ACA enrollment grows as Indiana unwinds Medicaid coverage
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Hundreds of thousands of Hoosiers recently transferred into the Affordable Care Act (ACA) Health Insurance Marketplace, many of them first-time users of the program. Part of that growth is likely due to Indiana’s unwinding of Medicaid coverage, or the review of millions of enrolled Hoosiers to redetermine benefits.
“It remains to be seen, but my hope is that the increased ACA enrollment rates reflect people successfully moving into the marketplace and maintaining or continuing coverage,” said Tracey Hutchings-Goetz, the communications and policy director for Hoosier Action.
Nearly 300,000 Hoosiers secured health insurance coverage through the ACA Marketplace during the open enrollment period for 2024, part of the record 21.3 million consumers nationally utilizing the program for the upcoming year.
Indiana’s enrollment increased by 60% — from 185,354 to 295,772 Hoosiers — between 2023 and 2024, the fourth-highest percent increase for signups in the nation, according to an analysis from KFF, an organization with a focus on health care policy.
According to data from the Centers for Medicare and Medicaid Services (CMS), the 21.3 million Americans using the ACA Marketplace included 5 million, or 24%, of people who were new to the process while the remaining 16.3 million were renewals. That data doesn’t yet include a breakdown state-by-state and some states still have open enrollment.
But Hutchings-Goetz shared stories of confusion from enrollees about the process overseen by the Family and Social Services Administration (FSSA) and paperwork errors that terminated their insurance coverage. And the “handoff” between Medicaid and the ACA Marketplace isn’t always smooth.
“We continue to be watching closely, the paperwork errors, system glitches and issues with notices and are continuing to work with FSSA to try to resolve as many of these issues as we can,” Hutchings-Goetz said. “It is entirely incumbent upon the person to go and pursue that additional coverage… So we’re cautiously hopeful that there is a higher number of people maintaining coverage.”
Unwinding COVID-19 Medicaid waivers
During the COVID-19 pandemic, the federal government directed states not to kick anyone off of their Medicaid rolls as millions lost their jobs and insurance coverage in exchange for enhanced federal funds. In Indiana, enrollment swelled from 1.5 million in February of 2020 to over 2.3 million in April of 2023, the last month of protections.
Since that time, the Family and Social Services Administration (FSSA) has reported that it reviewed more than one million Hoosiers’ Medicaid coverage. Of those, just over half — 540,185, or 53% — have been renewed while another 25% — 255,561 — are maintaining their coverage while FSSA reviews their cases.
Indiana is among a handful of states that automatically enroll children in the Children’s Health Insurance Program (CHIP) should they no longer qualify for Medicaid. Prior to the unwinding process, KFF ranked Indiana highly for having policies — such as the above — that encourage continuous coverage.
As of December, there are just over 2 million Hoosiers still enrolled in Medicaid and over 383,000 Hoosiers have fallen off of the Medicaid rolls.
A consistent concern for advocates in the early months of the unwinding process was the high rates of procedural disenrollments, so-called paperwork errors that could deny someone coverage who actually qualified.
“At the end of the day, the majority of our disenrollments continue to be procedural, which means that those people may still be eligible … but due to some paperwork error — materials not getting in by the right deadline or materials getting lost in processing — they’ve been kicked off,” Hutchings-Goetz said. “This can have some pretty devastating consequences for people. We’ve spoken to Medicaid members who, when they lose coverage, they have had to make decisions like rationing medication … they’ve had to cancel doctor’s appointments.”
Nearly one in five Hoosiers previously on Medicaid, 190,834 or 19%, were terminated for procedural reasons. KFF reports that Indiana’s disenrollment rate due to procedural reasons is higher than its peer states, at 81% compared to the national average of 71%.
Members who lose coverage have the right to appeal that decision and Hutchings-Goetz recommended that Hoosiers going through the process utilize the state’s health care navigators.
Of those disenrolled, another 32,910, or 3%, of enrollees were determined ineligible and some of those were transferred to the ACA Marketplace but the state’s breakdown doesn’t include how many.
Could more Hoosiers lose their coverage after the unwinding process?
Hutchings-Goetz flagged another post-pandemic change unrelated to the nationwide process that could impact Hoosier access to insurance: Indiana’s re-introduction of premiums for some Medicaid beneficiaries.
“We’re really concerned about this because everyone who has enrolled in HIP since the pandemic protections has never had to pay premiums so there is a very significant amount of Medicaid HIP member education that needs to happen,” Hutchings-Goetz said.
The Managed Care Entities contracted by the state offer several different types of insurance packages for members but, for those in the Healthy Indiana Plan (HIP), certain Hoosiers can access HIP Plus by making a monthly POWER Account contribution.
Those who make between 100-133% of the Federal Poverty Level, or between $31,200-41,496 for a family of four, are required to make these contributions in order to stay enrolled. This requirement, which impacts between 14-19% of HIP enrollees, was waived during the COVID-19 pandemic.
But FSSA told the CMS that it would bring those charges back sometime in 2024 — something the federal agency had concerns about.
“Evidence on the effects of premiums in Medicaid … suggest that premiums beyond those authorized under Medicaid statute may reduce access to coverage and care among the population that Medicaid is designed to serve,” read a December letter from CMS to FSSA’s Medicaid Director Cora Steinmetz. “Beneficiaries who are subject to premiums appear to experience greater disruptions in Medicaid coverage and exhibit lower initial rates of enrollment.”
CMS noted that between February 2015 and November 2016, over half of all beneficiaries, or 324,840 Hoosiers, required to make POWER contributions missed at least one payment, of which 88%, or 286,914, were put onto HIP Basic and 4%, or 13,550, were disenrolled. The remaining 14%, or 46,176, were those who applied for HIP Plus and were accepted but didn’t make the initial payment.
Several states’ worth of beneficiaries say the process of charging premiums is confusing in addition to the challenge of meeting that monthly payment. But Hutchings-Goetz noted another layer of confusion for Hoosier participants.
“HIP premiums have often been paid by charity organizations on behalf of individuals and that charity network is no longer intact,” Hutchings-Goetz said.
Previously, those organizations included churches, housing advocacy groups and even charitable hospital care programs, she said.
“I think it’s an important part of the story to highlight because we’ve always been told that the reason to have HIP premium payments is that it teaches people to take responsibility for their own health care coverage. But if many of those payments are made by charity organizations on half of individuals because individuals are so confused by the program, then it seems like it is completely failing,” Hutchings-Goetz said.
In the last few years, Congress increased subsidies and struck the premium requirement for individuals making up the 150% of the federal poverty level, or $46,800 for a family of four, in the ACA Marketplace. That means that poorer Hoosiers will be paying premiums while their slightly wealthier peers pay nothing.
This rule also disproportionately cuts off Black Hoosiers, younger enrollees and those with lower incomes, CMS added.
“CMS continues to have concerns with premium requirements…,” the CMS letter said.
The letter concluded by saying that CMS would not take action “act this time … to minimize disruptions to the state’s unwinding efforts” but didn’t rule out future action.
The Indiana Capital Chronicle is an independent, not-for-profit news organization that covers state government, policy and elections.