A Strategic Vision for Medicaid And The Children’s Health Insurance Program (CHIP)

Protecting and strengthening Medicaid and the Children’s Health Insurance Program (CHIP) is a critical priority for the Biden-Harris Administration. Medicaid and CHIP provide essential health care coverage for over 80 million individuals and families, including low-income adults, over 40 percent of all children in the United States, older adults, and people with disabilities. Medicaid also covers 42 percent of all births in the nation. Two-thirds of these births are to Black, Hispanic, or American Indian/Alaskan Native people.

In addition to providing coverage of physical health care, Medicaid is the largest payer for long term services and supports, including home and community-based services (HCBS), which allow individuals with a range of disabilities and needs to thrive and live independently at home or in their communities. Medicaid is also the largest payer for public mental health services, including for individuals with serious mental illnesses, substance use disorders, or co-occurring disorders.

Over the past several months, our Centers for Medicare & Medicaid Services (CMS) teams, including the Center for Medicaid and CHIP Services (CMCS), have met with a wide array of stakeholders to listen to their perspectives about what works well in Medicaid, as well as about what to improve in the program. We have heard from advocates, health care and other safety net providers, and health plans. We have had working sessions and individual discussions with our partners in the states and territories. We have heard ideas from our dedicated staff. And most importantly, we have heard from individuals and families about their experiences with Medicaid and CHIP.

It is clear from these discussions that Medicaid works. Covering nearly 1 in 5 Americans, Medicaid is the single largest health coverage program in the U.S., providing robust benefits with little to no out of pocket costs. Medicaid coverage in and of itself is critical to health equity. It is estimated that the Affordable Care Act’s (ACA’s) expansion of Medicaid alone saved the lives of over 19,200 adults age 55 to 64 in just the first four years. During the COVID-19 public health emergency, Medicaid has been a lifeline for millions who have been able to keep health coverage and obtain needed health services.

The Medicaid program is also a beacon of innovation and empowerment of local, on-the-ground voices to shape how the program runs, state by state. It is one of the most unique and successful federal-state partnerships, jointly funded by federal and state/territory governments and operated by 56 states and territories within federal guidelines. It also operates in close collaboration with frontline providers and other partners, be they large health systems, individual clinicians, home health workers, health plans (who serve 70 percent or more of Medicaid members through comprehensive managed care), advocates, or local organizations.

At the same time, we have a tremendous opportunity to protect, strengthen, and expand Medicaid in a number of areas. Eleven years after the ACA, 4 million adults across 12 states still do not have access to Medicaid. Millions more are currently eligible for Medicaid but struggle to enroll and stay covered. Those who do maintain Medicaid coverage may experience challenges accessing providers and medical services greater than those faced by enrollees in Medicare or private insurance, despite the statutory access protections afforded to people enrolled in Medicaid.

Finally, our most pressing immediate priority continues to be supporting states, providers, and other organizations on the ongoing COVID-19 pandemic response, including encouraging uptake of COVID-19 vaccines for the Medicaid population across the age continuum.

Addressing these issues and building a better Medicaid program requires a clear vision for the road ahead and close working relationships across public and private partners. Here, we begin to lay out a new vision for Medicaid and what we plan to accomplish under the Biden-Harris Administration.

Strategic Priorities

Our proactive policy agenda for CMCS focuses on three key areas: Coverage and Access, Equity, and Innovation and Whole-person Care. Under each area, we are committed to pursuing this policy agenda for Medicaid and CHIP in actionable, measurable ways. These three key areas also align with the larger vision for CMS as a whole and the agency’s six strategic pillars.

Working alongside states is essential to executing this agenda, as is recognizing the operational, fiscal, and other realities at the state level. We are committed to providing the active communication, support, and tools that states need to be full partners in operating and improving the Medicaid and CHIP programs to advance these strategic focus areas. This includes actionable, timely technical assistance and guidance navigating cross-cutting policies, and funding support where appropriate. What’s more, this partnership is not limited to states. CMCS will also pursue every avenue to engage with providers and other stakeholders, especially people and their families who are covered by Medicaid and CHIP.

For all three focus areas, collecting, understanding, and using data is essential, as is making this information transparent to stakeholders. This includes prioritizing collection of data on race, ethnicity, language, disability status and other factors, and using those data to identify disparities in access, health outcomes and quality of care. We can also build on existing efforts to provide new and more transparent data on access, quality and experience of care across both fee-for-service and managed care delivery systems. And ultimately, we need to make it easier for eligible people to enroll in Medicaid and CHIP and keep their coverage. That’s why partnering with states to improve data collection and modernize eligibility and other systems is key to ensuring that all individuals can access and maintain their coverage more easily, while preserving program integrity. That means making sure we are paying the right provider the right amount for services and people covered under our programs—protecting people under care while also minimizing unnecessary burden on providers.

Focus Area 1: Coverage And Access

We will use every lever available to protect and expand coverage for all eligible people and to adopt a broad view of access to care that includes provider availability, quality, culturally and linguistically competent care, and reductions in gaps in coverage. This focus area is also guided by the CMS strategic pillar of building on the ACA, and expanding access to quality, affordable health coverage and care.

Protect Access To Coverage After The COVID-19 Continuous Coverage Requirement Ends

We are highly focused on making sure eligible people maintain coverage after the COVID-19 public health emergency ends. Between the onset of the public health emergency and May 2021, Medicaid and CHIP enrollment grew 15 percent, from 71 million to more than 82 million people, the largest increase over 18 months in the program’s history. This is in part due to Congressional action that ensured states would keep people with Medicaid enrolled for the duration of the public health emergency. Once this continuous coverage requirement ends, states will have 12 months to conduct eligibility renewals for everyone enrolled in Medicaid and CHIP; states must either renew enrollees’ Medicaid/CHIP coverage or connect them to low- or no-cost Marketplace coverage.

Keeping eligible people covered is a top priority for the Biden-Harris Administration. To support states with this effort, CMCS is working in close partnership with the Center for Consumer Information and Insurance Oversight to launch a multi-pronged, cross-government collaboration. The goal is to help states in their efforts to plan for the large number of eligibility redeterminations that will be required, minimize unnecessary losses of coverage, and ensure that people who are no longer eligible for Medicaid or CHIP can successfully enroll in Marketplace coverage. Regardless of the program for which people are eligible, we want to make enrollment in affordable coverage as easy as possible. We are:

• Creating guidance, planning tools and other resources to support states in their planning efforts, including guidance released in August providing states with 12 months (instead of just 6 months) to conduct redeterminations.
• Collaborating closely with state Medicaid and CHIP agencies to plan and prepare through regular workgroups, all-state calls, and extensive individualized technical assistance.
• Engaging stakeholders (including local community-based organizations, enrollment assisters, health centers and others) on an ongoing basis so that individuals enrolled in Medicaid and CHIP have support to complete the renewal process, and working across CMS to improve transitions for people no longer eligible for Medicaid or CHIP to subsidized Marketplace coverage.

Health plans, which already help to deliver care to 70 percent of the Medicaid and CHIP population, are also critical partners in our efforts to maximize access to coverage after the public health emergency ends. We will work side-by-side with Medicaid managed care plans and health plans on the Marketplace to take every possible action to help people and their families to maintain health care coverage.

Close The Coverage Gap

There are nearly 4 million people with incomes below 100 percent of the federal poverty level (FPL) who live in a state that has not expanded Medicaid. Millions of people fall into the “coverage gap”—they are Americans who qualify for neither Medicaid nor subsidized coverage through the individual Marketplace because they have income above their state’s Medicaid eligibility limit but below the 100 percent FPL minimum for subsidized Marketplace coverage. We know that people who are uninsured are more likely to delay care, have medical debt, and experience higher rates of mortality. We also know they are disproportionately people of color. As a result, closing the coverage gap is one of the most important actions we can take for health equity.We are excited to support states that have recently expanded Medicaid. Oklahoma expanded Medicaid on July 1, and as of November 9 the state has enrolled over 210,000 newly-eligible individuals. In October, Missouri kicked off its expansion effort and estimates that an additional 275,000 people are eligible to enroll. We stand ready to partner with any state that has not already done so to expand Medicaid and provide critical health care coverage for this population.

Increase And Strengthen Eligibility And Enrollment

Too often, people who are eligible for Medicaid or CHIP are deterred by unnecessary administrative red tape when they try to enroll or maintain their coverage. In 2018, roughly 17 percent of people who lost Medicaid or CHIP coverage (close to 3 million people) re-enrolled within three months.

We must make it easier for eligible people to enroll in and maintain Medicaid and CHIP coverage. Our first goal is to improve eligibility and enrollment data collection and related systems so that states are able to ensure all eligible people can access and maintain their Medicaid coverage. The period after the continuous coverage requirement ends is an opportunity to support states in developing long-term solutions to reduce administrative churn (where individuals lose their Medicaid coverage for administrative reasons, as opposed to being ineligible); examples include improving the use of administrative data for renewals (known as the ex parte renewal process) and eliminating onerous documentation requirements. It also is an opportunity for CMS to engage health plans about outreach and renewal efforts at the federal level, and to encourage states to adopt digital outreach strategies nationwide.

In the longer term, we must partner with states to move Medicaid off a largely paper-based approach to engaging with enrollees. Adopting mobile, email, and other digital communication approaches will reduce how frequently people lose coverage because they did not receive a critical Medicaid eligibility renewal letter in the mail. Lastly, the ACA simplified eligibility and enrollment policies for non-disabled individuals under age 65; we will finish what the ACA started by bringing those same improvements to our elderly and disabled populations.

Protect And Expand Access To Care

Medicaid is not only the largest single health coverage program in the country but also provides reliable access to care. However, we can do more to ensure that people with Medicaid coverage can rely on high-quality care when they need it. To this end, we will explore policies to create a uniform minimum standard for Medicaid and CHIP enrollees across the country. There have been many past efforts to improve access, to varying degrees of success. Moving forward, we aim to define a federal “floor” for health care access while continuing to support state and local initiatives to improve. This must be done thoughtfully and in partnership with states. Our new strategy will embrace a broad perspective to include access to enrollment and providers, as well as linguistically and culturally appropriate care for both our fee-for-service and managed care delivery systems, and for those who rely on critical HCBS to support their activities of daily living.

Broaden Access To HCBS

HCBS gives older adults and people with disabilities the choice to stay in their homes and communities while receiving critical health, functional and social supports, rather than moving to an institutional setting. With Medicaid as the primary payor of HCBS in the nation, CMCS understands the challenges faced by enrollees seeking HCBS, with tremendous variation in access and quality across states and a nationally understaffed and underpaid workforce.

We are currently supporting states as they invest $12.7 billion from the American Rescue Plan (P.L. 117-2) to improve local HCBS services and begin investment in needed structural changes (visit CMCS’s website to view states’ HCBS spending plans). We will continue to work with Congress and other federal partners to advance HCBS improvement and reform and to make continued investments in this area.

Additionally, in 2014, CMS published the HCBS settings rule, which provides additional protections to HCBS program participants and ensures they have full access to the benefits of community living. The Biden-Harris Administration is committed to the settings rule and to working with advocates and beneficiaries to implement it.

Focus Area 2: Equity

We are dedicated to measuring disparities and making targeted, evidence-based investments in improving health equity. While Medicaid is a driver of health equity, the data tell us that significant racial disparities within Medicaid persist. Advancing health equity is a key priority for the Biden-Harris Administration and also a CMS strategic pillar. Health equity will be at the forefront of all policy decisions for Medicaid, not an afterthought.

Make Bold Investments In Equity

On January 20, the Biden-Harris Administration announced a “whole-of-government equity agenda.” As the primary source of health care coverage for over one in three people of color, Medicaid and CHIP have health equity at the heart of their missions. However, as noted above, significant disparities remain for people with Medicaid and CHIP. Advancing health equity depends on our ability to:

1. Measure disparities in health care access, quality, experience and outcomes,
2. Make evidence-based investments in equity-focused interventions, and
3. Close or reduce those gaps in health equity, including by making funding and new federal investments linked to progress on reducing health disparities.

First and foremost, we need accurate data. We can’t fix what we don’t know, and we can’t measure progress without a baseline. Reporting on race, ethnicity, language, disability status, and sexual orientation and gender identity are inconsistent at best—as are clear, consistent and comparable stratification of critical quality and outcome metrics across the program. CMS will work with states to improve measurement of health disparities across a core set of stratified metrics.

In addition, we recognize the best ideas and approaches for how to tackle health disparities will come from voices and stakeholders on the ground, not from CMS. We are committed to partnering with states so that health equity—and accountability for closing identified disparities in access, quality and outcomes—is at the forefront of every policy decision at the state level, and at the top of the priority list for every health care provider and health plan. That means working with states on evidenced-based interventions targeted at reducing health disparities that hold states and providers accountable to ensure continued progress on reducing gaps in health equity.

Some of this work is already in progress. For example, we are currently encouraging all states to implement the 12-month postpartum coverage option available under the American Rescue Plan. We will also take a whole-person view when investing in appropriate, targeted health equity interventions, and we will consider how to make investments in key populations with especially large disparities in health outcomes (e.g., for maternal/post-partum health, individuals involved in the justice system, individuals with housing instability). More broadly, we will apply this lens of health equity to many of the innovative discussions underway with states, including section 1115 demonstrations and other Medicaid funding approaches.

Focus Area 3: Innovation And Whole-Person Care

Finally, we will continue to encourage innovation in value-based care, delivery system reforms and whole-person care in Medicaid. Our approach includes partnering with states to ensure the health care system considers and supports the whole of a person’s needs: physical health, behavioral health, oral health, long-term service and supports, and health-related social needs. We must address longstanding gaps in areas such as behavioral health, as well as explore how Medicaid can contribute to addressing health-related social needs (e.g., nutrition and homelessness or housing instability).

Medicaid will also set a new goal of transitioning the vast majority of Medicaid beneficiaries into accountable care relationships by 2030. These efforts will be done in close partnership with the Center for Medicare and Medicaid Innovation, in alignment with our collective vision for value-based care, as well as with the Center for Medicare and the Medicare-Medicaid Coordination Office for making care more accessible for individuals dually eligible for Medicaid and Medicare. This focus area also overlaps with the CMS strategic pillar to drive innovation to tackle our health system challenges and promote value-based, person-centered care.

Establish Section 1115 Policy Principles And Criteria

Section 1115 of the Social Security Act authorizes the Secretary to approve experimental, pilot, or demonstration projects that are likely to promote the objectives of Medicaid and CHIP. Consistent with the priorities of the Biden-Harris Administration, we are working to develop a clear set of 1115 demonstration policy principles to ensure that federal Medicaid policies support equity and financial stewardship consistently across states. We believe that section 1115 demonstrations can help foster:

• Enhanced or expanded coverage for Medicaid beneficiaries and uninsured individuals;
• Improved access to care for Medicaid beneficiaries and uninsured individuals;
• Improved quality and equity and reduced health disparities;
• A strong, sustainable health safety net;
• Value-based care delivery and payment innovation that improves quality, equity, and whole-person care (including addressing health-related social needs), and
• Increased access to HCBS, substance use disorder services, and mental health services.

We are eager to engage with states on this topic, and encourage states to propose innovative section 1115 demonstrations that advance the objectives of the Medicaid and/or CHIP programs.

Bring Behavioral Health Care Up To Parity With Physical Health

Medicaid currently accounts for one-third of all spending on behavioral health. Still, behavioral health has seen a perennial underinvestment and is too often siloed from the rest of the medical system. Preliminary evidence suggests a sharp increase in the number of adults reporting adverse mental health conditions and substance-use disorders during the COVID-19 pandemic compared to what has been reported in prior years. When community-based care is unavailable, the quickest way to get behavioral health care is often through the emergency department (ED). During the pandemic, some hospitals are experiencing as much as a 300 percent increase in pediatric ED visits for behavioral health conditions, which only underscores the need to expand appropriate community-based behavior health care.

As our nation, and the people who rely on Medicaid and CHIP, come out of the pandemic, access to behavioral health care is key to closing the equity gap. We are committed to partnering with states finally to bring behavioral health services (both mental health and addiction treatment) up to parity with physical health services. This is an ongoing effort. For example, $15 million in Medicaid funding was recently awarded to states for community-based mobile crisis intervention services, and we are working towards guidance to all states on how to implement mobile crisis services. We are also partnering across the Department of Health and Human Services to strengthen our behavioral health safety net. Working in collaboration with states and with our partners at Substance Abuse and Mental Health Services Agency (SAMHSA), Centers for Disease Control and Prevention (CDC), the Administration for Children and Families (ACF), and others, we are committed to ensuring that evidenced-based, data-driven behavioral health policy and investments are implemented across our programs.

Future Of Medicaid And CHIP

More than 80 million people are enrolled in Medicaid and CHIP for their health care coverage. While these programs have done immeasurable good for hardworking families across our country, there is still so much more we can do. We have opportunities across all elements of our programs to protect and strengthen service delivery to our members. This work demands our attention and investment. CMS serves the public as a trusted partner and steward, dedicated to advancing health equity, expanding coverage, and improving health outcomes. Through our focus on coverage and access, equity, and innovation, we are committed to executing on this vision.

We look forward to the exciting road ahead towards stronger, better Medicaid and CHIP programs.