New Medicaid Rules Require Proof of Citizenship

Buried in the Deficit Reduction Act of 2005 is a provision that requires all individuals who apply for Medicaid to prove they are citizens by showing passports or birth certificates, and in certain circumstances, a limited number of other documents.  This requirement, which becomes effective on July 1, 2006, will affect four million residents. 

Until now, federal health officials gave states broad discretion in validating citizenship.  Most applicants simply filled out an affidavit attesting to citizenship since this was the easiest way to satisfy the requirement.  In a letter sent to state officials, the Bush administration said “Self attestation of citizenship and identity is no longer an acceptable practice”.  Furthermore, when individuals go through their annual Medicaid recertification process, they will be required to produce this documentation.  In New York State, this will affect all four million residents on Medicaid.

The need to obtain a birth certificate or passport would impose a new, out-of-pocket cost on the Medicaid application process and delay potential enrollees’ ability to complete their application.  These costs and time delays may deter potential enrollees from entering the program and cause them to remain uninsured. New York residents, for example, must pay $30.00 and wait up to four weeks if they apply for a birth certificate through regular mail.  However, if a potential Medicaid enrollee needs to complete the Medicaid application process as soon as possible, he or she must pay $45 for an expedited birth certificate.  Alternatively, a new passport costs $82 for children under age 16 and $97 for everyone else.  These costs would certainly cause financial difficulties for low-income individuals and families and could prevent or delay an individual from getting needed health care.  

In fact, in a recent report the Department of Health and Human Services’ Office of Inspector General (OIG) found no substantial evidence that immigrants unlawfully obtain Medicaid by falsely claiming citizenship. According to the OIG, 47 states allow self-declaration of citizenship for Medicaid and 44 states require further documentation when there is reason to question an applicant’s status. In fact, state Medicaid administrators reported that they had not seen a problem with self-declaration of citizenship from their quality control review systems. Therefore, this provision would create little to no savings from eliminating ineligible immigrants who have falsely claimed citizenship status to obtain Medicaid coverage

So how does the Congressional Budget Office estimate that the provision will save $220 million in Medicaid costs over five years?  The answer is rather simple; these savings will come from reducing or delaying Medicaid enrollment for individuals who are U.S. citizens and would otherwise be immediately eligible for benefits. 

In addition, this provision would actually increase Medicaid administrative costs. States are already burdened by the amount of paperwork and documentation needed to enroll an individual in Medicaid, and the new requirements dramatically increase the amount of time states must spend verifying information on each application and eligibility renewal, but it also increases the likelihood that state eligibility workers will need to scrutinize repeat applications – for example, individuals who are denied coverage because they fail to provide documentation may later reapply.

If there’s any good news here it is that citizenship only needs to be recertified once during the annual recertification process and not annually.  Existing Medicaid recipients will no doubt be surprised by this new cost when they reapply for benefits.  No doubt that in some cases, individuals who have coverage may become uninsured if they cannot manage to comply with this requirement.