CMS Takes Swift Action to Require States to Address Medicaid Auto-Renewal Errors and Reinstate Children’s Coverage

We have long feared that large numbers of children were losing Medicaid during the unwinding, essentially by mistake, and the ex parte debacle underscores the fact that this is indeed happening.  As we’ve previously explained, the ex parte issue came to light in August after a CMS investigation found several states were doing automatic renewals using a household standard rather than an individualized one and failing the whole household in the process, even when some members of the household remained eligible. This problem does not only impact children, and it is not the only problem impacting children, but because every state covers children at higher income eligibility levels than parents, children are unquestionably the group that is primarily affected.

While it is often said that “if you’ve seen one Medicaid program you’ve seen one Medicaid program”, that phrase has perhaps harmed the collective understanding that ALL citizen children in the United States living in families with income below 138 percent of the poverty level are entitled to Medicaid coverage regardless of where they live. It seems that IT systems in 30 states, including D.C., were not reflecting this. And every state has income eligibility for children at higher levels through Medicaid and CHIP than for adults.

The Biden Administration has taken swift, decisive, and transparent action to ensure that children’s guarantee to coverage is respected. This is very welcome because the problem would have only gotten worse as unwinding continues. We appreciate the transparency in identifying the 30 states, including DC, that have attested to having their ex-parte systems processed wrong.

Governors must act to protect children and families as Nevada did swiftly last week. Nevada and Pennsylvania are the two states that identified more than 100,000 Medicaid beneficiaries as being impacted by the error. States must reinstate those affected with widespread publicity to inform people that they or their children have Medicaid coverage. States should pause procedural terminations until systems problems are fixed (there may be other systems problems too!). My colleague Tricia Brooks blogged last week about the best mitigation strategies for states to implement while working on system fixes.

As troubling as it is that half a million children have lost coverage by mistake already, that is not where the damage stops. Texas, for example, is not included in this total because it has a more significant problem — automatic renewals are barely happening at all. The state has already terminated between 500,000-750,000 children. Florida and Georgia collectively have also seen hundreds of thousands of children losing Medicaid for procedural reasons rather than because they’ve been determined ineligible, which raises concerns. Both Florida and Texas attested to CMS that they were doing the ex-parte determination process correctly using an individual standard, not a household one. Georgia said that it was doing it wrong and was still assessing the scope of the problem.

Another issue to keep an eye on is that it was expected that large numbers of children losing Medicaid would move to CHIP – but that is not happening either. In states that run separate CHIP programs, where we have data, almost a million children have been disenrolled from Medicaid but CHIP enrollment has only increased by a meager 14,000. 

So today was a good day for children and families who regained coverage, but the challenges of unwinding continue.

Joan Alker is the Executive Director of the Center for Children and Families and a Research Professor at the Georgetown McCourt School of Public Policy.