Where do Things Stand with Medicaid Unwinding at the Halfway Point?

KFF’s new research finds that states have reported outcomes for about half of Medicaid renewals nationwide, and so far 16.2 million people have been disenrolled. Meanwhile, our CCF tracker (which accounts for movement on and off the program as well as new enrollment by looking at net enrollment change in each state) shows a 9.37 million net decline nationwide including 3.77 million children.

It is hard to compare all of these numbers because states started their unwinding processes at different times and are reporting data on different timelines. But a few conclusions can be drawn – and some of them are not encouraging:

The number of people being disenrolled from Medicaid is going to be higher than most models projected. Federal researchers at the Office of the Assistant Secretary for Planning and Evaluation (ASPE) projected that 15 million fewer people would be enrolled in Medicaid/CHIP. Researchers at the Urban Institute projected that Medicaid enrollment would decline by 18 million but that 3 million children would move to separate CHIP. KFF’s own projections had a large range to account for the variability of state performance, which is hard to predict, but their best guess was 17 million – and as the authors note this is highly likely to be exceeded.

Procedural terminations are too high; even in states with high rates of automated renewals. Procedural terminations occur when people or families aren’t able to get through the renewal process successfully so no final eligibility determination is made during the required time period. The ASPE report mentioned above projected that 6.8 million people (or around 45 percent of the 15 million) would lose coverage despite remaining eligible for Medicaid. The current reality far exceeds the estimates of procedural terminations: our data shows that 71% of all terminations nationwide are procedural. KFF has had similar findings.

A defect in automated eligibility systems in a majority of states – where ex parte determinations were being made on a household basis not an individual one, a big problem for children because their income eligibility is higher than for their parents – caused approximately half a million people (mostly children) to lose coverage inappropriately. All states that self-identified as having the problem were required to reinstate all affected individuals, and CMS has worked with states to implement systems fixes to address the issue. On a brighter note, state ex parte rates are improving in 42 states as my colleagues recently blogged about. This should help reduce the rate of procedural terminations going forward.

As expected, state variability is making an enormous difference. Our data looks at percent change and total number decline (use the tabs to see the different maps) for everyone and children. The range is huge – with Utah seeing the greatest decline at 31% in overall Medicaid enrollment versus Oregon which has only seen a 1% decline. (Note: Oregon was the last state to begin procedural terminations, starting in October).  KFF data finds Idaho and Utah at the top end of percent decline (see Figure 3). Half of the numeric decline in child Medicaid enrollment comes from just four states – Texas, Florida, California and Georgia. Texas alone accounts for 26% of the overall decline. In fact, the single greatest loss of coverage anywhere for anyone in numeric terms nationwide is among children in Texas where 1.33 million children have been disenrolled – the vast majority for procedural reasons. And of course, North Carolina is seeing Medicaid enrollment increase due to its recent implementation of Medicaid expansion.

Children are not moving to CHIP as expected. The Urban Institute model projected that 3 million children would move to CHIP. With respect to separate CHIP programs, as we have previously written about, this projection is way too high. States with separate CHIP programs are not closing the gap for children losing Medicaid – with CHIP enrollment gains only offsetting 8% of Medicaid declines overall. CHIP enrollment growth in the states we tracked as of December equaled only 187,538.

Enrollment in the federal and state Marketplaces is slower than some expected. Federal researchers at ASPE projected that 2.7 million people — or 18% — would move to subsidized coverage in the Marketplace; Urban researchers had a much lower projection of one million. Through September, as my colleague Edwin park blogged about, about a million people, or a little more than 11%, disenrolled from Medicaid were successfully enrolled in the Marketplace — with record enrollment in the Marketplaces recently announced, this number has definitely gone up. (The latest federal marketplace transition data from October released last week show a surge in marketplace enrollment among those disenrolled from Medicaid, as do new data from 2024 open enrollment, but the cumulative transition rate is still only about 13%, well below the 18% ASPE originally projected)  Edwin will break down these numbers in a future blog, but once we get final unwinding figures, it seems likely that successful transitions to marketplace plans will fall somewhat short of ASPE projections. We don’t yet have data about how many new Marketplace enrollees are children, but they are likely to constitute a relatively small fraction, as they are far more likely to remain eligible for Medicaid or be eligible for CHIP.  We don’t know how many people losing Medicaid coverage are moving to employer-sponsored insurance but we know it’s more likely happening for adults than children. Low-income families are less likely to have an offer of affordable employer-sponsored insurance, and in particular, for family coverage.

Conclusion: Movement on and off Medicaid, including “churn” for eligible populations has always been a feature of the program prior to the pandemic. But what is happening now is at such a huge scale that it is not the same. With so much pressure on the system it is harder to re-enroll; application volume jumped considerably in September and October of 2023 and this is likely to get worse as state systems get more and more backed up. For children, who are much more likely to remain eligible than adults, large declines in Medicaid are very likely to trigger growth in the child uninsured rate as we saw during the years of the Trump Administration. Now more than ever, where a child lives will be determinative of their access to health care and well-being.

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.