Frequently Asked Questions are used to provide additional information and/or statutory guidance not found in State Medicaid Director Letters, State Health Official Letters, or CMCS Informational Bulletins. The different sets of FAQs as originally released can be accessed below.
Frequently Asked Questions
The Affordable Care Act established an income disregard equal to five percentage points of the FPL disregard "for the purposes of determining income eligibility" for individuals whose eligibility is based on MAGI. In our final rule issued July 15, 2013, we provide that the disregard is applied to the income calculation of individuals only to the extent that the disregard matters for the purposes of determining eligibility for Medicaid or CHIP under MAGI-based rules-that is, those for whom the application of the disregard means the difference between being eligible for Medicaid or CHIP and being ineligible.
The disregard matters for purposes of determining Medicaid or CHIP eligibility only in cases where individuals have MAGI-based income that is above the highest applicable income standard under the program (Medicaid or CHIP), but would be within that income standard if the disregard were applied. This is the case only when the MAGI-based income is no higher than five percent of the FPL higher than that income standard. The disregard would not be applied for a determination of the particular eligibility group in which the individual qualifies, but only for overall eligibility for Medicaid or CHIP. We understand that this policy changes how disregards have been applied in the past, but believe this policy should be administratively simple to apply, for example, by applying the disregard at the point before a decision of ineligibility based on income would otherwise be made. This also ensures that the disregard does not reduce the "newly eligible" population for whom the increased federal matching rate is available.
For example, in a state that extends coverage to the new adult group, if a parent applied and has MAGI-based income within five percentage points of the FPL above the net income standard for the mandatory parent/caretaker relative group, the disregard would not apply because the disregard would not be needed for eligibility. The parent could be made eligible in the adult group instead. In that same state, if a parent applied with MAGI income within five percentage points of the FPL above the net income standard for the adult group (133% FPL), the five percent disregard would be applied to ensure that the parent could obtain eligibility in Medicaid and the parent would be made eligible in the adult group.
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According to section 1902(e)(14)(D)(v) of the Act, implemented at 42 CFR 435.603(a)(3), a person enrolled in Medicaid on or before December 31, 2013, shall not be found ineligible solely because of the application of MAGI and new household composition rules before March 31, 2014, or the individual's next regular renewal date, whichever is later.
States have two options regarding implementation. They can apply both pre-MAGI rules and MAGI rules to anyone whose renewal date falls between January 1 and March 31, 2014 as described below. Alternately, states may request the waiver authority to delay renewals outlined in our May 17, 2013 guidance titled, "Facilitating Medicaid and CHIP Enrollment and Renewal in 2014" (available at http://medicaid.gov/sites/default/files/Federal-Policy-Guidance/downloads/SHO-13-003.pdf).
The steps described below will ensure that Medicaid enrollees who come up for renewal between January and March 2014 are addressed appropriately. For example, for an individual who comes up for renewal on February 1, 2014, states need to:
- Conduct an eligibility redetermination by applying MAGI-based methods (at the converted income standard). If eligible, renew coverage for a 12-month period ending in February 2015.
- If the individual is found to be ineligible under step 1, determine whether s/he remains eligible based on 2013 (current) methods and income standard. If so, a finding of eligibility until April 1, 2014 is necessary under the 2013 methods. Go to step 4.
- If the individual is not eligible per either step 1 or 2, consider whether the individual might be eligible on other bases of eligibility, and pursue any possibilities. If no other pathways apply, provide the individual with notice of termination and appeal rights and transfer their account to the Exchange (or CHIP) for eligibility determination and enrollment in a QHP (or CHIP).
- On April 1, 2014, for those who remain eligible per step 2 (using 2013 methods and income standards), consider whether the individual qualifies on other bases of eligibility. If the individual does, renew eligibility until April 1, 2015. If not, provide notice and appeal rights for termination effective April 1, 2014.
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States wishing to continue the practice of disregarding parental income may do so by adopting coverage of a reasonable classification of individuals under age 21 under section 42 CFR 435.222. In this case, the "reasonable classification" would be pregnant women under age 21 (or under age 18, 19, or 20). The statutory income standard for this group would be based on the state's AFDC payment standard in effect in the state in July 1996. But if a state uses section 1902(r)(2) of the Act to disregard all income for this group, as has been done for other reasonable classifications of children (such as those in state foster care), there will be no determination of income required for eligibility, and MAGI-based income requirements will not apply.
To effectuate this option, states should submit a state plan amendment (SPA) to amend Attachment 2.2-A of the Medicaid state plan to cover a reasonable classification of pregnant women under age 21 under 42 CFR 435.222. The state should also amend Supplement 8a to Attachment 2.6-A to disregard all income for this new group.
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Section 2001(a)(5)(B) of the Affordable Care Act (implemented through regulations for the Medicaid program at section 435.118) increased the minimum income limit applicable to Medicaid eligibility for the mandatory group for poverty-level related children aged 6-18 from 100 to 133 percent of the FPL under section 1902(a)(10)(A)(i)(VII) of the Act. Therefore, if a state is currently covering uninsured children up to 133 percent of the FPL under a separate CHIP, these children must be transitioned to the Medicaid state plan under this children's group effective January 1, 2014. CMS is available to work with states individually on their transition plans for this population.
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No. For the purposes of eligibility, these children are considered a mandatory Medicaid group for poverty-level related children under section 1902(a)(10)(A)(i)(VII) of the Act. As described below, states will continue to receive the CHIP matching rate for this population.
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Yes. Under the Medicaid mandatory group for poverty-level related children under section 1902(a)(10)(A)(i)(VII) of the Act, insured children must be covered in addition to uninsured children (please also see applicable match rate questions below). This is different from the rules governing a separate CHIP program, which preclude coverage for insured children.
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No. States continue to have the option to cover children above 133 percent of the FPL either under a Medicaid expansion or separate program. States must maintain CHIP "eligibility standards, methodologies, and procedures" for children that are no more restrictive than those in effect on March 23, 2010 as specified under the "maintenance of effort" provision at 2105(d)(3) of the Act. A parallel requirement in Medicaid can be found at sections 1902(a)(74) and 1902(gg) of the Act. These provisions are effective through September 30, 2019.
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Yes. The CHIP enhanced FMAP will continue to be available for children whose income is greater than the Medicaid applicable income level (defined in section 457.301 and based on the 1997 Medicaid income standard for children) after these children transition to Medicaid. This includes children who previously qualified for CHIP in a separate program and uninsured children whose family incomes are up to 133 percent of the Federal poverty level, and therefore will be eligible for Medicaid in 2014. Regular Medicaid matching rates will apply for all other children covered under the mandatory group for children aged 6-18-children with income no more than 100 percent FPL and insured children with income above 100 percent to 133 percent FPL.
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Yes. States that are transitioning children from a separate CHIP to the Medicaid state plan under the mandatory group for poverty-level related children under section 1902(a)(10)(A)(i)(VII) of the Act (which will be part of the newly consolidated mandatory group for children at 42 CFR 435.118), will need to submit both a Medicaid and CHIP SPA. The Medicaid SPA will need to be approved prior to, or simultaneously with, the CHIP SPA.
In addition, states that currently cover uninsured children aged 6-18 with income above 100 percent to 133 percent FPL under the Medicaid eligibility group for optional targeted low income children at section 1902(a)(10)(A)(ii)(XIV) of the Act (42 CFR 435.229) will need a Medicaid SPA to transition these children to the mandatory group for poverty-level related children under section 1902(a)(10)(A)(i)(VII) of the Act under the mandatory children's consolidated group at 42 CFR 435.118 and must expand their coverage to include insured children.
The SPA templates are available at http://www.medicaid.gov/State-Resource-Center/Medicaidand-CHIP-Program-Portal/Medicaid-and-CHIP-Program-Portal.html and CMS is available to provide technical assistance to states as they work through this transition.
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In order to ensure a smooth transition of children from a separate CHIP to Medicaid state plan coverage, we encourage states to consider the following points as they prepare for this transition. CMS will work with states on these issues as part of the CHIP SPA review process:
- Proper and timely notification to families, including detailed information on changes related to managed care plans, providers, benefits and cost sharing and what families can expect and need to do in preparation for the transition.
- Education and notification to key stakeholders, including providers, managed care plans, and carve outs, such as mental health or dental services.
- Establishment of a help line to address questions from families during the transition.
- Continuity of care for children in treatment, such as the transfer of prior authorization requests from CHIP to Medicaid providers.