JFO: 15 percent of Medicaid enrollees may be ineligible

Editor’s note: The headline and story were updated to include the state’s Medicaid population between the ages of 18 and 22.

MONTPELIER — The Legislature’s Joint Fiscal Office has estimated that as many as 15 percent of the state’s Medicaid enrollees are not eligible for the program, but the Shumlin administration says that number is slightly higher than what they are finding as they review cases one-by-one.

MedicaidThe state is grappling with higher-than-expected enrollment in its Medicaid program, which is funded by both state and federal dollars. A consensus estimate in 2014 projected that 46,738 adults would be enrolled in Medicaid during the 2015 state fiscal year and another 42,785 would be eligible for qualified health plans with subsidies on the state’s health care exchange. But the actual number of Medicaid enrollees came in higher, however, at 72,534. Meanwhile, just 16,906 people enrolled in qualified health plans.

In the 2016 fiscal year, the state estimated about 64,951 people would be enrolled in Medicaid and another 18,368 would qualify for subsidies on the exchange. The actual number enrolled in Medicaid through February, however has been much higher — about 84,000, according to an issue brief authored by Joyce Manchester, a fiscal analyst with JFO. Just 13,242 enrolled in qualified health plans with subsidies on the exchange.

The reason for the higher enrollment could be due to the many Vermonters that were once enrolled in the Vermont Health Assistance Program and the Catamount Health Premium Assistance Program, both of which were eliminated when the federal Affordable Care Act went into effect in 2013.

As many as 11,700 Vermonters in both programs were automatically transitioned into the state’s Medicaid program using older eligibility criteria that was updated under ACA, according to the JFO brief. The state obtained a waiver from the Centers for Medicare and Medicaid Services that allowed the state to enroll them under older income eligibility rules. Under the ACA, eligibility is now determined by Modified Adjusted Gross Income. Manchester used 2013 tax filings to determine that as many as 11,700 Vermonters may have been enrolled in Medicaid under the old income eligibility rules but may not qualify under the new rules.

Manchester used the 2013 tax data and a set of assumptions, including 17 to 20 percent of people who may have had insurance coverage through an employer, to determine how many adult Vermonters may be eligible for Medicaid.

“Based on those rough calculations and using the midpoint for each assumption, roughly 63,000 adults ages 23 to 64 might be expected to be eligible for Medicaid in 2016,” she wrote.

When the state’s 18 to 22 population is factored in JFO estimated that a total of 71,500 people may now be eligible for Medicaid.

According to the brief, higher automatic enrollments “than seem reasonable today” might be explained by a lack of eligibility redeterminations since early 2014. The CMS waiver that allowed Vermont to automatically enroll VHAP and CHAP enrollees in Medicaid in 2013 stipulated that redeterminations take place in 2014.

However, because Vermont Health Connect lacked the requisite technology, those redeterminations did not take place. The state obtained another waiver from CMS to complete the redetermination process for “legacy” enrollees who had received Medicaid prior to January 2014 by February. The deadline for redeterminations for Medicaid enrollees who first entered the program through Vermont Health Connect using the new income definition was extended to November.

“Using tax filers only and rough measures of income eligibility suggests up to 1/4 of the transferred VHAP adults (about 7,300 adults) and a large portion of the transferred Catamount adults (between 2,400 and 4,400 adults) would not have been eligible for Medicaid under the post-ACA definition of income,” Manchester wrote. “If true, the number of adults enrolled in Medicaid today could be reduced significantly through redeterminations. The difference would explain up to 1/3 of the increased enrollments since the early estimate in January 2014.”

Lawrence Miller, Democratic Gov. Peter Shumlin’s chief of health care reform, said the administration began the redetermination process last October and is on track to complete it by the November deadline. He estimated the state is about halfway through the process.

Chief of Health Care Reform Lawrence Miller (VPR/Taylor Dobbs)

Chief of Health Care Reform Lawrence Miller (VPR/Taylor Dobbs)

So far, the administration said about 87 percent of those checked remain eligible for Medicaid. About 77 percent of those no longer eligible qualify for subsidies on the exchange.

Miller said JFO’s issue brief is useful to show how difficult it has been to implement the federal law, but the administration believes the estimates provided in the brief are not accurate.

“I think what it does is sort of correctly indicate that there were a number of variables in play that made it difficult to forecast whether or not people would wind up … in subsidized qualified health plans or in Medicaid coverage,” he said. “It does show that the aggregate estimate of people who come into coverage was pretty good, it was which bucket they landed in.”

Shumlin spokesman Scott Coriell said the administration is not surprised that the state’s 2014 estimates for Medicaid enrollment did not hold up.

“The world changed pretty substantially in late 2013 and early 2014 when it comes to health care,” he said. “Obviously no one quite new what was going to happen so it’s not totally surprising to me that estimates were not accurate.”

However, Coriell said facts do not support a supposition that large numbers of Vermonters are wrongly enrolled in Medicaid.

“We have zero indication that there are people on Medicaid that shouldn’t be. In fact, it’s kind of the opposite. We have been doing these redeterminations and the initial data that we’re getting is that nearly 9 out of 10 that are responding are still eligible,” he said. “In the real world we’re basically auditing the medicaid program which people have asked us to do and the result is that people who deserve to be on Medicaid are on Medicaid.”

Miller said the waivers that allowed the state to delay redeterminations has helped ensure that people who are eligible for Medicaid were not kicked out of the program.

“CMS was pretty clear when we didn’t have the tech sorted out that what they didn’t want to happen was that people who were eligible get thrown off,” he said.

The state has booked about $3 million in Medicaid savings in the 2017 fiscal year state budget from redeterminations, which is a very small percentage of the Medicaid budget. Completion of the redetermination process later this year will provide the state’s best look yet at the true number of Vermonters eligible for the program.

“We do expect to see some fall off with eligibility redeterminations, but in the sense of the total budget, not a lot,” he said.

neal.goswami@timesargus.com

Read the issue brief below:

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