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Presumptive Eligibility: Hospital vs. Vendor Roles

Presumptive Eligibility

The process for presumptive Medicaid eligibility varies widely by state.  The purpose of hospital PE is to provide a quick option for those that appear to be eligible to receive immediate medical coverage.  It is imperative that hospitals review and understand their individual state’s regulations to ensure full compliance because patient eligibility has a direct impact on a hospital’s bottom line.

Medicaid and Medicare patients usually make up more than half of a hospital’s patient base, therefore reimbursement from these programs drives hospital financial performance.  Once individuals or families are temporary enrolled under presumptive eligibility, they will be more likely to follow through with the entire enrollment process.

HPE Determinations

Once a hospital is qualified, any hospital employee that is properly trained and certified is able to make HPE determinations, included those in hospital-owned practices or clinics.  Non-trained hospital employees are not allowed to make HPE determinations.  Detailed training materials to help hospital employees with the determination process are usually provided by the state.  

Application Process

While many states do not require a full application in order for an individual to receive a hospital presumptive eligibility coverage, a completed application is necessary for continued coverage.  Most states require that qualified entities (i.e. hospitals) assist patients who meet the income standard in Medicaid or CHIP, in completing a full Medicaid application during the PE period.  Some states use a short-form hospital PE application and then direct the qualified individual to complete a full application by the end of the PE period.

Third-Party Vendors: Do You Need One?

Some hospitals choose to outsource portions of the PE process.  A hospital may use a vendor when they do not have enough information to make an accurate HPE determination.   For example, if there is no evidence to support a patient’s eligibility, a third-party vendor would be able to assist a hospital by determining estimated income amounts.  The third-party organization uses predictive models and public record databases, such as the credit bureau, to assign patients a financial capacity score.  The hospital can then make a better decision regarding eligibility.

If a hospital finds their staff is overwhelmed with the growing number of eligibility cases, a vendor would be able to help the hospital recover every reimbursement dollar available.

Continued Eligibility: Don’t Neglect It

Once an individual is qualified, he or she is deemed eligible for 12 months, even if medical or financial circumstances change.  After the 12 months, a Medicaid renewal form must be filled out by the individual.  The process of renewal can be a cumbersome one, but is very important to the hospital so that the patient’s care is still covered by Medicaid if necessary.

If the hospital is unable to manage and track all eligibility cases, an eligibility vendor would be able to help with the tracking of patients that are up for renewal.  It is up to the hospital to put a system in place to ensure the eligibility process is continual and consistent well-beyond the PE period, based on their staffing situation and budget.


As many individuals struggle to understand the Medicaid application process, hospitals should make applying for PE and then completing the full application as easy as possible for the applicant.  Implementing a detailed training program for the HPE determination will ensure accuracy, and following up with each Medicaid-eligible patient will ensure maximum reimbursement for patient care.

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