The Centers for Medicare and Medicaid Services (CMS), Texas’ partner in administering Medicaid and Children’s Health Insurance Program (CHIP), released a Final Rule to better streamline the application, eligibility determination, enrollment, and renewal processes it regulates across states and public insurance coverage types. Overall, the goal of these policies is to reduce the “churn” of people moving on and off insurance coverage due to issues with paperwork, agency processes, and gaps in data-sharing. This rule is a collection of tweaks that will have enormous impacts on all Texans — even those who have other kinds of insurance.
Medicaid is a cooperative state and federal program, meaning CMS and the Texas Health and Human Services Commission (HHSC) set the policies for the program while the state and federal governments fund it. Though CHIP and Medicaid are separate programs in Texas, changes to CHIP policy also require cooperation between the states and federal government. In some cases, changes to federal policy — like this Final Rule — create options and flexibilities for states. Other times, CMS policy requires states to make changes.
A unique aspect of this Final Rule — and the basis for all of the policy changes in it — is a reminder that preserving the “integrity” of these programs does not just mean being vigilant about fraud and abuse; it means stewarding the program in a way that ensures people we know are eligible (or should know based on data we already have) are enrolled in and can keep their coverage.
This Final Rule requires that changes be made to the systems and processes states use to determine whether a person is eligible or not for Medicaid and CHIP. The highly anticipated — if belated — policy changes were strongly encouraged by Every Texan and our partners, and even largely supported by HHSC as well.
Medicaid
The fallout of Medicaid unwinding in states like Texas clearly shows the connection between eligibility and enrollment policies and access to coverage and care. As of March of this year, 1.37 million Texans — mostly kids — have lost their access to health care without having their eligibility determined. Several policies in the new CMS rule will help people enroll in and better retain their Medicaid coverage because states will lose the ability to opt out of commonsense administrative fixes.
States must now use a specific procedure when mail is returned and it’s clear the notice did not reach the intended person or family. This includes checking other sources, like the United States Post Office, for changes of address as well as using text messages and emails to reach Texas families. HHSC began reporting its use of emails, texts, and robocalls to reach people as they approached the end of the unwinding process, and we hope the agency continues to employ these methods to complete successful redeterminations and future enrollments.
Federal law now requires states to use certain “ex parte” data in determining eligibility, which includes income eligibility. Ex parte data is information the state or federal agency already has access to without needing more information or evidence from the person or family applying for Medicaid coverage. In many states, there is a long list of data the state Medicaid agency can use to determine eligibility automatically so no one has to send in a paper packet or pay stubs. This, in turn, makes it less likely for applications to get denied, as there’s less manual mistake opportunity. In Texas, the list of data that can be used for ex parte renewals is comparatively short, and it’s only as long as it is now because the state is allowing some flexibility during unwinding. This is why Texas has the lowest ex parte renewal rate in the country and also why HHSC staff have to work overtime to do manually what most states handle automatically.
The rule also sets a new minimum response time states must allow for people trying to enroll in or remain on Medicaid coverage. In cases where HHSC needs more information from a person or family trying to enroll, Texans will now have 15 days to respond to requests. Current Texas policy gives 10 days to respond. In order to ensure fewer people lose coverage we know they are likely eligible for, there is now a 30-day window for people to respond to agency information requests during an eligibility redetermination.
Other policies in the rule are designed to enable better ex parte renewal rates by improving record and data storage, retention, and sharing. This should reduce the administrative burden on agencies as well as the likelihood that a person or family will have to provide more information as a part of their application. Ideally, state agencies will now have better information and systems to complete eligibility determinations.
The Children’s Health Insurance Program (CHIP)
Texas ranks last in the United States for children’s insurance coverage rates. Key pieces to closing this coverage gap are a better system for eligibility determination, easier enrollment, and ways to maintain CHIP coverage. Since CHIP covers children* from families with higher incomes versus the children covered by Medicaid, there have historically been allowances for more restrictions on access and use of CHIP coverage compared to Medicaid. These barriers to access have long been controversial because the enrollees we’re talking about are children and because many of these types of policies have previously been banned by different laws across other types of insurance. The new rule gets rid of several such restrictions, including:
- Arbitrary waiting periods before coverage begins after other coverage is lost (something that no other health insurance program requires).
- Lockouts from the program — previously, if a family did not pay their share of costs on time, the child covered by CHIP could get locked out of their health coverage.
- Annual and lifetime limits. These are caps on what a CHIP plan would spend on a child enrolled on either an annual or lifetime basis (meaning the duration of the child’s coverage on that plan) regardless of whether a child had more health needs. A ban on these types of limits is a popular provision of the ACA, and we are glad to see this same protection applied to CHIP plans.
Texas currently has a three-month waiting period for children who lose their coverage and want to apply for CHIP coverage that will now have to be phased out. Texas does not currently use lockouts but does have a cap on what it will spend on a child’s dental care, though a family can request these caps be waived in special circumstances. Texas also cuts kids off from CHIP coverage if their family fails to pay a fee when trying to enroll.
The rule also requires states to create and bolster the process for transitioning children between Medicaid and CHIP when there are changes to income in order to prevent coverage termination. These new processes include a single notice delivered to a household letting the members know who is or could be eligible for what kinds of coverage, including ACA Marketplace coverage and tax credits. Kids shouldn’t lose health coverage just because a rise or decline in family income makes them ineligible for Medicaid or CHIP when Texas has data to show they are eligible for the other program. Coverage loss is fairly common, and it has become a larger issue in many states during the unwinding because there has been no federal requirement for states to create a good, predictable process for transitioning kids between coverage types.
*CHIP also covers some non-minors under certain circumstances, such as some pregnant adults.
People Eligible for Both Medicare and Medicaid
Though Medicare is a federal program, some state eligibility and enrollment processes can impact eligibility and ease of access to Medicare benefits for many Texans with lower incomes and/or disabilities, as a person can be “dually-eligible” for both Medicaid and Medicare (there is no way to qualify for Medicaid based on Medicare eligibility, however). The new rule ensures barriers to enrollment, such as an interview requirements, multiple eligibility checks in a year, and waiting periods, are not applied to programs that do not factor the income and assets limits of an enrollee into the eligibility determination.
In the same way CHIP, with its higher income eligibility limits, has made enrollees jump through more hoops to enroll and stay enrolled, other groups whose incomes are not a factor in applying for coverage have also faced a daunting process to sign up. These groups are low-income seniors, people with disabilities, and people with medically complex care needs. In these cases, higher income eligibility or the absence of an income check has led to more requirements, such as in-person interviews, designed to make people prove they qualify for coverage the state already knows they should have. Unsurprisingly, these extra steps often translate to barriers to coverage and access. Elimination of these barriers in the Final Rule is especially important for these populations, as Medicaid and Medicare sometimes pay for different types of care in specific settings. In these cases, losing Medicaid eligibility can have a major impact on a person and their family. Removing these barriers to Medicaid coverage is a vital step to ensuring all Texans have access to all of the types of coverage they need.