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Editor's note: This is the first in a two-part series examining a drop in Arkansas' Medicaid enrollment numbers. Part two will appear in Sunday's edition.

Last September, a few months after she was diagnosed with multiple sclerosis, Kyla Brakebill’s insurance coverage was canceled by the Arkansas Department of Human Services. Almost a year later, she remains uninsured.

Brakebill, 43, first began having headaches and dizzy spells in November 2016. After an especially intense episode, she was taken to the emergency room at Baptist Health Medical Center in North Little Rock, where a doctor ordered an MRI. Brakebill said in an interview she was told the scan showed “that my brain was like the brain of a 64-year-old woman.”

Frightening as the news was, Brakebill thought she at least wouldn’t have to worry about paying for medical care: She was on Arkansas Works, the state’s Medicaid-funded insurance program for low-income adults established under the Affordable Care Act, or Obamacare. (Arkansas Works is also sometimes called “Medicaid expansion” or “the private option.”) Like most on the program, her policy was provided through a private carrier, Arkansas Blue Cross and Blue Shield. “It covered everything, and that was great,” Brakebill said. The hospital helped her find a primary care doctor, who gave her a probable MS diagnosis and sent her to a neurologist, who in turn scheduled Brakebill for another round of brain scans.

Brakebill never had the scans performed. Late last summer, while taking out the trash at her house, she lost her balance and fell, breaking her toe and knocking out a tooth. A dentist prescribed antibiotics to stave off an infection, and shortly thereafter, Brakebill attempted to fill it.

“I was in Memphis for work and my mouth was hurt really bad,” she said. “I get to Walgreens and I find out they won’t fill my prescription because my insurance had ended.” Baffled, she called Blue Cross and DHS as soon as she returned home. “After a million phone calls and finally getting to talk to someone, they said it was because I didn’t send a change of address.”

Brakebill had recently lost her home to a foreclosure and had moved several times. However, she had filled out a change of address form at the post office and had her mail forwarded to a P.O. box. She had no idea, she said, that DHS required beneficiaries to directly notify the agency of any physical address change.

DHS requires beneficiaries to notify it of any address change within 10 days of a move, agency spokeswoman Amy Webb said. If mail sent to a beneficiary is returned to DHS and the agency hasn’t received notification of an address change, it will close that person’s case.

Enrollment numbers

Over the past 18 months, Arkansas Works enrollment decreased by almost 60,000 people, DHS numbers show. Enrollment peaked near 330,000 sometime in January 2017. By July 1 of this year, it had fallen to 271,000 — a 15 percent drop.

The state is shedding beneficiaries at a faster rate than any other state that chose to expand Medicaid, according to data from the federal Centers for Medicare and Medicaid Services. Arkansas saw a 6 percent decline in its overall Medicaid enrollment between January 2017 and May 2018. The shrinking Arkansas Works program evidently accounted for most of the drop. (The CMS data combine the expansion population and the larger, more expensive “traditional” Medicaid population, which includes children on ARKids, elderly people, disabled people and other groups.) Only three non-expansion states — Texas, Idaho and Tennessee — saw a larger percentage decrease in Medicaid overall.

Arkansas has lately come under national scrutiny for its new work requirement for some Arkansas Works enrollees, with many health researchers and advocates warning the policy could lead to thousands losing coverage. Yet little attention has been paid to the steady monthly reduction in Medicaid enrollment figures predating the work requirement, which began in June. The work rule won’t trigger terminations of coverage until September at the earliest. That means the almost 60,000 people pared from Arkansas Works over the last year and a half dropped away for other reasons.

Gov. Asa Hutchinson has given two explanations. The first is a strong economy. Because Medicaid expansion is open only to those whose incomes fall below 138 percent of the federal poverty line (in 2018, that’s $16,753 for an individual or $34,638 for a family of four), getting a better job often makes a beneficiary ineligible for Arkansas Works. He or she might then gain insurance through an employer — or, if that’s not an option, purchase a plan on the individual marketplace with the help of a federal subsidy.

“I would emphasize that this is not a change in services,” Hutchinson said at a recent session with the press at which he touted savings in the Medicaid budget. “This is simply the result of people that are working. … If they got a better job … and they no longer qualify, that’s a good thing.”

Jennifer Wagner, a senior policy analyst at the Center for Budget and Policy Priorities, a liberal-leaning think tank in Washington, D.C., said the picture was more complicated.

“I’m sure some portion is attributable to the improving economy,” Wagner said. “The thing that we tend to see, though, is that even when people are able to find employment, often their income does not go up high enough to make them no longer eligible. And often the low-wage work they get does not include health insurance.”

The fact that Arkansas’s 18-month decline in Medicaid enrollment outpaced most other states also suggests there’s more at play than economic factors. Arkansas’s unemployment rate is low, but so are those of other states that haven’t seen a similarly steep dip in Medicaid rolls.

The governor’s second explanation for the reduced enrollment is an improved effort at DHS to “scrub” the Medicaid rolls by removing people who are no longer eligible. That includes many situations: individuals who are making too much money, who have moved out of state, who are incarcerated, who have turned 65 (and are therefore receiving Medicare) or who are dead. But it also includes many people such as Kyla Brakebill, who lost coverage because of a problem communicating with DHS.

In July, DHS released a graph breaking down the reasons behind the approximately 14,000 Arkansas Works case closures the previous month. Only 11 percent of the cases closed in June were attributed to an increase in household income. (However, Wagner said that figure is likely an understatement, since many beneficiaries who no longer need Arkansas Works may simply drop off the program.) Sixty percent of cases closed in June were terminated for one of two reasons: “failed to return requested information” or “unable to locate client or moved out-of-state.”

The latter category includes cases in which DHS receives any piece of returned mail, DHS spokeswoman Webb said in an email. Webb said the agency couldn’t distinguish between clients who moved out of state and those who moved within the state.

Wagner, who studies Medicaid policy across the country, said the DHS approach to returned mail was “a very aggressive stance for the state to take.”

It’s not uncommon, she said, for Medicaid recipients in all states to lose coverage at “recertification,” the annual update of personal information mandated for every beneficiary. “People are often sent a letter and are required to send that back. They may also be required to send additional verification, like pay stubs,” Wagner said. “No matter what, there’s going to be some degree of fall-off at recertification.”

In Arkansas, though, any returned mail — not just at recertification — automatically triggers a closure. That creates more opportunities for a beneficiary to lose coverage. Mary Franklin, director of DHS’ Division of County Operations, wrote in an email that “if the information is not returned by the deadline, the case is closed. Many of these closures are automated, and there is an extra 5 days built in to our automated process to make sure that any information that is received has been logged into the system.”

Wagner said, “I don’t know that other states would necessarily take action to close a case just because of returned mail. That’s concerning, especially because this population often moves a lot … staying with friends or family or things like that. So that’s kind of a lot to expect — for it to be constantly updated.” The state could take more proactive steps to find a beneficiary, Wagner added, such as cross-checking with the postal service’s National Change of Address system. Franklin said DHS does not check that database before closing a case.

Clearing up confusion

Many Arkansas Works beneficiaries who lose coverage quickly regain it. Brakebill did not, seemingly due to a combination of bad timing and bad information.

She said she thought she had to wait until November to reapply for coverage. That’s likely because of widespread public confusion about the difference between Arkansas Works (which can be applied for at any point during the year) and the individual insurance marketplace (which can typically only be accessed during a brief open enrollment period at the end of the year). People whose income is above 138 percent of poverty can get coverage on the marketplace subsidized by the federal government.

It’s not clear which group Brakebill should have been in at that point in time, because her income fluctuated significantly from month to month. (In January 2017, she started working as a marketing manager for a home improvement company that sets up booths at public events. She earns a few hundred dollars each week in base pay and — depending on the season — an additional amount in commissions.) It may be that Brakebill could have simply re-enrolled in Arkansas Works last fall. It’s also possible her annual income had exceeded the threshold for a single-person household, in which case she should have transitioned onto the marketplace. Assuming this was so, however, she shouldn’t have had to wait for open enrollment: The individual marketplace allows for a 60-day “special enrollment” period after a person loses coverage from a different source.

When Brakebill finally went online to buy insurance at the end of the year, she said, she hit another snag: The marketplace website asked her for employer information she didn’t have. That was right before open enrollment ended on Dec. 15. In 2018, based on the income information she provided a reporter, it appears Brakebill makes slightly too much to qualify for Arkansas Works — but she can’t sign up for insurance on the marketplace until 2018 open enrollment begins again this November.

In the meantime, she’s in limbo. “Just to know that I can’t go in and see a doctor — it worries me,” Brakebill said. Her multiple sclerosis symptoms come and go, but on bad days she finds it hard to function. “Like this week, my MS is pretty bad. Yesterday, I did everything backwards. Like my job, everything. … So if I’m talking in circles, that’s what’s wrong with me. Sometimes I have a really great conversation, and sometimes I can’t even speak.”

In addition to MS, she suffers from high blood pressure and polycystic ovary syndrome, a hormonal disorder that causes weight gain and facial hair growth and has been linked to diabetes. Both conditions are controllable with drugs, but she does not have prescriptions for either. She’d like to find a better job, she said, but she feels constrained by her medical problems.

“I’m in my 40s, but I can’t have a breast exam or a colonoscopy or anything like that. I can’t go for my yearly pap smear,” she said. “Until I get the insurance to do all that again, I guess I’ll just try to live until I don’t live anymore.”

Hutchinson has pushed back against the idea that DHS’ rules may be stricter than necessary.

“That’s called responsible management,” he said. “I don’t think very many in Arkansas would want our taxpayer dollars paying for insurance for those that may be living out of state, may have moved, may have income that exceeds the limits.” Medicaid expenditures remained flat in the fiscal year that ended in June, he noted — a rare achievement for a state budget. According to DHS figures, that was mostly due to declining enrollment.

This reporting is made possible in part by a yearlong fellowship sponsored by the Association of Health Care Journalists and supported by The Commonwealth Fund. It is published here courtesy of the Arkansas Nonprofit News Network, an independent, nonpartisan project dedicated to producing journalism that matters to Arkansans. Find out more at arknews.org.