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:   May 27, 2011 
 
FROM:   Cindy Mann, JD  
Director    
Center for Medicaid, CHIP and Survey & Certification (CMCS)  
 
SUBJECT:   Recent Developments in Medicaid  
 
CMCS is pleased to release this Informational Bulletin highlighting several announcements from 
Medicaid, including: 
  A Notice of Proposed Rule Making on Access to Covered Medicaid Services, 
  A State Medicaid Director letter providing guidance on the use of administrative funds 
to support Health Information Exchange, 
  A new draft preprint state plan page for use in implementing Concurrent Hospice Care 
for Children in Medicaid and CHIP. 
 
Standards Assuring Access to Covered Medicaid Services 
On Friday, May 6, 2011, a Notice of Proposed Rule Making (NPRM) regarding Access to Covered 
Medicaid Services was published in the Federal Register. This proposed rule amends existing 
Federal regulations to create a standardized, transparent process for States to follow as part of their 
broader efforts to assure that payments are consistent with efficiency, economy, and quality of 
care and are sufficient to enlist enough providers so that care and services are available to the 
general population in the geographic area as required by section 1902(a)(30)(A) of the Social 
Security Act.  The proposed rule affects only Medicaid fee-for-service payments. We are eager to 
receive comments from States and other stakeholders on the proposed rule. 
 
The regulation implements a long standing statutory provision.  Currently, CMS requests that a 
State provide us information about access when it seeks a rate change, but we have not provided 
guidance to States on what is expected.   Partly as a result, the courts have stepped in.  The 
proposed rule does not create a new federal access standard.  Instead it proposes a process and a 
framework for States to analyze data available to them that they believe is relevant to their State, 
their beneficiary population and their delivery system, to ensure that beneficiaries have access to 
covered services.   
 
    Page 2  Informational Bulletin  
 
 
The NPRM also proposes to clarify and amend the regulations at 42 CFR 447.205, which require 
States to issue public notice to their providers when changing Medicaid payment methods and 
standards. The proposed changes to the public notice requirement intend to alleviate confusion 
regarding when States must issue notice to providers and recognize electronic media as a means to 
issue the notices.    
 
To read the regulation and for instructions on submitting comments on this NPRM, please visit: 
http://www.gpo.gov/fdsys/pkg/FR-2011-05-06/pdf/2011-10681.pdf  All comments on this 
NPRM must be received no later than 5 p.m. on July 5, 2011 via one of the following methods: 
 
  Electronically at http://www.regulations.gov. Follow the submit a comment instructions,  
  By regular mail, 
  By express or overnight mail, or 
  By hand or courier to the DC or Baltimore locations.  
Addresses for the last three options are provided within the NPRM at the above link. 
 
Use of Administrative Funds to Support Health Information Exchange as part of the 
Medicaid EHR Incentive Program 
On May 18, 2011, CMCS released a State Medicaid Directors (SMD) letter, available at 
http://www.cms.gov/smdl/downloads/SMD11004.pdf, providing further guidance to State 
Medicaid Agencies regarding the implementation of section 4201 of the American Recovery and 
Reinvestment Act of 2009 that established the Medicare and Medicaid Electronic Health Record 
(EHR) Incentive Programs.  
 
This letter builds upon an SMD letter released on August 17, 2010, 
(http://www.cms.gov/smdl/downloads/SMD10016.pdf) that provided guidance to States on 
allowable expenses for activities supporting the administration of the Medicaid EHR Incentive 
Program.  The August 17, 2010 SMD letter outlined CMS expectations relating to activities and 
potential State expenditures that may be eligible for the 90 percent Federal Financial Participation 
(FFP) for the purposes of administration and oversight of the EHR Incentive Payments. In 
addition, that letter provided initial direction regarding State Medicaid agencies role in promoting 
EHR adoption and Health Information Exchange (HIE).  
 
The May 18, 2011, SMD letter provides more detailed guidance about the potential roles that 
States might play in the development and sustaining of HIE and permissible use of FFP. 
Specifically, the letter outlines our approval criteria as it pertains to States involvement in HIE 
activities whose costs are divided equitably across other payers along the fair share principle, are 
appropriately cost-allocated, leverage efficiencies, and that are developmental and time-limited in 
nature. This letter also reiterates the principle that the 90 percent FFP would not be available for 
on-going HIE costs where these services are fully operational.   
 
 
 
  Page 3- Informational Bulletin 
 
Section 2302 of the Affordable Care Act  Concurrent Hospice Care for Children in 
Medicaid and CHIP 
A State Medicaid Directors (SMD) letter was released on September 9, 2010, providing guidance 
to States on the implementation of section 2302 of the Affordable Care Act, entitled Concurrent 
Care for Children.  (https://www.cms.gov/smdl/downloads/SMD10018.pdf)  In the letter we 
noted that CMS was revising the Medicaid State plan hospice preprint page of Attachment 3.1-A 
and 3.1-B to reflect this new feature of the hospice benefit.  We are now providing a draft 
template to be used when submitting revised pages to your States plan amendment (see 
Enclosures). This template should be used until such time as the OMB-approved preprint is 
available.  States are now required to amend State plans as necessary to add the hospice 
concurrent care legislation requirement, by checking the box in section 18 marked Provided in 
accordance with section 2302 of the Affordable Care Act. 
 
As background, section 2302 of the law amends section 1905(o)(1) and 2110(a)(23) of the Social 
Security Act to remove the prohibition of receiving curative treatment upon the election of the 
hospice benefit by or on behalf of a Medicaid or CHIP eligible child.  In the September 29, 2010 
letter, CMS clarified that hospice services are covered under the Medicaid and CHIP programs as 
an optional benefit, but also that the Early and Periodic Screening, Diagnostic and Treatment 
(EPSDT) provision requires Medicaid and CHIP programs operating as Medicaid expansions to 
provide all medically necessary services, including hospice services, to individuals under age 21.   
In order to qualify for the hospice benefit in either Medicaid or CHIP, a physician must certify that 
the eligible person is within the last 6 months of life. 
 
This provision was effective upon enactment of the Affordable Care Act on March 23, 2010.  
Therefore, under Medicaid, and CHIP programs operating as Medicaid expansions, we expect 
States to continue to provide medically necessary curative services, even after election of the 
hospice benefit by or on behalf of children receiving services effective on March 23, 2010.  States 
operating stand-alone CHIP programs that offer the optional hospice benefit must now provide it 
concurrently with medically necessary curative services. 
 
Questions regarding the Concurrent Care for Children may be directed to Linda Peltz, Director, 
Division of Benefits and Coverage, Disabled and Elderly Health Programs Group, at  
410-786-3399, or via email at linda.peltz@cms.hhs.gov. 
 
I hope you will find this information helpful.  Thank you for your continued commitment to 
Medicaid and CHIP.   
 
Enclosures    Revision:   HCFA-PM-86-20    (BERC)        ATTACHMENT 3.1-A 
  SEPTEMBER 1986          Page 7 
 
State/Territory_____________________________________________ 
 
AMOUNT, DURATION AND SCOPE OF MEDICAL  
AND REMEDIAL CARE AND SERVICES PROVIDED 
TO THE CATEGORICALLY NEEDY 
______________________________________________________________________________________ 
 
15.  a. Intermediate care facility services (other than such services in an institution for mental 
diseases) for persons determined in accordance with section 1902(a)(31)(A) of the Act, to be in 
need of such care. 
   
    [ ]   Provided        [ ]   No limitations    
 
[ ]   With limitations*       [ ]  Not Provided:   
 
b.  Including such services in a public institution (or distinct part thereof) for the mentally retarded 
or persons with related conditions. 
 
    [ ]   Provided        [ ]   No limitations    
 
[ ]   With limitations*       [ ]  Not Provided:   
 
 
  16.  Inpatient psychiatric facility services for individuals under 22 years of age.  
   
[ ]   Provided        [ ]   No limitations    
 
[ ]   With limitations*       [ ]   Not Provided:   
 
 
  17.  Nurse-midwife services  
 
    [ ]   Provided        [ ]   No limitations    
 
[ ]   With limitations*       [ ]  Not Provided:   
 
 
  18.  Hospice care (in accordance with section 1905(o) of the Act). 
 
[ ]   Provided                 [ ]   No limitations         [ ]   Provided in accordance with section 
2302  
              of the Affordable Care Act 
 
[ ]   With limitations*       [ ]  Not Provided:   
 
   
 
*Description provided on attachment 
 
______________________________________________________________________________ 
TN No.   ______ 
Supercedes      Approval Date    _______   Effective Date  _____ 
TN No.  _______  Revision:  HCFA-PM-86-20  (BERC)      ATTACHMENT 3.1-B 
SEPTEMBER 1986          Page 6 
 
State/Territory: ______________________________ 
 
AMOUNT, DURATION AND SCOPE OF MEDICAL  
AND REMEDIAL CARE AND SERVICES PROVIDED 
TO THE MEDICALLY NEEDY 
                                                                                                                                                         
 
c.  Intermediate care facility services. 
 
/ / Provided    / / No limitation    / / With limitations* 
 
15.    a.  Intermediate care facility services (other than such services in an institution 
for mental diseases) for persons determined in accordance with section 
1902(a)(31)(A) of the Act, to be in need of such care. 
 
/ / Provided    / / No limitation    / / With limitations* 
 
b.  Including such services in a public institution (or district part thereof) for  
the mentally retarded or persons with related conditions. 
 
/ / Provided    / / No limitation    / / With limitations* 
 
16.  Inpatient psychiatric facility services for individuals  under 22 years of age. 
 
/ / Provided    / / No limitation    / / With limitations* 
 
17.  Nurse-midwife services. 
 
/ / Provided    / / No limitation    / / With limitations* 
 
18.  Hospice care (in accordance with section 1905(o) of the Act). 
 
/ / Provided  / / No limitation    / / Provided in accordance with section 2302 of the 
            Affordable Care Act  
 
/ / With limitations* 
 
*Description provided on attachment- 
                                                                                                                                                      
TN No.   ______ 
Supercedes      Approval Date    _______   Effective Date  _____ 
TN No.  _______