Senators’ Bill Would Protect Americans from Losing Coverage after Short-term Pay Increases Caused by Taking on Extra Shift or Working Overtime
WASHINGTON, D.C. – March 12, 2021 – Today, U.S. Sens. Sherrod Brown (D-OH), Tammy Baldwin (D-WI), Elizabeth Warren (D-MA) and Sheldon Whitehouse (D-RI) reintroduced legislation to provide stability for individuals eligible for Medicaid or the Children’s Health Insurance Program (CHIP) by ensuring they can depend on their coverage for a continuous 12-month period. The senators’ bill, the Stabilize Medicaid and CHIP Coverage Act, would protect Americans from losing their coverage as a result of short-term changes to their incomes. The bill also provides incentives to states to help reduce turnover across Medicaid and CHIP programs. Reps. Debbie Dingell (D-MI-12) and John Katko (R-NY-24) are leading the bipartisan, counterpart legislation in the House.
Each year, millions of Medicaid and CHIP beneficiaries who enroll in coverage are at risk of losing that coverage as a result of taking on an extra shift or working overtime, simply because their income fluctuates slightly. As a result, these short-term changes set in motion bureaucratic snafus that cause taxpayers to be disenrolled from their insurance. This causes people to “churn” in and out of coverage. Churning in and out of health coverage has a direct, negative effect on beneficiaries as well as the ability of doctors, hospitals, and health plans to provide effective, continuous care. Not only does this breakdown in coverage disrupt care, it can also cause significant administrative challenges that result in higher costs for states, providers, and health plans.
The COVID-19 pandemic has exacerbated this challenge for states and individuals who rely on Medicaid or CHIP coverage for their health insurance. And as folks’ employment status has changed as a result of the pandemic – whether it be from losing a job, having hours cut, getting furloughed, or taking on a new job – the resulting income shifts have caused substantial churn for individuals. The Stabilize Medicaid and CHIP Coverage Act would ease that burden by ensuring beneficiaries can depend on their coverage for a continuous 12-month period, which has become increasingly important as the nation recovers from the COVID-19 pandemic, and would prevent multiple changes in coverage, reduce care disruptions and minimize logistical challenges for individuals, states, and health plans.
“No Ohioan’s treatment plan or care should be disrupted because they lost coverage as a result of taking on an extra shift or working overtime to make ends meet, especially during a pandemic. This critical legislation will modernize the Medicaid program to ensure kids and families retain their coverage even if their income fluctuates slightly from month-to-month, something many have experienced during this economic uncertainty,” said Senator Brown.
“We have not beaten COVID-19 and people are still struggling in Wisconsin and across this country. The last thing we need is for families and kids to suddenly lose their health care coverage as we are working to get past this pandemic,” said Senator Baldwin. “We should be helping working families and their children maintain access to the quality health care coverage they depend on through Medicaid and the CHIP program. This legislation would do just that.”
“Health care is a basic human right, and at no point has it been more true to fight for these human rights than during the coronavirus pandemic,” Senator Warren said. “I am glad to reintroduce the Stabilize Medicaid and CHIP Coverage Act to ensure that all families have access to quality healthcare coverage.”
“A short-term change in income from an extra shift at work or some overtime can put health coverage at risk for Medicaid and CHIP beneficiaries,” said Senator Whitehouse. “This bill will help Americans benefiting from these programs avoid losing their coverage due to small bumps in pay and needless bureaucratic hurdles.”
The Stabilize Medicaid and CHIP Coverage Act has been endorsed by a number of organizations, including America’s Essential Hospitals, the Association for Community Affiliated Plans, the Children’s Hospital Association, and Families USA.
“We applaud the leadership of Senator Brown, Senator Baldwin, Senator Warren and Senator Whitehouse in reintroducing this bill,” said Margaret A. Murray, CEO of the Association for Community Affiliated Plans. “As America emerges from the shadow of the pandemic, the Stabilize Medicaid and CHIP Coverage Act would ensure ongoing stability for families still feeling the impact of lost jobs and diminished wages, and it would keep families and children with low incomes from losing coverage through hiccups in the bureaucracy. We’re grateful for the leadership these Senators have shown not just today but throughout our shared trajectory of recovery, and call upon their fellow members of the Senate to join them.”