Unwinding of Medicaid Continuous Coverage: What Does It Mean for You?

Soon, millions of Americans with low income—including older adults and people with disabilities—may lose their Medicaid benefits or experience gaps in coverage. This is because the Medicaid continuous coverage provision created in 2020 ended on March 31, 2023.  

Why is Medicaid continuous coverage ending?

In March 2020, the Families First Coronavirus Response Act was signed into law to create a health care safety net for low-income Americans during COVID-19 shutdowns. It prevented states from terminating Medicaid coverage until after the public health emergency was over—regardless of people’s eligibility. This “pause” on Medicaid disenrollments has allowed most enrollees to maintain continuous coverage during the past three years.

However, with the end of the COVID-19 PHE on May 11, 2023, federally funded programs are returning to their normal rules and requirements. This means the temporary but important changes to Medicaid enrollment and eligibility will no longer be in effect. As early as February 2023, states were allowed to resume the redetermination process, which checks to see if a person is still eligible for Medicaid at renewal. States were permitted to remove people from the Medicaid rolls as early as April 1, 2023. This Medicaid “unwinding” process will continue through May 2024.

Up to 17 million people could lose their Medicaid benefits during this transition.¹ This number includes people who no longer qualify for Medicaid as well as people who are still eligible, but face practical barriers to getting their coverage renewed (e.g., not receiving or having trouble completing and/or returning the necessary materials to prove their eligibility).

I have Medicaid. How can I prepare for these changes?

You should receive your Medicaid redetermination paperwork roughly 30 days prior to your renewal deadline date (renewal dates vary from state to state). The redetermination letter will tell you if your coverage has been renewed for another year, or if you must complete paperwork that will help determine if you’re still eligible. To prepare for Medicaid redetermination, you’ll want to complete the following steps:

1. Make sure your contact information is up to date with your state’s Medicaid agency: It’s important they have your correct address, phone number, and email address on file. This will help ensure you receive communications on time. Find your state agency on Medicaid.gov.
2. Check your mail every day: Your Medicaid redetermination letter will arrive by mail, so it’s important to check your box every day (or have a neighbor or family member collect your mail for you). You might also receive important updates and notices from your Medicaid managed care plan or health care provider.
3. Complete and mail back all forms quickly. When you receive your paperwork from Medicaid, don’t delay. Fill out the forms and return them to the listed address as soon as possible. Most Medicaid enrollees will have 30 days to return their redetermination paperwork, but in some cases, a longer period is allowed. Your letter will clearly state the deadline by which you need to return the completed forms.

I found out I’m being dropped from Medicaid. What now?

If you receive a notice that your Medicaid benefits are being terminated, first of all, don’t panic. You have options that can help you avoid lapses in your health care coverage. We’ve outlined them below.

1. Transition to Medicare

If you turned 65 during the pandemic and did not transition to Medicare because you thought you were covered under Medicaid, it’s not too late—even if you’re outside the Medicare Open Enrollment Period. The Centers for Medicare & Medicaid Services (CMS) has set up a new special enrollment period (SEP) that allows people that are terminated from Medicaid to enroll in Medicare and get coverage for the next month or retroactively. Individual that lose Medicaid coverage have 6 months to utilize this SEP. To enroll in Medicare, you must contact the Social Security Administration at 1-800-772-1213 or visit their website.

It is possible to have both Medicare and Medicaid—this is called being “dual eligible.” Currently, 12 million people are dual eligible, which accounts for more than 15% of all Medicaid enrollment.² If you are dual eligible, your Medicare coverage will continue during the Medicaid unwinding process. However, you may be disenrolled from Medicaid if you don't complete and return the necessary paperwork to prove you still qualify for the program. This could result in losing Medicare premium assistance through the Medicare Savings Programs (MSPs). In some cases, removal from Medicaid could also mean you no longer qualify for special Medicare Advantage plans for dual eligible individuals (e.g., Dual Eligible Special Needs Plan, or D-SNP).

What if you need help transitioning from Medicaid to Medicare? Ann Kayrish, Senior Program Manager for Medicare at NCOA, recommends visiting the State Health Insurance and Assistance Programs (SHIPs) website. When you get there, type in your ZIP code or city and state in the search bar at the top of the page. SHIPs are federally funded organizations that provide free, unbiased assistance Medicare beneficiaries and their families.

“We want to ensure that individuals 65 and over who are losing Medicaid coverage during the unwinding period know where to turn to enroll into Medicare—and where to get answers to their Medicare questions,” Kayrish said.

2. Reapply for Medicaid

If you've been notified you no longer qualify for Medicaid, but you believe that's not the case, you can reapply for the program. You can also reapply if you did not complete all the steps required for renewal (and you advise your state within 90 days of coverage termination). There’s no limit on how many times you can reapply for Medicaid benefits.

3. Enroll in employer-sponsored coverage

If you're still working, you may qualify for affordable health care coverage through your employer. You must enroll in an employer-sponsored plan within 60 days of losing your Medicaid coverage—or you’ll have to wait until your employer's annual open enrollment period.

4. Find a plan through the ACA marketplace

If you’re under 65 and your state uses HealthCare.gov, losing Medicaid due to the PHE unwinding will qualify you to seek coverage through the Affordable Care Act (ACA) Health Insurance Marketplace during a special enrollment period. If you meet household income requirements, you may qualify for a premium subsidy that lowers the monthly costs of your ACA plan.

What if I disagree with the decision to stop or change my Medicaid coverage?

If you think your Medicaid benefits were terminated or reduced due to a mistake, you have the right to an appeal (or “fair hearing”). The notice of benefits termination you receive in the mail will have information on how to appeal your state’s decision.

What’s the bottom line? Be aware of the changes happening to Medicaid, how it may affect your benefits, and what you need to do to prepare.

"Many older Americans and people with disabilities have come to rely heavily on Medicaid during the pandemic," explained Kayrish.

While you may not be able to prevent a loss of benefits, there are steps you can take to ensure you continue to have health care coverage no matter what," Kayrish said.

Sources

1. Kaiser Family Foundation. How Many People Might Lose Medicaid When States Unwind Continuous Enrollment? April 26, 2023. Found on the internet at https://www.kff.org/medicaid/issue-brief/how-many-people-might-lose-medicaid-when-states-unwind-continuous-enrollment/

2. Centers for Medicare &. Medicaid Services. Seniors & Medicare and Medicaid Enrollees. Medicaid.gov. Found on the internet at https://www.medicaid.gov/medicaid/eligibility/seniors-medicare-and-medicaid-enrollees/index.html