States Can Address Medicaid’s Unwinding Challenge for Early Intervention for Kids With Disabilities

HealthMar 22 2023

Substantial waitlists and unmet demand for early intervention services for young children with disabilities are delaying timely services within a critical window for children’s development. In April 2023, this issue will intensify as continuous Medicaid enrollment unwinds and federal match rates decline. Because Medicaid is an important, growing funding source for early intervention, these developments will make it even more difficult for children and families to receive necessary services. Thankfully, states can mitigate some of these challenges; in this blog, we describe three major steps states can take to ensure that Medicaid continues to support the healthy development of young children with disabilities.

Early intervention services—including occupational, physical, and speech therapies, among other services—support children’s cognitive, behavioral, motor, and language skills and can prevent the need for special education services. However, pandemic-related restrictions resulted in decreased referrals for early intervention, increased wait times for evaluation, and decreased rates of children receiving services. To receive early intervention services, children need to have a referral from their pediatricians, their early care and education providers, or their families, although eligibility criteria varies by state. However, in the pandemic’s first year, pediatrician visits plummeted, early care and education facilities closed, and parents of young children were left to juggle significant upheaval in their work and family lives—all of which depressed referrals for support. These challenges have been particularly severe for Black families, whose children were already underrepresented in early intervention programs. Compounding these challenges, as referral rates rebound, early intervention providers are losing workers: In some places, waitlists for early intervention evaluation and services have tripled in length. Such delays are likely to widen health and education inequities since children not served by early intervention can age into special education in the K-12 school system, where Black children are already disproportionately represented.

Big changes looming for Medicaid could further increase early intervention’s backlog. In April 2023, as a result of changes to continuous enrollment and the federal match rate, nearly 7 million children are expected to lose Medicaid, at least temporarily, as states re-determine which families are eligible. This loss of Medicaid coverage could produce care disruptions for children. For example, a child learning to walk in physical therapy through early intervention, but who loses their Medicaid coverage, may face disruptions in care if their state levies family fees that the family cannot manage, if the state has to narrow its eligibility criteria due to limited funds, or if the family simply assumes they are no longer eligible. Further, only a portion of the millions of children who lose Medicaid will regain it, following a potentially lengthy uninsured period. Changes in health insurance coverage, from Medicaid to the Children’s Health Insurance Program (CHIP), can also lead to changes in care utilization as providers are released from Medicaid’s requirement to screen for developmental issues and families are charged copays for early intervention visits (which can be several times a week). Together, these pending changes should give early intervention providers reason to expect significant care disruptions, complicating their existing backlog.

Fortunately, states can minimize Medicaid disruptions and harms to young children with disabilities and their developmental trajectories. First, while the 2023 Consolidated Appropriations Act requires states to provide 12-month continuous enrollment for children in Medicaid starting in 2024, states could make children who are eligible for Medicaid at birth continuously eligible to as late as their sixth birthday; four states—Oregon, Washington, California, and New Mexico—are currently in the process of implementing such guaranteed coverage. Second, states can follow best practices for a smooth unwinding of continuous enrollment, such as allowing extra time for families to submit renewal forms, texting and calling families in addition to sending letters, and enlisting partners to help. Third, states could increase connections between early intervention programs and Medicaid agencies and between Medicaid agencies and CHIP offices. These connections will help states meet the data reporting requirements in the Consolidated Appropriations Act and set them up to comply with proposed rule changes from the Centers for Medicare and Medicaid Services that would make it easier to enroll in Medicaid and renew coverage for Medicaid and CHIP, facilitate transitions between Medicaid and CHIP, and eliminate CHIP aspects that create barriers to care for children.

Kindergarten teachers shouldn’t have to stress that the children coming into their classrooms will have a myriad of unmet health, developmental, and social and emotional needs that could require special education services. If states act to minimize disruptions in early intervention from Medicaid changes, they could avoid exacerbating current needs and inequities among our youngest learners.

Suggested Citation

Wilkinson, A., & Harper, K. (2023). States can minimize disruptions to early intervention for children with disabilities as Medicaid continuous enrollment unwinds. Child Trends. https://childtrends.org/blog/states-can-address-medicaids-unwinding-challenge-for-early-intervention-for-kids-with-disabilities

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