WASHINGTON — The number of Americans on Medicaid continues to rise as people lose their insurance during the economic downturn, but policy experts disagree on how much additional funding states facing higher costs may need.
National enrollment in Medicaid and the Children’s Health Insurance Program jumped by 4 million between February and June, an increase of almost 6 percent, according to Centers for Medicare and Medicaid Services data released recently.
Record unemployment levels have shifted individuals from employer-sponsored or other coverage to Medicaid, the nation’s program for low-income individuals.
States that accepted a boost in federal funds earlier this year in the first COVID-19 relief package are forbidden from disenrolling individuals from Medicaid during the public health emergency, which Health and Human Services Secretary Alex Azar recently renewed for 90 days starting Oct. 23.
While this ensures that more individuals have medical coverage during a pandemic that has claimed the lives of more than 210,000 Americans, it also further strains states that have struggled this year.
Aviva Aron-Dine, vice president of health policy at the Center on Budget Policy Priorities, said there likely will not be a big impact on state budgets in the long term because the economy and enrollment will eventually return to normal levels.
“But in the near term, I think the impacts are very significant. Medicaid is a big part of state budgets, and so as more people enrolled, that’s putting pressure on state budgets,” she said. “They’re looking at every aspect of their budget and worrying about where they’re going to need to cut.”
Congress is currently stalled on new COVID-19 relief, but any future stimulus deals eventually could include state funding for Medicaid.
The House recently passed a revised version of its COVID-19 package, which would increase the Federal Medical Assistance Percentage payments to state Medicaid programs by a total of 14 percentage points starting Oct. 1, 2020, through Sept. 30, 2021. Senate Republicans are unlikely to support this.
Jack Rollins, director of federal policy for the National Association of Medicaid Directors, said several states are seeing steady increases that are several percentage points above previous years’ enrollment trends.
“The issue of growing enrollment in the Medicaid program is top of mind for our members, and has been since the onset of the pandemic,” he said, adding that it is difficult to pin down how much the enrollment increases are caused by economic conditions in the states or due to the continuous enrollment requirement in the first COVID-19 law.
“We understand and agree with congressional intent to ensure no one loses health insurance coverage during the pandemic, though we have asked for targeted modifications to address certain scenarios where individuals may have non-Medicaid coverage options available as their circumstances change,” he said.
States such as New York, Nevada and Utah saw some of the highest increases in Medicaid and children’s health program enrollment this year, according to CMS. Most, but not all, are lobbying for more federal aid.
Freeman Klopott, press officer for the New York State Division of the Budget, says the state is concerned about funding for a variety of programs that are at risk to offset the state’s $62 billion, four-year revenue loss.
“For six months, we’ve been calling on the federal government to take action, including raising the enhanced FMAP reimbursement rate to 14% and keeping it in place until the national unemployment rate falls below 5 percent. Washington continues to promise federal aid is forthcoming; we believe them, and we are managing the state’s finances to keep the budget in balance as we await clarity on federal action,” Klopott said.
