CMS Offers Options to States to Aid Enrollment Under Medicaid Expansion

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By Brian Broderick  

In a May 17 letter to state health care officials, the federal government outlined strategies that states can use to boost Medicaid enrollment under the Affordable Care Act in a streamlined manner.

Among the strategies cited by the Centers for Medicare & Medicaid Services are adopting 12-month continuous eligibility for parents and other adults and enrolling parents based on their children's income eligibility.

CMS said the five specific “targeted enrollment strategies” would help identify and enroll people in Medicaid and make it easier to keep such people in Medicaid without requiring “an entire new application.” The strategies could help alleviate administrative demands on a new eligibility and enrollment system, said the CMS letter, signed by Cindy Mann, director of the Center for Medicaid and Children's Health Insurance Program Services at the federal agency.

“As we move forward toward 2014 [when Medicaid is set to expand under ACA], states are working hard to meet implementation goals and timeframes,” the CMS letter said. “We anticipate that the five strategies described in this letter will provide opportunities to ensure that eligible individuals get access to Medicaid coverage in a simple and streamlined manner.”

Joy Wilson, director of health policy for the National Conference of State Legislatures, told BNA May 20 that the information in the CMS letter is very helpful to states in that it offers ideas on how to make the expansion work and how to carry out the suggested strategies. Looking at the big picture of Medicaid expansion, she said that by the end of June there should be a pretty clear picture of how many states will expand Medicaid under ACA this year because of the scheduled end of legislative sessions. However, she noted that there is no hard deadline on the ACA Medicaid expansion, and states can work on Medicaid expansion in 2014 as well.

Five Strategies

The letter said enrollment strategies that target individuals likely to be eligible for Medicaid and for whom eligibility information is already in the state's files “provide important advantages both for uninsured individuals and for states.” Those strategies are:

• implementing the early adoption of Modified Adjusted Gross Income (MAGI)-based rules;

• extending the Medicaid renewal period so that renewals that would otherwise occur during the first quarter of calendar year 2014 (from Jan. 1, 2014, to March 31, 2014) occur later;

• enrolling individuals into Medicaid based on Supplemental Nutrition Assistance Program (SNAP) eligibility;

• enrolling parents into Medicaid based on children's income eligibility; and

• adopting 12-month continuous eligibility for parents and other adults.

 

CMS added that enhanced federal matching funds (90 percent of costs for development; 75 percent for operations) are available to “help cover the costs of any systems changes that may be needed to undertake these activities, as long as those systems meet applicable requirements.”

MAGI, Waiver

CMS noted that under ACA, eligibility for health coverage under all health insurance affordability programs (including Medicaid, CHIP, and an advanced premium tax credit) “generally will be based on a new Modified Adjusted Gross Income, or MAGI, methodology, which will entail defining household composition and executing income-counting procedures according to rules that differ from those currently in effect for Medicaid.” During a limited period, states will need to be able to determine Medicaid eligibility under both the MAGI rules and the current rules.

To avoid having to use two sets of rules, CMS said states can start using the MAGI-based methodology for certain populations as of Oct. 1, but the states will need a “time-limited section 1115 waiver.” CMS is offering the states a streamlined request and approval process for this waiver (states can email to SOTAUpdates@cms.hhs.gov).

On the second strategy, CMS said that states will need to be able to apply pre-MAGI rules and MAGI-based rules to anyone whose renewal occurs in the first quarter of 2014. However, CMS said states now have an option to extend the Medicaid renewal period. This option pushes the date of the renewals scheduled during the transition period beyond March 31, 2014, to enable the states to begin applying only MAGI-based eligibility rules to all regularly scheduled renewals beginning on April 1, 2014. Extending renewals can be done under a waiver similar to the MAGI waiver, and such requests can be combined.

SNAP Eligibility

Under ACA's Medicaid expansion, which not all states are pursuing, eligibility is available for those making up to 138 percent of the poverty level (133 percent, plus a 5 percent income disregard).

On the third strategy, enrolling people in Medicaid based on SNAP eligibility, CMS noted that to qualify for SNAP, a household's gross income cannot exceed 130 percent of the federal poverty level, and the income of most SNAP participants is lower. “Many Medicaid programs already consider income data from SNAP to be reliable and use it to renew Medicaid eligibility.”

The federal agency cited recent studies by the Center on Budget and Policy Priorities and the Urban Institute that found that “the vast majority of non-elderly, non-disabled individuals who receive SNAP benefits are very likely also to be financially eligible for Medicaid.” CMS said that, based on these analyses, it “is offering states the opportunity to streamline the enrollment into Medicaid of these non-elderly, non-disabled SNAP participants.” A state interested in implementing this strategy will need to request a waiver under Section 1902(e)(14)(A) authority--a section of the Social Security Act added by Section 2002 of ACA.

The fourth strategy calls for enrolling parents in Medicaid, based on children's income eligibility. CMS said in the letter that a large number of parents whose children are already enrolled in Medicaid are likely to meet the MAGI-based income-eligibility standards. It said states have the opportunity to facilitate the Medicaid enrollment of parents whose children are currently enrolled in Medicaid and who are likely to be Medicaid-eligible. “This opportunity is available for a temporary period and could remain in effect until such time as the initial influx of applications is addressed or the state is able to handle the demands associated with the new system most efficiently,” CMS said. States also will need a waiver to enroll such parents.

Avoiding 'Churning.'

The final strategy is 12-month continuous eligibility for parents and other adults.

CMS noted that since 1997, states have had the option “to guarantee a full year of coverage to children in their Medicaid and CHIP programs by providing 12 months of continuous eligibility. Under this option, children retain coverage for 12 months regardless of changes in family circumstances, such as income or household size.”

For states, CMS said this option can mitigate the problems associated with “churning,” which the agency described as the enrollment and re-enrollment of eligible people when they lose coverage “due to procedural reasons or slight fluctuations in income. As of January 2013, 32 states had adopted 12-month continuous eligibility in their Medicaid or CHIP programs for children, with 23 states implementing the option in both programs.”

To implement this approach for adults, CMS said demonstration authority (Section 1115 of the Social Security Act) is needed. The states with existing demonstrations should submit an amendment request, along with a revised budget neutrality agreement that includes the financial impact on the demonstration as a result of the amendment. States that do not have existing demonstrations should submit an application for a new demonstration, CMS said.

 


   

Text of the letter is at http://op.bna.com/hl.nsf/r?Open=bbrk-97vm6z.