Medicaid redeterminations may impact provider pay

Regular Medicaid coverage redeterminations will likely resume in 2022, and providers could see many of their patients lose or change coverage as a result.

The Urban Institute estimates roughly 15 million people will be kicked off Medicaid when redeterminations start back up. The requirement that states maintain Medicaid rolls to receive enhanced federal matching funds could disappear in a few months. Even though the “hold harmless” rule is set to remain in force throughout the duration of the COVID-19 public health emergency, the Build Back Better Act would allow redeterminations to start next April even if an emergency declaration is still in force.

Policymakers are focused on how redeterminations will affect beneficiaries, but providers may face challenges too, said Matt Salo, executive director of the National Association of Medicaid Directors.

The impact on provider reimbursement depends on how many people deemed ineligible for Medicaid actually connect with alternative coverage options. About one-third of adults in this group are predicted to qualify for subsidized insurance from the health insurance exchanges, while others will have access to employersponsored coverage, the Urban Institute predicts.

In some cases, exchange policies pay providers more than Medicaid does, although that’s not true across the board, said Jennifer Tolbert, director of state health reform at the Kaiser Family Foundation.

Some Medicaid enrollees will lose coverage because of red tape when redeterminations resume, even if they’re still eligible, Tolbert said. And how many of those removed from Medicaid will actually enroll in exchange coverage is a major unknown, she said.

This could lead to higher rates of uninsurance among this population, stretching community health center budgets and raising healthcare costs across the board, said Jeremy Crandall, director of federal and state policy at the National Association of Community Health Centers.