Medicaid Agencies Should Prioritize New Applications, Continuity of Coverage During COVID-19 Emergency

States facing increased demands on their Medicaid programs due to COVID-19 should prioritize enrolling people in Medicaid and making sure they can stay enrolled. The new Families First Coronavirus Response Act requires states to take some steps in this direction, but they can and should do more.

The COVID-19 emergency is putting intense pressure on state and local agencies that administer Medicaid. They face increased demand as more people seek health coverage and more become eligible for Medicaid because they’re working less or lost their jobs entirely. Meanwhile, some agencies have far less capacity, as they close eligibility offices to achieve social distancing, and many caseworkers take time off to address their own health concerns or perform caregiving responsibilities.

The higher demand and less capacity could mean significant delays in processing new Medicaid applications and renewals for current beneficiaries when people need coverage the most. States should shift staff and other scarce resources toward helping people get and keep coverage and away from actions that would cost beneficiaries their coverage, and they should implement policies to reduce state administrative workloads.

The Families First Coronavirus Response Act should help states do so. It provides an estimated $36 billion in additional federal funding to states. For states to be eligible for the funds, they must abide by a maintenance-of-effort (MOE) provision that’s designed to protect people’s access to health coverage during the crisis. Among other requirements, states are barred from ending coverage during the national public health emergency, except for individuals who voluntarily end their coverage or move out of state.

To comply, while also freeing up resources to process new applications and minimize disruptions in coverage, agencies should stop activities that would end coverage for current beneficiaries or those who enroll during the public health emergency. That includes:

• Ceasing redeterminations. That will help states satisfy the MOE provision that prevents them from ending coverage during the public health emergency, while also significantly reducing caseworker workload, incoming mail, and beneficiary confusion.
• Stopping the use of periodic income checks. Information that states receive though their periodic income checks is usually months old. Under current circumstances, periodic checks of wage databases are certain to provide faulty information for people who have lost their jobs or whose income has fallen sharply. To satisfy the MOE provisions and reduce Medicaid agencies’ workloads, states must stop ending coverage based on periodic income checks.
• Ceasing the implementation of restrictive waivers, such as premiums and work requirements, that make it harder for people to stay enrolled and are often hard for states to implement.

Agencies have additional flexibility to implement policies that reduce their workload and help beneficiaries. To ensure that people can easily and quickly get coverage, agencies should simplify and expedite application processing. They should:

• Immediately enroll applicants who are eligible based on the information they provide on their applications and obtain any needed verification after enrollment.
• Verify income through electronic data sources whenever possible. If electronic data aren’t reasonably compatible with the information the applicant provides, accept a reasonable explanation (e.g., the employer closed due to the public health emergency). For income that can’t be verified electronically, accept an applicant’s information on a case-by-case basis when obtaining or submitting documents would be hard due to employer and other office closures.
• Maximize the use of presumptive eligibility, which lets qualified entities like hospitals and other health care providers screen for eligibility and temporarily enroll individuals in Medicaid. States can let additional qualified entities, such as social service agencies, temporarily enroll clients when they seek assistance. While that might require some upfront state effort, it could provide an expedited pathway to enrollment during the public health emergency.