How Snail Mail Is Contributing to Medicaid Member Churn

By Jennifer Forster, MPA
Nov. 19, 2019

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A recent article in Kaiser Health News highlighted a growing problem – some states are canceling Medicaid members’ benefits based on one piece of mail returned by the U.S. Postal Service.

This policy saves states money – they no longer have the administrative costs of sending letters and processing returned mail. In addition, if an individual no longer qualifies for Medicaid benefits, the state doesn’t need to make monthly payments to managed care organizations to administer benefits and case management services. On the other hand, these policies can also contribute to higher healthcare costs over the long run. For people with chronic health conditions, loss of coverage can result in worsening health and costly hospital visits.

Medicaid Communications Designed for the 21st Century

In this day and age, “snail mail” is an outmoded way to communicate with all types of plan members. It’s also very poorly suited for Medicaid beneficiaries, since low-income families often move frequently and fail to update their mailing addresses with state authorities. Another weakness of paper-based communications is that the U.S. Postal Service is not highly dependable in rural areas.

Multi-modal, multi-channel outreach to Medicaid beneficiaries is a better solution. Eliza, HMS’ member engagement platform, helps health plans collect alternative methods of contacting members such as SMS text messages or email. This enables plans to reach out to Medicaid members with important messages, as well as with reminders to keep their contact information up-to-date with the state.

Multi-Modal, Multi-Channel Member Outreach Can Help

HMS’ Eliza solution can be used to deploy retention programs that reduce Medicaid churn related to missed renewal periods, unpaid premiums, or unsatisfied work requirements. Experience shows that multi-modal, multi-touch programs are most effective for getting Medicaid members to take action. In addition, retention rates tend to increase the more contact a member receives from their plan. For example:

  • Members who only received a letter from the state notifying them of their renewal date had a 50.6% retention rate.
  • Members who received two touches (a letter from the state, plus an automated call, letter, or email) had a 54% retention rate.
  • Members who received three outreaches (a state letter, a plan letter, and an automated call or email from the plan) had a 57% retention rate.

As more states implement work requirements for Medicaid beneficiaries, multi-modal and multi-channel communications will become more important in order to avoid negative, unintended consequences like Medicaid churn.

HMS recently collaborated with a health plan that serves the Medicaid population in Arkansas. The plan used Eliza to launch a program using automated phone, email, and text messages to communicate with members on two key topics:

  • Work requirements and support with work attestations. HMS informed members about new work requirements and educated them about how to report work activities so they could maintain health coverage.
  • Non-compliance warnings. HMS notified members if they failed to comply with work requirements in any given month. These communications advised members about how many more “strikes” they had before losing coverage. Providing members with “strike notices” improved compliance with the monthly attestation process the following month by as much as 25%.

The Medicaid members that HMS reached through our Eliza engagement platform had nearly an 8% higher retention rate at the end of the year than those members who were not reached. In addition, members responded positively to the electronic messages. Over three quarters (75%) wanted reminders to attest each month. Nearly all (91%) requested text messages and over half (55%) opted for email reminders.

Medicaid MCOs have seen great success with HMS’ approach to communications via Eliza’s multi-touch, multi-channel approach to member engagement. This strategy has improved retention by up to 10% compared with those not engaged.


Reducing Medicaid churn also has a direct impact on the healthcare costs. To estimate the financial impact of reducing member churn in your Medicaid population, check out our Retention Savings Calculator.

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