More Than 70 Percent of Dropped Medicaid Recipients Were Eligible: Survey

More Than 70 Percent of Dropped Medicaid Recipients Were Eligible: Survey
A ring of twenty US dollar bills with a bottle of prescription drugs. (KAREN BLEIER/AFP/Getty Images)

Medicaid recipients across the United States have fallen by 10 million after COVID rules ended this year, but procedural reasons, such as a lack of submitting renewal requests, constitute 71 percent of the fall, according to a survey.

The Kaiser Family Foundation (KFF), a health policy organization, found that after Medicaid recipients peaked at 93 million people during the pandemic period there were 10.6 million removals as of Nov. 14. Most of these people, 71 percent, were eligible for Medicaid.

The pandemic period mentioned above is the roughly three years from the start of the COVID rules in February 2020 reaching to the end of COVID rules in April this year.

On the other hand, almost 20 million people renewed their coverage as of Nov. 14.

More than 23 million people started receiving Medicaid after 2020. In other words, more than 1 out of 4 Americans were receiving state-funded health care during the COVID period. It is probable that many of these new recipients did not know that a renewal was needed, because there was no need for submitting renewal documents during the so-called COVID emergency period.

KFF predicts that there will be a further 8.4 percent reduction in Medicaid recipients during 2024, as people that have not submitted their renewal papers continue to be removed.

The research covered all 50 states and Washington, D.C., and it is updated with new data regularly, according to KFF.

Procedural reasons can be a lack of a renewal form sent by the interested person, or incomplete paperwork, or mistakes in handling by the state.

The phenomenon is called Medicaid unwinding after the COVID period surge in enrollment. It is estimated to have left more than 2 million eligible children without state-funded health care as well.

It is probably caused by the “continuous enrollment” policy three years ago, where Congress thought that during a health emergency people should not be left without medical care, and so it passed a federal law that did not allow states to disenroll people from Medicaid.

Last December however, an omnibus bill enacted by Congress stipulated that states can begin reviewing Medicaid beneficiaries starting from their 2020 backlog, and checking if they have submitted the required papers for renewal, in other words, if they are still eligible for Medicaid. The bill said that states can now start disenrolling ineligible people.

During the three years of COVID rules in effect, there was an increase of nearly 23 million Medicaid beneficiaries. These beneficiaries were the most vulnerable in being disenrolled, as their first impression of Medicaid was that no filling of papers is needed for a renewal.

Other scenarios are that some former enrollees may now have income higher than the Medicaid’s limit, as they have started working again after the COVID shutdowns. In other cases, because states have made it burdensome for people who were dropped to reenrol, people had a hard time completing the paperwork, as the bureaucracy is difficult to navigate, according to Forbes.

States with the highest disenrollment for procedural reasons were New Mexico (96 percent), Utah (94 percent), Nevada (93 percent), and California (88 percent).

States where the disenrollment happened for other forms of ineligibility and not for procedural reasons are Oregon, Illinois, and Maine, with 7 percent, 16 percent, and 30 percent respectively of disenrollemnt due to procedural reasons. This means that people in these states were not confused by the continuous enrollment rule during the COVID period.

The survey also found that state spending is going to increase 17 percent next year, as federal spending is gradually ending.

National health spending grew 2.7 percent to reach $4.3 trillion in 2021, according to the Centers for Medicare and Medicaid Services website.

Medicare spending grew 8 percent to reach $900.8 billion in 2021, while Medicaid spending grew 9 percent to reach $734 billion in 2021. Out of pocket spending was $433.2 billion, or 10 percent of the total national health spending.

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