DEPARTMENT OF HEALTH & HUMAN SERVICES 
Health Care Financing Administration 
Center for Medicaid and State Operations 
7500 Security Boulevard 
Baltimore, MD 21244-1850 
April 10, 2000 
Dear State Medicaid Director: 
The purpose of this letter is to clarify the Health Care Financing Administration=s (HCFA) 
expectations for State implementation of the Medicaid Statistical Information System (MSIS) 
reporting system, and the implications of delayed implementation. 
Effective in Federal Fiscal Year (FFY) 1999, the Balanced Budget Act (BBA) of 1997 requires that 
MSIS replace the annual hard-copy HCFA-2082 report as the primary source of Medicaid 
program statistical information.  MSIS requires quarterly tape submittals of Medicaid data 
extracted from State eligibility and claims history files.  These tapes must pass data quality reviews 
that include edit checks and distributional analysis of the data. During the implementation period 
for FFY 1999 MSIS, we have requested that States work to address data quality issues for a single 
quarter before submitting data for subsequent quarters. 
HCFA recognized that the systems changes needed to implement the 1999 MSIS system came at a 
time when States faced a number of systems challenges, including Y2K.  In recognition of these 
demands, HCFA allowed States significant flexibility in the timing of the submittal of the quarterly 
MSIS files for 1999, as long as the State was able to provide their MSIS file documentation, build 
the data files, clear the files through our data quality review, and submit the files for all four 
quarters in time to allow HCFA to create the needed FFY reporting. 
The due date for submittal of the full set of FFY 1999 tapes was December 15, 1999. Currently, 
we have many States who have not successfully submitted their data. Although we have allowed 
significant implementation flexibility, the MSIS data are critical to our ability to be accountable for 
a program representing over $190 billion in State and Federal expenditures. 
We have provided the enclosed chart showing the general status of State MSIS tape submittal for 
FFY 1999. Given the number of States that have been unsuccessful in implementing MSIS at this 
point in time we wanted to share this status with you and clarify our expectations for the time line to 
receive all required MSIS submittals.  We expect all States to have submitted their 
required MSIS documentation, initial quarter =s tapes, and follow up tapes that meet 
our data quality criteria for all four quarters no later than July 31, 2000. This time line 
represents a compromise between the normal due date of December 15, 1999 and our recognition 
of States= needs for lead time to complete this effort.  For States that are unable to successfully mobilize the resources to implement MSIS on this 
timetable, we will require that States submit a hard-copy HCFA-2082 report by July 31, 2000. 
Section 2700 of the State Medicaid Manual requires that States not successfully implementing 
MSIS for the full FFY 1999 must submit the hard-copy HCFA-2082. This report is NOT in lieu 
of continued expectations for State efforts to implement MSIS for 1999. States are expected to 
continue their efforts to implement MSIS. 
You need to know that failure to submit MSIS data violates a BBA-mandated 
Medicaid Management Information System (MMIS) requirement, and places your 
MMIS enhanced Federal matching in serious jeopardy of being reduced to 50-percent 
Federal financial participation. 
We plan to continue working with your staff as partners in this effort, and we expect that we will 
successfully implement MSIS in most States by the July 31, 2000 date.  We are committed to 
continuing to work with States with an appreciation of the demands they face, and we will do 
everything in our power to help the States implement this critical reporting system with as little 
disruption as possible. 
I want to thank you for the efforts of your staff in this endeavor, and for your continued support. 
Please refer any questions related to this letter to Betty Kern of my staff at 410-786-0141 or 
bkern@hcfa.gov. 
Sincerely, 
/s/ 
Timothy M. Westmoreland 
Director 
cc:

All HCFA Regional Administrators

All HCFA Associate Regional Administrators

for Medicaid and State Operations

Lee Partridge

Director, Health Policy Unit

American Public Human Services Association

Joy Wilson

Director, Health Committee

National Conference of State Legislatures

Matt Salo

Director of Health Legislation

National Governors= Association
 Eligibility Files Claims Files
Fiscal Year 1999
State Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 All tapes submitted/Validation Edits AND DQ
passed
Alabama
Alaska All or some tapes submitted/Validation Edits
and/or DQ not passed or pending
Arizona
Arkansas No tapes submitted
California
Colorado
Connecticut
Delaware
Dist. of Col. Note: HCFA's policy is not to process any subsequent
quarters' tapes until the designated test quarter has been
received, passed HCFA's Validation Edit program, AND
passed the HCFA contractor's Data Quality review.
Florida
Georgia
Hawaii
Idaho
Illinois
Iowa
Indiana
Kansas
Kentucky
Louisiana
Maryland
Maine
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
New Hampshire
North Carolina
North Dakota
New Jersey
Nevada
New Mexico
New York
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah Virginia 
Washington 
West Virginia 
Wisconsisn 
Wyoming