Coverage You Can Count On
Make Medicaid Coverage We Can Count On
Medicaid and CHIP are lifelines for tens of millions of low-income, aging, or disabled Americans, providing health care coverage when they need it most. Still, these important programs can be improved to ensure that Medicaid and CHIP provide coverage that all enrollees can count on.
Enrollment in Medicaid and CHIP has been compared to a “leaky sieve.” Unlike in private insurance and Medicare, every year millions of people enroll only to subsequently lose coverage due to lost paperwork, incorrect phone numbers, or minor and temporary changes in income. These interruptions in coverage, known as eligibility “churn,” undermine access and hurt the continuity and effectiveness of the care these Americans receive.
Continuous eligibility in Medicaid and CHIP has the potential to provide millions of families with reliable access to health care and increased financial stability. Unfortunately, continuous eligibility is not yet consistently applied by all states and for all covered populations. For example, while states can provide continuous eligibility to children in Medicaid and CHIP, more than one-third have not yet chosen to do so.[i]
In recent years, however, we have witnessed an uptick in interest in this common-sense policy.
Early in the COVID-19 pandemic, Congress passed the Families First Coronavirus Response Act (H.R.6201). This law requires all states receiving enhanced Medicaid funding to provide continuous Medicaid coverage to all enrollees. As a result, eligibility churn in Medicaid has been brought to a temporary halt, providing security to tens of millions of people.
Passed by the House of Representatives during the 116th Congress, the Patient Protection and Affordable Care Enhancement Act (H.R.1425) included a requirement for states to provide 12-month continuous eligibility in both Medicaid and CHIP. (The Senate did not vote on this legislation.)
In its March 2021 Report to Congress, the Medicaid and CHIP Payment Access Commission (MACPAC) urged Congress to extend Medicaid coverage to postpartum mothers for a full year, regardless of income changes.
The 117th Congress delivered: with enactment of the American Rescue Plan (ARP) Act (H.R. 1319), an expansive COVID-19 relief package, Congress gave states the option to extend continuous coverage to Medicaid and CHIP pregnant enrollees through one full year after the birth of a child. This legislation was originally introduced in the 116th Congress as the Helping Medicaid Offer Maternity Services Act of 2020 (H.R. 4996).
Each of these important legislative steps move the country closer to extending continuous eligibility to all Medicaid and CHIP nationwide.
Stabilize Coverage in Medicaid and CHIP
The Stabilize Medicaid and CHIP Coverage Act of 2021 was introduced in both the House and Senate in early 2021. Representatives Debbie Dingell (D-MI) and John Katko (R-NY) introduced the bipartisan H.R. 1738. Senator Sherrod Brown introduced S. 646 with original cosponsors Senator Tammy Baldwin (D-WI), Senator Elizabeth Warren (D-MA) and Senator Sheldon Whitehouse (D-RI).
When enacted, these bills will require 12-month continuous eligibility in every state for all Medicaid and CHIP enrollees.
Urge your Member of Congress to support this important legislation. Read on for more background.
What is Medicaid “churn”?
Americans become eligible for Medicaid when their incomes fall below a certain level or if they are members of certain eligibility groups, such as pregnant women or people who are aged, blind, or disabled. Prior to the maintenance of effort provision enacted in the Families First Coronavirus Response Act (FFCRA) in 2020, the average Medicaid enrollee was covered for less than 10 months per year. [ii] Sometimes, people disenroll from Medicaid after gaining employer-sponsored or Marketplace coverage. In many cases, however, people are kicked off the program because of eligibility “churn” — a loss of coverage because of lost or confusing paperwork or slight and short-term increases in income due to overtime pay or working a few extra hours. Losing coverage in these ways is fundamentally unfair and may create disincentives to earning extra money.[iii]
Medicaid enrollment “churn” also affects dually-eligible enrollees—people who receive both Medicaid and Medicare benefits. Almost thirty percent of new full-benefit dually-eligible enrollees from 2007 – 2009 lost coverage for at least 1 month during the year immediately after their transition to a fully dual-eligible status. For these enrollees, losing full full-benefit Medicaid coverage poses a problem as most lack another source of health insurance to cover for those services. Without Medicaid coverage, many of these enrollees experience hardship paying for cost-sharing of Medicare services and lack the ability to access services not covered by Medicare, such as long-term services and supports. [iv]
How would the Stabilize Medicaid and CHIP Coverage Act fix “churn”?
By providing 12 months of continuous eligibility in Medicaid and CHIP, the Stabilize Medicaid and CHIP Coverage Act will reduce the number of low-income Americans who lack health insurance coverage and improve the stability, continuity, and quality of care they receive. When enacted, this legislation will prevent loss of coverage due to bureaucratic snafus or small amounts of temporary, extra earnings. Health plans and providers in the Medicaid program will also be able to improve continuity of care – particularly important for people with complex chronic illnesses or substance use disorders. Stable coverage will also help quality improvement organizations thoroughly evaluate the quality of coverage and care provided by Medicaid programs, health plans, and providers, giving taxpayers a better understanding of what they are paying for.
In short, the Stabilize Medicaid and CHIP Coverage Act will ensure that Medicaid and CHIP, which together provide coverage to over 1 in every 5 Americans, is health care coverage they can count on.[v]
For more information about how unstable coverage affects the millions of Americans who rely on Medicaid and CHIP, review the churn FAQs.
Letters of support from organizations representing health plans, doctors, hospitals, and patient advocates are available here.
[i] Brooks, T., Wagnerman, K., et al. (Jan 2017). Medicaid and CHIP Eligibility, Enrollment, Renewal, and Cost Sharing Policies as of January 2017: Findings from a 50-State Survey. Kaiser Family Foundation. Table 14: Express Lane Eligibility and 12-Month Continuous Eligibility for Children, January 2017.
[ii] Leighton Ku, PhD, MPH, Erika Steinmetz, MBA, and Tyler Bysshe, MPH (Nov 2015). Continuity of Medicaid Coverage in an Era of Transition. George Washington University.
[iv] Office of the Assistant Secretary for Planning and Evaluation. (May 2019). Loss of Medicare-Medicaid Dual Eligible Status: Frequency, Contributing Factors and Factors.