Medicaid Program; Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes

<RULE> DEPARTMENT OF HEALTH AND HUMAN SERVICES <SUBAGY>Centers for Medicare & Medicaid Services</SUBAGY> <CFR>42 CFR Parts 431, 435, 436, 447, 457, and 600</CFR> <DEPDOC>[CMS-2421-F2]</DEPDOC> <RIN>RIN 0938-AU00</RIN> <SUBJECT>Medicaid Program; Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Centers for Medicare & Medicaid Services (CMS), Department of Health and Human Services (HHS). <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> 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. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> These regulations are effective on June 3, 2024. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Stephanie Bell, (410) 786-0617, <E T="03">Stephanie.Bell@cms.hhs.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> 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. <SU>1</SU> <FTREF/> 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  <SU>2</SU> <FTREF/> 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. <FTNT> <SU>1</SU>  MAGI Application Processing Time Snapshot Report: April 2023-June 2023; accessed on 11/17/2023 at <E T="03">https://www.medicaid.gov/sites/default/files/2023-10/magi-app-process-time-snapshot-rpt-apr-jun-2023.pdf.</E> </FTNT> <FTNT> <SU>2</SU>  MAGI Application Processing Time Snapshot Report: April 2023-June 2023; accessed on 1/18/2024 at <E T="03">https://www.medicaid.gov/sites/default/files/2020-04/magi-application-time-report.pdf.</E> </FTNT> 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. <SU>3</SU> <FTREF/> 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. <FTNT> <SU>3</SU>  See the January 2023 State Health Official (SHO) #23-002, “RE: Medicaid Continuous Enrollment Condition Changes, Conditions for Receiving the FFCRA Temporary FMAP Increase, Reporting Requirements, and Enforcement Provisions in the Consolidated Appropriations Act, 2023, for additional information on the “unwinding period.” Available on ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 614k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━