Medicaid Unwinding in 2026: What Home Health Agencies Need to Know

The Medicaid unwinding was the largest coverage disruption in American healthcare since the creation of the programs themselves. Between 2023 and 2024, over 25 million people lost Medicaid coverage as states resumed eligibility redeterminations after the three-year COVID-19 continuous enrollment pause. For home health agencies, it was a revenue earthquake.

In 2026, the acute phase is over. But the aftershocks are not.

What Happened During the Unwinding

During the COVID-19 public health emergency, Congress required states to maintain continuous Medicaid enrollment as a condition of receiving enhanced federal matching funds. This meant that no one could be disenrolled from Medicaid regardless of changes in income, household composition, or other eligibility factors. Medicaid rolls swelled to record levels—over 90 million people at the peak.

When the continuous enrollment provision expired in March 2023, states began processing redeterminations for their entire Medicaid populations. The scale was unprecedented. States had to evaluate eligibility for every enrollee who had not been redetermined in three years.

The results were staggering. KFF's Medicaid Enrollment and Unwinding Tracker documented over 25 million disenrollments by mid-2024. The data revealed a troubling pattern: a substantial share of disenrollments were procedural, not based on actual ineligibility. People lost coverage because they did not return paperwork, because the state had an outdated address, or because of processing errors—not because they no longer qualified.

Where Things Stand in 2026

The mass unwinding is complete. States have worked through their backlogs. Annual redeterminations are back on their normal cycle. But "normal" is not the same as "stable." For a detailed look at how the redetermination process itself works and why it causes coverage gaps, see Medicaid Redetermination and Home Health.

Several factors make the post-unwinding landscape more volatile than the pre-pandemic baseline:

Re-enrollment churn. Many of the 25 million+ people who were disenrolled are re-enrolling. Some re-enrolled quickly. Others took months. Some are cycling on and off coverage as their circumstances change. This creates a population of patients with recent coverage disruptions who are statistically more likely to experience future gaps.

State system changes. Many states implemented new eligibility determination systems, changed managed care contracts, or restructured their enrollment processes during or after the unwinding. New systems mean new bugs, new processing delays, and new opportunities for procedural disenrollments.

Economic volatility. The post-pandemic economy has produced significant income volatility for lower-income households. Gig work, irregular hours, and fluctuating earnings push people above and below Medicaid income thresholds on a monthly basis. Each fluctuation is a potential coverage gap.

Procedural churn continues. The same factors that caused procedural disenrollments during the unwinding—outdated addresses, missed mail, complex renewal forms—continue to cause them during regular redetermination cycles. States have made improvements, but the fundamental challenge of maintaining accurate contact information and completed paperwork for a population that is often transient and resource-constrained has not been solved.

What This Means for Home Health Agencies

For home health agencies with significant Medicaid census, the post-unwinding era presents three specific risks:

1. Your patient panel includes people with recent coverage disruptions. If you serve patients who were disenrolled and re-enrolled during the unwinding, those patients have a demonstrated vulnerability to coverage gaps. They are more likely to experience another gap than patients who maintained continuous coverage throughout.

2. Annual redetermination cycles create predictable risk windows. Unlike the unwinding, which was a one-time surge, annual redeterminations happen on a rolling basis. Each month, a portion of your patients are going through redetermination. Each redetermination is a potential coverage loss event. See Medicaid Eligibility Churn: The Silent Revenue Killer for the financial breakdown of this ongoing risk.

3. Managed care plan transitions add complexity. In many states, Medicaid managed care contracts were rebid during or after the unwinding. Patients may have been auto-assigned to new MCOs, which means new payer IDs, new authorization requirements, and potential coverage gaps during transitions. Your billing team may be billing the wrong MCO without knowing it.

Lessons Agencies Should Have Learned

The agencies that weathered the unwinding with minimal revenue impact had one thing in common: they were checking eligibility frequently, not just at intake. They knew within days when a patient lost coverage and could pause services, help the patient re-enroll, or adjust their care plan accordingly.

The agencies that got hurt were the ones relying on intake-only verification or monthly batch checks. They discovered coverage losses when claims were denied, by which point weeks or months of unbillable services had accumulated. For the full argument for continuous monitoring, see Why Medicaid Eligibility Checking Matters for Home Health Agencies.

If your agency is still using intake-only eligibility verification, the unwinding should have been the wake-up call. If it was not, the ongoing redetermination cycle will be a slower but equally costly lesson. For the technical details of how eligibility verification works, see What Is Eligibility Verification?.

What to Do Now

Three concrete steps for home health agencies in 2026:

1. Implement rolling eligibility verification. Check every active Medicaid patient at least weekly. Higher-risk patients—those with recent coverage disruptions or approaching redetermination dates—should be checked more frequently.
2. Track redetermination dates. Know when each patient's Medicaid eligibility is due for redetermination. Proactively verify coverage around those dates. Some states publish redetermination schedules by enrollee; others require you to check via the 270/271 transaction.
3. Build a response protocol. When a coverage lapse is detected, have a defined process: pause scheduled visits, notify the patient, help them navigate re-enrollment if the disenrollment was procedural, and document everything. Quick response limits both revenue loss and the patient's service interruption.

How ClientCare Helps

ClientCare automates rolling eligibility verification for your entire patient roster. We check Medicaid, Medicare, and commercial coverage on a risk-adjusted schedule and surface risk tickets the moment coverage changes. You know within days when a patient loses coverage—not 30 to 60 days later when a claim bounces.

For agencies that built verification processes during the unwinding, ClientCare formalizes and automates what you are already doing. For agencies that have not yet made the shift, it is the fastest path from intake-only checking to rolling monitoring.