Remember when there wasn’t a pandemic? COVID-19 has rocked our world and has left its mark on a new generation. It has also shape-shifted the Medicaid program. States will need to figure out how to return Medicaid to the pre-COVID-19 program it was. What does that mean for payors, providers, and beneficiaries? This article takes a look at Medicaid before, during and after the COVID-19 Public Health Emergency (PHE) to increase your understanding and help you sleep better at night.
Medicaid is a voluntary program for states. All 50 of the United States plus the District of Columbia have chosen to participate in Medicaid. The federal government shares the expense of each state’s Medicaid program on a percentage basis through what is called the Federal Medical Assistance Percentage (FMAP). There is an established FMAP for each state.
State Medicaid programs are held to federal standards when it comes to eligibility processing. State-based exceptions may apply, but generally the following holds true:
- Applications: A state has 45 days to determine an applicant’s eligibility for a family-related Medicaid program or 90 days for a disability-related program.
- Verifications: The caseworker verifies eligibility, either electronically or by requesting supporting documentation.
- Redeterminations: Once eligible, a Medicaid beneficiary typically has 10 days to report a change in circumstances after which the caseworker completes a redetermination of eligibility.
- Renewals: An eligibility review is required on an annual basis.
If a Medicaid beneficiary becomes ineligible, states are required to review eligibility for all applicable Medicaid programs before discontinuing coverage. Medicaid beneficiaries typically go on and off the program, and in and out of state managed care programs. This is called churn.
Public Health Emergency (PHE)
The COVID-19 pandemic has lived through two Presidential administrations, Donald Trump and Joe Biden. The United States Department of Health and Human Services (HHS) former Secretary Alex Azar first declared a PHE effective January 27, 2020. The current HHS Secretary Xavier Becerra recently renewed the PHE through approximately October 20, 2021.
The declaration of a PHE allows states flexibility they would not otherwise have. The Medicaid eligibility verification process, for example, may allow for self-attestation in lieu of supporting documentation if information cannot be secured electronically.
FMAP and Continuous Medicaid Eligibility
The Families First Coronavirus Response Act (FFCRA), a stimulus package, was passed into law on March 18, 2020. Section 6008 of the FFCRA, amended by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, increased a state’s FMAP by 6.2 percentage points if a state maintains “continuous eligibility” for their Medicaid beneficiaries, until the end of the month in which the PHE expires. All 50 states and the District of Columbia have agreed to the continuous eligibility provision.
With few exceptions, Medicaid beneficiaries are remaining enrolled in the program, even if a change in circumstances has made them ineligible. Redeterminations and renewals have halted in many states.
As of March 2021, total Medicaid/CHIP enrollment grew to 81.7 million, an increase of 10.5 million (14.7%) from enrollment in February 2020. Churn has all but ceased. Providers are seeing less uninsured, and Medicaid managed care rosters have increased.
Public Health Emergency (PHE)
President Biden has stated he plans to renew the PHE through the end of the year and give states 60-days’ notice before the end of the final renewal period. The PHE is renewed in 90-day increments so the “end of the year” would take us through roughly January 20, 2022. Continuous eligibility, then, could cease effective January 31, 2022.
The Centers for Medicare and Medicaid Services (CMS), under the Trump Administration, issued State Health Official (SHO) letter SHO #20-004 on December 22, 2020 to guide states in resuming normal operations after the PHE ends. Page 22 notes four key areas of eligibility and enrollment actions states will need to address: 1) processing applications, 2) completing verifications for individuals enrolled based on self-attested information, 3) acting on changes in circumstances, and 4) completing renewals.
The Biden Administration issued SHO #21-002 on August 13, 2021, updating the original guidance in two key areas:
- Extends the timeframe from 6 to 12 months for states to complete verifications, redeterminations and renewals, and
- Requires states to complete a redetermination of eligibility after the PHE for all beneficiaries prior to taking any adverse action.
The 6.2 percentage point FMAP increase expires at the end of the calendar quarter in which the PHE ends. If the PHE ends roughly January 20, 2022, the end of the calendar quarter would be March 31, 2022. States will be faced with ineligible Medicaid beneficiaries on their rosters that they are no longer receiving extra money for, although the regular FMAP will apply.
SHO #20-004 asks states to adopt one of four risk-based approaches to prioritize actions for Medicaid beneficiaries who are most likely no longer eligible for coverage. States have 12 months to reprocess their eligibility. Additionally, any beneficiary losing coverage must be reviewed for other programs including, but not limited to, electronic referral to the Marketplace. This will help to prevent a “renewal bulge” by evening out future annual renewals, ease the administrative burden on states and beneficiaries, and minimize churn.
There will be loss of coverage for Medicaid beneficiaries. Providers will see an uptick in the uninsured and Medicaid managed care plans will lose members. Centauri Health Solutions has 37 years of experience with Medicaid eligibility and stands by ready, willing, and able to help you minimize the impacts. Give us a call today.
Shanna Hanson, FHFMA, ACB
Manager, Business Knowledge
Centauri Health Solutions, Inc.