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Jul 5, 2024

by , and

Bethany Pray serves as CCLP's Chief Legal and Policy Officer. Her areas of expertise include regulatory analysis and advocacy for Medicaid and commercial coverage, access to behavioral health benefits, Medicaid eligibility and much more.Staff page ›

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Facing the facts: Advocates present to the JBC on glitch-plagued PHE Unwind

by , and | Jul 5, 2024

Community Insight, COVID-19, Equity work, Family Economic Security, Health, News, Research and Policy Analysis

Hospital surgery corridor. Gurney on the left of the image with no one on it. Doctors are in the background in teal scrubs.

On June 20 the Colorado Health Policy Coalition (CHPC) brought a panel of speakers to the Joint Budget Committee (JBC) to discuss the Public Health Emergency (PHE) Unwind. The PHE Unwind is the process all states have gone through to re-examine eligibility of all Medicaid enrollees. Aiming to underscore the urgency of the situation, CCLP’s Bethany Pray and other coalition members testified on the numerous challenges for Colorado residents, the providers who rely on Medicaid reimbursement to provide care, and the counties who process eligibility.

Colorado has nearly[i] made it through the process of re-examining eligibility for the almost 1.8 million Coloradans who were enrolled in Medicaid during the COVID-19 PHE. Health First Colorado, our Medicaid program, was a lifeline for over 30 percent of Colorado residents, helping Colorado weather COVID-19 and connecting people to low- or no-cost behavioral health care, vaccinations, primary care, medications, and more.

The PHE Unwind has been painful, marked by processing backlogs, inaccurate notices, unprecedentedly high rates of denials, and soaring application rates. Those application rates were largely driven by people who were dropped from coverage despite still meeting program requirements, who were then forced to scramble to regain coverage. While Colorado’s Medicaid coverage policies are more generous than those of many states, endemic operational problems and inefficiencies have prevented those policies from having the intended impact. As of May 2024, Colorado was second in the nation in the percentage of enrollees terminated from coverage.

The PHE Unwind portion of the JBC meeting opened with a presentation by Kim Bimestefer, the Executive Director of the Department of Health Care Policy and Financing (HCPF). HCPF is the state agency responsible for administering Medicaid. Following questions by members of the JBC, CCLP’s Bethany Pray presented on the data around the PHE Unwind and the state’s inefficient processes. She was followed by Megan Bowser, a parent of a child with disabilities and the incoming Executive Director of Family Voices Colorado, explaining the enrollee perspective; Laura Luzietti, a pediatrician and Executive Director of Every Child Pediatrics on the impact on providers; and Jamie Ulrich, Human Services Director of Weld County, bringing county insights.

Ms. Pray’s testimony affirmed that all stakeholder groups, including residents, providers, and county employees, are hampered by old technology and overly complex processes. She urged policy makers –- the legislature and administration – to take a clear-eyed look at the dysfunction of our Medicaid eligibility system.

CCLP believes it is imperative that the state of Colorado find a path to a more efficient Medicaid system that can keep eligible people enrolled, support a robust provider network, and allow counties to function smoothly. What we don’t need is a positive spin on the situation, which merely obscures the truth.

More detail on CCLP’s presentation and the sources behind it can be found in this outline of CCLP talking points. Because time was short — with just 30 minutes available for the entire CHPC panel — there was little chance to debunk misleading information offered by the Department. We offer more detail on those points in the Fact Check! below. And for a deeper analysis of data regarding the minimum wage and Medicaid eligibility, be sure to check out CCLP’s new Issue Brief: Medicaid Eligibility and Wages.

Fact Check!

#1: There is no basis to believe that a large number of people have lost coverage because they transitioned to employer-based coverage.

#2: There is no basis for the claim that unemployment rates account for the differential between state disenrollment rates or that Colorado’s employment rate “has been stronger throughout the … PHE Unwind.”

  • In fact, Colorado’s unemployment rate rose slowly but steadily through the PHE Unwind, from 3.1% in May 2023 to 3.8% in May 2024.
  • Colorado currently ranks 38th for its unemployment rate. Unemployment is higher in Colorado than in most other states.
  • HCPF cites outdated February 2020 information when talking about unemployment.
  • In CCLP’s analysis, unemployment rates do not correlate with Medicaid enrollment, though that might seem logical. In fact, we see evidence that increasing unemployment rates are correlated with declining Medicaid enrollment across the country since the start of the PHE. While this may seem counterintuitive, the implications is that other factors are behind the declines in Medicaid enrollment we’ve seen in states across the country.

#3: There is no basis for the claim that Colorado’s higher minimum wage is the cause of Colorado’s high termination rate.

  • In CCLP’s analysis, increases in Colorado’s minimum wage since 2019 have had minimal impact on the size of the Medicaid-eligible population.
  • In many cases, single-adult and two-adult households working 35 hours at the minimum wage were not eligible for Medicaid in 2019. If the minimum wage had any effects on disenrollment from higher wages, that impact would have occurred well before the start of the PHE.
  • In CCLP’s analysis, there was no clear correlation between the minimum wage level of a state and Medicaid rolls, though that might seem logical. (See CCLP’s Issue Brief: Medicaid Eligibility and Wages for more.)
  • According to KFF, states that have seen some of the highest rates of Medicaid disenrollment since the start of the PHE have minimum wages of $7.25/hour, the federal minimum — if Colorado’s higher minimum wage is driving our high disenrollment rates, why do we see similarly high rates in states with lower minimum wages?

#4: Comparisons between denial rates in May 2024 and rates during the PHE Unwind are misleading.

  • Denial rates in May 2024 can’t be compared with earlier months because they reflect only terminations for the income-based population. In April 2024, HCPF instituted a policy that kept Coloradans with disabilities (a large group of at least 80,000 people) automatically maintained in Medicaid. (This is because case management system changes during the PHE Unwind resulted in a flood of problems for people with disabilities.)  The result is that May 2024 denial rates are not comparable to other months.
  • Hundreds of thousands of people have lost coverage since May 2023. If these high rates of disenrollment were to continue, it would take less than a year (May 2025) for Colorado to have zero Medicaid enrollees.
  • Even so, as unemployment continued to edge up, over 12,000 people lost coverage in May 2024 for reasons other than voluntary withdrawal.

#5: It is false that our current enrollment is higher than it was pre-pandemic.

#6: It is not simply “good news” that people who are eligible but lose Medicaid often return to coverage.

  • Such a statement would be equivalent to a statement that moving on and off Medicaid, a concept known as “churn,” is good — though it is expensive for counties and damaging to the health of Coloradans.
  • HCPF reports that a third of those who lost coverage returned to Medicaid. This suggests that at least a third of the people that are being disenrolled have demonstrated that they should never have been disenrolled in the first place — a clear signal of an ineffective eligibility process, not a sign of good news.
  • Our analysis of changes to Medicaid enrollment in states across the country indicates that states who managed to maintain a smaller share of beneficiaries whose coverage was terminated for a procedural or administrative reason also saw a smaller decrease in their Medicaid enrollments.

#7: Returning to the pre-pandemic status quo would not be a positive state of affairs.

  • There was a steady loss in Medicaid coverage before the pandemic. Despite the lack of supporting evidence, HCPF attributes that to a strong Colorado economy between 2016 and 2019.
  • CCLP’s analysis in 2019 attributed some of those losses to administrative burdens, including defective Medicaid communications and the state’s returned mail policy.
  • The rate of churn in Colorado — eligible people being terminated and having to come back on — was substantial before the unwind.

#8: State policy expansions should have yielded higher enrollment in 2024 than in 2020.

  • Since February 2020, more people became eligible for Medicaid because certain policy changes have yielded higher enrollment, including the following:
  • Meanwhile, enrollment for income-eligible children has dipped by more than 40,000 individuals. Enrollment for very low-income parents — those up to just 68% of the federal poverty level — has dropped by almost 20,000 people.
  • Economic mobility is not a likely cause: It is more common in the US, especially for Black and Latinx residents, to move down the economic ladder than it is to move up from lower income tiers.

#9: State policies, procedures, and administrative factors appear to have had a stronger impact than economic factors on Medicaid enrollment.

  • CCLP’s analysis of changes in states’ Medicaid enrollment suggests there is a correlation between states who took advantage of more flexibilities offered by CMS, the federal agency (in the form of waivers), and lower disenrollment rates.
  • CCLP found that states with fewer terminations due to procedural or administrative reasons have higher Medicaid enrollment have seen overall less loss of coverage since the start of the PHE.
  • These variables had much stronger statistical significance than economic factors we looked at, including unemployment rates and minimum wages.
  • Unemployment has been rising in most states, while Medicaid enrollment has been dropping as states unwind. As a result, unemployment is not a useful indicator of expected enrollment—contrary to what HCPF has been suggesting.

**********

[i] The Unwind is not technically complete because of an April 2024 pause on terminations for people with disabilities.

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HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

Health First Colorado is the name given to Colorado’s Medicaid program. Medicaid provides public, low-cost health insurance to qualifying adults and children. It is an entitlement program funded by the federal, state, and county governments and is administered by counties in Colorado. Those who are required to pay must pay a small co-pay when receiving certain health care services.

State Department: Department of Health Care Policy and Financing

Eligibility: Most adults 18 to 64 are eligible for Medicaid in Colorado if their household income is at or below 133% of the federal poverty limit (FPL). Pregnant women are eligible with incomes of up to 195% FPL, while children under 18 may be eligible if the live in a household with income at or below 142% FPL. Some adults over 65 may also be eligible for Medicaid.

Program Benefits: Through Medicaid, low-income Coloradans are eligible for a range of health care services at little to not cost. Services provided include doctors visits, prescription drugs, mental health services, and dental care. Co-pays for certain individuals may be needed for certain services.

Program Funding and Access: Colorado funds our Medicaid program through state and federal dollars. Medicaid is an entitlement program, which means that all who are eligible for Medicaid can access the program, regardless of the funding level in a given year. This does not mean that it is always easy to access Medicaid, even when eligible. And since the program is administered by counties, funding levels for county staff and other administrative roles can make it easier or harder for Coloradans to access the program. On top of this, not all medical providers accept Medicaid which limits the ability of Coloradans to seek health services even if enrolled, such as if the nearest provider is a 2+ hour drive away.

Note: This data is from before the pandemic and does not reflect changes in enrollment rules during the COVID-19 pandemic and public health emergency.

Statewide Program Access 2015-19: Over the study period of this report, an average of 89.0% of the population at or below 133% of FPL (i.e., the population who is likely to be eligible for Medicaid) were enrolled in Medicaid in Colorado.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

The Supplemental Nutrition Assistance Program or SNAP helps low-income Coloradans purchase food by providing individuals and families with a monthly cash benefit that can be used to buy certain foods. SNAP is an entitlement program that is funded by the federal and state governments and administered by counties in Colorado.

State Department: Department of Human Services

Eligibility: Currently, Coloradans qualify for SNAP if they have incomes below 200% FPL, are unemployed or work part-time or receive other forms of assistance such as TANF, among other eligibility criteria. Income eligibility for SNAP was different during the study period of this report than today—it was 130% FPL back in 2019 for example. The US Department of Agriculture uses the population at or below 125% FPL when calculating the Program Access Index (or PAI) for SNAP. We follow this practice in our analysis despite Colorado currently having a higher income eligibility threshold.

Program Benefits: SNAP participants receive a monthly SNAP benefit that is determined by the number of people in their household and their income. Benefit amounts decrease as income increases, helping households avoid a sudden loss of SNAP when their incomes increase, even by a minor amount. Benefits are provided to an Electronic Benefit Transfer (EBT) card that can be used to purchase eligible food items, such as fruits and vegetables; meat, poultry, and fish; dairy products; and breads and cereals. Other items, such as foods that are hot at their point of sale, are not allowable purchases under current SNAP rules.

Program Funding and Access: SNAP, like Medicaid, is a federal entitlement program. This means that Colorado must serve any Coloradan who is eligible for the program. As such, funding should not be a limit to how many Coloradans can be served by the program. However, funding for administration of SNAP at the state and county level can limit the ability of county human service departments to enroll those who are eligible. Other program rules and administrative barriers can make it difficult for Coloradans to receive the benefits they are legally entitled to receive.

Statewide Program Access 2015-19: Over the study period of this report, an average of 61.1% of the population at or below 125% of FPL (i.e., the population who is likely to be eligible for SNAP) were enrolled.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

The Special Supplemental Nutrition Program for Women, Infants, and Children, also know as WIC, provides healthcare and nutritional support to low-income Coloradans who are pregnant, recently pregnant, breastfeeding, and to children under 5 who are nutritionally at risk based on a nutrition assessment.

State Department: Department of Public Health and Environment

Eligibility: To participate in WIC you must be pregnant, pregnant in the last six months, breastfeeding a baby under 1 year of age, or a child under the age of 5. Coloradans do not need to be U.S. citizens to be eligible for WIC. In terms of income, households cannot have incomes that exceed 185% FPL. Families who are enrolled in SNAP, TANF, Food Distribution Program on Indian Reservations (FDPIR), or Medicaid are automatically eligible for WIC. Regardless of gender, any parents, foster parents, or caregivers are able to apply for and use WIC services for eligible children.

Program Benefits: WIC provides a range of services to young children and their parents. These include funds to purchase healthy, fresh foods; breastfeeding support; personalized nutrition education and shopping tips; and referrals to health care and other services participants may be eligible for.

Program Funding and Access: WIC is funded by the US Department of Agriculture. The state uses these federal funds to contract with local providers, known as WIC Clinics. In most cases, these are county public health agencies, but that is not the case in all Colorado counties. Some WIC Clinics cover multiple counties, while others are served by multiple clinics. Private non-profit providers are also eligible to be selected as a WIC Clinic.

Statewide Program Access 2015-17: Between 2015 and 2017, an average of 52.2% of the population eligible for WIC were enrolled in the program in Colorado.

Financial Security:
Colorado Works

Colorado Works is the name given to Colorado’s program for Temporary Assistance to Needy Families or TANF. It is an employment program that supports families with dependent children on their path to self-sufficiency. Participants can receive cash assistance, schooling, workforce development and skills training depending on the services available in their county.

State Department: Department of Human Services

Eligibility: In general, Coloradans are eligible to enroll in TANF if they are a resident of Colorado, have one or more children under the age of 18 or pregnant, and have very low or no income. For example, to be eligible to receive a basic cash assistance grant through TANF, a single-parent of one child could not earn more than $331 per month, with some exclusions—and would only receive $440 per month (as of 2022). That said, there are other services provided by counties through TANF that those with incomes as high as $75,000 may be eligible for. In addition to these, participants in TANF are required to work or be pursuing an eligible “work activity” or work-related activity. Any eligible individual can only receive assistance if they have not previously been enrolled in TANF for a cumulative amount of time of more than 60 months—this is a lifetime limit that does not reset. Counties may have additional requirements and offer benefits that are not available in other counties in Colorado.

Program Benefits:  While the exact benefits that one is eligible for under TANF can vary, all qualified participants are eligible to receive a monthly cash payment, call basic cash assistance. Other than cash assistance, counties are have a lot of choice in how to use their TANF funding; generally a use of TANF funds is appropriate so long as it advances one or more of the four purposes of the program: (1) provide assistance to needy families so that children can be cared for in their own homes or in the homes of their relatives; (2) end the dependence of needy families on government benefits by promoting job preparation, work, and marriage; (3) prevent and reduce the incidence of out-of-wedlock pregnancies; and (4) encourage the formation and maintenance of two-parent families.

It is important to note that those eligible for TANF are also eligible for many of the other programs we’ve included in this report, such as SNAP, Medicaid, and CCCAP.

Program Funding and Access: Colorado funds its TANF program through funds received from the federal government through the Temporary Assistance for Needy Families block grant. Most of the federal funds are allocated by the state to counties, which are required to provide a 20% match of state funding. Federal and state rules allow the state and counties to retain a portion of unspent funds in a TANF reserve.

Statewide Program Access 2015-19: Over the study period of this report, an average of 50.7% of the population at or below 100% of FPL (i.e., the population who is likely to be eligible for TANF) were enrolled in TANF in Colorado.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

The Colorado Child Care Assistance Program provides child care assistance to low-income families and caregivers living in Colorado in the form of reduced payments for child care. It is a program funded by the federal, state, and county governments and is administered by counties in Colorado. The share owed by parents/caregivers is determined on a sliding scale based on the family’s income.

State Department: Department of Early Childhood Education

Eligibility: Counties set eligibility for families separately, but must serve families with incomes at or below 185% of the Federal Poverty Limit. Families accepted to the program are no longer eligible once their income exceeds 85% of the state median income. Parents or caregivers must be employed, searching for work, or engaged in another approved activity to be eligible for CCCAP. Parents and caregivers enrolled in Colorado Works (Temporary Assistance to Needy Families or TANF) or in the child welfare system are also eligible to participate in CCCAP. Generally, CCCAP serves families with children under 13, although children as old as 19 may be eligible under certain circumstances.

Program Benefits: If a family is eligible for CCCAP and has income, they may likely have to pay a portion of their child’s or children’s child care costs each month. The amount that families owe is based on their gross income, number of household members, and the number of children in child care in the household. As such, households tend not to experience a benefit cliff with CCCAP when they see their incomes increase

Program Funding and Access: Colorado funds the CCCAP program using federal dollars it receives from the Child Care and Development Block Grant program. The state allocates federal and state funds to counties using a formula that takes into account factors like current caseloads and the number of eligible residents. Assistance is available until the county’s funds are spent, so the number of families that can be served is often a function of how much funding is available and the income and composition of the household that applies. It is not uncommon for counties to overspend or underspend their allocations of funds. The state reallocates unspent funds from counties who underspent to those who overspent. While underspending could indicate a problem with the way a county administers its CCCAP program, it could just as likely be a sign that there are few providers in the county who participate in CCCAP—or a lack of providers generally.

Statewide Program Access 2015-19: Over the study period of this report, an average of 10.8% of the population at or below 165% of FPL and younger than age 13 (i.e., the population who is likely to be eligible for CCCAP) were enrolled in CCCAP.

Housing:
HUD rental assistance programs

The US Department of Housing and Urban Development (HUD) has three housing assistance programs that we look at together: Housing Choice Vouchers (Section 8), Project-based Section 8, and Public Housing. In Colorado, these programs provided assistance to over 90% of the households who received federal housing assistance from all HUD programs. Through federally funded, local or regional public housing agencies (PHAs) are the agencies that administer these programs, through not all are available in all counties. These are not the only programs available in Colorado that assist households afford the cost of housing, such as units funded through federal and state tax credit programs.

State Department: Department of Local Affairs

Eligibility: Generally, households with incomes under 50% of the area median income (AMI) of the county they live in are eligible for these rental assistance programs, although PHAs have discretion to select households with incomes at higher percentages of AMI. That said, HUD requires that 75% of new vouchers issued through the Housing Choice Voucher/Section 8 program in a given year are targeted to households with incomes at or below 30% of AMI. PHAs are also able to create criteria that give priority to certain types of households who are on waiting lists for these programs.

Program Benefits: These rental assistance programs help households afford the cost of housing by reducing their housing costs to around 30% of their household income. In the case of the Housing Choice Voucher program, the PHA pays the voucher holder’s landlord the remaining portion of the rent.

Program Funding and Access: Funding and access are both challenges for these rental assistance programs. In addition to limitations on the number of public housing units or housing vouchers a PHA can manage or issue, lack of funding compared to the need constrains the ability of PHAs to assist low-income households. In 2020, Coloradans were on waitlists for Housing Choice Vouchers for an average of 17 months. Waitlists also exist for the other rental assistance programs.

Statewide Program Access 2015-19: Over the study period of this report, an average of 21.1% of renter households with incomes at or below 50% AMI (i.e., the population who is likely to be eligible for HUD rental assistance programs) were living in subsidized housing.