Biden Admin Orders 30 States to Reinstate Medicaid for 500,000 People

The Biden administration has ordered 30 states to pause disenrollments from their Medicaid and Children’s Health Insurance Program (CHIP) programs and reinstate coverage for nearly 500,000 people after a computer glitch kicked them off.

During the COVID-19 pandemic, terminations of Medicaid coverage were paused until March 31. But now, state Medicaid agencies have resumed the standard annual redeterminations that were a staple of pre-pandemic times.

Seeking to prevent as many eligible people from being removed from Medicaid rolls as possible, Biden administration officials have been sounding the alarm for months over large numbers of people being dropped from Medicaid and CHIP coverage due to paperwork issues like failing to return forms or follow procedures.

“I am deeply concerned about high rates of procedural terminations due to ‘red tape’ and other paperwork issues,” Health and Human Services Secretary Xavier Becerra wrote in a letter on July 28 to all governors, encouraging them to take steps to keep people on the rolls.

And now, some half a million people have had their coverage restored after officials found that they were removed from the Medicaid rolls due to a technical glitch.

An official with the Centers for Medicare and Medicaid Services (CMS) told reporters at a briefing Thursday that some 500,000 children and other individuals lost coverage due to a technical problem affecting automatic renewals for Medicaid.

“By making sure this systems glitch is fixed in states across the country, we will help stop more families and children from becoming disenrolled simply because of red tape,” Chiquita Brooks-LaSure, CMS administrator, said at a press briefing.

Medicaid, the health insurance program designed to provide coverage for lower-income individuals, is primarily administered by individual states, although the program receives significant financial support from the federal government.

The Biden administration has set its sights on preventing as many eligible people as possible from being disenrolled as states resume annual eligibility redeterminations.

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At the end of August, CMS sent a letter (pdf) to all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, requesting that they check to determine if they had problems with their eligibility systems that could cause people to be disenrolled from Medicaid and CHIP despite being eligible.

“CMS has learned of additional systems and operational issues affecting multiple states, which may be resulting in eligible individuals being improperly disenrolled,” the Aug. 30 letter states. “These actions violate federal renewal requirements and must be addressed immediately.”

At the time, the agency found that some state computer systems were flagging entire households for further information and dropping all family members if no one replied instead of reviewing each person individually and automatically renewing children who were still eligible.

CMS’s latest action ordered states that were found to be in violation to halt procedural terminations until they fix their systems.

“Thanks to swift action by HHS, nearly half a million individuals, including children, will have their coverage reinstated, and many more will be protected going forward,” Mr. Becerra said in a Sept. 21 statement.

“We will continue to work with states for as long as needed to help prevent anyone eligible for Medicaid or CHIP coverage from being disenrolled,” he added.

Some state Medicaid directors said Thursday that they were unaware they had been doing things incorrectly.

“It was never clear that this was against the rule or against the regulation, because if it was, we would have been doing it differently a long time ago,” Cindy Beane, commissioner of the West Virginia Bureau for Medical Services and president of the National Association of Medicaid Directors, told The Associated Press.

Medicaid officials said that some states were impacted by the glitch more acutely. For instance, around 70,000 people were improperly dropped in New York, while in West Virginia, this figure stood at a more modest 5,500.