Major Medicaid changes loom when federal public health emergency ends

The termination of the emergency will start a major shift in how the state of Montana reviews who is qualified for health insurance coverage through most adult Medicaid programs. That process, called redetermination, has been on hold in states across the country during COVID-19 in an effort by the federal government to make sure people could access health care during the pandemic.

“We have heard national organizations and other states say this is going to be the biggest transition in coverage since the Affordable Care Act was rolled out,” said Olivia Riutta, the outreach and engagement manager of the Montana Primary Care Association. “This is a lot of Montanans who are potentially going to shift how they get their health insurance.”

Amid a lull in COVID-19 cases nationally, the state of emergency is set to expire April 15. The federal government has indicated it will issue another extension that could come with a 60-day notice signaling the end of the emergency.

The policy that will end when the emergency does is called 12-month continuous eligibility. It means that when someone is qualified for coverage under Medicaid, they remain so for a year. Before the pandemic just four states provided some sort of 12-month continuous eligibility for adults covered by Medicaid, according to a report from the Kaiser Family Foundation. But it was a distinctive feature of Montana’s Medicaid expansion program that extends traditional Medicaid coverage to adults earning up to 133% of the federal poverty level.

Last year, however, the GOP-majority state Legislature passed a budget that the state health department said directed it to end continuous eligibility on the Medicaid expansion program.

That was done by budgeting for a higher reimbursement rate. The state is paid back 89% for services provided to expansion patients, but that would increase to 90% if continuous eligibility was eliminated; that bump was reflected in the state budget.

In December, the federal government approved Montana’s application to end continuous eligibility for those covered under Medicaid expansion, once the federal health emergency ends.

Though the state had previously applied to end continuous eligibly for another segment of Medicaid that covers parents or caretakers and adults with severe disabling mental illness, only the change to the parent/caretaker population was approved by the federal Centers for Medicare and Medicaid. That will take effect when the public heath emergency ends too.

Projected changes

With the looming end of continuous eligibility for those covered under Medicaid expansion because of legislative action and the federal government lifting protections for most other adults on Medicaid, Montanans who are insured through those programs will need to be able to respond in a timely fashion to communication from the state health department when it starts doing redeterminations to see if people still qualify for coverage.

There are not clear estimates of how many people could lose coverage, either because they no longer qualify for it or because they weren’t able to communicate with the department.

The state projected about 2.6% of people covered by Medicaid expansion will lose coverage when continuous eligibility ends. That's based on past estimates showing how much enrollment increased because of the continuous eligibility policy.

But instead of calculating that as the number of people affected, the department presented figures in "coverage months," or each month of coverage that would no longer be provided. For Medicaid expansion, the estimate was 29,082 fewer coverage months. That'd equate to a savings in the state budget of about $22 million and a corresponding loss of federal matching funds.

The lack of specifics about how many people will lose coverage frustrated Democratic state Rep. Mary Caferro, of Helena, during a legislative interim meeting last August.

“We are talking about people’s health care and people’s lives. Using sterile language … those are people’s lives," Caferro said.

The department did not provide estimates of how many people could lose coverage under traditional Medicaid when asked for this story. The change is for adult populations only; children covered by Medicaid or Healthy Montana Kids will continue to receive 12-month continuous eligibility.

Communication is key

The redetermination process will involve a lot of back-and-forth between the state health department and those covered under Medicaid. That can be challenging to keep up with for people who might have moved during the pandemic and not updated their contact information with the department or lack access to regular mail delivery, the internet or a cellphone, Riutta said.

When the public health emergency ends, all affected Medicaid enrollees will receive a notice from the Department of Public Health and Human Services informing them of the change in the continuous eligibility policy, department spokesperson Jon Ebelt said in a recent email. This notice will remind enrollees about their obligation to report changes in income, family size or other circumstances that might affect their eligibility. This has always been required of enrollees, but the department could not act on it during the public health emergency. If someone’s situation has changed significantly, the department will communicate further with them to determine if they’re still eligible for Medicaid coverage.

Back in August when pressed by legislators on the interim committee that oversees the health department, the state’s Medicaid and Health Services branch manager acknowledged some people might lose their coverage because they aren’t able to stay in touch with the department.

“There are another group of people that are at risk for losing coverage because they're not responsive,” said Marie Matthews, who held the job at the time. “Part of those people may not be responsive because they’re not eligible anymore. … Part of those people may be non-responsive because the paperwork process is a process. It is incumbent upon the department to make sure we are looking at the slices and doing our best to make sure people who are eligible for the program have access if they want it.”

The number of people covered by Medicaid in Montana rose dramatically during the pandemic. In March of 2020, there were 86,788 adults accessing insurance through the expansion program. That rose to 113,850 at the start of this year, a nearly 32% increase. In traditional Medicaid, enrollment went from 42,454 to 58,847 over the same period, a 38% jump.

“During the pandemic, as folks were losing hours, were losing their jobs, what we saw was Medicaid really did its job,” Riutta said. “It was and continues to be that safety net for Montanans who were facing a lot of uncertainty and still needed access to health care.”

That leaves a lot of people for the state health department to contact. Given all the changes many families and individuals experienced over the last two years, finding the correct contact information could prove difficult.

“If you think about housing insecurity or instability, folks who may have moved during the pandemic, have changed employment, it’s critical that the department is reaching out to enrollees early and often and through various modes of communication to make sure that folks know and understand what this means for them and how they can get their information updated,” said Heather O'Loughlin, co-director of the Montana Budget and Policy Center.

Efforts from the state

Ebelt said the state health department is taking several measures to try to avoid anyone missing messages about their coverage.

“The best thing Medicaid enrollees can do right now is to update their contact information with DPHHS so that they receive any notices sent to them,” Ebelt wrote in an email.

The department is also launching a campaign Ebelt said that includes a “robust communication plan so that Montana families understand the process, timelines and impacts.”

Other efforts the department promised include adjusting the automatic renewal process to handle as many cases as possible and aligning the Medicaid renewal process with the renewals for food assistance or other programs so that both families and department staff can consolidate efforts.

The department is also planning to increase training for its employees that determine eligibility, but O’Loughlin said she’s concerned about the administrative burdens.

“There’s no question the department is stretched thin right now,” O’Loughlin said. “It is experiencing similar workforce challenges that many businesses and employers are facing right now. I think there’s a lot of concern around the department’s capacity to take on eligibility redetermination for the population we’re looking at.”

The federal Centers for Medicare and Medicaid provided guidance to states about the best way to complete redeterminations with minimal errors.

“CMS is concerned that if states attempt to initiate more than 1/9 of their total caseload in a given month, there will be an increased risk that state processes will not meet federal renewal requirements, and eligible individuals will be erroneously determined ineligible or lose coverage for avoidable procedural reasons,” the guidance reads.

The state health department didn’t have details about the timeline for the process in Montana once the federal emergency ends, but Ebelt said the state is “preparing now, and this work will be ongoing.”

Riutta said she’s heard from the state health department that it plans to stretch the process over several months, though it’s not clear yet how many that might be.

“One of the things we know is that what DPHHS has said is that they’re having a workforce shortage like the rest of us,” Riutta said “Our hope is that gets spread out as much as it can because I think it’s going to be a lot of work for the department to process all of those redeterminations and answer all of these questions at the same time folks are still applying for Medicaid as they normally would.”

Riutta also said means of contact beyond letters in the mail are critical.

“Being creative in ways of engaging and reaching folks is going to be super important if we’re going to be successful,” Riutta said.

Other avenues for coverage

If someone is found to no longer qualify, Ebelt said the department will send them a mailed notice. For people with online accounts, they can pick to receive notices by mail, online or both. Ebelt also said the department will send text reminders to people who have not returned their renewal packet by a certain date or those whose mailed notifications are returned to the department.

The department is also working with community partners, Ebelt said, to inform them of the upcoming changes so they can help people navigate the changes too. That includes sending people information about the federal health insurance exchange set up under the Affordable Care Act.

The Montana Primary Care Association also operates Cover Montana, which was awarded the federal grant to help people in Montana navigate getting coverage on the exchange. DPHHS is partnering with Cover Montana and directing people to the organization for help.

Riutta said her group is focused on two sets of people — those who are still qualified but might lose coverage because of communication issues and those who are no longer qualified but can get insurance elsewhere like the exchange.

“We are concerned that folks are going to fall through the cracks because it’s a lot of people and people’s lives are complicated and we talk to people all the time who maybe they don’t open their mail for a handful of days and that’s the difference between having a gap in coverage or not,” Riutta said.

Losing coverage is a challenge for people who are already accessing health care because it can mean either having to pay expensive out-of-pocket costs or a pause in treatment for chronic conditions that can lead to bad outcomes.

For a patient who is seeing a specialist, finding coverage means making sure a new plan includes their doctor in addition to fitting in their monthly budget. During the pandemic, the federal government boosted subsidies for people buying plans on the exchange, but that's set to expire at the end of the year. Part of the Biden administration's Build Back Better plan could extend them, but it's stalled in the Senate.

Tracking what happens

Back in the August meeting when pressed by Democrats opposed to ending continuous eligibility, state health department Director Adam Meier said the move equates to no longer paying for coverage for when people are not qualified for it.

“The change will basically be that we’re basically shifting to what 48 other states do in terms of returning to the basic Medicaid eligibility,” Meier said. “What we’re really doing here is changing back to the default of what Medicaid defines nationally as the standard for eligibility. In terms of changes to individuals, there’s not a whole lot of change on their end in terms of what’s required by them.”

Matthews said the department would watch certain data points to try to determine if people were improperly losing coverage and use that information to act.

“I'm never going to know if 100% of the people who want to be on the program and are eligible for the program are on it. What I can do is watch information to see if we see an uptick in (data showing people moving on and off the program). Then I can help drive discussions on how do we reduce that? … Our goal is to make sure that we operate programs that are accessible and manage and support individuals who have a harder time managing those program requirements,” Matthews said.

“ ... We want to make sure that we do a good job of not losing people (over) paperwork and for people who are no longer eligible for the program to move onto programs they're eligible for."