Medicaid evicted can avoid gap, state told

Federal officials say they will try to prevent a gap in coverage for Arkansans whose Medicaid coverage is being canceled at midnight today because their eligibility was never verified, a spokesman for the state Department of Human Services said Friday.

Affected Arkansans who sign up for coverage on the state's insurance exchange will have coverage as soon as they pay their first month's premium rather than having to wait until July 1 for the coverage to take effect, Human Services Department spokesman Amy Webb said.

"In our conversations with [the federal Centers for Medicare and Medicaid Services], we were told that people who finished the process and were determined eligible for coverage through the exchange, could pay their premiums and get coverage then," Webb said in an email Friday. "We are not involved in the logistics of how this would work and how insurance companies would be notified."

A day earlier, Webb said federal officials "were trying to do it so that people could pay their premiums and go ahead and get coverage and not have to wait until July 1."

Aaron Albright, a spokesman for the federal Centers for Medicare and Medicaid Services, said in an email Friday evening, "We are working with the state to ensure that these individuals are able to gain the correct coverage as soon as possible."

Heather Haywood, a spokesman for the Arkansas Insurance Department, said officials with her department had not yet received word from the federal agency on what provisions would be made to prevent gaps in coverage.

"We have reached out to our state officer and others at [the Centers for Medicare and Medicaid Services] to learn what options are available to help consumers get insurance coverage just as quickly as possible," Haywood said.

The Human Services Department sent notices last week to 4,798 Medicaid enrollees that their coverage will end after today because their eligibility has not been verified.

The enrollees were approved for coverage after submitting applications through the online federal enrollment portal, healthcare.gov. The Centers for Medicare and Medicaid Services sent a data file to Arkansas that named applicants whose eligibility had been verified as well as those whose eligibility had not been verified.

The data file included code indicating the eligibility status of applicants, but state employees didn't know about that code and thought all the applicants listed in the file had been approved, Webb said.

Those who were mistakenly enrolled in Medicaid likely include people being covered by Medicaid-funded private plans under the state's so-called private option, as well as people assigned to the traditional Medicaid program because their health needs are considered exceptional, Webb said.

"We regret that you are now in this position," the notices, dated May 21, say. "Arkansas acted in good faith after receiving initial notification of your eligibility from the federal government. It now appears that those notifications were premature."

The notices direct the enrollees to return to healthcare.gov to supply additional information needed to verify their eligibility before today, saying a failure to do so "could result in a gap in your health insurance coverage."

Many of the enrollees may be found eligible for Medicaid after the additional information is supplied, Webb said. She added that the enrollees should have already received letters from the federal government explaining what additional information is needed.

If they are ultimately found eligible for Medicaid, the enrollees would not face a gap in coverage because the Medicaid program will pay for up to three months of past medical expenses after an applicant is approved.

Those who are ineligible for Medicaid can apply for coverage, along with tax credit subsidies to help pay their premiums, through healthcare.gov.

However, coverage would typically start July 1 for an applicant who applies in late May or early June. The deadline to enroll for coverage starting Sunday was May 15 -- six days before the state Human Services Department sent out the cancellation notices.

Max Greenwood, a spokesman for Arkansas Blue Cross and Blue Shield, said her company had not yet received instructions on the issue from the Centers for Medicare and Medicaid Services.

"Whatever we're told by the feds, that's when their coverage is going to start," Greenwood said.

However, she said the company normally would not know whether an enrollee previously had coverage unless that coverage was under one of her company's plans.

Christy Garrett, a spokesman for Little Rock-based QualChoice Health Insurance, which is also offering plans on the exchange, said in an email, "We will follow the outlined guidelines from the state/federal government regarding eligibility date."

Those mistakenly enrolled are among more than 170,000 people who had been approved for coverage under the expanded Medicaid program as of April 30.

The expansion, approved by the Legislature last year, extended eligibility to adults with incomes of up to 138 percent of the poverty level: $16,105 for an individual, for instance, or $32,913 for a family of four.

Under the private option, most people who are approved for coverage can sign up for a private plan on the exchange, with Medicaid paying the premium and providing additional subsidies to reduce or eliminate the recipient's out-of-pocket costs for medical care.

Those with exceptional health needs are assigned to the traditional, fee-for-service Medicaid program.

The federal government is expected to pay the full cost of providing coverage to those covered under the expanded program until 2017, when Arkansas will begin paying a part of the cost.

Webb has said the state will not attempt to recoup any money from those who were mistakenly approved for coverage, and state officials don't believe that Arkansas will have to reimburse the federal government for payments made on the applicants' behalf to insurance companies or health-care providers.

"We've had several discussions with [Centers for Medicare and Medicaid Services] officials and certainly do not anticipate that the feds would try to recoup any funds from the state related to this issue," Webb said in an email Friday.

A Section on 05/31/2014

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