Implementing American Rescue Plan’s 12-month Postpartum Medicaid Coverage: Federal and State Actions

Federal matching funds for the American Rescue Plan Act’s new state Medicaid option to provide 12 full months of postpartum coverage won’t be available *officially* to states until April 2022.

(Say Ahhh! Readers know that the Families First Coronavirus Response Act requires states to keep all Medicaid beneficiaries enrolled, including postpartum women, so no coverage gaps should be occurring during the past year or so for those who delivered newborns after March 18, 2020.)

But as with any change, the months between now and then are important for CMS and states to plan ahead to ensure that as soon as the extended coverage begins, postpartum women and their newborns get what they need to be on the best path for success. The maternal and infant mortality crises were plaguing the nation well before COVID, and the pandemic has only served to make things worse, especially for Black and Brown families. Making maternal and infant well-being a priority as we build back from the COVID-19 pandemic should be a no-brainer.

So what do federal and state policymakers need to do now to take full advantage of this option?

Approach the postpartum extension and ACA Medicaid expansion as a package deal. While there is an urgent need to extend postpartum coverage to a full year after birth, it doesn’t make up for a lack of health coverage before pregnancy. The links between Medicaid expansion and maternal health are well-documented, and show the importance of coverage for women, before, during, and after pregnancy. None of the 12 non-expansion states can come close to declaring a maternal health “win” by taking on the new postpartum option if they don’t also expand Medicaid to future parents in the coverage gap.

Now is the time to expand Medicaid if state lawmakers are genuinely interested in supporting new moms and babies. The American Rescue Plan makes the financial incentives for expansion even harder to pass up. CMS should encourage non-expansion states to pursue these together wherever possible as they issue guidance or assist states on adopting the postpartum extension. And they can encourage states that haven’t already expanded Medicaid to take advantage of the new incentives to expand, ensuring that people have continuous access to health care regardless of pregnancy status.

Run the budget numbers. State lawmakers can take steps to identify and allocate the state funds that will be needed to pull down the federal match and begin extended postpartum Medicaid coverage as soon as the federal matching funds become available on April 1, 2022. Depending on state budget rules, that can happen as soon as this year. This toolkit from Manatt Health and the Equitable Maternal Health Coalition offers a good framework for estimating the cost of extended coverage. Several states have developed models to estimate how many women might be eligible for extended postpartum coverage. And those 12 non-expansion states would do well to consider that accepting the Medicaid expansion incentives from the American Rescue Plan would free up state matching dollars to extend postpartum coverage too. CMS can help to make that case as well, as they highlight the other Medicaid dollars available to states from the American Rescue Plan, such as increased match for home- and community-based services.

Prepare for State Plan Amendments (SPAs) in time for federal sign off in advance of April 2022. In the past year, more than 25 states have moved to submit 1115 waiver proposals to extend postpartum coverage beyond 60 days for at least some pregnant women, which was the only available pathway to extend coverage. But the American Rescue Plan creates a state plan amendment option for states to extend postpartum coverage for one year to all pregnant women with Medicaid or CHIP pregnant women’s coverage at the time of delivery.

(Stay tuned for more on Say Ahhh! from our waiver-watcher colleagues on the state and federal considerations between a SPA and 1115 waiver applications in the coming days, and the various benefits and drawbacks to each approach.)

For its part, CMS can issue a SPA template, as it’s done in the past for other state plan options, along with guidance and FAQs to ease the path for states even more. A SPA template allows states to fill in the blanks with the necessary details of the policy change rather than craft their own. Guidance should encourage states to take the most expansive approach possible, and warn against 1115 waivers that may leave out pregnant women who could benefit from services such as mental health care and other supports during this consequential period for new families.

Work with agency partners to maximize new federal funds to support new parents and their infants. States are getting a significant amount of new resources from the American Rescue Plan to support low-income families– both directly and indirectly. Given the critical needs of new moms and babies, how can states use new funds strategically to ensure better care and coordination during the high-stakes postpartum period? With gubernatorial leadership, states should use cross-agency children’s cabinets or other structures to identify and target a portion of new public health and other funds that can help families make full use of the care available to them– through care coordination, community health centers, preventive screenings and connections to social services.

CMS should also partner with its sister agencies at HHS— notably the Health Resources & Services Administration (HRSA) and the Centers for Disease Control (CDC) — to encourage and identify ways states can align new health infrastructure and public health investments toward the goal of prioritizing women and babies who will benefit from the postpartum extension. Community health workers, community health centers, mental health and related investments from the American Rescue Plan can support Medicaid’s ability to make the postpartum extension work– ensuring moms and newborns are connected with medical homes, wraparound supports, and get the necessary services they need to thrive within and outside of the health care system.

Lay the groundwork for successful implementation— by getting direct input from families and other stakeholders. Coverage is only as good as its ability to be used. State policymakers should also start engaging key stakeholders– with families at the center– about what will be needed to ensure postpartum women take full advantage of available coverage. What will managed care plans need to do to educate their members about the change? What kinds of network changes may be needed so that new parents can access the full range of postpartum services they need? This includes mental health care, cardiac care, substance use disorder services, physical therapy and services that support the parent and child together.

Implementing the extended postpartum Medicaid and CHIP coverage option will require support at all levels, from state and federal policymakers, health care providers, advocates, outreach and enrollment workers and so many more. While there is much more work to be done to reduce maternal mortality and support the health of parents and infants, the extended coverage is an important step in the right direction.