Millions of Americans Set to Be Removed From Medicaid After Passage of Omnibus Bill

The US Department of Health and Human Services (HHS) building is seen in Washington, on July 22, 2019. Alastair Pike/AFP via Getty Images

Millions of U.S. citizens who enrolled in the Medicaid insurance program during the COVID-19 pandemic could soon lose their coverage due to the passage of the $1.7 trillion omnibus spending bill.

Back in January 2020, the Trump administration declared a public health emergency (PHE) that has been renewed every 90 days since. The Families First Coronavirus Response Act (FFCRA) was signed into law in March 2020 prohibiting states from removing Medicaid recipients from the program as long as the PHE is in effect, thereby ensuring that Americans have access to continuous medical coverage during the pandemic.

The $1.7 trillion omnibus bill, however, contains a provision that will eliminate Medicaid coverage protection from PHE, implying that states can start removing individuals who do not meet Medicaid criteria beginning in April 2023.

Medicaid is a form of free or low-cost health care in which people qualify based on income and family size. People usually lose their Medicaid coverage when their incomes increase and they fall outside its eligibility requirements.

According to an estimate by the Health and Human Services (HHS), around 15 million Americans could end up losing Medicaid and Children’s Health Insurance Program (CHIP) coverage once states begin to judge individuals based on the eligibility criteria that were in effect prior to the COVID-19 pandemic.

Republican Push to End PHE

A group of 25 Republican governors sent a letter to President Joe Biden on Dec. 19, requesting that he end the PHE in April.

The letter points out that PHE negatively affects states as it artificially raises the number of Americans under Medicaid even when they are ineligible. As a result, states have to shell out more money for the program.

“Making the situation worse, we know that a considerable number of individuals have returned to employer-sponsored coverage or are receiving coverage through the individual market, and yet states must still account and pay for their Medicaid enrollment in our non-federal share. This is costing states hundreds of millions of dollars,” the letter stated.

Since the beginning of the pandemic, states have added 20 million Americans to Medicaid, a number that continues to climb. The governors, however, want to end the PHE and provide states with notice of such intentions well in advance.

Medicaid Redeterminations

In a press release on Dec. 20, the National Association of Medicaid Directors pointed out that more than 90 million Americans are enrolled in Medicaid, which is the largest number of members in the program’s history.

“Potential Medicaid coverage losses as redeterminations begin have ranged from 5 million to 19 million, though many of these people will be eligible for or already on other coverage,” according to the release.

Among those who are likely to be removed from Medicaid, those with incorrect personal information are expected to be at the top.

Some worry that the massive volume of eligibility redeterminations might end up pushing some people out of Medicaid, even those who are eligible. The HHS estimates that 6.8 million people might lose Medicaid coverage under such circumstances.

On Dec. 12, the HHS issued a proposal that will allow state Affordable Care Act marketplaces to establish a special sign-up window so that individuals who are booted out from Medicaid can soon join an alternative.

The Biden administration has informed states that it will provide a 60 days’ notice before it ends the PHE. The current public health emergency lasts only until Jan. 11, 2023.

As the federal government has not yet provided any notice to states, the administration is expected to extend PHE until April.