Americans Who Lose Medicaid Post-PHE May Choose Employer-Sponsored Coverage

In most states, beneficiaries who lose Medicaid coverage when the public health emergency ends are likely to transition into employer-sponsored health plans, according to a study funded by AHIP from NORC at the University of Chicago (NORC).

NORC used the Urban Institute’s public health emergency Medicaid coverage loss estimates and historic data from the Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC).

The researchers recategorized the data, taking into account respondents’ coverage type in year one and year two of the transition, supplementing data for smaller states, and applying a hierarchy of coverage types to distribute respondents with multiple coverage sources. When respondents had multiple coverage types, the researchers prioritized first employer-sponsored coverage, then uninsurance, CHIP, nongroup coverage, and other public coverage, respectively.

When the researchers blended these two data sources, the study found that individuals who lose their Medicaid coverage after the end of the public health emergency will transition into employer-sponsored health plans in most states.

More than half of the beneficiaries who lose Medicaid coverage will transition to employer-sponsored health plan coverage in every state except for Georgia (48.9 percent), according to the dashboard associated with the report. The state with the highest share of beneficiaries going into employer-sponsored health plans after the public health emergency was Delaware (57.1 percent).

Overall, more than one in five beneficiaries who lose Medicaid coverage will become uninsured. Seven states had a 23.1 percent expected uninsurance rate or higher: Arizona (23.5 percent), Florida (23.1 percent), Maine (23.3 percent), New Mexico (23.1 percent), North Carolina (23.2 percent), South Carolina (26.2 percent), and Texas (24.5).

Delaware had the lowest uninsurance rate projection, but it was still above 15 percent. The First State may see 17.7 percent of its beneficiaries become uninsured after the public health emergency.

Altogether, 54 percent of beneficiaries will end up in employer-sponsored health plans, 21 percent will become uninsured, 15 percent will gain CHIP coverage, seven percent will join nongroup coverage, and three percent will get other public payer coverage.

These estimates were close to the Urban Institute estimates except for the CHIP and other public payer coverage projections. Urban Institute expected that 18 percent of beneficiaries would turn to CHIP coverage and only one percent would fall under other public coverage.

Around 18 million Medicaid beneficiaries will lose their coverage in the first 14 months after the public health emergency ends, according to the Urban Institute.

In response to the threat of coverage loss after the public health emergency ends, AHIP has partnered with numerous organizations to introduce a new coalition. The coalition’s website consolidates CMS guidance around the redetermination process. The coalition itself encourages information-sharing between stakeholders.

A separate, state-based analysis from the Kaiser Family Foundation found that states that saw significant Medicaid enrollment gains during the coronavirus pandemic could experience the biggest drop in enrollment after the public health emergency ends.