By Martha Heberlein
As my colleague, Tricia Brooks, noted a few weeks ago, MAGI-based renewals are upon us in many states (save those that have delayed them, which we talked more about in a separate blog). And buried within the ACA is a little-known provision that specifically protects children who were enrolled in Medicaid (but not CHIP kids) from losing coverage.
Specifically, under section 2101(f) of the ACA, Medicaid children who were enrolled as of December 31, 2013, but are found ineligible at renewal as a result of the elimination of disregards, are considered “targeted low-income” children eligible for CHIP coverage for a full year. As such, states will receive the enhanced CHIP match for the health care these children receive.
The one-year extension starts at the time the child’s eligibility is formally renewed, even if that renewal was postponed. However, given the flexibility that CMS has allowed on the delayed renewals, as well as the concerns with renewals more generally, it will be important for advocates to monitor whether these children are given the additional full year of CHIP coverage to which they are entitled and not a shortened renewal period as other enrollees may be subject to.
States have a number of options to implement this provision – including maintaining these children’s eligibility for Medicaid or covering them in a separate CHIP program.
They also have flexibility in the approach to identifying these children, including:
– enrolling all Medicaid children who lose eligibility because of excess income at their first MAGI-based renewal;
– setting an eligibility standard above the Medicaid threshold that would capture these children;
– showing that all these children would qualify under the state’s existing CHIP program; or
– looking on an individual basis at 2013 data to see whether or not the conversion to MAGI-based eligibility impacted eligibility.
In some states, more children may be impacted – such as states that use CHIP funds to expand Medicaid. The ACA explicitly says that these children become eligible for coverage under a separate CHIP program, even in states that don’t have one or only have a very limited one (such as those adopting the fetus option). Understanding the administrative effort to create a separate CHIP program (even one that is a Medicaid “look alike”), CMS gave states the option to continue to provide another year of coverage for these kids in Medicaid.
Additionally, in states with a more limited band of CHIP eligibility above their Medicaid threshold or in the case where infant eligibility is higher, there may be greater cause for concern that not all Medicaid kids are getting this protection.
Prior to the move to MAGI, when determining eligibility, a state often began with gross income and then disregarded certain income, such as $90 for a working parent, and deducted certain expenses, such as childcare, and then compared the result to a net income eligibility standard. In some states for families with two working parents and child care expenses, these deductions could total $8,000 and may be greater than the difference between the Medicaid and CHIP eligibility thresholds. We took a closer look states’ reported (but not verified!) use of disregards to try to tease out where the risk points are.
A quick note – these calculations attempt to take into account the full amount of disregards at the upper end of the Medicaid income threshold. However, not all families would have been eligible for the maximum disregards (for example, a single mother would only qualify for $90 in earnings disregards, compared to a family with two working parents that would qualify for $180 in earnings disregards). And those with lower income, even if qualifying for substantial disregards, still might fall within the Medicaid eligibility window following the conversion. As such, this examination likely overstates the risk for children.
Additionally, the level of worry also depends upon how states choose to implement the protection – for example, we would be more concerned about children losing coverage in a state with a narrow band of eligibility between Medicaid and CHIP and large disregards if the state indicated that all children losing Medicaid would be eligible for CHIP.
One such state is Florida, which has indicated that all children losing Medicaid eligibility will be eligible for its separate CHIP program. Yet infants are covered in Medicaid (to 211%) and not eligible for the state’s separate CHIP program and it’s unclear whether all infants becoming ineligible for Medicaid as a result of the loss of disregards will, in fact, be eligible for CHIP (at 215%).
As renewals move forward, check with your state to see how they’re thinking about it, because even in states that chose a “child-friendly” option, it’s still important to monitor their actions to ensure that this important protection is appropriately implemented. If your state isn’t willing to share, take a look on Medicaid.gov. States are required to submit SPAs detailing their approach to the 2101(f) protection, but last we checked, just 11 states have approved state plan amendments posted (hint – be sure to check all the SPAs posted for your state, as they are sometimes combined), but keep your eyes out for more.
