Medicaid Expansion: Also Not Going That Well

by Patrick Brennan

The expansion of Medicaid in states that are relying on the federal exchanges for sign-ups is running into real problems, just like the snafus experienced by those trying to buy private insurance, according to Governing magazine. People can sign up for Medicaid in states using the federal exchange website in two ways: either going to the normal Medicaid office, or by going through the exchange. Healthcare.gov is apparently experiencing some of the same issues communicating with state Medicaid agencies and federal databases that it is with private insurers. Becuase the back end of the federal exchange is broken, people’s Medicaid applications are being held up, which has apparently dramatically slowed Medicaid enrollments in the states relying on Healthcare.gov. Many of those states chose not to opt into the Medicaid expansion under the Affordable Care Act, but some did, such as Illinois and Michigan. Further, people signing up for the federal exchange in states that didn’t expand Medicaid may still find out that they’re eligible for the free program (in part because the eligibility has changed slightly everywhere, in part because of something called the “woodwork problem” — already-eligible people will be prompted by the launch of the law to come “out of the woodwork” and sign up for the program). But none of them will be able to sign up for now.

The Centers for Medicare and Medicaid Services (CMS) had already admitted before the federal exchange launched on October 1 that people wouldn’t be able to use it to sign up for Medicaid immediately, but they promised it would be possible by November 1 — now they’ve told state Medicaid directors it won’t work until sometime after November 1. The problem is on the states’ end, too: CMS is running Medicaid in federal-exchange states to varying degrees, but the Medicaid agency in every one of those states also needs to update its own system to communicate with CMS to verify eligibility. And they need to finish other updates, too: Even in states not expanding Medicaid, the program’s eligibility criteria, which used to vary across states, have changed somewhat, moving to one definition of income the IRS decided on, and every state has to update its Medicaid system to reflect that. According to Governing, some states say they won’t be done with all that until close to January 1. 

In the meantime, apparently, the federal exchange will send the lists of applicants somehow deemed eligible for Medicaid to state Medicaid centers, which can enroll customers.

Defenders of the Affordable Care Act have pointed out that, despite the dysfunction of the federal exchange and the inconsistent performances of the state exchanges, the Medicaid expansion has already translated into tens of thousands of Americans gaining coverage — 56,000 Oregonians signed up just since October 1, for instance. But the successful Medicaid states have their own exchanges (and not all of those exchanges have been so successful; the Governing piece notes that many of them haven’t released Medicaid enrollment numbers). The recent decision by the Ohio state government to expand its Medicaid program was also met with liberal exultation — unfortunately, Ohio doesn’t have its own exchange, so the Western Reserve’s new customers will have to wait until their state’s Medicaid program and the federal exchange are working.

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