New Indiana Rules Could Lock HIP Enrollees Out Of Coverage For Six Months

Members who fail to renew coverage under Indiana’s Medicaid program will be subject to a six-month suspension period. That’s despite previous notice in 2016 from the federal government that the state can’t enforce such lockouts.

The changes are part of last week’s federal authorization, which allows Indiana to continue operating its program, the Healthy Indiana Plan, for another three years.

Under the new policy, the state will send notices to some HIP enrollees, stating they must complete annual eligibility paperwork in order to maintain their coverage, a process known as redetermination. Members who fail to complete their redetermination by a given deadline will be disenrolled. If they do not meet certain requirements within a 90-day period, they will not be eligible to re-apply for coverage for another three months, resulting in at least six months without coverage.

“We're not in favor of any policy for locking somebody out for something that could be a logistical issue,” said Mark Fairchild, policy director for Covering Kids and Families of Indiana, an insurance advocacy organization.

Even though the lockout policy is new, failing to complete redetermination is currently the most common reason for losing HIP insurance. Nearly 12,500 people lost coverage from August through October 2017 for failing redetermination, according to a recent report released by the state.

Fairchild said many people on HIP 2.0 are transient, in some cases because they suffer from addiction. They might not properly report a change in address, which means they may not even get a notice to renew their coverage in the first place.

“For some consumers, it's an easy item to miss,” he said. “A six-month lockout seems quite severe for what could be somebody missing a piece of mail.”

Fairchild said a lockout for intentional fraud is understandable. “However, if it is due to a logistical oversight or confusion, we’d prefer the administration find another way to address that situation,” he said.

In 2016, Indiana’s legislature codified lockouts for HIP 2.0 members who fail to send in their paperwork on time, but the policy wasn’t implemented. The Indiana Family and Social Services Administrationsent a letter to the federal Centers for Medicare and Medicaid Services in April 2016 justifying the provision, stating it “encourages individuals to maintain health coverage and avoid coverage gaps that interrupt treatment and continuity of care.”

CMS responded in another letter, noting that preventing people from receiving health coverage under Medicaid is “not consistent with the objectives of the Medicaid program, which include ensuring access to affordable coverage.” The letter, which was sent out under the Obama administration, also says poor people may have a hard time completing the paperwork to renew their coverage, and that a loss of insurance could coincide with a major health event.

But under the Trump Administration, the federal government has changed its stance. Seema Verma, who is credited for designing Indiana’s initial waiver proposal, now heads the federal Centers for Medicare and Medicaid Services, the department in charge of Medicaid waiver approvals.

As Side Effects previously reported, some HIP 2.0 members have lost coverage because of administrative errors in the program. Others lose coverage or fail to sign up due to confusion over how the program works.

Adam Mueller, who heads advocacy efforts for Indiana Legal Services, a nonprofit that provides free legal help to low-income people, said that HIP 2.0 members often have problems renewing their coverage. “There’s confusion about whether or not recertification took place, and about whether or not documents were lost,” he said. “That can be very precarious for folks.”

He said that a lockout for failing to complete redetermination could have drastic results.

“If they don’t have access to services, it could be really, really bad for their health,” he said.

In response to criticisms of the lockout policy, the state has said that HIP members will have months to complete the redetermination paperwork, during which they will receive multiple communications from the state and the insurers that help run the program. And the state reiterated claims made in the waiver application: “[T]he open enrollment policy will help to encourage completion of the required redetermination processes which will result in an overall increase in continuity of care for HIP members,” a FSSA spokesman wrote in an email.

This story was produced by Side Effects Public Media, a reporting collaborative focused on public health.