The figures suggest individuals are losing health coverage for failure to fill out paperwork, not necessarily because they’re no longer eligible. Just 1% of those who lost coverage, in fact, were processed and determined to be ineligible.

“These are people who have not navigated the health insurance world since before the pandemic or even longer,” Rivera said in an interview. “We know a lot of people are going to slip through the cracks and just end up without insurance.”

The abrupt changes come as New Mexico and other states begin reexamining who’s eligible to continue participating in Medicaid. Throughout much of the pandemic, the federal government provided extra funding to states while directing them not to kick anyone off Medicaid, even if the person’s eligibility had changed.

But the federal freeze ended in April. New Mexico is now reexamining its Medicaid rolls — processing more than 100,000 people a month — to determine who remains eligible.

In the first two months, about 37% of the individuals due for review were renewed and maintained coverage, and another 28% lost coverage, according to HSD data. The remainder are people whose applications are still being processed, which allows them to maintain coverage in the meantime.

Applications processed ‘as quickly as possible’

For one Albuquerque woman, her efforts to regain Medicaid date to March 3 when she hand-delivered her application to an HSD office on Bridge SW.

Since then, she has submitted multiple applications and related documents to HSD in what, so far, has been a futile attempt to restart her Medicaid enrollment, which ended May 31.

The 64-year-old woman, who declined to let the Journal publish her name saying she feared retribution, received a letter from HSD dated April 28 that said: “There is a delay in processing your March 3, 2023, application. We have not finished looking at your application and documents. We are working to determine if you get benefits.”

She later submitted an online application with the help of an insurance professional. Within the past week, she received a letter dated June 14 from HSD that contained language identical to the April 28 letter. It said HSD staff “have not finished looking at your application and documents” and were still processing her application.

Tim Fowler, a spokesman for the Human Services Department, said the agency is renewing as many people as it can through administrative action, even without input from the Medicaid participant.

Some renewals, for example, can be processed based on data already available to the department.

But it’s important, Fowler said, for anyone who receives a renewal notice — watch for a turquoise envelope — to complete the application.

“HSD’s customers are our highest priority,” Fowler said in a written statement, “and we are processing renewals as quickly as possible. Any individual who has submitted a renewal maintains their coverage until their application is fully processed.”

It’s not clear whether the pace of people losing coverage will continue. The state has 12 months to carry out the eligibility review, and Fowler said the losses so far are in line with expectations.

Influx of applications

A New Mexico insurance broker said HSD doesn’t have enough personnel to process the huge volume of Medicaid applications, leaving some people without coverage.

But some of her clients submitted applications in February, she said, and are still waiting for approval, even after reapplying without getting a response.

“I’m not at all criticizing the HSD workers,” Sands said. “I don’t think they’re being given the support that they need in order to handle the influx that they’ve been hit with.”

People with serious illnesses are losing access to medical care because of the backlog, Sands contends. Legally, Medicaid will reimburse patients for medical bills dating back 90 days if they made out-of-pocket payments, but few Medicaid-eligible patients can afford to pay their bills.

“While you’re waiting for your application, they say that you can pay bills out of your pocket, and then you can get reimbursed,” Sands said. “But most people can’t afford that sort of thing out of pocket. And if they could, they certainly wouldn’t be applying for Medicaid.”

The bottleneck appears most severe in southern New Mexico, particularly Doña Ana County, she said.

Sovereign Hager, legal director of the New Mexico Center on Law and Poverty, said her organization is getting lots of calls from people concerned about their benefits.

“We clearly need to have better resources for processing these applications,” Hager said.

She encourages people to renew their Medicaid applications even if their income has gone up. In some cases, she said, the children in a household might be eligible for coverage even if an adult isn’t.

And for people who don’t qualify for Medicaid, Hager said, they may be eligible for help through the state health insurance exchange.

Fowler, the Human Services Department spokesman, said the agency is doing what it can to handle the surge in paperwork.

The state “is bringing on temporary contract staff whose sole task is to process Medicaid applications and renewals,” he said. “We are also taking advantage of every federal flexibility afforded to HSD to reduce administrative burden so we can process renewals more efficiently.”

Medicaid a vital part of NM health care

The Medicaid unwinding could have enormous consequences in New Mexico this year, Rivera said, including increased risk of medical debt for families and more uncompensated care for hospitals.

“We know that on an individual level, not having insurance means risk of medical debt, delayed care, skipped medications and ultimately poor health outcomes,” Rivera of Health Action New Mexico said. “One major health episode can mean debilitating debt for a family.”

Medicaid is a critical part of New Mexico’s health care landscape. About 967,000 people — 46% of the population — were enrolled in Medicaid last month, according to HSD data.

In 2021, about 54% of the births in New Mexico were covered by Medicaid, the third-highest share in the nation, according to KFF, a nonpartisan health research organization based in San Francisco.

Medicaid is a joint federal-state program that provides health care for lower-income residents. Eligibility and benefits vary based on a complex set of factors including income and family size.

The Medicaid purge is a consequence of federal legislation. An appropriations package signed in December last year ended the continuous enrollment provision March 31.

The Associated Press reported this month that about 1.5 million people have been removed from Medicaid in two dozen states that started the process in April or May.