A pediatric practice we work with ran a clean eligibility check on a mother and her two children the day before their visits. All three showed active Medicaid. Two weeks later the claims for the children denied: the state had moved them to a different managed care plan on the first of the month, the 271 response the practice used showed only "Medicaid active" without the plan assignment, and the claims went to the old plan, which no longer had them as members. Three claims, one root cause, and it happens every month in practices that think they have eligibility covered.
The Medicaid unwinding, the return to normal eligibility renewals after the pandemic continuous enrollment period, ran from April 2023 until most states finished in mid-2024. Over 25 million people were disenrolled, about 69% of them for procedural reasons rather than because they were found ineligible, and enrollment fell by roughly 13 million from its peak. A large share of those who lost coverage came back within months, often under a different plan. That is the population walking into practices in 2025, and eligibility for them fails in specific, repeatable ways.
Key takeaways
- "Medicaid active" is not enough. The managed care plan assignment on the 271 or the state portal is the field that decides where the claim goes, and it changes at renewal, re-enrollment and choice periods.
- Re-run eligibility 30 and 60 days after any no-coverage denial; many states reinstate procedurally disenrolled members retroactively.
- Qualified Medicare Beneficiary patients cannot be billed Medicare cost sharing. Check the QMB indicator every visit and suppress their statements.
- Medicaid and MCO timely filing limits can be as short as 90 days, so a wrong-plan denial is a same-week task.
- Six-month redeterminations are in the House-passed budget bill now before the Senate. Build for more churn, not less.
The five ways Medicaid eligibility fails
1. Active coverage, wrong plan
In most states Medicaid is delivered through managed care organizations, and the state can reassign members at renewal, at re-enrollment after a gap, or during an annual choice period. The practice's eligibility response may say the patient is active without saying which MCO holds the risk that month, or the front desk may read the "active" flag and stop. The claim goes to the plan on the card, which is the old plan, and denies with CARC CO-109 (claim not covered by this payer) or CO-24 (charges covered under a capitation agreement). The fix is to read the plan segment of the 271 or check the state portal, every visit, and update the coverage record before the claim is created.
2. The gap month
A patient was disenrolled procedurally on the 31st and re-enrolled on the 15th of the following month after submitting the paperwork. Visits in the gap are uncovered unless the state grants retroactive coverage back to the disenrollment date, which many do when the person was in fact eligible throughout. Practices that bill the patient for the gap visit, or write it off, before checking for retroactive reinstatement leave money on the table. The check is simple: re-run eligibility 30 and 60 days after any denial for no coverage, and rebill if coverage now shows for the date of service.
3. Dual eligible patients billed for cost sharing
Patients in the Qualified Medicare Beneficiary program cannot be billed for Medicare deductibles, coinsurance or copays, and the practice must accept the Medicare payment plus whatever Medicaid pays as payment in full. Medicare remittances flag QMB status with remark codes N781 and N782, and the Medicare eligibility response carries a QMB indicator. Practices that send statements to QMB patients are violating federal rules, and it happens most often when the patient's Medicaid coverage was interrupted during the unwinding and the QMB flag disappeared and reappeared. Check the QMB indicator on every dual eligible patient at every visit and suppress statements for them.
4. Timely filing that is shorter than you think
Medicaid and Medicaid managed care timely filing limits vary widely by state and plan, from 90 or 95 days in some states to a year in others, and the clock for a rebill after a plan change is often measured from the original denial rather than the date of service. A claim sent to the wrong MCO, denied 30 days later, and not redirected for another 60 days can miss the window at the correct plan. The rule we teach is that a Medicaid denial for wrong payer is a same-week task, not a queue item.
5. Newborns and pregnancy coverage
Newborns of Medicaid-covered mothers are deemed eligible for a year, but the baby often has no Medicaid ID for the first several weeks and the claims for the first visits sit. Pregnancy-related coverage has its own postpartum period (12 months in most states now) and the mother's plan assignment may change at delivery. Both need a follow-up task, not a hold queue.
What a working Medicaid eligibility check looks like
| When | What to check | Where |
|---|---|---|
| 2 to 3 days before the visit | Active status, MCO assignment, effective dates, QMB or other dual status, primary care provider assignment if the plan requires one | 271 response with plan segment read, or state portal |
| At check-in | Re-run if the earlier check was more than 3 days ago or if it is the first week of the month; confirm the card matches the response | Real-time eligibility |
| Before claim creation | Coverage record in the billing system matches the response, including the correct MCO payer ID | Practice management system |
| On any eligibility denial | Re-run eligibility for the date of service; check for retroactive coverage or a different MCO; redirect within the week | Eligibility plus denial worklist |
| 30 and 60 days after a no-coverage denial | Retroactive reinstatement | Eligibility |
The first-of-the-month rule in the second row is there for a reason. Most states load plan reassignments and renewals effective on the first, so a check run on the 28th can be accurate on the 28th and wrong on the 1st. A practice that runs eligibility in a batch on Friday for Monday's schedule will be caught by this every month unless the batch is re-run for the first few business days of the month.
A worked example
Take a practice with 2,400 Medicaid visits a year across three MCOs. Its Medicaid eligibility denial rate is 6%, or about 144 claims a year, at an average allowed amount of $95. Of those, past experience says roughly half are wrong-plan denials that get paid once redirected, a quarter are gap-month denials where retroactive coverage is later granted, and a quarter are true no-coverage. If the practice redirects wrong-plan claims within a week and re-checks gap-month denials at 30 and 60 days, it recovers about 108 claims, roughly $10,000. If it treats every eligibility denial as a write-off, which is what a "no coverage" adjustment code in the practice management system quietly does, the same $10,000 disappears, and the practice's Medicaid collections look 4% worse than they should for reasons nobody can name.
The numbers to watch
Eligibility-related denials as a share of Medicaid claims (CARC CO-26, CO-27, CO-31, CO-109, CO-24), monthly by plan. The share of those denials that were resolved by rebilling to a different payer within 14 days, which measures how fast the wrong-plan problem is fixed. Medicaid claims written off to "no coverage" that were never re-checked for retroactive eligibility. And statements sent to patients with a QMB indicator, which should be zero.
Why this matters more in 2025
The House-passed budget bill now in the Senate would require six-month eligibility redeterminations for expansion adults and would shorten retroactive coverage from three months to one. Whether or not those provisions survive, the direction of policy is toward more frequent eligibility changes, not fewer. The practices that will handle it are the ones that treat Medicaid eligibility as a per-visit check with the plan assignment read every time. We think most practices should assume churn will rise and build for it now.
Eligibility verification is part of every Revelrex medical billing engagement, and eligibility denials are reported as their own category in the RCM audit. For teams that want to train front desk staff on the details, the RCM training calendar lists the next front-end session.
Questions we hear
Can we bill the patient when Medicaid denies for no coverage?
Only after confirming there was no coverage for the date of service and no retroactive reinstatement, and only within your state's rules on billing Medicaid-eligible patients. Many practices decide not to bill patients in this situation at all; if you do, the check for retroactive coverage comes first.
The patient has a Medicaid card but eligibility says inactive. Which is right?
The eligibility response. Cards are printed once and are not proof of current coverage. Ask the patient whether they completed their renewal and give them the state's enrollment contact.
How often should we re-run eligibility for established Medicaid patients?
Every visit. Annual or "new patient only" checks were never adequate for Medicaid, and after the unwinding they are a reliable way to lose claims.
What to do this month
- Check whether your eligibility tool returns the MCO assignment and whether staff read it. If it does not, find out how to get it (many state portals show it when the clearinghouse response does not).
- Pull Medicaid eligibility denials for the year and sort by plan and CARC. The largest category tells you which failure above you have.
- Pull every write-off coded to no coverage for Medicaid patients this year and re-run eligibility for the date of service.
- Run a report of patient statements sent to patients with Medicare and Medicaid coverage and check each for a QMB indicator.
- Write down your state's Medicaid and each MCO's timely filing limits and put them where the denial team can see them.
- Add a re-run of the eligibility batch for the first three business days of each month.
