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Millions will lose Medicaid coverage when pandemic-era rule expires

A pandemic-era rule that protected people from losing their Medicaid coverage will expire on Friday, putting the health insurance coverage of millions at risk.

Medicaid provides free health insurance to low-income people.

Usually, Medicaid beneficiaries must renew their coverage every year, and if they are no longer eligible, they lose their coverage. But lawmakers passed a rule in 2020 that kept people automatically enrolled in the government program, even if they no longer qualified for coverage.

That protection will end at midnight on Friday, leaving up to 15 million people at risk of losing their health insurance, according to an estimate by KFF, a nonprofit research organization formerly known as the Kaiser Family Foundation. Some 95 million people in the United States are currently enrolled in Medicaid and CHIP, which provides low-cost coverage for children, according to KFF.

Even a small coverage gap can be “devastating,” said Jennifer Tolbert, associate director of the Medicaid and Uninsured Program at KFF. Some might not have access to their monthly medications, she said, while others might not have access to treatment for their chronic physical or mental health conditions.

Those most likely to be affected by the change are “children, young adults, black people, and Hispanic or Latinx people,” according to Carrie Fry, professor of health policy at Vanderbilt University School of Medicine in Nashville, Tennessee.

“In sum, this is a convenient situation to minimize the number of people losing their Medicaid coverage,” Fry said.

What is happening?

Starting Saturday, states will be allowed to begin “relaxing” — a process by which they resume their annual Medicaid renewals and unenroll people who are no longer eligible for coverage.

Eligibility for Medicaid varies by state, but generally people can qualify if their income falls below a certain threshold. In New York, for example, a single person whose income is less than $19,392 per year before taxes or a married couple whose income is less than $26,228 per year may qualify for the program. Going even slightly above that threshold could make a person ineligible for coverage.

People shouldn’t expect “a deluge of people” losing their Medicaid coverage on Saturday, Tolbert said.

The rollout period is expected to last about 12 months as states verify everyone’s eligibility and send out renewal and termination notices, though some states will complete those checks faster than others, Tolbert said.

Eight states began sending renewal notices to Medicaid recipients in February, followed by 15 more states in March, Tolbert said. Despite the early start, no state is allowed to unsubscribe recipients before April 1.

Another 28 states are expected to begin the process in April. States must allow enrollees at least 30 days to respond to a renewal notice and an additional 10 days after a notice of termination of coverage.

During that 12-month period, 5 to 15 people are expected to lose their Medicaid coverage, Tolbert said. Unsubscribes will start pouring in in April.

People whose incomes have increased should be among those who lose coverage, she said. But people who are still eligible but haven’t provided information their state needs to confirm — like income or current residency — should also lose their insurance, she added.

Why does this happen?

Medicaid’s continued coverage requirement was originally related to the Covid-19 public health emergency, which will expire in May.

In December, however, Congress passed the Consolidated Appropriations Act of 2023, which set a new end date for the March 31 Medicaid coverage rule.

Along with the new end date, states are required to attempt to contact enrollees before terminating their coverage.

The change is “disruptive,” said Dr. Adam Gaffney, a critical care physician at the Cambridge Health Alliance in Massachusetts, who advocates for health care reform.

Medicaid enrollment rose 23.9% from 2020 to 2022 — an increase of 17 million people — according to a 2022 KFF report.

Many patients being kicked out of Medicaid will likely have “significant health care needs,” Gaffney said.

What can people do?

States will terminate Medicaid coverage if a person does not complete the renewal application by the state deadline.

People with Medicaid should make sure their addresses are up-to-date, keep an eye out for Medicaid application documents by mail or email, and complete the renewal application before their state’s due date, said Vanderbilt’s Fry.

Tolbert said if people have moved in the last few months and haven’t told Medicaid their address has changed, they may need to verify their previous address for the application. Others may have a language barrier and need help filling out the form.

Health systems, social service agencies, and community and faith-based organizations sometimes provide enrollees with assistance with updating Medicaid applications, Fry added.

People who lose their Medicaid coverage will be able to purchase coverage under the Affordable Care Act, Gaffney said. The termination notice must provide instructions.

He noted that the Inflation Reduction Act extended subsidies until 2025 for some people who buy individual coverage through the ACA.

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