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State Works to Eliminate Backlog of Thousands of Medicaid Applications

Remaining 9,000 to 12,000 applications stuck in county offices will be farmed out to private contractor

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By most accounts, the state’s Medicaid expansion has been a success -- but not for the 9,000 to 12,000 residents still waiting for their applications to be processed.

The botched rollout of a new Department of Human Services computer system and a fragmented, county-focused Medicaid application system have been blamed for the backlog.

But now the state agency is aiming to end the logjam over the next six weeks by shifting the remaining backlog from county welfare offices to the Xerox company, which has a contract to serve as the state’s Medicaid health benefits coordinator.

“We’re doing what we can to support the counties and get them through the redeterminations,” said Valerie Harr, director of the Division of Medical Assistance and Health Services, who oversees Medicaid for the state.

A redetermination is a periodic check of an enrollee’s income that must be done to ensure the person is still eligible for Medicaid.

While the state received federal permission to delay those redeterminations while it handled the surge of new applications last year, they must be done this year. By shifting the remaining backlog of new applicants to Xerox, the state is aiming to have the county offices focus on redeterminations, Harr said.

The backlog is far below its peak of 55,000 in May 2014, but it’s been flat since the state reported a backlog of 11,000 late last year.

People can still get healthcare at hospitals and federally qualified health centers while their Medicaid application is processed.

Harr said the state will begin shifting the remaining unprocessed applications from the counties to Xerox this week, possibly having the backlog cleared by the end of May.

One county with a persistent backlog – Essex – has already had applications handed over to Xerox, Harr said.

The state has added 420,000 residents to NJ FamilyCare – the state’s primary Medicaid coverage program – since eligibility expanded under the Affordable Care Act in January 2014. Of those new enrollees, more than 340,000 are people who were newly eligible for Medicaid, while 79,000 of them were previously eligible but hadn’t signed up for the program.

With 1.7 million enrollees, FamilyCare now covers 19 percent of the state’s population.

While some states control Medicaid applications centrally through the state government, New Jersey has long had a county-based system. The new computer system -- the Consolidated Assistance Support System (CASS0) -- was supposed to improve information sharing between counties and the state.

The state has hired a vendor to analyze what can be salvaged from the CASS project and to develop future strategies for Medicaid and other social services.

“In the meantime, we will continue to build and enhance our technology and utilize the health benefits coordinator (Xerox) as much as we can,” Harr said.

Harr said the state is using several technological tools to speed application processing, including providing access to a federal website that determines whether applicants are eligible and, in a few weeks, implementing a new FamilyCare application that will enable applicants to provide their email address to improve communication.

The state and federal government have also recently completed an electronic link that will allow the state to receive applications directly from the federal health insurance marketplace site, healthcare.gov. Until now, the federal government has been transferring large files of applications to the state.

Another tool the state has offered counties allows the state to verify the incomes of large batches of applicants using state data.

The state has also developed an application that allows residents to apply for FamilyCare and the Supplemental Nutrition Assistance Program (SNAP, popularly known by its former name of food stamps), but Harr said it’s been only “mildly successful.”

“The response rate is not that great, but we did enroll 7,000 people that way,” she said.

The counties must process 450,000 redeterminations in the coming months, and Xerox will handle an additional estimated 150,000 to 200,000 redeterminations from people who enrolled in Medicaid through the federal marketplace.

“By shifting what we can over to our health benefits coordinator, we’re trying to assist the county welfare agencies in their volume,” Harr said.

Harr, who addressed the NJ FamilyCare backlog yesterday during a meeting of the Medical Assistance Advisory Council, didn’t have information on how much the additional work by Xerox will cost the state.

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