DEPARTMENT OF HEALTH AND HUMAN SERVICES  
Centers for Medicare & Medicaid Services  
7500 Security Boulevard, Mail Stop S2-26-12  
Baltimore, MD 21244-1850                                                                                                     
 
Center for Medicaid, CHIP and Survey & Certification 
  
 
CMCS Informational Bulletin  
 
DATE:   June 17, 2011 
 
FROM:   Cindy Mann, JD  
Director    
  Center for Medicaid, CHIP and Survey & Certification (CMCS)  
 
SUBJECT:   Updates on Medicaid/CHIP and the Pre-Existing Condition Insurance Plan  
 
This Informational Bulletin covers five important topics of interest to States: 
  Provider Preventable Conditions;  
  Coverage and Service Design Opportunities for Individuals living with HIV; 
  Same Sex Partners and Medicaid Liens, Transfers of Assets, and Estate Recovery;  
  The Pre-Existing Condition Insurance Plan; and 
  CMS Medicaid EHR Incentive Program, tribal clinics and FQHCs. 
 
 
Provider Preventable Conditions  Final Rule 
A new provision of the Affordable Care Act ensures that Medicaid payment policies are linked to 
quality and safety, consistent with actions many States have already taken.  Section 2702 of the 
Affordable Care Act prohibits Federal payments under section 1903 of the Social Security Act 
for any amounts expended for providing medical assistance for health care-acquired conditions.  
The statute requires that the Medicare Hospital Acquired Conditions (HACs) be used as a 
baseline, and also that CMS identify existing State practices and incorporate them as appropriate.   
The final rule: 
  Identifies Health care-acquired conditions (HCACs) (defined as Medicare Hospital 
Acquired Conditions (with one exception for DVT/PE following total knee replacement 
and hip replacement, as related to children and pregnant women) and three National 
Coverage Determinations (wrong site, wrong surgery, wrong patient) as a baseline for 
those policies; and 
  Authorizes States to identify other provider-preventable conditions (OPPCs) for which, 
with CMS approval, Medicaid payment will be prohibited.  
The final rule is effective on July 1, 2011, although compliance action will not be taken until  
July 1, 2012 to allow States additional time to develop and adopt their policies.  For more 
information on the final rule, please visit: 
http://www.gpo.gov/fdsys/pkg/FR-2011-06-06/pdf/2011-13819.pdf.  
 
  Page 2  Informational Bulletin 
 
Coverage and Service Design Opportunities for Individuals with HIV 
 
On June 6, 2011, CMCS released a State Medicaid Directors letter, in support of President 
Obamas National HIV/AIDS Strategy (the Strategy), informing States of the opportunities 
available to provide Medicaid coverage to individuals living with HIV.  This guidance informs 
States of coverage and service design opportunities that may assist States in increasing access to 
care for individuals living with HIV and provides alternatives that could alleviate the current 
burden to AIDS Drug Assistance Programs (ADAP).   
 
In addition, this letter provides guidance and a template to States that wish to submit applications 
for section 1115 demonstrations to cover individuals living with HIV who are not otherwise 
eligible for Medicaid.   
 
For more information on how these Medicaid programs can help States to extend coverage to 
individuals living with HIV, please visit https://www.cms.gov/smdl/downloads/11-005.pdf. 
 
 
Same Sex Partners and Medicaid Liens, Transfers of Assets, and Estate Recovery  
 
On June 10, 2011, CMCS released a State Medicaid Directors letter providing guidance to Medicaid 
agencies informing them of the existing options and flexibilities regarding the application of 
Medicaid liens, transfer of assets, and estate recovery.  This guidance clarifies that States can 
extend the protections available under the law in these areas to the same-sex spouse or domestic 
partner of a Medicaid enrollee.   
 
For more information, please visit: http://www.cms.gov/smdl/downloads/SMD11-006.pdf 
 
 
Pre-Existing Condition Insurance Plan  
 
New rules for the Pre-Existing Condition Insurance Plan (PCIP) were announced on               
May 31, 2011.  The PCIP was created under the Affordable Care Act to ensure more Americans 
with pre-existing conditions have access to affordable health insurance, and serves as a bridge to 
2014 when insurers will no longer be allowed to deny coverage to people with any pre-existing 
condition, like cancer, diabetes, and asthma.  In 23 States and the District of Columbia, the PCIP 
program is Federally-administered.  The remaining States operate their own PCIP programs 
using Federal funds provided by the Affordable Care Act. 
 
Premiums for PCIP will drop as much as 40 percent in 18 States, and eligibility standards will be 
eased in 23 States and the District of Columbia to ensure more Americans with pre-existing 
conditions have access to affordable health insurance.  In addition, starting July 1, 2011, people 
applying for coverage can simply provide a letter from a doctor, physician assistant, or nurse 
practitioner dated within the past 12 months stating that they have or, at any time in the past, had 
a medical condition, disability, or illness.  Applicants will no longer have to wait for an insurance 
company to send them a denial letter.  This option became available to children under age 19 in 
February, and this pathway is being extended to all applicants regardless of age.  Applicants will 
still need to meet other eligibility criteria, including that they are U.S. citizens or residing in the 
U.S. legally and that they have been without health coverage for six months. 
  Page 3  Informational Bulletin 
 
Beginning this fall, the Department of Health and Human Services (HHS) will begin paying 
agents and brokers for successfully connecting eligible people with the PCIP program.  This step 
will help reach those who are eligible but un-enrolled.  Several States have experimented with 
such payments with good success.  This is a part of continuing HHS outreach efforts with States, 
insurers, providers, and agents and brokers to reach more eligible people and let them know that 
coverage is available.  HHS is also working with insurers to notify people about the PCIP option 
in their State when their application for health insurance is denied.   
 
To find a chart showing changes to PCIP premiums in the States with Federally-administered 
PCIP programs, visit www.HealthCare.gov/news/factsheets/pcip05312011a.html.  
 
Consumers can find information on eligibility, plan benefits and rates and how to apply by 
visiting www.pcip.gov and click on Find Your State.  Then select your State from a map of the 
United States or from the drop-down menu.  The PCIP Call Center is open from 8 a.m. to 11 p.m. 
Eastern Time at 1-866-717-5826 (TTY 1-866-561-1604).  
 
 
CMS Medicaid EHR Incentive Program, tribal clinics and FQHCs 
 
After consideration of stakeholder feedback, CMS modified and updated the Frequently Asked 
Question (FAQ) that originally required tribal clinics to be paid as Federally Qualified Health 
Centers (FQHCs) in order to be treated as FQHCs for the Medicaid Electronic Health Record 
(EHR) Incentive Program. We will now allow all tribal clinics to be treated as FQHCs with 
respect to the Medicaid EHR Incentives. Please note that tribal clinics are not eligible for the 
Medicare and Medicaid EHR Incentive Program, but the eligible professionals at these locations 
may be eligible when they meet all other program requirements. This updated FAQ means that 
eligible professionals in tribal clinics may be subject to the needy individual patient volume 
threshold, rather than the Medicaid patient volume threshold, which will help these eligible 
professionals to qualify for the incentives.  
 
For more information on the EHR incentives, including information about program eligibility 
and payments, please visit the CMS EHR Incentive Program website: 
http://www.cms.gov/EHRIncentivePrograms/.  The new FAQ can be found here and is also 
copied below.  If you have any follow-up questions, please contact Michelle.Mills@cms.hhs.gov 
and Samuel.Schaffzin@cms.hhs.gov.  
 
Updated FAQ #10417: 
http://questions.cms.hhs.gov/app/answers/detail/a_id/10417/kw/tribal/session/L3NpZC8x
bVN1S0F3aw%3D%3D 
 
Can tribal clinics be treated as Federally Qualified Health Centers (FQHCs) for 
the Medicaid Electronic Health Record (EHR) Incentive Program? 
 
CMS previously issued guidance stating that health care facilities owned and 
operated by American Indian and Alaska Native tribes and tribal organizations 
("tribal clinics") with funding authorized by the Indian Self-Determination and 
Education Assistance Act (Public Law 93-638, as amended)  must be reimbursed 
as FQHCs in order to be considered FQHCs in the Medicaid EHR Incentive 
Program. CMS revised this policy and will allow any such tribal clinics to be  Page 4  Informational Bulletin 
 
considered as FQHCs for the Medicaid EHR Incentive Program, regardless of 
their reimbursement arrangements. For more information on how FQHCs are 
defined, please see FAQ #10127. 
 
For more information about the Medicare and Medicaid EHR Incentive Program, 
please visit http://www.cms.gov/EHRIncentivePrograms. 
 
I hope you will find this information helpful.