DEPARTMENT OF HEALTH AND HUMAN SERVICES 
Centers for Medicare & Medicaid Services 
7500 Security Boulevard, Mail Stop S2-26-12 
Baltimore, MD 21244-1850 
 
 
Medicaid Managed Care Marketing Regulations  
Frequently Asked Questions 
January 16, 2015 
 
Note:  The term Medicaid managed care plan refers to managed care organizations (MCOs), 
prepaid inpatient health plans (PIHPs), prepaid ambulatory health plans (PAHPs), and primary 
care case managers (PCCMs), as defined in 42 CFR 438.2. 
 
Q1.  Regulations at 42 CFR 438.104(b) (1) (IV) prohibit Medicaid managed care plans from 
seeking to influence enrollment in their plan in conjunction with the sale or offering of 
private insurance.   Does this prohibit a carrier that offers both a qualified health 
plan (QHP) and a Medicaid managed care plan from marketing both products? 
 
A1.  The regulation only prohibits insurance policies that would be sold in conjunction with 
enrollment in the Medicaid managed care plan.  Section 438.104 alone does not prohibit 
a Medicaid managed care plan from providing information about a Qualified Health 
Plans (QHP) to potential enrollees who could enroll in such a plan as an alternative to 
the Medicaid managed care plan due to a loss of Medicaid eligibility or to potential 
enrollees who may consider the benefits of selecting an Medicaid managed care plan 
that has a related QHP in the event of future eligibility changes.  However, Medicaid 
managed care plans should consult their contracts and the State Medicaid agency to 
ascertain if other provisions exist that may prohibit or limit such activity. 
 
Section 438.104(b)(1)(iv) implements a provision in section 1932(d)(2)(C) of the Social 
Security Act, titled Prohibition of Tie-Ins.  In promulgating regulations implementing 
this provision, CMS clarified that we interpreted it to preclude tying enrollment in the 
Medicaid managed care plan with purchasing (or the provision of) other types of private 
insurance.  We do not intend the statutory prohibition of tie-ins to apply to a discussion 
of a possible alternative to the Medicaid managed care plan, which a QHP could be if 
the consumer is determined to be not Medicaid eligible or loses Medicaid eligibility. 
 
Q2.  Do the terms of the contract between the State Medicaid agency and a Medicaid 
managed care plan apply to that organizations qualified health plan (QHP)? 
 
A2.  States are encouraged to review their managed care contracts to clearly identify the 
legal entity with which they are contracted for Medicaid coverage since federal 
Medicaid managed care regulations do not address this aspect of contracting.  If the 
party to the contract is an entity (such as a parent company) that has a contract with a 
state Medicaid agency to provide benefits as a Medicaid managed care plan and is also a 
QHP issuer, then some contractual provisions may apply to both.  Although the federal 
Medicaid regulations do not apply to a QHP issuer or QHP, state law, regulation, or   
 
contract language may have implications for the QHP issuer.  If changes are needed to 
narrow the scope of the contract to apply only to the Medicaid managed care plan, we 
encourage states to make those changes so as to ensure consistent understanding and 
application of the Medicaid contract terms. 
 
Q3.  If an individual who may already be enrolled in a Medicaid managed care plan, or is 
eligible to enroll in a Medicaid managed care plan, calls the plans customer service 
unit with questions about that plans Medicaid MCO and/or QHP products, can the 
Medicaid managed care plan answer consumer questions without violating the 
Medicaid marketing rules at 42 CFR 438.104? 
 
A3.  Yes.  Responding to direct questions from consumers is not generally a violation of 42 
CFR 438.104.  Proactive consumer inquiries to a health plan for information about 
coverage options, benefits, or provider networks is no different than a consumer 
obtaining information from the health plans website.  So long as the limits on marketing 
are satisfied and respected (e.g., the information is accurate and does not mislead, 
confuse or defraud beneficiaries or the state Medicaid agency), responding to direct 
questions from potential enrollees with accurate information is not prohibited. 
 
Q4.  May Medicaid managed care plans conduct outreach to their enrollees regarding the 
Medicaid eligibility renewal process? 
 
A4.  There is no provision in 42 CFR 438.104 specifically addressing a Medicaid managed care 
plans outreach to enrollees for eligibility purposes; therefore, it depends on the 
Medicaid managed care plans contract with the state Medicaid agency.  The federal 
regulation at 42 CFR 438.104 defines marketing as any communication, from an 
[Medicaid managed care plan] to a Medicaid beneficiary who is not enrolled in that 
entity, that can reasonably be interpreted as intended to influence the beneficiary to 
enroll in that particular [Medicaid managed care plans] Medicaid product, or either to 
not enroll in, or to disenroll from, another [Medicaid managed care plans] Medicaid 
product.  So long as information and outreach about the eligibility renewal process is 
neither directed to beneficiaries who are not enrolled with that Medicaid managed care 
plan, nor intended to influence the beneficiary to enroll in that particular Medicaid 
managed care planor to not enroll in, or disenroll from another Medicaid managed 
care planthe activity is not within the scope of 42 CFR 438.104.  Materials and 
information that purely educate an enrollee of that Medicaid managed care plan on the 
importance of completing the States Medicaid eligibility renewal process in a timely 
fashion would not meet the federal definition of marketing.  However, Medicaid 
managed care plans should consult their contracts and the state Medicaid agency to 
ascertain if other provisions exist that may prohibit or limit such activity. 
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