More than eight months after passage of HR 1, the “One Big Beautiful Bill Act,” the Centers for Medicare & Medicaid Services has provided formal guidance to the states on how to redetermine Medicaid eligibility for certain Medicaid beneficiaries – a major part of the bill’s health care changes.
Under that law, states must redetermine affected individuals’ continued Medicaid eligibility every six months beginning with renewals scheduled on or after January 1, 2027.
CMS is giving states two options for redetermining Medicaid eligibility. They may:
- move an individual’s previously set 2027 renewal date to an earlier date in 2027 to space out renewals in the adult expansion group throughout the year; or
- use the individual’s previously set 2027 renewal date to redetermine their eligibility.
Nothing in HR 1 changes states’ processing of Medicaid eligibility renewal applications. States must complete the renewal process by the end of the beneficiary’s eligibility period and can start up to 90 days in advance of the renewal date.
In its guidance, CMS directs states to rely first on ex parte information to complete an individual’s renewal automatically – that is, information sources available to the state such as Social Security Administration data. If the state cannot complete its review in this manner, they are to send a prepopulated renewal form to the applicant and request the information needed. Individuals deemed no longer eligible for Medicaid coverage must receive advance notice with their fair hearing rights at least 10 days prior to termination.
The Congressional Budget Office projects that 11.8 million people will lose their Medicaid benefits by 2034 because of the policy changes in HR 1.
CMS will be issuing separate guidance by June 1 on HR 1’s community engagement (work) requirements.
The ultimate effectiveness of this process is of great importance to community safety-net hospitals, including members of the Alliance of Safety-Net Hospitals. These providers care for more low-income patients than the typical American hospitals and already expect to find themselves treating more uninsured patients, including those who have lost their Medicaid benefits. For these hospitals, it is critical that this new process captures every eligible Medicaid beneficiary possible.
Learn more from CMS’s letter to state Medicaid directors and from the Modern Healthcare article “Medicaid work requirements leave states scrambling for 2027” (subscription required).
