As states unwind the Medicaid continuous enrollment provision, data show that large shares of people are being disenrolled for paperwork or procedural reasons as opposed to being determined ineligible. These high procedural disenrollment rates are raising concerns that many people who remain eligible for Medicaid may, nevertheless, be losing coverage. But, there are different procedural disenrollment rates being reported that can be confusing to interpret. This policy watch explains how the different rates are calculated, provides insights for interpreting the data, and describes steps the Centers for Medicare and Medicaid Services (CMS) and states are taking to reduce procedural disenrollments.

What are procedural disenrollments?

Procedural disenrollments occur when there is no definitive determination of ineligibility. Procedural disenrollments may happen because enrollees do not receive renewal notices or face barriers to completing the redetermination process, such as not understanding what steps need to be taken. In some cases, people may be procedurally disenrolled because eligibility workers are not able to process documents enrollees have submitted before cases are automatically closed. Some enrollees may know they are no longer eligible, perhaps because of an increase in income or other change in circumstance, and do not respond to the renewal request so the state cannot make a definitive determination that the person is no longer eligible. While some states are reporting reasons for procedural terminations that indicate whether someone may be over income or did not respond, these data are limited. The main concern with procedural disenrollments is that many people losing Medicaid for these paperwork reasons may still be eligible and do not have another source of health coverage.

How are the procedural disenrollment rates calculated and how should different rates be interpreted?

Different procedural disenrollment rates are being reported for states because of differences in how those rates are calculated. When calculating procedural disenrollment rates, the denominator and timeframe matter. A procedural disenrollment rate calculated using total disenrollments as the denominator is going to be higher than a rate that uses all initiated renewals, which includes enrollees whose coverage was renewed as well as cases that remain pending, as the denominator. Additionally, a cumulative procedural disenrollment rate based on all reported renewal data since the start of the unwinding period is going to differ from one that is cohort based and reflects only procedural disenrollments for a single month. The cumulative procedural disenrollment rate reported by KFF, 73% as of September 5, 2023, uses total disenrollments as the denominator, highlighting that a substantial majority of disenrollments are for paperwork reasons rather than for people being definitively determined ineligible. In contrast, the cumulative procedural disenrollment rate using all initiated renewals as the denominator is 20%, reflecting the fact that many people have had their coverage renewed (Figure 1).

Reporting procedural disenrollments as a share of total disenrollments isolates procedural disenrollments and can help to identify systems or other issues. High procedural disenrollment rates using this methodology may reflect problems with mail delivery, backlogs in processing returned forms, or problems complying with federal regulations related to processing redeterminations. In contrast, states with lower procedural disenrollments as a share of total disenrollments may have more effective processes and procedures for contacting enrollees; they may provide a longer timeframe for enrollees to respond; or they may have more robust systems that streamline the process for returning renewal forms or submitting documentation.

Examining procedural disenrollments as a share of people renewed or the share of all initiated renewals can provide important context for understanding the data. States that are renewing large shares of people each month or that are holding redetermination cases open to give enrollees more time to respond may have lower overall disenrollment rates, even if their procedural disenrollment rates as a share of total disenrollments are high. An example is the District of Columbia, which has a 90% procedural disenrollment rate as a share of total disenrollments that drops to just 27% when calculated as a share of total completed renewals because DC is renewing coverage for 70% of enrollees (Figure 2). While some states, such as Texas, have procedural disenrollment rates that are higher than the national average for each measure, other states, such as Michigan, have rates that are lower.

How are CMS and states addressing high procedural disenrollment rates?

CMS has sent letters to states identifying concerns with high procedural disenrollment rates and potential systems issues contributing to inappropriate procedural terminations. On August 9, 2023, CMS sent letters to states expressing general concern over procedural disenrollment rates and urging states to take action to reduce those rates. CMS flagged 28 states where the agency deemed the procedural disenrollment rate to be too high. The rates reported in the letters were for May 2023 only, using total renewals initiated in the month as the denominator, and CMS defined a high procedural disenrollment rate as greater than 10%, More recently, CMS sent a letter to state Medicaid Directors on August 30, 2023 identifying a potential issue related to how some states are processing ex parte renewals (i.e., renewals that make use of electronic data sources documenting income and other circumstances) that could be contributing to inappropriate procedural terminations for some individuals, including children. According to the letter, any state that is out of compliance with federal rules must implement a mitigation strategy until the issue is fixed, reinstate coverage for all individuals who were improperly terminated for procedural reasons, and pause procedural disenrollments for individuals who may be affected.

Most states have adopted at least some of the flexibilities CMS has made available during the unwinding period aimed at reducing procedural disenrollment rates. More recently but prior to the release of the CMS letters, some states extended renewal notice timelines by 30 days to give people additional time to respond and to give states additional time to reach out to enrollees who have not yet responded. Other states temporarily paused procedural disenrollments for certain cohorts or for all enrollees. In light of the recent CMS letters, states can be expected to adopt additional strategies to reduce procedural disenrollments.

Enhanced Marketplace subsidies have continued to drive up enrollment in the individual market, and the loss of Medicaid coverage by millions of people could contribute to this trend, according to a new KFF analysis. Meanwhile, enrollment in non-ACA-compliant plans is at a record low.

As of early 2023, an estimated 18.2 million people have individual market coverage, the highest since 2016. Individual market enrollment grew by about 29% between early 2020 and early 2023 — a result of enhanced subsidies introduced by the Inflation Reduction Act, increased outreach, and an extended enrollment period.

This enrollment growth could continue in 2023 as states resume Medicaid disenrollments amid the unwinding of the continuous enrollment provision. Some of the people losing Medicaid coverage may be eligible for subsidies on the ACA Marketplaces.

Due in part to the enhanced subsidies, about 4 in 5 individual market enrollees have subsidized coverage — the highest share since the ACA was implemented.

The number of people in non-compliant plans has fallen each year and could decrease further due to the Biden Administration’s proposed rule that would reverse the expansion of short-term plans. An estimated 1.2 million people were in non-ACA-compliant plans in mid-2022, compared to 5.7 million in mid-2015. These short-term plans often do not include certain benefits or coverage for pre-existing conditions and can impose a dollar limit on insurance coverage.

If unsubsidized premiums rise in 2024 due to higher health care prices and utilization, enhanced subsidies could shield most individual market enrollees from increases in their monthly payments.

With Marketplace enrollment at a record high in early 2023, the upcoming open enrollment period could be among the busiest yet. In addition to Marketplace enrollees renewing coverage, uninsured people and those buying individual coverage off-Marketplace – as well as those losing Medicaid coverage as the pandemic-era continuous enrollment provision unwinds – may want to check if they are eligible for expanded subsidies under the Inflation Reduction Act.

This analysis looks at how many people are signed up for each type of individual market coverage—both on- and off-Marketplace and with or without subsidies—as of early 2023. The number of people enrolled in compliant and non-compliant plans was also evaluated up to 2022, the latest year this data is publicly available. A key takeaway from this analysis is that as Marketplace enrollment has reached record highs with enhanced premium assistance, fewer people are buying coverage off-Marketplace, but the overall individual market is nonetheless growing.

Individual market enrollment continues to grow, driven by enhanced subsidies. As of early 2023, an estimated 18.2 million people have individual market coverage, the highest since 2016 (Figure 1). The individual health insurance market grew rapidly in the early years of ACA implementation, reaching nearly 20 million people in early 2015, nearly double the approximately 11 million signed up before the ACA. However, these enrollment gains were partially offset by subsequent declines driven by steep premium increases, particularly among people not receiving subsidies. By early 2020, the individual market had declined to about 14 million enrollees.

During this period of decreasing individual market enrollment, subsidized enrollment increased from 2017-2019 which corresponds with the Trump Administration ending federal cost-sharing reduction (CSR) payments; this led to insurers “silver loading” premiums for CSRs and increased premium subsidies for some.

With passage of enhanced subsidies in the American Rescue Plan Act (ARPA), combined with boosted outreach and an extended enrollment period, 2021 marked the first year since 2015 when there was an increase in individual market enrollment. Individual market enrollment grew about 5% from 14.1 million in first quarter 2020 to 14.9 million in first quarter 2021.

The ARPA’s subsidies didn’t simply bring people from off-Marketplace plans to the Marketplace; the subsidies also helped bring overall individual market enrollment higher, up to 18.2 million in early 2023, an increase of about 29% from early 2020.

Now, with enhanced subsidies in place, the vast majority of people buying individual market coverage are subsidized. The Inflation Reduction Act continues the ARPA subsidies without interruption for another three years through 2025. That means premiums are capped for people with incomes over 400% of the poverty level ($120,000 for a family of 4 in 2024) who were ineligible for subsidies previously, and those who were already eligible for subsidies are paying even less than they were before. Overall, about 4 in 5 individual market enrollees are now subsidized (Figure 2) – the highest share since the ACA was implemented – and some of those who aren’t receiving a subsidy might find they are eligible if they moved onto the Marketplace.

Heading into 2024 open enrollment, we estimate there are still about 2.5 million people buying unsubsidized coverage off-Marketplace, including some in non-ACA-compliant plans (like grandfathered and short-term plans). Early 2023 off-Marketplace enrollment decreased by 20% compared to early 2022. Despite Trump Administration efforts to promote non-compliant coverage, the number of people in non-compliant plans has fallen each year.

While enrollment in non-ACA-compliant plans is at a record low, a substantial number continue enrolling in non-compliant plans. Using federal risk adjustment data and data compiled by Mark Farrah Associates, we estimate 1.2 million people were in non-ACA-compliant plans in mid-2022, compared to 5.7 million in mid-2015 (Figure 3). Although we don’t yet have complete 2023 data, it’s likely ACA-compliant enrollment (both on- and off-Marketplace) is currently at a record high and that non-compliant enrollment is at a record low.

Non-compliant short-term plans often do not include certain benefits or coverage for pre-existing conditions, and can impose a dollar limit on insurance coverage. For example, of short-term plans reviewed, none covered maternity care, most didn’t cover prescription drugs, about half didn’t include mental health or substance use treatment, and most imposed a dollar limit on covered services or drugs. The Biden Administration’s proposed rule, which would reverse Trump Administration’s expansion of short-term plans, may further reduce enrollment in non-compliant plans if it is finalized.

The share of individual market enrollment in ACA compliant plans has increased to 93% in mid-2022 compared to 71% in mid-2015. These data are only available through mid-2022, and non-compliant enrollment may have fallen even further in 2023.

Some off-Marketplace enrollees will find they are still ineligible for subsidies, even with enhanced subsidies. Undocumented immigrants and people with affordable offers of employer coverage are ineligible for Marketplace subsidies. Additionally, although there is no longer an upper income limit for subsidies, people with higher incomes who would pay less than 8.5% of their income for an unsubsidized benchmark silver plan do not qualify for subsidies because their premium isn’t high enough to trigger financial help. Even so, some of the latter group may find it advantageous to purchase on the Marketplace because if they experience midyear changes in their income or other circumstances, they may begin receiving subsidies mid-year without changing plans or they could retroactively claim a subsidy when they file taxes.

Yet others who were previously ineligible for Marketplace subsidies may now be eligible. For example, the Biden Administration’s fix to the “family glitch” means dependents of workers, who have affordable self-only coverage but unaffordable family coverage through their employers, can get Marketplace subsidies starting in 2023.

Marketplace enrollment data are as of the first quarter of 2023. In the second quarter of 2023, states started to disenroll people from Medicaid, some of whom may be signing up for subsidized Marketplace coverage.

How might future premium increases affect people in the individual market? Looking back over the last ten years of the ACA, changes in individual market enrollment closely mirror changes in what people had to pay for coverage. In years when premiums were rising steeply from 2016-2018, unsubsidized individual market enrollment fell. When premiums held mostly steady from 2019 to 2020, so did individual market enrollment. Then, as new subsidies became available in 2021-2023, individual market enrollment picked up again, driven by an increase in the number of subsidized enrollees.

Heading into 2024, we may see unsubsidized premiums rise, pushed up by rising health care prices and utilization. However, unlike when premiums rose in past years, the Inflation Reduction Act’s enhanced subsidies could shield the vast majority of individual market enrollees from increases, even those with higher incomes. In fact, some people who aren’t subsidized in 2023 may find premium increases in 2024 make them newly eligible for subsidies (if their benchmark premium rises above 8.5% of their income). But, to take advantage of subsidies, they would need to shop on the Marketplace during open enrollment.

Methods

Federal enrollment and risk adjustment data were combined with administrative data insurers report to state regulators, as compiled by Mark Farrah Associates, to determine the number of enrollees in each type of individual market coverage. Early effectuated enrollment reports (available for years 2015-2023) were used to determine the number of on-Marketplace and subsidized enrollees. Risk adjustment data (available for years 2014-2022) were used to determine the total number of enrollees in ACA-compliant plans. The number of compliant enrollees in Massachusetts and Vermont in 2015-2021 and Massachusetts in 2022 was estimated using a ratio of total Exchange enrollment to total compliant enrollment in all the other states.

Mark Farrah Associates data were used to estimate the total number of enrollees in the individual market. Because some plans do not file quarterly data, we adjust these plans’ enrollment numbers based on enrollment changes seen in plans that do file quarterly. We also remove likely Children’s Health Insurance Program, or CHIP, enrollees from the individual market total.

As the Biden administration begins the process of negotiating prices for 10 costly drugs on behalf of Medicare and its beneficiaries as authorized in last year’s Inflation Reduction Act, KFF Executive Vice President for Health Policy Larry Levitt probes some likely arguments against it in this op-ed column in The New York Times. The column also examines the policy and political implications of the debate and pending legal challenges.

This document was updated on Sept. 8, 2023 to cite a related analysis.

Key health organizations began recognizing obesity as a disease a decade or more ago and treatment methods for the condition have ranged from behavior change counseling to bariatric surgery. A class of prescription drugs (GLP-1) that can result in substantial weight loss is emerging as a potentially revolutionary treatment for the one-third of U.S. adults who are obese* (having a body mass index of 30 or above). But, health coverage and access in the fragmented U.S. health care system is determined by many actors, and the rate of obesity in the state of residence could factor into coverage, and therefore how accessible and affordable this class of drugs is for patients.

A look at KFF’s State Health Facts indicator of the distribution of adults with a body mass index (BMI) of 30 or more shows that the 20 states with the highest rates of obesity are all in the Midwest and South, as classified by the U.S. Census Bureau (Figure 1).

When comparing average obesity rates by region (Figure 2), adult rates in the Midwest and South are about five percentage points higher than the Northeast and six percentage points higher than the West.

The cost of treating adults who are obese with GLP-1 drugs would be substantial in the near term and could impact coverage policies. For state Medicaid programs in the Midwest and South, and employers and insurers with a significant presence in these regions, the higher rates of obesity among residents may factor into their decisions. Also a factor in access to these drugs, seven of ten states that have not adopted the Affordable Care Act’s Medicaid expansion and nearly all (97%) of the people experiencing a coverage gap due to non-expansion are in the South.

Currently, Medicaid coverage for drugs prescribed for weight loss varies by state but is generally limited for GLP-1 drugs, and employer-based and private insurance coverage of weight-loss drugs also varies. The Medicare program does not cover the drugs for weight loss due to a legislative ban.

Recent reports (Business Insider, STAT, WSJ) reveal some employers previously covering GLP-1 drugs are pulling back coverage and health insurers are scrutinizing physicians’ off-label prescribing. With the prospect of a dramatic increase in costs if the class of drugs continues to gain FDA approval, coverage of the drugs could stall, drop, or be restricted, including limiting coverage eligibility to people with a higher body mass index. (Obesity is typically classified into three ranges of BMI. The American Medical Association recently clarified its policy on the role of BMI as a measure of obesity, noting historical problems and its limitations.) Other potential actions include:

• Limiting off-label use,
• Requiring additional treatment like behavioral therapy in conjunction with the drugs,
• Prior authorization, including step-therapy to try less expensive options first, and
• Higher cost-sharing.

The early clinical results and potential of new prescription drugs for weight loss have caught the interest of nearly half of U.S. adults. Federal and state policymakers, employers and insurance coverage providers are in the early stages of considering these drugs’ potential costs and benefits in determining if and how to cover them in insurance plans. The long-term cost savings from a reduction in obesity and its related risks in the country could be substantial. Still, the current U.S. prices of these drugs for weight loss are high and their lifetime use may be required for continued health benefits. It is also important to note that some patients prescribed the drugs are experiencing side effects and their use’s long-term impact remains a question.

With adults in the Midwest and South having higher obesity rates, states’ coverage programs and regional employers could face higher health insurance costs – particularly in the short term – and seek ways to control the use of newer weight-loss drugs. As coverage of GLP-1 prescription drugs develops, regional trends could diverge.

*The Centers for Disease Control and Prevention’s (CDC) National Health and Nutrition Examination Survey, using clinical measurements, estimates about four in ten adults are obese. KFF estimates are based on analysis of state-level Behavioral Risk Factor Surveillance System self-reported data collected by the CDC and state health departments via phone calls.

Climate change-related extreme heat events have lengthened, become more frequent, and increased in intensity over the past few decades with some of the worst conditions and impacts observed in Summer 2023. Across the globe and the country there have been rising incidents of extreme heat, and air quality events. June 2023 became the hottest June on record, globally, while smoke from wildfires in Canada driven by climate change-related heat resulted in significant air pollution that affected more than 60 million people in the U.S. In August, prolonged dry conditions and high winds in Hawai’i laid the foundation for wildfires that caused massive destruction on the island of Maui and other areas of the islands, resulting in the largest loss of life due to wildfires in modern U.S. history. As temperatures continue to rise and extreme heat events that are linked to adverse health outcomes become more frequent in the U.S., people of color and other underserved communities are disproportionately affected.

Extreme heat can have serious health impacts, including death. According to the Community Resilience Estimates (CRE) for Heat tool developed by the U.S. Census Bureau and Arizona State University, which accounts for factors such as housing quality, transportation exposure, and financial hardship, nearly a quarter of people in the U.S. are socially vulnerable if exposed to extreme heat. Extreme heat is the leading cause of weather-related deaths, killing more people in the U.S. than any other weather phenomenon. According to mortality data from the Centers for Disease Control and Prevention, between 2018 and 2021, there were a total of 4,681 heat-related deaths, with the number of deaths rising each year from 2019 onward (Figure 1). However, studies suggest that this is likely a vast undercount, and other evidence shows that extreme heat is associated with higher all-cause mortality. One estimate pegs the cost of heat events in the U.S. at approximately $1 billion in excess health care costs each year and, if unaddressed, could cost the U.S. economy approximately $14.5 trillion over the next fifty years.

While extreme heat and other climate-related weather events have implications for everyone, they disproportionately affect historically marginalized groups who are at higher risk for dying from heat exposure. Recent literature shows that within the U.S., some communities of color have higher risks of heat-related mortality than White people. Consistent with trends in earlier years, between 2018-2021, AIAN people were most likely to die due to heat compared to all other racial and ethnic groups, and Black people had a higher rate of heat-related deaths compared to White people. The rate for Hispanic people was similar to that of White people, while Asian people had a lower rate of heat-related death (Table 1). Data also show that noncitizens are more likely to die from heat exposure compared with citizens.

These higher mortality risks reflect increased exposure to heat due to underlying inequities. Due to historically-codified residential segregation in the U.S. including “redlining,” on average, people of color have a higher likelihood of living in a census tract with higher summer daytime surface urban heat island intensity compared to their White counterparts. Low income communities and communities of color also suffer from tree inequity, increasing the risk of exposure to extreme heat and subsequent heat-related illnesses. Communities that live in these historically zoned areas are also more likely to have higher rates of asthma and cardiovascular illnesses and other diseases that increase their risk of poor health outcomes associated with exposure to climate change-related extreme heat and air pollution. The Southern U.S. and some areas in the Northeast and Midwest have experienced the greatest increases in the number of heat wave days in the U.S., which may have equity implications because these affected areas include higher shares of people of color, and are therefore more likely to be exposed to longer and more intense heat waves. Projections suggest that disparities in extreme heat exposure will continue to persist thirty years from now.

More limited access to air conditioning also contributes to disproportionate exposure to extreme heat and heat-related illnesses. Low-income households, which include disproportionate shares of people of color, face affordability challenges to accessing air conditioning. Lack of air conditioning increases risk of negative health outcomes including death due to heat exposure. Rising temperatures have been associated with increases in mortality among incarcerated people, a population in which people of color are overrepresented, and that sometimes has more limited access to air conditioning. The 2023 Texas heat wave highlighted the impact of lack of air conditioning in prisons. Approximately 13% of deaths in Texas prisons during warm months between 2001 and 2019 were associated with extreme heat in unairconditioned prisons. Further, as temperatures continue to rise, U.S. power grids may be unable to support the surges in energy use due to increase air conditioning and cooling infrastructure usage during heat waves and other extreme weather events.

People of color, noncitizen immigrants, and people with low incomes are more likely to work in jobs with climate-related health risks, including heat. Heat is a top cause of exertion-related occupational injuries and deaths. Workers at risk of heat stress include outdoor workers and workers in hot environments, such as construction workers, agricultural workers, factory workers, firefighters, among others. Migrant or immigrant workers make up significant proportions of farmworkers and are disproportionately exposed to environmental hazards, including heat.

The Occupational Safety and Health Administration (OSHA) and the Center for Disease Control and Prevention have heat stress prevention recommendations, but there currently are no national standards in place to protect workers from exposure to extreme heat. In 2021, OSHA issued a proposed rulemaking to protect workers from extreme heat exposure and heat stress in indoor and outdoor settings by seeking information on issues that may be considered in developing a standard. Since then, OHSA has established an enforcement initiative on heat-related hazards and created a National Advisory Committee to better understand challenges and identify and share best practices to protect workers. However, to date, a standard has not been established. As of Summer 2023, OSHA is seeking feedback from small businesses and local governments on the potential impact of a workplace heat standard on small businesses. Five states currently have occupational heat protection standards. In contrast, Texas Governor Gregg Abbott signed House Bill 2127 that limited local governments’ abilities to regulate work breaks. The law is expected to overturn local ordinances that mandate regular water breaks for workers, including construction workers who are disproportionately exposed to extreme heat

As extreme heat continues to worsen, strategies to mitigate exposure and reduce health risk will be of increasing importance. The Biden Administration has taken some steps to increase awareness and understanding of heat exposure and health risks, including launching a new heat.gov website, and plans to develop a National Heat Strategy. The newly established Office of Climate Change and Health Equity within the Department of Health and Human services aims to address the impact of climate change on health and is developing new tools to help track heat-related illnesses. Other agencies have taken steps to educate individuals and communities about how to protect themselves from extreme heat and to develop more climate-resilient communities. Ongoing efforts to address rising temperatures, reduce risks of heat exposure, and increase protections for those most at-risk for heat exposure will be important for reducing negative health impacts due to extreme heat particularly for groups who already face disparities in health.

A growing body of evidence shows that consolidation in health care provider markets has led to increases in prices without clear evidence of increases in quality. Policymakers and regulators have historically focused on consolidation within the same geographic area, but there have been a large number of mergers and acquisitions (referred to as “mergers” in this brief) between hospitals and health systems that operate in different regions (referred to as “cross-market mergers” in this brief), including several multi-billion dollar deals over just the past couple of years. Some experts have raised concerns that cross-market mergers could result in hospitals and health systems raising their prices. It is also possible that cross-market mergers could result in the elimination of service lines by some acquired hospitals, which may reduce access to care.

This issue brief explains the role and implications of cross-market mergers in hospital and health system markets and describes the approaches that government antitrust agencies have taken in reviewing these types of transactions.

What Is a Cross-Market Merger?

A “cross-market merger” entails a merger between two health care providers that operate in different geographic markets for patient care.^{1 , 2}  For instance, this term could apply to the following scenarios:

• Two health systems that operate in different geographic markets merge. For example, in April 2023, Kaiser Permanente and Geisinger announced their plans to merge. These systems operate in different regions of the United States, with Kaiser Permanente operating in five states in the West (including California) and Georgia, Maryland, Virginia, and DC and Geisinger operating in Pennsylvania. In 2022, Kaiser Permanente and Geisinger earned $95 billion and $7 billion in operating revenues, respectively.³ 
• A health system acquires an independent hospital in a geographic market where it does not operate. One example is Christus Health’s acquisition of Gerald Champion Regional Medical Center in July 2023. Christus Health is a large health system based in Texas that includes 28 hospitals, while Gerald Champion Regional Medical Center is an independent hospital in Alamogordo, New Mexico that is over 200 miles away from the nearest Christus Health facility.

Cross-market mergers can involve hospitals and health systems that are in neighboring markets as well as entities that are hundreds or even thousands of miles apart. An example of the former is the recent merger between University of Michigan Health—which is based in Ann Arbor, Michigan—and Sparrow Health System, which is based about 65 miles away in Lansing, Michigan. An example of the latter is the recently proposed merger of UnityPoint Health—which operates in the Midwest (Iowa, Illinois, and Wisconsin)—and Presbyterian Healthcare Services, which operates in New Mexico.

How Common Are Cross-Market Mergers?

Hospital and health system mergers are common, and many of these mergers involve providers in different geographic markets. For example, according to one study, about 1,500 hospitals were targeted as part of a completed merger or acquisition from 2010 through 2019 and most of these deals (55%) involved hospitals or health systems in different commuting zones. According to another study, about one in eight rural hospitals merged with an out-of-market hospital or health system from 2010 through 2018. A series of large, cross-market mergers in recent years have drawn further attention to this topic. Table 1 below provides examples of nine large, cross-market merger deals announced since June 2021, each of which entailed health systems with combined annual operating revenues of at least five billion dollars.

Cross-market mergers may be appealing to health systems that are seeking to expand for at least a couple of reasons. First, cross-market mergers have received little resistance from government antitrust agencies relative to mergers between health care providers that operate in the same market.⁴  Second, many health care markets are already highly concentrated, leaving fewer opportunities for health systems to expand within a given region.

What Are the Potential Implications of Cross-Market Mergers?

Cross-market mergers may benefit patients in some instances when hospitals and health systems are able to operate more efficiently as a combined entity. Even if hospitals and health systems are located in different markets, they may be able to share knowledge and best practices with each other, such as by collaborating to develop better clinical practice guidelines and sharing effective strategies and tools for managing patients’ care. Operating at a larger scale may also facilitate providers’ participation in complicated, value-based payment programs, which some health plans offer in an effort to reduce costs and improve the quality of care. Hospitals and health systems merging within and across markets can also potentially achieve efficiencies by purchasing goods and supplies in greater volume.

In some scenarios, small and struggling hospitals may seek to merge with large health systems in order to improve their finances or offer higher-quality services. For example, a large health system with deep pockets could provide a smaller hospital with resources to purchase new equipment and invest in quality improvements or provide a financial backstop and access to capital that may enable a struggling rural hospital to keep its doors open. A large, financially successful system could also share management strategies with hospitals that are losing money to help them operate more efficiently.

However, cross-market mergers may lead to higher prices. In fact, researchers have estimated that these types of deals have led to price increases ranging from 6 to 17 percent, though only a small number of studies have focused on cross-market mergers.

There are at least a few reasons why cross-market mergers could lead to price increases, even though they entail hospitals and health systems that are not competing against each other in the same area. First, a combined health system with providers in, say, different areas of a state may be able to use its dominant position in one market to negotiate higher prices in another when contracting with a given health plan (e.g., a state employee plan with enrollees that reside in several markets). Second, a combined health system may compete with other health systems that also operate across the same markets. In that case, the combined health system may be hesitant to offer lower prices in one market out of concern that their competitor will retaliate by lowering prices and undercutting them in other markets. Finally, a large system that, say, acquires a small hospital may have more expertise in bargaining with insurers, which it could use to negotiate for higher prices.

Another concern that has been raised about certain types of mergers, which could also apply to some cross-market mergers, is that they may reduce access to care. For instance, a large health system that acquires a small rural hospital may be less responsive to community needs and more willing to eliminate service lines, such as obstetric care. Relatedly, a hospital may also reduce spending on community benefits after being acquired by a health system.

How Do Government Antitrust Agencies Approach Cross-Market Mergers?

Federal and state antitrust agencies seek to promote competitive markets—often to benefit consumers—by scrutinizing mergers and other potentially anticompetitive practices. Antitrust agencies have historically focused on mergers between hospitals and health systems that operate in the same geographic market, though there are signs that they have begun to take a closer look at cross-market mergers. While federal antitrust agencies have yet to formally challenge a cross-market merger, the Federal Trade Commission (FTC) has identified these types of deals as an area of interest and has investigated at least two specific cross-market mergers (between Advocate Aurora Health and Atrium Health and between Spectrum Health and Beaumont Health).⁵ 

At the state level, the state attorney general in California has used its legal authority to impose conditions on mergers that have been identified as cross-market deals. These conditions have included, for example, placing restrictions on price increases and requiring that the merged entities maintain certain services, such as by having a minimum number of emergency room, intensive care, and obstetrics beds. In Minnesota, the state attorney general had begun to investigate whether to challenge a proposed merger between Fairview Health Services (based in Minnesota) and Sanford Health (based in South Dakota) before the two systems abandoned their plans in July 2023.

Cross-market mergers have never been fully-litigated by a federal or state antitrust agency, and doing so in the short term may be difficult. First, only a handful of analyses have focused on cross-market mergers, limiting the ability of regulators to cite potential consequences based on empirical evidence. Second, antitrust agencies have not yet released detailed guidelines for evaluating cross-market mergers,⁶  nor have they tested legal strategies for challenging cross-market mergers in the courts. In contrast, when antitrust agencies challenge within-market mergers, they can rely on years of legal precedent as well as economic frameworks recognized by the courts. Finally, antitrust litigation can be complex and expensive. Without adequate funding, it may be impractical to challenge a large number of health care provider business practices that raise anticompetitive concerns, including cross-market mergers. Given these challenges, it is conceivable that cross-market mergers will continue unabated in the near future.

Discussion

Hospital and health system mergers are common, and these mergers often involve providers in different geographic markets. Cross-market mergers may have benefits in some scenarios, for example, if the providers involved share effective clinical strategies for improving patient care. However, a handful of studies indicate that cross-market mergers can lead to increases in health care prices. It is also possible that some hospitals may become less responsive to community needs after a cross-market merger. Antitrust agencies have begun to take a closer look at mergers of hospitals and health systems across different geographic regions, which may have a bearing on affordability and access to care in many regions across the country, but they have yet to fully-litigate a cross-market merger.

Some policy and regulatory options have been floated that could address some of the concerns about cross-market mergers. For example, government regulators could use their existing authority to scrutinize cross-market mergers, which antitrust agencies have begun to do. States could enact laws to give government agencies authority to require some or all types of providers to obtain prior approval from the government before merging. California has done so, and attorneys general in the state have used this authority to impose conditions on cross-market mergers to limit price hikes and require that merging entities maintain certain services. In addition, regulators could prohibit certain types of clauses in contracts between providers and insurers that may allow merged entities to leverage market power to negotiate for higher prices in one market based on their strong position in another.⁷ 

Each of these policy and regulatory options would involve tradeoffs. For example, determining whether to challenge a given cross-market merger could entail weighing the potential benefits of a merger, such as allowing a small hospital to keep its doors open, against the potential for some harm, such as higher health care prices and potentially less access to care for patients in a given market. As the number of cross-market mergers increases, these concerns and tradeoffs are likely to be on the radar of policymakers and regulators.

1. This brief defines cross-market mergers based on providers being in separate geographic markets. We distinguish this from vertical mergers, which occur when there is consolidation between providers that offer different services along the same supply chain, such when a hospital acquires a physician practice. ↩︎
2. Regulators and researchers have long grappled with how to define the boundaries of geographic markets for health care services. As a result, a merger that is considered to cross markets by some may be identified as occurring within a single market by others. ↩︎
3. Kaiser Permanente and Geisinger are both integrated health systems that include both insurance plans and health care providers. Revenues reflect all sources of operating income. ↩︎
4. For example, in 2015, the Federal Trade Commission (FTC) initiated a legal challenge against a planned merger between two Illinois health systems—Advocate Health and Northshore University HealthSystem—arguing that the combined entity would control over half of the market for general acute care inpatient services in the North Shore area of Chicago.  The two systems eventually abandoned their plans to merge. However, Advocate Health was later involved in two cross-market mergers—first with Aurora Health (based in the neighboring state of Wisconsin) to form Advocate Aurora Health and then with Atrium Health (based in North Carolina, South Carolina, Georgia, and Alabama) to form Advocate Health. The Federal Trade Commission investigated the latter merger, but the government did not seek to challenge either merger in the courts. ↩︎
5. The Department of Justice (DOJ) and FTC have taken additional steps that indicate that they are taking a closer at cross-market mergers. For example: (1) in September 2021, the FTC announced that they would be considering cross-market effects in their reviews of large merger deals, (2) in February 2023 and July 2023, respectively, the two agencies withdrew from their health care policy statements which, among other things, may have created a safety zone for large health systems to acquire small hospitals in other markets, and (3) in July 2023, the two agencies released a draft version of their updated guidelines for reviewing mergers that included language which might be used to challenge cross-market mergers (though this is not yet clear). ↩︎
6. In July 2023, the FTC and DOJ released a draft version of their updated guidelines for reviewing mergers that included language which might be used to challenge cross-market mergers (though this is not yet clear). ↩︎
7. This would entail banning “all-or-nothing clauses,” which require an insurer that wants to contract with a particular provider in a system to contract with all providers in that system. ↩︎

A new KFF survey reveals the broad reach of health misinformation, with at least four in 10 people saying that they’ve heard each of 10 specific false claims about COVID-19, reproductive health, and gun violence.

Relatively small shares say that each of those false claims are “definitely true”, ranging from as few as 3% who definitively believe that COVID-19 vaccines have been proven to cause infertility to as many as 18% who definitively believe armed school guards have been proven to prevent school shootings.  

At the same time, roughly half to three-quarters of the public are uncertain whether each of the 10 false claims are true or not, describing them as either “probably true” or “probably false.” This suggests that even when people don’t believe false claims they hear, it can create uncertainty about complicated public health topics.

“Most people aren’t true believers in the lies or the facts about health issues; they are in a muddled middle,” KFF President and CEO Drew Altman said. “The public’s uncertainty leaves them vulnerable to misinformation but is also the opportunity to combat it.”

The new survey is one component of a new KFF program area aimed at identifying and monitoring health misinformation and trust in the United States, placing particular emphasis on communities that are most adversely affected by misinformation, such as people of color, immigrants and rural communities. 

Alongside today’s survey findings, KFF will soon release companion survey reports highlighting the extent of health misinformation among Black and Hispanic adults, as well as rural residents. KFF will also soon release a regular “Health Misinformation Monitor,” which will document emerging health misinformation, identify its primary sources, and examine the role that social media and news outlets play in its spread. Sign up for alerts from KFF on this topic. KFF Health News is also expanding its reporting on this topic in conjunction with the new program. 

“While many Americans struggle to separate health information fact from fiction, our survey shows that credible sources of information, and messengers, represent an opportunity to break through and help increase trust,” said Irving Washington, senior fellow for misinformation and trust at KFF. “We’ll continue to focus on this opportunity and what type of efforts can make a difference.”The misinformation examined in the survey includes: 

• Vaccines. A third (34%) of adults say the false claim that COVID-19 vaccines have caused thousands of sudden deaths in otherwise healthy people is definitely (10%) or probably (23%) true. Black adults are more likely to believe this false statement than White adults, while Republicans and independents are more likely than Democrats to do so. People with college degrees are less likely than those with a high-school education or less to say this is true.
• Reproductive health. About a third of adults say the false claim that using birth control such as the pill or an IUD makes it harder for most women to get pregnant once they stop using them is “definitely” (5%) or “probably” true (29%). Adults under the age of 65, Republicans, independents, and Black and Hispanic adults are more likely to say this claim is true than their counterparts.
• Gun violence. When asked about the inaccurate statement that people who have firearms at home are less likely to be killed with a gun, about four in ten (42%) say it is “definitely” (13%) or “probably” (29%) true. Gun owners are more likely than non-gun owners to say that this false claim is definitely or probably true (55% vs. 37%).

The survey also reveals how varied people’s beliefs and perceptions are about what constitutes misinformation. For example, when asked to describe specific misinformation related to COVID-19 that they’ve heard, people volunteered statements that were in direct contradiction with one another, including about the safety and effectiveness of COVID-19 vaccines and of wearing masks to prevent the virus’ spread.

Who People Trust for Health Information

The survey also gauges people’s trust in various sources of health information:

• Doctors. Not surprisingly, people overwhelmingly say that they trust their own doctor’s recommendations – with 93% saying they trust their doctors at least a fair amount.
• Federal agencies. About two thirds of the public say they have at least a fair amount of trust in the Centers for Disease Control (67%) and the Food and Drug Administration (65%) to make the right recommendations when it comes to health issues. Democrats are more likely than either independents or Republicans to trust the two federal agencies. About half of Republicans say they trust both the CDC (49%) and FDA (54%).
• Traditional news sources. The largest shares of the public say they would have at least a little trust in health information reported by their local TV news stations (80%), national network news (72%), and their local newspaper (72%). CNN is the most trusted cable news network (58%), with smaller shares trusting MSNBC (52%), Fox News (49%), Newsmax (25%) or One American News Network (22%). Fewer than three in ten adults say they have “a lot” of trust in health information from any of these media sources.
• Social media sources. About a quarter (24%) of adults say that they use social media at least weekly to find health information or advice, including larger shares of Hispanic and Black adults, and people in low-income households. Of eight specific social media sources, half (52%) would trust information about health issues they saw on YouTube at least a little. Fewer say they would trust health information if they saw it on Facebook (40%), Twitter (29%), Instagram (27%), and other platforms. Fewer than one in ten say they have a lot of trust in health information from any of these social media sources.

The survey report examines the sources to which people go to get their news and their susceptibility to misinformation. Less than half (45%) of adults say they have heard one of the five false COVID-19 and vaccine claims and believe it is definitely or probably true. That share rises to 76% of regular Newsmax viewers, and 67% of regular OANN viewers, and 61% of regular Fox News viewers.Similarly, 54% of those who use social media for health information and advice at least weekly say they have heard at least one of the false COVID-19 and vaccine claims and think it is definitely or probably true, compared to 40% of those who don’t use social media for health advice.Designed and analyzed by public opinion researchers at KFF, the KFF Health Misinformation Tracking Poll Pilot was conducted May 23-June 12, 2023, online and by telephone among a representative sample of 2,007 U.S. adults. Interviews were conducted in English and in Spanish. The margin of sampling error is plus or minus 3 percentage points for the full sample. For results based on subgroups, the margin of sampling error may be higher. Support for this work was provided by the Robert Wood Johnson Foundation (RWJF). The views expressed do not necessarily reflect the views of RWJF. KFF maintains full editorial control over all of its policy analysis, polling, and journalism activities.

Obesity in children is caused by a multitude of socioecological, environmental, and genetic factors and has increased in recent decades, with child obesity rates now three times higher than they were in the 1970s. Obesity is a risk factor for many chronic diseases and has been linked to future physical and mental health challenges and increased health care costs. Though obesity has historically been stigmatized as a result of personal choices, there have been recent actions to reduce that stigma and weight bias and increase obesity screening and treatment options. New FDA weight-loss drugs have entered the market, and the American Academy of Pediatrics (AAP) released a new set of clinical practice guidelines for evaluating and treating obesity in early 2023. While addressing obesity among children with all forms of insurance coverage is important, Medicaid is particularly relevant since it now covers half of children in the U.S., including 8 in 10 children living in poverty and over half of Black, Hispanic, and American Indian/Alaska Native children. Obesity prevalence is higher for these groups. This brief examines the share of children with obesity, how obesity screening and treatment is covered under Medicaid for children, and what recent changes may mean for Medicaid programs and enrollees in the future.

What is the share of children with obesity?

KFF analysis of federal survey data show more than one in six children have obesity, with obesity rates varying by insurance coverage type, race and ethnicity, and household income. Based on data from the 2020-2021 National Survey of Children’s Health (NSCH), 17% of children ages 10-17 in the U.S. have obesity (Figure 1). Obesity in children is typically defined as having a Body Mass Index (BMI) equal to or greater than the 95th percentile for their age and sex, although there has been recent pushback on BMI as a screening tool, and research has shown it can incorrectly classify individuals as overweight or obese, especially for people of color. Children with Medicaid are more than two times as likely to have obesity than those with private insurance: Over one-quarter (26.0%) of Medicaid children have obesity compared with 11.4% of children with private insurance alone. Obesity prevalence is also higher for Black, Hispanic, and children of other or multiple races compared with White children as well as for children with lower household incomes compared with children in the highest income households (Figure 1). These disparities in obesity reflect a variety of factors, including social and economic factors such as higher rates of food insecurity, more limited access to healthy food options, more limited time and access to opportunities for physical activity and recreation, and experiences with discrimination and stigma.

What other chronic conditions do Medicaid children with obesity have?

Children’s obesity rates in Medicaid claims data are lower than survey estimates of obesity prevalence. In 2019, 7.4% of Medicaid children ages 10-17 had an obesity diagnosis clinically identified in the Medicaid claims data (T-MSIS), suggesting that obesity in children may be undertreated. Other research has found that obesity is generally under-reported in claims data, and when it is reported, it is more likely to identify individuals with morbid obesity or comorbidities than individuals with more moderate obesity. Several factors could be contributing to low rates of reporting including the relative newness in viewing obesity as a disease, interventions being time intensive and difficult for clinicians to implement in a time limited primary care visit, or limited provider reimbursement for obesity treatment services. While there are limitations, analysis of claims data can help to identify the extent to which other chronic health conditions accompany obesity.

For Medicaid children ages 10-17 with an obesity diagnosis, the most common co-occurring chronic condition (across a set of 30 chronic conditions, see Methods for more information) is asthma, followed by certain mental health conditions, hyperlipidemia, anemia, hypertension, and diabetes (Figure 2). Children with obesity are also more likely to have these conditions compared with children without an obesity diagnosis. For example, 13.2% of children with an obesity diagnosis also have an asthma diagnosis compared with 7.3% of children without obesity. Similarly, 12.4% of children with an obesity diagnosis also experience mental health challenges including depression, bipolar disorder, and other depressive mood disorders compared with 7.6% of children without obesity. These findings mirror a body of research that has found a link between childhood obesity and asthma as well as various mental health challenges including depression and anxiety, lower self-esteem and increased bullying. One recent study of Medicaid expenditures also found inpatient and outpatient mental health services were a primary driver of spending among children with obesity. Overall, over one-third (35.6%) of children with an obesity diagnosis have at least one other co-occurring chronic condition (across a set of 30 chronic conditions). 

What obesity treatment and services does Medicaid cover for children?

Obesity services can include screening, behavioral and nutritional counseling, anti-obesity medications, and bariatric surgery, and these services are covered for children under Medicaid’s Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) program. EPSDT is a Medicaid benefit for children under 21 that provides comprehensive treatment and preventive care. Under EPSDT, states are required to cover all screening services for children as well as any services “necessary… to correct or ameliorate” a child’s physical or mental health condition. EPSDT also allows for unique state flexibility in addressing the range of other factors connected to obesity, including providing behavioral health services and addressing adverse childhood experiences (ACEs) and social determinants of health (SDOH) such as housing, finances, and safety.

While children have access to obesity treatment though EPSDT, it is less clear how states are implementing and covering these services in practice. One old study, from 2010, only found conclusive evidence from 10 states that they were covering obesity-related behavioral and nutritional counseling services. While additional states are likely to have started covering obesity-related services since then, other research has found that some Medicaid-covered children do not receive recommended EPSDT screenings and services. Data from the 2020 Child Core Set, which includes data from participating states on children in Medicaid or the Children’s Health Insurance Program (CHIP), found a median of 73% of children ages 3 to 17 with a primary care visit had evidence of BMI screening, 63% received nutrition counseling, and 59% received physical activity counseling though these rates varied across states.

What to watch looking ahead?

While data indicate a majority of Medicaid children are being screened for obesity, it is difficult to know how many children are receiving recommended services. Research also indicates there are racial disparities in access to obesity treatments. When the Child Core Set quality measures—which include measures related to obesity— become mandatory in 2024, states and health plans will have data on rates of screening and counseling for obesity. Access to such data may prompt the states and health plans to encourage more proactive screening and treatment by pediatricians. Provisions included in recent legislation to bolster Medicaid’s EPSDT benefit may also help more Medicaid-covered children receive all recommended screenings and services, including obesity screening and counseling.

The AAP released a new set of clinical practice guidelines for evaluating and treating obesity and associated conditions in early 2023. The guidelines outline and describe evidence-based screening procedures, comorbidity evaluation and treatment for children ages 2 and older, and recommended obesity treatments (for treatment details, see Table 1). The guidelines emphasize early and intensive treatment, and note the importance of a non-stigmatized, family-centered approach that takes the range of factors that cause obesity into account. The guidelines are not mandatory, and it remains to be seen how quickly and to what extent the guidelines will be adopted by clinicians. There has been some pushback on the intensity of the new guidelines and the potential to cause eating disorders. Concerns with new medications for weight loss include some side effects and studies show people regain the weight if they stop taking the medications. Despite increasing prescribing rates of medications for adults, it is expected that providers may be slower to prescribe children anti-obesity medications .

With Medicaid now covering half of all children in the U.S., and an even larger percentage of children who are likely to be obese, changes in physicians’ practice stemming from the updated treatment recommendations could have a sizable effect on Medicaid programs and enrollees. However, the extent to which the new, more intensive treatment recommendations are considered medically necessary for children may vary by state and provider. While there is evidence that payment rates for obesity treatment, access to IHBLT, and take up of anti-obesity medications is currently limited, there could also be spending implications for Medicaid if more children begin to receive recommended obesity treatments including anti-obesity medications or bariatric surgery.