HIPAA Special Enrollment Requests to Increase Due to Loss of Medicaid Eligibility

Beginning April 1, 2023, states that maintained continuous Medicaid enrollment during the COVID-19 pandemic may start terminating coverage for individuals who are no longer eligible. Employers will likely see an increase in midyear enrollment requests as individuals lose eligibility for Medicaid coverage.

Medicaid Continuous Enrollment

To receive additional federal funding, many states maintained continuous enrollment for individuals enrolled in Medicaid during the COVID-19 pandemic, despite any changes in eligibility status. Medicaid’s continuous enrollment requirement ends on March 31, 2023. While some individuals who lose Medicaid eligibility will enroll in subsidized coverage through an Exchange, federal regulators estimate that 5 million people will seek coverage under employer-sponsored health plans.

HIPAA Special Enrollment

The Health Insurance Portability and Accountability Act (HIPAA) requires group health plans to provide special enrollment opportunities in certain situations, including when employees or their dependents lose eligibility for Medicaid coverage. Employees normally have 60 days to request special enrollment, but this deadline is extended during the COVID-19 outbreak period, which is scheduled to end on July 10, 2023.

Action Steps

Employers should allow employees (and dependents) who lose Medicaid eligibility to enroll in their group health coverage as special enrollees, assuming they are eligible under the terms of the plan and timely request enrollment. Employers should note that HIPAA’s 60-day deadline for requesting special enrollment is extended during the COVID-19 outbreak period.

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