Biden administration asks employers to give more help to workers who lose Medicaid

July 20, 2023  -The Biden administration on Thursday asked employers to give workers who lose Medicaid coverage more time to sign up for health insurance through their jobs.

Medicaid is the state- and federally funded program that covers health care costs for people with low incomes. States have resumed checks for Medicaid eligibility this year after pausing the practice during the COVID-19 pandemic.

Federal officials have estimated that about 3.8 million people who lose Medicaid coverage may qualify for health insurance through their employers, which is how most people in the U.S. get coverage.

Employers typically give people 60 days to sign up for coverage offered through work after they lose Medicaid. The administration’s letter Thursday asked employers, insurers and plan sponsors to voluntarily extend that window to July 31, 2024.

The letter notes that people on Medicaid may miss notices that their coverage is ending, and they might not realize this until they visit a doctor.

People shopping for individual insurance through the federal, marketplace have until next summer to land coverage in that situation.

Benefits expert Paul Fronstin said he’s not sure how employers will react to the request. He noted that changing the window may incur some costs and require educating employees.

“I don’t see them extending it a year,” said Fronstin, director of health benefits research at the non-partisan Employee Benefits Research Institute.

He noted that companies generally want their workers to have health insurance because it keeps them healthy and productive.

But many employers offer an annual window, usually every fall, in which employees can sign up for a plan or change coverage. Fronstin said companies may just use that window to enroll people who lost Medicaid coverage and missed the 60-day window.

“Maybe they have to tinker with their message to make sure they get the attention of people who were covered by Medicaid,” he said.

More than 3.5 million people have already been removed from Medicaid across the U.S. since eligibility reviews resumed in April, according to the latest Associated Press analysis of data reported by states.

Most were dropped for procedural reasons, such as failing to respond to renewal notices sent by state Medicaid agencies. The Biden administration has raised concerns that many may still be eligible and has urged states to redouble outreach efforts.

Thursday’s letter was signed by Chiquita Brooks-LaSure, administrator of the Centers for Medicare and Medicaid Services, and leaders of the treasury and labor departments.


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