Approximately 500,000 individuals who recently lost their Medicaid coverage due to technical issues with computer systems are now regaining their health insurance.
These computer problems, which affected residents in 29 states and the District of Columbia, emerged after the pandemic-era freeze on Medicaid coverage terminations expired earlier this year.
The glitch stemmed from how states determine Medicaid eligibility, especially when considering children’s eligibility based on their parent’s or caregivers’ income levels.
During the pandemic, Medicaid enrollment surged by almost one-third, from 71 million people in February 2020 to 94 million in April 2023.
States employ computer programs to assess whether individuals should be automatically re-enrolled in Medicaid.
If eligibility remains unclear, states attempt to contact individuals through various means, such as mail, phone, text, or email, to gather additional information.
However, if these efforts prove unsuccessful, individuals are dropped from the program through what the Centers for Medicare and Medicaid Services (CMS) describe as a “procedural termination.”
In August, CMS warned that some state computer systems were incorrectly flagging entire households for further information and dropping all family members if no one responded.
This was in contrast to the proper process of reviewing each individual separately and automatically renewing eligibility for children who remain eligible.
CMS requested all states to verify their compliance with federal rules.
Medicaid Coverage Reinstated Amidst Federal Scrutiny Over Computer Glitches
States found to be in violation were instructed by federal officials to reinstate Medicaid coverage for affected individuals retroactively and to halt procedural terminations until their systems were rectified.
Some state Medicaid directors expressed surprise at learning about their incorrect procedures, indicating that it was not apparent that these actions contravened federal regulations.
In West Virginia, fewer than 5,500 children were affected by the problem, and their coverage is being restored.
Meanwhile, New York was more significantly impacted, with approximately 70,000 individuals, including about 41,000 children, inappropriately dropped from Medicaid.
Their coverage will be reinstated for an additional 12 months, beginning shortly.
States like Nevada and Pennsylvania estimated that over 100,000 people might have lost coverage due to their automated renewal system issues.
However, the impact was less severe in some states, such as Nebraska and Massachusetts, with only a few thousand individuals affected.
While improvements to automated eligibility systems are underway, the timeline for implementing these changes varies by state.
Some expect to complete the enhancements by the end of September, while others anticipate it may take several months.
Since the expiration of pandemic-era protections, more than 7 million people have been removed from Medicaid, with variations among states in their approach to coverage termination for those who fail to respond to renewal notices.
This has sparked a debate between those emphasizing adherence to the rules and those advocating for preserving healthcare access for qualified individuals.
Source: AP News