending federal court decisions.The updated brief provides an overview of the DACA program and its roughly 580,000 active recipients at the end of 2022.

PEPFAR Reauthorization on the Horizon

Published: Apr 14, 2023

In this Think Global Health (an initiative from the Council on Foreign Relations) opinion piece, Jennifer Kates and Kellie Moss discuss what could happen as Congress considers reauthorizing the United States’ signature initiative on global health.