1. Funded by a grant from the RobertWood Johnson Foundation
How will health reform affect churning in
states?
Brett Fried, MS
State Health Research and Policy
Interest Group Meeting (SHRP)
June 22, 2013

2. Acknowledgements
• Supported by a grant from the Robert Wood
Johnson Foundation to the State Health
Access Data Assistance Center (SHADAC)
at the University of Minnesota
• Co-Author
– Julie Sonier, SHADAC
2

3. Overview
• Background on Churn
• Methods
• Results
• Discussion
• Implications
• Future Research
3

4. Churn: Background
What is it?
Churning in this presentation is the percent of
individuals who are income-eligible for Medicaid at a
point in time, but no longer eligible 12 months later
Why does it matter?
– Can disrupt continuity of care
– Can increase administrative costs for plans,
providers and government entities
– Knowledge about the degree of churn can help
states, providers and plans reduce the costs and
impacts of churning
4

5. Churning for Medicaid Enrollees
Eligibility changes due to:
• Changes in income
• Changes in family size
What happens to people who lose Medicaid
eligibility?
• Uninsured
• ESI or Direct Purchase
• Post ACA Implementation: Subsidies in the
Exchange
5

6. Data Source – The SIPP
• The Survey of Income and Program Participation (SIPP) is a
Census Bureau panel survey that is done in four month waves with
each wave split into four groups (rotations) and asked to recall
information over four months (reference months)
• The purpose of the SIPP is to provide information on income and
government program participation
• Here we are using reference month April 2010 from wave 6 and
April 2011 from wave 9 of the 2008 panel which includes about
90,000 observations
• Not designed to be state representative
6

7. Analytic Approach
• Sample was limited to people who were present in both
waves of the survey
• Adjusted for attrition using a simple logistic regression
• The focus of this research is change in Medicaid
eligibility after 12 months as a result of changes in
income volatility and family size
• State Medicaid eligibility for jobless parents of dependent
children and jobless other adults is from Kaiser (2013)
survey of Medicaid eligibility
• National data but tested weighting to states
7

8. RESULTS
8

9. Income Distribution by Eligibility Group
22% 22%
26% 26%
20% 19%
41% 42%
44% 44%
40% 41%
36% 37%
30% 31%
40% 40%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2010 2011 2010 2011 2010 2011
0-138% FPG 139-400% FPG 401%+ FPG
9
Nonelderly Adults Parents Childless Adults

10. Starting at 0-138% FPG: Where are they
after 12 months?
68%
73%
64%
27%
24%
29%
5%
3%
7%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Nonelderly Adults Parents Childless Adults
0-138% FPG
139-400% FPG
401%+ FPG
10

11. Starting at 139-400% FPG: Where are they
after 12 months?
13% 14% 13%
72% 73% 71%
15% 13%
16%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Nonelderly Adults Parents Childless Adults
0-138% FPG
139-400% FPG
401%+ FPG
11

12. Starting at 401%+ FPG: Where are they
after 12 months?
3% 3% 3%
16% 16% 16%
81% 81% 81%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Nonelderly Adults Parents Childless Adults
0-138% FPG
139-400% FPG
401%+ FPG
12

13. As the Medicaid Eligibility Threshold increases,
“churn” decreases for parents and childless adults
62%
60%
57%
55%
52%
50%
45%
42%
38%
36%
33% 32%
29%
27%
57% 56% 55% 54% 53% 52%
49%
47%
45%
43%
41%
39%
37% 36%
0%
10%
20%
30%
40%
50%
60%
70%
10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 110% 120% 130% 138%
Percentchurnafter12months
Medicaid EligibilityThreshold
Parents
Childless Adults
13

14. Percent of parents who are income eligible for
Medicaid but are ineligible after 12 months
14

15. Reduction in “churn” as a result of change from
state to ACA Medicaid eligibility threshold: Parents
15

16. Discussion
Other reasons why people “churn” into or out of Medicaid:
• Changes in family status
• Changes in assets
• Changes to program administration
• Change in awareness or ability to renew coverage
The ACA will reduce some of this churn because of the
following:
• Streamlined application process
• Requiring the use of existing state information
• Increased awareness of renewal process
16

17. Implications
For every increase in the Medicaid eligibility threshold by 10
percentage points, “churn” decreases on average by 3
percentage points for parents and on average by about 1.5
percentage points for childless adults.
Consequently, states that have a current eligibility threshold
for parents and/or childless adults that is less than 138% of
poverty should see a decrease in churn (as defined here) if
they choose the ACA Medicaid expansion.
17

18. Future Research
• Estimate the characteristics of people that churn
at the state level
• Estimate churning over different time periods
• Estimate churning into and out of subsidies in
the exchange.
18

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@shadac
Brett Fried
Senior Research Fellow
612-624-1406
bfried@umn.edu