Lessons learned from the Medicaid unwinding period

More than a year ago, states began the herculean task of unwinding COVID-era Medicaid provisions, such as continuous enrollment for low-income families. They had 14 months to complete the process. Today, at least 10 states are still evaluating whether all of the people on their Medicaid rolls qualify. 

Before the unwinding process began in March 2023, Medicaid and the Children's Health Insurance Program had seen enrollment increase by more than 30% to a peak of 94 million participants. States were barred from dropping people’s coverage during the pandemic, and during that time, the uninsured rate also hit near record lows, said Robin Rudowitz, director of KFF’s Program on Medicaid and the Uninsured. The restriction, which Congress discontinued in December 2022, helped stabilize individual’s coverage, reducing Medicaid churn—or the process of losing coverage and reapplying for reenrollment. 

A new report by KFF and Georgetown University’s Center for Children and Families looks at how states have navigated the Medicaid unwinding process, specifically focusing on how they utilized federal waivers for ex parte renewals, or those that use available data sources to redetermine eligibility without requiring information from the individual. The report is based on a March survey that includes 49 states and Washington, D.C. Florida did not participate.

During the unwinding period, 60% of Medicaid renewals were done on an ex parte basis. Every state and the district reported that they were working to improve the process, with 42 states saying that they leveraged federal waivers to support renewal efforts. 

The Centers for Medicare & Medicaid Services approved several waivers more than a year ago that looked to increase renewal rates by allowing states to reenroll Medicaid participants using five authorized strategies: relying on eligibility data from Supplemental Nutrition Assistance Program enrollees, leveraging income verification data from within the last 12 months, determining eligibility based on asset verification data, receiving beneficiaries’ contact information from partnering managed care plans, and extending the timeframe for taking administrative action on fair hearing requests. 

The waivers can help agencies reduce the administrative burden of redetermining individuals’ eligibility and address operational challenges in Medicaid programming, federal officials said in a March 2022 letter to state health officials. This could be particularly critical for understaffed agencies. In the KFF survey, 41 states reported that workforce shortages had “a significant or moderate impact on the states’ ability to manage application and renewal workloads.”

Thirty-four states said their ex parte process was mostly automated, which helped increase the renewal rate. Updating system rules and expanding the number of data sources used to conduct eligibility reviews also boosted Medicaid renewals among states, said Jennifer Tolbert, deputy director of KFF’s Program on Medicaid and the Uninsured.

Many states reported they are interested in maintaining renewal flexibilities used during the unwinding period. Twenty-five states, for instance, said they are interested in continuing to leverage data from SNAP and/or Temporary Assistance for Needy Families for eligibility redeterminations, and 29 states reported that they would like to renew Medicaid coverage even when no income data is reported.

In fact, CMS announced last month that states could continue using waivers through June 2025 to “enable states to shift limited resources to reduce processing time.” 

Data has played a crucial part in monitoring the unwinding process, researchers said, but half of the survey respondents said they either planned to stop reporting renewal data or were unsure if they would continue reporting the data. Only 15 states confirmed they would make renewal-related data public after June. Federal officials, however, recently encouraged states to continue publicizing unwinding-related data on a monthly basis as CMS plans to keep reporting state and national data. 

Moving forward, 16 states said they planned to conduct periodic data checks to “to identify potential changes in income or circumstances that could affect eligibility.” Three of those 16 respondents said they would extend renewal dates for 12 months if a mid-year check showed someone was eligible for continued coverage, and seven states said they would only provide individuals 10 days to respond to requests for more information following a periodic data check. 

Beginning in June 2027, however, states will be required to provide residents a 30-day window to comply with requests for information under CMS’ new eligibility and enrollment rule, which officials posted to the Federal Register in April. It went into effect earlier this month.

Ultimately, Medicaid unwinding “has been a huge undertaking for both the states and the federal government, and there have been an array of policy choices, as well as implementation of those policy choices that really make a difference in [ensuring] that eligible people remain able to get and maintain coverage,” Rudowitz said. “Looking to the future, the unwinding has spurred … enrollment and renewal processes that will become part of a new normal for operations.”