North Carolina Shows States Can End the Great Medicaid Purge—and So Can the Federal Government

In what’s being cited as an “unusual move, ” North Carolina Governor Roy Cooper (D) is expanding Medicaid in the state this October in advance of funding approval, pressuring Republican leaders to fund Medicaid expansion on its own or pass a budget.

Gov. Cooper’s decision is not an unusual move - it’s the right move and more states should follow his lead. At least one million people have already lost Medicaid coverage due to the end of the COVID-19 Public Health Emergency (PHE) Continuous Medicaid enrollment policy, pushing an already-vulnerable population down a path of widening disparities and disruptions in care. Black and Latino individuals make up over 39% of those predicted to be ineligible for Medicaid and over 48% of those predicted to lose coverage due to administrative barriers.

Researchers like myself are gearing up to meticulously study the numerous impacts of this “Great Mass Medicaid disenrollment” and expect findings to trend in a negative direction.

Individual financial health and equity gaps will worsen as medical debt increases. Providers in rural areas and those serving low-income populations will be more likely to close shop, reducing access to care.

Medicaid is a public health insurance program, jointly financed by the federal and state governments, that currently covers 86 million low-income individuals. Eligibility differs by state and is based on the federal poverty level.

To minimize Medicaid disenrollment, the Federal government will gradually phase down the 6.2% payment increase in states that comply with Federal rules including eligibility standards, conducting renewals, and insurance premiums. On the state level, infrastructure, capacity, and political appetite vary widely, affecting the number of people who lose Medicaid coverage due to cumbersome administrative burdens. Ironically, the same federal government that ended the Medicaid continuous enrollment is also providing financial incentives for states to expand Medicaid programs and urging states to adopt all available options to “ensure that individuals do not lose coverage due solely to administrative processes.”

Medicaid expansion is high on the list of what states can do to protect thousands of individuals. Currently, 10 states have not expanded Medicaid programs, despite the Federal government covering 90% of associated costs. This is well above the average Federal match for the traditional Medicaid population that ranges from 50% to 77%. Additionally, states can extend Medicaid postpartum coverage to 12 months and implement 12 months of continuous enrollment for children.

States could also automate processes for eligibility renewals and strengthen outreach campaigns. Ex parte renewals (passive or automated renewals) are processed based on the enrollee’s previous information and other electronic data sources including the Social Security Administration, Equifax’s Work Number, and the Supplemental Nutrition Assistance Program.

Additionally, outreach campaigns in different languages can protect individuals with Limited English Proficiency who are more likely to experience administrative challenges when renewing Medicaid coverage. During my time working as a tri-lingual Medicaid enrollment specialist for a large safety-net hospital system, our community-wide multilingual campaigns were critically important in protecting vulnerable individuals during the largest healthcare reform in Massachusetts.

For the 8.2 million individuals who will lose Medicaid coverage due to ineligibility, states can improve transitions from Medicaid to marketplace private health insurance coverage by implementing auto-enrollment into marketplace plans similar to California and Rhode Island’s models. States can also establish a “basic health program”, as in New York and Minnesota, which are more affordable options compared with marketplace plans.

The current Great Mass Medicaid disenrollment will dig its heels into the necks of individuals who are low-income, homeless, racial minorities, live in rural areas, and have limited English proficiency. Avoiding this catastrophic loss of healthcare coverage is the first step in protecting the well-being of the most vulnerable among us.