Preventing the “Unwelcome Mat” Effect: Ensuring Eligible Kids Remain Covered

One of our biggest concerns heading into the unwinding has been children experiencing gaps in health care coverage, especially as a result of losing coverage despite remaining eligible. As my colleague Elisabeth Wright Burak detailed a few weeks ago, these fears are already coming true in at least one state. Later this week, most states will have begun terminating enrollees for procedural reasons, so it is more important than ever to focus on ensuring that eligible children remain covered.

Across states, child eligibility is higher than the income eligibility limits for parents; the median child eligibility limit is 255 percent of the federal poverty line ($5,283 per month for a family of three) compared to 37 percent ($767 per month) for parents’ in non-expansion states and 138 percent FPL ($2,859 per month) for parents in expansion states. As you can see, the gap between eligibility levels is even greater in non-expansion states. For example, in my home state of Alabama, children with a household income of 317 percent or less qualify for Medicaid or CHIP but their parents are only eligible if their income is at or below 18 percent FPL ($373 per month!!).

It’s easy to see why families might be confused by the different eligibility guidelines for adults and children. When a parent receives a message that they are no longer eligible, many may assume their child is no longer eligible.  But the fact is: Even if a parent isn’t eligible for coverage anymore, their child will likely remain eligible for Medicaid or CHIP. This key message needs to be emphasized, underscored and shouted from the rooftops in order to prevent what we call the “unwelcome mat” effect from leading to more uninsured children. This is the opposite of the “welcome mat” effect that researchers have documented showing that children are more likely to be covered if their parents have health coverage. The “unwelcome mat” effect would cause eligible children to lose coverage when their parents lose coverage and we need an all-hands-on-deck approach to counter this effect and help families to keep their eligible children connected with health coverage.

Source: Tricia Brooks et al., “Medicaid and CHIP Eligibility and Enrollment Policies as of January 2023: Findings from a 50-State Survey” (Georgetown University Center for Children and Families and Kaiser Family Foundation, March 2023).

Last week, Tricia Brooks highlighted the need for additional outreach, especially to families. This need is further underscored by the fact that despite all of the communications toolkits developed by states and enrollee outreach that has been conducted, I have yet to see any materials from any state directed toward parents. Or any messaging that stresses that renewal forms should be returned even if parents don’t think they are eligible since their child likely will be. CMS did indicate on its Unwinding webinar series last week that new messaging and resources targeted to families were forthcoming so there should be some materials states and stakeholders can begin using. However, more direct communication and outreach will likely be necessary, which is where frontline organizations like providers, direct assistance organizations, and schools (just to name a few) can play a critical role.

Medicaid and CHIP play a vital role in the lives of children across the country. Over half of the nation’s children receive their health care coverage through Medicaid/CHIP. And ten states have 60 percent or more of all their children enrolled in the programs, four of which are non-expansion states. While clear messaging to parents is needed in all states, it is especially important in non-expansion states where, as highlighted earlier, the difference between child and parent eligibility are the greatest. Recent estimates from the Congressional Budget Office show what is at stake for kids — predicting that child Medicaid enrollment will decline by 4.7 million over the next three years.

Health coverage is essential for children’s healthy development, especially during the earliest years of life. Even short gaps in coverage for children can result in delayed care, unaddressed medical conditions like asthma, or families incurring significant out-of-pocket costs or medical debt. Ensuring eligible children remain enrolled in Medicaid is critical to their ability to access necessary services and thrive in school and beyond.

We have emphasized that the unwinding requires an “all-hands-on-deck” approach, with states, stakeholders, enrollees, health plans, providers and others involved in the process. Even in the states that have taken this approach to heart, the littlest voices have often not been a focus during the preparations for the unwinding, or have not at least received the necessary targeted attention. More must be done across states and across the board to get the message to parents that their children are likely still eligible for coverage, and hopefully prevent further unnecessary coverage losses for Medicaid’s youngest enrollees.

[Editor’s Note: This is the 35th blog in the Unwinding Wednesday series. For more information, visit our PHE Unwinding resource page where you’ll find other blogs in this series, reports, webinars and the 50-state tracker.]

Allexa Gardner is a Research Fellow at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.