Report: Enrollment Volatility High, Costly To State

The Massachusetts Medicaid Policy Institute just issued a new report on the phenomenon of enrollees cycling on and off the state health insurance programs, Commonwealth Care and MassHealth.

The study's lead author, Bob Seifert of the University of Massachusetts Medical School Center for Health Law and Economics, says the data suggests that the level of volatility in the system is high, and that many people appear to be losing insurance coverage for short periods. Those gaps in health care coverage (which can be hightly detrimental) are due, at least in part, to people losing eligibility because they are failing to comply with administrative requirements, Seifert said. He adds that the state is starting to address the problem of unecessary volatility by attempting to streamline and simplify the eligibility rules.

Here are the key findings of the report:

The consequences for those who encounter even a temporary loss of their health insurance coverage are extensive, significant, and often detrimental.

People who experience a coverage gap of any length face substantial barriers to accessing affordable, quality care and are at risk for incurring medical debt. Massachusetts compares favorably with available national data and data from selected states on rates of enrollment volatility.

Analysis of data from 2008 and 2009 shows that, in an average month, more than 12,000 individuals who were disenrolled for an administrative reason within the preceding 90 days were re-enrolled in either Commonwealth Care or MassHealth. This pattern suggests that many individuals probably remained financially eligible despite losing coverage for administrative reasons. The administrative costs associated with each enrollment are estimated to be about $200 per enrollee, per enrollment cycle, so there is some savings to be realized if this type of disenrollment could be reduced.

Transitions between programs also create gaps in coverage. For example, among the three programs for which MassHealth determines eligibility (MassHealth, CommCare and Health Safety Net), an average of 9,800 people per month moved onto MassHealth from the other two programs from January 2008 through April 2009, and 9,400 per month moved onto CommCare from MassHealth and the HSN. More than 15 percent of those individuals experienced a gap in coverage.

Federal rules and prudent program management require that the state have systems in place to assure that only eligible individuals are covered in MassHealth and CommCare, and these imperatives may conflict with efforts to increase continuity of coverage.

Massachusetts is actively working to improve its administrative processes to promote enrollee retention. The state has developed an action plan that aims to increase retention, improve data use and capacity, and improve customer service through innovations such as use of pre-printed forms that only require a response if circumstances have changed and implementation of less frequent eligibility determinations.