Biden's health care wins are being undone — and at the worst possible time

The U.S. is dismantling one of the last major pillars of its Covid-era safety net.

For President Joe Biden, the timing couldn’t be worse.

States across the country, both blue and red, are purging their Medicaid programs of millions of low-income enrollees for the first time in three years, after a pandemic policy meant to prevent vulnerable people from suddenly losing health coverage expired earlier this spring.

Nearly 4 million Americans have been cut from Medicaid in the last three months, most of whom lost their insurance over paperwork issues. The number is projected to balloon to 15 million by this time next year, according to official estimates, though some now fear the final toll will be even bigger.

The mass terminations, which together represent the biggest reshuffling of the health insurance landscape since Obamacare, come as Covid cases rise again and Biden embarks on a reelection campaign built around convincing working-class voters they're better off than before.

The impact is likely to reverse meaningful progress on health coverage and poverty that the White House once trumpeted as a direct benefit of its policies. And with Biden already facing entrenched skepticism over the state of the economy, allies increasingly worry the drumbeat of coverage losses will undercut his core message that “Bidenomics” is driving the biggest gains for those who have the least.

“This is a huge challenge and an unprecedented situation,” said Joan Alker, executive director of Georgetown University's Center for Children and Families. “It’s both unlucky and an unfortunate risk for the Biden administration that we’re going to see the uninsured rate go up as a consequence.”

Congress ordered states in early 2020 to halt requirements that Medicaid enrollees renew their coverage each year, ensuring poor Americans would remain continuously insured throughout the Covid crisis. The Medicaid population swelled to a record 93 million as a result — with 1 in 4 Americans insured by the program.

But when Congress ended that protection in April ahead of the expiration of the Covid public health emergency, states began combing their Medicaid rolls in search of those who no longer qualified because they make too much money or another factor, like pregnancy or parenting status, has changed. Florida kicked more than 400,000 people out of Medicaid in its first three months. Texas dropped over half-a-million people in a single month, with the vast majority cut off for failing to submit the required paperwork, rather than an official determination they were ineligible.

And in Arkansas, where GOP Gov. Sarah Huckabee Sanders' administration is taking six months to complete its eligibility review, more than 300,000 have lost coverage — including more than 108,000 children.

“It’s so much worse than I thought,” said Trevor Hawkins, an attorney with Legal Aid of Arkansas. “The system is just so flawed that it’s causing way too many people to lose coverage that it shouldn’t be. I did not think that they would consistently across three months terminate 60,000-plus people. That number is — I just can’t wrap my mind around it.”

Arkansas health officials have said they are working to comply with normal eligibility rules set by Congress and the administration.

“This is exactly how the system is supposed to work: we are ensuring that benefits remain available for Arkansans who truly need them, and we are also working to make sure those who no longer qualify know about available options for health care coverage,” said Kristi Putnam, Arkansas’ Department of Human Services secretary.

Inside the Biden administration, officials say they've made it a top priority to pressure states to correct errors and minimize coverage losses. They downplay the political peril, insisting that the behind-the-scenes work is having substantial impact across the country.

"This is not a negotiation with states about, 'Hey, we think maybe, because you inappropriately terminated these people, you should fix it,'" said a senior administration official, who was granted anonymity to characterize private conversations. "It's like, you have to fix it."

White House aides are also focused on finding ways to reconnect people with coverage either by re-enrolling in Medicaid or signing up for Obamacare, holding regular meetings with health department officials to plan outreach strategies, another person familiar with the matter said.

But the administration has refused to publicly criticize individual states or even identify which ones it believes face the most serious issues, for fear of damaging its relationships with them. Though GOP-led states like Texas and Arkansas rank among the most aggressive in cutting people from Medicaid, states with Democratic governors such as Kansas and Kentucky are also dropping enrollees at high rates.

On Capitol Hill, senior Democrats have grown increasingly frustrated with the administration’s approach, questioning its effectiveness and pushing for more aggressive steps — such as cutting off critical funding streams to states that refuse to slow their disenrollments. Sen. Ron Wyden (D-Ore.), who chairs the committee that oversees Medicaid, likened some states' attempts to stop people from losing coverage to "waving at somebody as their car goes by, and going, well, we contacted you."

Several other Democrats, alarmed by the accelerating pace of disenrollments, have privately complained to senior aides across the White House, two people familiar with the conversations said. They've questioned the preparedness of the health department's Centers for Medicare and Medicaid Services to manage the disenrollment process and urged the White House's Domestic Policy Council to take a more active role in pushing back on states.

"Everybody's got to be more forceful," said Wyden, who has pressed top Biden health officials for answers. "This is morally repugnant what's being done to these poor people."

Congress actually envisioned such a scenario. Last year, lawmakers expanded the administration's power to rein in states, in anticipation it might need to exercise stronger oversight of the Medicaid process. But with states like Arkansas and Idaho already nearing the end of the hardest part of their eligibility checks, that window to act is closing.

"The longer you wait, the less effective it becomes," Hawkins said. "There's diminishing returns."

Sara Lonardo, senior adviser and press secretary at CMS, said the agency is taking its monitoring and oversight role “incredibly seriously” and will continue to act to prevent eligible people from losing coverage. That can include requiring states to pause terminations, reinstate coverage, adopt strategies to help people through the renewal process and address systems issues.

“If states don’t, they will risk losing the enhanced federal funding,” Lonardo said. “Some states are coming forward proactively to CMS to acknowledge and fix renewal issues.”

The agency has worked with 14 states to pause terminations for some or all Medicaid recipients over compliance issues, though it did not identify which ones.

Some Biden allies dismissed political concerns tied to the disenrollments, pointing to Democrats' clear advantage on health issues in the polls. Biden's expansion of Obamacare subsidies also means more people who lose Medicaid this year may be able to afford new insurance.

"Coverage is at an all-time high and the number of people uninsured is at an all-time low, and a lot of that is because of the work of Joe Biden," said Leslie Dach, chair of the Democrat-aligned group Protect Our Care, arguing that red state leaders will shoulder any blame tied to coverage losses. "These numbers are being driven by governors that have shown themselves time and time again to be opposed to health care."

Yet, for a White House still trying to get the public to buy into Bidenomics, the coverage losses could further fuel voters' skepticism that the government is helping them through difficult economic times.

Jamila Michener, co-director of the Cornell Center for Health Equity who has studied Medicaid's impact on elections, warned that losing Medicaid coverage correlated in the past with suppressed voter turnout. And while most of the states experiencing the highest rates of coverage loss so far are states Biden lost decidedly in 2020, swing states like Georgia and Nevada have among the top 10 highest disenrollment rates.

“In places where the unwinding has been associated with disenrollment and with the negative experiences with Medicaid, we are more likely to see that translated into negative electoral consequences,” Michener said. "When unwinding unfolds in ways that alienate Medicaid beneficiaries from politics or the electoral system, that has implications for political inequality, both in terms of class and in terms of race.”