Payers prep for the great 2023 shuffle from Medicaid to ACA coverage

The nation's uninsured rate is at a record low thanks in part to continuous Medicaid enrollment since early 2020. But with the federal public health emergency expected to come to a close in 2023, payers are prepping for a major disenrollment of beneficiaries nationwide.

"Looking to 2023 and given the potential resumption of eligibility redeterminations next year, a high priority for our team is ensuring continuity of access and care for those we serve," UnitedHealth Group CEO Andrew Witty told investors Oct. 14. "We're very focused on that because we're concerned that a redetermination cycle during 2023 and 2024, depending on when the PHE comes to an end, could lead to a situation where folks get dislodged from their coverage."

Since February 2020, total Medicaid/Children's Health Insurance Program enrollment has increased by 17.7 million people, or nearly 25 percent. UnitedHealthcare has added 350,000 Medicaid members in 2022 alone.

The company's Medicaid CEO Tim Spilker expects the PHE to end in January and redeterminations to begin in the first quarter. When the process does begin, HHS estimates up to 15 million people could lose coverage, likely over the course of a year.

"Our tailwinds will be weighed against one known headwind, and that is the membership attrition and related impacts on our Medicaid business as eligibility redeterminations are conducted over the course of the next year," Elevance Health's CFO John Gallina told investors Oct. 19.

According to analysts at Fitch, payer losses from millions of disenrolled beneficiaries could be mitigated through the Inflation Reduction Act's extension of ACA premium tax credits through the end of 2025, which will allow some people to regain coverage in the individual market.

"They could be eligible for subsidies to help cover the cost of comprehensive plans through the marketplace," Paul Nobile, president of Anthem BCBS in Wisconsin, said Oct. 17. "We're pleased to expand our offerings across Wisconsin."

The nation's largest payers have all recently announced plans to majorly expand ACA offerings in 2023, including UnitedHealthcare, Elevance, Aetna, Cigna and Centene — it's also why they're investing heavily in the transition.

UnitedHealth said it has partnered with states, community organizations, national retailers and pharmacies to help people retain coverage post-PHE and educate about available resources.

Major challenges are expected when a Medicaid redetermination period is triggered — a process that is complicated in normal circumstances. States are suffering from workforce pressures too, and it will be difficult for them to process millions of individuals concurrently, many of whom have moved in the last few years. 

"This will be a big lift for states, a really long-term effort over the course of 12 to 14 months," Mr. Spilker said. "So, we're trying to do our part through data sharing, through outreach to consumers, engaging communities, engaging providers and then really connecting with individuals where they access care."

Elevance Health's president of commercial business, Morgan Kendrick, described the company's redetermination strategy as a "catcher's mitt." 

"There's business that stays on the Medicaid side, there's business that's going to move to the commercial side, be it group or individual," she said. "We've done a really nice job in expanding our footprint to cover roughly 95 percent of the population of the geographies we serve from a commercial individual ACA perspective."

In addition, CMS said Aug. 26 it is investing close to $100 million to help minority individuals and those in underserved communities find and enroll in ACA plans, Medicaid and CHIP. The American Hospital Association says the Biden administration and CMS have taken steps to support states with more time and information before the PHE eventually ends.

"There are policy things that can be done, and we think the administration has done many of them," Molly Smith, AHA's group vice president of policy, told Becker's. "I know what they are trying to do is really make sure that all of the different stakeholders are aligned and speaking from the same talking points."

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