DEPARTMENT OF HEALTH AND HUMAN SERVICES 
Centers for Medicare & Medicaid Services 
7500 Security Boulevard, Mail Stop S2-26-12 
Baltimore, MD 21244-1850 
CMCS Informational bulletin 
DATE:  June 7, 2017 
FROM:  Brian Neale, Director 
Center for Medicaid and CHIP Services 
Tim Engelhardt, Director 
Medicare-Medicaid Coordination Office 
SUBJECT:   Strategies to Streamline Transitions for Medicaid-eligible Beneficiaries Who 
Newly Qualify for Medicare 
Individuals age 65 and over, as well as those under age 65 who are eligible for Medicare, are not 
eligible for coverage under the adult group codified at 42 CFR 435.119.  An increasing number 
of Medicaid beneficiaries in the adult group are being affected by this limitation.  This includes 
those beneficiaries turning age 65 and beneficiaries receiving Social Security Disability 
Insurance benefits who are coming to the end of the 24-month qualifying period for Medicare.  
While Medicare eligibility disqualifies individuals from being eligible under the Medicaid 
expansion group, many will be able to retain eligibility for Medicaid under another eligibility 
group and/or be eligible for the Medicare Savings Programs (MSPs), which provide assistance 
with at least Medicare premiums, and in many cases, Medicare Part A and Part B cost-sharing. 
We are issuing this Informational Bulletin to promote smooth transitions for individuals in the 
adult group who become Medicare eligible.  Specifically, we are: 1) clarifying required 
processes for completing redeterminations of eligibility when Medicaid adult group beneficiaries 
turn 65 or attain Medicare eligibility; and 2) highlighting opportunities for states to promote 
smooth transitions for these beneficiaries while reducing administrative burden on them and 
states.  
Redetermining Medicaid Eligibility for Adult Group Enrollees Who Newly Qualify for 
Medicare  
Identifying Adult Group Beneficiaries who Gain Medicare Eligibility  
Under our regulations and longstanding Medicaid policy, states must promptly redetermine 
eligibility whenever they anticipate or receive information about a change in a beneficiarys 
circumstances that may affect eligibility.1  For the adult group, this includes when the 
beneficiary turns 65 or becomes eligible to enroll in Medicare.  Before terminating a beneficiary 
from Medicaid altogether, states also are required to determine whether the individual may be 
eligible under a different eligibility group, including, in the case of beneficiaries eligible for 
Medicare, eligibility for MSPs.  This determination is done using information available to the 
1 42 CFR  435.916(d)  CMCS Informational Bulletin  Page 2 
 
 
state in the beneficiarys record or from other sources, or through a request for additional 
information needed to determine eligibility for other groups.2    
 
Implementing processes to identify these individuals early will help the state to complete a 
redetermination of eligibility under other eligibility groups in advance of the start of Medicare 
eligibility.  When determining how far in advance to redetermine eligibility, it is helpful to plan 
to build in sufficient time to request and process any additional information needed to complete a 
redetermination.  Ways to promote early identification include setting a flag in the states 
eligibility system to begin the redetermination process several months before the beneficiary is 
expected to become Medicare eligible; leveraging available data matching processes;3 or using 
information provided by the beneficiary or third-party sources.   
 
Completing a Redetermination 
Standard notice and fair hearing rights apply to individuals losing coverage under the Medicaid 
expansion group.  When an individual qualifies for another Medicaid group, this means 
providing adequate and timely notice of change in eligibility from the Medicaid expansion group 
to the new basis of eligibility, effective date of eligibility, basic information on the level of 
benefits and services available under the new basis, as well as the rights and responsibilities 
associated with eligibility under the group.  If the change in eligibility groups results in a 
reduction in benefits (as would be the case for individuals shifting from the Medicaid expansion 
group to the MSP) or a reduction in Medicaid eligibility, fair hearing rights must also be 
provided.  In circumstances where individuals are determined not eligible for Medicaid on 
another basis, advance notice of termination and the opportunity to request a fair hearing is 
required.4 
 
Options for States to Streamline the Redetermination Process for the Adult Group 
Beneficiaries Who Newly Qualify for Medicare 
 
There are several strategies available to states to help streamline operations, ease 
beneficiary transitions, and ensure continuity of coverage.   
   
Notices and Beneficiary Communications 
   
Early outreach:  State may reach out to the beneficiary well in advance of his or her expected 
loss of eligibility under the Medicaid expansion group to explain what steps (if any) the 
beneficiary will need to take to be determined eligible for the MSP or other non-MAGI Medicaid 
categories.  This type of early outreach allows states to redetermine eligibility for beneficiaries 
before they no longer meet the eligibility requirements of the adult group.  
 
                                                 
2 42 CFR 435.916(e)(f) and 435.930. 
3 States may obtain advance notice via the CMS response to their monthly Medicare Modernization Act State File 
(i.e., by submitting records on via prospective dual enrollment process; for detailed submission and processing of 
the PRO records, see sections 2.2-2.6  in the 2014 MMA Data Dictionary, version 2.7, modified April 4, 2014), or 
on an ad hoc basis by submitting a Territory Batch Query (TBQ) file to CMS (for more information see:  
https://www.cms.gov/Medicare-Medicaid-Coordination/Medicare-and-Medicaid-Coordination/Medicare-Medicaid-
Coordination-Office/Downloads/TBQData.pdf ) 
4 42 CFR part 431, subpart E and 42 CFR 435.917
  CMCS Informational Bulletin  Page 3 
 
 
Medicare-eligible individuals who remain eligible for Medicaid under the MSP or other non-
MAGI category will be automatically eligible for the Medicare Part D low income subsidy (LIS) 
to provide additional assistance with the cost of prescription drugs covered by Medicare.  
Medicare-eligible individuals who do not remain eligible for Medicaid may also qualify for the 
LIS, but a separate determination is needed.  State Medicaid agencies can make this 
determination, and early outreach to individuals losing eligibility under the Medicaid expansion 
group also enables states to determine eligibility for the LIS prior to the individual becoming 
Medicare eligible and losing eligibility for Medicaid. 
 
Simplifying the collection of information from beneficiaries:  States already provide beneficiaries 
multiple ways to provide information, including online, by mail, in person, and by phone, as 
appropriate.  However, these avenues are not always utilized to their full potential.  States may 
take additional steps to promote the availability of these options, e.g., by encouraging 
beneficiaries to upload required documents and forms online or provide necessary information 
by phone rather than in person.   
 
Providing adequate assistance:  Ensuring that sufficient assistance is available is also important 
to help beneficiaries complete the redetermination process and minimize coverage gaps.  We 
encourage states to work with providers, application assisters, managed care organizations, 
consumer groups and others within the state to provide assistance to beneficiaries to understand 
the redetermination process and provide any necessary information required.  
 
State Options to Align Eligibility Rules5  
 
Income and asset rules:  Multiple states have used the authority under section 1902(r)(2) of the 
Social Security Act (the Act), which permits states to apply less restrictive income and asset 
methodologies than those of the Supplemental Security Income (SSI) program, in determining 
eligibility for MSP or other eligibility groups.  By exercising this authority, states can facilitate 
alignment of the eligibility rules between MSP and Medicaid expansion group, which can ease 
the transition of beneficiaries from the expansion group to MSP when they become Medicare-
eligible.  A number of states also have used section 1902(r)(2) of the Act to provide MSP to a 
greater portion of Medicare-eligible individuals losing coverage under the Medicaid expansion 
group by disregarding certain amounts or types of income and assets of a beneficiary, his or her 
spouse or other family members in determining eligibility for coverage under MSP or other non-
MAGI eligibility groups.  CMS is available to provide technical assistance to any state interested 
in pursuing either of these uses of section 1902(r)(2) authority. 
   
Further Information 
 
Flexibility in existing law provides states with options to improve retention and streamline 
operations to better serve individuals in the adult group who are approaching Medicare 
eligibility.  For information about obtaining advance notice of upcoming Medicare eligibility, 
please contact MMCODataSharing@cms.hhs.gov.  Other changes to a states Medicaid 
eligibility rules may need to be effectuated through state plan amendments.  For questions and 
                                                 
5For additional options, see January 23, 2015 CIB, https://www.medicaid.gov/Federal-Policy-
Guidance/Downloads/CIB-01-23-2015.pdf   CMCS Informational Bulletin  Page 4 
 
 
more information about the options discussed in this Bulletin, please contact Stephanie 
Kaminsky at (410)786-4653 or Stephanie.kaminsky@cms.hhs.gov.