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 and CHIP Services
 
 
  
May 22, 2012 
 
Medicaid/CHIP Affordable Care Act Implementation 
Answers to Frequently Asked Questions 
 
Coordination Across Insurance Affordability Programs 
Q1:  How is CMS envisioning the shared eligibility service that will support interactions 
between insurance affordability programs and help ensure a seamless enrollment 
experience for consumers? 
A:  The process for making a MAGI-based eligibility determination is largely the same for all 
insurance affordability programs.  The Affordable Care Act requires a single, streamlined 
application, accompanied by a similar set of business rules and verification processes, and an 
adjudication work flow that is largely identical between Exchanges, Medicaid and CHIP 
programs. 
 
It is expected that State agencies that receive Federal funds from CMS to establish State-based 
Exchanges and provide for Medicaid and CHIP expansions coordinate efforts to produce a 
shared eligibility service or system that relies on a shared IT infrastructure and as such, cost 
allocate this service. 
 
A shared eligibility service is not the same as one system.  We define an eligibility service as a 
set of IT functions that produce an eligibility determination based upon MAGI. (For more 
information, see IT Guidance 2.0, http://www.medicaid.gov/Medicaid-CHIP-Program-
Information/By-Topics/Data-and-Systems/Downloads/exchangemedicaiditguidance.pdf.)  The 
service incorporates an application, a set of verifications (for citizenship, income, residency, etc.) 
and business rules that together determine how much financial assistance a consumer should 
receive to acquire affordable health insurance. 
 
While policies codified in final regulations allow legal authority for eligibility determinations to 
remain with state Medicaid agencies (for Medicaid) and Exchanges (for premium tax credits and 
cost-sharing reductions), the underlying business rules and processes are nearly identical, and 
should, to the maximum extent practical, rely upon a shared IT service(s) and infrastructure.  Page 2 
Q2:  Will the agreements between Medicaid/CHIP agencies and Exchanges regarding 
coordination be subject to public disclosure and/or public comments? 
A:  The agreement between Medicaid/CHIP agencies and Exchanges regarding coordination 
must be available to the Secretary upon request and will be subject to applicable disclosure laws, 
such as the Freedom of Information Act.  
 
Q3:  Will the Federally-Facilitated Exchange (FFE) only do assessments of Medicaid and 
CHIP eligibility or if a State desires will the FFE also make eligibility determinations for 
Medicaid and CHIP? 
A:  States can work with the Federally-Facilitated Exchange (FFE) regarding Medicaid and 
CHIP eligibility determinations in one of two ways.  The State may either establish an agreement 
whereby the FFE assesses applicants for Medicaid/CHIP eligibility based on MAGI and then 
transfers the applicants electronic accounts to the State Medicaid or CHIP agency to complete 
the eligibility determination.  Or the State may elect to accept MAGI-based eligibility 
determinations completed by the FFE as final determinations.  Regardless of the approach, the 
process should be as seamless as possible for the applicant with most eligibility determinations 
completed in near real-time as specified in our eligibility final rule at 435.912. 
 
Q4: In the case where the Exchange is conducting an eligibility assessment and then 
transferring the applicants information to the State Medicaid or CHIP agency to complete 
the eligibility determination, what standards will the Exchange use to make the assessment 
for Medicaid and CHIP eligibility? 
A:  The Exchange will utilize the States Medicaid and CHIP eligibility rules for conducting both 
eligibility determinations and eligibility assessments.  This will include application of the States 
MAGI income standards and related eligibility rules for the MAGI population.  The Exchange 
will also rely on a robust verification protocol that is consistent with Medicaid and CHIP 
regulations but which might not be the same protocol the State is otherwise using.   
 
If a State accepts assessments of eligibility from the Federally-Facilitated Exchange (FFE) and 
chooses to make the final eligibility determinations itself, once an individual has been assessed 
as Medicaid/CHIP eligible, their electronic account would be transferred to the State Medicaid or 
CHIP agency, which will complete the eligibility determination.  This process will include any 
additional verification required by the State that is consistent with the Federal verification 
regulations. 
 
Q5:  Can the Exchange determine Medicaid eligibility for non-MAGI groups? 
A:  If the Exchange is a governmental entity, States will have the option to enable their State-
based Exchange to make Medicaid eligibility determinations for non-MAGI eligibility groups.  
Depending on the arrangements made in each State, such an Exchange can make all Medicaid 
eligibility determinations, only eligibility determinations based on MAGI, or assessments of 
eligibility based on MAGI.  The FFE will not be making Medicaid eligibility determinations for 
non-MAGI groups; the FFE will either do final determinations or assessments for the MAGI 
eligibility groups. 
  Page 3 
Q6:   Is CMS planning to draft a standard agreement for State Medicaid and CHIP 
agencies to use with the State-based Exchange? 
A:  Yes.  CMS is working with States to develop a model agreement, and it is one of the tools 
that the Coverage Expansion Learning Collaborative will be considering.   
 
Q7: In situations where an Exchange makes Medicaid eligibility assessments rather than 
full determinations, will the determination be able to happen in real-time? 
A:  The goal is to have a seamless experience for consumers, with eligibility determinations 
made as quickly as possible regardless of which approach to eligibility determinations is in effect 
in a particular State.   CMS will be establishing, in collaboration with States and with an 
opportunity for public input, data reporting measures that will allow States, CMS and the public 
to have information about the enrollment process including the timing of eligibility 
determinations under different design approaches. 
 
Q8:  Can a State require Medicaid applicants who are applying to a State Medicaid agency 
to apply using the single streamlined application and therefore not get screened for a non-
MAGI eligibility category?   
A:  The single streamlined application will contain questions that are designed to identify 
individuals who may be eligible for Medicaid on a basis other than MAGI.  Today, many States 
use a simplified application that includes questions about disability status or the need for long-
term care.  The single streamlined application will have similar questions to help identify 
individuals who may need a Medicaid determination on a basis other than MAGI.  Once 
identified, the individuals would be asked to complete a supplemental application, or a separate 
application for non-MAGI groups. The application will be developed with State and public input; 
we will be interested in suggestions on how best to screen for non-MAGI eligibility. 
 
Q9:  Is there a potential conflict with the Medicaid requirement to process an application 
within 45 days and the Exchange rule that allows applicants 90 days to respond to requests 
to resolve information that is not reasonably compatible? 
A:   The requirements are different, but they are not in conflict.  The 45-day limit for Medicaid is 
the outer boundary limit by which a State must determine Medicaid eligibility for all individuals 
who apply on a basis other than disability, and as discussed above, we expect much quicker 
determinations in most cases.  The Medicaid program provides a reasonable opportunity period 
for individuals whose citizenship or immigration status cannot be verified.  Medicaid provides 
benefits for individuals during their reasonable opportunity period, who are otherwise eligible for  
Medicaid. The Exchange rule provides for a 90-day reasonable opportunity period for all factors 
of eligibility.  The Exchange determines eligibility without delay and then provides a 90-day 
reasonable opportunity period for the applicant to provide any additional required information.   
 
  Page 4 
Q10:  What does it mean for an individual to withdraw their Medicaid application in order 
to receive a determination of eligibility for Advance Premium Tax Credits (APTCs)?  
A:  In a State where the Exchange makes Medicaid and CHIP eligibility assessments, but not 
eligibility determinations, there are certain requirements that the Exchange must follow (found at 
42 CFR 155.302(b)) in order to ensure a smooth transition between programs.  When an 
eligibility assessment reveals that an applicant is potentially eligible for Medicaid or CHIP, the 
Exchange must transmit the individuals electronic account to the Medicaid or CHIP agency for 
completion of the eligibility determination.   
 
However, when an eligibility assessment reveals that an applicant does not appear to be 
Medicaid or CHIP-eligible, the Exchange does not have the authority to deny Medicaid/CHIP 
eligibility (because that is not the arrangement in that State).  The Exchange has the 
responsibility to notify applicants that they do not appear to be Medicaid/CHIP-eligible and 
provide them with the opportunity to either seek a formal Medicaid eligibility determination 
(which would delay the eligibility determination for an APTC), or to withdraw their application 
for Medicaid/CHIP and receive a determination for an APTC and a cost-sharing reduction 
(section 155.305(b)(4)).  We will address in further guidance how the withdrawal will be 
addressed in the case of an appeal of an APTC decision.