By Ann Sanner, Associated Press
December 18, 2013 - AP

COLUMBUS, Ohio (AP) -- Federal officials have begun sending Medicaid applications to states so they can enroll people, beginning with a handful of places where technical problems that have marred the new insurance marketplace are expected to be less of an issue.

Until now, the applications were not forwarded as promised to the states, which put the enrollment process in limbo for those who are eligible to get health care coverage through Medicaid.

"This is a step forward," said Matt Salo, executive director of the National Association of Medicaid Directors. "We're getting closer and closer."

The effort is the latest attempt to smooth the troubled rollout of the federally run insurance marketplace. Once states start getting the applicants' data from the federal government, they can determine whether it is reliable and correct, throw out duplicate applications and begin to enroll people in Medicaid, the expansion of which is a key part of President Barack Obama's health care law.

More than 800,000 people have been determined through the state and federal marketplaces to be eligible for Medicaid, the safety-net program for the poor and disabled.

The law uses a two-track approach to expand coverage for the uninsured — facilitating the sales of private insurance plans through the new federal and state insurance marketplaces and an extended version of Medicaid, though not all states are expanding it.

If low-income insurance shoppers qualified for Medicaid, the federal site was supposed to send their application to the Medicaid agency in their state. But that had yet to happen in the 36 states relying on the federal site.

Now, the federal Centers for Medicare and Medicaid Services says it has begun transferring account information to 10 states: Alabama, Delaware, Idaho, Nebraska, New Hampshire, New Mexico, Montana, Pennsylvania, Tennessee and West Virginia.

These states' systems were expected to process the information better than others, said Julie Bataille, communications director for the Centers for Medicare and Medicaid Services.

"When you talk about sharing data on the Medicaid side, there are a number of pieces that have to work together and sync in terms of the systems," Bataille told reporters this week.

Those transfers have not been seamless. In Pennsylvania, one application came through, which means the federal and state computer networks can communicate, said Eric Kiehl, a spokesman for the state's Department of Public Welfare. But he said it was riddled with technical problems and officials continue to try to address them, he said.

"It came through with so many errors that we can't even open it," Kiehl said Tuesday.

Alabama officials said they are ready to receive the information and are expecting it. But the state's Medicaid agency said Tuesday it hasn't gotten any transfers yet.

Idaho started to get files Tuesday to test. And officials in West Virginia expected a few transfers to come in over the weekend.

Ohio officials also said they are preparing to receive Medicaid cases for more than 20,000 residents, said Greg Moody, the director of the governor's Office of Health Transformation.

Salo said the problem has been that the federal government didn't have the technology to send the data. Now, states needs to have the capacity to receive it.

"It won't come all at once," he said. "As the state proves it's capable, the trickle will increase."

Getting people enrolled by Jan. 1, the deadline for applicants who want insurance coverage in 2014, will be a significant challenge, Salo said. But the deadlines matter less for Medicaid coverage, since the program has no enrollment period and coverage is applied retroactively.

Moody confirmed there shouldn't be a gap of coverage for Ohioans. He said the state hopes to have all the transferred applications processed by the end of January.

"If you're in the system," he said, "you're good on Jan. 1."

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Associated Press writers Seanna Adcox in Columbia, S.C.; Marc Levy in Harrisburg, Pa.; Jay Reeves in Birmingham, Ala.; Matthew Barakat in McLean, Va.; and John Miller in Boise, Idaho, contributed to this report.