Redefining Medicaid and its implications for home care

In less than two weeks, there could be far fewer Medicaid beneficiaries.

Medicaid membership has skyrocketed during the pandemic. Millions of people were suddenly eligible for public health care as companies went on layoffs and unemployment skyrocketed.

Over the past three years, states have been told not to drop people who didn’t specifically ask to be kicked out of school. With the redefinition of Medicaid requirements nationwide, fewer Americans will be considered eligible for Medicaid.

This can make a big difference for home health care providers, given that many of them offer home and community services to the Medicaid population.

Some believe that this will have a significant impact on the future. Others, such as Addus Homecare Corporation (Nasdaq: ADUS), do not.

“When states expanded their Medicaid program, it didn’t really add a lot of business to us because all of our older patients are already qualified,” Addus CFO Brian Poff said earlier this month at the Raymond James Annual Institutional Investor Conference. “So we didn’t see much benefit from [rolling eligibility]and we don’t see much disadvantage in returning override in terms of loss of revenue.”

Addus, based in Frisco, Texas, provides personal care, home health care, and hospice services. Its largest business is Medicaid-based personal care services.

Other companies, such as Missouri payer Centene Corp. (NYSE: CNC) are focused on keeping as many Medicaid eligible beneficiaries as possible.

“We are working closely with our state partners and our network of community partners in each market to facilitate member transition and continuity of coverage,” Centene CFO Drew Asher said during the company’s fourth-quarter earnings announcement. “Last month, we implemented internal and external training designed to maximize the touch point of each participant and our ability to support beneficiaries in verifying their eligibility.”

The impact of the redefinition on providers and insurers will vary from state to state. The urgency of starting the process has also varied so far.

According to a survey conducted by KFF and Georgetown University with additional data from the Centers for Medicare and Medicaid Services (CMS), eight states started the process in February, 15 states started in March, and 28 states will start in April.

In total, KFF estimates that between 5.3 and 14.2 million people will lose their Medicaid coverage during the 12-month cancellation period.

While home care providers will feel these losses, many believe the losses will be made up elsewhere.

Humana Inc. (NYSE: HUM) expects an increase in Medicaid enrollment in 2023, CFO Susan Diamond said during its fourth-quarter earnings call.

The company compensates for losses, and in this case, it will profit from new contracts.

“We expect to add about 140,000 members in Louisiana and 65,000 members in Ohio at implementation, with membership in Ohio growing to 130,000 by the end of the year and 225,000 in 2024,” Diamond said. “The 2023 membership gains in Louisiana and Ohio will eventually be offset by membership losses from the April 1st repeat election that will continue for 12 months.”

From an Addus provider’s point of view, he thinks there’s even a chance that a redefinition of Medicaid could bode well for the company.

“Because the state’s Medicaid program gets smaller because some of the people who were added during the emergency are now laid off, the cost of the Medicaid program will be less for each state,” Poff said. “So we think this bodes well for the state’s ability to keep paying its bills.”

States get to work

There is also encouraging evidence that many Medicaid recipients will re-enroll within the next 12 months.

“Last year, all states took action to encourage employees to update their mailing addresses and other contact information, including contacting those registered directly,” said Jennifer Tolbert, Associate Director of Medicaid and the Uninsured at KFF, during the latest KFF webinar. a week. “Most states are engaging with key stakeholders, including managed care organizations (MCOs), to help make this happen.”

About two-thirds of the states plan to ensure that members complete renewal during the promotion period, and more than half of the states have created online portals to help members stay on Medicaid.

Until the dust settles, there will be plenty of action by stakeholders to keep Medicaid beneficiaries moving forward. It is now important for states and other stakeholders to communicate clearly to members and beneficiaries of the environment.

“We see that it is extremely important to communicate clearly and concisely—and do so often—to help prepare our Medicaid recipients, our community health centers, our patients, and community organizations for the shutdown and all the changes that are coming. ,” Tia Whitaker, Director of Reach and Enrollment for the Pennsylvania Association of Community Health Centers, said during the webinar. “Our messages consist of: ‘There is no wrong door for enrollment assistance.’