Centers for Medicare & Medicaid Services: Streamlining Medicaid, Children's Health Insurance Program, Basic Health Program Application, Eligibility Determination, Enrollment, Renewal Processes

WASHINGTON, April 2 -- The U.S. Department of Health and Human Services Centers for Medicare and Medicaid Services has issued a rule, published in the Federal Register on April 2, 2024, entitled "Medicaid Program; Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes."

The rule was issued by Secretary Xavier Becerra.

Here are excerpts:

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SUMMARY:

This is the second part of a two-part final rule that simplifies the eligibility and enrollment processes for Medicaid, the Children's Health Insurance Program (CHIP), and the Basic Health Program (BHP). This rule aligns enrollment and renewal requirements for most individuals in Medicaid; establishes beneficiary protections related to returned mail; creates timeliness requirements for redeterminations of eligibility; makes transitions between programs easier; eliminates access barriers for children enrolled in CHIP by prohibiting premium lock-out periods, benefit limitations, and waiting periods; and modernizes recordkeeping requirements to ensure proper documentation of eligibility determinations.

DATES:

These regulations are effective on June 3, 2024.

FOR FURTHER INFORMATION CONTACT:

Stephanie Bell, (410) 786-0617, [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

Since 1965, Medicaid has been a cornerstone of America's health care system. The program provides free or low-cost health coverage to low-income individuals and families and helps meet the diverse health care needs of children, pregnant individuals, parents, older adults, and people with disabilities. For over 25 years, the Children's Health Insurance Program (CHIP) has stood on the shoulders of Medicaid with the goal of ensuring that all children have health insurance. Together these programs play a major role in making health care available and affordable to millions of Americans.

Access to health coverage expanded significantly in 2010 with enactment of the Patient Protection and Affordable Care Act (Pub. L. 111-148, enacted on March 23, 2010), as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152, enacted on March 30, 2010), together referred to as the Affordable Care Act (ACA). The ACA expanded Medicaid eligibility to low-income adults under age 65 without regard to parenting or disability status, simplified Medicaid and CHIP enrollment processes, and established health insurance Marketplaces where individuals without access to Medicaid, CHIP, or other comprehensive coverage could purchase coverage in a Qualified Health Plan (QHP). Many individuals with household income above the Medicaid and CHIP income standards became eligible for premium tax credits and/or cost-sharing reductions to help cover the cost of the coverage. In addition, the ACA provided States with the option of establishing a Basic Health Program (BHP), which can provide affordable health coverage to individuals whose household income is greater than 133 percent but does not exceed 200 percent of the Federal Poverty Level (FPL) (that is, lower income individuals who would otherwise be eligible to purchase coverage through the Marketplaces with financial subsidies). BHPs allow States to provide more affordable coverage for these individuals and to improve the continuity of care for those whose income fluctuates above and below the Medicaid and CHIP levels. To date, two States, New York and Minnesota, have established BHPs.

In addition to coverage expansion, the ACA also required the establishment of a seamless system of coverage for all insurance affordability programs (that is, Medicaid, CHIP, BHP, and the insurance affordability programs available through the Marketplaces). In accordance with sections 1943 and 2107(e)(1)(T) of the Social Security Act (the Act) and sections 1413 and 2201 of the ACA, individuals must be able to apply for, and enroll in, the program for which they qualify using a single application submitted to any program. We issued implementing regulations on March 23, 2012, titled "Medicaid program; Eligibility Changes Under the Affordable Care Act of 2010" final rule (77 FR 17144) (referred to hereafter as the "2012 eligibility final rule"), and July 15, 2013, titled "Medicaid and Children's Health Insurance Programs: Essential Health Benefits in Alternative Benefit Plans, Eligibility Notices, Fair Hearing and Appeal Processes, and Premiums and Cost Sharing; Exchanges: Eligibility and Enrollment" final rule (78 FR 42160) (referred to hereafter as the "2013 eligibility final rule"). These regulations focused on establishing a single streamlined application, aligning financial methodologies and procedures across insurance affordability programs, and maximizing electronic verification in order to create a streamlined, coordinated, and efficient eligibility and enrollment process for eligibility determinations based on modified adjusted gross income (MAGI).

Significant progress has been made in simplifying eligibility, enrollment, and renewal processes for applicants and enrollees, as well as reducing administrative burden on State agencies administering Medicaid, CHIP, and BHP, since the issuance of these regulations. The dynamic online applications developed by States and the Federally Facilitated Marketplace, which ask only those questions needed to determine eligibility, have reduced burden on applicants. Of the 48 States that reported application processing time data for the April 2023-June 2023 period, over half (57 percent) of all MAGI-based eligibility determinations at application were processed in under 24 hours.[1] By comparison, for the February 2018-April 2018 period, of the 42 States reporting application processing time data, only 31 percent of all MAGI-based eligibility determinations at application were processed in under 24 hours. Greater reliance on electronic verifications has reduced the need for individuals to find and submit, and for eligibility workers to review, copies of paper documentation, decreasing burden on both States and individuals and increasing[2] program integrity. Renewals completed using electronic information available to States have increased retention of eligible individuals, while also decreasing the administrative burden on both States and enrollees.

The critical role of Medicaid and CHIP in providing timely health care access was highlighted as the coronavirus disease 2019 ("COVID-19") spread across our country beginning in early 2020. Medicaid and CHIP ensured people who may have lost their jobs or been exposed to COVID-19, or both, had access to coverage, playing a critical role in the national response. States were eligible for a temporary increase in the Federal Medical Assistance Percentage (FMAP) throughout the COVID-19 public health emergency (PHE), if they met certain conditions specified in section 6008 of the Families First Coronavirus Response Act (FFCRA) (Pub. L. 116-127, March 18, 2020), amended by section 5131 of Division FF of the Consolidated Appropriations Act, 2023 (CAA, 2023) (Pub. L. 117-328, December 29, 2022). One such condition was the continuous enrollment condition described at section 6008(b)(3) of the FFCRA. This condition required States to maintain enrollment, through March 31, 2023, for all Medicaid beneficiaries who enrolled on or after March 18, 2020, with limited exceptions.

Under the CAA, 2023, the FFCRA's temporary FMAP increase was extended through December 31, 2023, at a gradually reducing rate, for States that continued to meet the conditions specified in subsections 6008(b)(1), (2), and (4) of the FFCRA, along with new conditions at subsection 6008(f) of the FFCRA.[3] Among the new conditions for enhanced FMAP were requirements to (a) complete eligibility redeterminations in accordance with all applicable Federal requirements (or alternative processes and procedures approved by CMS), (b) update beneficiary contact information, and (c) make a good faith effort to contact beneficiaries whose mail was returned to the State. Since early 2023, States have been engaged in an effort to unwind their continuous enrollment policies and return to normal eligibility and enrollment operations (this process has commonly been referred to as "unwinding"). CMS worked actively with States during this period to review their redetermination processes, approve alternatives when needed, and ensure that the enrollment protections established by the ACA were available to all applicants and beneficiaries during the unwinding period. This final rule builds upon these protections to promote enrollment and reduce churn.

The Biden-Harris Administration is committed to protecting and strengthening Medicaid and CHIP and has demonstrated this commitment through multiple executive actions. For example, on January 20, 2021, President Biden issued Executive Order 13985 on advancing racial equity and support for underserved communities.[4] It charged Federal agencies with identifying potential barriers that underserved communities may face to enrollment in programs like Medicaid and CHIP. This was followed on January 28, 2021, by Executive Order 14009 with a specific call to strengthen Medicaid and the ACA and remove barriers to obtaining coverage for the millions of individuals who are potentially eligible for coverage but remain uninsured.[5] In April 2022, President Biden issued another Executive order, building on progress and reflecting new Medicaid and CHIP flexibilities established by the American Rescue Plan Act of 2021 (ARP) (Pub. L. 117-2). Executive Order 14070, "Continuing to Strengthen Americans' Access to Affordable, Quality Health Coverage," charges Federal agencies with identifying ways to help more Americans enroll in quality health coverage.[6] It calls upon Federal agencies to examine policies and practices that make it easier for individuals to enroll in and retain coverage. Building on this charge, we reviewed the improvements made to implement the ACA, examined States' successes and challenges in enrolling eligible individuals, considered the changes brought about by the COVID-19 pandemic, and looked for gaps in our regulatory framework that continue to impede access to coverage.

We have learned through our experiences working with States and other interested parties that certain policies continue to result in unnecessary administrative burden and create barriers to enrollment and retention of coverage for eligible individuals. For example:

* Individuals whose eligibility is not based on MAGI (non-MAGI individuals)--such as, those whose eligibility is based on being age 65 or older, having blindness, or having a disability--generally were not included in the enrollment simplifications established under the ACA or our implementing regulations (the 2012 and 2013 eligibility final rules). This left such individuals at greater risk of being denied or losing coverage due to procedural reasons, including, for example, failure to return paperwork,[7] than their MAGI-based counterparts, even though we believe many are likely to continue to meet the substantive Medicaid eligibility criteria due to low likelihood of changes in their income or other circumstances.[8]

- Current regulations do not consistently provide clear timeframes for applicants and enrollees to return information needed by the State to make a determination of eligibility or for States to process and act upon information received. This may lead to unnecessary delays in processing applications and renewals and some individuals being denied increased assistance for which they have become eligible.

- Recordkeeping regulations, which are critical to ensuring appropriate and effective oversight to identify errors in State policies and operations, were last updated in 1986 and are both outdated and lacking in needed specificity. We believe these outdated requirements have contributed to inconsistent documentation policies across States, which may have furthered the incidence of improper Medicaid payments.

- Barriers to coverage that are not permitted under any other insurance affordability program--including lock-outs for individuals terminated due to non-payment of premiums, required periods of uninsurance prior to enrollment, and annual or lifetime caps on benefits--remain a State option in separate CHIPs.

Through the proposed rule that appeared in the Federal Register on September 7, 2022, entitled "Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes" (87 FR 54760) (referred to hereafter as the "September 2022 proposed rule"), we proposed policies designed to address these and other gaps, thereby streamlining Medicaid and CHIP eligibility and enrollment processes, reducing administrative burden on States and enrollees, and increasing enrollment and retention of eligible individuals. We also sought to improve the integrity of Medicaid and CHIP. Through the Payment Error Rate Measurement (PERM) program, the Medicaid Eligibility Quality Control (MEQC) program, and other CMS eligibility reviews, we have regular opportunities to work with States in reviewing their eligibility and enrollment processes. As a result of these reviews and other program integrity efforts, States are continually making improvements to their eligibility and enrollment systems both to enhance functionality and to correct any newly identified issues. We believe the changes finalized in this rule will further these efforts, and we will continue to work closely with States throughout implementation.

Current regulations at 42 CFR 433.112 establish conditions that State eligibility and enrollment systems must meet to qualify for enhanced Federal matching funds. Among these conditions, Sec.433.112(b)(14) requires that each State system support accurate and timely processing and adjudications of eligibility determinations, and effective communications with providers, beneficiaries, and the public. As States submit proposed changes to their eligibility and enrollment systems and implement new and/or enhanced functionality, we will continue to provide them with technical assistance on the policy requirements, conduct ongoing reviews of both the State policy and State systems, and ensure that all proposed changes support more accurate and timely processing of eligibility determinations.

We will also continue to explore other opportunities for reducing the incidence of beneficiary eligibility-related improper payments, including leveraging the enhanced funding available for design, implementation, and operation of State eligibility and enrollment systems, as well as mitigation and corrective action plans that address specific State challenges. Our goal is to ensure that eligible individuals can enroll and stay enrolled without unnecessary burden and that ineligible individuals are redirected to the appropriate coverage programs as quickly as possible.

On September 21, 2023, the "Streamlining Medicaid; Medicare Savings Program Eligibility Determination and Enrollment" final rule (88 FR 65230) (referred to hereafter as the "2023 Streamlining MSP Enrollment final rule") appeared in the Federal Register, which finalized provisions of our September 2022 proposed rule that were specific to individuals dually eligible for both Medicaid and Medicare. This rule addresses the remaining provisions of the September 2022 proposed rule. It is focused on aligning enrollment and renewal requirements for most individuals in Medicaid; improving access for medically needy individuals; establishing expectations for timely renewals and redeterminations of eligibility for individuals experiencing a change in circumstances; streamlining transitions between Medicaid and CHIP; eliminating access barriers for children enrolled in CHIP; removing unnecessary administrative barriers; and modernizing recordkeeping requirements to ensure proper documentation of eligibility determinations.

If any provision of this final rule is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, it shall be severable from this final rule and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances.

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[FR Doc. 2024-06566 Filed 3-27-24; 8:45 am]

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The document was published in the Federal Register: https://www.federalregister.gov/documents/2024/04/02/2024-06566/medicaid-program-streamlining-the-medicaid-childrens-health-insurance-program-and-basic-health

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