U.S reaches record low uninsured rate just prior to Medicaid redeterminations

Dive Brief:

The percentage of uninsured Americans fell to 7.7% in March — a record low, according to new data from the Centers for Disease Control and Prevention.
However, the uninsured rate has likely almost certainly risen due to Medicaid redeterminations, which have resulted in an estimated 3.8 million Americans have been kicked off the safety-net coverage since states resumed eligibility checks in April.
Insurers with major exposure to Medicaid redeterminations, including Elevance, Molina and Centene, in earnings calls have confirmed Medicaid membership fell in the second quarter, but cautioned that it’s too early in the redetermination process to draw conclusions about beneficiaries’ final insurance status.

Dive Insight:

The nation’s uninsurance rate has remained below 11% since 2015, since the Affordable Care Act created the individual insurance marketplace. Insurance coverage in the U.S. has also benefited from Medicaid expansion in a majority of states and, more recently, increasingly generous federal subsidies in the ACA exchanges.

Medicaid redeterminations began in April after a period of continuous enrollment during the COVID-19 public health emergency. States have taken different approaches to the process, which has complicated efforts to get a clear picture of redeterminations’ impact on beneficiaries nationwide.

Government projections suggest that more than 15 million people are likely to be removed from Medicaid by the end of the process, with more than six million ending up fully uninsured. Many are being removed due to administrative speedbumps, including misfiled paperwork or changes in address, according to KFF.

The Biden administration has taken action to reduce procedural disenrollments. In June, the HHS announced flexibilities like allowing managed care plans to help members complete their renewal forms and letting pharmacies or community-based organizations help disenrolled beneficiaries re-enroll.

Last month, the CMS annouced it had paused disenrollments in 12 states since April to address issues related to compliance with renewal requirements. The action resulted in “tens of thousands” of people being reinstated to Medicaid rolls, Dan Tsai, director of the Center for Medicaid and CHIP Services, said on a press call.

On earnings calls last week, some of the country’s largest health insurers discussed the ongoing process of redeterminations, with leaders projecting optimism about the final outcomes of the redetermination process on their rolls.

Centene, the nation’s largest Medicaid managed care organization, lost 262,700 Medicaid members in the quarter. Meanwhile, Elevance and Molina, both of which have large government books of business, lost 135,000 Medicaid members and 93,000 Medicaid members, respectively.

Health insurers say they expect to re-enroll members who lose coverage but are still eligible for Medicaid, while transitioning members no longer for Medicaid into their ACA plans.

Molina, for example, expects to retain about half of the 800,000 Medicaid members it gained since the start of the public health emergency by the end of redeterminations; while Elevance said it expects to retain roughly 60% of its added lives.