State Medicaid, children’s health insurance programs (CHIP) and health insurance marketplaces strive to prepare for an expected increase in the demand for their services as they navigate a world roiled by COVID-19, an economic downturn and ensuing budget crises, and unpredictable federal relief efforts.
As the COVID-19 public health emergency continues to destabilize the economy, more individuals are turning to their state Medicaid agencies for health coverage. To date, more than 40 million Americans have filed for unemployment benefits in the past 10 weeks, and with job losses many individuals will inevitably lose employer-based health coverage.
Current projections show Medicaid enrollment climbing in the coming months. A recent study conducted by the Kaiser Family Foundation (KFF) estimates that close to 27 million people could lose their employer-sponsored insurance (ESI) due to the economic fallout from COVID-19, and about 12.7 million will be eligible for Medicaid coverage. In a similar study, the Urban Institute projects that 47 percent of individuals who lose ESI would enroll in Medicaid, increasing national enrollment in the program by approximately 11.8 million. Together, these findings show that Medicaid will become the primary source of coverage for individuals who have lost ESI coverage.
While enrollment data from the initial period of the COVID-19 health crisis is not expected to be released by federal officials for several months, local news organizations are reporting preliminary state data that shows some states have already started to experience significant increases in Medicaid enrollment.
- Hawaii’s Medicaid program has received over 21,000 applications since early March, representing an increase of 40 percent from this time last year.
- In April alone, Ohio added 140,000 individuals to its Medicaid program, which brings the percentage of the state’s population covered by Medicaid to 25 percent.
- Michigan and Delaware also experienced significant enrollment spikes, despite declining enrollment during the same period last year, and other states reporting recent enrollment increases include Connecticut, Georgia, New Jersey, New Mexico, Oregon, Pennsylvania, and Virginia.
Some of these enrollment changes could be the result of requirements states must comply with to receive the 6.2 percentage-point increase in the federal medical assistance percentage (FMAP) provided by the Families First Coronavirus Response Act. To receive the increase, states cannot terminate Medicaid coverage during the emergency period for individuals enrolled on or after March 18. However, this likely only accounts for a small portion of the increased enrollment.
While it will take months to understand the full scope of Medicaid enrollment trends during this health and economic crisis, a recent KFF survey found that the vast majority of states with enrollment projections anticipate that enrollee growth this year will far exceed pre-COVID projections for state fiscal year (SFY) 2020 and will continue to rise through SFY 2021.
There could also be an uptick in enrollment in the Children’s Health Insurance Program (CHIP) as families lose ESI and seek coverage options for their children. However, the number of families whose incomes make them eligible for CHIP is not yet known, and some may instead become eligible for Medicaid. Some states have indicated that CHIP enrollment is staying stable or slightly rising because states are opting not to process terminations during the emergency period, while other states have reported significant spikes in CHIP enrollment. Notably, Pennsylvania enrolled 10,200 new children in March and April of this year, increasing its total CHIP population by 5 percent.
Despite these initial reports of increased enrollment over the course of the emergency period, many state officials expect it will take several months before public health coverage programs feel the full effects of the economic crisis. State health officials credit this to several factors, including:
- Grace periods and premium flexibilities that have allowed some employers to maintain coverage for their furloughed and terminated workers;
- Consumer priorities, which are focused on securing immediate needs, such as unemployment benefits and food and housing assistance; and
- Knowledge gaps about where to seek coverage.
To help increase and maintain access to Medicaid and CHIP coverage during the COVID-19 pandemic, many states have elected to pursue flexibilities though disaster relief state plan amendments (SPAs) to ease eligibility determination and cost-sharing requirements and expand opportunities for enrollment. Many states have chosen to waive premiums or copayments, expand presumptive eligibility, and allow for self-attestation of certain eligibility criteria. According to a KFF analysis, 43 states have implemented actions to facilitate access to coverage in Medicaid and CHIP amid the crisis, and the National Academy of State Health Policy (NASHP) is also tracking flexibilities that states have adopted through Medicaid and CHIP SPAs.
State-based health insurance marketplaces have also served as a point of entry for Medicaid coverage for many individuals who have lost employer-based health coverage. Of the 13 state-based marketplaces, 12 have elected to open special enrollment periods (SEPs) for uninsured individuals in the wake of COVID-19. These SEPs have drawn attention to the coverage options that exist outside of employee health plans through advertising campaigns and direct outreach coordinated with states’ labor and unemployment departments. Among the states that that have released enrollment data from their COVID-19 SEPs, Minnesota and Maryland have reported that over 50 percent of individuals who gained coverage through the SEPs were found to be eligible for Medicaid.
As states continue to invest in efforts to enroll a greater number of eligible individuals in Medicaid, they will need to contend with looming budget constraints. In the coming months, states will be challenged with shrinking state revenues and growing costs associated with increased Medicaid enrollment and testing and treatment for COVID-19. It is likely that as emergency protections, such as grace periods for premium payments, for consumers in the commercial market end, more individuals will lose their insurance and may be eligible for publicly subsidized health coverage.
Also, because the increased FMAP is only available through the public health emergency period, an additional concern for states is that it may not be adequate for addressing the long-term economic effects of the outbreak. Governors have already expressed the need for an additional increase to the FMAP and for an extension of this increase through September 2021, but unless Congressional action occurs, states will be facing difficult choices. For many states, budget shortfalls will require significant cuts to Medicaid, leading to new challenges as an unprecedented number of individuals rely on public programs for coverage. NASHP will be continuing to support state officials as they navigate through these complex budgetary, policy, and operational issues.
As unemployment rates rapidly rise and more individuals seek new health coverage options, states are preparing for an influx of new Medicaid and insurance marketplace enrollees. While the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides significant support for a broad array of services, its $600 a week in additional unemployment compensation could pose costly complications for states and individuals.
More than 30 states have proposed or are in the process of implementing Medicaid work requirements, in some cases to enable Medicaid expansion. Read what individual states are doing and what’s behind their efforts.
Since January, when the Centers for Medicare & Medicaid Services (CMS) announced it would allow states to require certain enrollees to participate in work or community engagement activities in exchange for Medicaid coverage, three states have secured federal approval to impose the requirements, nine have proposals pending before CMS, four are drafting them, and at least 16 state legislatures have introduced bills.
Under the new guidelines, states can seek CMS permission to add work requirements for non-elderly, non-pregnant, and non-disabled adults as a condition of Medicaid eligibility. State proposals vary in their scope and political context. In some states that implemented the Affordable Care Act’s (ACA) Medicaid expansion, the work requirement applies only to the expansion population. In other states, it affects a broader group of Medicaid enrollees. Some states are presenting work requirements as a compromise to win political support for or to retain Medicaid expansion, although many non-expansion states are also considering them.
Currently, Arkansas, Kentucky, and Indiana are in the process of implementing these requirements for certain Medicaid enrollees (Kentucky’s waiver now faces a court challenge). Additional states have pending proposals before CMS and others plan to submit them in the next few months. Alabama recently closed the comment period on its draft waiver proposal to add work requirements for parents and caretaker relatives covered by Medicaid. This week, Ohio submitted its application to implement work requirements specifically for its Medicaid expansion population.
Utah recently passed legislation that requires state officials to pursue a waiver to implement Medicaid work requirements in conjunction with its request to expand Medicaid up to only 100 percent of the federal poverty level. South Carolina’s governor directed the state Medicaid agency to develop a work requirements waiver, and the state is in the early stages of doing so. South Dakota’s governor mentioned in his annual address that the state would be seeking a Medicaid work requirement waiver, and a workgroup has begun meeting on the topic with plans to submit an application in July 2018.
In some states, Medicaid work requirement discussions are occurring in state legislatures, and are sometimes tied to proposals to expand Medicaid. During Virginia’s special legislative session in mid-April, the House of Delegates passed its most recent version of the budget that includes provisions to expand Medicaid and require the new, eligible enrollees to work. The legislative package now moves to the state Senate, but the Finance Committee will not be meeting until mid-May.
A number of other states that have not expanded Medicaid have proposed bills to seek federal waivers to implement work requirements for certain adults in their traditional Medicaid programs. Tennessee’s legislature recently passed a bill that is now headed to the governor, who is expected to sign it. Other non-Medicaid expansion states that have introduced Medicaid work requirement bills during their 2018 state legislative sessions include:
- Florida: While the House passed a bill, it did not progress past a Senate committee prior to the legislative session ending.
- Idaho: State legislators added Medicaid work requirements to a bill that also included the proposed Idaho Health Care Plan, but the legislature adjourned without advancing it.
- Missouri: In January, a bill was introduced in the Senate and remains in committee.
- Oklahoma: In addition to the governor issuing an executive order in March for the state to begin drafting a waiver, in mid-April, a bill passed the Senate and is now moving to the House.
- Wyoming: Although the legislature has adjourned, legislation did pass the Senate but did not move forward.
In some states that expanded Medicaid, state legislators have introduced bills that include work requirement proposals. Most of them would apply to a broader group than the expansion population and would include all “able-bodied” adults, such as some parents — with varying exceptions:
- Alaska: Bills were introduced in both the House and Senate in February, but they have not moved past the committee level.
- Connecticut: In February, a Senate bill was proposed (exempting individuals who are the sole caretaker of a dependent), but the legislation stalled.
- Illinois: A bill was introduced in the Senate (exempting adults with dependent children), but it did not move forward.
- Iowa: Legislators proposed a bill in the House, but it did not advance because it was deemed to need additional revision and would be too costly to implement. A similar bill in the Senate has also not moved forward.
- Louisiana: There are bills in both the House and Senate that remain in committee.
- Michigan: In mid-April, a bill was approved by the Senate and now moves to the House; however, the governor’s office has expressed opposition to it.
- Minnesota: A bill was introduced in the Senate in mid-March (exempting individuals who are the sole caretaker of a dependent) and is currently in committee.
- Pennsylvania: A bill in the House passed in mid-April and will move on to the Senate; however last year the governor vetoed a similar bill.
In Colorado, a Medicaid work requirements bill failed to pass a Republican-controlled committee in March — the legislator who voted against it suggested the state should assess the implementation process in other states like Kentucky before moving forward with the program change.
CMS’ guidance left many decisions about the parameters of a Medicaid work requirement to state discretion, such as the number of hours that individuals must complete, penalties for noncompliance, the types of qualifying activities, and how often individuals would need to submit documentation to demonstrate they are meeting the requirements. For states considering adding these types of requirements to their Medicaid programs, there are also many other policy and operational issues to address.
For example, tracking whether enrollees are complying with the work requirements as well as determining which individuals qualify for exemptions is expected to be a complex and costly administrative task — and could result in coverage losses for individuals. An additional factor for states to weigh is that according to an analysis conducted by the Kaiser Family Foundation, most non-elderly adults covered by Medicaid already work — 60 percent are employed either in part-time or full-time jobs. Another 32 percent reported not working due to illnesses or disabilities, enrollment in school, or caregiving responsibilities, and consequently many of these individuals may qualify for work requirements exemptions.
Though many state legislative sessions are coming to a close, this issue is expected to continue to receive active consideration by state policymakers. NASHP will continue to monitor states’ work requirement waiver proposals that have been submitted to CMS in this chart.
If federal funding is not extended for the Children’s Health Insurance Program (CHIP) beyond September 2017, some children may need to transition to exchange coverage. NASHP’s new brief examines potential options and policy questions for improving exchange coverage for children in terms of both affordability and pediatric benefit adequacy. NASHP convened a group of stakeholders including state officials, health policy researchers and advocates to explore ways to maintain affordable and comprehensive children’s coverage. The brief summarizes the key themes from the group’s discussion and builds upon the policy options identified in this previous NASHP brief. Attending #NASHPconf16? Be sure to check out our newly announced session on CHIP.
As a result of the Affordable Care Act (ACA) and the creation of health insurance exchanges, there are more coverage options for pregnant women in all states. In addition to insurance through exchanges, all states offer Medicaid coverage for pregnant women and a number of states also offer them coverage through their CHIP programs. Although there are coverage options for most pregnant women, these different coverage types do have different eligibility criteria, cost sharing and benefits.
NASHP has created a few resources to help explain the different eligibility criteria for multiple coverage options, including a chart that details income eligibility for each state’s Medicaid and CHIP programs from 2013 – 2015 and maps that highlight the income eligibility ranges. NASHP also created a couple of infographics (Julie, Samantha) that note enrollment steps for pregnant women with different income seeking coverage and raise policy implications for states.
View the chart
View the map
Path to Coverage for Pregnant Women: Julie
Path to Coverage for Pregnant Women: Samantha
The following is a statement from NASHP Executive Director Trish Riley regarding the Supreme Court decision on King v. Burwell.
“With their decision today, the Supreme Court has protected coverage for 6.4 million Americans and avoided a crisis for states and their insurance markets, had the insurance subsidies been eliminated. The Court recognized the ACA was built on a state foundation and reaffirms whether a state chooses to establish a state exchange or not, affordable health coverage remains accessible for its residents.
The wait and see period is over and now states can move forward. Leaders in the 34 states that rely on the FFM can examine and improve coordination between their Medicaid and CHIP programs and the FFM to ensure a seamless coverage experience; consider ways to make coverage more affordable in their markets; design new exchange models to offer states more flexible roles; and carefully review opportunities to seek significant waivers in 2017 that will allow for more state experimentation in providing affordable, quality coverage.
The National Academy for State Health Policy (NASHP) looks forward to working with states as they continue their ACA implementation journey, post-King. We will be convening state health policy leaders in early July to discuss next steps and will release a summary of those discussions to inform the broader policy community later this summer.“
In addition to Trish Riley, two of our state health policy leaders are available for media interviews to discuss the case and next steps:
- Carrie Banahan, Executive Director, Office of the Kentucky Health Benefits Exchange
- Peter Lee, Executive Director of the California Health Benefit Exchange
To schedule an interview please contact Lesa Rair, 202-903-2785 or firstname.lastname@example.org
The National Academy for State Health Policy (NASHP) is an independent academy of state health policymakers who are dedicated to helping states achieve excellence in health policy and practice. A non-profit and non-partisan organization, NASHP provides a forum for constructive work across branches and agencies of state government on critical health policy issues.