CMS Pauses Medicaid Disenrollments, Reviving Coverage for 500K People

Almost half a million children and families will regain Medicaid or Children’s Health Insurance Plan (CHIP) coverage after CMS identified system errors in states that led to improper disenrollments.

On August 30, the agency sent letters to all states directing them to assess and report if they had a system issue that was disenrolling eligible individuals from Medicaid and CHIP during the redetermination process.

Recent data released by HHS shows that 30 states reported having the system error. In response, CMS has required all 30 states to pause procedural disenrollments unless they can ensure eligible beneficiaries are not improperly disenrolled.

“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. HHS is committed to making sure people have access to affordable, quality health insurance – whether that’s through Medicare, Medicaid, the Marketplace, or their employer,” HHS Secretary Xavier Becerra said in the announcement. “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.”

The system issue in question was related to automatic renewals of Medicaid and CHIP coverage, known as ex parte renewals. States use existing data to determine beneficiary eligibility and automatically renew coverage.

This process is meant to make it easier for beneficiaries to renew their coverage and aims to help keep eligible people enrolled. However, CMS found that some ex parte renewal systems were evaluating redeterminations by family instead of by individual, leading to improper coverage losses.

“Medicaid and CHIP are essential for millions of people and families across the country,” said CMS Administrator Chiquita Brooks-LaSure. “Addressing this issue with auto-renewals is a critical step to help eligible people keep their Medicaid and CHIP coverage during the renewals process, especially children. CMS will keep doing everything in our power to help people have the health coverage they need and deserve.”

The redetermination process following the end of the public health emergency has been rocky.

In July, CMS paused redeterminations in six states as most coverage losses were due to procedural reasons, meaning states could not identify if someone was ineligible, but the beneficiaries did not complete the renewal process. Data from KFF revealed that, as of August 23, 74 percent of Medicaid disenrollments occurred because of procedural reasons.