Millions of Americans are at risk of losing Medicaid coverage as states resume annual eligibility reviews following the end of the COVID-19 Public Health Emergency continuous enrollment policy.

This “Medicaid unwinding” has exposed coverage churn. Many patients, including those still eligible, are being disenrolled for procedural reasons rather than true ineligibility. Federally Qualified Health Centers serve many of these vulnerable patients and are witnessing the fallout: families confused by renewal paperwork, lapses in care when coverage is lost, and increased uncompensated care burdens on clinics. The problem is especially pronounced in states with less streamlined renewal processes. For example, North Carolina managed to keep disenrollments low (only about 12% of those up for renewal) by using automatic renewals and recent policy changes, whereas Texas has seen far higher loss of coverage due to more manual, paperwork-heavy renewals. This disparity highlights how each state’s approach to Medicaid re-enrollment directly affects patients and FQHCs.

This brief aims to explore the challenges patients face in enrolling and staying enrolled in Medicaid and how those challenges impact FQHCs.

We compare North Carolina’s and Texas’s Medicaid re-enrollment policies to illustrate how supportive policies (like Medicaid expansion and automated renewals) versus more restrictive processes influence patient coverage continuity. Understanding these differences will help FQHC leaders anticipate issues and identify strategies to keep patients covered, such as outreach, education, and assisting with renewal paperwork. Ultimately, the goal is to support FQHCs in reducing Medicaid churn among patients, so that fewer people lose coverage unnecessarily and health centers can continue their mission with less interruption.

Medicaid churn is surging

Nationwide, over 25 million people have been disenrolled as states “unwind” continuous coverage, and roughly 70% of those lost coverage due to paperwork or procedural issues, not because they were ineligible (KFF, 2025). This means many eligible patients, including children and adults, are losing Medicaid simply for not completing forms or missed communications.

State renewal policies drive different outcomes

North Carolina kept procedural disenrollments low by adopting Medicaid expansion and using data-driven ex parte renewals automatically renewing majority of their members (KFF, 2025). In contrast, Texas (a non-expansion state) relied on manual renewals with minimal automation – its ex parte renewal rate was <4%, worst in the nation – leading to over 1.3 million Texans (mostly children) dropped for paperwork gaps in one year (Every Texan, 2024). The lack of automated renewals and stricter eligibility rules in Texas caused a massive coverage drop, whereas North Carolina’s efforts resulted in far fewer people losing coverage.

Patients face confusion and barriers in the re-enrollment process

Health centers report that most patients who lost coverage never got or understood the renewal notices. In a national survey, 85% of community health centers said patients did not understand the Medicaid renewal notice, 62% never received it, and many struggled with overwhelmed call centers and portals (Shin, 2024). These communication breakdowns are a major cause of procedural disenrollment. Language barriers, frequent address changes, and limited digital access exacerbate the problem for vulnerable populations.

Coverage gaps harm patients and FQHCs

When patients lose Medicaid, they often delay care or face unaffordable bills. Health centers nationwide report significant disruptions in care. About two-thirds of disenrolled patients have postponed or missed needed care, and nearly half lost access to specialist or hospital services when their insurance lapsed (Shin, 2024). For FQHCs, this means a rise in uninsured visits and uncompensated care. Revenue declines are expected as payer mix shifts, jeopardizing already thin operating margins. The impact is especially severe in non-expansion states like Texas.

FQHCs are taking action to reduce churn

Across the country, health centers have mobilized to help patients stay covered. Nearly all FQHCs are providing outreach and one-on-one assistance with Medicaid renewals. Updating contact information, explaining renewal forms, and helping patients submit documentation. Many are coordinating with state agencies, community organizations, and even hosting enrollment events to re-enroll those who were terminated. These efforts have had some success (about 26% of disenrolled patients had been reenrolled as of early 2024, per a Geiger Gibson Program in Community Health survey), but there is a long way to go. Proactive enrollment support is emerging as a critical service that FQHCs provide to maintain continuity of care for their communities.

Medicaid enrollment and retention challenges will remain a critical issue for FQHCs in the coming years. The experiences of North Carolina and Texas underscore that policy choices, like expanding Medicaid eligibility and simplifying renewals, can make a huge difference in whether eligible patients keep their coverage.

In states that streamline the process, fewer patients fall through the cracks, whereas difficult processes cause preventable loss of coverage. For FQHC leaders, understanding these dynamics is vital. By doubling down on patient outreach, advocacy, and assistance with Medicaid renewal, health centers can mitigate coverage gaps even when state policies are less than ideal. Ultimately, ensuring patients remain insured aligns with the core mission of FQHCs to provide accessible, continuous care. Keeping patients covered improves health outcomes and stabilizes clinic finances. A win-win that justifies the extra effort now to prevent eligible patients from needlessly losing Medicaid.

• Medicaid Continuous Coverage and the Unwinding: Background on the end of continuous enrollment, the scale of Medicaid coverage loss, and the resurgence of churn after the COVID-19 emergency period.
• Procedural Disenrollment and Coverage Churn: How paperwork and administrative hurdles have become the leading cause of Medicaid disenrollment, and why eligible patients (especially in certain states) are losing coverage.
• North Carolina vs. Texas: Medicaid Renewal Approaches: A comparison of two states’ policies and the impact on coverage retention. Highlighting North Carolina’s adoption of expansion and automated renewals versus Texas’s manual processes and limited eligibility.
• Coverage Loss Impacts on Patients and FQHCs: The consequences when Medicaid lapses: disruptions in care, worse health outcomes, and financial strains on FQHCs as uninsured rates rise.  With data on who is most affected (children, chronic conditions, etc.).
• FQHC Strategies to Support Patient Enrollment: Practical steps health centers are taking to reduce churn, from patient education and outreach to partnering with state agencies, plus recommended best practices to keep patients insured.

Peregrine Health exists to support the mission-driven work of community health centers, many of which operate on the thinnest of margins. Medicaid coverage isn’t just a policy issue, it’s a lifeline. When eligible patients fall through the cracks due to paperwork errors, procedural confusion, or systemic barriers, health centers absorb the financial consequences, and patients lose access to care they critically need. This dynamic is especially disruptive in behavioral health, where continuity of care is essential. Peregrine partners with FQHCs to improve access to behavioral health services, and we know from experience that insurance coverage is the foundation on which these efforts are built. By improving Medicaid retention and reenrollment processes, health centers can stabilize their operations, expand care access, and uphold their mission to serve the most vulnerable. It’s a challenge we face together and one we believe can be met with the right focus and resources.