The problem of Medicaid coverage disruption is well-documented, and it happens for many reasons.1 Sometimes, it is because the person is homeless.2
Researchers analyzed Medicaid claims data from 2017. They found 22.9% of patients with a homelessness code experienced coverage interruption at least once vs. 18.8% of Medicaid patients without a homelessness code. Gerry Baker, MBA, senior vice president for revenue cycle at Parkland Health & Hospital System in Dallas, says there are some other common reasons people lose their Medicaid coverage: income changes, residency changes, the insured is no longer pregnant, the insured’s children age out, noncompliance with status updates, or the insured is no longer disabled. “If SSA [Social Security Administration] or the state loses track of the people, they often will terminate the Medicaid,” Baker says.
If a patient is in this situation, registrars help him or her contact SSA. Often, this action alone is enough to reinstate benefits. “We assist with providing missing updates with new applications for Medicaid and with renewing or reinstating Medicaid coverage,” Baker says.
Meera Mani, MD, PhD, partner and leader of McKinsey & Company’s Medicaid work, explains preventable coverage disruptions occur because members do not realize they had to renew (or when to do so), and miss the deadline. Also, members might struggle to submit all required documentation. Patient access staff can help people keep their Medicaid coverage by explaining the process. “This can have a positive impact in limiting coverage disruption for eligible beneficiaries,” Mani says.
Coverage loss often happens at the point of renewal. “Most states approach it from an old school perspective and mail out a notice,” says Jennifer Wagner, director of Medicaid eligibility and enrollment at the Center on Budget and Policy Priorities.
The person has to receive the notice, understand it, complete it, and send it back on time, sometimes with pay stubs or other proof of income. “That is a very challenging process for a lot of people, and it leads to a lot of eligible people losing coverage and having to reapply,” Wagner reports.
Other times, the problem is just a bad address. Notices are returned as undeliverable, causing loss of coverage. Some states bypass this issue with automatic renewal processes, based on information from available databases without the need to send paper documents.3
With automatic renewals, the client receives a notice that benefits have been renewed, but does not have to respond to the notice. “A lot of states don’t take full advantage of that process and have overly restrictive rules. A handful of states don’t do it at all,” Wagner laments.
Right now, most Medicaid coverage disruptions are on hold thanks to exemptions under the Families First Coronavirus Response Act. These are expected to last through 2021. After that, states will have to catch up on a large number of renewals. “There’s a huge risk that people will lose coverage at that point,” Wagner cautions.
To protect against lost revenue, patient access staff could help patients re-apply for Medicaid to obtain retroactive coverage. “But it’s a lot more hassle for everyone involved to reapply. The person may have forgone treatment or prescriptions while they had a gap in coverage,” Wagner observes.
Right now, there is a chance for states to avoid all this by automatically renewing as many patients as possible. “People aren’t losing coverage right now. But it’s an opportunity to get things in place so people won’t lose coverage when the public health emergency ends,” Wagner offers.
As for what revenue cycle departments can do to help, it depends somewhat on how much front-end staff can see in the state system. In some cases, there might be a way for the hospital to submit updated addresses for the patient, or at least log onto the state portal so the patient can update the address. This simple intervention can prevent coverage notices from going to an old address. “If there is somebody who can sit face to face with someone and help them through that process, that’s significant,” Wagner says.
Patient access staff can look at the state’s Medicaid Management Information System to see if there is active coverage. Some states also show the renewal date. “Many people don’t realize what the cycle is and when they are due for a renewal,” Wagner says.
The implications for patients go beyond just obtaining health coverage. “Some states have combined applications that allow people to apply for Supplemental Nutrition Assistance Program (SNAP) at the same time as Medicaid,” Wagner notes.
If so, registrars can help patients download the mobile app or log onto the online portal. “Sometimes, five minutes of handholding can get someone over the initial hurdle of setting it up,” Wagner says. “It is very valuable, with minimal extra effort.”
Short-term interruptions in SNAP benefits resulted in differential patterns of healthcare utilization, according to a recent study.4 Researchers found half the SNAP population experienced a short-term interruption in their benefits and that it happened more often for women, African Americans, and young patients. Those with SNAP disruption logged fewer outpatient visits, ED claims, and prescription drug claims, but more inpatient claims.
“This is exactly what you might expect if patients are making trade-offs between food and healthcare. It suggests that the trade-off had negative health consequences requiring acute care,” says Colleen Heflin, PhD, the study’s lead author and a professor of public administration and international affairs and a senior research associate in the Center for Policy Research at Syracuse University.
In light of this finding, hospital-based financial counselors could consider asking patients about their SNAP coverage to help them remain on the program. “It may be that some patients lose SNAP benefits during periods of hospitalization because they are unable to complete the required paperwork during acute health events,” Heflin notes.
- Sugar S, Peters C, DeLew N, Sommers BD. Medicaid churning and continuity of care: Evidence and policy considerations before and after the COVID-19 pandemic (Issue Brief No. HP-2021-10). Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services. April 12, 2021.
- Dapkins I, Blecker SB. Homelessness and Medicaid churn. Ethn Dis 2021;31:89-96.
- Wagner J. Streamlining Medicaid renewals through the ex parte process. Center on Budget and Policy Priorities. March 4, 2021.
- Heflin C, Hodges L, Ojinnaka C. Administrative churn in SNAP and health care utilization patterns. Med Care 2020;58:33-37.