Retroactive Coverage Should Not Be Waived in Florida or Anywhere Else: Florida’s Own Evaluation Makes That Clear

We recently submitted public comments on Florida’s amendment to its Section 1115 waiver which has a medley of requests for the federal government to consider. On the plus side, the state is seeking to extend postpartum coverage from 60 days to 12 months (although it is unclear why they need a waiver). But on the negative side, the state is seeking to continue its waiver of retroactive eligibility in Medicaid for all adults who are not pregnant for the foreseeable future.

This provision was first approved for Florida in 2018 by the Trump Administration, and Florida is not the only state that has such a waiver. Florida’s legislature initially authorized the Governor to seek the waiver for only one year and, as a consequence, CMS required the state to submit an annual letter showing state statutory authority to extend it.

But in 2021, the legislature lifted the annual review requirement; so now the state is asking federal CMS to stop requiring this annual “continuance” letter.

As my colleague Leo Cuello recently blogged about, waiving retroactive eligibility is harmful to people nor is it the kind of thing that should ever be waived — as it is not in line with the objectives of Medicaid.

Waivers should be carefully evaluated as they are supposed to be testing a hypothesis or “demonstrating” something.  In writing our comments on Florida’s request, I carefully read the state’s external evaluation of this provision — conducted by researchers at the U. of Florida, Florida State, and U. of Alabama-Birmingham. It requires a careful read to see why the state’s own evaluation clearly states why this waiver should not be renewed.

The original rationale for Florida’s waiver of retroactive eligibility was primarily to “enhance fiscal predictability.”1 Another hypothesis emphasized in CMS’s 2018 approval was for the state to examine whether beneficiaries, spurred by the loss of retroactive eligibility, would enroll more quickly in Medicaid and access preventive care and non-institutional care.2

The evaluation underscores that there is no evidence that Florida’s change in policy had any impact on changing beneficiaries’ patterns of enrollment for the better or to promote the use of preventive care and sign up for Medicaid before they got sick. According to the state’s evaluators:

The proportions of successful Medicaid renewal before (84.3 percent) and after (85.6 percent) the policy change are very close. Thus, the policy change had minimal effect on the probability of successful enrollment renewal.”3

This is not surprising given that it is highly unlikely that beneficiaries were even aware of the change in policy.

More importantly, the executive summary at p. 3 reports an average increase in medical debt among beneficiaries of 5.9 percent — an average increase of $12 for new enrollees — after retroactive eligibility was eliminated.4 But much later on (and far less prominently) in the report the evaluators note that using an average dollar amount across hundreds of thousands of beneficiaries is not the best way to measure the policy’s impact. Looking at a smaller cohort that actually had incurred medical debt, the evaluators conclude:

“Elimination of retroactive payments for medical care for the three months prior to new Medicaid enrollment is correlated with newly accrued medical debt, with average medical debt increasing by 5.9 percent after implementation of the new retroactive eligibility policy. While the difference was only $12 on average when including all new enrollees, when limiting the analysis to only those new enrollees who accrued some new medical debt, there was an average increase of $85 in medical debt. This likely represents a significant financial burden to Medicaid recipients whose incomes are typically well below the poverty level. This analysis also does not account for fees and penalties that accrue over time if these debts are not paid off in a timely manner; thus, the actual financial burden is likely even larger(p. 24).

It is clear now from the state’s own evaluation that the policy, rather than promoting the objectives of Medicaid, is creating a “significant financial burden” for Medicaid beneficiaries whose incomes are typically well below the poverty line and are more likely to be people of color.  Secretary Becerra must not approve its continuance.

  1. April 27, 2018 amendment submitted by the state of Florida to its Managed Medical Assistance Demonstration, p. 6, accessed at https://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Waivers/1115/downloads/fl/fl-mma-pa2.pdf.
  2. Approval letter from Seema Verma, CMS Administrator to Justin Senior, Secretary, Florida Agency for Health Care Administration, November 30, 2018
  3. Department of Health Outcomes and Biomedical Informatics College of Medicine, University of Florida, Department of Behavioral Sciences and Social Medicine College of Medicine, Florida State University and Department of Health Services Administration University of Alabama-Birmingham Evaluation of Florida’s Managed Medical Assistance (MMA) Program Demonstration: Final Report The Impact of the Waiver of Retroactive Eligibility on Beneficiaries and Providers, January 11, 2021.
  4. Department of Health Outcomes and Biomedical Informatics College of Medicine, University of Florida, Department of Behavioral Sciences and Social Medicine College of Medicine, Florida State University and Department of Health Services Administration University of Alabama-Birmingham Evaluation of Florida’s Managed Medical Assistance (MMA) Program Demonstration: Final Report The Impact of the Waiver of Retroactive Eligibility on Beneficiaries and Providers, January 11, 2021.

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