Act now! Churn will continue
Much revenue is at stake
"Churn" — when otherwise-eligible Medicaid beneficiaries are disenrolled and re-enrolled in the program — is a frequent problem and will continue to be so under the Affordable Care Act (ACA), according to Benjamin D. Sommers, MD, PhD, assistant professor of health policy and economics at Harvard School of Public Health in Boston.
"The most helpful approach is to remind people that their coverage has lapsed and assist them in re-applying for coverage using the ACA’s "single streamlined application," says Sommers. This application will determine if the patient is eligible for Medicaid, exchange tax credits, or neither.
If the patient churns off the Medicaid program and is moving to an exchange plan, this move doesn’t necessarily mean less revenue for the hospital, he adds. "This depends on the payment rates in Medicaid versus exchange plans, which we don’t know yet because the exchange plans aren’t in existence yet," says Sommers.
If the patient becomes uninsured, however, Sommers says it is highly likely that many hospitals will get paid little or nothing. "Low-income, uninsured patients rarely have adequate savings to pay for a costly hospital stay," he says. "This becomes uncompensated care or bad debt."
Much of the old system is about to change, although this change will vary from state to state, notes Leighton Ku, PhD, MPH, professor and director of the Center for Health Policy Research at George Washington University in Washington, DC.
Under the ACA, the federal government and states are supposed to have integrated, simplified application systems online in which people can enroll for the health insurance exchanges and, at the same time, apply for Medicaid or CHIP by Oct. 1, 2013. "But there will probably be delays in some areas," says Ku. "And in states that don’t expand Medicaid, the integrated application systems may just refer someone to the Medicaid program without additional support."
The advent of new simplified, integrated online application systems for Medicaid, CHIP and health insurance exchanges "can make a big difference in ensuring that people get coverage," Ku says.