Implications for Medicaid Beneficiaries
A person who has lost Medicaid coverage is likely to experience negative impacts. Studies show that Medicaid coverage is associated with financial security and educational attainment.
Additionally, losing Medicaid makes people more likely to forego medical services, potentially impacting their physical and mental health.
Implications for Providers and Reimbursement
There are three key implications for providers and reimbursement:
- DSH and uncompensated care
- Revenue cycle
- 340B
DSH and Uncompensated Care
Providers may see a significant reduction in their allowable Medicaid days for Medicare DSH purposes as patients may now be uninsured or enrolled in other health plans.
This impact, along with recent changes in the allowability of certain Section 1115 waiver days, will see many providers with substantial cuts to their Medicare DSH payments, and some may no longer even meet the qualification requirements for a DSH and uncompensated care payment.
Providers may also see an uptick in their uninsured patients. It’s incumbent on providers to ensure their financial assistance policies and procedures are updated to accurately report this information on Worksheet S-10 on future cost report filings.
Revenue Cycle
Provider revenue cycle teams may be impacted by increasing financial counseling volume as newly uninsured patients seek care, exceeding provider capacity. This could create a patient access bottleneck and increases the risk that patients eligible for Medicaid might not obtain coverage. Prior to seeking care, many patients may not be aware they have lost Medicaid coverage and may need assistance identifying any coverage they’re eligible for. Many of those who lose coverage will likely become uninsured.
340B
The reduction in Medicaid days may also put in jeopardy 340b qualification, as the threshold for qualification is tied to the DSH adjustment percentage. Many hospitals that traditionally have qualified for the 340b program may now be at risk of losing this discount on covered outpatient drugs, which are substantial cost savings for providers.
How Stakeholders Can Impact the Process
The redetermination process is an unprecedented event, much like the continuous enrollment mandate itself. There are many variables and moving parts rendering the process extremely complex. Parties to the process should exercise maximum cooperation and vigilance to help ensure all individuals that qualify for coverage are appropriately identified.
Fortunately, there are steps stakeholders can take to support these efforts.
Partner with State Officials and Understand the Process
In an environment with different approaches by state, it’s incumbent on stakeholders to be intimately aware of the regulations, procedures, and processes available and to help ensure they’re followed and know what to expect.
The federal regulations in Title 42 of the Code of Federal Regulations (CFR) Section 435.916 require states to comply with provisions covering:
- Fully utilizing information already available to the state through any other state agency
- Only request information not otherwise already available electronically
- Accepting information online, via phone, via mail, and in person
- All bases of eligibility must be exhausted prior to termination
- Adequate time for beneficiary response
- Advance notice of termination and the rights to file appeals
- Process simplification
- Use of ex parte information
Hospitals, hospital associations, and other stakeholders should have ongoing dialogue with state officials about their process and challenges in implementing their processes to reduce the negative impacts on beneficiaries.
What Providers Can Do to Protect Their Reimbursement and Help Patients
Hospitals and other providers have a wealth of historical information about patients and their Medicaid eligibility history as many of the same patients are seen multiple times over the years. Additionally, providers are generally considered trusted sources of information by their patients.
Collaborate with Other Organizations
Work with your State Medicaid agency and Medicaid Managed Care Organizations, along with other organizations such as schools and faith groups, to coordinate messaging about redeterminations, including what enrollees should expect and consequences if they don’t respond.
This communication should be executed in all languages applicable to the populations served. In some cases, enrollees may respond more favorably to communication from their provider than from a state agency or managed care organization. Some states have established formal programs for ambassadors that can be used for this purpose.
Provide Communications
Provide information at registration to all current Medicaid eligible patients and obtain up-to-date contact information. Update revenue cycle scripts to inquire about any Medicaid redetermination communication the patient has received.
Identify and Support Disenrolled Patients
In addition to communicating these changes to your community, be proactive about identifying your patients who have been disenrolled. This will remove a barrier to them seeking care when it becomes necessary, reduce the workload on financial counseling teams, and create patient goodwill toward providers.
Work with your state Medicaid agency to analyze your patient population that has been disenrolled from Medicaid for administrative reasons, comparing these enrollees to your patient population. Many states are processing disenrollments in batches. Knowledge of this cadence can help providers validate eligibility for upcoming services after the state has completed a disenrollment batch.
This approach is only viable with a Medicaid agency willing to collaborate. Additionally, some patients who are disenrolled may be already enrolled in other coverage, so there should be an additional step to identify these patients.
Work with a coverage discovery vendor to evaluate the current insurance coverage of your Medicaid patient population. This allows you to identify non-Medicaid coverage for patients upfront.
Even with these proactive approaches, providers should prepare for the significant administrative burden on health care systems seeking to collect reimbursement. The effects of these redeterminations will undoubtably be an increased burden on all facets of the revenue cycle.
Providers should re-evaluate their capacity to assist patients in the enrollment process and determine if any outside assistance is needed, as the impact on these redeterminations will be felt for years to come.
The increase in the uninsured population may also require a reassessment of charity policies and financing options along with re-evaluating collection strategies.
Whatever the approach, this will require effort but is likely to produce a sound financial return while serving the community.
We’re Here to Help
For more information to help your organization navigate the Medicaid redetermination process, contact your Moss Adams professional.
Additional Resources