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Kansas sees significant increase in Medicaid/CHIP enrollment

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Unlike its neighboring states of Missouri and Nebraska, where significant decreases have been reported, Kansas has seen a significant jump in the number of people enrolled in its Medicaid/CHIP programs, even without loosening its relatively tight eligibility standards.

According to a new report from the Kansas Department of Health and Environment, enrollment in the programs — together branded as KanCare — rose in April to a historic high of 426,642 people, or roughly one in seven Kansans. That’s up from 396,374 in April 2013.

KanCare provides health coverage for adults who are poor and elderly or disabled. It also covers children and pregnant women from low-income families. KanCare is paid for mostly by the federal government, but the state covers about 43 percent of the cost, making it one of the single largest areas of spending for Kansas government at $3.2 billion a year, of which about $1.2 billion is state money.

KDHE officials attributed the increase in enrollment largely to the Affordable Care Act, commonly known as Obamacare. Since January, the federal law requires that most people obtain health insurance or pay a tax penalty. Federal subsidies are available for most people who earn too much to qualify for Medicaid but otherwise can’t afford private insurance premiums. The law originally included provisions requiring states to expand Medicaid eligibility to provide coverage for the poorest adults, but the U.S. Supreme Court later ruled that was an option for each state to decide.

Unlike their counterparts in states like New York, California, Oregon and Colorado, Kansas policymakers chose not to ease Medicaid enrollment restrictions, so the increases in Kansas are modest by comparison with those seen in most of the 26 expansion states.

Bigger than Texas

But compared to several other states where Republican lawmakers nixed liberalization of Medicaid income restrictions, Kansas’ sharp enrollment increase stands out.

For example, Texas is a much larger state thought to have the nation’s highest rate of uninsured people at nearly one in four.

Between Oct. 1, 2013, and March 31, 2014, when open enrollment in the health insurance marketplace ended, Medicaid/CHIP enrollment in the Lone Star State increased by only 3,214. The increase in Kansas over the same period was 22,498. The numbers for April show an even greater spike.

Federal officials reported drops in Medicaid/CHIP enrollment in only seven states during that time frame. All seven chose not to expand Medicaid.

Missouri, Nebraska and Louisiana were among those that reported decreases between October and March, though in at least the case of Nebraska the decrease is expected to be short-lived.

“We believe the decrease … is a temporary anomaly,” says Russ Reno, a spokesman for the Nebraska Department of Health and Human Services. “The most recent data available, April 2014, shows an increase in enrollment from February 2014. Going forward, the department expects continued upward movement in enrollments.”

Reno says officials are still analyzing the reasons for the downturn. They think it was partially attributable to problems encountered when federal officials tried to transfer Medicaid enrollment data files to the states during the first few, glitch-riddled months of the health insurance marketplace.

“The federal marketplace was unable to transfer applications to Nebraska when the open enrollment period started in October 2013,” he says. “In January 2014, the marketplace began sending applications to Nebraska. The marketplace open enrollment ended in March. However, we’re still receiving and working through applications filed with the marketplace during open enrollment. As the ability to get information utilizing the federal data hub improves, timeliness of determining eligibility is also improving. Enrollment has been on the increase as these applications have been processed.”

The same thing apparently is going on in at least several other states, though apparently the problem, to the extent it existed in Kansas, failed to produce an enrollment drop.

According to David Warner, a professor of public policy at the University of Texas in Austin, the federal government “couldn’t relate to Texas Medicaid digitally and they couldn’t send files anyway. Nobody got signed up (for Medicaid/CHIP) through the marketplace, so there was a huge backlog and it didn’t begin to get resolved until late in January.”

Warner says although Texas’ enrollment had only gone up by about 3,000 by the end of March, there were more than 100,000 “determinations of eligibility” at the federal level even weeks before the open enrollment closed, indicating a large gap between the number of people likely eligible and trying to get into the programs versus those who actually got enrolled.

Warner says it didn’t help that Texas fought to retain its own eligibility and review procedures on top of the new marketplace ones, including some federally prohibited asset tests, which further complicated the application process.

At the end of March, federal officials gave notice to Texas that it had to stop asking applicants questions regarding assets. The state has 60 days to appeal.

Texas welfare officials have estimated there are still more than 131,000 people eligible but not enrolled for Medicaid/CHIP.

Missouri has biggest decrease

Missouri reported the largest decrease in Medicaid/CHIP enrollment of any state in the nation, with almost 34,000 fewer enrolled at the end of March than at the end of September 2013.

Explanations vary.

Officials at the Missouri Department of Social Services point to the recovering economy.

“As the economy has improved, fewer Missourians are relying on assistance programs for support,” says Rebecca Woelfel, the agency’s communications director.

April numbers for Missouri show a continuing decrease.

Others in the Show-Me State point to the sort of problems with federal data transfers noted in Nebraska and Texas and the political foot-dragging that Obamacare has faced in most red states.

In February, the St. Louis Post Dispatch reported that Missouri’s social services chief, Brian Kinkade, said the state couldn’t process the more than 25,000 program applications forwarded by federal officials as eligible because the data files were filled with errors and duplications.

Even before that, Missouri voters had approved Proposition E, showing their displeasure with Obamacare.

“It made it illegal for any state worker or employee to implement the ACA (marketplace) in any way, and so it made it difficult for our Department of Social Services … to even talk to the feds because they could have been up for a lawsuit,” says Stanton Hudson, associate director of the Center for Health Policy at the University of Missouri. “That led to some of the numbers going down, at least initially.”

‘Not surprised’

Kansas officials say the numbers are up mostly due to the public attention given Obamacare and the marketplace leading up to the Oct. 1, 2013, launch. That helped push into the program people previously eligible for Medicaid/CHIP but not enrolled, a phenomenon known as the “woodwork effect.” Presumably, people eligible for Medicaid but perhaps unaware of the program come “out of the woodwork” once they learn they can get the benefits.

Participation in the Kansas programs averaged fewer than 400,000 people in the months leading up to the marketplace. Even at the height of the recent recession, Kansas Medicaid/CHIP sign-ups hovered around 380,000.

“We are not surprised to see the increased enrollment. As the Aon study and others predicted, implementation of the ACA at the federal level influenced Medicaid and CHIP enrollment in Kansas and other states,” says Sara Belfry, a KDHE spokesperson.

The Aon Hewitt consultants’ study, released in February 2013, was commissioned by the Brownback administration as it considered whether to expand Medicaid.

The report’s authors predicted that Kansas Medicaid-CHIP enrollment would increase by 20,563 this year as a result of Obamacare, even if state policymakers chose not to broaden the program because of the woodwork effect.

‘Reviews have since resumed’

According to the Aon Hewitt prediction, growth in Kansas Medicaid-CHIP enrollment will “ramp up” by 41,538 enrollees by the end of 2016.

The consultants also estimated that more than 225,000 Kansans would gain Medicaid-CHIP coverage should state policymakers loosen eligibility restrictions in keeping with the Affordable Care Act. There are varying estimates from other sources, however, some of which are considerably lower.

Belfry says the sharper increases of the last couple of months also were the result of earlier, stalled applications now being processed and moving through the pipeline.

“KDHE also had temporarily delayed eligibility reviews as part of the conversion to the ACA-mandated modified adjusted gross income methodology (for determining income eligibility) and the transition to our new eligibility system. Reviews have since resumed,” she says.

 Mike Shields is managing editor of KHI News Service, an editorially independent reporting program of the Kansas Health Institute. 

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