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New State Option Can Cut Red Tape and Boost Medicaid Enrollment

The Centers for Medicare and Medicaid Services (CMS) has announced a permanent state option to help state Medicaid programs enroll SNAP participants in Medicaid who are certain to be eligible based on the information used to determine their SNAP eligibility.  This will enable more SNAP participants to get and keep health coverage while cutting Medicaid administrative costs by eliminating unnecessary, duplicative work for state eligibility workers.

In the 29 states (plus the District of Columbia) that have adopted health reform’s Medicaid expansion, almost all households participating in SNAP (formerly food stamps) include people who qualify for Medicaid due to their low incomes.  SNAP and Medicaid each ask consumers for much of the same information to show that they meet the program’s financial requirements, but they calculate income and household size slightly differently.  This forces state eligibility workers — who often process eligibility for both programs — to spend considerable time processing eligibility for each program separately.

As this CBPP paper explains, however, the overwhelming majority of SNAP participants are in households with incomes below 138 percent of the poverty line, the Medicaid income limit for adults under the Medicaid expansion.  The new option allows states to identify SNAP participants who are certain to qualify for Medicaid and enroll them — or renew their Medicaid coverage if they’re already enrolled — without requiring state eligibility workers to take additional, duplicative steps, like re-verifying their income.  States that haven’t yet expanded Medicaid also can use the option to enroll certain eligible people, such as pregnant women.

States taking up this option can feel secure that only people who are eligible will be enrolled (or re-enrolled) in Medicaid.  That’s because SNAP household income data are rigorously verified.  As this CBPP paper explains, SNAP errors have fallen dramatically in recent decades due to federal and state initiatives to simplify program administration and improve efficiency.

The new option builds on a similar but time-limited option CMS first made available in 2013.  Six states — Arkansas, California, Illinois, New Jersey, Oregon, and West Virginia — have used that flexibility to streamline Medicaid enrollment for more than 725,000 people.