Policy Landscape

Medicaid is the backbone of the nation’s health care system providing coverage to those for whom private insurance is not available or affordable and is now the primary coverage source (along with CHIP) for America’s children. Medicaid covers approximately 83.5 million people (including more than 34.2 million children) — a 31 percent increase since prior to the COVID-19 pandemic.[4] This increase in enrollment reflects a federal protection (“continuous coverage”) that has been in place since March of 2020 whereby states cannot disenroll anyone from Medicaid involuntarily in exchange for an increase in the federal Medicaid matching rate. As a consequence of the Consolidated Appropriations Act,[5] this federal protection will lift gradually on April 1, 2023. Eligibility will have to be checked for all 83.5 million people enrolled in Medicaid and approximately four million children whose coverage is financed by CHIP but provided through Medicaid.[6] States have until May 2024 to complete this process — it is likely however that some states will act more quickly. This is commonly referred to as the “Medicaid unwinding.”

In recognition of the risk of children becoming uninsured, the Consolidated Appropriations Act requires states to provide 12 months of continuous Medicaid and CHIP eligibility to children under age 19 beginning on January 1, 2024 if they do not already do so. Continuous eligibility, which is an existing state option, ensures that parents who take on extra shifts, receive a raise at work, or have seasonal employment do not risk losing their child’s Medicaid or CHIP coverage. Currently 17 states and the District of Columbia do not have continuous eligibility for Medicaid or CHIP for any children with additional states providing continuous eligibility only in one program or only for some children. (See Figure 1.) Immediately implementing this provision for all children as unwinding takes place would be highly beneficial for children; otherwise, there will likely be a gap in coverage before this provision becomes effective. This continuous eligibility requirement does not apply to parents or other adults leaving low-income families exposed to unpaid medical debt and health care needs.

With the majority of the children in the United States receiving their health insurance through Medicaid today, children have much at stake during the unwinding. Because the structure of public coverage differs for children and adults, policymakers must consider the needs of children separately. Researchers have consistently projected that millions of people will lose Medicaid during this process, many of whom will become uninsured.[7] With respect to children, because Medicaid/CHIP income eligibility levels are much higher than for adults (See Figure 2), there is widespread agreement that the vast majority of children losing coverage will remain eligible for Medicaid but lose coverage due to procedural errors of one sort or another.

Prior to the continuous coverage protection taking effect, children eligible for Medicaid would churn off and on coverage due to bureaucratic barriers, confusing renewal notices or notices getting lost in the mail, technology hiccups, or slight income fluctuations. Children with parents who are hourly employees, work seasonal jobs, or work more than one part-time job are particularly susceptible to losing coverage as their family income is more likely to fluctuate and temporarily put them over the Medicaid or CHIP eligibility levels. The continuous coverage protection nearly eliminated churn, protecting children from gaps in health coverage.

A report from federal researchers finds that 72 percent of children losing Medicaid will remain eligible and that Latino and Black children and families are at greater risk of inappropriately losing coverage.[8] We have previously projected that the uninsured rate for children could easily double especially in states that do not take adequate time and care with the process, are less adept at using electronic data sources in their Medicaid eligibility system, and/or have more complicated and onerous public coverage features for children—such as separate CHIP programs which include premiums or more frequent income checks.[9]

This paper examines Medicaid/CHIP enrollment growth during the continuous coverage period, which states have seen the most substantial growth, and where children’s enrollment has constituted a larger share of the growth. Finally, we look at the percentage of children now covered by Medicaid/CHIP in each state. Unfortunately, this data source does not allow us to disaggregate the data by race, ethnicity, age, or geography. Recent estimates from the National Health Interview Survey underscore the enormity of the stakes for families of color—with 68% of Black children and 60% of Latino children now enrolled in public coverage.[10]

Background:

Children have the highest rate of poverty in the United States, compared to other age groups.[11] This, along with the more generous public coverage levels that exist for children through Medicaid and CHIP and the fact that employer-sponsored coverage is far more expensive for families than individual workers, among other factors, and the continuous coverage requirement have resulted in Medicaid being today the single largest source of coverage for children—with 54.3 percent of all children enrolled in Medicaid and CHIP.[12]

During the early days of the COVID-19 pandemic, Congress enacted a number of relief bills to address the public health and economic crises the nation faced. One of the first such bills, the Families First Coronavirus Response Act (FFCRA), included enhanced federal funding for the Medicaid and CHIP programs. To qualify for the extra 6.2 percentage points in the federal Medicaid match rate, states have been required to meet specific maintenance of effort provisions. The most important of these provisions prohibited states from disenrolling anyone involuntarily who was enrolled in Medicaid on or after March 18, 2020. This provision is referred to in different ways—most commonly as the Medicaid “continuous coverage requirement” or the Medicaid disenrollment freeze. This policy also applied to CHIP children enrolled in Medicaid, but not to CHIP children enrolled in separate state programs.

There is clear evidence that the Medicaid continuous coverage requirement has been an extremely important policy tool to avoid increases in the number of uninsured people during the pandemic. The number of uninsured people generally rises during economic downturns as people lose their jobs and health insurance, but national survey data suggest that the uninsured rate actually went down.For children the Medicaid protections have been key to reversing coverage losses of the period prior to the pandemic and stabilizing the uninsured rate.[13]

Prior to the pandemic, children from low-wage working families, particularly those in families of color, often experienced periods of uninsurance in part due to administrative churn.[14] Families may have difficulty completing the renewal process successfully if they have language barriers or inadequate support throughout the process. Even “returned mail” can and does lead to a child losing their health insurance coverage in “normal” times.[15] Given the considerable housing instability for low-income families and changes in employment patterns and child care due to the pandemic, there has likely been a great deal of movement and changes for these families over the past two years.[16] Many of these families are likely to have outdated addresses and information in the Medicaid eligibility systems.

Any gap in coverage is problematic for children and families as they are exposed to large medical bills in the event of a child becoming sick or breaking a bone. It is even more challenging for families with children who have chronic conditions like asthma or complex medical needs that require regular access to health care services. Uninsured children are also less likely to receive needed primary and preventive care for conditions such as asthma that can worsen and land a child in the emergency room. While children are not expensive to cover, they need access to regular preventive and primary care to grow and thrive as states begin to unwind.

What has happened to Medicaid enrollment?

We examined federal administrative data on Medicaid and CHIP enrollment growth from February 2020 to August 2022, the most recent month for which consistent data from nearly all 50 states and the District of Columbia were reported to the Centers for Medicare and Medicaid Services at the time of this writing.[17] Specifically we looked at total enrollment growth, child only enrollment growth, and analyzed the share of enrollment growth that was attributable to children during this period. Finally, we examine the percent of children overall in each state enrolled in Medicaid/CHIP as of August 2022.

Unsurprisingly, the top two states with the largest total enrollment growth are Oklahoma and Missouri as both of these states implemented the Affordable Care Act’s Medicaid expansion for low-income adults as a result of voter-backed referenda during the period. (See Appendix Table 1.) While all states experienced enrollment growth during the period, growth rates (excluding Oklahoma and Missouri) ranged from a high of 57.5 percent in Indiana to a low of 16.7 percent in Connecticut. Varying growth rates are likely the result of many factors including differential economic impacts of the pandemic, state policy choices such as suspending premiums or other barriers like periodic income checks during the COVID-19 public health emergency, and, most especially, the level of pre-pandemic burdens imposed by states associated with renewing coverage during “normal” times which results in higher or lower shares of children and families eligible but not enrolled in Medicaid/CHIP.

Which states have seen the largest growth in children’s Medicaid?

Child enrollment growth in Medicaid and CHIP over the period tended to grow most quickly in states that had higher uninsured rates prior to the pandemic. This is to be expected since the majority of uninsured children prior to the pandemic were eligible but not enrolled in Medicaid and CHIP.[18] The protective effect of the continuous coverage requirement has been more valuable to families in these states because they tend to erect more barriers to enrollment and retention of public coverage and/or have lower income eligibility levels.

Table 1 shows the top ten states with respect to Medicaid and CHIP child enrollment growth which ranged from a high of 44.8 percent in Indiana to a low of 7.7 percent in Vermont (see Appendix Table 2 for all states). States that had lower Medicaid and CHIP participation rates at the start of the pandemic had more “room to grow” in child enrollment and thus would be expected to see higher enrollment growth. Indiana and Wyoming are good examples of this with participation rates for children eligible for Medicaid far below the national average prior to the pandemic.[19]

We also examined the share of enrollment growth overall that is attributable to children. The top ten states with the largest share of enrollment growth attributable to children are shown in Table 2. All of these states cover far fewer non-pregnant or non-disabled adults because they have not accepted the ACA’s Medicaid expansion—except for Indiana. In states that have not expanded Medicaid, children constitute 53 percent of Medicaid enrollment growth as compared to expansion states where children constitute about one quarter of enrollment growth. In every state, policymakers should consider the needs of children separately due to the fact that their eligibility levels are higher so they are most likely to remain eligible even if their parent’s income is over the adult eligibility guidelines. In states that have seen a higher share of child enrollment growth particular attention must be given to bureaucratic barriers, inertia, or indifference that may result in eligible children losing coverage. In Medicaid in non-expansion states, children are far more likely to remain eligible for Medicaid or CHIP than their parents and that large disconnect between eligibility levels could cause confusion for parents, leading to children losing their coverage.

Which states have the largest share of all children covered through Medicaid and CHIP today?

In 30 states and the District of Columbia, more than half of their child population is enrolled in Medicaid and CHIP. (See Appendix Table 4.) Ten states and DC have more than 60 percent of their children insured by Medicaid and CHIP. (See Table 3.) Access to care for children could be severely disrupted in these states if the Medicaid unwinding process does not go well.

Conclusion

Medicaid is now the single largest source of health coverage for children in the United States.  While their parents may no longer meet the Medicaid income eligibility guidelines, children are still likely to be eligible for Medicaid or CHIP due to higher child income eligibility standards. A separate study found that an estimated 3.2 million children under 18 currently enrolled in Medicaid will become eligible for separate CHIP programs—which is less than 10 percent of children currently enrolled in Medicaid.[20]

Ensuring that children and their families navigate successfully to these new sources of coverage will be challenging; an even greater challenge will be retaining eligible children. These children are at grave risk of losing coverage inappropriately in states that do not handle the renewal process with the utmost care. In states that cover few non-pregnant, non-disabled adults, the Medicaid unwinding process will primarily pose risks to children, very poor parents, and postpartum women.

Coverage losses will be more likely to happen in states that do not reduce bureaucratic hurdles and fail to utilize effective strategies to reach and support parents through the renewal process with a message that their child is likely still eligible for public coverage. States must also work with trusted messengers to reach communities of color who are more likely to lose coverage inappropriately. The potential impact of the unwinding process could double the nation’s uninsured rate for children if not handled well, and worsen existing racial disparities in access to health coverage and care. Families with high levels of recent residential instability, limited English proficiency, or limited internet access are at greater risk of losing coverage.

Coverage losses can be mitigated and gaps in coverage avoided by early state adoption of the soon to be required 12 months of continuous Medicaid and CHIP eligibility for children in states that have not yet implemented it for children of all ages in both Medicaid and CHIP.  State leaders in all states must commit to being transparent with data on eligibility denials and call center statistics and halt the process if large numbers of children and adults lose coverage for procedural reasons, call centers become overwhelmed, or other clear warning signs emerge. A major challenge lies ahead, but states that take their time, work closely with community partners, extend continuous coverage periods for children (which can be even longer than 12 months with approved Section 1115 authority), and dedicate the needed resources to the process could avoid large coverage losses and even reimagine their systems for a brighter future for children.

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 Appendix

View Methodology 

[1] Centers for Medicare & Medicaid Services (CMS), “August 2022 Medicaid and CHIP Enrollment Trends Snapshot,” available at https://www.medicaid.gov/medicaid/national-medicaid-chip-program-information/downloads/august-2022-medicaid-chip-enrollment-trend-snapshot.pdf. As CMS notes, this number reflects only 49 states and DC and excludes Arizona, which does not report a child enrollment breakout.

[2] J. Alker and T. Brooks, “Millions of Children May Lose Medicaid: What Can Be Done to Help Prevent Them from Becoming Uninsured?” (Georgetown University Center for Children and Families: February 2022), available at https://ccf.georgetown.edu/2022/02/17/millions-of-childrenmay-lose-medicaid-what-can-be-done-to-help-prevent-them-frombecoming-uninsured/.

[3] Office of the Assistant Secretary for Planning and Evaluation (ASPE), “Unwinding the Medicaid Continuous Enrollment Provision: Projected Enrollment Effects and Policy Approaches” (Office of the Assistant Secretary for Planning and Evaluation, August 2022), available at https://aspe.hhs.gov/reports/unwinding-medicaid-continuous-enrollment-provision

[4] CMS, op. cit. CHIP enrollment has increased 4.7% during the same period; children in CHIP Medicaid programs are protected by the continuous coverage protection; children in “separate” state CHIP programs are not.

[5] For more information, see Edwin Park et al., “Consolidated Appropriations Act, 2023: Medicaid and CHIP Provisions Explained” (Georgetown University Center for Children and Families: February 2022), available at https://ccf.georgetown.edu/2023/01/05/consolidated-appropriations-act-2023-medicaid-and-chip-provisions-explained/.

[6] Georgetown University Center for Children and Families calculation based on the 6.9 million children enrolled in CHIP as of August 2022 (CMS, op. cit). Approximately 61% of these children are in CHIP-funded Medicaid, so we applied this ratio for an estimate. See MACPAC, “Exhibit 32. Child Enrollment in CHIP and Medicaid by State, FY 2021 (thousands)”, available at https://www.macpac.gov/wp-content/uploads/2022/12/EXHIBIT-32.-Child-Enrollment-in-CHIP-and-Medicaid-by-State-FY-2021-thousands.pdf.

[7] ASPE, op. cit. See also M. Buettgens and A. Green, “The Impact of the COVID-19 Public Health Emergency Expiration on All Types of Health Coverage” (Urban Institute: December 2022), available at https://www.urban.org/sites/default/files/2022-12/The%20Impact%20of%20the%20COVID-19%20Public%20Health%20Emergency%20Expiration%20on%20All%20Types%20of%20Health%20Coverage_0.pdf;  Alker and Brooks op. cit.; and E. Williams, R. Rudowitz, and B. Corallo, “Fiscal and Enrollment Implications of Medicaid Continuous Coverage Requirement During and After the PHE Ends” (Kaiser Family Foundation: May 2022), available at https://www.kff.org/medicaid/issue-brief/fiscal-and-enrollment-implications-of-medicaid-continuous-coverage-requirement-during-and-after-the-phe-ends/.

[8] ASPE, op. cit.

[9] Alker and Brooks, op. cit.

[10] R. A. Cohen and A. E. Cha, “Health Insurance Coverage: Early Release of Estimates from the National Health Interview Survey, January–June 2022” (National Center for Health Statistics: December 2022), available at https://www.cdc.gov/nchs/data/nhis/earlyrelease/insur202212.pdf.

[11] C. Benson, “U.S. Poverty Rate Is 12.8% but Varies Significantly by Age Groups” (U.S. Census Bureau: October 2022), available at https://www.census.gov/library/stories/2022/10/poverty-rate-varies-by-age-groups.html.

[12] Georgetown University Center for Children and Families analysis of Centers for Medicare & Medicaid Services (CMS) State Medicaid and CHIP Applications, Eligibility Determinations, and Enrollment Data. CCF uses updated data whenever possible. Arizona does not report a child enrollment number in the CMS data, so CCF substitutes state administrative data for child enrollment in all months. CCF also substitutes Indiana state administrative data for both child and total enrollment in August 2022 due to recent changes in the state's reporting to CMS. More information on data sources and methodology is available online.

[13] J. Alker, A. Osorio, and E. Park, “Number of Uninsured Children Stabilized and Improved Slightly During the Pandemic” (Georgetown University Center for Children and Families: December 2022), available at https://ccf.georgetown.edu/2022/12/07/number-of-uninsured-children-stabilized-and-improved-slightly-during-the-pandemic-2/.

[14] A. Osorio and J. Alker, “Gaps in Coverage: A Look at Child Health Insurance Trends” (Georgetown University Center for Children and Families: November 2021), available at https://ccf.georgetown.edu/2021/11/22/gaps-in-coverage-a-look-at-child-health-insurance-trends/.

[15] M. Hawryluk, “Return To Sender? Just One Missed Letter Can Be Enough To End Medicaid Benefits,” National Public Radio, November 1, 2019, available at https://www.npr.org/sections/health-shots/2019/11/01/774804485/return-to-sender-just-one-missed-letter-can-be-enough-to-end-medicaid-benefits.

[16] K. Wong, “Housing Insecurity and the COVID-19 Pandemic,” (Consumer Financial Protection Bureau: March 2021), available at https://files.consumerfinance.gov/f/documents/cfpb_Housing_insecurity_and_the_COVID-19_pandemic.pdf.

[17] CMS State Medicaid and CHIP Applications, Eligibility Determinations, and Enrollment Data, op. cit.

[18] J. Haley et al., “Uninsurance Rose among Children and Parents in 2019: National and State Patterns” (Urban Institute: July 2021), available at https://www.urban.org/sites/default/files/publication/104547/uninsurance-rose-among-children-and-parents-in-2019.pdf.

[19] Georgetown University Center for Children and Families, Children’s Health Care Report Card, available at https://kidshealthcarereport.ccf.georgetown.edu/states/indiana and https://kidshealthcarereport.ccf.georgetown.edu/states/wyoming.

[20] Buettgens and Green, op. cit. Some children will be eligible for employer-sponsored insurance or subsidized Marketplace coverage but this study does not break these numbers out by age.