Feds say thousands of Iowans were disenrolled from Medicaid due to eligibility error

Thousands of Iowans may have been disenrolled from Medicaid and the Children's Health Insurance Program because of an error in determining eligibility as the state works to return Medicaid enrollment to pre-pandemic conditions.

Iowa is one of 30 states where the Centers for Medicare and Medicaid Services determined eligible individuals, mostly children, were being disenrolled even though the states had information indicating they remained eligible.

In conducting automatic renewals for Medicaid and CHIP, the states used family-level data to determine eligibility, CMS said in a press release. That process may have left out children, who generally have higher income limits to qualify for Medicaid, and some other individuals.

CMS estimated 10,000 to 49,999 eligible Iowa individuals were affected by the process.

States were not allowed to disenroll anyone from Medicaid during the pandemic regardless of their income, a rule that ended this spring. Iowa, like other states, has been reviewing Medicaid eligibility and removing those who no longer qualify. More than 40,000 Iowans have been removed from Medicaid and CHIP since April, either because they were ineligible or for procedural reasons.

In a written statement, Iowa Health and Human Services Spokesperson Alex Carfrae said the state will change its automatic renewal processes to comply with the new expectations from CMS.

"Changing direction now will be a cumbersome shift for members and eligibility workers alike; and does not consider the ongoing outreach attempts HHS is deploying to reach members," Carfrae said. "These efforts include mail, email, phone, mail, text messages and now, in-person visits to remind some individuals and households to return their renewal forms."

Since 2017, Carfrae said, the state has sent families pre-populated renewal forms if at least one household members could not be determined to be eligible using the automatic process.

If the household does not return the form after three outreach attempts, the state discontinues eligibility for the whole household, Carfrae said, noting Iowa Medicaid had not previously been told the approach was non-compliant.

He said Iowa would change its renewal process in response to the CMS notice.

"The Iowa Health and Human Services agency deeply care about the work we do and the Iowans we serve, and we look forward to moving past this recent change so that we can dedicate resources to other areas of the program that impact the health and quality of life for eligible Iowans," Carfrae said.