HHS Announces Medicaid-CHIP Coverage Surge Amid “Inappropriate” Disenrollments

CMS is requiring states to pause disenrollments as greater scrutiny is placed on the health insurance programs that cover the nation’s most vulnerable populations.

Citing a wave of “inappropriate” disenrollments, federal officials said last week that they are pushing to ensure that many of the nation’s most financially vulnerable children and families retain their health insurance coverage.

The U.S. Department of Health and Human Services (HHS) specifically said that it has helped half a million children and families regain their Medicaid and Children’s Health Insurance (CHIP) coverage. The move comes after the Centers for Medicare & Medicaid Services (CMS) last month issued a call to action to states regarding what they described as “systems inappropriately disenrolling children and other enrollees, even when the state had information indicating the person remained eligible.”

Additional corrective actions are expected to follow.

“Thanks to swift action by HHS, nearly half a million individuals, including children, will have their coverage reinstated, and many more will be protected going forward. HHS is committed to making sure people have access to affordable, quality health insurance – whether that’s through Medicare, Medicaid, the Marketplace, or their employer,” HHS Secretary Xavier Becerra said in a statement. “We will continue to work with states for as long as needed to help prevent anyone eligible for Medicaid or CHIP coverage from being disenrolled.”

“Medicaid and CHIP are essential for millions of people and families across the country,” CMS Administrator Chiquita Brooks-LaSure added. “Addressing this issue with auto-renewals is a critical step to help eligible people keep their Medicaid and CHIP coverage during the renewals process, especially children. CMS will keep doing everything in our power to help people have the health coverage they need and deserve.”

Following correspondence sent Aug. 30, federal officials noted that to avoid CMS taking further action, a total of 30 states were required to pause procedural disenrollments for impacted individuals unless they could ensure that no eligible people were being improperly disenrolled. CMS said the correspondence “alerted states to a potential eligibility systems issue related to automatic renewals for Medicaid and CHIP coverage.”

Specifically, CMS pointed to such “auto-renewals” (also known as “ex parte” renewals) as “one of the strongest tools that states have to keep eligible people enrolled in Medicaid or CHIP coverage during the renewals process.” Federal rules require states to use information already available to them through existing, reliable data sources (such as state wage data) to determine whether people are eligible for Medicaid or CHIP.

“Auto-renewals make it easier for people to renew their Medicaid and CHIP coverage, helping to make sure eligible individuals are not disenrolled due to red tape,” the agency said in a press release. “CMS continues to provide technical assistance to states as they address these system issues.”

“Throughout the renewals process, CMS has offered states many strategies to assist them in making it easier for people to renew their coverage,” the press release added. “Nearly all states have adopted at least some of these strategies, and CMS continues to urge states to adopt these strategies. Additionally, to help make transitions from Medicaid to other health coverage options more accessible in every state, CMS has launched national marketing campaigns and made available Special Enrollment Periods through HealthCare.gov, State-based Marketplaces, and Medicare.”

Nearly 87 million Americans are enrolled in the Medicaid program, with 7 million more covered by CHIP, according to a May 2023 federal estimate. After declines in Medicaid and CHIP enrollment from 2017 to 2019, a Kaiser Family Foundation report estimated that combined enrollment leaped upward by nearly 30 percent from the advent of the COVID-19 pandemic in 2020 through the end of last year. To view a preliminary overview of state assessments regarding compliance with Medicaid and CHIP automatic renewal requirements at the individual level (as of last week), go to https://www.medicaid.gov/resources-for-states/downloads/state-asesment-compliance-auto-ren-req.pdf