Funded jointly by state and federal governments, Medicaid provides healthcare to millions of low-income Americans. Active enrollment in the program skyrocketed during the COVID-19 pandemic, partly due to regulations that barred states from ending coverage during what was officially declared a public health emergency. However, a recent government-spending bill could result in millions of Americans losing Medicaid coverage starting as early as April 2023. If you are affected by the Medicaid redetermination, you could lose eligibility for Dual Eligible Special Needs Plans, or D-SNPs with Medicare.
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What Is the 2023 Omnibus Appropriations Bill?
The 2023 Omnibus Appropriations Bill includes record-breaking funding levels designed to enhance national security and relieve struggling American families from the rising costs of living. This spending package includes bold investments in health care, including multibillion-dollar contributions to the National Institutes of Health and the Centers for Disease Control and Prevention.
Notably, however, this 4,000-page bill also authorizes states to re-evaluate beneficiary eligibility for Medicaid enrollment as soon as April 1st, 2023. This reverses a previous mandate that prevented states from ending Medicaid coverage for anyone who enrolled between March of 2020 to date, even if changes in income or circumstances made them ineligible for continued Medicaid coverage. This resulted in a roughly 29% increase in Medicaid enrollment.
Beginning in April, states can begin re-evaluating Medicaid eligibility for those enrolled in the program, also referred to as Medicaid redetermination. Those found to be no longer eligible for Medicaid will be disenrolled. This could lead to approximately 15 million people leaving Medicaid.
The bill includes some guardrails for children, however, mandating that all states must continue to cover kids under 12 for one additional year through Medicaid or the Children’s Health Insurance Program (CHIP).
How Does Medicaid Redetermination Affect Your Dual Eligibility With Medicare?
Some individuals who receive both Medicaid and Medicare, or those with dual eligibility, may risk losing some portion of their coverage once federal restrictions for disenrollment are repealed. Many Medicare beneficiaries concurrently utilize Medicaid to help pay for Medicare’s out-of-pocket expenses like premiums, copays, coinsurances, and deductibles. Losing eligibility for Medicaid during redetermination would also cancel an individual’s dual eligibility. This means those found to be no longer eligible for Medicaid must find another way to pay for those Medicare costs
Impacts For Those In a Dual Eligible Special Needs Plan (D-SNP)
Those who are losing their Medicaid eligibility as a result of Medicaid redetermination would also lose their dual eligibility status for Medicare. This means they would lose eligibility for their D-SNP plan, or Dual Eligible Special Needs Plan. Some states offer a grace period for continued enrollment in a D-SNP after losing Medicaid eligibility to allow beneficiaries to renew their Medicaid enrollment, but others do not. Those no longer eligible for a D-SNP would have to find a different Medicare Advantage plan or return to Original Medicare, which typically costs more than D-SNPs.
D-SNPs are specialized Medicare Advantage plans that coordinate the separate coverages from Medicare and Medicaid, making it much easier for members to navigate their policies by combining both services into one package. Roughly 12 million Americans are eligible for a Dual Eligible Special Needs Plan.
D-SNPs also commonly extend their coverage past standard-issue Medicare and Medicaid benefits. Additional coverage can include dental, vision, hearing, meal delivery, personal allowances, and a home care team benefit. As D-SNPs are specifically designed for Medicaid-eligible individuals with low incomes, the out-of-pocket cost to the individual is reduced by these subsidies.
What This Means For You
If you or your family began receiving Medicaid during the COVID-19 pandemic and no longer meet the eligibility requirements, your coverage could end as soon as April 1st, 2023. Contact your state office to find out your status and, if you are still eligible, reapply as soon as possible. Most importantly, update your contact information to ensure you receive all time-sensitive and relevant paperwork.
If you are no longer eligible for Medicaid and lose your dual eligibility status with Medicare, determine if you would like to go back to Original Medicare or enroll in a different Medicare Advantage plan. Disenrollment from Medicaid will kick off a Special Enrollment Period that runs from March 31, 2023 to July 31, 2024. This allows those impacted to enroll in a new plan outside of Medicare’s usual enrollment windows.
Learn more about the Omnibus bill and how it affects Medicaid redetermination.