The recession caused by the pandemic and the federal requirement that states keep Medicaid beneficiaries enrolled until the national emergency ends have increased the number of people participating in the program by more than 9 million during the year. past year, according to a report released Thursday.
The latest figures show Medicaid registrations jumped from 71.3 million in February 2020, when the pandemic began in the United States, to 80.5 million in January, according to a KFF analysis of federal data.
That’s about $ 56 million in 2013, just before many states rolled out Medicaid under the Affordable Care Act. And that’s double the 40 million registered in 2001.
Medicaid, once considered the ugly duckling of the politically powerful and popular Medicare program, now covers nearly one in four Americans. In New Mexico, the ratio is greater than 1 in 3.
Together, Medicaid and Medicare cover 43% of Americans.
More than three dozen states since 2014 have used billions of ACA funds to expand coverage beyond traditional Medicaid populations to cover adults with incomes below 138% of the federal poverty line, or about $ 17,800 . At the end of 2020, 14.8 million newly eligible adults were enrolled in Medicaid due to ACA.
States that have seen an increase of at least 80% in Medicaid registrations since 2013 are Kentucky (157%), Nevada (129%), Alaska (94%), Colorado (92%), Montana (88%), Oregon (85%) and New Mexico (80%).
Although Medicaid has often been criticized for having too few doctors who accept its low reimbursement rates, state officials say they have weathered the tide with few complaints from registrants about access to health services . One of the main reasons is the dramatic drop in the number of people seeking medical care during the pandemic, as it lowered their risk of contracting covid. Additionally, physicians were able to onboard patients more effectively through telehealth appointments after federal rules extended reimbursement for these services.
“We have no access issues,” said Karen Kimsey, director of Medicaid in Virginia. As of March 2020, Virginia Medicaid has added 308,000 members, a 20% increase, state officials said. With the exception of a shortage of some licensed mental health care providers, state officials said they have enough providers to handle the increased demand.
Typically, an increase in Medicaid enrollment can cripple state budgets, but a covid relief program passed by Congress last year increased the federal share of its funding for traditional Medicaid by 6. 2 percentage points. Before the pandemic, Washington paid on average about 56% of Medicaid costs, with poorer states receiving a larger share of federal funding.
However, the increase in funding has forced states not to remove anyone from the program during the public health emergency, unless they die or leave the state.
The increase in federal contributions does not apply to registrants covered by the ACA Medicaid extension. The federal government already pays at least 90% of their expenses.
Among the big winners of the expanded Medicaid lists are private health plans, which most states use to cover their enrollees. Health plans such as those run by managed care titans UnitedHealthcare, Molina Healthcare and Centene Corp. receive a payment from the states each month based on enrollment. This means that these insurers can profit if they control costs, but they lose money if the expenses to process registrants are too high.
“We are seeing plan incomes rise and health service use decline, which is a recipe for increased profits,” said Massey Whorley, a Medicaid expert with consulting firm Avalere.
Because of the way they are paid, health insurers have benefited financially during the pandemic compared to other major sectors of the health industry, such as hospitals, doctors and nursing homes, forced to expand budgets for additional staff and protective equipment for workers as their incomes declined due to declining demand.
Most health experts expect the Biden administration to maintain the country’s health emergency status at least until the end of the year. Administration officials said they would give states at least 60 days’ notice before ending the emergency so states can prepare to determine who is still eligible for Medicaid and help those who leave. the program to switch to another coverage.
“What we’re seeing now is the climax for Medicaid enrollment,” Massey said.
The Biden administration’s decision to reopen the ACA insurance market from March to August 15 helped boost Medicaid enrollment this year. About 331,000 people who applied for this special registration were eligible for Medicaid or the children’s health insurance program.
Anthony Fiori, an analyst with consulting firm Manatt Health, said some states likely adjusted payments to health plans when negotiating annual contracts to account for a drop in health care use. He noted that many states have limits on the benefits that health plans can generate.
Matt Salo, executive director of the National Association of Medicaid Directors, said some states are considering lowering the rates they pay insurers per person.
As more people are fully vaccinated, Salo said, states expect an increase in the number of registrants seeking care that they deferred during the pandemic, which will increase costs. “There will be a lot of pent-up demand that could explode in the near future,” he said.
Several health plans have told Wall Street investors the pandemic has been good for their financial health.
Molina CEO Joseph Zubretsky said in April that the company’s Medicaid enrollment at the end of March was 3.9 million members, an increase of 260,000 since December. Since the start of the pandemic, the company estimates, it has added more than 700,000 Medicaid members with no plateau in sight.
“For each month that the national covid emergency is prolonged, that would produce around $ 150 million in revenue out of our annual total,” he said.
Zubretsky predicted that many would stay on Medicaid longer.
“The economy of low-wage services, sandwich shops, restaurants, dry-cleaning stores are not coming back very quickly, and I still think there will be a significant amount of that membership that will be on Medicaid for a period of time. extended time, ”he said.
KHN is an independent editorial program of KFF.