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Medicaid quietly shifts beneficiaries’ coverage during pandemic

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During the COVID-19 pandemic, Mississippi was not allowed to kick anyone off Medicaid under federal regulations. In exchange, the state received extra federal funding. 

But Mississippi didn’t simply maintain each person’s coverage. Instead, if enrollees on a managed care plan technically lost eligibility (like a new mom more than 60 days after giving birth) or failed to update their information to prove they were still eligible, the Division of Medicaid quietly moved them to “traditional” or “fee-for-service” Medicaid.

That saved the agency money, because it meant that rather than paying a managed care company a monthly rate for each enrollee, it paid providers directly only when the enrollee sought care. 

The shift apparently affected tens of thousands of Mississippians, raised concerns with providers who didn’t understand why their patients’ coverage had changed with no public explanation, and drew the attention of federal authorities who wanted to make sure the state was complying with the requirement of maintaining coverage during the COVID-19 public health emergency.

Managed care enrollment has declined from about 490,000 in June 2021 to about 364,000 in September, a drop of 26%. Enrollment is now well below pre-pandemic levels of 434,000 in September 2019, according to statistics published on the Division of Medicaid website. 

The change does not appear to have directly altered Medicaid participants’ access to care, because any provider who accepts a managed care plan must also accept traditional Medicaid. But managed care companies tout the benefits they offer members, like 24/7 nurse phone lines, incentives for going to appointments, and free fruits and vegetables, in addition to case management services. 

The Division of Medicaid declined to respond to a detailed list of questions from Mississippi Today. The agency said Director Drew Snyder “is not giving interviews at this time,” though he appeared on the Paul Gallo talk show in late August. Instead, the agency provided statements through spokesperson Matt Westerfield.

“We didn’t feel it was responsible to pay per member per month capitation payments to the managed care companies for the continuous enrollment population, particularly at a time when utilization was expected to remain low due to the pandemic,” Westerfield said. 

He did not respond to a question asking if the agency could estimate how much money it had saved by shifting coverage during the pandemic. 

The three managed care companies – United Health Care, Molina and Magnolia – did not respond to emails and phone calls requesting comment. 

Medicaid implemented the switch in a way that left some enrollees confused about whether they had coverage.

Mississippi Today previously reported that postpartum women received notices informing them they had lost eligibility for Medicaid. Though Medicaid later sent a second letter telling them coverage had been reinstated, several women told Mississippi Today they still thought they didn’t have Medicaid any longer, or they never received the second letter. That meant that some Mississippians who were entitled to coverage for things like postpartum depression and chronic conditions thought they didn’t have health insurance and went without care. 

Now, it appears people in other eligibility categories also received the letters. 

According to documents obtained through a records request, staff at the federal Centers for Medicare and Medicaid Services (CMS) in September asked the Division of Medicaid to pause the notices it was sending “to beneficiaries whom the state has determined no longer meet eligibility requirements”— a much larger number of people than postpartum women. 

On Sept. 16 – well over two years into the public health emergency – Snyder told CMS that the automated notices were being paused. 

Westerfield did not respond to a question asking exactly how many people had received the letters.

When the COVID-19 pandemic began in March 2020, Congress passed a law requiring states to keep everyone on Medicaid throughout the public health emergency. That meant states had to do something they had never done before: change their systems to ensure people who lost eligibility kept coverage. 

Making things more complicated for states, no one knew how long the public health emergency would last. In spring 2020, it appeared possible that the emergency would end within a few months, so it wasn’t clear how long continuous coverage would last, a point Snyder made during his testimony before the Senate Study Group on Women, Children and Families in September. 

Medicaid enrollment climbed each month as new people signed on and none of the usual churn took effect. 

But for months, the Division of Medicaid did not inform providers or beneficiaries directly about the continuous coverage provision. It did not post a message on its website reminding people that they could use their coverage throughout the pandemic. It never explained continuous coverage in its quarterly bulletins to providers, nor in its news updates.

One provider bulletin in September 2020 described the additional federal funding Mississippi was receiving, increasing the match rate from 77 to 83 cents on the dollar. 

“That should help us weather the storm despite an uptick in enrollment,” Director Drew Snyder wrote, not explaining that enrollment was up because no one could lose their Medicaid during the pandemic. 

Westerfield said the agency expects providers to check patients’ Medicaid eligibility during or before their appointment, and that providers can check eligibility at any time online. Since providers would be able to see their patients had Medicaid, the agency assumed the continuous coverage requirement wouldn’t make a difference on their end. 

“Any insinuation that the Division of Medicaid attempted to conceal information about the availability of continuous enrollment for (the) duration of the public health emergency is simply not true,” Westerfield said. 

In September 2022, a website post titled “Preparing for the COVID-19 Public Health Emergency Unwinding” mentioned continuous coverage and urged stakeholders to help get the message out.

But some providers told Mississippi Today they learned about continuous coverage through word of mouth.

Dr. Emily Johnson, an OB-GYN in the Jackson area, learned about it for the first time from a Mississippi Today reporter in October. She did not know that her patients are not losing coverage 60 days postpartum as they normally do. 

“It’s always been an issue that women are very focused, that their Medicaid is going to run out and they want to get their postpartum contraception plan established before their Medicaid runs out,” she said. “I had no idea that that was no longer a pressure – that once their six-week or eight-week time was over, that they had continued access.

“It’s really sad that this is the first time I’m hearing about that,” she said. 

Enrollment in managed care peaked at 490,408 people in June 2021. The total number of Medicaid enrollees was 820,602, according to statistics on the Medicaid website. 

Then, it began to fall, apparently because Medicaid began conducting eligibility redeterminations and moving people off of managed care if they would have been disqualified without the PHE, or failed to update their information. Westerfield did not respond to a question from Mississippi Today asking why managed care enrollment started to fall when it did. 

By September 2022, managed care enrollment had fallen 26% from its June 2021 peak. Total Medicaid enrollment was just over 867,000.

Doctors started to notice that some of their patients’ coverage status had changed.

Leaders of the Mississippi Chapter of the American Academy of Pediatrics wrote to Snyder in May 2022 asking what was going on. Physicians had reported “some pediatric patients are being transferred from the MississippiCAN programs to fee-for-service Medicaid.”

“Unfortunately, the families are unaware of why this is happening,” wrote Hattiesburg pediatrician and chapter President Dr. Anita Henderson in an email obtained by Mississippi Today through a records request. “Recipients rotating off and on to the MississippiCAN or the FFS program are at risk of losing continuity of care, creating confusion for their families, and suffering avoidable medical complications. In addition, this can cause undue administrative and financial burdens for healthcare providers and possibly to the Division of Medicaid.”

Snyder responded that same day. He wrote that when Medicaid reviewed eligibility before the public health emergency, anyone who was not eligible or who didn’t respond to requests for documentation would lose their coverage, but that could no longer happen.

“During the PHE, when the state conducts renewals, beneficiaries who are determined not eligible or who are not responding to requests for documentation get to keep their Medicaid coverage, but still may be moved from a managed care delivery system to fee-for-service,” he said. 

Dr. Tami Brooks, a Starkville pediatrician, was CC’d in the email chain between Henderson and Snyder. Brooks is part of a group of pediatricians that holds regular meetings with Medicaid staff to discuss issues and concerns. She said she was glad that the switch to fee-for-service did not affect children’s access to health care. 

But she wants to make sure people understand that if they are on fee-for-service Medicaid, it means the agency has determined they’re not eligible, and the only thing protecting their coverage is the public health emergency.

“We’re letting our providers know, if you see a fee-for-service child, that likely means that mom needs to get back and recertify them,” Brooks said. 

Federal authorities in early September reached out to the Division of Medicaid with  concerns about how Mississippi was handling postpartum women’s Medicaid coverage during the emergency.

“We received a complaint regarding the state’s 60th day postpartum period policy,” wrote a Medicaid official in an email to Snyder. “We would like to set up a call to confirm our understanding on how the state processes coverage after the 60th day postpartum period.”

But within a few days, and after a call between Medicaid officials, including Snyder and CMS staff, the email correspondence broadened to a discussion of the notices Medicaid was sending people who were switched off of managed care coverage during the pandemic, not just postpartum women.

The notice people got when they were switched off managed care was headlined “MississippiCAN TERMINATION NOTICE – Loss of Eligibility.” It contained no information about continuous coverage during the public health emergency. 

In an email, federal officials listed two regulations that they wanted to make sure Mississippi had not been violating when it moved people off managed care during the pandemic. 

One rule requires managed care companies to inform beneficiaries of “significant” changes to their coverage at least 30 days in advance. 

“We assume these enrollees received advanced notice of the transition back to FFS, but would ask the state to confirm that notices were sent to the managed care enrollees at least 30 days in advance of the transition,” a CMS official wrote. 

But Mississippi Medicaid Deputy Administrator for Health Policy and Services Wil Ervin wrote that this rule didn’t apply because the agency found it only concerned “significant” changes to information included in the managed care enrollees’ handbook. Since the shift didn’t affect anything in the handbook but instead changed enrollees’ coverage entirely, the agency said it did not need to provide advance notice.

CMS also asked Mississippi Medicaid to confirm that the transition from managed care to fee-for-service Medicaid had not disrupted beneficiaries’ access to care. Ervin said it had not. 

After the meeting with the feds, Medicaid changed the managed care termination notice letter to clearly describe the recipient’s ongoing coverage. 

“This letter is to inform you that you are no longer eligible for MississippiCAN,” the revised notice read. “You will continue to receive full Medicaid benefits through original Medicaid until the end of the federal COVID-19 public health emergency.”

It’s not clear whether Medicaid is sending people the revised notices or has paused them entirely. Westerfield did not respond to that question from Mississippi Today. 

“CMS has met with Mississippi several times since the problem was identified to provide technical assistance regarding Medicaid notices,” a CMS spokesperson told Mississippi Today in late October. “The state agreed to pause the use of these notices pending further internal review and discussion.”

The spokesperson did not respond to Mississippi Today’s request to interview CMS staffers who participated in the meetings with Mississippi Medicaid. 

The public health emergency is currently slated to expire in mid-January. But the Biden administration has said it will give states at least 60 days’ notice before lifting the emergency, and since no notice arrived in mid-November, it will be extended again.

When it ends, Mississippi and every other state will begin kicking people off Medicaid rolls once again. Nationally, between 5 and 14 million people could lose their coverage, according to the health policy nonprofit KFF. 

States will have at least a year to complete their review of enrollees’ eligibility, but they have a good deal of flexibility in how they conduct the reviews and how much time they take.

As of November, Mississippi still did not have a plan for this process, called the “unwinding,” Westerfield told Mississippi Today. According to KFF, 17 states lack such a plan currently.

“We have been in the process of developing a plan while actively reviewing all CMS guidance surrounding the PHE,” he said. “We are also aware that CMS has committed to giving states 60 days advanced (sic) notice before lifting the PHE. Upon completion, we will post our unwinding plan on our website.”

Doctors around Mississippi are concerned that when the public health emergency ends, hundreds of thousands of patients could quickly lose Medicaid coverage. 

And people who were switched from managed care to fee-for-service could more quickly lose coverage, since the state has already determined they’re no longer eligible or that they need to update their information to prove they still qualify.

Westerfield did not respond when asked whether the agency will prioritize ending coverage for people who have been moved to fee-for-service Medicaid.

“We are trying as pediatricians to try and get parents to make sure they have their information and go ahead and turn that back into the state,” Henderson told Mississippi Today in September. “We know there will be a grace period with the Division of Medicaid … But we certainly are concerned that when the PHE lifts, we will all of a sudden have thousands of children who may lose benefits, lose coverage and lose access to health care, which would obviously be detrimental to their health and wellbeing.”

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