The Treacherous Transition Awaiting Millions Losing Their Medicaid
March 30, 2023
We dig into three research papers to make sense of what will happen to 15 million people set to lose their Medicaid over the next year.
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Researchers estimate 15 million people will lose their Medicaid starting April 1 when states begin removing people from the low-income health insurance program for the first time in three years.
In March 2020, Congress banned states from removing people from Medicaid during the pandemic in exchange for more federal funding for state Medicaid programs. Medicaid enrollment is usually tied to people’s incomes, and individuals normally have to regularly prove they still qualify in what’s known as a redetermination. (In the 39 states and Washington, D.C., that have expanded Medicaid, a family of four has to make less than $40,000 to qualify. In non-expansion states, the cutoff is even lower.)
With redeterminations paused, Medicaid enrollment nationwide has grown from 71 million in February 2020 to an estimated 95 million in March 2023. Research shows Medicaid coverage is associated with better access to care, more financial security, better health and lower mortality. During the pandemic, beneficiaries have been able to enjoy these benefits without worrying about confirming their eligibility.
In December, Congress voted to let states restart the process of clearing their rolls on April 1, what’s sometimes referred to as “unwinding.” Lawmakers are giving states 14 months to redetermine millions of people’s eligibility — an unprecedented task made even more difficult by serious staffing and experience shortages in many Medicaid offices.
“It’s going to be a big lift,” said Sayeh Nikpay, a health policy researcher at the University of Minnesota and Tradeoffs Senior Research Advisor. “States have never had to do this many redeterminations this quickly before, and there’s a lot of uncertainty about what will happen.”
We asked Nikpay to pick out a few relevant studies to help us understand what is happening and how states and employers could keep more people insured. Here are three she identified as particularly helpful.
Two types of people will lose coverage
The Office of the Assistant Secretary for Planning and Evaluation, which provides research for the U.S. Department of Health and Human Services, released a report in August 2022 that estimated 15 million people will lose Medicaid coverage as a result of the unwinding. (The estimate is similar to another analysis by the independent Urban Institute.)
ASPE breaks those 15 million people into two groups. In the first group are people who make too much money to qualify for Medicaid. ASPE estimates there are about 8 million people in that category, and they should be able to get insurance through work or the Obamacare exchanges.
In the second group are roughly 7 million people ASPE estimates are still eligible but will lose coverage because of what’s called “administrative churn.” This can happen if the Medicaid office can’t get in touch with someone to confirm their eligibility because they’ve moved or changed their phone number or if they’re unable to make an in-person appointment because of work or child care responsibilities. (The Urban Institute projects about 4 million people will be in this group.)
These two groups represent a key tension to the unwinding process: States want to shed people who make too much money, but officials also know eligible people often lose coverage during redeterminations, and that danger is heightened given the scale and speed of this process.
Making the switch from Medicaid to private insurance
This next paper looks at the first group: the roughly 8 million people expected to move from Medicaid to private coverage, and specifically the roughly 4 million who are expected to get coverage through the Obamacare exchanges. Adrianna McIntyre, an assistant professor of health policy at Harvard, wrote in JAMA Health Forum in October 2022 about the most effective ways to move people from Medicaid onto private Obamacare plans.
There’s limited data on this, but based on the few studies available, McIntyre found that only 3 to 5 percent of people who leave Medicaid end up getting an Obamacare plan. Many policymakers are relying on the Obamacare exchanges to provide a life preserver to millions of people losing Medicaid coverage, but the research cited by McIntyre shows getting people into these plans is not guaranteed and will take focused effort by states.
McIntyre’s review cites several randomized controlled trials where states tested different ways of increasing enrollment in Obamacare plans. These studies found simple reminders from the state – like physical letters, emails and phone calls help – boost sign-ups anywhere from 7 to 16 percent.
But what really seems to make a difference is reminders plus connecting people to someone who can get them signed up while they are on the phone. In one of those trials published in 2022, people in California who got a reminder email and a call connecting them to enrollment assistance were almost 50% more likely to sign up for a plan. Such extra effort is obviously costly, and it may not be a priority or financially feasible for some states.
McIntyre’s review did not include any research on what employers can do to help their workers transition from Medicaid to work-based coverage, but based on the studies McIntyre cited, Nikpay said she thinks it’s a good idea for employers to make sure people know Medicaid could be going away and provide as much help as possible in getting new coverage.
Making it easier to stay on Medicaid can have other benefits
The final study looks at the second group of people expected to lose Medicaid coverage: the 7 million people who may lose coverage due to administrative churn even though they are still eligible.
Some states have tried to limit that churn, and researchers at the RAND Corporation evaluated New York’s effort. Starting in 2014, New York allowed people to stay on Medicaid without any redeterminations for 12 months once enrolled.
In addition to keeping more people on Medicaid for longer, researchers found that after this policy was in place, hospital admissions and monthly costs per beneficiary went down. The researchers can’t say whether the continuous enrollment policy directly caused these improved outcomes, but the findings suggest that avoiding administrative churn can help people stay covered without ballooning costs.
“It seems reasonable to me,” Nikpay said of the findings, “that making it easier to stay on Medicaid, even outside of a global pandemic, could benefit people’s health given what we know about how Medicaid affects people.”
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Research Cited in the Episode:
Unwinding the Medicaid Continuous Enrollment Provision: Projected Enrollment Effects and Policy Approaches (Office of the Assistant Secretary for Planning and Evaluation, 8/19/2022)
The Impact of the COVID-19 Public Health Emergency Expiration on All Types of Health Coverage (Matthew Buettgens and Andrew Green, Urban Institute, 12/5/2022)
Unwinding the Continuous Enrollment Provision: Perspectives from Current Medicaid Enrollees (Jennifer Tolbert, Robin Rudowitz and Meghana Ammula; KFF; 3/9/2023)
Update: Awareness of the Resumption of Medicaid Renewal Processes Remained Low in December 2022 (Jennifer M. Haley, Genevieve M. Kenney, Stephen Zuckerman, Michael Karpman, and Dulce Gonzalez; Urban Institute; 2/15/2023)
Evidence-Based Outreach Strategies for Minimizing Coverage Loss During Unwinding (Adrianna McIntyre, JAMA Health Forum, 10/14/2022)
New York State 1115 Demonstration Independent Evaluation Interim Report (Harry H. Liu, Andrew W. Dick, Nabeel Qureshi, Sangita M. Baxi, Katherine J. Roberts, J. Scott Ashwood, Laura A. Guerra, Teague Ruder and Regina A. Shih; RAND Corporation; 2021)
Additional Research and Reporting on Medicaid Unwinding:
Medicaid and CHIP Eligibility, Enrollment, and Renewal Policies as States Prepare for the Unwinding of the Pandemic-Era Continuous Enrollment Provision (Tricia Brooks, Allexa Gardner, Peyton Yee, Jennifer Tolbert, Bradley Corallo, Sophia Moreno and Meghana Ammula; KFF and Georgetown University Center for Children and Families; 3/16/2023)
Google plans to boost Medicaid information during redeterminations (Rebecca Pifer, Healthcare Dive, 3/15/2023)
The Long Unwinding Road: States Prepare for the End of the Medicaid Continuous Coverage Requirement (Gia Gould and Anita Cardwell, NASHP, 3/13/2023)
Idaho Dropped Thousands From Medicaid in the Pandemic’s First Years (Rachana Pradhan, Kaiser Health News, 3/1/2023)
Why one state’s plan to unwind a Covid-era Medicaid rule is raising red flags (Megan Messerly, Politico, 2/27/2023)
Striking a Balance During Medicaid’s Unwinding (Kate McEvoy, National Association of Medicaid Directors, 2/23/2023)
10 Things to Know About the Unwinding of the Medicaid Continuous Enrollment Provision (Jennifer Tolbert and Meghana Ammula, KFF, 2/22/2023)
Millions of people are about to get kicked off Medicaid (Dylan Scott, Vox, 2/13/23)
As Pandemic-Era Medicaid Provisions Lapse, Millions Approach a Coverage Cliff (Phil Galewitz, Kaiser Health News, 2/2/2023)
Unwinding Medicaid’s Continuous Coverage Requirement: State Communication Strategies (Leah Wilson, NASHP, 9/8/2022)
Sayeh Nikpay, PhD, Tradeoffs Senior Research Advisor; Associate Professor of Health Policy and Management, University of Minnesota
The Tradeoffs theme song was composed by Ty Citerman, with additional music this episode by Blue Dot Sessions and Epidemic Sound.
This episode was produced by Ryan Levi and mixed by Andrew Parrella and Cedric Wilson. Editing assistance from Cate Cahan.