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The Facts: Why Health Insurance Providers Are Supporting Americans Through Medicaid Redetermination


Published Apr 19, 2023 • by AHIP

Every American deserves access to affordable health coverage and care. Throughout the COVID-19 pandemic, health insurance providers took decisive actions in support of this commitment. That commitment continues today, as health insurance providers have launched new efforts to guide Americans as states confirm whether those enrolled in Medicaid and CHIP are still eligible.

At AHIP, we worked in partnership to initiate an innovative, collaborative effort – the Connecting to Coverage Coalition – with other leading groups, including hospitals and health care providers, employers, patients, and others to minimize coverage disruptions at this critical time. Whether people remain eligible for Medicaid or CHIP,[1] can get insurance through their employer, or qualify for coverage through the individual market, we are working to help them keep and maintain health coverage to protect their health and financial stability.

Some have said that reducing Medicaid rolls would be a good thing, implying that Medicaid managed care organizations (MCO) have not been good stewards of taxpayer dollars. Here are the facts:

  • Medicaid regulations ensure that at least 85 cents of every dollar in Medicaid managed care premiums is spent on health care services and quality improvement.
  • In fact, a recent study shows that average margins for Medicaid MCOs average just 3%. This is substantially lower than most other stakeholders in the health system.
  • Many states reduced Medicaid rates during the pandemic because of lower use of health care. Notably, in California, payment rates to Medicaid MCOs were reduced retroactively back to July 2019 – well before the start of the COVID pandemic.
  • Federal standards require that Medicaid payment rates reflect expected health care use, including estimates of covered enrollees who will not receive any health care services.

Leaving Americans uninsured isn’t good for anyone – not for people and their families, not for rural and underserved communities, and not for the doctors and hospitals that treat them. Americans deserve to have information that is easy to understand on what they need to know, what they need to do, and where they can get health insurance if they no longer qualify for Medicaid.

Health insurance providers will be there to help, standing alongside consumers, providers, and employers, providing coverage choices that are essential for healthier people, healthier families, healthier communities, and a healthier nation.

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[1] CHIP - the Children’s Health Insurance Program