Dec, 22, 2023

HHS and CMS Take Action to Preserve Coverage for Eligible Children

Kinda Serafi and Kaylee O’Connor, Manatt Health

On December 18, 2023, the Centers for Medicare & Medicaid Services (CMS) released a suite of Medicaid unwinding-related guidance and enrollment data that includes a focus on ensuring eligible children maintain Medicaid and Children’s Health Insurance Program (CHIP) coverage. In conjunction with CMS’ release, the United States Department of Health and Human Services (HHS) sent letters to the governors of nine states with the highest child disenrollment rates by number and percentage—Arkansas, Florida, Georgia, Idaho, Montana, New Hampshire, Ohio, South Dakota, and Texas—which accounted for 60% of the decline in children’s Medicaid and CHIP enrollment between March and September 2023. The letters encourage the nine states to adopt certain strategies, depending on the identified state-specific deficiencies, to mitigate coverage loss for eligible children.[1]

CMS’ Children-Specific Resources Include:

  • A Center for Medicaid and CHIP Services (CMCS) Informational Bulletin focused on promoting continuity of coverage for children. The Informational Bulletin reminds states of the federal renewal requirements and encourages states to adopt additional child and family-focused strategies, such as conducting outreach to children and youth with special healthcare needs, supporting seamless transitions across programs, adopting available federal authorities and flexibilities, strengthening community partnerships, and implementing reporting and monitoring processes. Notably, the guidance: (1) extends all unwinding-related section 1902(e)(14) waivers through December 31, 2024;[2] and (2) encourages states to consider utilizing section 1902(e)(14) waiver authority to extend renewals for children for up to 12 months to prevent procedural disenrollments—mirroring recent actions taken by North Carolina and Kentucky.[3]
  • A data snapshot highlighting enrollment trends among children and youth through September 2023. CMS finds that, despite children having higher eligibility levels than adults, Medicaid and CHIP-enrolled children are being terminated from coverage at a rate similar to that of Medicaid-enrolled adults (5.3% or 2.2 million and 5.8% or 2.9 million, respectively). Additionally, CMS presents findings that both higher rates of ex parte renewals[4] and uptake of unwinding flexibilities are associated with a smaller decrease in enrollment for children under age 19. In states that have not expanded Medicaid, youth ages 19 to 23 make up a greater share of disenrollments, as they are more likely to fall into the coverage gap. Among the children who have been terminated from Medicaid or CHIP between April 1, 2023 and June 1, 2023, roughly 20% have reenrolled.

CMS’ Broader Unwinding-Related Resources Include:

  • A slide deck providing guidance and illustrative scenarios for when children transition from Medicaid to CHIP (and vice versa) and when individuals transition within Medicaid eligibility groups. When children are enrolled in Medicaid but appear eligible for CHIP based on an ex parte review but do not return their renewal form, CMS strongly encourages states to enroll the child in CHIP based on the available information rather than terminate coverage. The slide deck also emphasizes that states may not move individuals who are currently receiving full Medicaid to a more limited eligibility group without first sending the individual a renewal form and requesting additional information.[5]
  • A resource providing states with operational considerations and illustrative scenarios for implementing section 1902(e)(14) waivers and other flexibilities, building on CMS’ June compilation of strategies to reduce procedural disenrollments.[6] CMS identifies the following strategies as the most effective in improving ex parte rates and reducing risk of procedural terminations for children: the Targeted Supplemental Nutrition Assistance Program/Temporary Assistance for Needy Families Strategy, the Beneficiaries with No Income Renewal Strategy, and the Beneficiaries with Low Income Renewal Strategy.
  • A data snapshot highlighting enrollment trends in Medicaid, CHIP, and the Marketplace through September 2023. Since the start of unwinding, enrollment in Medicaid and CHIP has decreased by approximately 5.4 million individuals (down to 88.5 million); however, many of the individuals who are losing Medicaid or CHIP appear to be transitioning to Marketplace coverage. Marketplace enrollment has increased by over 1.5 million individuals since March 2023, and is up by 100,000 individuals from the same time last year.


Together, HHS’ letters to states and CMS’ resources represent a coordinated effort to prioritize coverage retention for eligible children and continue supporting states with their enrollment and renewal processes in the post-public health emergency era.


[1] For more information on CMS’ unwinding enforcement authorities, see this State Health and Value Strategies and Manatt Health expert perspective on the December 6, 2023 interim final rule with comment period.

[2] CMS will allow states to request new waiver authorities through December 31, 2024. CMS also notes that it is assessing the impact of the section 1902(e)(14) waivers to determine which may be implemented under other federal authorities, and additional “guidance on the continued availability of these strategies is forthcoming.”

[3] Section 1902(e)(14)(A) of the Social Security Act allows states to request authority for waivers “as are necessary to ensure that states establish income and eligibility determination systems that protect beneficiaries.” 

[4]Ex parte” refers to verifying eligibility based on a review of available data sources without needing to send a renewal form and request information/documentation from the enrollee.

[5] While this is currently a state option, CMS’ “Streamlining the Medicaid, Children’s Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes” proposed rule would make this a requirement. For more on the proposed rule, see the State Health and Value Strategies and Manatt Health expert perpsective CMS Proposed Rule on Medicaid and CHIP Eligibility, Enrollment, and Renewal.

[6] “Procedural disenrollment” refers to a termination of eligibility and disenrollment from Medicaid for reasons that are unrelated to a state’s determination of whether the individual meets eligibility criteria to qualify for coverage, including for failure to return a renewal form or documentation needed to make a determination of eligibility.