Getting MAGI Right: Differences in Medicaid and CHIP Add Complexity

Next to the fact that millions of people are gaining health insurance, one of my favorite aspects of the ACA is its transformation of Medicaid – moving Medicaid into a modern era by harnessing technology and tapping trusted sources of electronic data to determine eligibility in real time. Launching a new high-performing eligibility system is challenging, in and of itself, but this modernization comes at the same time states must adopt new MAGI-based eligibility standards.

What is MAGI? It is a new way of counting household size and income, based on tax law, in determining and coordinating eligibility and access to coverage across Medicaid, CHIP and the health insurance Marketplaces. This makeover for Medicaid and CHIP is significant, but to complicate things, the rules between Marketplace eligibility and Medicaid and CHIP are not 100% consistent; certain exceptions apply to Medicaid and CHIP only. These exceptions, along with significant changes in Medicaid/CHIP eligibility, pre- and post-ACA, add complexity to the implementation of MAGI, both in terms of precisely documenting the business rules needed for system development and in training eligibility workers in states where temporary and less automated strategies are used while systems are under development.

A new CCF brief covers the basics of MAGI with a focus on how it impacts Medicaid and CHIP. It identifies specific eligibility policies that have created confusion for eligibility workers, consumers, and the navigators and the certified application counselors who provide enrollment assistance. It is intended to be a tool for eligibility workers and assisters. It even includes a worksheet (appendix B) to help determine household size in Medicaid and CHIP. It also takes stock of areas where additional guidance and training from CMS would help ensure that MAGI is implemented consistency across the states.

Getting MAGI right is critical to assuring that consumers receive the right amount of financial assistance in accessing health coverage. We hope this new brief becomes a helpful tool to states, eligibility workers, and consumer assisters in getting MAGI right.

Watch for a series of Say Ahhh! blogs next week when I dig into some of the trickier aspects of MAGI as it relates to Medicaid and CHIP. A special thanks to the Robert Wood Johnson Foundation for its support of “Getting MAGI Right: A Primer on the Differences that Apply to Medicaid and CHIP” and next week’s MAGI blog series.

The Getting MAGI Right blog series:

Exceptions for Who Counts in the Household for Medicaid and CHIP
An Assisters Worksheet for Determining Household Size in Medicaid and CHIP
When Does Social Security Income Count?
Changes to Income Counting Rules in Medicaid and CHIP
Current Monthly Income vs. Projected Annual Income

Tricia Brooks is a Research Professor at the Center for Children and Families (CCF), part of the McCourt School of Public Policy at Georgetown University.