The Centers for Medicare & Medicaid Services (CMS) recently announced new deadlines for states to comply with federal Medicaid and CHIP renewal requirements as part of the COVID-19 public health emergency unwinding. Here’s what you need to know:
What was the Medicaid unwinding?
The Medicaid unwinding refers to states resuming Medicaid eligibility redeterminations after states suspended them during the COVID-19 pandemic. States were prohibited from removing most individuals from Medicaid to receive enhanced federal funding during the public health emergency, even if they were no longer eligible. The result was a significant increase in Medicaid enrollment.
When the Biden administration declared an end to the public health emergency in early 2023, this triggered the unwinding process. Starting in April 2023, states were required to resume checking the eligibility of everyone on their Medicaid rolls. They disenrolled those who no longer qualified.
However, the unwinding process faced considerable challenges. Many states encountered difficulties complying with federal requirements when conducting these eligibility checks. Issues included:
Widespread Compliance Issues
CMS identified compliance issues in nearly every state, particularly concerning using available data to renew eligibility without requiring action from the beneficiary (ex parte renewals) and ensuring beneficiaries could submit renewal information through multiple methods (online, phone, mail, in-person).
Concerns Over Coverage Losses
There were significant concerns about eligible individuals losing coverage due to procedural issues or difficulties navigating the renewal process. One analysis estimated more than 25 million people lost Medicaid coverage during the unwinding. However, overall Medicaid/CHIP enrollment remained higher than pre-pandemic levels.
Mitigation Strategies
Because of compliance issues, CMS required 36 states to implement mitigation strategies, such as reinstating beneficiaries states wrongly removed or temporarily pausing the renewal process.
Why are there new compliance deadlines?
These new compliance deadlines come as CMS expresses concerns over widespread compliance issues during the unwinding process. The agency noted that nearly all states required some mitigation strategy, including reinstating beneficiaries or pausing renewals to protect coverage for eligible individuals. CMS aims to ensure a more standardized and efficient approach to address these challenges, ultimately safeguarding coverage for eligible individuals.
What are those compliance deadlines?
States must submit a compliance assessment and plan to CMS by December 31, 2024, outlining steps to address non-compliance with federal Medicaid and CHIP renewal requirements. This deadline provides time to complete most unwinding-related renewals and review relevant guidance.
States must demonstrate compliance with all federal renewal requirements by December 31, 2026.
What are the compliance requirements?
There are several key areas where states must demonstrate compliance:
Ex Parte Renewals
An ex parte renewal is a process where a state Medicaid agency attempts to renew a beneficiary’s coverage using information already available to the agency without requiring the beneficiary to submit any information or documentation. This process streamlines renewals and minimizes the burden on beneficiaries and state agencies.
Renewal Forms
States must provide a renewal form that only requests information necessary to determine eligibility, particularly when an ex parte renewal isn’t possible.
States must prepopulate the renewal form with information already available to the agency for individuals enrolled in Medicaid based on Modified Adjusted Gross Income (MAGI).
Timeframe for Returning Forms
MAGI beneficiaries must have at least 30 days from the date on their prepopulated renewal form to return it with any requested information.
States must provide non-MAGI beneficiaries with a reasonable timeframe to return their forms and documentation.
Submission Methods
States must allow beneficiaries to submit their renewal forms through various methods, including online, phone, mail, in-person, or other commonly used electronic options.
Reconsideration Period
If a state terminates a MAGI beneficiary for not returning their renewal form or required information, and they submit the missing items within 90 days (or a longer state-determined timeframe) after termination, the agency must reconsider their eligibility without demanding a new application.
Comprehensive Eligibility Check
States must assess an individual’s eligibility for all Medicaid programs before deeming them ineligible.
Transition Assistance
For those deemed ineligible for Medicaid and CHIP, states must assess their eligibility for other affordable insurance programs and facilitate a smooth transfer of their electronic account to the relevant program.
What if states miss the deadline for submitting a compliance assessment and plan by December 31, 2024?
Continued Non-Enforcement of Previously Identified Compliance Issues
States previously found non-compliant with renewal requirements have been operating under approved mitigation strategies or temporary waivers. Submitting the compliance assessment and plan by December 31, 2024, is a condition for CMS’s continued non-enforcement of those underlying compliance issues. Failure to meet this deadline could lead to CMS taking enforcement action related to those pre-existing compliance concerns.
Triggering of More Detailed Information Requests
CMS may issue more detailed requests for records from states that do not submit the compliance assessment and plan by December 31, 2024. CMS will likely increase scrutiny and demand more specific documentation to ensure states are taking steps toward compliance, even if they haven’t reached full compliance by 2026.
Potential for Additional Agency Action
While the specific actions are not explicitly defined, missing the December 31, 2024, deadline for submitting the compliance assessment and plan may lead to “additional agency action” by CMS. This broader consequence underscores that CMS views the timely submission of the compliance plan as a crucial step toward achieving overall compliance by 2026.
What are the consequences for states not compliant with Medicaid renewal requirements by December 31, 2026?
States that do not comply with federal Medicaid and CHIP renewal requirements by December 31, 2026, may face “additional agency action.” The specific consequences will depend on CMS’s assessment of the state’s circumstances and the nature of the non-compliance.
Here are some potential consequences:
More Detailed and Particularized Requests for Records
CMS may demand additional documentation from states to prove compliance with federal regulations, as outlined in 42 C.F.R. 431.17(d)(2)5.
Withholding of Federal Matching Funds
While not explicitly stated, CMS may withhold a portion of federal Medicaid matching funds as a penalty for non-compliance. This is a common enforcement mechanism for other Medicaid requirements.
However, CMS is committed to working with states to achieve compliance and will provide ongoing assistance, including technical support and guidance.
Certifi’s platform helps Medicaid managed care plans reconcile capitated payments, recapturing lost revenue and ensuring accurate payments.
