April 1 change could remove estimated 375,000 from Medicaid in North Carolina

(The Center Square) – As many as 375,000 North Carolinians could lose Medicaid coverage when the federal government ends a continuous coverage requirement from the pandemic that prevented states from removing those who do not quality.

The April 1 transition will require the North Carolina Department of Health and Human Services to requalify Medicaid beneficiaries for coverage over the following year, as the federal government phases out enhanced funding for the continuous coverage.

"During the public health emergency the federal government told the state they couldn't" conduct redeterminations based on changing incomes or other eligibility factors, Katherine Hempstead, senior policy advisor for the Robert Wood Johnson Foundation, told The Center Square. "That's one of the reasons Medicaid enrollment nationwide increased a lot."

Analysis by the foundation and Urban Institute found the number of people enrolled in Medicaid experienced unprecedented growth between February 2020 and June 2022, growing by 18 million nationwide.

In North Carolina, the institute estimates the projected Medicaid enrollment among the nonelderly population to reach 515,000 by April, which includes about 262,000 adults and 252,000 children.

The analysis estimates a total of nearly 2.5 million North Carolinians will be enrolled in Medicaid at that time, a figure that expected to decrease by about 15% or 375,000 by the end of the redetermination transition in June 2024. An unknown number, including many children, will qualify for other federal assistance.

North Carolina DHHS is now preparing for the "massive task of requalifying Medicaid beneficiaries for coverage" officials said in a statement to The Center Square, though the department's estimate of those who will lose coverage is lower.

"We recognize people will lose coverage in this process, but our goal is to ensure people eligible for Medicaid do not lose coverage and those no longer eligible are transitioned smoothly to affordable health plans," the statement read. "Up to 300,000 current Medicaid beneficiaries could lose full health coverage with the end of the continuous coverage requirement. Many of these beneficiaries would be eligible for health care coverage under Medicaid expansion, which the Legislature is considering."

Both North Carolina House Speaker Tim Moore, R-Cleveland, and Senate Leader Phil Berger, R-Rockingham, have signaled Medicaid expansion discussion is a priority in the 2023 session.

Hempstead said states are taking different approaches to the redeterminations, but North Carolina's status as a state that has not yet expanded Medicaid under the Affordable Care Act means fewer residents may fall off the rolls than in other states.

"In a state like North Carolina that doesn't have the ACA expansion, the front door isn't as big because there are fewer ways to be eligible," she said.

So far, DHHS has prepared for the transition in a variety of ways, from developing communication materials, to alerts to update contact information, to posting a summary of the situation and related information online, according to a 50-State Unwinding Tracker run by Georgetown University's Health Policy Institute.

"I think what states should be striving for is accuracy and it seems like North Carolina is doing that," Hempstead said. "They seem like they got a plan, they're trying to do a good job, and reaching out to stakeholders."

Hempstead explained the 12-month determination process is linked to a phase down of federal assistance over the same time frame, because "they don't want states to do it too fast, … because they don't want them to make mistakes."

"It's kind of like two years of determinations happening in a short time period," she said. "Something that always happens is people get disenrolled by accident."

States like North Carolina that conduct ex parte, or administrative removals, based on eligibility data are especially susceptible to mistakes, and the state's plan for the transition will be key to minimizing those.

DHHS officials "are working with internal teams and county DSS partners to facilitate a fair plan for moving forward and addressing needs that arise," according to the statement. "We anticipate submitting the federally required planning documents to CMS by Feb. 15, 2023. We do not yet have a cost estimate."