Among changes to Medicaid tucked in the federal reconciliation bill that passed the U.S. House last week is one that requires participants in the state-federal health plan for the poor to prove they’re eligible every six months.
Wisconsin advocates said Tuesday the provision is likely to reduce Medicaid enrollment — not because people don’t qualify but because of administrative errors and confusion.
Under current state and federal law, people covered by Medicaid must have their eligibility confirmed every year. Eligibility depends on various factors, chief among them household income. People whose Medicaid services are tied to a disability undergo an annual evaluation to determine whether their disability still qualifies them.
“We already do a really good job about making sure that everybody who’s in Medicaid is already eligible to be there,” Tamara Jackson, policy analyst and legislative liaison for the Wisconsin Board for People with Developmental Disabilities, said in an interview.
Checking eligibility more frequently isn’t likely to uncover more people who are enrolled in Medicaid and don’t qualify, Jackson said: “It will lead to a different result because people who are eligible for the program are losing coverage because they didn’t get the paperwork in on time.”
“It’s going to probably result in kicking people off the program — some of it through error and some of it just benign neglect,” said Bobby Peterson, executive director of ABC for Health. The nonprofit is a public interest law firm that assists people navigating the health care system get coverage and address problems such as medical debt.
“It’s part of a blizzard of paperwork to keep people off the program,” Peterson said of the twice-yearly Medicaid eligibility test. “And it’s not necessarily going to be very effective in maintaining program integrity.”
He said Medicaid participants are already required to report changes in their income that could change whether they’re eligible.
“It’s calculated to deter people from staying with the [Medicaid] program,” Peterson said. “It’ll leave more people out and less people covered, more people uninsured.”
Federal fallout
As federal funding and systems dwindle, states are left to decide how and
whether to make up the difference.
With fewer people covered by health insurance, that could lead to “higher rates of medical debt, higher rates of uncompensated care, and then the socialization and redistribution of all that medical debt onto everybody else’s [health care] bill,” Peterson said. “So, it’s a lose-lose proposition.”
The House Republican majority drafted the reconciliation legislation in order to extend tax cuts enacted in 2017 during President Donald Trump’s first term.
The bill’s tax cuts largely benefit higher-income households, according to the Congressional Budget Office. The bill’s spending cuts to Medicaid and other programs, including federal nutrition aid, were included to reduce the tax cuts’ impact on the federal deficit.
In Wisconsin, about 1.3 million people are covered by Medicaid, according to the state Department of Health Services (DHS). About 900,000 are enrolled in BadgerCare Plus, which provides primary health care for families and single adults with incomes below the federal poverty guidelines. Another 250,000 are in one of several Medicaid programs for long-term care for people with disabilities or the elderly, and the rest are in other specialized programs.
The change in how often Medicaid recipients must qualify for the program is just one of many changes in the program under the House reconciliation bill.
In a report produced in late April before the bill’s passage, the state Department of Health Services (DHS) calculated that its proposed Medicaid changes could cost Wisconsin up to $16.8 billion over the next date.
Current federal Medicaid regulations forbid states from determining a person’s eligibility more often than once a year. The House reconciliation bill would effectively override that rule.
A requirement to check every Medicaid recipient’s eligibility twice a year was part of state legislation that Wisconsin Republican lawmakers introduced earlier this year. That bill was met with sweeping criticism at a public hearing in April and has not advanced in the state Legislature.
Supporters of the change have argued that more should be done to reduce fraud in the Medicaid program. But health care experts contend that the Medicaid cuts in the House bill are unlikely to address genuine fraud.
During the COVID-19 pandemic, the federal government temporarily suspended the annual Medicaid renewal requirement to ensure that people had health coverage and would seek medical help if they felt sick.
“Obviously if there’s a public health emergency, you want to maintain connections and access to health care and coverage,” Peterson said. Some people may have been still covered under Medicaid after they were no longer eligible, he added, and some “didn’t even know they had Medicaid or BadgerCare Plus in addition to some private insurance at various times.”
Nevertheless, “it wasn’t like there was wide-scale fraud” in the Medicaid program, Peterson said. “There’s very little evidence of a lot of consumer-related fraud in the program.”