Your Next Steps If You Lose Medicaid Coverage

As of April 1st, states can begin redetermining Medicaid eligibility for all enrollees granted continuous coverage throughout the COVID-19 pandemic. Recent studies indicate that between 5.3 million to 14.2 million people will lose coverage during this federally authorized 12-month period.  

Without health insurance, uncovered medical costs often significantly exceed peoples’ budgets and deter them from receiving essential care. In light of recent developments, anyone who has become reliant on Medicaid should determine their current eligibility and research other insurance options to ensure they don’t fall into a coverage gap.  

Why Medicaid Coverage Matters 

Congress passed the Family First Coronavirus Response Act in March 2020 to help carry the American people through a confusing and unprecedented global crisis. Among other matters, this legislation required state programs to expand Medicaid access to uninsured individuals and families and provide continuous coverage for all enrollees until the conclusion of the public health emergency.

With the pandemic finally appearing to wind down, Congress passed the 2023 Omnibus Appropriations Bill, an enormous spending measure featuring a clause authorizing states to begin disenrolling ineligible individuals from Medicaid. As of April 1st, many people who have established relationships with doctors and therapists and rely on Medicaid for quality healthcare now risk shouldering interim medical expenses out-of-pocket until they can reestablish coverage. 

Your Options If You Lose Medicaid 

If you anticipate losing coverage during the 2023 Medicaid redetermination period, you can choose between four primary healthcare options:

• Reapply to renew your Medicaid coverage
• Enroll in a new Health Insurance Marketplace plan during the Special Enrollment Period
• Change back to Original Medicare during the Special Enrollment Period
• Enroll in a new Medicare Advantage plan during the Special Enrollment Period

Follow any of the strategies below to secure one of these replacement policies.

Reapply to Renew Your Medicaid Coverage 

2023 Medicaid redetermination will result in a loss of benefits if your state deems you ineligible or if you have not officially renewed or applied for Medicaid within the past 12 months. If removed from coverage, follow these steps to reapply:

1. Determine if you are still eligible to reapply: Medicaid typically covers low-income individuals and families, pregnant women, disabled people, and seniors, though eligibility criteria vary from state to state. To determine these requirements, research and contact your state’s Medicaid agency.
2. Update your contact information and check your mail: Your state will typically mail you a renewal letter, so keep everything up-to-date to guarantee safe delivery.
3. Complete and return the renewal form: Mail your form back as soon as possible to avoid a coverage gap. Unlike Medicare or ACA marketplace plans, Medicaid does not impose an open enrollment period, allowing members to apply year-round. Keep in mind that once the redetermination paperwork has been received, it must be completed within 90 days.
4. Maintain your policy: Once approved, complete and return your Intake/Eligibility review forms every 12 months and report all relevant life changes to avoid policy termination.

Many states will allow you to appeal your Medicaid eligibility judgment if denied coverage. If this appeal fails, you can still apply for Medicare or an ACA Marketplace policy.  

Enroll In a New Health Insurance Marketplace Plan 

The Affordable Care Act (ACA) of 2010 established an online healthcare enrollment portal called the Health Insurance Marketplace. Marketplace plans must abide by ACA-regulated affordability and coverage standards, making them a viable insurance alternative for anybody recently removed from Medicaid. 

Usually, you can only secure one of these plans during the ACA open enrollment period between November 1st and January 15th each year. However, the Centers for Medicare and Medicaid Services (CMS) recently announced an Unwinding Special Enrollment Period between March 31, 2023, and July 31, 2024, explicitly accommodating individuals disenrolled from Medicaid due to post-COVID redetermination.

1. Browse the available plans in your area: Log into the Health Insurance Marketplace or work with a trusted agent to find an affordable policy that fits your coverage needs. Note that each local Marketplace imposes unique enrollment requirements.
2. Determine if you are eligible for health insurance subsidies: The ACA offers sliding-scale premium tax credits and cost-sharing reductions to individuals and families under state-specific income thresholds, expanding healthcare accessibility to previously overlooked populations.
3. Compare your options: If you recently lost free healthcare through Medicaid, you’ll likely want to keep ACA policy costs as low as possible. Weigh the benefits and out-of-pocket expenses of multiple plans against each other before settling on a final decision.
4. Fill out and return your application: ACA applications will ask many personal questions to determine coverage eligibility, including household size, income level, and more.
5. Pay the first premium: Your new health insurance policy will only begin coverage upon payment of your first premium directly to your new insurer.

Change Back to Original Medicare 

Some Medicare beneficiaries qualify for Dual-Eligibility Special Needs Plans (D-SNPs), specialized Medicare Advantage policies that allow them to use Medicaid to pay some out-of-pocket Medicare costs like deductibles, copayments, and prescription fees. However, if you lose Medicaid eligibility, you no longer qualify for your D-SNP and must reapply to a conventional Medicare Advantage plan or government-sponsored Original Medicare.

Traditionally, seniors can only apply for Original Medicare during the annual open enrollment period between October 15th and December 7th to guarantee coverage beginning January 1st of the adjacent calendar year. However, Medicare has granted a Special Enrollment Period (SEP) for individuals who lost Medicaid coverage due to COVID-19 unwinding procedures. This window extends enrollment for 60 days following the exact date or notice of your Medicaid termination.

To revert to Original Medicare, follow these steps:

1. Contact Social Security and apply: Though its online portal provides the quickest route to Medicare coverage, you can contact Social Security over the phone or in person at its local offices.
2. Receive coverage:  Securing Original Medicare should prove relatively straightforward for anyone over 65 years old and will lock in benefits for the remainder of their lives.

Enroll In a New Medicare Advantage Plan 

Alternatively, people accustomed to D-SNP benefits may want to enroll in another Medicare Advantage plan instead of reverting to Original Medicare. Because private companies govern each MA policy uniquely, your potential cost savings, Special Needs Plan eligibility, and overarching benefits could extend beyond those of OM and more closely resemble D-SNP coverage.

Typically, eligible seniors can only enroll in a Medicare Advantage plan during the MA Open Enrollment period between January 1st and March 31st each year. However, as with Original Medicare, individuals who recently lost dual eligibility due to Medicaid redetermination will have a 60 day extended grace period to enroll in an MA plan immediately after losing Medicaid.

Follow these steps to enroll in a new Medicare Advantage Plan:

1. Compare available Medicare Advantage plan types: Since various private insurers offer a wide array of distinctive MA policies, you can choose between different cost-sharing methodologies and benefits packages. Select whichever HMO, PPO, POS, or high-deductible MSA plan offers the best cost-to-coverage balance relative to your situation.
2. Apply for your chosen plan: Once you understand and agree with your desired policy’s regulations and billing structure, apply online through the affiliated insurer’s website, enroll over the phone, or mail in a paper form.
3. Receive coverage: As with OM, you should continue receiving benefits indefinitely unless the private company sponsoring your policy stops participating in Medicare. Should this occur, your insurer will send you a list of options and grant you time to obtain replacement coverage.

What’s Next For You 

The next step forward depends on whether or not you retain Medicaid eligibility following the 2023 redetermination period. Some people disenrolled from Medicaid can still reapply and qualify for reinstated coverage. If you no longer meet Medicaid enrollment criteria and are younger than 65, look into and compare ACA Marketplace plans. Alternatively, eligible seniors or people with qualifying disabilities can enroll in Original Medicare or Medicare Advantage. 

ACA and Medicare policyholders must shoulder shared expenses like premiums, deductibles, copayments, and more. While this may discourage individuals accustomed to free or low-cost Medicaid benefits, both alternatives beat falling into a coverage gap and paying for necessary medical care 100% out-of-pocket.