Modern Era Medicaid: Findings from a 50-State Survey of Eligibility, Enrollment, Renewal, and Cost-Sharing Policies in Medicaid and CHIP as of January 2015
Taken together, these findings show that, one year into implementation, the ACA has accelerated meaningful transformation of the Medicaid program, broadening it as a base of coverage for the low-income population and leading to substantial modernization of its enrollment processes and systems. There have been significant increases in eligibility levels for low-income adults in states that expanded Medicaid, but eligibility levels remain low in states that have not expanded, resulting in gaps in coverage. Medicaid and CHIP coverage for children and pregnant women remains strong across states. On the operational and systems side, many states have achieved notable progress toward realizing the ACA’s vision of a streamlined, technology-driven enrollment system, but work continues in many areas.
Looking ahead to 2015, state and federal officials will continue efforts to refine Medicaid and CHIP procedures and systems to move closer toward the ACA’s vision of a real-time, data-driven eligibility and enrollment experience. Enhancing information technology systems, implementing streamlined renewal processes, and improving coordination between Medicaid and the Marketplaces will be among the top priorities going forward. At the same time, other changes in Medicaid and the broader health care system, such as delivery and payment system reforms, CHIP reauthorization, and continued action related to the ACA, including the Supreme Court’s consideration of King v. Burwell regarding the provision of premium tax credits in FFM states, all have important implications for coverage. Following are key issues to consider looking ahead to 2015.
The Medicaid expansion to low-income adults will likely lead to continued gains in enrollment. Newly tracked Medicaid and CHIP eligibility and enrollment performance metric data released monthly by CMS show large gains in Medicaid enrollment across states since the initial open enrollment period for the Marketplaces began in October 2013.1 The data show that Medicaid expansion states have experienced significantly greater enrollment gains than states that have not yet expanded. However, there have been gains across nearly all states, reflecting increased enrollment among both adults made newly eligible by the expansion as well as individuals who were previously eligible but not enrolled who were reached through outreach and enrollment efforts. Emerging data also suggest that these gains in Medicaid enrollment are leading to reductions in the number of uninsured. Although data from the large federal population-based surveys are not yet available to measure changes in uninsured rates, several recent private surveys have consistently shown corresponding reductions in the uninsured rate since implementation of the ACA, and one study found that the uninsured rate dropped by 4 percentage points in expansion states, compared to 1.4 percentage points in non-expansion states.2 However, gaps in coverage remain in the 23 states that have not expanded Medicaid, leaving nearly four million poor adults without access to an affordable health coverage option. Moreover, continued progress in adopting streamlined renewal procedures will be important for preventing potential coverage losses or gaps over time.
Additional states may move forward with the Medicaid expansion. There is no deadline by which states must decide to implement the Medicaid expansion to low-income adults and debate continues in several states. However, the 100 percent federal financing for newly eligible individuals begins to phase down after 2016 to 90 percent by 2020. To date, a limited number of states have obtained or are seeking approval through Section 1115 waivers to implement the expansion in ways that extend beyond the flexibility provided by the law. Looking ahead, more states may pursue alternative models through waivers to extend coverage with federal dollars. These waivers are intended to be research and demonstration projects, and, as such, it will be important to evaluate their impacts to provide greater insight into serving Medicaid’s low-income beneficiaries. What happens with Medicaid waivers between 2014 and 2016 also will be important to inform the use of the new state innovation waiver authority available in 2017, which will allow states waive certain Marketplace provisions and may be combined with Medicaid waivers to implement state-specific health reform approaches.
As of 2015, states may also expand coverage through a new option established by the ACA, the Basic Health Program (BHP). In March 2014, CMS published final regulations that describe how states can provide coverage through a BHP for individuals who do not qualify for Medicaid or CHIP but have income under 200 percent of the FPL. This option allows states to finance a state-run program with 95 percent of the federal funding these enrollees would receive for premium tax credits and cost-sharing reductions. As noted, Minnesota became the first state to implement a BHP and converted existing Medicaid coverage for enrollees with incomes between 138 and 200 percent of the FPL to a BHP. In addition, New York has indicated plans to pursue a BHP.
States will continue work to advance enrollment and renewal processes and enhance their system functionality, supported by ongoing 90 percent federal funding for Medicaid eligibility and enrollment systems. High-performing eligibility and enrollment systems are central to moving toward a paperless process for determining eligibility for new applicants and keeping eligible enrollees covered at renewal. While challenges exist to achieving real-time, data-driven eligibility determinations, the shift from paper documentation to electronic sources will improve over time as states use the enhanced federal funds to harness technology and secure access to more data sources. Moreover, the funding will help support continued system enhancement to move states closer toward the automated, electronic data-driven renewal processes called for in the ACA, as states work to resolve challenges transitioning to new renewal processes and phase out mitigation strategies. Similarly, continued work will be important for ensuring smooth account transfers between Medicaid and Marketplaces to assure “no wrong door” access to coverage and prevent delays in enrollment. In addition, the three-year extension of flexibility to charge other public benefits programs only the added cost of consolidating eligibility determinations into the new Medicaid systems will support state efforts to phase-in integration of other programs.
Lastly, 2015 will be a pivotal year for children’s health coverage as CHIP funding will not extend beyond September 2015 without congressional action. Together, CHIP and Medicaid have led the way to historically high levels of coverage for children. When CHIP was enacted, it spurred improvements in children’s coverage, which have served as a catalyst for many of the innovations in streamlining eligibility and enrollment that were adopted by the ACA. The future of CHIP will have important implications for children’s coverage. As debates over extended funding for CHIP advances, it will be important to consider barriers to coverage as well as differences in coverage between CHIP and the Marketplace to understand the implications of CHIP funding decisions.
The authors extend our sincere appreciation to the many state officials who generously shared their time and expertise with us to participate in this survey and help us to understand the nuances of their programs. This report would not be possible without them, and we greatly value their contributions during such a busy time. We also extend our thanks to Martha Heberlein, formerly with the Georgetown University Center for Children and Families, for her work on this report.