65230 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

1Caswell, Kyle J., and Timothy A. Waidmann, 

‘‘Medicare Savings Program Enrollees and Eligible 

Non-Enrollees,’’ The Urban Institute June 2017). 

https://www.macpac.gov/wp-content/uploads/ 

2017/08/MSP-Enrollees-and-Eligible-NonEnrollees.pdf. 2E.O. 13985, 86 FR 7009. https://

www.whitehouse.gov/briefing-room/presidentialactions/2021/01/20/executive-order-advancingracial-equity-and-support-for-underservedcommunities-through-the-federal-government/. 3E.O. 14009, 86 FR 7793. https://

www.whitehouse.gov/briefing-room/presidentialactions/2021/01/28/executive-order-onstrengthening-medicaid-and-the-affordable-careact/. 4E.O. 14058, 86 FR 71357. https://

www.whitehouse.gov/briefing-room/presidentialactions/2021/12/13/executive-order-ontransforming-federal-customer-experience-andservice-delivery-to-rebuild-trust-in-government/. 5E.O. 14070, 87 FR 20689. https://

www.whitehouse.gov/briefing-room/presidentialactions/2022/04/05/executive-order-on-continuingto-strengthen-americans-access-to-affordablequality-health-coverage/. 

6 In October 2020, CMS engaged with 55 

interested parties across four States to better 

understand experiences when applying for the 

MSPs. One of the main findings was that 

burdensome documentation requirements 

substantially impede eligible individuals from 

enrolling in the MSPs and that easing these 

requirements is a critical step to ensuring 

individuals can obtain and retain these critical 

benefits. 

7Under the Families First Coronavirus Response 

Act (FFCRA, Pub. L. 116–127), States did not 

terminate enrollment for most individuals who 

were enrolled in Medicaid as of or after March 18, 

2020, as a condition of receiving a temporary 

increase in the Federal Medical Assistance 

Percentage. The Consolidated Appropriations Act, 

2023 (CAA, 2023, Pub. L. 117–328), enacted on 

December 29, 2022, ended this Medicaid 

continuous enrollment condition on March 31, 

2023, enabling States to begin the process of 

initiating Medicaid eligibility reviews as early as 

February 1, 2023. 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Parts 406 and 435 

[CMS–2421–F] 

RIN 0938–AU00 

Streamlining Medicaid; Medicare 

Savings Program Eligibility 

Determination and Enrollment 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Final rule. 

SUMMARY: This final rule simplifies 

processes for eligible individuals to 

enroll and retain eligibility in the 

Medicare Savings Programs (MSPs). 

This final rule better aligns enrollment 

into the MSPs with requirements and 

processes for other public programs. 

Finally, this final rule reduces the 

complexity of applications and 

reenrollment for eligible individuals. 

DATES: These regulations are effective 

November 17, 2023. Throughout, 

however, we identify separate 

compliance dates that vary by provision, 

thereby giving States additional time to 

implement the provisions of this final 

rule. 

FOR FURTHER INFORMATION CONTACT: Kim 

Glaun, (410) 786–3849, kim.glaun@

cms.hhs.gov, or Melissa Heitt, (410) 

786–2484, melissa.heitt@cms.hhs.gov. 

SUPPLEMENTARY INFORMATION: This final 

rule addresses select provisions and 

public comments from the proposed 

rule, published in the September 7, 

2022 Federal Register (87 FR 54760). 

We intend to address the remaining 

provisions and public comments from 

the proposed rule in subsequent 

rulemaking. 

I. Background 

Millions of individuals with limited 

income and resources rely on the 

Medicare Savings Programs (MSPs) to 

help cover Medicare Parts A and B 

premiums and, often, cost-sharing. In 

accordance with section 1902(a)(10)(E) 

of the Social Security Act (the Act), 

MSPs are part of States’ Medicaid 

programs and assist individuals who 

need help paying their Medicare costs. 

The MSPs are essential to the health 

and well-being of those enrolled, 

promoting access to care and helping 

free up individuals’ limited income for 

food, housing, and other life necessities. 

Through the MSPs, Medicaid pays 

Medicare Part B premiums each month 

for over 10 million individuals and Part 

A premiums for over 700,000 

individuals. However, millions more are 

eligible but not enrolled. A 2017 study 

conducted for the Medicaid and CHIP 

Payment and Access Commission 

(MACPAC) estimated that only about 

half of eligible Medicare beneficiaries 

were enrolled in MSPs.1

The Biden-Harris Administration is 

committed to protecting and 

strengthening Medicaid. On January 20, 

2021, President Biden issued Executive 

Order 13985, charging Federal agencies 

with identifying potential barriers that 

underserved communities may face to 

enrollment in programs like Medicaid.2

This was followed on January 28, 2021 

by Executive Order 14009 with a 

specific call to strengthen Medicaid and 

the Affordable Care Act and remove 

barriers to obtaining coverage for the 

millions of individuals who are 

potentially eligible but remain 

uninsured.3 The December 13, 2021 

Executive Order 14058, ‘‘Transforming 

Federal Customer Experience and 

Service Delivery to Rebuild Trust in 

Government’’ supports streamlining 

State enrollment and renewal processes 

and removing barriers to ensure eligible 

individuals are automatically enrolled 

in and retain access to critical benefit 

programs.4 The April 5, 2022 Executive 

Order 14070, ‘‘Continuing to Strengthen 

Americans’ Access to Affordable, 

Quality Health Coverage’’ charges 

Federal agencies with identifying ways 

to help more Americans enroll in 

quality health coverage.5 It calls upon 

Federal agencies to examine policies 

and practices that make it easier for 

individuals to enroll in and retain 

coverage. In response to these Executive 

Orders, we examined ways to improve 

access to the MSPs. 

We have learned through our 

experiences in working with States and 

other interested parties that certain 

policies continue to result in 

unnecessary administrative burden and 

create barriers to enrollment and 

retention of coverage for eligible 

individuals. For example, there are no 

regulations to facilitate enrollment in 

the MSPs. In particular, we do not have 

regulations to link enrollment in other 

Federal programs with the MSPs, 

despite the high likelihood that 

individuals in such programs are 

eligible for the MSPs. This hinders 

States’ ability to efficiently enroll those 

known to be eligible. Additionally, 

interested parties report that 

burdensome documentation 

requirements substantially impede 

eligible individuals from enrolling in 

the MSPs.6

In this rulemaking, we finalize 

policies to streamline MSP eligibility 

and enrollment processes, reduce 

administrative burden on States and 

applicants, and increase enrollment and 

retention of eligible individuals. 

Current regulations at 42 CFR 433.112 

establish conditions that State eligibility 

and enrollment systems must meet to 

qualify for enhanced Federal matching 

funds. Among these conditions, 

§ 433.112(b)(14) requires that each State 

system support accurate and timely 

processing and adjudications/eligibility 

determinations. As States submit 

proposed changes to their eligibility and 

enrollment systems and implement new 

and/or enhanced functionality, we will 

continue to provide them with technical 

assistance on the policy requirements, 

conduct ongoing reviews of both the 

State policy and State systems, and 

ensure that all proposed changes 

support more accurate and timely 

processing of eligibility determinations. 

We recognize that the COVID–19 

pandemic disrupted routine eligibility 

and enrollment operations for 

Medicaid.7 As States have resumed 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65231 

8 Dusetzina, S. et al., ‘‘Many Medicare 

Beneficiaries Do Not Fill High-Price Specialty Drug 

Prescriptions,’’ Health Affairs. 41: no. 4 (April 

2022): 487–496. https://www.healthaffairs.org/doi/ 

epdf/10.1377/hlthaff.2021.01742. 

9Hoffman, Catherine, and Julia Paradise, ‘‘Health 

Insurance and Access to Health Care in the United 

States,’’ Ann. N.Y. Acad. Sci. 1136 (2008): 149–160. 

https://nyaspubs.onlinelibrary.wiley.com/doi/ 

pdfdirect/10.1196/annals.1425.007. 

10There is a separate and fourth MSP eligibility 

group generally referred to as the ‘‘Qualified 

Disabled Working Individuals (QDWI) group,’’ or 

QDWI group. As described in section 

1902(a)(10)(E)(ii) of the Act, eligibility in the QDWI 

group is limited to individuals whose incomes do 

not exceed 200 percent of the FPL; whose resources 

do not exceed twice the relevant SSI resource 

standard (that is, for a single individual or couple); 

and who are eligible to enroll in Part A under 

section 1818A of the Act. Section 1818A of the Act 

permits individuals who became entitled to Part A 

on the basis of their receipt of Social Security 

disability insurance (SSDI) and who subsequently 

lose SSDI after returning to work (and, hence, 

entitlement to Part A) to enroll in Part A contingent 

on paying the Part A premiums. The medical 

assistance available to QDWIs is the coverage of the 

Part A premiums. The QDWI group is not included 

in this proposal, because the income limits of the 

QDWI group are significantly higher than LIS and 

there does not exist the flexibility to disregard 

resources that are available for the other MSPs. 

11Unlike a subset of individuals enrolled in the 

QMB and SLMB groups, no individuals enrolled in 

the QI group are eligible for other Medicaid 

program benefits. 

12Caswell, Kyle J., and Timothy A. Waidmann, 

‘‘Medicare Savings Program Enrollees and Eligible 

Non-Enrollees,’’ The Urban Institute, June 2017. 

https://www.macpac.gov/wp-content/uploads/ 

Continued 

routine operations (a process we refer to 

as ‘‘unwinding’’) they are faced with the 

challenge of re-assessing eligibility for a 

significantly larger number of enrollees 

than ever before. From February 2020 

through March 2023, enrollment in 

Medicaid increased by 35.3 percent, or 

over 22 million individuals. Enrollment 

in Medicaid has increased in every State 

during that period. At the same time, 

many States report a shortage of 

eligibility workers. It is our priority to 

ensure that renewals of eligibility and 

transitions between coverage programs 

occur in an orderly process that 

minimizes beneficiary burden and 

promotes continuity of coverage and 

care. 

As we considered the challenges 

faced by States, we sought comment on 

reasonable implementation timelines for 

the provisions in our proposed rule, 

which would allow States to implement 

these important policies without 

negatively impacting the resumption of 

routine eligibility and enrollment 

operations. Certain provisions designed 

to improve the retention of eligible 

individuals could reduce the likelihood 

of eligible individuals losing health 

coverage during unwinding. However, 

we were also concerned that the work 

necessary to immediately implement 

such provisions would divert needed 

resources away from critical unwindingrelated activities. 

Recognizing that each State faces a 

unique set of challenges related to 

unwinding, with differing needs and 

opportunities, we sought comment on 

whether an effective date of 30 days 

following publication would be 

appropriate when combined with a later 

date for compliance for most provisions. 

We also sought comment on the 

timeframe that would be most effective 

for compliance with each provision and 

whether the compliance date should 

vary by provision. 

In this final rule, we establish 

compliance dates that allow time for 

States to fully comply with new 

requirements while balancing other 

immediate priorities. Many of the 

provisions have compliance dates of 

April 1, 2026, one has a compliance 

date of October 1, 2024, and provisions 

that create State options generally take 

effect on the effective date of this final 

rule. We encourage States to comply 

with all new requirements as 

expeditiously as possible because they 

will improve access to MSPs for eligible 

new applicants and improve retention 

of eligible individuals who are already 

enrolled in an MSP, while reducing 

administrative burden on States and 

individuals. 

Finally, implementation of this final 

rule will complement other new 

policies to improve access to coverage 

and affordability of prescription drugs. 

Beginning January 1, 2024, section 

11404 of the Inflation Reduction Act 

expands eligibility for the full Medicare 

Part D Low-Income Subsidy benefit. To 

the extent that this change increases the 

number of people who apply for the 

Low-Income Subsidy and are otherwise 

eligible for (but not yet enrolled in) the 

MSPs, provisions in this final rule will 

facilitate access to the MSPs while 

reducing administrative burdens. And 

to the extent this final rule improves 

access to the MSPs, it will also 

automatically improve access to the 

Low-Income Subsidy, as we describe 

later in this final rule. Based on the 

evidence that Medicare prescription 

drug subsidies improve access to 

treatment 8 and overall access to health 

insurance improves health outcomes,9

our proposals are likely to improve the 

health of older adults and people with 

disabilities. 

II. Provisions of the Proposed Rule and

Analysis of and Response to Public

Comments

A. Facilitating Medicaid Enrollment

1. Facilitate Enrollment Through

Medicare Part D Low-Income Subsidy

‘‘Leads’’ Data (42 CFR 435.4, 435.601,

435.911, and 435.952)

Medicare Savings Programs and Part 

D Low- Income Subsidy Background. 

Under mandatory eligibility groups that 

are collectively referred to as MSPs, 

individuals with limited income and 

resources qualify for Medicaid coverage 

of Medicare Part A and/or B premiums 

and, often, cost-sharing. State Medicaid 

agencies receive applications and 

adjudicate eligibility for full Medicaid 

and MSP coverage. Currently, the MSP 

eligibility groups cover over 10 million 

low-income individuals. There are three 

primary MSP eligibility groups: 10 the 

Qualified Medicare Beneficiary (QMB) 

group, through which Medicaid pays all 

of an individual’s Medicare Parts A and 

B premiums and assumes liability for 

most associated Medicare cost-sharing 

charges for people with income that 

does not exceed 100 percent of the FPL; 

the Specified Low-Income Medicare 

Beneficiary (SLMB) group, through 

which Medicaid pays the Part B 

premium for people with income that 

exceeds 100 percent, but is less than 120 

percent, of the FPL; and the Qualifying 

Individuals (QI) group, through which 

Medicaid pays Part B premiums for 

people with income of at least 120 

percent but less than 135 percent of the 

FPL.11 Individuals also must meet 

corresponding resource criteria to be 

eligible for an MSP. The income and 

resource requirements for coverage 

under the MSPs, and the benefits to 

which eligible individuals are entitled, 

are set forth at sections 1905(p)(1) and 

1902(a)(10)(E) of the Act. Among other 

things, section 1905(p) of the Act directs 

that the income and resource 

methodologies applied by the Social 

Security Administration (SSA) in 

determining supplemental security 

income (SSI) eligibility per sections 

1612 and 1613 of the Act be used to 

determine financial eligibility for the 

MSPs, except that States may employ 

less restrictive income and/or resource 

methodologies than those applied in 

determining SSI eligibility under the 

authority of section 1902(r)(2) of the 

Act. 

As discussed in the proposed rule at 

87 FR 54763, the MSPs are essential to 

the health and economic well-being of 

low-income Medicare enrollees, helping 

to free up limited income for food, 

housing, and other life necessities. 

Despite the importance of the MSPs, a 

2017 study conducted for MACPAC 

estimated that only about half of eligible 

individuals enrolled in Medicare were 

also enrolled in the MSPs.12 This means 


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2017/08/MSP-Enrollees-and-Eligible-NonEnrollees.pdf. 

13Office of the Assistant Secretary for Planning 

and Evaluation, ‘‘Loss of Medicare-Medicaid Dual 

Eligible Status: Frequency, Contributing Factors, 

and Implications,’’ May 8, 2019. https:// 

aspe.hhs.gov/basic-report/loss-medicare-medicaiddual-eligible-status-frequency-contributing-factorsand-implications. 

14 Government Accountability Office, ‘‘Medicare 

Savings Programs: Implementation of Requirements 

Aimed at Increasing Enrollment,’’ September 2012. 

https://www.gao.gov/assets/gao-12-871.pdf. 

15https://www.whitehouse.gov/briefing-room/ 

presidential-actions/2021/01/28/executive-orderon-strengthening-medicaid-and-the-affordable-careact/. 

16https://www.whitehouse.gov/briefing-room/ 

presidential-actions/2022/04/05/executive-orderon-continuing-to-strengthen-americans-access-toaffordable-quality-health-coverage/. 

17https://www.whitehouse.gov/briefing-room/ 

presidential-actions/2021/12/13/executive-orderon-transforming-federal-customer-experience-andservice-delivery-to-rebuild-trust-in-government/. 

18https://www.whitehouse.gov/briefing-room/ 

presidential-actions/2021/01/20/executive-orderadvancing-racial-equity-and-support-forunderserved-communities-through-the-federalgovernment/. 

19See February 18, 2010 State Medicaid Director 

Letter (SMDL #10–003), ‘‘Medicare Improvements 

for Patients and Providers Act of 2008 (MIPPA),’’ 

explaining how to treat leads data as an application 

for MSPs. https://www.medicaid.gov/federal-policyguidance/downloads/smd10003.pdf. We reiterated 

this 2010 guidance in 2020 in Chapter 1, section 

1.6.2 of the Manual for the State Payment of 

Medicare Premiums, https://www.cms.gov/files/ 

document/chapter-1-program-overview-andpolicy.pdf, and in the November 1, 2021 Center for 

Medicaid and CHIP Services Informational Bulletin, 

‘‘Opportunities to Increase Enrollment in Medicare 

Savings Programs.’’ https://www.medicaid.gov/ 

federal-policy-guidance/downloads/ 

cib11012021.pdf. 

that millions of Medicare enrollees 

living in poverty are paying over 10 

percent of their income to cover 

Medicare premiums alone, despite being 

eligible for Medicaid coverage for these 

costs. Complex MSP enrollment 

processes contribute to this low 

participation rate.13 14

The Medicare Improvements for 

Patients and Providers Act of 2008 

(MIPPA) (Pub. L. 110–275, enacted July 

15, 2008), aimed to improve low-income 

benefit programs for Medicare 

beneficiaries. MIPPA included new 

requirements for States to streamline 

enrollment of Medicare Part D LowIncome Subsidy (LIS) program enrollees 

into the MSPs. This final rule codifies 

provisions from MIPPA and builds upon 

its requirements to further streamline 

MSP enrollment for LIS enrollees and 

address persistent under enrollment in 

the MSPs. 

The Medicare Part D LIS program, 

also sometimes referred to as ‘‘Extra 

Help,’’ is administered by SSA and pays 

Medicare Part D prescription drug 

premiums and cost-sharing for over 13 

million individuals with low incomes. 

Most LIS enrollees are deemed eligible 

for LIS by virtue of their enrollment in 

Medicaid. Others apply for the benefit 

by completing an application and 

submitting it to SSA. Once received, 

SSA uses the information provided on 

the LIS application to determine LIS 

eligibility. Section 1860D–14(a)(3)(C) of 

the Act directs that the income 

methodologies for LIS are the MSP 

income methodologies described in 

section 1905(p)(1)(B) of the Act (that is, 

with very narrow exceptions, the SSI 

income methodologies). Similarly, 

section 1860D–14(a)(3)(D) and (E) of the 

Act direct that the resource 

methodologies for LIS are the MSP 

resource methodologies described in 

section 1905(p)(1)(C) of the Act, which 

are also generally aligned with the SSI 

resource methodologies, except that the 

cash value of life insurance, which is 

typically countable under SSI resource 

methodologies, is not counted as a 

resource for LIS. The SSA has also 

adopted a few additional regulatory and 

sub-regulatory methodological 

simplifications for the LIS program that 

differ from SSI rules, as explained later 

in this section of the final rule. 

The MSP and LIS programs both 

assist low-income individuals in 

accessing the Medicare benefits to 

which they are entitled and, as 

described previously in this final rule, 

generally use a common methodology to 

determine income and resource 

eligibility. Current regulations at 42 CFR 

423.773(c) require that individuals 

enrolled in MSPs be automatically 

enrolled in LIS. However, individuals 

who are enrolled in LIS are not 

automatically enrolled in MSPs. Many 

people enrolled in the LIS program are 

not enrolled in an MSP, despite likely 

being eligible. As discussed in the 

proposed rule at 87 FR 54764, MIPPA 

included several provisions to promote 

the enrollment of LIS applicants into the 

MSPs. 

In particular, section 113 of MIPPA 

requires SSA to transmit data from LIS 

applications (‘‘leads data’’) to State 

Medicaid agencies, and that the 

electronic transmission from SSA ‘‘shall 

initiate’’ an MSP application. MIPPA 

also requires States to accept leads data 

and ‘‘act upon such data in the same 

manner and in accordance with the 

same deadlines as if the data 

constituted’’ an MSP application 

submitted by the individual. As 

outlined under § 435.912, States have 45 

days to make an MSP eligibility 

determination based on the LIS data. 

The date of the MSP application is 

defined as the date of the individual’s 

application for LIS under section 

1935(a) of the Act. 

Despite these statutory requirements, 

not all States initiate an MSP 

application upon receipt of leads data 

from SSA. Based on program experience 

and comments submitted on the 

proposed rule, some States have been 

unaware or unclear of the steps required 

to meaningfully use the leads data to 

streamline eligibility and enrollment in 

the MSPs. Our data reflects that 

currently over a million individuals 

enrolled in full LIS are not enrolled in 

an MSP. Given near alignment of MSP 

and full LIS eligibility criteria, most of 

these individuals are likely eligible for 

an MSP eligibility group. 

The January 28, 2021 Executive Order 

on Strengthening Medicaid and the 

Affordable Care Act directs agencies to 

address policies and practices that may 

present unnecessary barriers to 

individuals and families attempting to 

access Medicaid coverage,15 the April 5, 

2022 Executive Order on Continuing to 

Strengthen Americans’ Access to 

Affordable, Quality Health Coverage 

charges Federal agencies with 

identifying ways to help more 

Americans enroll in quality health 

coverage,16 and the December 13, 2021 

Executive Order on Transforming 

Federal Customer Experience and 

Service Delivery to Rebuild Trust in 

Government supports streamlining State 

enrollment and renewal processes and 

removing barriers to ensure eligible 

individuals are automatically enrolled 

in and retain access to critical benefit 

programs.17 As such, we have evaluated 

CMS’s regulatory authority to reduce 

barriers to enrollment of eligible 

individuals into the MSPs. Under the 

authority in section 1902(a)(4) of the Act 

to specify ‘‘methods of administration’’ 

that the Secretary finds to be ‘‘necessary 

for the proper administration’’ of State 

plans, we proposed several regulatory 

changes to promote efficient enrollment 

in the MSPs by maximizing States’ use 

of LIS leads data. At 87 FR 54764, we 

explained that we anticipated these 

proposals would also have a positive 

impact on health equity by helping to 

provide more low-income individuals 

with access to additional health 

coverage consistent with the January 20, 

2021 Executive Order.18

Accepting LIS leads data as an MSP 

application. As discussed in the 

proposed rule at 87 FR 54764, SSA must 

transmit the LIS leads data to States, 

and States must use that data to initiate 

an application for the MSPs. CMS has 

reinforced this requirement multiple 

times.19

We proposed to codify in regulation 

the statutory requirements for States to 


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20Under § 435.952(c)(1), income information 

obtained through an electronic data match shall be 

considered ‘‘reasonably compatible’’ with income 

information provided by or on behalf of an 

individual if both are either above or at or below 

the applicable income standard or other relevant 

income thresholds. 

maximize the use of leads data to 

establish eligibility for Medicaid and the 

MSPs. At 87 FR 54765, we foresaw that 

codifying these requirements would 

lead to more eligible individuals 

enrolling in MSPs because it was our 

understanding that some States may 

have been unaware or unclear of the 

steps required to meaningfully use the 

leads data to streamline eligibility and 

enrollment in the MSPs. 

Currently, all States receive leads data 

from SSA each business day. Per section 

113 of MIPPA, States must accept, via 

secure electronic transfer, the SSA leads 

data and process that information to 

initiate an MSP application. However, 

as discussed at 87 FR 54765, we are 

aware that several States do not use the 

leads data to begin the application 

process. We proposed to add a 

definition of LIS leads data at § 435.4 

and a new paragraph (e) to § 435.911 of 

the regulations to clearly delineate the 

steps States must take upon receipt of 

leads data from SSA. We proposed to 

define LIS leads data to mean data from 

an individual’s application for lowincome subsidies under section 1860D– 

14 of the Act that the SSA electronically 

transmits to the appropriate State 

Medicaid agency as described in section 

1144(c)(1) of the Act. We proposed at 

§ 435.911(e)(1) to require States to 

accept, via secure electronic interface, 

the SSA LIS leads data. We proposed 

paragraph (e)(2) to require that States 

treat receipt of the leads data as an 

application for Medicaid and promptly 

and without undue delay, consistent 

with the timeliness standards at 

§ 435.912, determine MSP eligibility 

without requiring submission of a 

separate application. 

We proposed paragraph (e)(4) to 

prevent States from requesting that 

individuals attest or otherwise provide 

documentation to establish information 

contained in leads data, which SSA has 

already used for the LIS eligibility 

determination. We noted that a State is 

not in compliance with the statutory 

requirement in section 1935(a)(4) of the 

Act to initiate an application based on 

leads data or with the proposed 

regulation if it requires the individual to 

file a new application for MSP, since the 

leads data already provides much of the 

information that would otherwise be 

requested on an application. 

Further, because the LIS leads data 

that is transferred to State agencies has 

just been used by the SSA for the LIS 

determination, State verification of this 

data prior to adjudicating eligibility is 

duplicative and inefficient. As such, 

under the Secretary’s authority under 

section 1902(a)(4) of the Act (relating to 

establishment of such methods of 

administration as the Secretary 

determines ‘‘necessary for proper and 

efficient administration’’ of the 

Medicaid program) and section 

1902(a)(19) of the Act (relating to 

simplicity of administration and the 

best interests of recipients), we 

proposed at § 435.911(e)(5) that States 

be required to accept information that is 

provided through the leads data without 

further verification, with certain 

exceptions, as described below. 

However, at 87 FR 54765, we 

recognized that State Medicaid agencies 

generally will need to obtain additional 

information beyond what is provided by 

the SSA that is necessary to determine 

eligibility, as some differences remain in 

income and resource counting 

methodologies between the LIS and 

MSPs, as described in more detail in the 

proposed rule. In addition, as discussed 

at 87 FR 54765 through 54766, the leads 

data transmitted to the State does not 

include information on an individual’s 

citizenship or immigration status, and 

therefore, States will need to verify their 

status. In accordance with § 435.406(a) 

and section 1137(d) of the Act, 

individuals must make a declaration of 

U.S. citizenship or satisfactory 

immigration status (subject to certain 

verification rules at §§ 435.956 and 

435.407 and exemptions for Medicare 

beneficiaries at § 435.406(a)(1)(iii)(B)). 

As such, we proposed at paragraph 

(e)(3) of § 435.911 that States must 

obtain additional information needed to 

make a determination of eligibility for 

MSPs. We also recommended that when 

States request additional information 

from individuals, they include 

information on how to contact the local 

State Health Insurance Assistance 

Program (SHIP) for assistance. 

Consistent with existing regulations at 

§§ 435.907(e) and 435.952(c), we 

proposed at paragraph (e)(4) of 

§ 435.911 that States may not request 

that individuals attest or otherwise 

provide documentation to establish 

information that SSA has already used 

for the LIS eligibility determination. 

Therefore, in instances in which the 

leads data would not support a 

determination of eligibility for MSPs, 

we proposed at § 435.911(e)(7) to 

require that States use the information 

provided by the applicant to SSA 

through the LIS application process and 

separately verify the individual’s 

eligibility for Medicaid in accordance 

with the State’s verification policies. 

Specifically, under proposed 

§ 435.911(e)(7), the State would be 

required to: (1) determine whether 

additional information is needed to 

make a determination of eligibility for 

an MSP; (2) if additional information is 

needed, notify the individual that they 

may be eligible for assistance with their 

Medicare premium and/or cost-sharing 

charges, but that additional information 

is needed for the agency to make a 

determination of such eligibility; (3) 

provide the individual with a minimum 

of 30 days to furnish any information 

needed by the agency to determine MSP 

eligibility; and (4) verify the 

individual’s eligibility for an MSP in 

accordance with the State’s verification 

plan developed in accordance with 

§ 435.945(j). We noted that, in the case 

of an applicant who has attested to 

income or assets over the applicable 

income or resource standard, States 

could, but would not be required to, 

request additional information from the 

individual to confirm ineligibility for 

coverage. 

Under our proposal, States would 

continue to be permitted to request from 

the individual information that is 

necessary to make an MSP eligibility 

determination if such information is 

missing from the leads data and cannot 

be obtained from other third-party 

sources consistent with current 

regulations, and as clarified in our 

proposed revisions to § 435.952(c). 

Similarly, States may not reach out to 

individuals to request information 

already provided through leads data 

unless the State has current and reliable 

information that is not reasonably 

compatible 20 with the leads data. We 

anticipate such circumstances with 

respect to financial eligibility would be 

rare since SSA has already used the 

leads data for the LIS determination just 

prior to State use, employing many of 

the same sources for financial eligibility 

data relied upon by States. 

Finally, individuals eligible for the 

LIS program may be eligible for full 

Medicaid benefits, in addition to the 

assistance with Medicare premiums and 

cost-sharing available under the MSPs. 

Under the current regulations at 

§ 435.911, for individuals who submit 

the single streamlined application for 

Medicaid on the basis of MAGI, but who 

may be eligible on a basis other than 

MAGI, States are required to collect any 

additional information that is needed to 

make a determination on a non-MAGI 

basis, and to make such determination 

if the individual provides the needed 

information. Consistent with sections 

1902(a)(4) and (a)(19) of the Act, we 

proposed a similar requirement with 


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65234 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

21See LIS record. https://www.ssa.gov/ 

dataexchange/documents/LIS%20record.pdf. 

respect to individuals whose 

applications were initiated by receipt of 

LIS leads data. Specifically, we 

proposed new regulatory text at 

§ 435.911(e)(6) to require States to 

obtain such additional information as 

may be needed to determine whether 

individuals whose MSP applications 

were initiated based on receipt of LIS 

leads data are eligible for Medicaid in 

any other eligibility groups (that is, 

other than the MSPs), including other 

non-MAGI groups and MAGI-based 

groups as well. This proposal aimed to 

codify a pathway for efficient 

enrollment of LIS enrollees into both the 

appropriate MSP eligibility group, as 

well as into a full-benefit group if 

eligible without imposing undue 

administrative burdens on States. We 

anticipated this would also promote 

program integrity by ensuring 

enrollment in the appropriate eligibility 

group. We noted that individuals can be 

eligible for both an MSP and an 

eligibility group that confers full 

Medicaid benefits. Therefore, the 

requirement under proposed 

§ 435.911(e)(6) was in addition to the 

requirement to determine the 

individual’s eligibility for an MSP. 

We received many comments on our 

proposals to streamline MSP 

determinations using LIS leads data, 

and our responses follow. 

Comment: Many commenters 

applauded CMS efforts to streamline 

MSP determinations using LIS leads 

data with this new rule. They noted that 

large numbers of eligible older adults 

and individuals with disabilities are 

missing out on the vital financial and 

health benefits the MSPs provide and 

cited burdensome paperwork 

requirements as a key driver of 

persistent under-enrollment in these 

programs for individuals who are 

eligible for them. They pointed out that, 

since 2010, Federal statute (MIPPA) has 

required States to leverage leads data to 

facilitate MSP enrollment for 

individuals enrolled in the LIS program, 

and asserted that CMS’s proposal to 

codify and build upon these 

requirements is needed to ensure States 

fully leverage leads data for MSP 

determinations and to promote greater 

uniformity among States in application 

processes and MSP participation rates 

for individuals enrolled in LIS. 

MACPAC generally supported these 

provisions, noting that they would 

promote MSP enrollment by simplifying 

eligibility and enrollment processes and 

would improve health equity by 

increasing access to care for additional 

low-income individuals with Medicare. 

Response: We thank the commenters 

for their support. As we stated above, 

the MSPs are essential to the health and 

economic well-being of those enrolled, 

promoting access to care and helping 

free up individuals’ limited income for 

food, housing, and other life necessities. 

We remain committed to increasing 

participation in these vital programs 

and foresee that simplifying enrollment 

processes would help hundreds of 

thousands of eligible individuals access 

these critical benefits. 

Comment: Some commenters 

expressed concerns that proposals at 

new § 435.911(e) to facilitate MSP 

enrollment through leads data would be 

burdensome and costly for States. For 

example, while MACPAC generally 

supported these provisions, it noted that 

they would likely increase costs to 

States and add to their administrative 

burden. Other commenters relayed 

concerns with the quality and adequacy 

of the leads data which they asserted 

would require additional manual work 

and system upgrades for States. For that 

reason, the commenters requested that 

CMS work with SSA to improve leads 

data before adopting this proposal. For 

example, some commenters maintained 

that because leads data lacks all 

information necessary for MSP 

determinations, States must follow up to 

obtain missing information. In addition, 

a commenter incorrectly contended that 

leads income and resource data is 

unusable because the commenter 

believed that information appears as a 

lump sum total, without a breakdown of 

sources and amounts. A few 

commenters noted that leads data omits 

citizenship and immigration status 

information and requested that CMS 

and SSA explore adding it in the future. 

Response: We appreciate the 

commenters’ perspectives and 

acknowledge that complying with our 

proposals to streamline MSP enrollment 

for LIS recipients could require some 

States to update their policy, operations, 

and/or systems—although we project 

reductions in administrative costs over 

the long term. We also recognize that 

increases in MSP enrollment as a result 

of our proposal could raise costs for 

States. However, Federal statute 

(MIPPA) has required States to use leads 

data to initiate an MSP application since 

January 1, 2010. Further, as we detailed 

in the proposed rule at 87 FR 54765, 

misalignments between the LIS and 

MSP programs may mean that leads data 

omits certain data needed to determine 

MSP eligibility. However, under 

§ 435.911(c)(2), States are already 

required to obtain additional 

information for applicants, including 

LIS applicants whose data has been 

transferred to the State through the 

leads data, when current information is 

insufficient to make a Medicaid 

eligibility determination. 

With respect to the commenter’s 

contention that LIS leads data only 

contains undifferentiated total amounts 

of the individual’s income and 

resources, this is incorrect. We clarify 

that an individual’s leads data record 

includes a breakdown of income and 

resources, by source and amounts.21 In 

response to commenters’ questions 

about expanding leads data to include 

citizenship information, we plan to 

explore with SSA the feasibility of 

adding this information in the future, as 

we foresee it could streamline processes 

for citizenship-related eligibility under 

§ 435.406 and reduce burden on States 

and individuals. With respect to the 

request to add immigration status 

information to the leads data, we plan 

to analyze further the feasibility and 

benefits of such an expansion to 

streamline eligibility determinations 

before exploring this step with SSA. In 

addition, as we reiterate in response to 

other comments below, if the State 

already has previously verified this 

information and it is included in the 

case record for the individual, the State 

must not request this information from 

the individual again in accordance with 

§ 435.956(a)(4)(ii). 

Overall, States’ comments revealed 

States’ lack of familiarity with the leads 

data. We also acknowledge that States 

are engaged in unwinding from the 

Medicaid continuous enrollment 

condition, and our proposal adds some 

new requirements for States, despite the 

longstanding MIPPA requirements. 

Therefore, we will provide States more 

time to comply with these provisions 

after this final rule’s effective date, as 

explained below. Prior to the 

compliance date, we plan to focus on 

providing technical assistance and 

guidance to States to assist them in 

achieving full compliance with these 

provisions. 

Comment: While supportive of this 

codification, a number of commenters 

urged CMS to pursue concerted 

monitoring and oversight of States’ 

compliance with their obligations under 

MIPPA. These commenters reported 

widespread partial or full noncompliance with leads data 

requirements by States, including 

examples of States that lack the system 

capacity to leverage leads data and 

States that automatically send 

individuals identified through LIS leads 

data an MSP application or instructions 

on how to complete the process. 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65235 

22https://www.medicaid.gov/federal-policyguidance/downloads/smd10003.pdf. 

Response: We appreciate the 

commenters’ support for codifying in 

regulation the MIPPA requirements for 

how States must use LIS leads data for 

determining MSP eligibility and agree 

with their likely benefits, including 

clarity and accountability for States. We 

also agree with the commenters on the 

importance of effective oversight and 

monitoring. We intend to implement a 

robust oversight and monitoring 

approach, and we are currently 

exploring options on how best to ensure 

the LIS leads data provisions are 

effectively implemented. 

Comment: A commenter maintained 

that codifying MIPPA is unnecessary, 

stating that States currently use LIS 

leads data as required. Some 

commenters also noted that these 

proposals were already required by 

MIPPA. 

Response: We appreciate the 

commenters’ input but disagree that 

codifying the MIPPA requirements is 

unnecessary. As described in the 

proposed rule (87 FR 54764) and 

reiterated by commenters and noted 

previously in this final rule, many 

States have only partially implemented 

these requirements, and some have yet 

to meaningfully do so at all. We believe 

that codifying the requirements for 

States will clarify State responsibilities 

under MIPPA and lead to more States 

using leads data as required. However, 

while we are codifying provisions 

already required by law, we disagree 

that all of our proposals are already 

required by MIPPA. For example, in our 

2010 guidance on implementing MIPPA, 

State Medicaid Director Letter, #10–003, 

‘‘Medicare Improvements for Patients 

and Providers Act of 2008’’ (the 2010 

MIPPA SMDL),22 we advised that States 

are permitted to treat leads as verified 

for the purposes of MSP determinations. 

Under our proposal, we would newly 

require States to accept leads data 

without further verification unless the 

State has other information that is not 

reasonably compatible with the leads 

data. 

Comment: Several commenters 

supported proposals in § 435.911(e)(4) 

on accepting leads data as verified if it 

supports an MSP eligibility 

determination and § 435.911(e)(5) on 

refraining from requesting data already 

in leads data. Commenters noted that 

these proposals reduce duplication, 

reduce barriers to enrollment, and 

streamline the MSP determination 

process. A commenter stated that 

requiring States to treat leads data as 

verified would boost the share of 

individuals enrolled in LIS who would 

also get enrolled into MSPs. 

Response: We thank the commenters 

for their support about accepting leads 

data as verified and agree that these 

provisions reduce duplication and 

barriers to enrollment. 

Comment: A few commenters noted 

their opposition to our proposal to 

require States to accept leads data as 

verified without requesting further 

information from the individual or 

separate verification by the State. A 

commenter expressed program integrity 

concerns, asserting that LIS data is less 

reliable than other State sources of 

information. Another commenter 

explained that its State verification 

procedures require individuals to 

produce documentation when State 

information sources differ from the 

information the applicant has supplied. 

The commenter noted that these 

requirements are stricter than SSA’s LIS 

program procedures which allow SSA to 

accept an individual’s verbal 

explanation of a discrepancy between 

income and resources if it is reasonable. 

A commenter said that CMS’s proposal 

is inconsistent, forcing States to accept 

leads data as verified if it supports an 

MSP eligibility determination, but not 

allowing States to accept leads data as 

verified if it does not support an MSP 

eligibility determination. 

Response: As noted in the proposed 

rule at 87 FR 54765, we maintain that 

accepting leads data as verified and not 

allowing States to request that the 

applicant provide information already 

sent to the State by SSA limits 

duplication and streamlines the MSP 

determination process. Additionally, we 

disagree with the commenters’ assertion 

that the LIS information is inherently 

less reliable than other State sources of 

information. As we noted in the 

proposed rule at 87 FR 54766, States 

and SSA are pulling electronic data 

from many of the same sources of 

information. Additionally, as explained 

previously in this final rule, if States 

have other information not reasonably 

compatible with leads data, they must 

request additional information from the 

individual before enrollment. 

With respect to the commenter’s 

concerns about the differing 

requirements when leads data would 

lead to a denial, we stated in the 

proposed rule (87 FR 54765) that 

applying a different verification policy 

to the use of LIS leads data that supports 

an MSP eligibility determination versus 

the use of leads data that would result 

in an MSP denial is in keeping with 

provisions of the Computer Matching 

and Privacy Protection Act (CMPPA, 

Pub. L. 100–503) at 5 U.S.C. 522a(p)(1). 

The CMPPA requires States to take 

actions to independently verify 

information that SSA provides before 

the State may terminate, suspend, 

reduce, deny, or take other adverse 

action against an individual. 

Comment: A few commenters 

provided input about the processing of 

MSP applications under proposed 

§ 435.911(e). A commenter asserted the 

proposal requires States to process MSP 

applications 45 days from the date SSA 

receives the LIS application and 

requested a longer period to align its LIS 

and MSP processes to comply. A few 

commenters questioned what State 

action is appropriate (for example, a 

denial of eligibility) if an individual 

does not return information requested 

by the State that is absent from the leads 

data and needed to determine eligibility 

for the MSPs. 

Response: As we discussed in the 

2010 MIPPA SMDL, States must treat 

the date the LIS application is filed with 

SSA as the date of application for 

purposes of establishing the effective 

date of eligibility for MSP benefits. 

However, States have flexibility 

regarding the calculation of the 45-day 

processing timeline under 

§ 435.912(c)(3). States may either use 

the date that the State receives the LIS 

leads data from SSA or the date of the 

LIS application as the start of the 

calculation of the 45-day processing 

timeline under § 435.912(c)(3). This 

policy allows additional time to make 

this MSP determination based on the 

LIS leads data, while ensuring MSP 

coverage is not delayed for eligible 

individuals. Additionally, we clarify 

that for MSP applications based on 

leads data, if an individual fails to 

comply with a request for information 

within the requisite time, a State would 

issue a notice of denial consistent with 

42 CFR 431.210 and 435.917(b). 

Comment: Some commenters 

submitted suggestions regarding the 

proposed new § 435.911(e)(3) that 

requires States to request additional 

information that is necessary for the 

MSP determination. Commenters 

suggested that CMS require States to 

collect additional relevant information 

through a pre-populated form that 

contains LIS leads data. These 

commenters maintained that 

individuals may be more likely to 

understand and timely respond to a 

prepopulated form. Further, a 

commenter stated that while States 

would generally need to obtain 

citizenship/immigration status, which is 

not in leads data, it is likely that many 

LIS applicants have been enrolled in 

Medicaid in the past. The commenter 

recommended that CMS re-emphasize 


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65236 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

23See final rule titled ‘‘Medicaid and Children’s 

Health Insurance Programs: Eligibility Notices, Fair 

Hearing and Appeal Processes for Medicaid and 

Other Provisions Related to Eligibility and 

Enrollment for Medicaid and CHIP’’ published in 

the November 30, 2016 Federal Register (81 FR 

86382, 86428). 

24See for example, CMS Office of Burden 

Reduction & Health Informatics, ‘‘Navigating the 

Medicare Savings Program (MSP) Eligibility 

Experience,’’ April 2022. https://www.cms.gov/ 

files/document/navigating-medicare-savingsprogram-msp-eligibility-experience-journeymap.pdf. 

that § 435.956(a)(4) requires States to 

maintain a record of having verified 

citizenship or immigration status and 

not re-verify or require MSP applicants 

to re-verify their status. 

Response: We agree that collecting 

missing information through a prepopulated form may help individuals 

respond timelier to States’ request for 

additional information. As such, we 

encourage States to use pre-populated 

forms as a best practice. At this time, 

though, we decline to make this a 

requirement for States because we are 

interested in providing States some 

flexibility in carrying out this particular 

requirement. However, we will consider 

this recommendation in the future based 

on program experience. In addition, we 

agree that § 435.956(a)(4) requires States 

to maintain a record of previously 

verified citizenship or immigration 

status, in accordance with the State’s 

records retention policy in accordance 

with § 431.17(c). Further, States may not 

re-verify or require MSP applicants to 

re-verify citizenship at renewal or 

subsequent application when such 

verification is documented in the 

individual’s case record unless the 

individual has reported a change in 

citizenship, the agency has received 

information indicating a potential 

change, and the individual is not 

exempt from the requirement to provide 

documentation of citizenship under 

§ 435.406(a)(1)(iii). We note that

consistent with current policy, States

may refrain from verifying immigration

status for individuals whose particular

status is not subject to change if

verification of such status is

documented in the individual’s case

record, the individual has not reported

a change, and the agency has not

received information indicating a

potential change.23

Comment: A few commenters shared 

feedback on CMS’s recommendation 

that States include information on how 

to contact the local SHIP when asking 

individuals for more information to 

make an MSP determination. Some 

commenters supported this 

recommendation, including a 

commenter that recommended that CMS 

make it mandatory. These commenters 

pointed out that SHIPs may be uniquely 

equipped to provide individuals one-onone help to explain State 

communications and how to satisfy the 

State request for additional information. 

Conversely, a commenter shared 

concerns that SHIPs may lack access to 

Medicaid systems or have adequate 

resources to assist individuals. Another 

commenter opposed this 

recommendation, asserting that SHIPs 

are an inappropriate resource because 

they lack authorization to verify 

applicant information. 

Response: We thank the commenters 

for their input regarding our 

recommendation for States to provide 

contact information for SHIPs when 

sending information requests for MSP 

determinations. Our program experience 

and input from interested parties have 

indicated that individuals may struggle 

to understand State communications 

and complete documentation requests 

without personalized assistance from 

eligibility workers or counselors, such 

as SHIPs.24 As such, we agree with the 

commenters that SHIPs may be a 

valuable resource to help individuals 

comprehend and complete requests for 

information. We acknowledge that 

SHIPs may lack the authority to verify 

data or check Medicaid systems but 

clarify that States would remain 

responsible for completing the 

verification processes. Further, we 

recognize that State-specific variables, 

for example, the capacity and 

willingness of the region’s SHIPs to 

provide this assistance, may affect 

whether a State Medicaid agency 

pursues our recommendation to include 

SHIPs as a resource in their requests for 

information from MSP applicants. Given 

all these considerations, we continue to 

recommend—rather than require—that 

States include contact information for 

SHIPs in their requests for additional 

information. 

Comment: Many commenters 

supported the proposal for States to 

screen MSP applications from leads data 

for full Medicaid benefits, indicating it 

would accelerate and streamline review 

of Medicaid eligibility for States and 

lower-income older adults and persons 

with disabilities who may not be able to 

separately navigate the Medicaid 

process. Some commenters further 

noted that States must screen 

individuals who apply for MAGI 

categories upon all bases and that failing 

to apply a similar ‘‘no wrong door’’ 

approach to MSP applications based on 

LIS data would disadvantage 

individuals who apply through the LIS 

application as compared to individuals 

who apply for MAGI-based Medicaid. 

These commenters also stated that 

adopting different screening standards 

across the MAGI and non-MAGI groups 

risks potential confusion and 

duplicative administrative work for 

State Medicaid agencies. 

Many of these same commenters, 

while supporting this proposal on 

balance, also expressed concerns that 

State implementation of the requirement 

to screen on all bases could undermine 

the streamlined application and 

enrollment processes for the MSPs that 

MIPPA and CMS’ proposed changes aim 

to achieve. Some commenters indicated 

that requiring a full Medicaid screen 

could slow down the MSP 

determination process if CMS does not 

require States to extend the streamlined 

income and resource verification rules 

for the MSPs to non-MAGI groups. They 

explained that States with different 

verification rules for other non-MAGI 

categories must routinely request 

additional documentation from MSP 

applicants and might wait to process the 

MSP application until the applicant 

provides additional documentation 

needed for the full Medicaid 

determination. For these reasons, some 

commenters requested that CMS clarify 

that the full Medicaid screen is separate 

from the MSP enrollment process and 

that States must not delay the MSP 

determination and approval for benefits 

to obtain information necessary for the 

full Medicaid determination. Similarly, 

some commenters shared concerns that 

State communications that combine 

requests for information missing from 

leads data and requests for information 

and disclosures about estate recovery 

needed for the full Medicaid 

determination could overwhelm and 

confuse applicants or give a false 

impression that estate recovery applies 

to the MSPs, thus deterring them from 

completing the MSP application. A 

commenter suggested that CMS work 

with States to test different approaches 

with consumers and develop best 

practices and options to seek additional 

information for full Medicaid, making 

State practices subject to our review. 

Another commenter suggested that CMS 

prohibit States from using the same 

notice to communicate a denial of full 

Medicaid coverage and a request for 

information for the MSPs, contending 

that individuals who receive combined 

notices are less likely to read and fulfill 

requests for additional information for 

the MSPs. A commenter recommended 

that SSA provide more information 

related to full Medicaid on the LIS 

application, including the required 

rights and responsibilities for the 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65237 

25See cover letter, question number 15, and 

signatures pages in the LIS application. https://

www.ssa.gov/forms/ssa-1020-ocr-sm-inst.pdf. 

Medicaid program. A few commenters 

suggested that our proposal would 

require States to accept leads data as 

verified for all non-MAGI eligibility 

groups and requested that CMS 

explicitly acknowledge this 

requirement. 

Some commenters expressed 

opposition to the proposal at 

§ 435.911(e)(6) to require States to 

screen individuals who apply for MSPs 

through LIS leads data for Medicaid on 

all bases. They cited some of the same 

issues identified by those who 

expressed support, including that 

because the LIS application does not 

request the relevant data for full 

Medicaid determinations or provide 

rights and responsibilities and required 

disclosures (for example, an explanation 

that estate recovery applies to full 

Medicaid benefits), States would need 

to follow up with individuals, slowing 

down and complicating what is 

intended to be a streamlined process for 

MSP enrollment. A commenter noted 

that individuals may not realize that 

estate recovery applies to full Medicaid 

benefits since the LIS application does 

not mention full Medicaid benefits or its 

implications. A few commenters 

suggested that screening MSP 

applications based on leads data for full 

Medicaid eligibility would in effect 

require the completion of a full 

Medicaid application. Another 

commenter requested that CMS more 

clearly delineate State requirements to 

screen MSP applications based on leads 

data upon all bases. Another commenter 

requested that CMS clarify the proposed 

§ 435.911(e), contending that the 

regulation text is disjointed and 

disorganized, making it unclear what is 

required for the MSPs versus full 

Medicaid groups. Similarly, the same 

commenter stated that CMS is 

inconsistent in how we refer to the 

Medicare Savings Programs, sometimes 

referring to them as the Medicare 

Savings Programs and other times by 

referencing section 1905(a)(10)(E) of the 

Act, for example. 

Finally, some commenters, including 

those opposing and supporting the 

proposal, shared concerns that 

screening individuals who apply for the 

MSPs based on leads data on all bases 

would require significant policy 

changes, eligibility systems changes, 

and/or manual effort for which they 

would need additional implementation 

time. 

Response: We thank the commenters 

for feedback about our proposal to 

require individuals who apply for MSPs 

through LIS leads data be screened for 

Medicaid on all bases. In the proposed 

rule (87 FR 54766), we indicated that 

our proposal was consistent with 

section 1902(a)(4) and (a)(19) of the Act, 

as it would facilitate the efficient 

enrollment of LIS enrollees into both the 

appropriate MSP eligibility group and 

into a full-benefit group if eligible 

without imposing undue administrative 

burden on States. We also noted that the 

requirement to screen MSP applicants 

based on leads data was similar to the 

existing requirement for States to screen 

individuals who apply for MAGI-based 

Medicaid on all bases. We still share the 

view that requiring States to assess such 

applicants for full Medicaid would 

facilitate their access to full-scope 

Medicaid coverage. However, we 

appreciate commenters’ concerns that 

certain ways of implementing our 

proposed requirement could potentially 

undermine the streamlined processes 

designed to facilitate MSP enrollment 

using leads data under MIPPA and this 

final rule. 

As commenters cited, the LIS 

application does not inform individuals 

that States will screen them on all bases 

or provide the rights and 

responsibilities, such as disclosures 

about estate recovery, that we require 

for Medicaid applications. Rather, the 

current LIS application obtains the 

individual’s consent to share their LIS 

information with the State ‘‘to start the 

application process for the Medicare 

Savings Programs.’’ 25 While it may be 

possible to add information about full 

Medicaid eligibility determinations to 

the LIS application, as a commenter 

suggested, we are concerned this could 

make it less likely that individuals 

complete the LIS application and agree 

to share their data with the State for an 

MSP determination. 

Under proposed § 435.911(e)(6), 

States would be required to both 

promptly complete a determination of 

eligibility for the MSPs and collect 

additional information needed to 

determine whether the individual is 

eligible for full Medicaid benefits. 

However, we recognize, after reviewing 

the comments, that the proposed rule 

was not clear about all of the steps 

States would need to make to determine 

eligibility for full Medicaid benefits, or 

all of the information they would need 

to make a determination for, and enroll 

an individual in, full Medicaid benefits. 

Specifically, in addition to obtaining 

additional information regarding 

eligibility criteria needed by the State 

for a full Medicaid determination, States 

would need to obtain the individual’s 

consent to enroll in full Medicaid 

benefits, which would also necessitate 

the State informing an individual who 

applied for the MSPs through the LIS 

application about the additional benefits 

that may be available, the rights and 

responsibilities associated with 

enrolling for full benefits, and the 

potential for estate recovery, which 

under section 1917(b)(1)(B) of the Act 

States must employ for Medicaid 

coverage of long-term care services and 

supports and related services and can 

employ for coverage of other Medicaid 

items and services, not including 

premium and cost-sharing assistance 

under the MSPs. 

States may also need to reach out to 

individuals who are applying for the 

MSPs through the LIS application to 

obtain additional information that is 

needed for the MSP determination. We 

share commenters’ concerns that a 

single communication that requests all 

of the information needed for the MSP 

determination and all of the information 

needed to determine full-benefit 

eligibility could overwhelm and confuse 

applicants and reduce their willingness 

and capacity to complete the steps 

required for States to make the MSP 

determination. Further, we agree with 

commenters that the full-benefit 

determination should not delay the MSP 

determination. 

After considering all of these factors 

raised by the commenters, we are 

revising the proposed regulation at 

§ 435.911(e)(6)(i) and (ii), redesignated 

at § 435.911(e)(9)(i) and (ii), to specify 

that the State must provide individuals 

effectively applying for the MSPs 

through an LIS application—in addition 

to and separate from any requests for 

additional information necessary for the 

determination of MSP eligibility—(1) 

information about the availability of 

Medicaid benefits on other bases, 

including the scope of such benefits and 

responsibilities of the individual 

applying for such benefits; and (2) an 

opportunity to furnish such additional 

information as may be needed to 

determine whether the individual is 

eligible for such additional Medicaid 

benefits. Under this final rule, a State 

may request CMS approval of another 

approach to ensuring that applicants 

have the opportunity to receive 

determinations on whether they are 

eligible for Medicaid benefits other than 

through an MSP. 

This change to our proposal in 

response to comments would avoid 

delays in MSP enrollment and avoid 

drawbacks associated with modifying 

the LIS application itself, while still 

facilitating enrollment in full Medicaid 

coverage if an individual is eligible. To 

provide States sufficient time to make a 


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26The 2010 MIPPA SMDL. https://

www.medicaid.gov/federal-policy-guidance/ 

downloads/smd10003.pdf. 

27The Manual for the State Payment of Medicare 

Premiums, chapter 1, section 1.6.2. https://

www.cms.gov/files/document/chapter-1-programoverview-and-policy.pdf. 

28Center for Medicaid and CHIP Services 

Informational Bulletin, ‘‘Opportunities to Increase 

Enrollment in Medicare Savings Programs,’’ 

November 1, 2021. https://www.medicaid.gov/ 

federal-policy-guidance/downloads/ 

cib11012021.pdf. 

full Medicaid determination for 

individuals applying for the MSPs 

through the LIS application, for 

purposes of timeliness standards under 

§ 435.912, the process of obtaining the 

additional information needed for the 

full Medicaid determination would 

begin a new clock for determining 

timeliness, since the initial transfer of 

leads data only includes the applicant’s 

authorization to initiate the application 

process for the MSPs and not full 

Medicaid. 

We encourage (but do not require) 

States to treat leads data as verified for 

the full-benefit Medicaid eligibility 

determination. However, in all cases, 

the State would still need to describe 

rights and responsibilities and 

applicable estate recovery rules, obtain 

a signature for enrollment, and seek 

additional information necessary for full 

Medicaid determinations. Further, in 

light of the commenter’s suggestion to 

clarify the regulation text, we are 

revising the regulation text to clarify 

requirements for States and to use 

consistent terminology for the MSPs. 

Comment: Some commenters 

suggested that CMS provide technical 

assistance and education to facilitate 

enrollment through Medicare Part D LIS 

leads data. A commenter encouraged 

CMS to provide technical assistance on 

issues related to leads data and engage 

with SSA to ensure data feeds to States 

are working properly. In particular, a 

commenter noted that its State began 

using LIS leads data in March 2021 and 

requested that SSA and CMS support 

the State in reconstructing LIS leads 

data before March 2021 to identify 

individuals contained in the leads data 

and to assess them for past eligibility for 

the MSPs. Another commenter 

requested that CMS do more to promote 

alignment between LIS and MSP 

programs such as by creating State plan 

amendment (SPA) templates and 

providing more technical assistance to 

States to illustrate how to align these 

methodologies. A commenter also urged 

CMS to provide States technical 

assistance on getting attestations over 

the phone and to encourage States to 

use telephonic attestations, instead of 

paper forms, to minimize situations 

where individuals are denied eligibility 

for failing to return paperwork. Another 

commenter urged CMS to provide 

technical assistance to Medicaid 

directors and their staff by holding a call 

or series of calls to address concerns 

about fraud in self-attestations. A 

commenter also recommended that CMS 

allow individuals to submit information 

through multiple modalities during the 

application process to support equity 

and inclusion. Another commenter 

recommended that CMS require States 

to use clear and simple language in the 

State’s notice of the eligibility 

determination. Finally, a commenter 

noted that individuals may have had 

negative experiences with applying for 

benefits in the past and urged CMS to 

educate current and potential enrollees 

about the new, streamlined processes 

using outreach that is easily understood 

and accessible. 

Response: To the extent that States 

need support in complying with new 

requirements under § 435.911(e), or are 

currently experiencing difficulties 

understanding, using, or manipulating 

the leads data, we are available to assist. 

In response to commenters’ concerns, 

we can also facilitate State discussions 

with SSA should States require 

technical assistance to access the leads 

data files transferred from SSA. (State 

Medicaid officials can reach us through 

their dedicated CMS points of contact.) 

In addition, while SSA does not 

generally store LIS leads data for past 

years, we are available to answer 

questions from States and to assist them 

when feasible with their data needs. We 

also are happy to provide technical 

assistance and best practices to States 

on using telephonic attestations instead 

of paper forms and to address concerns 

about fraud regarding self-attestation. 

We note that SSA uses telephonic 

attestations, so Medicare enrollees may 

be familiar with this procedure already. 

We appreciate the recommendations on 

promoting alignment between LIS and 

MSP programs and will consider these 

recommendations, including SPA 

checklists, for future guidance to States. 

We also appreciate the recommendation 

about format flexibility during the 

application process and note that States 

must already allow individuals to 

submit information through multiple 

modalities under § 435.907(a), as 

explained in the proposed rule (87 FR 

54780). Further, in accordance with 

§ 435.917, State eligibility determination 

notices must be written in plain 

language and be accessible to 

individuals with limited English 

proficiency and disabilities, among 

other requirements. Finally, we agree 

with the importance of clear, accessible 

education and outreach regarding new 

streamlined MSP provisions and will 

explore ways to support States with 

their MSP education and outreach 

efforts. 

Comment: A number of commenters 

provided feedback regarding the 

implementation timeline for the 

proposed provisions to streamline MSP 

determinations using leads data in new 

§ 435.911(e). Several of these 

commenters supported a 30-day 

implementation timeline, noting that 

the proposed provisions implement a 

statutory requirement to use leads data 

to initiate an MSP application that was 

enacted over 13 years ago. In contrast, 

some commenters, both supporting and 

opposing the leads data proposals, 

urged CMS to provide significant 

additional time to implement the 

proposed requirements in new 

§ 435.911(e) regarding leads data, since 

most of them constitute new substantive 

requirements established through this 

rulemaking under the authority in the 

leads data provisions under section 113 

of MIPPA. 

Response: The general requirement to 

use leads data to trigger an MSP 

application has been in Federal statute 

for over 13 years, and its requirements 

have been interpreted in guidance 

issued by CMS in 2010,26 2020,27 and 

2021.28 As such, the requirements for 

States to receive from SSA the LIS leads 

data and treat it as an MSP application 

as interpreted in existing guidance 

continue to apply as they have been 

applied under that guidance. However, 

new § 435.911(e) contains numerous 

new substantive regulatory 

requirements, and based on 

commenters’ feedback on this proposed 

rule we foresee that some States will 

require time to come into compliance 

with these provisions. Therefore, in 

response to these comments, we are in 

this final rule establishing a compliance 

date for the requirements in new 

§ 435.911(e) of April 1, 2026. Prior to 

the compliance date, we plan to provide 

technical assistance and guidance to 

States as they come into compliance 

with the new rules. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal at § 435.911(e) with the 

following modifications: 

• We are replacing references to 

section 1902(a)(10)(E) of the Act with 

the term the ‘‘Medicare Savings 

Programs’’ throughout paragraph (e); 

• We are adding language to 

paragraph (e) to clarify that the 

obligations in this paragraph apply to 

MSP eligibility determinations for 


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29Except, as noted previously in this final rule, 

information on citizenship and immigration status. 

30https://www.whitehouse.gov/briefing-room/ 

presidential-actions/2021/01/20/executive-orderadvancing-racial-equity-and-support-forunderserved-communities-through-the-federalgovernment/. 

individuals who have applied for LIS 

and have granted permission for SSA to 

share LIS leads data with the Medicaid 

agency for the purpose of submitting an 

application for the MSPs; 

• We are reordering the paragraphs, 

revising requirements, and clarifying 

language as follows: 

++ Paragraph (e)(1): We are retaining 

the requirement to accept LIS leads data 

in paragraph (e)(1) but are removing the 

term ‘‘Low Income Subsidy application 

data’’ and using an acronym in place of 

‘‘Social Security Administration’’ since 

‘‘LIS leads data’’ and ‘‘SSA’’ are now 

established in paragraph (e); 

++ Paragraph (e)(2): We are keeping 

the requirement to treat LIS leads data 

as an application for the MSPs without 

requiring submission of another 

application in paragraph (e)(2), but are 

moving the requirement regarding 

timely application processing to 

paragraph (e)(7). 

++ Paragraph (e)(3): We are moving 

the requirement to accept data from 

SSA, which we are now specifying as 

LIS leads data for greater consistency in 

terminology throughout the regulation, 

without further verification, from 

proposed paragraph (e)(5) to paragraph 

(e)(3) and adding that this provision 

applies unless the State agency has 

information that is not reasonably 

compatible with the LIS leads data or 

the LIS leads data would not support a 

determination of MSP eligibility; 

++ Paragraph (e)(4): We are retaining 

the requirement to not collect 

information or documentation from the 

individual in paragraph (e)(4) and are 

adding that this is unless the State 

agency has information that is not 

reasonably compatible with the LIS 

leads data; 

++ Paragraph (e)(5): We are moving 

the requirement to request additional 

information from proposed paragraph 

(e)(3) to paragraph (e)(5), replacing the 

term ‘‘request’’ with the term ‘‘seek,’’ 

and defining additional information 

needed for the MSP determination as 

information that is not in the LIS leads 

data; 

++ Paragraph (e)(6): We are moving 

the requirement to verify an individual’s 

citizenship and immigration status from 

proposed paragraph (e)(6)(iii) to 

paragraph (e)(6), adding a citation to 

§ 435.406, and streamlining the 

regulation text; 

++ Paragraph (e)(7): We are moving 

the requirement regarding timely 

application processing from paragraph 

(e)(2) to paragraph (e)(7); 

++ Paragraph (e)(8): We are moving 

additional requirements if the LIS leads 

data does not support a determination of 

MSP eligibility from proposed 

paragraph (e)(7) to paragraph (e)(8). 

++ Paragraph (e)(9): We are moving 

and modifying the proposal related to 

screening for full Medicaid from 

paragraphs (e)(6)(i) and (ii) to 

paragraphs (e)(9)(i) and (ii) to require 

States to provide individuals with—in 

addition to and separate from any 

requests for additional information 

necessary for a determination of 

Medicare Savings Program eligibility, 

unless CMS approves otherwise— 

information about the availability of 

additional Medicaid benefits on other 

bases, including the scope of such 

benefits and responsibilities of the 

individual applying for such benefits, 

and an opportunity to furnish such 

additional information as may be 

needed to determine whether the 

individual is eligible for such additional 

Medicaid benefits. 

• Finally, we are applying a 

compliance date of April 1, 2026 for 

States to come into full compliance with 

all the provisions in new § 435.911(e) to 

facilitate MSP enrollment through LIS 

leads data. 

Streamlining Methodologies. Prior to 

January 1, 2024, the Federal resource 

limits for full LIS and the MSPs are the 

same ($9,090 for an individual and 

$13,636 for a couple in 2023), and the 

income limits for full LIS and the 

highest income band MSP (the QI 

group) are both 135 percent of the FPL. 

Beginning January 1, 2024, section 

11404 of the Inflation Reduction Act 

(IRA) expands eligibility for the full LIS 

benefit by revising the statutory income 

limit to 150 percent of the FPL and 

increasing the resource limits for full 

LIS to the resource limits for partial LIS 

($15,160 for an individual and $30,240 

for a couple in 2023). The IRA did not 

make conforming changes to the income 

or resource standards for the MSPs. 

While the income and resources 

methodologies for the MSPs and LIS are 

very closely aligned, certain differences 

prevent LIS enrollees from being 

seamlessly enrolled into the MSPs 

unless the State has elected to align the 

MSP methodologies with LIS 

methodologies by adopting certain 

income and resource disregards under 

section 1902(r)(2) of the Act. As we 

discussed in detail in the proposed rule 

(87 FR 54765), States have the flexibility 

to achieve full alignment of the MSP 

and LIS financial methodologies. If 

States choose to completely align MSP 

and LIS financial methodologies, they 

would disregard the following types of 

income: in-kind support and 

maintenance, dividend income, and 

interest income; and the value of the 

following types of resources: non-liquid 

resources, and life insurance. States 

would also disregard up to $1,500 in 

burial funds for an applicant (and an 

additional $1,500 for their spouse) that 

may be co-mingled with other accounts 

(that is, no longer require such funds are 

set aside in a separate burial account). 

As noted previously in this final rule, 

States that adopt less restrictive MSP 

eligibility methodologies to completely 

align them with the LIS methodologies 

would be able to use leads data to make 

a determination of MSP financial 

eligibility without requesting additional 

financial information from the 

individual.29

However, States that have not fully 

aligned methodologies must determine 

financial eligibility by requesting 

additional information not provided 

through the leads data. In addition, as 

noted in the proposed rule at 87 FR 

54766, if not already contained in the 

record from a prior application, all 

States—whether or not they have 

aligned their MSP financial 

methodologies with MSP—must request 

information relating to U.S. citizenship 

and immigration status to verify such 

status in accordance with the State’s 

usual processes in accordance with 

§ 435.406(a) and section 1137(d) of the 

Act. 

In accordance with the authority at 

section 1902(a)(4) of the Act to promote 

the administrative efficiency of the 

program and section 1902(a)(19) of the 

Act relating to simplicity of 

administration and the best interests of 

beneficiaries, we proposed to add a new 

paragraph (e) to § 435.952 to require that 

States adopt a number of enrollment 

simplification policies related to the 

income and resources that are counted 

in determining MSP, but not LIS, 

eligibility that would enable State 

agencies to use the leads data more 

efficiently, reduce burden on applicants 

and States, and increase the number of 

LIS enrollees successfully enrolled in 

the MSPs. We also anticipate these 

policies will have a positive health 

equity impact by increasing access to 

Medicare coverage for low-income 

individuals and increasing the financial 

security of those who successfully 

enroll, consistent with the January 20, 

2021 Executive Order.30

Finally, we anticipate that these 

enrollment simplifications will help 

reduce the high rate of churn (cycling in 

and out of Medicaid coverage) that 


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31Assistant Secretary for Planning and Evaluation 

(ASPE), ‘‘Loss of Medicare-Medicaid dual eligible 

status: Frequency, contributing factors and 

implications’’ May 2019. https://aspe.hhs.gov/ 

system/files/pdf/261716/DualLoss.pdf. 

32CMS completed an updated internal analysis of 

ASPE’s study in 2021 using data from 2015–2018 

that shows that dually eligible individuals continue 

to lose Medicaid at a high rate in their first year 

due to administrative reasons. 

33See for example, CMS Office of Burden 

Reduction & Health Informatics, ‘‘Navigating the 

Medicare Savings Program (MSP) Eligibility 

Experience,’’ April 2022. https://www.cms.gov/ 

files/document/navigatingmedicare-savingsprogram-msp-eligibilityexperience-journeymap.pdf. 

dually eligible individuals experience 

largely due to administrative reasons 

such as providing documentation of 

certain income and assets to 

demonstrate their continued eligibility. 

Analyses by the Assistant Secretary for 

Planning and Evaluation (ASPE) of the 

Department of Health and Human 

Services found that almost 30 percent of 

individuals lost Medicaid eligibility for 

at least one month during the first year 

of transitioning to full-benefit dual 

eligibility and more than 20 percent lost 

Medicaid eligibility for at least 3 months 

following the transition despite dually 

eligible individuals’ relatively stable 

income and assets over time.31 32 Experts 

interviewed noted that dually eligible 

individuals most often lost coverage 

because of failing to comply with 

administrative requirements as opposed 

to changes in income, assets, or 

functional status. We discuss our 

proposed simplifications for each source 

of income and resource below. 

We received comments on our 

proposals to align the MSP and LIS 

programs in general, and our responses 

follow. 

Comment: Many commenters 

supported CMS’s proposed alignments 

of MSP and LIS programs in general, 

citing that the proposed changes would 

allow States to use LIS leads data more 

efficiently, increase MSP enrollment for 

LIS enrollees, have a positive health 

equity impact, and reduce churn for all 

dually eligible individuals. Many 

commenters explained that procedural 

hurdles, particularly documentation 

requirements, are among the main 

reasons eligible individuals fail to 

complete the enrollment process or that 

benefits are delayed for individuals who 

manage to complete the process. A 

commenter explained that collecting 

paper records is particularly 

overwhelming for low-income 

individuals, who disproportionately 

have unstable housing, low literacy, 

limited access and proficiency in 

internet usage, limited proficiency in 

English, and live with disabilities and 

chronic conditions. The commenter 

stated that adopting measures to reduce 

these unnecessary impediments falls 

squarely within CMS’s legal authority. 

MACPAC supported this proposal, 

noting consistency with its June 2020 

recommendations to Congress to align 

MSP and LIS income and resource 

requirements. A few commenters shared 

that their States are moving toward 

complete alignment of LIS and MSPs 

and expressed support for CMS’s 

proposal to determine individuals 

eligible for the MSPs based on LIS data 

without seeking additional information 

if the LIS and MSP programs are 

completely aligned. 

Response: As discussed in the 

proposed rule (87 FR 54766 & 54767), 

we anticipate that streamlining income 

and resources verification processes and 

improving alignment between the LIS 

and MSP programs will allow States to 

employ LIS data more effectively, 

reduce churn for dually eligible 

individuals, and increase the percentage 

of LIS enrollees who are enrolled in the 

MSPs, resulting in significant economic 

and health benefits and promoting 

health equity for low-income Medicare 

beneficiaries. For that reason, as 

explained in the proposed rule (87 FR 

54766 and 54767), adopting enrollment 

simplifications for income and 

resources that are relevant to MSP 

determinations, but not LIS, implements 

our authority at section 1902(a)(4) of the 

Act to promote the administrative 

efficiency of Medicaid and section 

1902(a)(19) of the Act regarding 

simplicity of administration and the 

best interests of beneficiaries. We also 

appreciate that some States are moving 

toward full alignment, which we 

recommended in the proposed rule (87 

FR 54765). We believe that full 

alignment of financial eligibility rules 

for LIS and the MSPs is the most 

efficient means for States to maximize 

leads data and improve participation in 

the MSPs for LIS enrollees. 

Comment: A number of commenters 

noted that the proposals would create 

different verification processes for the 

MSPs than for other Medicaid groups. 

Some commenters opposed applying 

different verification processes for the 

MSPs on the grounds that it would be 

administratively challenging and cause 

confusion and delays. Both the 

commenters that generally opposed and 

the commenters that generally 

supported our proposals expressed 

concerns that creating a separate process 

for the MSPs could require significant 

system modifications. A commenter, 

while supporting the proposals at new 

§ 435.952(e) to simplify income and

resources verification procedures for

MSP determinations, suggested that

CMS consider adopting these

requirements through sub-regulatory

guidance to allow States flexibility to

adopt less restrictive income and

resource methodologies.

Response: We generally agree with the 

aim of providing uniform eligibility and 

enrollment processes, and we are 

committed to ensuring their operational 

feasibility. However, many States 

already apply different rules to the 

MSPs than other non-MAGI 

populations. For example, many States 

have adopted disregards that effectively 

raise or remove the resource test for the 

MSPs only. Therefore, we conclude that 

applying separate rules for the MSPs is 

not an insurmountable barrier to 

effective implementation. 

Further, in addition to comments on 

the proposed rule, feedback from 

interested parties and program 

experience demonstrate that 

documentation requirements seriously 

hinder the ability of eligible individuals 

to enroll in the MSPs, with significant 

economic and health impacts for 

individuals.33 Reducing the burden on 

applicants to produce certain types of 

documentation prior to enrollment is 

warranted to meaningfully address 

documented under-enrollment in these 

programs. Through this final rule, we 

are allowing additional time for States 

to update State procedures and systems, 

as discussed below. In addition, with 

respect to the commenter’s concerns 

that our regulations at § 435.952(e) may 

impede State flexibility to relax MSP 

eligibility requirements, we clarify that 

they would not impede State’s ability to 

adopt more liberal income and resource 

methodologies under 1902(r)(2) of the 

Act. 

Comment: Several other commenters 

opposed CMS’s alignment of MSP and 

LIS programs, asserting that requiring 

States to accept self-attestation would 

lead to fraud. A commenter cited 

difficulties with having their State 

legislature approve self-attestations due 

to program integrity concerns. Another 

commenter requested clarification 

regarding how reasonable compatibility 

standards would apply to resources 

obtained through electronic sources. In 

addition, a commenter, while 

supporting CMS proposals to require 

self-attestation of certain income and 

resources for the MSPs, requested that 

Federal audit protocols exempt States 

from penalties for errors related to selfattestation. 

Response: As stated elsewhere, selfattestation is an acceptable means of 

verification, and we note that many 

States have incorporated self-attestation 


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into their Medicaid verification plans. 

We also reiterate that, prior to 

enrollment, States must seek additional 

information if the self-attested 

information is not reasonably 

compatible with State information and 

that States retain the option to verify 

self-attested information after the 

individual has been enrolled. We plan 

to address the commenter’s question 

about how reasonable compatibility 

standards would apply to resources 

obtained through electronic sources in 

future rulemaking concerning the 

remaining provisions in the proposed 

rule published in the September 7, 2022 

Federal Register. 

Regardless of whether a State 

legislature objects to self-attestation as a 

means of verification, States are still 

required to follow Federal regulations. 

Further, as noted at 87 FR 54765, States 

also have the ability to align the MSP 

and LIS income and resource 

methodologies, which would remove 

the need for States to separately verify 

income and/or resources that are 

missing from leads data. In response to 

the question about Federal audits, we 

reiterate that we conduct audits based 

on Federal statutory and regulatory 

requirements. To the extent that we 

review compliance with § 435.952(e), 

we would identify an error if a State has 

failed to comply with this provision and 

would not identify an error if the State 

is complying with this requirement. 

Comment: A few commenters sought 

clarifications or additional CMS action. 

For example, a commenter requested 

clarification on why MSP and LIS 

income and resources standards are 

only aligned until January 1, 2024. 

Another commenter requested that CMS 

require States to adopt verification plans 

for the MSPs and other non-MAGI 

groups. A different commenter 

requested that CMS provisions to 

promote MSP enrollment and retention 

extend to the Programs of All-Inclusive 

Care for the Elderly (PACE) for 

individuals dually entitled to Medicare 

and Medicaid. 

Response: Prior to January 1, 2024, 

Federal resource limits for full LIS and 

the MSPs are aligned, and the income 

limits for the full LIS benefit and the 

highest band MSP (the QI group) are the 

same. Section 11404 of the IRA 

expanded eligibility for the full LIS 

benefit beginning January 1, 2024, but 

did not make any conforming changes 

for the MSPs. Starting January 1, 2024, 

individuals who previously were 

eligible only for partial LIS benefits may 

be eligible for full LIS benefits under the 

changes enacted under the IRA. This is 

because the resource limit for full LIS 

will increase to the current partial LIS 

resource limit ($15,160 for an individual 

and $30,240 for a couple in 2023). 

While more individuals will qualify 

for full LIS beginning in 2024, and many 

full LIS enrollees will continue to 

qualify for the MSPs, beginning in 2024 

there will be more full LIS enrollees 

who do not qualify for the MSPs. This 

is because the MSP resource limit will 

remain unchanged. Also, while the 

income threshold for full LIS will 

increase to 150 percent of the FPL 

beginning in 2024, the Federal income 

threshold for the QI group will remain 

at 135 percent of FPL. While we 

acknowledge that the income and 

resource limits for full LIS and MSPs 

will no longer align after January 1, 

2024, we still expect that the 

methodological changes that we are 

finalizing in this final rule will result in 

streamlined enrollment into MSPs. 

TABLE 1—COMPARISON OF MSP AND LIS INCOME AND RESOURCE LIMITS * 

Income limit Resource limit 

QMB ................................................ ≤100% FPL ................................................................ 3 × SSI limit adjusted for inflation per section 

1905(p)(1) of the Act. 

SLMB ............................................... >100% FPL, but <120% FPL .................................... same as QMB. 

QI ..................................................... ≥120% FPL, but <135% FPL .................................... same as QMB. 

Full LIS before 2024 ....................... <135% FPL ................................................................ same as QMB. 

Full LIS beginning 2024 .................. <150% FPL ................................................................ $15,160—Individual. 

$30,240—Couple plus inflation.** 

* These are the standard Federal income limits and resources. All of these income limits include a standard $20 disregard. States may use authority under section 1902(r)(2) of the Act to implement income and/or resource methodologies that are more generous than the Federal baseline 

for QMB, SLMB, and QI. 

** The LIS resource methodology as of January 1, 2024 is no longer tied to the 3 × SSI resource limit, which is a lower rate, but is instead tied 

to a flat dollar amount of $10,000 for an individual and $20,000 for a couple from 2006 and indexed for inflation every year. The rate listed is the 

2023 rate, which will need to be adjusted upward by inflation for 2024. 

In addition, we clarify that, in 

accordance with § 435.945(j), States 

must already adopt verification plans 

for all Medicaid eligibility groups, 

including the MSPs and other nonMAGI groups. Finally, we note that our 

proposals would apply to current and 

potential PACE participants. 

Interest and Dividend Income. 

Regulations governing LIS eligibility 

determinations at 20 CFR 418.3350(d) 

exclude all interest and dividend 

income earned on resources owned by 

the applicant or their spouse. However, 

under the SSI income methodologies 

applicable to MSP determinations, 

States must count interest and dividend 

income unless they have elected to 

disregard such income under section 

1902(r)(2) of the Act and § 435.601(d). 

In the proposed rule (87 FR 54767), 

citing reports from interested parties 

and program experience, we noted that 

the vast majority of individuals likely to 

qualify for an MSP eligibility group do 

not have significant interest or dividend 

income, whereas the requirement to 

timely obtain and furnish acceptable 

statements from financial institutions, 

sometimes extending back over a 

lengthy period of time, to document 

interest and dividend income earned is 

unduly burdensome for applicants and 

provides negligible program integrity 

value. Therefore, consistent with section 

1902(a)(19) of the Act, to minimize 

undue administrative burden on 

applicants, we proposed at 

§ 435.952(e)(1)(i) and (ii) to prohibit 

States from requesting documentation of 

dividend and interest income prior to 

making a determination of MSP 

eligibility, except when the agency has 

information that is not reasonably 

compatible with the applicant’s 

attestation. Under the proposed rule, 

States would be required to accept selfattestation of dividend and interest 

income for MSP applicants and their 

spouse, but would retain the option to 

verify such income after the individual 

has been enrolled (a process, currently 

available at State option with respect to 

most eligibility criteria, which we refer 

to as ‘‘post-enrollment verification’’), 

including the option to require the 


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individual to provide documentation of 

interest or dividend income if electronic 

verification is not available. 

We received comments on our 

proposal to streamline eligibility and 

verification processes for dividend and 

interest income, and our responses 

follow. 

Comment: A few commenters 

indicated particular support for this 

provision, explaining dividend and 

interest information is often difficult for 

applicants to obtain and constitutes an 

unnecessary administrative burden for 

applicants. One commenter noted an 

example in which an applicant was 

required to provide dividend 

verification based on a report from the 

IRS of a total annual dividend of under 

$5 on a single share of stock of a former 

employer worth less than $50. The 

agency required documentation 

verifying both the value of the asset and 

the amount of the dividend. According 

to the commenter, the process of 

clarifying the source of the dividend at 

issue and then obtaining documentation 

of the share, its current value, and the 

dividend payment history for the last 

year took several months, even with the 

assistance of an advocate, significantly 

delaying completion of the application 

and receipt of benefits. Lastly, another 

commenter requested clarification about 

whether consideration of interest 

income applies only to screening MSP 

applications from LIS leads data or to 

eligibility determinations for all 

individuals who apply for MAGI-based 

groups. 

Response: Self-attestation minimizes 

undue administrative burden on 

applicants who are unlikely to have 

investments large enough to generate 

significant interest or dividend income 

and resources and still satisfy the 

resource test for the LIS or MSP benefit. 

States retain the option to verify the 

information from the self-attestation 

after the individual has been enrolled, 

including requiring the individual to 

provide documentation of interest or 

dividend income if electronic 

verification is unavailable. 

With respect to the commenter’s 

requests for clarifications for how 

consideration of interest income applies 

to MAGI groups, we believe the 

commenter was referring instead to 

whether this provision requiring selfattestation of interest and dividend 

income applies to all individuals 

applying to MSP or only those who use 

the LIS process to apply. As such, we 

clarify that our proposal regarding 

required self-attestation for MSP 

eligibility determinations applies 

regardless of whether an individual 

applies for an MSP directly through the 

Medicaid agency or indirectly through 

the LIS pathway. Additionally, we note 

that interest and dividend income is 

currently counted in both MAGI and 

non-MAGI eligibility determinations. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule under 

§ 435.952(e)(1)(i) and (ii) and our 

responses to comments, we are 

finalizing our proposal on selfattestation for interest and dividend 

income, except with a modified 

compliance date of April 1, 2026. 

Post-eligibility Verification. We also 

sought comment on the utility of postenrollment verification and whether it 

results in unnecessary procedural 

denials of eligible individuals. If a State 

chooses to conduct post-enrollment 

verification checks, under proposed 

§ 435.952(e)(1)(iii) it must allow 

individuals at least 90 calendar days to 

respond to requests for documentation. 

We sought comment on the proposal to 

require that States provide individuals 

with at least 90 calendar days to 

respond to requests for additional 

information in this situation and 

whether States should be required to 

provide, at a minimum, a shorter period 

of time, such as at least 30 or 60 

calendar days. If a State found that an 

individual has income exceeding the 

income standard during the postenrollment verification process, the 

State would take appropriate action 

consistent with regulations at 

§ 435.916(d), which we proposed to 

redesignate and revise at § 435.919 in 

the proposed rule, including 

determining eligibility on other 

potential bases and, if not eligible on 

any basis, providing advance notice and 

fair hearing rights prior to terminating 

MSP coverage. We note that, consistent 

with current policy, when a State has 

information that is not reasonably 

compatible with the applicant’s 

attestation of the value of any interest or 

dividend income, proposed 

§ 435.952(e)(1)(ii) would require the 

State to seek additional information in 

accordance with § 435.952(c)(2), prior to 

enrolling the individual in Medicaid. 

We received the following comments 

on post-enrollment verification, 

including the timeline for responding to 

requests for additional information, and 

our responses follow. 

Comment: Some commenters 

requested CMS minimize postenrollment verification as much as 

possible because it would be too 

burdensome and confusing for 

individuals and may lead to 

terminations for eligible individuals. A 

few commenters requested that CMS 

provide model notices to States because 

requests for information can cause 

confusion or be missed by individuals 

who have just been approved for 

benefits. A commenter also requested 

that States include information in these 

post-eligibility verification notices on 

disputing errors. A few commenters 

requested clarification on how postenrollment verification would affect 

eligibility for long-term care services 

and if a denial would trigger benefit 

recovery. Other commenters indicated 

the process would be too burdensome 

for States and, therefore, opposed 

requiring States to adopt post-eligibility 

verification. 

Response: We acknowledge that postenrollment verification, like other 

requests for additional information/ 

documentation, could pose a burden to 

individuals. However, to allow selfattestation of income and resources 

needed for MSP eligibility 

determinations but missing from leads 

data, we believe it is essential to provide 

States a mechanism to ensure program 

integrity. To help minimize burden and 

assist States in making beneficiary 

notices as comprehensive and clear as 

possible, we will explore providing 

model language for State 

communications regarding postenrollment verification, including the 

instructions about disputing errors 

contained in the post-enrollment 

verification notice. With regard to the 

commenters’ recommendation that posteligibility verifications be optional, we 

note that we did not propose making 

this mandatory for States. In response to 

the commenter’s question about how 

post-eligibility verification may affect 

beneficiary coverage for long-term care 

services, we clarify that our proposal 

only requires self-attestation for the 

MSPs and not other non-MAGI groups. 

Comment: A number of commenters 

provided feedback on the proposed 90- 

day minimum deadline for individuals 

to return information requested by a 

State. Several commenters supported 

providing at least 90 calendar days for 

individuals to respond with the 

requested information, citing 

longstanding barriers to verification for 

individuals. However, a commenter 

observed that 90 days was too long 

based on their State’s experience using 

a 90-day timeline to resolve income 

discrepancies. The commenter noted 

that individuals forgot to supply the 

requested information as a result of the 

prolonged timeline and recommended 

30 days instead. Another commenter 

opposed a 90-day timeline for postenrollment verification because it could 

lead to 3 months of improper payments. 

Another commenter, while supporting 

the option for post-eligibility 


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34The exception to this rule is that the equity 

value of any real property than an individual owns 

other than the individual’s primary place of 

residence is counted as a resource. 

verification, sought clarification on 

whether States would need to recoup 

Medicaid provider payments for an 

individual for whom the State had 

accepted self-attestation prior to 

enrollment and then determines 

ineligible through post-eligibility 

verification. 

Response: We thank the commenters 

for their input on the appropriate 

minimum timeframe for individuals to 

respond to requests for information 

following enrollment. We do not agree 

with commenters that the 90-day 

timeframe is excessive given the 

challenges low-income individuals 

encounter in obtaining and furnishing 

paperwork, as described throughout this 

final rule and by commenters. Our 

position is also informed by our 

program guidelines and experience 

related to resolving income data 

matching issues (DMIs) following 

determinations of eligibility for 

Advance Premium Tax Credits (APTC) 

for the Exchanges that use the Federal 

eligibility and enrollment platform. A 

90-day period aligns with the minimum 

deadline for individuals to respond to 

Exchange requests for additional 

information under 45 CFR 

155.315(f)(2)(ii). We note that in the 

April 2023 final rule titled ‘‘Patient 

Protection and Affordable Care Act, 

HHS Notice of Benefit and Payment 

Parameters for 2024’’ (2024 Payment 

Notice) published in the Federal 

Register (88 FR 25740), we adopted an 

automatic 60-day extension for 

individuals applying for coverage 

through Exchanges who failed to 

respond in the 90-day period. We 

adopted that change in the 2024 

Payment Notice after observing that 

income DMI data indicates that when 

consumers receive additional time, they 

are more likely to successfully provide 

documentation to verify their projected 

household income. Between 2018 and 

2021, over one third of consumers who 

resolved their income DMIs on the 

Exchange did so in more than 90 days. 

We also note that the Exchanges that use 

the Federal eligibility and enrollment 

platform send reminders to consumers 

through multiple modalities to prompt 

them to timely furnish the required 

information. 

In response to the commenters’ 

concerns about the potential for 

increasing improper payments, we note 

that self-attestation is an acceptable 

means of verification and that many 

States have incorporated it into their 

verification policies as a generally 

reliable alternative to requiring 

applicants to produce documentation. 

As such, the period during which an 

individual would be enrolled in an MSP 

based on self-attestation that proved to 

be incorrect would not be an improper 

payment, nor would an individual be 

subject to administrative benefit 

recovery if they are later found to be 

ineligible. In addition, we clarify that 

States would not administratively 

recoup payments already made on 

behalf of individuals if post-eligibility 

verification processes establish that the 

individual is ineligible for the MSPs. If 

a State suspects that an individual 

committed fraud or abuse in order to 

obtain or maintain MSP eligibility, the 

State should follow the processes 

described at 42 CFR part 455, subpart A 

of the regulations. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal to require States that choose to 

conduct post-eligibility verification to 

provide individuals with at least 90 

calendar days to respond to requests for 

additional information, with a modified 

compliance date of April 1, 2026. 

Non-liquid resources. For LIS 

eligibility determinations, under 20 CFR 

418.3405, SSA only counts liquid 

resources, which it defines as cash, 

financial accounts, and other financial 

instruments that can be converted to 

cash within 20 business days. Nonliquid resources, such as an automobile, 

are not counted for LIS eligibility.34

However, MSP determinations generally 

use a broader definition of countable 

resources that includes non-liquid 

resources; for example, while one 

automobile is excluded for resourceeligibility purposes, a second 

automobile is countable. As we noted in 

the proposed rule at 87 FR 54768, this 

can be onerous for MSP applicants 

because it can be difficult to timely 

determine, and furnish acceptable 

documentation of, the value of 

something that cannot easily be sold. 

Similar to interest and dividend 

income, consistent with section 

1902(a)(19) of the Act and to minimize 

administrative burdens on individuals, 

we proposed at § 435.952(e)(2)(i) to 

require that States accept applicants’ 

attestation of the value of any nonliquid resources, except, as described at 

proposed § 435.952(e)(2)(ii), when the 

State has information that is not 

reasonably compatible with the 

individual’s attestation. As with 

dividend and interest income, proposed 

§ 435.952(e)(2)(ii) clarifies that States 

must request documentation prior to 

making an initial determination of 

eligibility if they have information that 

is not reasonably compatible with the 

applicant’s attestation in accordance 

with § 435.952(c)(2). However, as with 

dividend and interest income, States 

would retain the option to conduct postenrollment verification, including the 

option to require the individual to 

provide documentation of non-liquid 

resources if electronic verification is not 

available, and to take appropriate 

action, consistent with regulations at 

§ 435.916(d), which we proposed to 

redesignate and revise at § 435.919 in 

the proposed rule, if the State 

determines the individual greatly 

undervalued or failed to disclose 

resources. If the agency elects to 

conduct verifications post-enrollment, 

and documentation is requested, we 

proposed that the agency must provide 

the individual with at least 90 calendar 

days from the date of the request to 

respond and provide any necessary 

information requested. 

We received comments on our 

proposal to require States to accept selfattestation on non-liquid assets and 

prohibit States from requesting 

documentation except where the agency 

has information incompatible with a 

self-attestation, and our responses 

follow. 

Comment: In addition to several 

commenters expressing general support 

for self-attestation for simplifying 

enrollment regarding income, one 

commenter supported the proposal on 

non-liquid assets because this 

information is often difficult for 

applicants to obtain and poses 

unnecessary administrative burdens on 

applicants. 

Response: Self-attestation minimizes 

undue administrative burden on 

applicants, including identifying the 

value of a non-liquid asset that cannot 

be sold. States retain the option to verify 

the information from the self-attestation 

with new information after the 

individual has been enrolled, including 

requiring the beneficiary to provide 

documentation of non-liquid resources 

if electronic verification is not available, 

and take appropriate action if the State 

determines the individual greatly 

undervalued or failed to disclose 

resources. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal on non-liquid assets with a 

modified compliance date of April 1, 

2026. 

Burial funds. Under section 

1613(d)(1) of the Act, which applies to 

both LIS and MSP determinations, up to 


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$1,500 in burial funds are to be 

excluded for the applicant (and an 

additional $1,500 for their spouse) so 

long as the burial fund is ‘‘separately 

identifiable and has been set aside.’’ The 

statute does not, however, prescribe 

how the funds must be separately 

identifiable. As discussed in the 

proposed rule at 87 FR 54768, current 

SSA policy allows LIS applicants to 

attest to having $1,500 in burial funds, 

which may be co-mingled with other 

funds in a single account, but for MSP 

eligibility determinations States 

typically require applicants to provide 

documentation that their burial funds 

are set aside in a separate account. This 

creates a misalignment between LIS and 

MSP methodologies and imposes 

additional burdens on MSP applicants. 

We proposed at § 435.952(e)(3)(i) to 

require that States, when determining 

eligibility for the MSPs, allow 

individuals to self-attest that up to 

$1,500 of their resources, and up to 

$1,500 of their spouse’s resources, are 

set aside as burial funds in a separate 

account, and therefore, are not 

countable as resources for MSP 

determinations. Proposed 

§ 435.952(e)(3)(ii) clarifies that States 

must request documentation prior to 

making an initial determination of 

eligibility if they have information that 

is not reasonably compatible with the 

applicant’s attestation in accordance 

with § 435.952(c)(2). As in the proposed 

provisions for interest and dividend 

income and non-liquid resources, and 

described at § 435.952(e)(3)(iii), States 

would retain the option to conduct postenrollment verification, including 

requiring documentation of resources in 

burial funds, and taking appropriate 

action, consistent with regulations at 

§ 435.916(d), which we proposed to 

redesignate and revise at § 435.919 in 

the proposed rule. Under proposed 

§ 435.952(e)(1)(iii), if the agency elects 

to conduct verifications post-enrollment 

and requests documentation, the agency 

must provide the individual with at 

least 90 calendar days from the date of 

the request to respond and provide any 

necessary information requested. 

Finally, States may also use authority 

at section 1902(r)(2) of the Act to 

disregard all or a greater amount of 

burial funds or to not require that the 

burial funds be held in a separate setaside account. 

We received comments on our 

proposals related to burial funds, and 

our responses follow. 

Comment: A few commenters 

specifically wrote in support of 

accepting self-attestation for burial 

funds. A commenter suggested that the 

rule be revised so that applicants are not 

required to maintain a separate account 

for burial funds or that they can 

acknowledge in their self-attestation 

that they will set up a separate account 

within 90 days of the self-attestation. 

This commenter also noted that lowincome individuals are 

disproportionately ‘‘unbanked’’ and 

thus do not have access to banks where 

they can segregate funds in separate 

accounts. 

Response: Self-attestation minimizes 

undue administrative burden on 

applicants. States retain the option to 

verify the information from the selfattestation after the individual has been 

enrolled, including requiring the 

beneficiary to provide documentation of 

burial fund resources and take 

appropriate action if the State 

determines the individual greatly 

undervalued or failed to disclose 

resources. We appreciate the 

commenter’s concern that creating a 

separate account poses additional 

burdens on applicants, including those 

who are ‘‘unbanked.’’ However, as 

described previously in this final rule, 

section 1613(d)(1) of the Act stipulates 

that the burial fund exclusion applies to 

funds that are ‘‘separately identifiable’’ 

and have been ‘‘set aside.’’ Accordingly, 

in this final rule, we decline to 

incorporate the commenter’s 

suggestions to require States to 

eliminate the requirement for a separate 

account for burial funds. We also 

decline to allow 90 days post selfattestation to create a separate account 

in this final rule, but we may consider 

whether there is a basis for such a 

policy in the future. As noted 

previously in this final rule, States may 

choose to eliminate the requirement that 

burial funds be held in a separate 

account under section 1902(r)(2) of the 

Act. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal on burial funds with a 

modified compliance date of April 1, 

2026. 

Life Insurance Policies. Section 116 of 

MIPPA, codified at section 1860D– 

14(a)(3)(G) of the Act, eliminated the 

value of life insurance policies as a 

countable resource for LIS 

determinations. However, under the SSI 

resource methodologies described in 

section 1613(a) of the Act, which 

applies to MSP-related resource 

eligibility determinations per section 

1905(p)(1)(C) of the Act, the cash 

surrender value of life insurance with a 

total face value exceeding $1,500 is 

countable. 

As discussed in the proposed rule at 

87 FR 54768, obtaining documentation 

of a life insurance policy’s cash 

surrender value can be highly 

burdensome for applicants, as the cash 

surrender value is not knowable from 

the documents a policyholder is likely 

to have. 

Under proposed § 435.952(e)(4)(i), if 

an individual attests to having a life 

insurance policy with a face value 

below $1,500, States must accept the 

attested face value for purposes of 

making an initial eligibility 

determination for MSP coverage, unless 

the State has information that is not 

reasonably compatible with attested 

information. If the total face value of all 

of an individual’s life insurance policies 

does not exceed $1,500, the cash 

surrender value of the individual’s 

policies is not counted in determining 

MSP eligibility pursuant to sections 

1613(a)(16) and 1905(p)(1)(C) of the Act. 

Under proposed § 435.952(e)(4)(i)(A), 

if an individual attests to having a life 

insurance policy with a face value in 

excess of $1,500, consistent with current 

regulations at § 435.948, States may 

accept the attested cash surrender value. 

In both cases, if the State has 

information that is not reasonably 

compatible with the attested face value 

or cash surrender value of the policy, 

we proposed at § 435.952(e)(4)(ii) that 

the State must seek additional 

information from the individual in 

accordance with § 435.952(c)(2). Per 

current § 435.952(c)(2), the agency may 

accept a reasonable explanation from 

the applicant or require documentation. 

As with interest and dividend 

income, per proposed 

§ 435.952(e)(4)(iii), States would have 

the option to conduct post-enrollment 

verification for individuals enrolled 

based on an attested face value. In 

conducting post-enrollment verification, 

if a State determines that the face value 

of the policy exceeds $1,500, then the 

State must seek the cash surrender value 

on behalf of the individual in 

accordance with proposed 

§ 435.952(e)(4)(iv)(A) and take 

appropriate action, consistent with 

regulations relating to changes in 

circumstances at § 435.916(d) (which we 

proposed to redesignate and revise at 

§ 435.919 in the proposed rule). 

We also proposed at 

§ 435.952(e)(4)(iv)(A) that when 

documentation of the cash surrender 

value of a life insurance policy is 

required, the State must assist the 

individual with obtaining this 

information and documentation by 

requesting that the individual provide 

the name of the insurance company and 

policy number and authorize the State 


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to obtain such documentation on the 

individual’s behalf. The agency may 

also request, but may not require, 

additional information from the 

applicant to assist the agency in 

obtaining documentation of the cash 

surrender value, such as the name of an 

agent. If the individual does not provide 

basic information about the policy and 

an authorization, under proposed 

§ 435.952(e)(4)(iv)(B), the State may 

require that the individual provide 

documentation of the cash surrender 

value. Under proposed 

§ 435.952(e)(4)(iv)(C), the State must 

provide the individual with at least 15 

calendar days to provide such 

documentation if required pursuant to 

paragraph (e)(4)(i) or (ii) of this section 

(that is, if documentation of the cash 

surrender value is needed prior to the 

agency’s making a determination of 

eligibility) and at least 90 calendar days 

if required pursuant to paragraph 

(e)(4)(iii) of this section (that is, postenrollment). We note that the minimum 

of 15 calendar days in proposed 

§ 435.952(e)(4)(iv)(C) for applicants to 

provide documentation of cash 

surrender value of a life insurance 

policy is consistent with the minimum 

15 calendar days that we propose States 

must generally provide applicants to 

provide required documentation under 

proposed § 435.907(d). 

We sought comment on whether 15 

calendar days or a longer minimum 

period, such as 20 calendar days or 30 

calendar days, appropriately balances 

the complexity of determining and 

obtaining documentation of the cash 

surrender value with the 45-day limit 

for States to complete Medicaid 

eligibility determinations for 

individuals applying on a basis other 

than disability status under 

§ 435.912(c)(3). 

In the proposed rule (87 FR 54768 

through 54769), we acknowledged that 

our proposal would represent a 

significant change for a number of States 

and could present some administrative 

challenges to implement. However, 

documenting the cash surrender value 

of life insurance is a considerable 

hurdle for many applicants. Because the 

cash surrender value of most applicants’ 

policies is likely very modest, we noted 

that the value of any life insurance 

policy likely would have a minimal 

impact on their financial eligibility for 

coverage, whereas obtaining 

documentation of the cash surrender 

value may pose a substantial 

administrative barrier to access. 

Implementing a process that places 

fewer burdens on applicants is in the 

interest of efficient administration of the 

program, consistent with section 

1902(a)(4) of the Act. We also expected 

that States would be better able to 

navigate obtaining such documentation 

when needed. 

We received comments on our 

proposals related to life insurance, and 

our responses follow. 

Comment: Many commenters 

provided feedback on the proposals to 

streamline verification processes for life 

insurance. Some commenters supported 

the provision, agreeing with CMS that 

the need to verify the cash value of a life 

insurance policy is an extremely 

challenging hurdle for many MSP 

applicants. One commenter noted that 

obtaining a letter from the insurer 

providing cash value can take weeks 

and often longer and noted that finding 

the right contact can be challenging 

because many insurers have closed their 

businesses or merged or transferred 

portions of their insurance portfolios to 

other companies. Several commenters 

agreed with the proposal to shift the 

burden to States to verify the cash 

surrender value, concurring that States 

were in a better position to gather the 

information due to the demographics of 

the applicants and the complexities of 

tracking down the information. A 

commenter recommended that to obtain 

authorization from the applicant to 

reach out to the insurer, States should 

inform the individual of the reason for 

obtaining the information and that they 

will safeguard the information. A few 

commenters, while supporting the 

overall proposal, recommended that 

CMS extend the deadline for providing 

documentation to 20 to 30 days for 

individuals who must produce 

documentation after refusing to give 

consent to States to contacting life 

insurance companies. However, the 

commenters added that their primary 

concern is to avoid a requirement that 

impedes States from meeting the 45-day 

timeline for making eligibility 

determinations. 

Other commenters opposed our 

proposal to shift the burden to States to 

verify the cash surrender value of life 

insurance, citing concerns that it would 

increase work for eligibility workers and 

that insurance companies may refuse to 

disclose this information to anyone 

except the life insurance policy holder 

or their authorized representative. One 

commenter stated that this burden 

shifting was unnecessary and their State 

already provides help with obtaining 

the cash surrender value to any 

individual who requests such 

assistance. 

Response: We believe that our 

proposal appropriately balances the 

interests of low-income older adults and 

individuals with disabilities with the 

needs and resources of States. At the 

outset, we note that we anticipate the 

life insurance provisions will affect only 

a very small number of people. 

Applicants for MSPs tend to be lowincome individuals who do not have 

many assets, especially if they have 

income low enough to qualify for the 

MSPs. Additionally, as discussed 

previously in this final rule, the most 

popular form of life insurance for lower 

income individuals, term life insurance, 

is not impacted by these proposals. 

Moreover, as noted previously in this 

final rule, several States have eliminated 

the asset test for the MSPs, while others 

have raised the asset limit to $10,000 or 

more for life insurance policies. 

In response to concerns about shifting 

the burden of verifying the cash 

surrender value of life insurance from 

individuals to States, we note that States 

can avoid this burden by simply 

disregarding life insurance as an asset or 

increasing the limit using authority 

under section 1902(r)(2) of the Act. 

Additionally, this policy is similar to 

the support that SSA provides. While 

commenters have stated that they prefer 

individuals have 30 days to provide life 

insurance documentation, we are 

doubtful that States will be able to 

process MSP applications in 45 days 

while providing 30 days to produce 

documents. As such, we believe 15 days 

strikes the more appropriate balance. 

In response to the commenter’s 

suggestion to require States to inform 

applicants that their personal 

information will be properly 

safeguarded when the State requests 

authorization to contact the applicant’s 

life insurance company, we note that 

States are required to safeguard 

information about applicants and 

beneficiaries obtained or used to verify 

eligibility in accordance with 42 CFR 

431, subpart F. States must publicize 

their policies governing the confidential 

nature of information about applicants 

and beneficiaries, including the legal 

sanctions imposed for improper 

disclosure and use, as well as provide 

copies of these policies to applicants 

and beneficiaries and to other persons 

and agencies to whom information is 

disclosed in accordance with § 431.304. 

In this context, States would be required 

to provide a copy of the State’s policies 

related to confidentiality of information 

to the applicant and to any 

representative of the applicant’s 

insurance company to whom applicant 

information may be disclosed during the 

verification process. We decline to make 

a new, more specific requirement, 

because we believe States should have 

flexibility with regard to how they 

implement this requirement. 


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After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal on life insurance, with a 

modified compliance date of April 1, 

2026. 

In-Kind Support and Maintenance. Inkind support and maintenance is 

assistance an applicant receives that is 

paid for by someone else, such as 

groceries or utilities paid for by an adult 

child. Section 1860D–14(a)(3)(C)(i) of 

the Act, added by section 116 of MIPPA, 

excludes in-kind support and 

maintenance as countable income for 

LIS determinations. Under SSI 

methodologies at 20 CFR 416.1131, 

which apply to MSP determinations, the 

value of in-kind support and 

maintenance, if both food and shelter 

are received by an applicant, is 

presumed to be one-third of the Federal 

benefit rate ($914 per month in 2023 for 

a single person), unless the applicant 

provides documentation demonstrating 

a different amount. 

We did not propose any changes to 

regulations relating to in-kind support 

and maintenance, but we sought 

comment on whether obtaining 

documentation to rebut the one-third 

presumption poses a barrier to 

eligibility and whether we should 

require States to accept self-attestation 

from individuals who seek to rebut a 

presumption of the amount of in-kind 

support and maintenance they receive 

subject to post-enrollment verification. 

We received the following comments 

on in-kind maintenance and support, 

and our responses follow. 

Comment: A commenter requested 

that CMS require States to accept selfattestation for individuals seeking to 

rebut the presumption of the amount of 

in-kind support and maintenance they 

receive, while another commenter 

requested that CMS make this an option 

for States. However, we did not receive 

any other specific feedback on this 

proposal. 

Response: As we discussed in the 

proposed rule (87 FR 54769), States may 

already exercise the option of accepting 

self-attestation for individuals seeking 

to rebut the presumption of the amount 

of in-kind support and maintenance 

they receive. Alternatively, States can 

further streamline the MSP eligibility 

and enrollment process for individuals 

with in-kind maintenance and support 

by disregarding in-kind support and 

maintenance entirely under section 

1902(r)(2) of the Act. While we decline 

to adopt specific requirements regarding 

requiring self-attestation for in-kind 

maintenance and support at this time, 

we will consider this input for future 

rulemaking. 

Streamlined Methodologies for Other 

Non-MAGI and MAGI Groups. Our 

proposals requiring States to apply 

enrollment simplifications to income 

and resources that are counted for MSP 

determinations but not for LIS only 

apply to MSPs. However, we sought 

comment on extending these proposals 

to all individuals seeking eligibility on 

a non-MAGI basis. We also sought 

comment on extending the proposal 

relating to verification of dividend and 

interest income to individuals seeking 

eligibility based on MAGI, as well as 

whether there are additional income or 

resource types to which the proposals 

below could be extended for all 

individuals. 

We received the following comments, 

and our responses follow. 

Comment: Some commenters opposed 

applying the proposed MSP 

requirements to all non-MAGI 

populations. Some others supported this 

concept, maintaining that applying 

uniform standards across eligibility 

groups would help promote clarity for 

applicants and enhance the utility of 

leads data for screening other bases of 

eligibility. A commenter noted that 

documentation barriers apply equally to 

these other non-MAGI groups and the 

need to simplify the processes for these 

other groups are just as urgent. A few 

commenters supported applying the 

income and dividend interest selfattestation requirements to MAGI 

groups. 

A commenter requested clarification 

on whether extending the exclusion of 

these income types using flexibility 

afforded in section 1902(r)(2) of the Act 

would extend to post-eligibility 

treatment of income (PETI), which 

involves how income is counted for 

beneficiaries in a medically needy 

eligibility group, or if it would be 

similar to how Veterans Affairs’(VA) 

Aid and Attendance is treated (excluded 

for eligibility, included in PETI). 

Response: We appreciate the 

comments and will consider them for 

future rulemaking. With respect to the 

commenter’s request for clarifications 

about whether income disregards under 

section 1902(r)(2) of the Act apply to 

post-eligibility treatment of income 

(PETI) calculations, we confirm that any 

income excluded in an eligibility 

determination using section 1902(r)(2) 

of the Act must be counted in the PETI 

calculation. In the post-eligibility 

process, income includes all amounts of 

income available to an individual from 

all sources that are considered income 

for purposes of underlying eligibility, 

even if such income is disregarded at 

the eligibility determination phase using 

section 1902(r)(2) authority. Only 

income which is expressly exempted 

from post-eligibility calculations under 

Federal law would not be included in 

the post-eligibility process. However, 

we note that the current proposal does 

not make any changes to how States 

may use section 1902(r)(2) authority. 

Comment: Several commenters 

expressed support for the proposed 

changes to facilitate enrollment through 

Medicare Part D LIS leads data in 

§§ 435.4, 435.601, 435.911, and 435.952 

but provided feedback on areas that 

were not addressed in the proposed 

rule. For example, a commenter 

requested that the definition of 

‘‘retirement funds’’ for the LIS program 

be aligned with the SSI and Medicaid 

programs to exclude retirement funds 

that are in distribution status. Another 

commenter recommended several ways 

that CMS could leverage Area Agencies 

on Aging and SHIPs and other 

enrollment assistance providers to 

streamline the MSP application process, 

such as requiring States to allow such 

entities to access State eligibility 

systems and manage and submit data 

and verifications on behalf of 

applicants. In addition, a commenter 

recommended that CMS facilitate access 

to other public benefits, including by 

helping to create a combined 

application for Medicaid coverage and 

other benefits. A commenter 

recommended that CMS encourage 

States to share data with the Indian 

health care system, specifically Indian 

Health Services, Tribal, and Urban 

Indian Organizations. Another 

commenter urged CMS to improve MSP 

outreach to eligible individuals, for 

example, by updating CMS MSP 

outreach templates to allow States to 

enter their own income and asset limits 

and provide the contact information of 

the SHIP counselor. This commenter 

further recommended that CMS 

incentivize States to remove language 

access barriers for persons with limited 

English proficiency. A few commenters 

recommended that CMS consider 

further linkages between Medicaid 

applications and other social services. 

Another commenter sought clarification 

about whether an individual for whom 

the State had accepted self-attestation, 

but was later deemed ineligible would 

be treated as ‘‘enrolled’’ in Medicaid for 

purposes of the continuous enrollment 

condition under the Families First 

Coronavirus Response Act (FFCRA) 

(Pub. L. 116–127, enacted March 18, 

2020) or any subsequent continuous 

enrollment conditions or requirements. 

Response: These areas are outside the 

scope of this rulemaking. With respect 


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35Memorandum from Director, Center for 

Medicaid and State Operations, to Regional 

Administrator, re: Medicaid Eligibility—Policy 

Governing Family Size in Determining Eligibility 

for Qualified Medicaid Beneficiaries and Specified 

Low-Income Beneficiaries. October 2, 1997. https:// 

www.medicaid.gov/sites/default/files/2019-12/ 

medicaid-eligibilty-memo.pdf. 

36Centers for Medicare & Medicaid Services, 

Guidance to States on the Low-Income Subsidy, 

section 30.6 (Family Size), February 2009. https:// 

www.cms.gov/Medicare/Eligibility-and-Enrollment/ 

LowIncSubMedicarePresCov/downloads/ 

StateLISGuidance021009.pdf. 

to the question about the continuous 

eligibility condition under the FFRCA, 

we note that this provision expired on 

March 31, 2023. 

2. Define ‘‘Family of the Size Involved’’ 

for the Medicare Savings Program 

Groups Using the Definition of ‘‘Family 

Size’’ in the Medicare Part D LowIncome Subsidy Program (§ 435.601) 

To further facilitate alignment of 

methodologies used to determine 

eligibility for the Medicare Part D LIS 

and MSP groups and facilitate 

enrollment in the MSPs based on LIS 

data, we proposed to amend § 435.601 

(‘‘Application of financial eligibility 

methodologies’’) to create a new 

paragraph (e), in which we proposed to 

define ‘‘family size’’ for purposes of 

MSP eligibility. 

As discussed in the proposed rule at 

87 FR 54770, the Act sets out income 

limits for MSP enrollment relative to the 

Federal poverty level (FPL) ‘‘applicable 

to a family of the size involved.’’ The 

statute does not define the phrase 

‘‘family of the size involved’’ and CMS 

has historically permitted States to 

apply their own reasonable definition of 

this phrase.35

However, in light of the various 

statutory provisions to facilitate 

enrollment of LIS recipients into MSPs 

and vice versa, it is appropriate to 

establish Federal standards governing 

the phrase ‘‘family of the size involved.’’ 

Specifically, we proposed for 

purposes of determining eligibility for 

the MSP groups, consistent with our 

authority under section 1902(a)(4) of the 

Act to facilitate methods of 

administration that promote the proper 

and efficient administration of the 

Medicaid program, that ‘‘family of the 

size involved’’ be defined to include at 

least the individuals included in the 

definition of ‘‘family size’’ in the LIS 

program. Under § 423.772 

(‘‘Definitions’’ relating to the LIS 

program), ‘‘family size’’ is defined to 

include the applicant, the applicant’s 

spouse (if the spouse is living in the 

same household with the applicant), 

and all other individuals living in the 

same household who are related to the 

applicant and dependent on the 

applicant or applicant’s spouse for onehalf of their financial support. 

By proposing that a State’s definition 

of ‘‘family of the size involved’’ include 

‘‘at least’’ the individuals described in 

§ 423.772 for purposes of the MSP 

groups, States would retain flexibility to 

include other individuals who are not 

described in § 423.772. Additionally, 

this proposal would not affect the 

States’ ability to adopt a different 

reasonable definition of the phrase for 

purposes of other eligibility groups. We 

sought comment on this proposal to 

define ‘‘family of the size involved’’ for 

purposes of the MSP groups. 

We received the following comments 

on our proposals related to family size, 

and our responses follow. 

Comment: Many commenters 

supported aligning the definitions of 

family size for MSP with LIS. A number 

of these commenters specifically noted 

that communities of color and 

marginalized individuals were more 

likely to be part of multi-generational 

households. For that reason, they 

indicated this change would better 

reflect the household composition of 

low-income Medicare beneficiaries and 

promote health equity. MACPAC 

supported this proposal, noting 

consistency with its 2020 

recommendations to Congress to align 

the family size definition for the MSPs 

and LIS. 

A few commenters, while supporting 

the proposed change, requested specific 

modifications or clarifications. A 

commenter requested that CMS clarify 

in the regulation or commentary to the 

regulation that ‘‘relative’’ includes 

anyone related by blood, marriage, or 

adoption based on 2009 CMS LIS 

guidance to States. The commenter 

further indicated that a particular State 

only counts the spouse in the household 

size if the individual’s income is below 

the MSP income limit and requested 

that CMS issue a directive to States to 

clarify this is not allowed. 

Response: We thank the commenters 

for their support regarding our proposed 

MSP-related family size definition and 

agree that these provisions would 

promote health equity and increase 

access to the MSPs. 

The definition of ‘‘family size’’ in 

§ 423.772 includes the spouse of an 

applicant who is living in the same 

household. We therefore confirm that 

the requirement under the proposed 

rule that States use the definition of 

‘‘family size’’ in § 423.772 to determine 

MSP eligibility means that States would 

necessarily include an applicant’s 

spouse in the applicant’s family, if the 

spouse is living in the same household. 

We note, however, that, while being 

required to include the spouse in the 

applicant’s household, States could 

exclude the spouse’s income and/or 

resources in the applicant’s MSP 

eligibility determination. As noted 

previously in this final rule, States may, 

under the authority of section 

1902(r)(2)(A) of the Act, utilize 

methodologies less restrictive than the 

SSI program in determining MSP 

eligibility, which includes the authority 

to disregard otherwise-countable 

income and/or resources, such as the 

income and/or resources of a spouse. 

With regard to what constitutes a 

relative for purposes of the ‘‘family 

size’’ definition in § 423.772, as the 

commenter noted, in 2009 CMS 

previously confirmed for States that the 

LIS ‘‘family size’’ definition includes 

the applicant, the applicant’s spouse (if 

living with the applicant), and ‘‘[a]ny 

persons who are related by blood, 

marriage, or adoption, who are living 

with the applicant and spouse and who 

are dependent on the applicant or 

spouse for at least one half of their 

financial support’’ 36 (emphasis added). 

Consistent with this guidance, we 

confirm that to comply with the 

proposed rule to use the ‘‘family size’’ 

definition in § 423.772 for MSP 

eligibility determinations, States would 

at least need to treat as ‘‘related to’’ the 

applicant individuals who are related by 

blood, marriage, or adoption. As noted 

previously in this final rule, however, 

States would retain the authority under 

the proposed rule to include individuals 

who are not required to be included in 

the definition of a ‘‘family of the size 

involved’’ for their MSP-related 

eligibility determinations. We intend to 

consider providing future guidance to 

States to further clarify this 

requirement. 

Comment: Some commenters shared 

concerns with the proposal to apply the 

LIS family size definition to the MSPs. 

For example, some commenters 

requested more time to complete 

systems changes and other updates (for 

example, SPAs) to implement the 

proposal, and a few commenters 

opposed the changes as overly 

burdensome and costly for States 

because it would require different 

eligibility and enrollment processes for 

the MSPs than for other non-MAGI 

groups. Further, some commenters 

suggested that extending the LIS family 

size definition to the MSPs could have 

an unintentional negative impact on 

current MSP enrollees if additional 

income from the relative/dependent is 

deemed to them, making them no longer 

eligible for the MSPs. Finally, some 


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65248 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

37https://www.ssa.gov/dataexchange/documents/ 

LIS%20record.pdf. 

38States with buy-in agreements must exchange 

buy-in enrollment data with CMS on a daily basis 

under § 407.40(c)(4), and CMS also exchanges buyin data with SSA on a daily basis. CMS collectively 

refers to these data exchange processes as the ‘‘buyin data exchange.’’ See Manual for the State 

Payment of Medicare Premiums, chapter 2, sections 

2.0 and 2.1. https://www.cms.gov/files/document/ 

chapter-2-data-exchange-processes.pdf. 

commenters indicated that States may 

not have information about minor 

members of household and may find it 

difficult to verify dependency of nonminor household members. A few 

commenters questioned whether this 

information about household members 

outside of the spousal unit is contained 

in the LIS leads data transmitted. 

Response: We acknowledge that these 

changes may require many 

programmatic updates (including SPAs) 

and systems changes. As such, we are 

extending through this final rule the 

timeline for States to comply with this 

provision. 

Regarding the concern about the 

deeming to MSP applicants or enrollees 

the income of relatives or dependents, 

we note that preexisting non-MAGI 

deeming rules, under section 

1902(a)(17)(D) of the Act and 

§ 435.602(a)(2)(i), prohibit States from 

deeming to an applicant the income or 

resources of anyone who is not the 

spouse or parent of that individual. 

Thus, although the proposal to use the 

definition of ‘‘family size’’ under 

§ 423.772 to determine MSP-related 

eligibility may increase the family size 

of MSP applicants and enrollees, it will 

not expand the individuals whose 

income and/or resources may be 

deemed available to an MSP applicant 

or enrollee, as the non-MAGI deeming 

rule described in section 1902(a)(17)(D) 

of the Act and § 435.602(a)(2)(i) 

continues to apply. 

Finally, we clarify that because the 

LIS definition of family size includes 

dependent relatives residing in the same 

house, SSA collects information to 

determine the number of relative 

dependents living in the household, 

excluding the beneficiary and spouse, 

and includes it in the LIS leads data sent 

to States.37 Again, as mentioned 

throughout, we plan to provide 

technical assistance and guidance to 

States to help them understand and use 

LIS leads data information for MSP 

eligibility determinations. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal at § 435.601 on family size, 

with a modified compliance date of 

April 1, 2026. 

3. Automatically Enroll Certain SSI 

Recipients Into the Qualified Medicare 

Beneficiaries Group (§ 435.909) 

SSI is a Federal cash assistance 

program that serves low-income 

individuals who are age 65 or older, or 

have blindness or a disability. SSI 

recipients typically qualify for other 

Federal and State programs. For 

example, many SSI recipients are 

entitled to Medicare under § 406.5(a) 

and (b). Additionally, in most States, the 

receipt of SSI is a mandatory basis for 

Medicaid eligibility pursuant to section 

1902(a)(10)(A)(i)(II)(aa) of the Act, 

implemented at § 435.120 (‘‘Individuals 

receiving SSI group,’’ hereafter the 

‘‘mandatory SSI group’’). 

Thirty-three States and the District of 

Columbia (DC) that cover the mandatory 

SSI group have an agreement with SSA 

under section 1634(a) of the Act under 

which SSA completes the determination 

of eligibility for the mandatory SSI 

group, and the Medicaid agency 

automatically enrolls the individual in 

Medicaid. We commonly refer to these 

States as ‘‘1634 States.’’ Nine States that 

cover the mandatory SSI group apply 

the SSI program’s income and resource 

methodologies and disability criteria but 

require individuals to submit a separate 

application to the State Medicaid 

agency (‘‘criteria States’’). 

Eight States do not cover the 

mandatory SSI group. Instead, these 

States have elected to exercise authority 

provided to them under section 1902(f) 

of the Act to apply financial 

methodologies and/or disability criteria 

more restrictive than the SSI program in 

determining eligibility for individuals 

65 years old or older or who have 

blindness or a disability, subject to 

certain conditions. These States are 

referred to as ‘‘209(b) States,’’ after the 

provision of section 209(b) of the Social 

Security Act Amendments of 1972 (Pub. 

L. 92–603), which enacted the State 

authority codified at section 1902(f) of 

the Act. The eligibility group authorized 

by section 1902(f) of the Act is 

implemented at § 435.121 (‘‘Individuals 

in States using more restrictive 

requirements for Medicaid than the SSI 

requirements,’’ hereafter ‘‘mandatory 

209(b) State group’’). 

As discussed in the proposed rule at 

87 FR 54771, because the income and 

resource standards for the QMB group 

exceed the income and resource 

standards for SSI, individuals entitled to 

Medicare Part A who meet the income 

and resource requirements for the 

mandatory SSI group or mandatory 

209(b) group will always meet the 

income and resource requirements for 

the QMB group and be eligible for the 

QMB group. 

As discussed at 87 FR 54771, most 

individuals enrolled in Medicare qualify 

for Part A without paying a premium 

(premium-free Part A) and are 

automatically enrolled. According to 

internal SSA and CMS data, in 2022, 

approximately 2.8 million individuals 

(over 75 percent) of Medicare-eligible 

SSI recipients were entitled to 

premium-free Part A. 

Under § 406.20, many individuals 

who are not eligible for premium-free 

Part A may still enroll in Part A by 

applying for benefits at SSA and paying 

a premium (‘‘premium Part A’’). 

Individuals who are not eligible for 

premium-free Part A are not 

automatically enrolled in premium Part 

A and they must enroll in Part B prior 

to or at the same time as they enroll in 

Part A. For all Medicare beneficiaries, 

enrollment in Part B is contingent on a 

monthly premium, which is subject to 

an adjustment based on income. 

All States currently have entered into 

a voluntary ‘‘buy-in agreement’’ with 

the Secretary authorized under section 

1843 of the Act which requires them to 

pay the Part B premiums for certain 

Medicaid beneficiaries known as ‘‘(Part 

B buy-in’’), including individuals 

enrolled in the QMB group and those 

receiving SSI (as described in the 

Medicare regulations at § 407.42). A 

buy-in agreement permits States to 

directly enroll eligible individuals in 

Medicare Part B at any time of the year 

(without regard to Medicare enrollment 

periods or late enrollment penalties if 

applicable) and to pay the Part B 

premiums on the individual’s behalf. 

In 1634 States, when SSA determines 

an individual eligible for both the 

mandatory SSI group and Medicare Part 

B, CMS automatically initiates Part B 

buy-in for the individual.38 In SSI 

criteria and 209(b) States, SSA notifies 

both the State and CMS that an 

individual has been determined eligible 

for SSI and Medicare Part B; however, 

because such individuals must submit a 

separate Medicaid application for 

determinations of eligibility, we do not 

automatically initiate Part B buy-in. 

Rather, once the State determines an 

individual eligible for the mandatory 

SSI or 209(b) group, the State must 

initiate Part B buy-in for the individual 

pursuant to its buy-in agreement. 

While individuals enrolled in the 

mandatory SSI or 209(b) group receive 

full Medicaid benefits and Part B buyin, enrollment in the QMB group 

provides these individuals with 

additional protection from out-of-pocket 

health care costs—specifically Medicare 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65249 

39 Individuals who are entitled to premium-free 

Part A are eligible to enroll in Medicare Part B 

under § 407.10(a)(1). 

Part A premiums, if applicable, and 

Parts A and B cost-sharing charges. 

Moreover, Federal law prohibits all 

Medicare providers and suppliers, not 

just those participating in Medicaid, 

from charging QMBs for Medicare costsharing. 

Maximizing the number of Medicaid 

beneficiaries who are also enrolled in 

Medicare is advantageous to such 

individuals, and it can also result in 

cost savings for States. As a third-party 

payer, Medicare pays primary to 

Medicaid for Medicare Part A (inpatient 

hospital and skilled nursing facility 

services) and Medicare Part B 

(outpatient medical care). In addition, 

Medicaid beneficiaries who are enrolled 

in both Medicare Parts A and B may join 

Medicare-Medicaid integrated care 

plans, which coordinate care across the 

two payers and may generate savings to 

the State by helping beneficiaries avoid 

institutional placement and by 

providing supplemental benefits, such 

as dental, transportation, hearing, or 

other benefits that otherwise would 

have been covered by Medicaid. 

Despite the potential benefits for 

Medicaid beneficiaries and State 

agencies, our data from 2022 indicates 

that over 500,000 or 16 percent of SSI 

recipients who are eligible to enroll in 

Medicare are not enrolled in the QMB 

eligibility group. It is our understanding 

that a major barrier to QMB enrollment 

is that many States require SSI 

recipients to file a separate application 

with the State Medicaid agency to be 

evaluated for eligibility for the QMB 

group, even though they have been 

determined eligible for the mandatory 

SSI or 209(b) groups, and all SSI 

recipients who are entitled or able (with 

a premium) to enroll in Part A 

necessarily meet the requirements for 

QMB eligibility. 

We proposed several changes to 

facilitate the enrollment of SSI 

recipients into the QMB eligibility 

group, consistent with our authority in 

section 1902(a)(4) of the Act to establish 

standards promoting the proper and 

efficient administration of the Medicaid 

program, the requirements in the 

January 28, 2021 Executive Order on 

Strengthening Medicaid and the 

Affordable Care Act, the April 5, 2022 

Executive Order on Continuing to 

Strengthen Americans’ Access to 

Affordable, Quality Health Coverage, 

and the December 13, 2021 Executive 

Order on Transforming Federal 

Customer Experience and Service 

Delivery to Rebuild Trust in 

Government. Specifically, we proposed 

to add a new paragraph (b) at § 435.909 

that generally would require States to 

deem an individual enrolled in the 

mandatory SSI or 209(b) group eligible 

for the QMB group the month the State 

becomes responsible for paying the 

individual’s Part B premiums under its 

buy-in agreement pursuant to 

§ 407.47(b). We also proposed technical 

changes to remove reserved paragraph 

(a) at § 435.909, redesignate § 435.909 

paragraph (b) as (a), and add a new 

header to new § 435.909(a). 

We noted (87 FR 54772) that under 

section 1902(e)(8) of the Act, QMB 

eligibility is effective the month 

following the month in which the 

determination of eligibility for the QMB 

group is made. Thus, under our 

proposal, QMB coverage would start the 

month following the month the State 

deems an individual eligible for the 

QMB group and starts paying the 

individual’s Part B premiums under the 

buy-in agreement. For example, if an 

individual is first enrolled in both the 

mandatory SSI or 209(b) Medicaid 

group and entitled to Part A in January 

2025, the State would start paying the 

individual’s Part B premiums under the 

buy-in agreement and deem the 

individual eligible for the QMB group in 

January 2025. The individual’s QMB 

coverage would start February 1, 2025. 

SSI Recipients Who Have Premium-Free 

Medicare Part A 

As noted at 87 FR 54771, SSA 

automatically enrolls individuals who 

receive Social Security or railroad 

retirement benefits or disability benefits 

for 24 months into premium-free Part A. 

SSA data for States (including those 

with a 1634 agreement and those 

without a 1634 agreement) indicates 

whether an SSI recipient is entitled to 

premium-free Part A. As discussed 

previously in this final rule, because all 

SSI recipients meet the financial 

eligibility requirements for the QMB 

group, proposed § 435.909(b)(1)(i) 

would require all States to deem SSI 

recipients who are determined eligible 

for either the mandatory SSI group at 

§ 435.120 or the mandatory 209(b) group 

at § 435.121 as eligible for the QMB 

group if they are entitled to premiumfree Medicare Part A. Under the 

proposed rule, when a 1634 State 

receives from CMS the Part B buy-in 

enrollment for an SSI recipient who is 

entitled to premium-free Medicare Part 

A, the State would automatically enroll 

the individual in both the mandatory 

SSI group and the QMB group; such 

individuals would not be required to 

submit a separate application to the 

Medicaid agency to determine eligibility 

for the QMB group. 

SSI recipients in criteria States and 

209(b) States must submit a separate 

application to the Medicaid agency 

which determines eligibility for either 

the mandatory SSI or the 209(b) group. 

Thus, under proposed § 435.909(b)(1)(i), 

once the State has determined an SSI 

recipient eligible for the mandatory SSI 

or the 209(b) group, the State also would 

start paying the Part B premiums for the 

individual the first month they are 

entitled to Part A and receiving SSIbased Medicaid and start QMB group 

coverage the first day of the following 

month. 

In some instances, individuals 

enrolled in the mandatory SSI or 209(b) 

group become retroactively entitled to 

premium-free Medicare Part A based on 

a retroactive award of Social Security 

Disability Insurance (SSDI). Under the 

Medicare regulations at § 407.47(b), 

States generally become responsible for 

retroactive Part B premiums for such 

individuals dating back to the first 

month they were enrolled in the 

mandatory SSI or 209(b) group and 

eligible for Part B.39 In the proposed 

rule entitled, ‘‘Implementing Certain 

Provisions of the Consolidated 

Appropriations Act and other Revisions 

to Medicare Enrollment and Eligibility 

Rules’’ (87 FR 25090) (referred to 

hereafter as the ‘‘2022 Medicare 

eligibility and enrollment proposed 

rule’’), we proposed adding a new 

paragraph (f) at § 407.47 to limit State 

liability for retroactive Part B premiums 

for full-benefit Medicaid beneficiaries, 

including individuals receiving SSIbased Medicaid, to a period of no 

greater than 36 months prior to the date 

of the Medicare enrollment 

determination. 

In the proposed rule, we proposed at 

§ 435.909(b)(3) that retroactive QMB 

coverage for individuals in the 

mandatory SSI or 209(b) group be 

limited to the same period for 

retroactive Part B premium liability that 

was set forth in the then-proposed 

§ 407.47(f), which we have now 

finalized (to take effect starting January 

1, 2024) in the 2022 Medicare eligibility 

and enrollment final rule. For example, 

if SSA determines an individual 

enrolled in the mandatory SSI or 209(b) 

group eligible for premium-free Part A 

in January 2025 with an effective date 

back to January 2023, the State would 

deem the individual eligible for the 

QMB group retroactive to January 2023. 

Because coverage under the QMB group 

begins the month after the month of the 

eligibility determination, QMB coverage 

in this example would be effective 

February 1, 2023. Alternatively, if SSA 

determines an individual enrolled in the 


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65250 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

40See for example, CMS Office of Burden 

Reduction & Health Informatics, ‘‘Navigating the 

Medicare Savings Program (MSP) Eligibility 

Experience’’ April 2022. https://www.cms.gov/files/ 

document/navigatingmedicare-savings-programmsp-eligibilityexperience-journey-map.pdf. 

mandatory SSI or 209(b) group eligible 

for premium-free Part A in January 2025 

with an effective date back to January 

2021, the State would deem the 

individual eligible for the QMB group 

retroactive to January 2022, with QMB 

coverage effective February 1, 2022. 

Additionally, at 87 FR 54772, we 

reminded States that individuals 

deemed eligible for Medicaid are not 

exempt from regularly-scheduled 

renewals of Medicaid eligibility in 

accordance with § 435.916. However, 

1634 agreement States do not need to 

take affirmative steps to renew Medicaid 

for individuals who continue to receive 

SSI. Such individuals remain eligible 

for Medicaid based on their continued 

receipt of SSI. 1634 States can rely on 

information electronically transmitted 

by SSA (for example, the State Data 

Exchange (‘‘SDX), State Verification 

Exchange System (SVES), or State 

Online Query System (SOLQ)), to renew 

on an ex parte basis, individuals who 

continue to receive SSI. States may 

consider SSA’s original notification 

identifying an SSI recipient as 

verification that the individual is still 

receiving SSI and eligible for Medicaid 

on that basis until the State receives 

new information from SSA reflecting a 

change in circumstances. However, for 

an individual eligible under both the 

mandatory SSI and QMB groups, the 

State need only verify that the 

individual still receives SSI and is 

entitled to Medicare Part A to renew 

their eligibility in both groups. When an 

individual no longer meets the 

eligibility requirements for the 

eligibility group under which they have 

been receiving coverage, the State must 

determine eligibility on all bases before 

terminating eligibility. 

We received the following comments, 

and our responses follow. 

Comment: Several commenters 

expressed support for our proposal at 

§ 435.909(b)(1) to require States to 

automatically enroll most SSI recipients 

in the QMB group as they are by 

definition eligible for this coverage. 

MACPAC stated that the proposal aligns 

with its goal of improving participation 

in the MSPs and, from a health equity 

perspective, could promote access to 

care for the lowest-income Medicare 

beneficiaries by improving their access 

to Medicare cost-sharing assistance. 

Similarly, some commenters anticipated 

that our proposal would substantially 

boost MSP enrollment for SSI recipients 

because procedural barriers to the MSPs 

have an outsize impact on this 

population, who are among those least 

able to navigate enrollment processes 

due to multiple social risk factors and 

physical and mental disabilities. 

Finally, a few commenters indicated 

that this proposal would reduce 

administrative work for State Medicaid 

staff and thus benefit States and SSI 

recipients alike. 

Response: We agree that requiring 

automatic enrollment of certain SSI 

recipients in QMB is an impactful and 

efficient step to break down barriers to 

MSP enrollment and advance health 

equity for this extremely low-income, 

high-need population. 

Comment: Commenters provided 

differing perspectives about the time 

and effort needed for States to comply 

with this provision. One commenter 

noted that a certain State already has 

plans to automate QMB enrollment for 

SSI recipients in late 2023, while 

another commenter described another 

State as equipped to make system 

updates within 30 days of a final rule’s 

effective date. In contrast, one 

commenter contended that the proposal, 

particularly its creation of a limited 

retroactive QMB benefit for individuals 

who become retroactively entitled to 

premium-free Part A, may require 

changes in State law, lengthy and 

complicated systems changes, and 

employee training. 

Response: As noted in section II.A.1. 

of this final rule, we recognize that 

effectuating this change may require 

States to update to their systems and/or 

State laws, and that unique 

circumstances may affect the timeline 

by which States can make these 

changes. However, relative to other 

types of eligibility changes (such as 

implementing provisions leveraging use 

of LIS leads data discussed in section 

II.A.1. of this final rule and aligning 

non-MAGI enrollment and renewal 

requirements with MAGI requirement 

discussed in the proposed rule at 87 FR 

54780), this proposal is less likely to 

require complex and lengthy systems 

updates. Plus, we believe that since all 

SSI recipients are eligible for the QMB 

group, it is appropriate to provide 

access to this vitally important benefit 

as soon as possible. In addition, under 

all State buy-in agreements, States must 

already have mechanisms in place to 

provide a period of retroactive Part B 

buy-in for SSI recipients who become 

retroactively entitled to premium-free 

Part A based on a retroactive SSDI 

award under § 407.47(b) and (f). We 

anticipate that States would build upon 

these processes to retroactively deem 

SSI recipients into the QMB group as 

well. To balance the likelihood of 

modest systems updates and the 

benefits of our proposal, we are 

adopting a modified compliance date of 

October 1, 2024. 

Comment: One commenter agreed the 

proposal would help beneficiaries and 

States but requested clarification on 

whether SSI recipients have the option 

to decline QMB and, if so, whether 

declining QMB would affect their 

overall eligibility for Medicaid. 

Response: Under § 435.404, 

individuals who may be eligible under 

more than one category may have their 

Medicaid eligibility determined under 

the category they select. This means that 

individuals who may be eligible for 

QMB and another eligibility group may 

choose to have eligibility determined 

only under one category. Therefore, SSI 

recipients can decline eligibility for 

QMB coverage without it impacting 

their eligibility for other Medicaid 

groups. However, we note that even if 

SSI recipients eligible for the mandatory 

SSI or 209(b) group opt out of the QMB 

group, States would still pay their Part 

B premiums under their State buy-in 

agreements because this is a mandatory 

population for buy-in, and buy-in is 

involuntary. See §§ 407.40(c)(1) and 

407.42(b). Because declining QMB 

eligibility could expose these very lowincome individuals to high Medicare 

cost-sharing, we would expect very few 

SSI recipients to opt out of QMB 

eligibility. 

Additionally, while SSI recipients 

(and other individuals) may decline 

QMB enrollment without it impacting 

their Medicaid eligibility for other 

eligibility groups, they may still be 

required to apply for Medicare (if they 

have not already done so) where States 

have elected under their State plans to 

require Medicaid applicants and 

beneficiaries to apply for Medicare as a 

condition of Medicaid eligibility. 

Comment: One commenter noted that 

CMS did not provide evidence to justify 

the need for automatic enrollment and 

requested that CMS withdraw this 

proposal and instead develop a pilot 

with States to determine the reasons 

why eligible individuals do not apply 

for benefits. The commenter also 

questioned whether the proposal would 

inappropriately limit State flexibility to 

enroll SSI recipients in the medically 

needy eligibility group. 

Response: We decline the 

recommendation for a pilot project. As 

explained in the proposed rule (87 FR 

54761 through 54762), our engagement 

with States and other interested 

parties 40 as well as numerous other 


ddrumheller on DSK120RN23PROD with RULES2
Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65251 

41See, for example, MACPAC, ‘‘Improving 

Participation in the Medicare Savings Programs,’’ 

Report to Congress, June 2020. https://

www.macpac.gov/publication/chapter-3-improvingparticipation-in-the-medicare-savings-programs/; 

Office of the Assistant Secretary for Planning and 

Evaluation, Loss of Medicare-Medicaid Dual Eligible 

Status: Frequency, Contributing Factors, and 

Implications, May 8, 2019. https://aspe.hhs.gov/ 

basic-report/loss-medicare-medicaid-dual-eligiblestatus-frequency-contributing-factors-andimplications; and Caswell, Kyle J., and Timothy A. 

Waidmann, ‘‘Medicare Savings Program Enrollees 

and Eligible Non-Enrollees,’’ The Urban Institute, 

June 2017. https://www.macpac.gov/wp-content/ 

uploads/2017/08/MSP-Enrollees-and-Eligible-NonEnrollees.pdf. 

42Note that all individuals receiving title II 

benefits based on disability who have met the 24- 

month waiting period to enroll in Medicare are 

entitled to premium-free Part A. 

43To meet the requirements for premium Part A 

at § 406.20(b), the individual must be: age 65 or 

older, a U.S. resident, not otherwise entitled to Part 

A, entitled to Part B or in the process of enrolling 

in it, and a U.S. citizen or lawful permanent 

resident who has resided in the U.S. continuously 

during the 5 years immediately preceding the 

month they enrolled in Medicare. 

44See chapter 1, section 1.7 of the CMS Manual 

for the State Payment of Medicare Premiums. 

https://www.cms.gov/files/document/chapter-1- 

program-overview-and-policy.pdf. 

45See SSA Program Operations Manual System 

(POMS) HI 01001.230 Group Collection-General. 

http://policynet.ba.ssa.gov/poms.nsf/lnx/ 

0601001230. 

studies 41 have demonstrated that 

burdensome documentation 

requirements hinder the ability of 

eligible individuals to enroll in the 

MSPs and that easing these 

requirements is key to ensuring 

individuals can obtain these benefits. 

Automating QMB enrollment removes 

the need for this low-income, high-need 

population to undergo a redundant 

application process. 

Separately, we note that 209(b) States 

that have elected to extend eligibility to 

medically needy individuals under 

§ 435.330 (‘‘Medically needy coverage of 

the aged, blind, and disabled in States 

using more restrictive eligibility 

requirements for Medicaid than those 

used under SSI’’) do not have the 

flexibility to enroll SSI recipients who 

meet a spenddown in a medically needy 

group. Under section 1902(f) of the Act 

and § 435.121(e)(5), SSI recipients (and 

certain other individuals) who meet a 

spenddown based on the deduction of 

incurred medical expenses must be 

treated as categorically needy. 

Comment: Many commenters 

expressed support for the proposed 

changes but provided feedback on areas 

that were not addressed in the proposed 

rule. For example, many commenters 

requested that CMS require all States to 

automatically enroll SSI recipients in 

Medicaid coverage. One commenter 

recommended that CMS work with 

other agencies to streamline processes 

for enrolling Medicaid beneficiaries in 

other Federal benefits, when there is 

data indicating that there is a high 

likelihood that Medicaid beneficiaries 

would be eligible for those other Federal 

benefits. 

Response: We thank the commenter 

for their support of the proposed 

changes but note that these comments 

are outside the scope of this rulemaking. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal to require States to deem 

individuals enrolled in the mandatory 

SSI or 209(b) group who have premiumfree Medicare Part A as eligible for the 

QMB group under new § 435.909(b)(1), 

with a modified compliance date of 

October 1, 2024 to allow States more 

time for implementation. 

QMB Eligibility for Individuals Eligible 

for Premium Part A 

As we noted previously in this final 

rule and in the proposed rule (87 FR 

54772), individuals age 65 and over who 

lack the sufficient work history for 

premium-free Part A may qualify to pay, 

or have paid on their behalf, a monthly 

premium to receive Medicare Part A 

benefits.42 43

All States must pay the Part A 

premium for individuals who are 

enrolled in the QMB eligibility group. 

However, as discussed in the proposed 

rule at 87 FR 54773, States can choose 

one of two methods to pay the Part A 

premium for QMBs.44 First, States can 

expand their buy-in agreement with us 

under section 1818(g) of the Act to 

include enrollment and payment of Part 

A premiums for QMBs who do not have 

premium-free Part A. Currently, 36 

States and the District of Columbia have 

chosen this option and are called ‘‘Part 

A buy-in States.’’ In Part A buy-in 

States, individuals determined eligible 

for the QMB group can enroll in 

premium Part A at any time of the year 

and without regard to late enrollment 

penalties. Fourteen States do not 

include Part A in their buy-in 

agreements and instead pay the Part A 

premiums for QMBs using a group payer 

arrangement, which allows certain third 

parties (for example, States) to pay the 

Part A premiums for a class of 

beneficiaries.45 States that use a group 

payer arrangement for QMBs are known 

as ‘‘Part A group payer States.’’ 

As previously noted, to qualify for the 

QMB eligibility group under section 

1905(p)(1) of the Act, an individual 

must be entitled to hospital insurance 

benefits under Part A of title XVIII. In 

general, an individual becomes entitled 

to Part A if: (1) they are eligible for 

premium-free Part A based on payment 

of a payroll tax; or (2) are eligible to 

enroll in premium Part A and do enroll 

(creating a Part A premium obligation). 

Further, as noted in the proposed rule 

at 87 FR 54773, section 1905(a) of the 

Act specifies that payments of Medicare 

cost-sharing for QMBs (including Part A 

premiums) are ‘‘medical assistance’’ for 

purposes of FFP, if made in the month 

following the month in which the 

individual becomes a QMB. Thus, under 

a literal reading of the words of the 

statute, a State would not be able to 

claim or receive FFP under the QMB 

group for an individual without 

Premium-free Part A until the month 

after the month in which the individual 

is ‘‘entitled to Part A,’’ which would 

require that a Part A premium be billed 

to the individual until QMB coverage of 

the premium would begin. This would 

create a ‘‘catch 22’’ in which lowincome individuals without premiumfree Part A could only be eligible for 

QMB coverage that makes Part A 

enrollment affordable if they first 

became personally liable for the high 

cost of paying the Part A premium to 

become ‘‘entitled’’ to Part A, and thus 

eligible for QMB status. 

As we explained in the proposed rule 

at 87 FR 54773, this result would 

eviscerate the purpose of sections 1843 

and 1818(g) of the Act (‘‘buy-in statute’’) 

to avoid undue delays in QMB 

enrollment. Under a literal reading, 

States with a Part A buy-in agreement 

could theoretically use only 100 percent 

State funds to pay Part A premiums the 

first month to allow the individual to 

become entitled to Part A and start QMB 

coverage the next month. However, in 

Harris v. McCrae, 448 U.S. 297 (1980), 

the U.S. Supreme Court held that States 

cannot be required to provide Medicaid 

using only State funds. Further, while 

individuals can enroll in Part A at any 

time of the year without regard for 

Medicare enrollment periods or 

applicable late enrollment penalties if 

the State pays their Part A premium 

under its buy-in agreement, this is not 

the case for individuals who are paying 

the premium themselves. Individuals 

who must pay the Part A premium 

themselves must wait until a Medicare 

enrollment period to enroll in Part A 

and may be subject to late enrollment 

penalties. Thus, a literal read of the 

statute would defeat the purpose of buyin statute—to avoid delays in QMB 

enrollment by allowing QMB-eligible 

individuals who reside in Part A buy-in 

States to enroll in Part A at any time of 

the year, without the imposition of 

Medicare enrollment penalties. 


ddrumheller on DSK120RN23PROD with RULES2
65252 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

46Chapter 1, section 1.10 of the CMS Manual for 

the State Payment of Medicare Premiums, https:// 

www.cms.gov/files/document/chapter-1-programoverview-and-policy.pdf, and SSA POMS HI 

00801.140.C Premium Part A Enrollments for 

Qualified Medicare Beneficiaries (QMBs)—Part A 

Buy-In States and Group Payer States. http://

policynet.ba.ssa.gov/poms.nsf/lnx/0600801140. 

47The conditional enrollment process is 

described in chapter 1, section 1.11 of the CMS 

Manual for the State Payment of Medicare 

Premiums, https://www.cms.gov/files/document/ 

chapter-1-program-overview-and-policy.pdf, and in 

SSA POMS HI 00801.140 Premium Part A 

Enrollments for Qualified Medicare Beneficiaries 

(QMBs)—Part A Buy-In States and Group Payer 

States. http://policynet.ba.ssa.gov/poms.nsf/lnx/ 

0600801140. 

Recognizing that a literal read of the 

statute would produce a result that 

essentially nullifies the impact of the 

QMB and buy-in statutory provisions, 

we instituted a policy over 30 years ago 

under which States can receive FFP for 

paying an individual’s Part A premium 

the first month of entitlement, thereby 

triggering both Part A entitlement and 

QMB coverage. Under this longstanding 

policy, Part A buy-in States can 

determine an individual eligible for 

QMB status, and thus for their Part A 

premiums to be paid, if they are 

enrolled in Part B but not yet entitled 

to Part A.46 Group payer States similarly 

can approve eligibility for individuals 

under the QMB eligibility group if SSA 

has determined them conditionally 

eligible for premium Part A, through a 

process known as ‘‘conditional 

enrollment.’’ The conditional 

enrollment process enables low-income 

individuals to apply at SSA for 

premium Part A on the condition that 

they will only be enrolled in Part A if 

the State determines they would become 

eligible for the QMB group upon 

payment of the Part A premium.47

For multiple decades, the conditional 

enrollment policy has helped hundreds 

of thousands of individuals, many of 

whom are poorer and more likely to be 

non-native English speakers, to obtain 

essential assistance with Medicare 

premiums and cost-sharing by allowing 

States to pay the first month’s premium 

needed to trigger Medicare Part A 

entitlement (note that they do not 

actually become ‘‘entitled’’ to Part A 

until this payment is made). Without 

this policy, the subsidies available 

under the QMB group to make Part A 

affordable would only be available to 

individuals who somehow found a way 

to pay the initial Part A premium 

(including a late enrollment penalty if 

applicable) themselves. 

We proposed to amend the 

regulations to reflect the foregoing 

longstanding approach to implementing 

the statute in a manner that gives full 

effect to our understanding of the law’s 

intended policy in this rare instance in 

which implementing the plain meaning 

of the words of the statute would 

produce a result that is at odds with this 

statutory purpose. As noted in the 

proposed rule at 87 FR 54774 through 

54775, this approach is consistent with 

United States v. Ron Pair Enterprises, 

Inc., 489 U.S. 235 (1989) and other court 

opinions. We noted at 87 FR 54774 

through 54775 that there also is CMS 

precedent for not applying the plain 

meaning of the words of the statute 

when it leads to an absurd result 

contrary to our understanding of the 

purpose of the statute. 

For the reasons set forth previously in 

this final rule, in this case also, 

reversing our decades-long method of 

implementing the statute to instead 

apply the plain meaning of the words 

literally would be contrary to the 

fundamental purpose of the QMB 

statutory provisions. Therefore, as noted 

previously in this final rule, we 

proposed to incorporate in the 

regulations our longstanding practice of 

providing FFP for State payments of the 

first month of an individual’s Part A 

premium for individuals who are 

eligible for the QMB group based on 

enrollment in Part B in Part A buy-in 

States or conditional enrollment in Part 

A in group payer States. This also 

would facilitate enrollment into the 

QMB group for SSI recipients who need 

to pay a premium to enroll in Part A. 

We received comments on our 

proposed incorporation of this 

longstanding policy into regulations, 

and our responses follow. 

Comment: Several commenters 

expressly supported our proposal to 

codify our decades-old practice of 

paying Federal matching funds to States 

that pay the first month’s Part A 

premium for individuals eligible for the 

QMB group in Part A buy-in and group 

payer States, while no commenters 

opposed it. They concurred that a literal 

read of the relevant statutory provisions 

would create a ‘‘catch-22’’ in which 

low-income individuals cannot obtain 

QMB coverage that makes it affordable 

to enroll in Medicare until they become 

liable for the Part A premiums. They 

indicated that CMS’s longstanding 

method of implementing the statute has 

helped to prevent a substantial financial 

barrier that is wholly inconsistent with 

the purpose of QMB statute. A 

commenter expressed hope that 

codifying the longstanding workaround 

will prompt the few Part A group payer 

States that have not yet recognized 

conditional Part A enrollments to now 

accept them as a valid basis for QMB 

eligibility. 

Response: We thank the commenters 

for their support of the proposal to 

codify our longstanding practice to 

facilitate QMB enrollment for 

individuals without premium-free Part 

A. Over 700,000 individuals without 

premium-free Part A are currently 

enrolled in the QMB group. As 

indicated at 87 FR 54760 we estimated 

that if CMS were to remove this workaround, over 78,000 individuals without 

premium-free Part A each year would be 

prevented from enrolling in the QMB 

group. We anticipate that codification 

will provide additional clarity to States, 

beneficiaries, and organizations that 

assist them. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing without 

modification our proposal to codify our 

existing practice allowing States to 

receive Federal matching funds for the 

payment of Part A premiums the first 

month an individual is entitled to 

premium Part A. 

SSI Recipients Eligible for Premium Part 

A 

Based on the longstanding policy 

described previously in this final rule, 

in Part A buy-in States, when an SSI 

recipient who lacks sufficient work 

history for premium-free Part A has 

been determined eligible for the 

mandatory SSI or 209(b) group and is 

enrolled in Part B, the State can 

determine the individual eligible for the 

QMB eligibility group and enroll the 

individual in Part A buy-in. 

To streamline QMB enrollment for 

SSI recipients who must pay a premium 

to enroll in Part A, we proposed at 

§ 435.909(b)(1)(ii) to require Part A buyin States to deem those individuals who 

are determined eligible for the 

mandatory SSI or 209(b) groups as 

eligible for the QMB group and initiate 

their enrollment into Medicare Part A 

the month they are enrolled in Part B 

buy-in. 

In Part A buy-in States with a 1634 

agreement, once the State receives the 

automated Part B buy-in enrollment 

from CMS for an SSI recipient who 

lacks a sufficient work history for 

premium-free Part A, under proposed 

§ 435.909(b)(1)(ii) the State would enroll 

the individual in the mandatory SSI 

group, deem the individual eligible for 

the QMB group, and effectuate 

enrollment in Medicare Part A through 

the buy-in agreement. 

In a Part A buy-in State without a 

1634 agreement (that is, a criteria or 

209(b) State), once the individual 

applies to the Medicaid agency, some 

States currently only determine 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65253 

48Medicare Rights Center,‘‘Streamlining 

Medicare and QMB Enrollment for New Yorkers: 

Medicare Part A Buy-In Analysis and Policy 

Recommendations,’’ February 2011. https://

www.medicarerights.org/pdf/Part-A-Buy-InAnalysis.pdf. 

49CMS Manual for the State Payment of Medicare 

Premiums, chapter 1, section 1.15. https://

www.cms.gov/files/document/chapter-1-programoverview-and-policy.pdf. 

eligibility for the mandatory SSI or 

209(b) group, as applicable, and initiate 

Part B enrollment per their buy-in 

agreement. Under proposed 

§ 435.909(b)(1)(ii), these Part A buy-in 

States also would be required to deem 

any individuals determined by the State 

to be eligible for the mandatory SSI or 

209(b) groups as eligible for the QMB 

group and initiate enrollment in both 

Medicare Part A and Part B buy-in. 

In the 14 group payer States, it is 

more challenging for SSI recipients to 

enroll in Medicare Part A and the QMB 

eligibility group. Unlike in Part A buyin States, individuals determined 

eligible for the mandatory SSI or 209(b) 

group in group payer States who are 

enrolled in Part B pursuant to the State’s 

buy-in agreement will not necessarily 

satisfy the eligibility requirement for the 

QMB group that the individual be 

entitled to Part A. Even though the State 

will initiate enrollment of the 

individual in Part B, pursuant to its buyin agreement, it will not cover the 

individual’s Part A premium or initiate 

Part A enrollment under the buy-in 

agreement. Instead, the individual must 

separately apply for premium Part A at 

SSA using the conditional enrollment 

process, which is administratively 

burdensome for both individuals and 

the State, and the vast majority of 

individuals fail to complete the process 

unless an eligibility worker or other 

application assistor provides hands-on 

assistance throughout.48

Two other challenges currently make 

QMB enrollment harder for SSI 

recipients without premium-free Part A 

in group payer States. First, group payer 

States can only enroll individuals in 

premium Part A during the general 

Medicare enrollment period that runs 

from January through March each year. 

Second, group payer States are required 

to pay late enrollment penalties, if 

applicable, for those Medicaid 

beneficiaries who did not enroll in 

Medicare Part A timely when they first 

became eligible to do so. 

To streamline QMB enrollment for 

SSI recipients without premium-free 

Part A in group payer States, we 

proposed to add a State option for 

deeming individuals eligible for the 

QMB group. Specifically, proposed 

§ 435.909(b)(2) would allow, but not 

require, group payer States to directly 

initiate Medicare Part A enrollment for 

individuals who are not entitled to 

premium-free Part A without first 

sending them to SSA to apply for 

conditional Part A enrollment. Under 

this proposed State option, once the 

State has determined the individual 

eligible for the mandatory SSI or 209(b) 

group and become liable for paying their 

Part B premiums under the buy-in 

agreement pursuant to § 407.42, the 

State would also be able to deem them 

eligible for the QMB group. 

We received the following comments, 

and our responses follow. 

Comment: Several commenters 

supported our proposal to require Part 

A buy-in States to deem as eligible for 

the QMB group certain SSI recipients 

who must pay a premium to enroll in 

Part A because it would meaningfully 

improve the ability of this low-income, 

at-risk population to access the benefits 

for which they qualify and that they 

distinctly need. 

Response: We thank commenters for 

their support. We anticipate it will 

measurably increase the number of SSI 

recipients without premium-free Part A 

who participate in the QMB group. 

Comment: Some commenters sought 

clarifications about our proposals to 

require QMB deeming in Part A buy-in 

States and allow it in group payer 

States. A few commenters questioned 

whether our proposal would require 

States to deem SSI recipients without 

premium-free Part A into the QMB 

eligibility group retroactively. One 

commenter inquired whether Federal 

statute permits retroactive coverage of 

Medicare Part A premiums or allows 

States to provide retroactive Part A buyin coverage to SSI recipients, but not 

other QMB-eligible individuals. Another 

commenter inquired whether the 

proposal would require States to modify 

their systems to enroll SSI recipients in 

Part A buy-in. The commenter went on 

to question whether Part A buy-in States 

would need to align the QMB start date 

with the individual’s Part A enrollment 

during the GEP and whether individuals 

who lose Part A buy-in may be required 

to pay late enrollment penalties. The 

commenter also noted that streamlining 

QMB enrollment processes for non-SSI 

recipients who qualify for premium Part 

A, including non-citizens, is equally 

important and suggested that CMS 

consider facilitating QMB enrollment 

for this population. The commenter 

indicated that LIS leads data would not 

include records for such individuals. 

Response: At the outset, we clarify 

that our proposal would not permit 

States to retroactively enroll SSI 

recipients in Part A buy-in since, under 

section 1902(e)(8) of the Act, QMB 

coverage is effective the month 

following ‘‘the month in which the 

[QMB] determination first occurs’’ (that 

is, the month the State deems the SSI 

recipient eligible for the QMB group). 

For individuals who lack premium-free 

Part A, deeming would occur the month 

they are enrolled in the mandatory SSI 

or 209(b) group and Part A buy-in, and 

QMB coverage would start the month 

following the deeming month. For 

example, if an individual were enrolled 

in the mandatory SSI or 209(b) group 

and Part B buy-in in April 2025, the 

State would deem the individual 

eligible for QMB in April 2025, with 

Part A buy-in and QMB coverage 

effective May 1, 2025. As explained at 

87 FR 54772 and in our comment 

response in this final rule, States would 

only deem individuals eligible for QMB 

coverage during a past period if they are 

eligible for the mandatory SSI or 209(b) 

group and are retroactively determined 

eligible for premium-free Part A due to 

a delayed SSDI award. 

In addition, we anticipate that States 

may need to modify their processes and 

systems to enroll SSI recipients in Part 

A buy-in the month after they are 

deemed eligible for QMB and expect 

that the nature and design of operations 

and system changes will vary by State. 

We are available to provide technical 

assistance to States as they make 

operational and systems changes to 

implement this proposal. 

We clarify that Part A buy-in States 

would deem SSI recipients in QMB and 

enroll them in Part A buy-in throughout 

the year, not just during the GEP, since 

individuals covered under State buy-in 

agreements are not subject to Medicare 

enrollment periods. Further, we clarify 

that while residents of group payer 

States who lose eligibility for Part A 

buy-in may be subject to a late 

enrollment penalty, residents of Part A 

buy-in States who lose Part A buy-in are 

not liable for a late enrollment penalty 

even if they had been paying one prior 

to enrollment in Part A buy-in.49

Finally, we agree with the importance 

of simplifying QMB enrollment for 

individuals who are not entitled to SSI 

and lack premium-free Part A, many of 

whom are otherwise ineligible for 

Medicaid coverage and would solely 

rely on Medicare for health insurance. 

As such, we may consider whether a 

basis exists to streamline QMB 

enrollment for non-SSI recipients who 

lack premium-free Part A in future 

rulemaking. We are also available to 

explore with States options to 

streamline their current QMB eligibility 

and enrollment processes for this 


ddrumheller on DSK120RN23PROD with RULES2
65254 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

50See Dujack, Andrew et al., ‘‘Assessing the 

Fiscal Viability of a Medicare Part A Buy-in 

Agreement in Group Payer States,’’ The Integrated 

Care Resource Center, December 2021. https://

www.integratedcareresourcecenter.com/sites/ 

default/files/Assessing%20the%20Fiscal

%20Viability%20of%20a%20

Medicare%20Part%20A%20Buy-in%20Agreement

%20in%20Group%20Payer%20States.pdf. 

population. We also clarify that LIS 

leads data may include records for nonSSI recipients who lack premium-free 

Part A, do not already have Medicaid, 

and have applied for LIS. 

Comment: Many commenters 

supported our proposal to permit group 

payer States to deem SSI recipients 

without Part A eligible for QMB by 

employing processes used by Part A 

buy-in States to directly initiate Part A 

entitlement for individuals enrolled in 

Part B (avoiding the need to first send 

them to SSA to enroll in conditional 

Part A). They agreed that it would 

significantly simplify QMB enrollment 

for beneficiaries and promote 

administrative efficiencies for States. A 

few commenters supported keeping this 

an option rather than a requirement 

because increasing QMB enrollment 

through streamlined processes could 

increase States costs and require 

systems updates. 

Other commenters urged CMS to 

require group payer States to bypass the 

conditional enrollment process, citing 

numerous challenges arising from this 

process. These commenters indicated 

that the complexity of the conditional 

enrollment process presents an almost 

insurmountable obstacle for SSI 

recipients, who are among those least 

able to navigate complex application 

processes. They contended that 

requiring the lowest income, high needs 

older adults to first apply for 

conditional Part A at a separate agency 

is unrealistic and unfair and that getting 

lost in the process is the rule rather than 

the exception for those who lack 

assistance from an advocate, 

particularly for individuals with limited 

English proficiency and low literacy 

skills. They explained that having to 

wait until the GEP to file a conditional 

enrollment further complicates and 

delays the process. Some commenters 

noted that SSI recipients in States with 

group payer and 209(b) status face the 

steepest obstacles to obtain the benefits 

to which they are entitled because they 

must file an application for the 209(b) 

eligibility group with their State before 

completing the two-step application 

process to enroll in QMB. Some 

commenters stated that, despite the 

release of clearer program instructions 

to SSA field offices, government offices 

commonly provide incorrect 

information about the process or fail to 

properly enroll individuals in benefits. 

One commenter suggested that CMS has 

legal authority to mandate that group 

payer States deem SSI recipients 

without premium-free Part A eligible for 

QMB because doing so would still leave 

the administrative Part A group 

payment option intact. Finally, another 

commenter requested that CMS require 

the remaining group payer States to 

convert to Part A buy-in status since a 

particular group payer State has not 

voluntarily taken that step despite 

requests from interested parties. 

Response: We appreciate the 

commenters’ support for allowing group 

payer States to bypass the conditional 

enrollment process for SSI recipients 

and deem them eligible for the QMB 

group. As we explained previously in 

this final rule and as noted by the 

commenters, although the conditional 

enrollment process provides a way for 

individuals to enroll in the QMB 

without paying the Part A premiums 

upfront, it is still extremely difficult for 

this very low-income, high-need 

population to traverse. We encourage 

group payer States to adopt the more 

streamlined processes used in Part A 

buy-in States. However, we recognize 

that the 14 group payer States may face 

unique challenges, with differing needs 

and opportunities. Therefore, we 

decline to adopt the commenters’ 

recommendations to require group 

payer States to deem SSI recipients 

without Part A in QMB, or to convert to 

Part A buy-in status in this final rule, 

but we may consider whether there is a 

basis for such requirements in future 

rulemaking. 

Comment: Several commenters 

recommended that CMS take steps to 

persuade group payer States to become 

Part A buy-in States in the event we 

permit—but do not require—group 

payer States to deem SSI recipients 

eligible for the QMB group. For 

example, some commenters suggested 

that CMS provide direct outreach to 

group payer States to explain how they 

would achieve savings by enrolling 

more Medicaid beneficiaries in Part A, 

which pays primary to Medicaid for Part 

A-covered services like inpatient 

hospital and skilled nursing facility 

care. Another commenter requested that 

CMS consider levers to incentivize 

group payer States to convert to Part A 

buy-in status, for example, charging 

group payer States for the additional 

administrative costs SSA incurs for 

processing conditional Part A 

applications for their residents. A 

commenter suggested that CMS require 

group payer States that decline to deem 

SSI recipients eligible for the QMB 

group to actively assist individuals in 

completing the conditional enrollment 

process at SSA rather than requiring 

individuals to navigate the process 

themselves. 

Response: We agree with the 

importance of working with group payer 

States to assess the impact of entering 

into a Part A buy-in agreement. Part A 

buy-in agreements are beneficial to 

individuals and may also reduce 

administrative burden and costs for 

providers and States. To that end, we 

commissioned a decision support tool 

and offered technical assistance to 

group payer States to help them analyze 

the fiscal impact of newly executing a 

Part A buy-in agreement with us.50 We 

will continue such education and 

outreach to group payer States. We 

decline to adopt the commenter’s 

suggestion to charge group payer States 

for costs associated with conditional 

enrollments at SSA, but we may 

consider other steps to promote QMB 

enrollment group payer States in the 

future. We also highly encourage States 

to help individuals in completing the 

conditional enrollment process at SSA, 

but we decline to make such assistance 

a requirement at this time. 

After considering the comments 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal to require Part A buy-in States 

to deem individuals enrolled in the 

mandatory SSI or 209(b) group eligible 

for the QMB group and to permit group 

payer States to adopt the same 

streamlined procedures used in Part A 

buy-in States under new 

§§ 435.909(b)(1) and 435.909(b)(1) with 

a modified compliance date to allow 

States more time for implementation. 

This modification extends the 

compliance date for this provision to 

October 1, 2024. 

4. Clarifying the Qualified Medicare 

Beneficiary Effective Date for Certain 

Individuals (§ 406.21) 

We proposed to clarify the effective 

date of coverage under the QMB group 

for individuals who must pay a 

premium to enroll in Part A and reside 

in a group payer State to provide 

individuals with protection from 

Medicare premiums and cost-sharing 

costs on the earliest possible date. 

As discussed in the proposed rule at 

87 FR 54775, eligible individuals who 

do not enroll in premium Part A during 

their initial enrollment period (IEP), the 

7-month period that starts the third 

month before the individual qualifies 

for Medicare, or who disenroll from 

premium Part A and wish to re-enroll, 

must generally do so during the general 


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51See CMS Manual for the State Payment of 

Medicare Premiums, chapter 1, section 1.11. 

https://www.cms.gov/files/document/chapter-1- 

program-overview-and-policy.pdf. 

enrollment period (GEP). The GEP, 

established under section 1837(e) of the 

Act, is the period beginning on January 

1 and ending on March 31 of each year. 

Section 120 of the Consolidated 

Appropriations Act, 2021 (CAA, 2021, 

Pub. L. 116–260) revised the Part A 

entitlement effective date for 

individuals who enroll during the GEP 

beginning on or after January 1, 2023 

from the first of July following their 

enrollment to the first day of the month 

following the month in which they 

enroll. In the November 3, 2022 

regulation entitled ‘‘Medicare Program; 

Implementing Certain Provisions of the 

Consolidated Appropriations Act, 2021 

and Other Revisions to Medicare 

Enrollment and Eligibility Rules’’ (87 FR 

66454), we revised § 406.21(c) to 

implement the GEP effective dates 

outlined in section 120 of the CAA. 

To align with that change, we 

proposed at 87 FR 54775 to clarify the 

applicable effective date of QMB 

coverage for an individual who resides 

in a group payer State and enrolls in 

conditional Part A during the GEP. As 

discussed previously in this final rule, 

in the proposed rule (87 FR 54773 & 

54774), in a Part A buy-in State, we 

consider enrollment in Part B sufficient 

to meet the requirement that an 

individual be entitled to Part A for the 

purposes of the QMB eligibility 

determination. However, in a group 

payer State, enrollment in QMB for 

individuals who need to pay a premium 

to enroll in Part A is always a two-step 

process. The State cannot determine 

individuals eligible for QMB and enroll 

them in Part A buy-in until SSA 

establishes actual or conditional Part A 

enrollment. With respect to QMB 

enrollment under a buy-in agreement 

under § 406.26, Medicare Part A 

coverage begins the first month an 

individual is entitled to Part A under 

§ 406.20(b) and has QMB status. We 

consider a conditional Part A filing to be 

sufficient to fulfill the requirement for 

entitlement to Part A as applicable for 

QMB coverage.51

Specifically, we proposed in new 

§ 406.21(c)(5) to codify existing policy 

that individuals who reside in group 

payer States and enroll in actual or 

conditional Part A during the GEP can 

obtain QMB as early as the month Part 

A entitlement begins. Beginning on or 

after January 1, 2023, for individuals 

who enroll in Medicare during the GEP, 

QMB coverage starts the month 

premium Part A entitlement begins (if 

the State determines the individual has 

met the eligibility requirements for 

QMB coverage in the same month that 

Part A enrollment occurs), or a month 

later than the month of Part A 

entitlement (if the individual is 

determined eligible for QMB the month 

Part A entitlement begins or later). 

We received the following comments 

on our proposed codification of the 

effective date in § 406.21(c)(5), and our 

responses follow. 

Comment: Multiple commenters 

expressed thanks for our proposal to 

codify our existing policy regarding the 

applicable effective date of QMB 

coverage for an individual who resides 

in a group payer State and enrolls in 

conditional Part A during the GEP. 

According to the commenters, codifying 

the policy would aid beneficiaries and 

promote clarity and accountability for 

States as they adjust their processes to 

align with changes to the effective date 

of Part A entitlement for enrollments 

made during the IEP and GEP and the 

creation of new SEPs under the CAA, 

2021. A commenter supported the 

policy but noted that it would take 18– 

24 months for a specific State to 

implement this change. 

Response: We thank the commenters 

for their support for incorporating into 

our regulations our existing policy 

regarding the QMB start date in group 

payer States. To provide States more 

time to implement this proposal, we 

plan to modify the compliance date to 

April 1, 2026. 

Comment: A few commenters 

encouraged CMS to provide technical 

assistance and information to States and 

education to SHIPs, advocates, and 

counselors to help ensure individuals in 

group payer States receive benefits at 

the earliest possible date. For example, 

a commenter suggested that CMS 

produce FAQs explaining how the 

conditional enrollment process 

generally works and how the change in 

the effective date of GEP enrollments 

under the CAA, 2021 (that is, the month 

following the month of enrollment) 

means that individuals will lose 

valuable months of benefits if they do 

not apply for QMB the same month they 

conditionally enroll in Part A. The 

commenter also requested that CMS 

clarify that individuals who enroll in 

conditional Part A would not become 

liable for Part A premiums if they are 

not approved for the QMB group and 

address uncommon occurrences, such 

as if an individual wants to change their 

conditional Part A enrollment to actual 

Part A enrollment if they experience a 

medical emergency and need Part A 

coverage before QMB benefits can start. 

The commenter further recommended 

that, as group payer States update their 

processes, CMS act quickly to help 

correct any QMB enrollment delays and 

ensure that individuals receive refunds 

for any Medicare cost-sharing amounts 

they incur before such corrections are 

made. Another commenter requested 

clarification on whether a group payer 

State must provide Part A buy-in and 

QMB benefits to individuals who enroll 

in premium Part A during an SEP, such 

as the new SEP for formerly 

incarcerated individuals. 

Response: We agree with the 

importance of providing education and 

assistance to promote the earliest access 

to QMB benefits. We will consider these 

issues and others as we update our 

existing materials to inform States, 

beneficiaries, SHIPs, advocates, and 

other interested parties about these 

policies. In response to the question 

about Part A enrollments in group payer 

States during an SEP, we clarify that 

individuals can use the new SEPs to 

enroll in premium Part A under existing 

SSA processes for the purposes of 

enrolling in the QMB eligibility group. 

As such, a group payer State must 

determine eligible individuals who 

enroll in premium Part A during an SEP 

eligible for Part A buy-in and QMB 

coverage. Further, if a group payer State 

recognizes conditional enrollments filed 

during a GEP as meeting the 

requirement for entitlement to Part A for 

the purposes of QMB eligibility, it 

would be required to treat conditional 

enrollments made during an SEP as a 

basis for QMB eligibility. 

After considering the comments we 

received and for the reasons outlined in 

the proposed rule and our responses to 

comments, we are finalizing our 

proposal to codify existing policy that 

individuals who reside in group payer 

States and enroll in actual or 

conditional Part A during the GEP can 

obtain QMB as early as the month Part 

A entitlement begins under 

§ 406.21(c)(5), with a modified 

compliance date to allow States more 

time to implement this provision. This 

modification extends the compliance 

deadline to April 1, 2026. 

III. Collection of Information 

Requirements 

Under the Paperwork Reduction Act 

of 1995 (PRA) (44 U.S.C. 3501 et seq.), 

we are required to provide 60-day notice 

in the Federal Register and solicit 

public comment before a ‘‘collection of 

information’’ requirement is submitted 

to the Office of Management and Budget 

(OMB) for review and approval. For the 

purposes of the PRA and this section of 

the preamble, collection of information 


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65256 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

52https://aspe.hhs.gov/sites/default/files/ 

migrated_legacy_files//176806/VOT.pdf. 

53https://fred.stlouisfed.org/series/ 

LEU0252881500A. 

is defined under 5 CFR 1320.3(c) of the 

PRA’s implementing regulations. 

To fairly evaluate whether an 

information collection should be 

approved by OMB, section 3506(c)(2)(A) 

of the PRA requires that we solicit 

comment on the following issues: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of our agency. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

In our September 7, 2022 (87 FR 

54760) proposed rule, we solicited 

public comment on each of the required 

issues under section 3506(c)(2)(A) of the 

PRA for the following collection of 

information requirements. We did not 

receive comments related to any of the 

proposed collection of information 

requirements or associated burden 

estimates. 

We have made changes from the 

proposed rule to this final rule to the 

wages identified immediately below, the 

associated cost estimates, the number of 

States impacted by our change to the 

definition of family size, associated cost 

estimates (see discussion in section 

IV.C.1. of this final rule) and cost 

estimates impacted by changes related 

to the modification of our proposal to 

screen LIS applicants for full Medicaid 

(see discussion in section IV.C.1. of this 

final rule). At this time, we are not 

making changes to other proposed 

collection of information requirements 

and time estimates in this rule. As 

described later in this section, we are 

reorganizing (relative to the proposed 

rule) the Collection of Information and 

Regulatory Impact Analysis sections of 

this final rule. However, we discuss 

wage, FMAP, and other related info here 

in this section to match its placement in 

the proposed rule. 

A. Wage Estimates 

Wage Changes. In this final rule, we 

are adjusting the wage for individuals 

from $28.01/hr to $21.98/hr. The 

adjustment from the proposed rule is 

based on internal review as we changed 

the source of the wage figure from U.S. 

Bureau of Labor Statistics’ (BLS) May 

2021 National Occupational 

Employment and Wage Estimates at 

$28.01/hr (see 87 FR 54817) to HHS 

guidance at $21.98/hr (see Wages for 

Individuals, below). This change affects 

the cost estimates in sections IV.C.1. 

and 2. of this final rule. 

We are also adjusting the wages for 

State government respondents. At the 

time of publication of the proposed rule 

the most recent BLS wage figures were 

from May 2021 (see 87 FR 54817). At 

the time of publication of this final rule 

the most recent BLS wage figures are 

from May 2022. This change affects the 

cost estimates in sections IV.C.1., 2. and 

5. of this final rule. 

Wages for State Governments. To 

derive average State-specific costs, we 

used data from the BLS May 2022 

National Occupational Employment and 

Wage Estimates for all salary estimates 

(http://www.bls.gov/oes/current/oes_

nat.htm). In this regard, Table 2 presents 

the BLS’ mean hourly wage, our 

estimated cost of fringe benefits and 

other indirect costs (calculated at 100 

percent of salary), and our adjusted 

hourly wage. 

TABLE 2—NATIONAL OCCUPATIONAL EMPLOYMENT AND WAGE ESTIMATES

Occupation title Occupation code Mean hourly wage 

($/hr) 

Fringe benefits 

and other indirect 

costs 

($/hr) 

Adjusted hourly 

wage 

($/hr) 

Business Operations Specialist ............................................... 13–1000 40.04 40.04 80.08 

Computer Programmer ............................................................ 15–1251 49.42 49.42 98.84 

Database and Network Administrator and Architect ............... 15–1240 53.08 53.08 106.16 

Eligibility Interviewers, Government Programs ........................ 43–4061 24.05 24.05 48.10 

General and Operations Mgr ................................................... 11–1021 59.07 59.07 118.14 

As indicated, we are adjusting our 

employee hourly wage estimates by a 

factor of 100 percent. This is necessarily 

a rough adjustment, both because fringe 

benefits and other indirect costs vary 

significantly from employer to 

employer, and because methods of 

estimating these costs vary widely from 

study to study. Nonetheless, we believe 

that doubling the hourly wage to 

estimate total cost is a reasonably 

accurate estimation method. 

Cost to State Governments. To 

estimate State costs, it was important to 

take into account the Federal 

Government’s contribution to the cost of 

administering the Medicaid program. 

The Federal Government provides 

funding based on a Federal Medical 

Assistance Percentage (FMAP) that is 

established for each State, based on the 

per capita income in the State as 

compared to the national average. 

FMAPs range from a minimum of 50 

percent in States with higher per capita 

incomes to a maximum of 76.25 percent 

in States with lower per capita incomes. 

For Medicaid, all States receive a 50 

percent FMAP for administration. As 

noted previously, States also receive 

higher Federal matching rates for certain 

services and for systems improvements 

or redesign, so the level of Federal 

funding provided to a State can be 

significantly higher. As such, in taking 

into account the Federal contribution to 

the costs of administering the Medicaid 

program for purposes of estimating State 

burden with respect to the collection of 

information requirements, we elected to 

use the higher-end estimate that the 

States would contribute 50 percent of 

the costs, even though the burden will 

likely be much smaller. 

Wages for Individuals. We believe that 

the cost for beneficiaries undertaking 

administrative and other tasks on their 

own time is a post-tax wage of $21.98/ 

hr. 

The Valuing Time in U.S. Department 

of Health and Human Services 

Regulatory Impact Analyses: Conceptual 

Framework and Best Practices 52

identifies the approach for valuing time 

when individuals undertake activities 

on their own time. To derive the costs 

for beneficiaries, we used a 

measurement of the usual weekly 

earnings of wage and salary workers of 

$1,059 53 for 2022 and then divided by 

40 hours to calculate an hourly pre-tax 

wage rate of $26.48/hr. This rate is 

adjusted downwards by an estimate of 

the effective tax rate for median income 

households of about 17 percent or 

$4.50/hr ($26.48/hr × 0.17), resulting in 

the post-tax hourly wage rate of $21.98/ 


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54See final rule titled ‘‘Eligibility Notices, Fair 

Hearing and Appeal Processes for Medicaid and 

Other Provisions Related to Eligibility and 

Enrollment for Medicaid and CHIP’’ published in 

the November 30, 2016 Federal Register (81 FR 

86382, 86438). https://www.federalregister.gov/ 

documents/2016/11/30/2016-27844/medicaid-andchildrens-health-insurance-programs-eligibilitynotices-fair-hearing-and-appeal; final rule titled 

‘‘Essential Health Benefits in Alternative Benefit 

Plans, Eligibility Notices, Fair Hearing and Appeal 

Processes, and Premiums and Cost Sharing; 

Exchanges: Eligibility and Enrollment’’ published 

in the July 15, 2013 Federal Register (78 FR 42159, 

42288). https://www.federalregister.gov/documents/ 

2013/07/15/2013-16271/medicaid-and-childrenshealth-insurance-programs-essential-healthbenefits-in-alternative-benefit; and final rule titled 

‘‘Eligibility Changes Under the Affordable Care Act 

of 2010’’ published in the March 23, 2012 Federal 

Register (77 FR 17143, 17197). https://

www.federalregister.gov/documents/2012/03/23/ 

2012-6560/medicaid-program-eligiblity-changesunder-the-affordable-care-act-of-2010. 

55There is a current package for burdens related 

to Medicaid application (0938–1191 (CMS–10440)), 

but it focuses on MAGI eligibility groups, not nonMAGI eligibility groups. 

hr ($26.48/hr¥$4.50/hr). Unlike our 

State wage adjustments, we are not 

adjusting beneficiary wages for fringe 

benefits and other indirect costs since 

the individuals’ activities, if any, would 

occur outside the scope of their 

employment. 

B. Information Collection Requirements 

(ICRs) 

In the proposed rule, we projected 

both new burdens and savings based on 

how our proposed rule would change 

burdens relative to the status quo. 

Because the Medicaid program predates 

the enactment of PRA and we viewed 

many longstanding basic Medicaid 

requirements as customary business 

practices for State Medicaid agencies,54

we did not have specific PRA packages 

outlining these burdens inherent to the 

Medicaid program, including 

application 55 (burden on State in 

processing the application and burden 

on individual in filling out application); 

requests for additional information 

(burden on State in assessing 

application and burden on individual in 

responding to State); making eligibility 

determinations and providing appeal 

rights (burden on State in making 

determinations and burden on 

individual if filing appeal); verifying 

information in the application (burden 

on State in conducting verifications and 

burden on individual in supplying 

supporting documentation); and 

renewal process (burden on State in 

conducting renewals and burden on 

individual in responding to State). 

However, we now recognize that 

creating PRA packages for the 

longstanding Medicaid functions, plus 

the changes from this final rule, would 

improve transparency for the public. In 

the proposed rule, we incorrectly 

referenced PRA packages that did not 

contain these longstanding provisions. 

As such, after publication of this final 

rule, we plan to develop and publish 

new PRA packages that consist of both 

the longstanding MSP application and 

enrollment provisions and the changes 

made by this final rule. In the 

meantime, we are moving our estimates 

for burden and savings to the Regulatory 

Impact Analysis (RIA) section. 

IV. Regulatory Impact Analysis 

A. Statement of Need 

We have learned through our 

experiences in working with States and 

other interested parties that certain 

policies result in unnecessary burdens 

and create barriers to enrollment and 

retention of coverage. As a result, many 

older adults and people with disabilities 

experience administrative confusion, 

economic hardships, and challenges 

accessing health care services. In 

response to multiple Executive Orders, 

as cited in section I. of this final rule, 

we reviewed existing regulations for 

areas where access could be improved. 

In this rulemaking, we finalize 

policies to streamline processes to 

enroll in (and maintain enrollment in) 

Medicaid through the MSPs. Together, 

the changes in this final rule would 

reduce administrative burden on States 

and enrollees, expand coverage of 

eligible applicants, increase retention of 

eligible enrollees, and improve health 

equity. 

B. Overall Impact 

We have examined the impacts of this 

rule as required by Executive Order 

12866 on Regulatory Planning and 

Review (September 30, 1993), Executive 

Order 13563 on Improving Regulation 

and Regulatory Review (January 18, 

2011), Executive Order 14094 entitled 

‘‘Modernizing Regulatory Review’’ 

(April 6, 2023), the Regulatory 

Flexibility Act (RFA) (September 19, 

1980, Pub. L. 96354), section 1102(b) of 

the Act, section 202 of the Unfunded 

Mandates Reform Act (UMRA) of 1995 

(March 22, 1995; Pub. L. 104–4), 

Executive Order 13132 on Federalism 

(August 4, 1999), and the Congressional 

Review Act (5 U.S.C. 804(2)). 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). The Executive Order 14094 

entitled ‘‘Modernizing Regulatory 

Review’’ (hereinafter, the Modernizing 

E.O.) amends section 3(f)(1) of Executive 

Order 12866 (Regulatory Planning and 

Review). The amended section 3(f) of 

Executive Order 12866 defines a 

‘‘significant regulatory action’’ as an 

action that is likely to result in a rule: 

(1) having an annual effect on the 

economy of $200 million or more in any 

1 year (adjusted every 3 years by the 

Administrator of the Office of 

Information and Regulatory Affairs 

(OIRA) for changes in gross domestic 

product), or adversely affect in a 

material way the economy, a sector of 

the economy, productivity, competition, 

jobs, the environment, public health or 

safety, or State, local, territorial, or 

Tribal governments or communities; (2) 

creating a serious inconsistency or 

otherwise interfering with an action 

taken or planned by another agency; (3) 

materially altering the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or (4) 

raising legal or policy issues for which 

centralized review would meaningfully 

further the President’s priorities or the 

principles set forth in this Executive 

Order, as specifically authorized in a 

timely manner by the Administrator of 

OIRA in each case. 

A regulatory impact analysis (RIA) 

must be prepared for major rules with 

significant regulatory action(s) or with 

significant effects ($200 million or more 

in any 1 year). Based on our estimates, 

OMB’s OIRA has determined this 

rulemaking is significant per section 

3(f)(1) as measured by the $200 million 

threshold. Accordingly, we have 

prepared an RIA that to the best of our 

ability presents the costs and benefits of 

the rulemaking. 

The aggregate economic impact of this 

final rule is estimated to be $26.16 

billion (in real FY 2025 dollars) over 5 

years. This represents additional health 

care spending made by Medicaid on 

behalf of beneficiaries, with $10.67 

billion paid by the Federal Government 

and $7.89 billion paid by the States, and 

an additional $7.60 billion in Medicare 

spending. 

The RFA requires agencies to analyze 

options for regulatory relief of small 

businesses. For purposes of the RFA, 

small entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdictions. Most 

hospitals and most other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues 

of less than $8.0 million to $41.5 

million in any one year. Individuals and 

States are not included in the definition 

of a small entity. Since this final rule 


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would only impact States and 

individuals, we do not believe that this 

final rule will have a significant 

economic impact on a substantial 

number of small businesses. 

In addition, section 1102(b) of the Act 

requires CMS to prepare an RIA if a rule 

may have a significant impact on the 

operations of a substantial number of 

small rural hospitals. This analysis must 

conform to the provisions of section 604 

of the RFA. For purposes of section 

1102(b) of the Act, we define a small 

rural hospital as a hospital that is 

located outside a Metropolitan 

Statistical Area and has fewer than 100 

beds. This final rule applies to State 

Medicaid agencies and would not add 

requirements to rural hospitals or other 

small providers. Therefore, we are not 

preparing an analysis for section 1102(b) 

of the Act because we have determined, 

and the Secretary certifies, that this final 

rule would not have a significant impact 

on the operations of a substantial 

number of small rural hospitals. 

Section 202 of the UMRA also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule whose mandates require spending 

in any one year of $100 million in 1995 

dollars, updated annually for inflation. 

In 2023, that is approximately $177 

million. We believe that this final rule 

would have such an effect on spending 

by State, local, or Tribal governments 

but not by private sector entities. 

Overall Assumptions 

In developing these estimates, we 

have relied on several global 

assumptions. All estimates are based on 

the projections from the President’s FY 

2024 Budget. We have assumed that 

new enrollees would have the same 

average costs as current enrollees by 

eligibility group, unless specified in the 

description of the estimates (for 

example, some enrollees only would 

receive Medicare premium assistance). 

We have also updated the 

implementation dates of the provisions, 

with provisions to require States to 

automatically enroll SSI recipients as 

QMBs starting in October 2024 and all 

other provisions requiring compliance 

by April 2026. We have also relied on 

the data sources and assumptions 

described in the next section to develop 

estimates for specific provisions of this 

final rule. 

C. Anticipated Effects 

1. Facilitate Enrollment Through 

Medicare Part D LIS Leads Data 

As described in section II.A.1. of this 

final rule, we are finalizing the addition 

of § 435.911(e), which focuses on using 

the SSA data from processing LIS 

applications ‘‘LIS leads data’’ to 

streamline MSP eligibility 

determinations. Relative to our 

proposal, the finalized paragraph (e) has 

three main differences. First, we are 

modifying the proposed requirement at 

paragraphs (e)(6)(i) and (ii) for States to 

collect additional information to screen 

individuals for full Medicaid eligibility 

to require that distinct from the MSP 

enrollment process unless otherwise 

approved by CMS, States separately 

provide the individual the opportunity 

to authorize the Medicaid agency to 

determine full Medicaid eligibility and 

furnish any additional needed 

information. We decided to modify this 

proposal based on comments received to 

avoid delays in MSP enrollment and 

disadvantages associated with 

modifying the LIS application, while 

also ensuring that we facilitate 

individuals’ access to full-scope 

Medicaid coverage. We are also moving 

this requirement from paragraphs 

(e)(6)(i) and (ii) to paragraph (e)(9). 

Second, we are applying a compliance 

date of April 1, 2026 for States to come 

into full compliance with all the 

provisions in new § 435.911(e). Third, 

we revised some wording and reordered 

the other paragraphs in § 435.911(e) for 

clarity and flow as noted below: 

• Paragraph (e)(1): We are retaining 

the requirement to accept LIS leads data 

in paragraph (e)(1), but are removing the 

term ‘‘Low Income Subsidy application 

data’’ and using an acronym in place of 

‘‘Social Security Administration’’ since 

‘‘LIS leads data’’ and ‘‘SSA’’ are now 

established in paragraph (e). 

• Paragraph (e)(2): We are keeping 

the requirement to treat LIS leads data 

as application for the MSPs without 

requiring submission of another 

application in finalized paragraph (e)(2), 

but are moving the requirement 

regarding timely application processing 

to finalized paragraph (e)(7). 

• Paragraph (e)(3): We are moving the 

requirement to accept any information 

provided by SSA, which we are now 

specifying as LIS leads data for greater 

consistency in terminology throughout 

the regulation, without further 

verification, from proposed paragraph 

(e)(5) to finalized paragraph (e)(3) and 

adding that this provision applies 

unless the State agency has information 

that is not reasonably compatible with 

the LIS leads data or the LIS leads data 

would not support a determination of 

MSP eligibility. 

• Paragraph (e)(4): We are retaining 

the requirement to not collect 

information or documentation from the 

individual in finalized paragraph (e)(4) 

and are adding that this is unless the 

State agency has information that is not 

reasonably compatible with the LIS 

leads data. 

• Paragraph (e)(5): We are moving the 

requirement to seek additional 

information from proposed paragraph 

(e)(3) to finalized paragraph (e)(5) and 

defining additional information needed 

for the MSP determination as 

information that is not in the leads data. 

• Paragraph (e)(6): We are moving the 

requirement to verify an individual’s 

citizenship and immigration status from 

proposed paragraph (e)(6)(iii) to 

finalized paragraph (e)(6), adding a 

citation to § 435.406, and streamlining 

the regulation text. 

• Paragraph (e)(7): We are moving the 

requirement regarding timely 

application processing from proposed 

paragraph (e)(2) to finalized paragraph 

(e)(7). 

• Paragraph (e)(8): We are moving 

additional requirements if the LIS leads 

data does not support a determination of 

MSP eligibility from proposed 

paragraph (e)(7) to finalized paragraph 

(e)(8). 

• Paragraph (e)(9): We are moving 

and modifying the proposal related to 

screening for full Medicaid from 

proposed paragraphs (e)(6)(i) and (ii) to 

finalized paragraphs (e)(9)(i) and (ii) to 

require States to provide individuals 

with—in addition to and separate from 

any requests for additional information 

necessary for a determination of 

Medicare Savings Program eligibility, 

unless CMS approves otherwise— 

information about the availability of 

additional Medicaid benefits on other 

bases and responsibilities of the 

individual applying for such benefits, 

and an opportunity to furnish such 

additional information as may be 

needed to determine whether the 

individual is eligible for such additional 

Medicaid benefits. 

The clarifications in paragraph (e)(9) 

requiring screening of LIS applicants for 

full Medicaid to be separate from a 

request for additional information 

necessary for a determination of MSPs 

does not represent a major change to the 

proposal. However, we neglected to 

make an initial burden estimate for the 

proposed requirement to screen LIS 

applicants for full Medicaid. As such, 

we now make an estimate for the new 

requirement in paragraph (e)(9) that 

would require States to collect new 

information, provide beneficiaries with 

an opportunity to authorize this new 

information collection, and make a 

determination for full Medicaid based 

on the information collection. We are 

permitting significant flexibility to 

States for how they implement the 

requirement at paragraph (e)(9), and we 


ddrumheller on DSK120RN23PROD with RULES2
Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65259 

56Over the past 5 years (2017–2021), SSA 

approved an average of 394,025 LIS applications 

annually. https://www.ssa.gov/open/data/Dataabout-Extra-Help-with-Medicare-Prescription-DrugPlan-Cost.html. We do not have estimates for any 

potential increases in application volume or 

approval rates based on changes to LIS eligibility 

criteria in the Inflation Reduction Act. 

expect States will make varying use of 

automation and different forms of 

communication to applicants. For 

efficiency reasons, we believe that a 

State would send the required 

disclosures/consent for the agency to 

make a full Medicaid eligibility 

determination as well as the request for 

additional information needed to make 

a full Medicaid determination in one 

correspondence. Moreover, instead of 

asking many questions in order to gain 

additional information necessary to 

make a full Medicaid eligibility 

determination, we anticipate that States 

will instead merely highlight the 

additional information individuals need 

to fill out on the full Medicaid 

application form. We expect the State 

burden would be, an ongoing burden of, 

on average, 15 minutes per LIS 

applicant (400,000 total) to provide the 

required disclosures/consent and 

highlight the additional information 

individuals need to fill out on the full 

Medicaid application form. The full 

Medicaid application form will not need 

to be revised. 

We believe most individuals would 

not have an additional burden 

associated with this provision because 

we assume that the vast majority (85 

percent) of individuals will not respond 

to the States’ request for additional 

information. In reaching this 

conclusion, we note that individuals are 

generally discouraged from applying for 

Medicaid by burdensome application 

processes and repeated requests for 

additional information. Given that the 

determination of full Medicaid for LIS 

applicants would inevitably require 

individuals to face these hurdles, we 

believe it is reasonable to conclude that 

only around 15 percent of individuals 

will respond to States’ requests for 

information. States will then only need 

to process and make full Medicaid 

determinations for the remainder of 

individuals (15 percent or 60,000 

individuals [400,000 LIS applicants × 

0.15]), which will take about 1 hour at 

$48.10/hr. The annual State burden for 

sending individuals the new 

information is 100,000 hours (400,000 

LIS applicants × 0.25 hr) at a cost of 

$4,810,000 (100,000 hr × $48.10/hr). 

For processing the information 

received from individuals, we estimate 

an annual State burden of 60,000 hours 

(60,000 applicants × 1 hr/application) at 

a cost of $2,886,000 (60,000 hr × $48.10/ 

hr). 

The total State burden is 160,000 

hours (100,000 hr + 60,000 hr) and 

$7,696,000 ($4,810,000 + $2,886,000). 

However, when taking into account 

the 50 percent Federal contribution to 

Medicaid program administration, the 

estimated State cost is $3,848,000 

($7,696,000 × 0.50). 

For individuals to respond to States’ 

request for information (that is, 

complete the remainder of the full 

Medicaid application), we estimate that 

it will take 4 hours at $21.98/hr. In 

aggregate, we estimate an annual burden 

of 240,000 hours (60,000 applicants × 4 

hr/application) at a cost of $5,275,200 

(240,000 hr × $21.98/hr). 

New requirements in this final rule at 

§ 435.911(e)(1) require States to accept, 

via secure electronic interface, the SSA 

LIS leads data, while § 435.911(e)(2) 

requires that States treat receipt of the 

leads data as an application for the 

MSPs. Section 435.911(e)(3) requires 

States to accept information provided 

through the leads data relating to a 

criterion of eligibility without further 

verification unless information available 

to the agency is not reasonably 

compatible with information provided 

by or on behalf of the individual, while 

§ 435.911(e)(4) requires States to refrain 

from requesting information from 

individuals already provided through 

leads data unless information available 

to the agency is not reasonably 

compatible with information provided 

by or on behalf of the individual. 

Sections 435.911(e)(5) and (6) require 

States to seek additional information as 

needed to determine MSP eligibility. 

Section 435.911(e)(7) requires State 

agencies to promptly determine MSP 

eligibility. Finally, § 435.911(e)(8) 

requires further steps if the leads data 

does not support a determination of 

eligibility. 

We estimate that as a result of 

finalized provisions in § 435.911(e), 

States will be able to adjudicate over 90 

percent of MSP applications for LIS 

enrollees without gathering additional 

documentation from the applicants. 

Therefore, as there are about 400,000 

new LIS applicants approved annually 

in 51 States (all 50 States and the 

District of Columbia),56 we estimate that 

360,000 (400,000 × 0.9) of those 

applicants will be able to enroll in an 

MSP without providing additional 

income and resource related 

documentation, and without the State 

receiving and adjudicating such data. 

The finalized provisions in 

§ 435.911(e) are associated with a 

reduction in burden for States and 

beneficiaries associated with 

application completion and eligibility 

determinations at the State Medicaid 

agency, including: reduced verification 

work for States that do not need to 

adjudicate the leads data for 

approximately 360,000 new LIS 

applicants; reduced paperwork to 

submit for the LIS applicants applying 

to MSPs in 51 States; reduced burden 

for LIS applicants who were previously 

expected to obtain, print, copy, mail and 

fax documents to the State to support 

the State’s verification of income and 

resources; and reduced LIS applicant 

burden related to the need for public 

transportation and cell phone usage in 

relation to said document activities 

(obtaining, printing, copying, mailing, 

and faxing). 

Reduced Verification Burden. We 

estimate that the finalized provisions in 

§ 435.911(e) will save an Eligibility 

Interviewer 25 minutes (0.42 hr) per 

eligibility determination at $48.10/hr for 

the 360,000 new LIS applicants from 

reduced paperwork to review because of 

the provisions in § 435.952(e) that 

require States to accept self-attestation 

of interest and dividend income, nonliquid resources, burial funds, and the 

face value of life insurance by 

individuals applying to MSPs and the 

reduced verification work due to 

considering the leads data as verified. 

In aggregate, we estimate an annual 

savings of minus 151,200 hours 

(360,000 applicants × 0.42 hr) and 

minus $7,272,720 (151,200 hr × $48.10/ 

hr). Taking into account the 50 percent 

Federal contribution to Medicaid 

program administration, the estimated 

State savings is approximately minus 

$3,636,360 ($7,272,720 × 0.5). 

Reduced LIS Applicant Burden for 

Applying to MSPs. We estimate these 

provisions will reduce the time needed 

for LIS applicants applying to MSPs to 

submit paperwork from 4 hours to 15 

minutes, for a savings of 3.75 hours per 

applicant per year across all 51 States. 

In aggregate, we estimate an annual 

savings of minus 1,350,000 hours 

(360,000 applicants × 3.75 hr) and 

minus $29,673,000 (1,350,000 hr × 

$21.98/hr). 

Reduced Burden for LIS Applicants to 

Support the State’s Verification of 

Income and Resources. We also estimate 

LIS applicant non-labor savings from 

the changes to § 435.911(e) from public 

transportation, printing, copying, 

postage, and fax expenses to be about 

$10 [($4.50 postage for small package or 

$1.75/page for faxing) + $4 roundtrip 

bus ride (from home to printing or 

copying place to post office and back 

home) + $0.13/page for printing or 

copying)] per LIS applicant per year for 

all 51 States (including DC). In 


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57Based on States adjudicating 1.5 million new 

applications and 10 million for redetermination 

annually. 

58We are not including impacts for territories in 

these estimates because territories do not have any 

enrollment in MSPs. 

aggregate, we estimate an annual nonlabor savings of minus $3,600,000 

(360,000 enrollees × $10/enrollee). 

Finalized § 435.952(e)(1) through (4) 

is unchanged from the proposed rule, 

except for applying a delayed 

compliance date of April 1, 2026 for 

States to come into full compliance with 

all of these provisions, and newly 

requiring States to accept self-attestation 

of certain income and resources for MSP 

applicants and beneficiaries—including 

dividend and interest income, burial 

funds of spouse and individual, and the 

face value of life insurance policy 

unless the State has information that is 

not reasonably compatible with the 

applicant’s attestation. Because around 

10 States (including DC) (about 20 

percent of all 51 States, including DC) 

do not have asset tests and do not 

require documentation to complete an 

eligibility determination or 

redetermination at the State Medicaid 

agency, we expect the savings from the 

self-attestation provisions would only 

apply to approximately 8.4 million 

individuals (80 percent of 11 million 

applications/renewals 57 minus 400,000 

individuals who applied to LIS counted 

previously in this final rule) in the other 

41 States. We estimate that under 

§ 435.952(e)(1) through (4), these 8.4 

million individuals will see a reduction 

from 4 hours to 2 hours, for a savings 

of 2 hours per individual, to complete 

an application/renewal in all 41 States. 

In aggregate, we estimate an annual 

savings of minus 16,800,000 hours 

(8,400,000 individuals × 2 hr) and 

minus $369,264,000 (16,800,000 hr × 

$21.98/hr). 

We also estimate the non-labor 

savings under § 435.952(e)(1) through 

(4) to be about $10 [($4.50 postage for 

small package or $1.75/page for faxing) 

+ $4 roundtrip bus ride (to/from post 

office, printing/copying place and 

home) + $0.13/page for printing/ 

copying)] per MSP applicant/renewal 

per year for all 51 States. In aggregate, 

we estimate an annual non-labor savings 

of minus $84,000,000 (8,400,000 

individuals × $10/individual). 

Reduced State Burden for Verification 

of New MSP Applicants. We also 

estimate that § 435.952(e)(1) through (4) 

will save an Eligibility Interviewer 15 

minutes (0.25 hr) per eligibility 

determination or renewal for these 

8,400,000 applicants/beneficiaries. In 

aggregate, we estimate an annual labor 

savings for States of minus 2,100,000 

hours (8,400,000 applications × 0.25 hr) 

and minus $101,010,000 (2,100,000 hr × 

$48.10/hr). Taking into account the 50 

percent Federal contribution to 

Medicaid program administration, the 

estimated State savings is approximately 

minus $50,505,000 ($101,010,000 × 0.5). 

State Burden for Verification of the 

Face Value of Life Insurance. We are 

also finalizing § 435.952(e)(4) to require 

States to develop a verification process 

to determine the cash surrender value of 

life insurance policies over $1,500. We 

anticipate this will be a change for 10 

States in their process for verifying the 

cash surrender value of life insurance 

policies over $1,500. We do not 

anticipate an impact in around 16 States 

that are using authority in section 

1902(r)(2) of the Act to disregard the 

cash surrender value of life insurance in 

whole or part. We estimate that 25 of the 

remaining 35 States (51 States¥16 

States) will choose to use authority in 

section 1902(r)(2) of the Act to disregard 

the cash surrender value of life 

insurance rather than opting to verify 

the cash surrender value of life 

insurance. As noted previously in this 

final rule, we expect that this change 

will only impact 20 percent or 

approximately 10 States (51 States × 

0.2).58 Based on enrollment in past 

years, we anticipate that all 51 States 

will adjudicate 1,000,000 new MSP 

applications a year plus 10 million 

renewals. However, we anticipate this 

policy will only affect 2 percent of 

applicants and beneficiaries, or 44,000 

individuals across 10 States (11,000,000 

individuals × 0.02 of applicants × 0.2 of 

States) because of the small number of 

people who could both afford this type 

of life insurance (which is much more 

expensive than term life insurance) and 

are also likely to apply for MSPs (which 

tends to be lower-income individuals). 

The burden associated with 

§ 435.952(e)(4) will consist of the time 

and effort for eligibility workers in 10 

States to collect information regarding 

the cash surrender value of life 

insurance from 44,000 applicants. The 

savings associated with § 435.952(e)(4) 

consists of eligibility workers in 10 

States not having to spend time 

coaching 44,000 applicants how to 

gather and find information on the cash 

surrender value of life insurance and 

eligibility workers in 10 States not 

having to review life insurance 

documents for individuals with life 

insurance less than $1,500. 

Under § 435.952(e)(4), we estimate 

that it will take an Eligibility 

Interviewer 1 hour at $48.10/hr to verify 

the cash surrender value of each life 

insurance policy over $1,500. In 

aggregate, we estimate an annual burden 

of 44,000 hours (1 hr × 44,000 

individuals) at a cost of $2,116,400 

(44,000 hr × $48.10/hr). Taking into 

account the 50 percent Federal 

contribution to Medicaid program 

administration, the estimated State 

share is approximately $1,058,200 

($2,116,400 × 0.5). 

Reduced State Burden for Verification 

of the Face Value of Life Insurance. We 

estimate the changes under 

§ 435.952(e)(4) will save Eligibility 

Interviewers an average 45 minutes 

(0.75 hr) per applicant from not needing 

to coach applicants on how to gather 

and find information on the cash 

surrender value of life insurance. In 

aggregate, we estimate an annual 

savings of minus 33,000 hours (44,000 

applicants × 0.75 hr) and $1,587,300 

(33,000 hr × $48.10/hr). Taking into 

account the 50 percent Federal 

contribution to Medicaid program 

administration, the estimated State 

savings is approximately minus 

$793,650 ($1,587,300 × 0.5). 

We also estimate State savings under 

§ 435.952(e)(4) from eligibility workers 

not having to review life insurance 

documents for individuals with life 

insurance less than $1,500. We 

anticipate it will take an eligibility 

worker about 10 minutes (0.167 hr) to 

review a life insurance document and 

that this savings will affect 3 percent or 

66,000 applicants and beneficiaries or 

individuals (11,000,000 individuals × 

0.03 × 0.2) across 10 States. In aggregate, 

we estimate an annual savings of minus 

11,022 hours (66,000 individuals × 

¥0.167 hr) and minus $530,158 (¥ 

11,022 hr × $48.10/hr). Taking into 

account the 50 percent Federal 

contribution to Medicaid program 

administration, the estimated State 

savings is approximately minus 

$265,079 ($530,158 × 0.5). 

As indicated in Table 3, we estimate 

a net State annual burden reduction of 

minus 2,091,222 hours and minus 

$50,293,889. 


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TABLE 3—SUMMARY OF STATE BURDEN FOR FACILITATING MEDICAID ENROLLMENT THROUGH LIS LEADS DATA AND SELFATTESTATION PROVISIONS

Regulation 

section(s) 

Number of 

respondents 

Total 

number of 

responses 

Time per 

response 

(hours) 

Total time 

(hours) 

Hourly labor 

cost 

($/hr) 

Total labor 

cost 

($) 

Total 

state share 

($) 

Total 

non-labor 

cost 

($) 

Frequency 

§ 435.911 ................ 51 States ................ 400,000 0.25 100,000 48.10 4,810,000 2,405,000 0 Annual 

§ 435.911 ................ 51 States ................ 60,000 1 60,000 48.10 2,886,000 1,443,000 0 Annual. 

§§ 435.911 and 

435.952.

51 States ................ (7,059) 0.42 (151,200) 48.10 (7,272,720) (3,636,360) 0 Annual. 

§ 435.952 ................ 51 States ................ (8,400,000) 0.25 (2,100,000) 48.10 (101,010,000) (50,505,000) 0 Annual. 

§ 435.952 ................ 10 States ................ 4,400 1 44,000 48.10 2,116,400 1,058,200 0 Annual. 

§ 435.952 ................ 10 States ................ (4,400) 0.75 (33,000) 48.10 (1,587,300) (793,550) 0 Annual. 

§ 435.952 ................ 10 States ................ (6,600) 0.167 (11,022) 48.10 (530,158) (265,079) 0 Annual. 

Total ................ 51 States ................ (7,953,659) Varies (2,091,222) 48.10 (100,587,778) (50,293,889) 0 Annual. 

As indicated in Table 4, for 

individuals, we estimate an annual 

burden reduction of minus 17,910,000 

hours and minus $481,261,800. 

TABLE 4—SUMMARY OF INDIVIDUAL BURDEN FOR FACILITATING MEDICAID ENROLLMENT THROUGH LIS LEADS DATA AND

SELF-ATTESTATION PROVISIONS

Regulation 

section(s) 

Number of 

respondents 

Total number 

of responses 

Time per 

response 

(hours) 

Total time 

(hours) 

Hourly 

labor 

cost 

($/hr) 

Total 

labor cost 

($) 

Total 

state share 

($) 

Total 

non-labor cost 

($) 

Frequency 

§ 435.911 ............ 60,000 individuals ....... 60,000 4 ........... 240,000 21.98 5,275,200 0 5,275,200 Annual 

§§ 435.911 and 

435.952.

360,000 individuals ..... (360,000) (3.75) .... (1,350,000) 21.98 (29,673,000) 0 (29,673,000) Annual. 

§§ 435.911 and 

435.952.

360,000 individuals ..... (360,000) 0 ........... n/a n/a ..... 0 (3,600,000) (3,600,000) Annual. 

§ 435.952 ............ 8,400,000 individuals .. (8,400,000) (2) ......... (16,800,000) 21.98 (369,264,000) 0 (369,264,000) Annual. 

§ 435.952 ............ 8,400,000 individuals .. (8,400,000) 0 ........... n/a n/a ..... 0 (84,000,000) (84,000,000) Annual. 

Total ............ 8,820,000 individuals .. (17,580,000) Varies ... (17,910,000) Varies (393,661,800) (87,600,000) (481,261,800) Annual. 

When combined (see Table 5), we 

estimate an annual burden reduction of 

minus 20,001,222 hours and minus 

$531,555,689. 

TABLE 5—SUMMARY OF STATE AND INDIVIDUAL BURDEN FOR FACILITATING MEDICAID ENROLLMENT THROUGH LIS LEADS

DATA AND SELF-ATTESTATION PROVISIONS

Respondent type Number of 

respondents 

Total number 

of responses 

Total time 

(hours) 

Hourly 

labor cost 

($/hr) 

Labor cost 

($) 

Non-labor cost 

($) 

Total cost 

($) Frequency 

States ............................................... 51 (7,953,659) (2,091,222) Varies ....... (50,293,889) 0 (50,293,889) Annual. 

Individuals ........................................ 8,760,000 (17,580,000) (17,910,000) Varies ....... (393,661,800) (87,600,000) (481,261,800) Annual. 

Total .......................................... 8,820,051 (25,533,659) (20,001,222) Varies ....... (443,955,689) (87,600,000) (531,555,689) Annual. 

2. Defining ‘‘Family of the Size 

Involved’’ for the Medicare Savings 

Program Groups Using the Definition of 

‘‘Family Size’’ in the Medicare Part D 

Low-Income Subsidy Program 

As described in section II.A.2. of this 

final rule, § 435.601 aligns the definition 

of ‘‘family size’’ for purposes of MSP 

eligibility with that of the LIS program. 

Specifically, we newly define ‘‘family of 

the size involved’’ to include at least the 

individuals included in the definition of 

‘‘family size’’ in the LIS program: the 

applicant, the applicant’s spouse, and 

all other individuals living in the same 

household who are related to and 

dependent on the applicant or 

applicant’s spouse. While some States 

either already define family size to 

match the LIS definition or use a family 

size that is less restrictive than this 

definition, we estimated in the proposed 

rule that 10 States use SSI 

methodologies to determine family size, 

which means that these States only use 

an individual or couple and any other 

deemed individuals as part of the family 

size. As such, we estimated in the 

proposed rule that 10 States will need 

to submit a SPA to change their 

definition of family size for MSP 

eligibility groups to comply with this 

regulation. However, based on 

subsequent internal analysis, we believe 

our proposed estimate of 10 States was 

too low and that 35 States may be 

impacted by the changes to this 

definition of family size. As such, we 

have revised our active estimate to 

reflect a higher impact. 

We estimate that it will take each 

State 3 hours to submit a SPA to update 

the definition of ‘‘family size’’ in their 

Medicaid State plans. Of those 3 hours, 

we estimate it will take a Business 

Operations Specialist 2 hours at $80.08/ 

hr and a General Operations Manager 1 

hour at $118.14/hr to update and submit 

each SPA to CMS for review. In 

aggregate, we estimate a one-time 

burden of 105 hours (35 States × 3 hr) 

at a cost of $9,741 (35 States × [2 hr × 

$80.08/hr] + [1 hr × $118.14/hr]) for 

completing the necessary SPA updates. 


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Taking into account the 50 percent 

Federal contribution to Medicaid 

program administration, the estimated 

State cost is approximately $4,871 

($9,741 × 0.5). Under § 423.772, ‘‘family 

size’’ is defined to include the 

applicant, the applicant’s spouse (if the 

spouse is living in the same household 

with the applicant), and all other 

individuals living in the same 

household who are related to the 

applicant and dependent on the 

applicant or applicant’s spouse for onehalf of their financial support. By 

requiring that a State’s definition of 

‘‘family of the size involved’’ include 

‘‘at least’’ the individuals described in 

§ 423.772 for purposes of the MSP 

groups, States would retain flexibility to 

include other individuals who are not 

described in § 423.772. Additionally, 

this requirement would not affect the 

States’ ability to adopt a different 

reasonable definition of the phrase for 

purposes of other eligibility groups. 

As such, we estimate that it will take 

each State on average 200 hours to 

develop questions and code the changes 

to its Medicaid application(s) to identify 

other third parties in the households of 

MSP applicants. These changes will 

impact any of the State’s applications 

that focus on non-MAGI eligibility 

groups only and do not collect 

information about other household 

members. As such, it would apply to 

both a non-MAGI-only application or an 

MSP-only application. On the other 

hand, a single streamlined application 

that individuals use to apply both to 

Medicaid and the Marketplace already 

captures information about third parties 

in the applicant’s household and would 

not be impacted. We will be revising the 

model MSP-only form to take into 

account these changes to family size, 

which States have the option to use as 

well. As such, each individual State 

may have greater or lesser impact 

depending on what application form(s) 

it uses. Of the 200 hours, we estimate it 

will take a Database and Network 

Administrator and Architect 50 hours at 

$106.16/hr and a Computer Programmer 

150 hours at $98.84/hr. In aggregate, we 

estimate a one-time burden of 7,000 

hours (35 States × 200 hr) at a cost of 

$704,690 (35 States × [(50 hr × $106.16/ 

hr) + (150 hr × $98.84/hr)]) for 

completing the necessary updates to the 

Medicaid application. Taking into 

account the 50 percent Federal 

contribution to Medicaid program 

administration, the estimated State cost 

is approximately $352,345 ($704,690 × 

0.5). 

These changes do not revise or create 

additional burden on applicants as the 

new questions will be in lieu of prior 

questions regarding ‘‘family size.’’ As 

such, the removed/added questions 

require programming changes that have 

a neutral impact on applicants. 

Summary: As demonstrated in Table 

6, when taking into account the Federal 

contribution, we estimate a one-time 

State burden of 7,105 hours at a cost of 

$357,216. 

TABLE 6—SUMMARY OF STATE BURDEN FOR MSP FAMILY SIZE DEFINITION CHANGES

Regulation section(s) Number of 

respondents 

Total 

number of 

responses 

Time per 

response 

(hours) 

Total time 

(hours) 

Hourly 

labor cost 

($/hr) 

Total labor 

cost 

($) 

Total state 

share 

($) 

Total 

non-labor 

cost 

($) 

Frequency 

§ 435.601 .............................. 35 States ........... 35 3 105 Varies ....... 9,741 4,871 0 One time. 

§ 435.601 .............................. 35 States ........... 35 200 7,000 Varies ....... 704,690 352,345 0 One time. 

Total .............................. 35 States ........... 70 203 7,105 Varies ....... 714,431 357,216 0 One time. 

MSP Enrollment Increases as a Result of 

Facilitating Enrollment Through 

Medicare Part D LIS Leads Data 

To calculate the impact of 

streamlining enrollment for persons in 

the LIS program, we analyzed data from 

the Medicare Integrated Data Repository 

(IDR) from July 2020. We determined 

the number of people who were 

enrolled in the LIS program by: (1) 

State; (2) the category of LIS benefit they 

received; and (3) whether or not they 

were also enrolled in Medicaid. We 

identified 13.1 million persons 

receiving the Part D LIS, of which 11.1 

million were enrolled in Medicaid and 

2.0 million were not. 

We developed a regression using the 

percentage of LIS enrollees who were 

also dually eligible as the dependent 

variable, and used several policy factors 

as independent variables: State use of 

LIS leads data to make MSP eligibility 

determinations; verification policies and 

procedures; grace period for providing 

verifications after initial denial; 

redetermination grace period; counting 

children towards income; income 

disregard; and asset disregard. While the 

latter three policies would not change 

under this final rule, we believed that 

they may explain some of the variation 

in the percentage of LIS recipients who 

are dually eligible. We found that this 

model explained some amount of the 

variation in the percentage of LIS 

enrollees who are enrolled as dually 

eligible, and that the most significant 

variable was the State use of LIS leads 

data to make MSP eligibility 

determinations. Other policies appeared 

to have weak correlations. The model 

suggested that the use of these 

policies—and in particular the use of 

the Part D LIS leads data—would result 

in an average increase in the percentage 

of LIS recipients who are dually eligible 

from 84.6 percent to 88.0 percent (an 

increase of 3.4 percentage points). We 

estimated that about 0.44 million 

additional persons would have been 

enrolled in the QMB eligibility group as 

a result of these changes, had they been 

made in 2020. We assume that the 

increase in enrollment will be among 

people who do not qualify for full 

Medicaid benefits. 

We assumed these enrollees, as 

QMBs, would receive coverage of their 

Medicare Part B premium. The premium 

is $164.90 per month in 2023. We also 

assumed that beneficiaries would 

receive Medicaid coverage for cost 

sharing for Medicare services. 

To calculate future impacts to 

enrollment, we assumed that the 

increase in enrollment due to this 

provision would grow at the same rate 

as Medicaid enrollment among aged 

persons and persons with disabilities. 

We estimate that this would increase 

enrollment by about 0.54 million 

persons by FY 2029 and would increase 

total Medicaid spending for Medicaid 

coverage of Medicare premiums and 

cost sharing by $6.26 billion from FY 

2025 through FY 2029. Detailed 

estimates are shown in Table 7. 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65263 

TABLE 7—IMPACT OF FACILITATING MEDICAID ENROLLMENT THROUGH MEDICARE PART D LIS LEADS DATA ON MEDICAID

EXPENDITURES AND ENROLLMENT

[Expenditures in millions of dollars, enrollment in millions of person-year equivalents] 

2025 2026 2027 2028 2029 2025–2029 

Enrollment ................................................ 0.12 0.38 0.52 0.53 0.54 ........................

Total Spending ......................................... 380 1,160 1,560 1,570 1,590 6,260 

Federal Spending ..................................... 220 670 900 900 920 3,610 

3. Automatically Enroll Certain SSI 

Recipients Into the QMB Group 

As described in section II.A.3. of this 

final rule, § 435.909 newly requires that 

States deem certain individuals who are 

eligible for Medicare Part A, and who 

are SSI beneficiaries eligible for QMB 

coverage, without requiring an 

application. In particular, § 435.909 

newly requires that: (1) States with 1634 

agreements must deem SSI recipients 

eligible for QMB coverage who are 

entitled to premium-free Medicare Part 

A; (2) States without 1634 agreements 

must deem SSI recipients eligible for 

QMB coverage who are entitled to 

premium-free Medicare Part A and have 

been determined eligible for Medicaid 

under either § 435.120 or § 435.121; and 

(3) Part A buy-in States must deem 

individuals eligible for QMB coverage if 

the individual is determined eligible for 

Medicaid under either § 435.120 or 

§ 435.121, entitled to SSI, only qualifies 

for premium Part A, and is enrolled in 

Part B. 

To implement these new 

requirements, States will need to 

identify Medicare-eligible SSI recipients 

to enroll them in the MSPs. States will 

also need to trigger deeming of 

Medicare-eligible SSI recipients to QMB 

by making eligibility systems changes to 

trigger QMB enrollment once the SSIindividual is Medicare eligible. Current 

regulations do not allow State Medicaid 

agencies to forgo an eligibility 

determination for Medicaid 

beneficiaries who are eligible for SSI 

when they become newly eligible for 

Medicare Part A and B. Therefore, this 

new requirement will require system 

changes for all 51 States (including DC). 

While these deeming provisions are 

intended to enroll more SSI recipients 

in QMB, this rulemaking will not reach 

all SSI recipients eligible for QMB. We 

estimate currently 16 percent or 566,556 

(3,540,975 × 0.16) SSI recipients are 

eligible but not enrolled in QMB, and 

nearly 500,000 new SSI recipients who 

are enrolled in Medicaid under either 

§ 435.120 or § 435.121 will enroll in 

QMB as a result of the changes to 

§ 435.909(b). 

As discussed in section II.A.3. of this 

final rule, in the 34 States with a 1634 

agreement, the Medicaid agency 

automatically enrolls the SSI recipients 

in Medicaid following a data exchange 

with SSA and then we automatically 

initiate Part B buy-in for the individual 

through the ‘‘buy-in data exchange.’’ In 

the remaining States, individuals must 

submit a separate application to the 

State Medicaid agency to be determined 

eligible for Medicaid. 

We do not automatically initiate Part 

B buy-in for SSI individuals who live in 

SSI criteria and 209(b) States; rather, 

States must initiate Part B buy-in once 

the SSI recipient has separately applied 

for and been determined eligible for the 

mandatory SSI or 209(b) group. 

Additionally, SSI recipients who live in 

group payer States and are eligible for 

premium Part A are still required to go 

through a complicated two-step 

application process to establish QMB 

eligibility once an individual is 

determined eligible for the mandatory 

SSI or 209(b) groups and has been 

enrolled in Part B pursuant to the State’s 

buy-in agreement. 

Under this final rule, the application 

process for SSI recipients who live in 

criteria and 209(b) States will remain 

the same and so will the two-step 

application process to establish QMB 

eligibility for SSI recipients living in 

group payer States and having premium 

part A. 

Based on SSA data and internal CMS 

analysis of the 566,556 SSI recipients 

eligible for QMB but not enrolled, we 

estimate almost 83 percent (469,820 = 

566,556 × 0.829257) were likely eligible 

for premium-free Part A, while 

approximately 17 percent (96,736 = 

566,556 × 0.170744) were eligible for 

premium Part A. Of the 469,820 who 

were eligible for premium-free Part A, 

we estimate that approximately 86 

percent (405,963 = 469,820 × 0.864082) 

reside in States with 1634 agreements, 

and approximately 14 percent (63,857 = 

469,820 × 0.135918) reside in 209(b) or 

SSI criteria States. Because Medicaid is 

automatic in States with 1634 

agreements, we estimate that 405,963 

individuals (all of the previouslymentioned SSI recipients in 1634 States) 

will be automatically enrolled in QMB 

under this new provision. 

In contrast, we estimate that only 65 

percent of the previously-mentioned 

63,857 SSI recipients in 209(b) States or 

SSI criteria States, or 41,507 individuals 

(63,857 individuals × 0.65), will be 

enrolled under the new provision. This 

is because it is unlikely that all SSI 

recipients who live in SSI or 209(b) 

States will complete the Medicaid 

application process in their State. 

Of the 96,736 individuals eligible for 

premium Part A, we estimate 33 percent 

(31,923 = 96,736 × 0.33) are in Part A 

buy-in States and 67 percent (64,813 = 

96,736 × 0.67) of those eligible for 

premium Part A are in group payer 

States, where deeming will be optional. 

We estimate that 95 percent (30,327 = 

31,923 × 0.95) of individuals in Part A 

buy-in States who are eligible for 

premium Part A will enroll as a result 

of the new provision because we 

estimate that all of those individuals 

live in States with 1634 agreements. 

However, for the individuals eligible for 

premium Part A in group payer States 

where deeming will be optional, we 

expect some more populous States will 

use this option, so we are estimating 33 

percent (21,388 = 64,813 × 0.33) of all 

individuals with premium Part A living 

in group payer States will newly enroll. 

Therefore, we estimate a total of 

499,185 individuals (405,963 + 41,507 + 

30,327 + 21,388) will newly enroll 

without the need to complete an 

application. We estimate that those 

individuals will each save 2 hours from 

not filling out Medicaid applications 

and compiling associated 

documentation (going from 2 to 0 hours) 

at $21.98/hr. We estimate an annual 

savings of minus 998,370 hours 

(499,185 individuals × 2 hr) and minus 

$21,944,173 (998,370 hr × $21.98/hr). 

All 51 States (including DC) will need 

to make eligibility systems changes to 

deem an SSI individual in QMB once 

they are eligible for Medicare. We 

estimate it will take a Computer 

Programmer an average of 180 hours per 

State at $98.84/hr to make systems 

changes to set their systems to search for 

Medicare eligibility in Federal systems 

and then enroll that individual in QMB. 

In aggregate, we estimate a one-time 

burden of 9,180 hours (51 States × 180 


ddrumheller on DSK120RN23PROD with RULES2
65264 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

59https://www.census.gov/content/dam/Census/ 

library/publications/2021/demo/p70br-171.pdf. 

hr) at a cost of $907,351 (9,180 hr × 

$98.84/hr). Taking into account the 50 

percent Federal contribution to 

Medicaid program administration, the 

estimated State share is approximately 

$453,676 ($907,351 × 0.5). 

We also estimate that this provision 

will result in an annual reduction of 

burden for the State to no longer review 

and adjudicate QMB applications from 

SSI recipients. We estimate this will 

save an Eligibility Interviewer 1 hour 

(going from 1 hour to 0) per QMB 

determination at $48.10/hr. We also 

estimate that States conduct QMB 

eligibility determinations for 

approximately 250,000 SSI individuals 

across 51 States, which will no longer 

be necessary. In aggregate, we estimate 

an annual burden savings of minus 

250,000 hours (250,000 individuals × 

¥1 hr/response) and minus $12,025,000 

(¥250,000 hr × $48.10/hr). Taking into 

account the 50 percent Federal 

contribution to Medicaid program 

administration, the estimated State 

savings is approximately minus 

$6,012,500 ($12,025,000 × 0.5). 

Summary: As demonstrated in Table 

8, when taking into account the Federal 

contribution, we estimate a State 

savings of minus 240,820 hours and 

minus $5,558,824. We also estimate 

individual savings of minus 998,370 

hours minus $21,944,173. 

TABLE 8—SUMMARY OF STATE AND INDIVIDUAL BURDEN FOR AUTOMATIC ENROLLMENT OF CERTAIN SSI RECIPIENTS INTO

QMB 

Regulation 

section(s) 

Number of 

respondents 

Total 

number of 

responses 

Time per 

response 

(hours) 

Total time 

(hours) 

Hourly 

labor cost 

($/hr) 

Total labor 

cost 

($) 

Total state 

share 

($) 

Total 

non-labor cost 

($) 

Frequency 

§ 435.909 ................ 51 States .......... 51 180 ........... 9,180 98.84 ........ 907,351 453,676 0 One-time. 

§ 435.909 ................ 51 States .......... (250,000) (1) ............. (250,000) 48.10 ........ (12,025,000) (6,012,500) 0 Annual. 

Subtotal: States 51 States .......... (249,949) Varies ....... (240,820) Varies ....... (11,117,649) (5,558,824) 0 Varies. 

§ 435.909 ................ 499,185 individuals.(499,185) (2) ............. (998,370) 21.98 ........ (21,944,173) n/a 0 Annual. 

Total .......... 499,236 ............ (749,134) Varies ....... (1,239,190) Varies ....... (33,061,822) (5,558,824) 0 Varies. 

QMB Enrollment Increases as a Result of 

Automatically Enrolling Certain SSI 

Recipients Into the QMB Group 

To calculate the impact of 

automatically enrolling SSI recipients 

into QMB Medicaid coverage, we 

examined data on SSI recipients and 

their health care coverage.59 As of 2017, 

about 17 percent of all SSI recipients 

had Medicare coverage but were not 

dually enrolled in Medicaid. 

First, we estimated how many persons 

would enroll who already receive 

Medicare Part A without paying a 

premium. We estimated that there are 

2.6 million people enrolled in SSI who 

are enrolled in Part A and do not pay 

the premium. Of these, we estimated 

about 82 percent reside in ‘‘1634 States’’ 

(about 2.1 million) and therefore are 

automatically enrolled in Medicaid. Of 

the remaining 0.48 million, we have 

assumed that 90 percent would enroll in 

the QMB group and receive Medicare 

Part B premium and cost-sharing 

assistance. We estimated those benefits 

to be about $5,000 per enrollee per year 

for 2023. 

Second, we estimated how many 

persons would enroll who receive 

Medicare Part A but have to pay a 

premium. We estimate that there are 5.2 

million such people enrolled in SSI. We 

estimated that 34 percent of this 

population lives in States that do not 

automatically enroll these individuals 

in the QMB group. Of States that do not 

automatically enroll these individuals 

in the QMB group, we assumed that 

about 20 percent of States would use the 

option provided in this final rule, and 

that about 50 percent of this population 

would be enrolled in the QMB group as 

a result. 

Third, we also considered that many 

of these individuals are already enrolled 

as dually eligible in Medicare and 

Medicaid, but not as QMBs. For current 

dually eligible individuals, we assumed 

that they were already receiving 

Medicaid coverage for the Part B 

premium and most Medicare cost 

sharing. For those not currently enrolled 

as a dually eligible, we assumed that 

they would be eligible for Medicaid to 

pay for the Part B premium and 

Medicare cost sharing, and the Part A 

premium if they are required to pay it. 

We estimated that 75 percent of new 

QMBs were already enrolled as dually 

eligible. 

To calculate future impacts to 

enrollment, we assumed that the 

increase in enrollment due to this 

provision would grow at the same rate 

as Medicaid enrollment among aged 

persons and persons with disabilities. 

We estimate that this provision would 

increase QMB enrollment among 

persons who are not currently dually 

eligible by 0.16 million by FY 2029. We 

also estimate about 0.50 million 

additional QMBs who are already dually 

eligible, of whom 0.14 million would 

have their Part A premiums paid by 

Medicaid under this provision. We 

estimate that this provision would 

increase total Medicaid spending by 

$10.23 billion from FY 2025 through FY 

2029 for Medicaid coverage of Medicare 

premiums and cost sharing and, in some 

cases, other Medicaid benefits. Detailed 

estimates are shown in Table 9. 

TABLE 9—IMPACT OF AUTOMATICALLY ENROLLING CERTAIN SSI RECIPIENTS INTO QMB PROGRAM ON MEDICAID

EXPENDITURES AND ENROLLMENT

[Expenditures in millions of dollars, enrollment in millions of person-year equivalents] 

2025 2026 2027 2028 2029 2025–2029 

Additional QMB Enrollees ........................ 0.28 0.30 0.30 0.30 0.30 ........................

Previous Dual Eligibles ............................ 0.13 0.14 0.14 0.14 0.14 ........................

New Medicaid Enrollees .......................... 0.15 0.16 0.16 0.16 0.16 ........................

Total Spending ......................................... 2,010 2,020 2,040 2,060 2,100 10,230 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65265 

60B Garrett, A Gangopadhyaya, A Shartzer, and 

D Arnos, ‘‘A Unified Cost-Sharing Design for 

Medicare: Effects on Beneficiary and Program 

Spending,’’ The Urban Institute, July 2019. https:// 

www.urban.org/sites/default/files/publication/ 

100528/a_unified_cost-sharing_design_for_

medicare_effects_on_beneficiary_an_1.pdf. 

61W Koma, J Cubanski, and T Neuman, ‘‘A 

Snapshot of Coverage Among Medicare 

Beneficiaries in 2018,’’ Kaiser Family Foundation, 

March 23 2021. https://www.kff.org/medicare/issuebrief/a-snapshot-of-sources-of-coverage-amongmedicare-beneficiaries-in-2018/. 

TABLE 9—IMPACT OF AUTOMATICALLY ENROLLING CERTAIN SSI RECIPIENTS INTO QMB PROGRAM ON MEDICAID

EXPENDITURES AND ENROLLMENT—Continued 

[Expenditures in millions of dollars, enrollment in millions of person-year equivalents] 

2025 2026 2027 2028 2029 2025–2029 

Federal Spending ..................................... 1,150 1,160 1,170 1,190 1,200 5,870 

4. Other Provisions To Facilitate 

Medicaid Enrollment 

For other provisions that would 

facilitate Medicaid enrollment 

(including the definition of family size; 

and making the QMB effective date 

earlier), we assumed that these 

provisions would increase enrollment 

by about 0.1 percent among aged 

enrollees and enrollees with disabilities 

and would have a negligible impact on 

other categories of enrollees. We 

estimate that this would increase 

enrollment by about 0.02 million 

person-year equivalents by 2029. These 

provisions are estimated to increase 

Medicaid spending by $2.07 billion 

from FY 2025 through FY 2029 for 

Medicaid coverage of Medicare 

premiums and cost sharing and, in some 

cases, other Medicaid benefits. Detailed 

estimates are shown in Table 10. 

TABLE 10—IMPACT OF OTHER PROVISIONS TO FACILITATE ENROLLMENT ON MEDICAID EXPENDITURES AND ENROLLMENT

[Expenditures in millions of dollars, enrollment in millions of person-year equivalents] 

2025 2026 2027 2028 2029 2026–2029 

Enrollment ................................................ 0.01 0.02 0.02 0.02 0.02 0.02 

Total Spending ......................................... 120 380 510 530 530 2,070 

Federal Spending ..................................... 70 220 290 300 310 1,190 

5. Impacts on Medicare 

It is likely that those SSI enrollees 

newly gaining Medicaid coverage would 

also have higher Medicare costs 

following enrollment. Primarily, 

receiving cost-sharing assistance for 

Medicare would lead to these 

individuals seeking out more care that 

may have been difficult to afford 

previously, also known as induction. 

To estimate these impacts, we 

reviewed research on the effects of 

changing out-of-pocket costs on total 

health care costs, and specifically on 

Medicare. In general, we have 

historically estimated that reductions in 

out-of-pocket costs would increase total 

spending by $0.60 to $1.30 for every 

$1.00 reduction in out-of-pocket costs. 

Among research on health care costs, we 

relied primarily on research that 

examined the impacts on changing 

Medicare out-of-pocket costs.60

This research is useful, particularly 

because of the analysis reviewing costsharing among those Medicare enrollees 

without any other coverage, those with 

supplemental coverage (such as 

‘‘Medigap’’ plans or retiree health 

benefits), and those with Medicaid. 

First, the analysis found that Medicare 

enrollees without other coverage had an 

average of $13,693 in costs, of which 

$2,399 was paid out of pocket (18 

percent). Among those with 

supplemental coverage, average costs 

were $14,349, with $594 paid out of 

pocket (4 percent) and $2,095 paid 

through supplemental coverage (15 

percent). Enrollees with Medicaid 

coverage had $26,181 in average costs, 

with $209 paid out of pocket (1 percent) 

and $3,190 paid by Medicaid (12 

percent). A significant amount of cost 

differences is likely due to health status. 

Most notably, those with Medicaid 

coverage are on average older and more 

likely to have a disability or chronic 

condition, which would result in higher 

costs regardless of who pays for care. 

The analysis also examines the effect 

of changing Medicare cost-sharing 

structures on total, Medicare, and outof-pocket spending. While the specific 

proposed benefit changes are not related 

to this final rule, it does provide the 

relative magnitude of changes between 

Medicare and out-of-pocket costs. The 

analysis found a larger change in costs 

for those without any other coverage 

than those with supplemental coverage. 

For those without other coverage, outof-pocket costs decreased by $428 while 

total costs increased by $764 (or $1.80 

for every $1.00 reduction in out-ofpocket costs). For those with 

supplemental coverage, there was a 

decrease of $158 in out-of-pocket costs 

and an increase of $130 in total costs (or 

$0.80 for every $1.00 reduction in outof-pocket costs). 

We also reviewed how many 

Medicare enrollees have supplemental 

coverage or Medicaid. Research from the 

Kaiser Family Foundation recently 

looked at this.61 This analysis found 

that 26 percent of Medicare 

beneficiaries had annual income of less 

than $20,000 (which is reasonably close 

to the SSI income limit of $1,767 

monthly, which would be $21,204 

annually). Of these beneficiaries, 37 

percent had Medicaid and 11 percent 

had supplemental coverage. Excluding 

those with Medicaid and assuming the 

two groups are mutually exclusive, 17 

percent of low-income beneficiaries 

without Medicaid had supplemental 

coverage. We believe it is reasonable to 

assume that very few beneficiaries had 

both Medicaid and other supplemental 

coverage. 

We estimated the impact assuming 

that the overall increase in total costs 

would be $0.80 for every $1.00 

reduction in out-of-pocket costs. For 

those without supplemental coverage, 

this would be expected to result in an 

increase of 14 percent in total costs and 

20 percent in Medicare costs, and for 

those without supplemental coverage, 

increases of 3 percent for total costs and 

10 percent for Medicare costs. Using the 

analysis on SSI enrollees and coverage, 

this is a weighted average of an 18 

percent increase in Medicare costs for 

those newly gaining Medicaid. 


ddrumheller on DSK120RN23PROD with RULES2
65266 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

62 ‘‘2022 Annual Report of the Boards of Trustees 

of the Federal Hospital Insurance and Federal 

Supplementary Medical Insurance Trust Funds.’’ 

https://www.cms.gov/files/document/2022- 

medicare-trustees-report.pdf. 

To calculate the annual impacts, we 

multiply the Medicare per enrollee costs 

each year by 18 percent and by the 

number of SSI enrollees newly receiving 

Medicaid, and then adjust for costsharing to calculate the Federal 

Medicare spending amounts. This 

excludes those who were previously 

dually eligible but not QMBs. Using 

total Medicare per enrollee costs (as 

projected in the 2022 Trustees 

Report 62), we project that this would 

increase Medicare spending by $7.6 

billion over 2025 to 2029 under this 

final rule. Annual impacts are shown in 

Table 11. 

TABLE 11—PROJECTED CHANGE IN

MEDICARE EXPENDITURES FROM ADDITIONAL SSI ENROLLEES RECEIVING

MEDICAID

[In millions of real dollars] 

Medicare 

expenditures 

2025 ...................................... 600 

2026 ...................................... 1,400 

2027 ...................................... 1,800 

2028 ...................................... 1,900 

2029 ...................................... 1,900 

Total ............................... 7,600 

There is a wide range of possible costs 

due to this effect of this final rule. Most 

notably, and described previously in 

this section, is that the impact of 

reducing out-of-pocket costs could have 

different impacts than estimated here. 

Thus, individuals could use greater or 

lesser levels of additional services, 

resulting in different levels of Medicare 

spending changes than estimated here. 

This uncertainty is addressed in the 

high and low range estimates provided 

in the accounting statement (see section 

IV.F. of this final rule). 

6. Summary of Administrative Impacts 

Table 12 summarizes this rule’s 

requirements and associated burden 

estimates. 


ddrumheller on DSK120RN23PROD with RULES2
Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65267 

TABLE 12—SUMMARY OF

ADMINISTRATIVE

ESTIMATES

Regulation section(s) Number of respondents Total number of responses Time per response (hours) Total time (hours) Hourly labor cost ($/hr) Total labor cost ($) Total state share ($) Total beneficiary cost ($) Total non-labor cost ($) Frequency 

§ 435.601 .................................. 35 States .................................. 35 200 ................. 7,000 Varies 704,960 352,345 n/a n/a One-Time. § 435.909 .................................. 499,185 individuals .................. 499,185 (2) ................... (998,370) 21.98 n/a n/a (21,944,173) n/a Annual. § 435.909 .................................. 51 States .................................. 51 180 ................. 9,180 98.84 907,351 453,676 n/a n/a One-Time. § 435.909 .................................. 51 States .................................. 250,000 (1) ................... (250,000) 48.10 (12,025,000) (6,012,500) n/a n/a Annual. § 435.911 .................................. 51 States .................................. 400,000 0.25 ................ 100,000 48.10 4,810,000 2,405,000 n/a n/a Annual. § 435.911 .................................. 51 States .................................. 60,000 1 ..................... 60,000 48.10 2,886,000 1,443,000 n/a n/a Annual. § 435.911 .................................. 60,000 individuals .................... 60,000 4 ..................... 240,000 21.98 5,275,200 0 5,275,200 n/a Annual. §§ 435.911, and 435.952 .......... 360,000 individuals .................. 360,000 (3.75) .............. (1,350,000) 21.98 n/a n/a (29,673,000) n/a Annual. §§ 435.911, and 435.952 .......... 360,000 individuals .................. 360,000 0 ..................... n/a n/a n/a n/a n/a (3,600,000) Annual. § 435.952 .................................. 51 States .................................. 8,400,000 (2) ................... (16,800,000) 21.98 n/a n/a (369,264,000) n/a Annual. § 435.952 .................................. 8,400,000 ................................. 8,400,000 0 ..................... n/a n/a n/a n/a n/a ¥(84,000,000) Annual. § 435.911, and 435.952 ............ 51 States .................................. 7,059 (0.42) .............. (151,200) 48.10 (7,272,720) (3,636,360) n/a n/a Annual. § 435.952 .................................. 51 States .................................. 8,400,000 (0.25) .............. (2,100,000) 48.10 (101,010,000) (50,505,000) n/a n/a Annual. § 435.952 .................................. 10 States .................................. 4,400 1 ..................... 44,000 48.10 2,116,400 1,058,200 n/a n/a Annual. § 435.952 .................................. 10 States .................................. 4,400 (0.75) .............. (33,000) 48.10 (1,587,300) (793,550) n/a n/a Annual. § 435.952 .................................. 10 States .................................. 6,600 (0.167) ............ (11,022) 48.10 (530,158) (265,079) n/a n/a Annual. 

Subtotal .............................. 9,679,185 ................................. 27,211,730 Varies ............. (21,233,412) Varies (105,725,267) (55,500,268) (415,605,973) ¥(87,600,000) Varies. 

§ 435.601 .................................. 35 States .................................. 1 3 ..................... 105 Varies 9,741 4,871 n/a n/a One-Time. 

Subtotal .............................. 35 States .................................. 1 3 ..................... 105 Varies 9,741 4,871 n/a n/a One-Time. 

Total—annual (21,249,592) ........................ (107,337,578) (56,306,289) (415,605,973) (87,600,000) Total—onetime. 16,285 ........................ 1,622,052 810,892 n/a n/a 


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65268 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

7. Summary of Medicaid Spending and 

Enrollment 

In total, these provisions are projected 

to increase Medicaid spending by 

$18.56 billion and Federal Medicaid 

spending by $10.67 billion from 2025 

through 2029. Medicaid enrollment is 

projected to increase by 0.70 million by 

2029, with an additional 0.16 million 

individuals who are currently dually 

eligible gaining coverage as QMBs. 

TABLE 13—IMPACT OF ALL PROVISIONS ON MEDICAID EXPENDITURES AND ENROLLMENT

[Expenditures in millions of dollars, enrollment in millions of person-year equivalents] 

2025 2026 2027 2028 2029 2025–2029 

Additional Medicaid Enrollees .................. 0.26 0.53 0.68 0.69 0.70 ........................

Additional QMBs ...................................... 0.15 0.16 0.16 0.16 0.16 ........................

Total Spending ......................................... 2,510 3,560 4,110 4,160 4,220 18,560 

Federal Spending ..................................... 1,440 2,050 2,360 2,390 2,430 10,670 

We received comments on our 

estimated impacts on Federal and State 

spending for this final rule, and our 

responses follow. 

Comment: Some commenters 

expressed concern with the projected 

increase in State spending estimated in 

the regulatory impact analysis. These 

commenters noted that the magnitude of 

additional State spending projected over 

the next five years would impose 

significant burden on State budgets 

including State reserve funds. 

Conversely, a few commenters that 

opposed provisions in the proposed rule 

cited the modest fiscal impact projected 

in the regulatory impact analysis as 

evidence of limited benefit and the 

rationale for their opposition. 

Response: We appreciate the 

commenters’ perspectives and 

acknowledge that this final rule may 

require programmatic updates and 

systems changes, and lead to increases 

in Medicaid and MSP enrollment, that 

could raise costs for States. To mitigate 

these concerns, and to allow more time 

to provide technical assistance to States, 

we are extending through this final rule 

the timeline for States to comply with 

many provisions. 

Comment: One commenter expressed 

concern that we did not appropriately 

factor social benefits and other 

distributional impacts attributable to 

increased enrollment in the Medicaid 

and MSPs into the regulatory impact 

analysis. This commenter noted that 

factoring social benefits, including 

reduced income- and race-based health 

disparities, in the regulatory impact 

analysis would strengthen the economic 

justification for the provisions in this 

rule. This commenter also highlighted 

that the provisions to streamline 

enrollment in Medicaid and the MSPs 

would result in a transfer of $61.9 

billion over 5 years to Medicaid and 

CHIP beneficiaries through additional 

healthcare spending by those programs. 

Response: We note that in section 

IV.F of this final rule we classify the 

impacts of this final rule as transfers, 

with the Federal Government and States 

incurring additional costs and 

beneficiaries receiving medical benefits 

and reductions in out-of-pocket health 

care costs (although the dollar value 

differs from the comment because we 

have updated our estimates and are only 

finalizing certain provisions of the 

proposed rulemaking in this final rule). 

Further, we acknowledge the potential 

benefit of factoring in social benefits 

into the regulatory impact analysis, but 

note that our current analysis does not 

include any potential economic effects 

associated with the impact of our 

provisions on social determinants of 

health. Lastly, we do believe the 

regulatory impact analysis accounts for 

distributional impacts in its discussion 

of transfers and total impacts. 

D. Alternatives Considered 

In developing this final rule, we 

considered the following alternatives: 

1. Not Finalizing the Rule 

We considered not finalizing this rule 

and maintaining the status quo. 

However, we believe this final rule will 

lead to more eligible individuals gaining 

access to coverage and maintaining their 

coverage across all States. 

2. Providing States With Discretion 

Regarding the Date of Application for 

QMBs 

Section 406.26 describes enrollment 

in Medicare Part A through the buy-in 

process. We considered proposing 

modifications to § 406.26(b) to provide 

States with discretion to use the Part A 

conditional enrollment filing date as the 

date of the Medicaid application for 

QMB eligibility. As background, the 

QMB eligibility group covers Part A 

premiums for individuals who do not 

qualify for premium-free Part A. 

However, to apply for the QMB 

eligibility group, an individual must be 

entitled to Part A and many cannot 

afford the monthly premium ($499 in 

2022). Such individuals have to 

navigate a complex two-step process 

where they first apply for conditional 

enrollment in Part A at SSA, then go to 

the State Medicaid agency to apply for 

the QMB eligibility group. Providing 

States the option to use the date of 

application at SSA for conditional 

enrollment as the date of application for 

a QMB application could permit States 

to offer an earlier effective date for 

QMB. We chose not to propose a 

regulatory change because we did not 

have enough information to accurately 

assess its impact. However, we sought 

comments on this alternative considered 

that might be adopted in this final rule 

based on comments received. In this 

final rule, we are not finalizing any such 

alternatives and instead, are finalizing 

what we proposed (albeit with a 

compliance date in 2026) for the reasons 

we cited in section II.A.1. of this final 

rule. 

E. Limitations of the Analysis 

There are a number of caveats to these 

estimates. Foremost, there is significant 

uncertainty about the actual effects of 

these provisions. Each of these 

provisions could be more or less 

effective than we have assumed in 

developing these estimates, and for 

many of these provisions we have made 

assumptions about the impacts they 

would have. In many cases, determining 

the reasons why a person may not be 

enrolled despite being eligible for 

Medicaid is difficult to do in an analysis 

such as this. Therefore, these 

assumptions rely heavily on our 

judgment about the impacts of these 

provisions. While we believe these are 

reasonable estimates, we note that this 

could have a substantially greater or 

lesser impact than we have projected. 

Second, there is uncertainty even 

under current policy in Medicaid. Due 

to the COVID–19 pandemic and 

legislation to address the pandemic, 

Medicaid has experienced significant 

increases in enrollment since the 

beginning of 2020. Actual underlying 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65269 

economic and public health conditions 

may differ than what we assume here. 

In addition to the sources of 

uncertainty described previously, there 

are other reasons the actual impacts of 

these provisions may differ from the 

estimates. There may be differences in 

the impacts of these provisions across 

eligibility groups or States that are not 

reflected in these estimates. There may 

also be different costs per enrollee than 

we have assumed here because those 

gaining coverage altogether or keeping 

coverage for longer durations of time 

may have different costs than those who 

were already assumed to be enrolled in 

the program. Lastly, to the extent that 

States have discretion in provisions that 

are optional in this final rule or in the 

administration of their programs more 

broadly, States’ efforts to implement 

these provisions may lead to larger or 

smaller impacts than estimated here. 

To address these limitations, we have 

developed a range of impacts for 

Medicaid spending. We believe that the 

actual impacts would likely fall within 

a range 50 percent higher or lower than 

the estimates we have developed. While 

this is a significant range, we would 

note that in the context of the entire 

Medicaid program ($743 billion in FY 

2021), this is still a relatively narrow 

range. 

F. Accounting Statement 

As required by OMB Circular A–4 

(available at https://

www.whitehouse.gov/wp-content/ 

uploads/legacy_drupal_files/omb/ 

circulars/A4/a-4.pdf), we have prepared 

an accounting statement in Table 14 

showing the classification of the transfer 

payments with the provisions of this 

final rule. These impacts are classified 

as transfers, with the Federal 

Government and States incurring 

additional costs and beneficiaries 

receiving medical benefits and 

reductions in out-of-pocket health care 

costs. 

This provides our best estimates of 

the transfer payments outlined in 

section IV.C. (Anticipated Effects) of 

this final rule. To address the significant 

uncertainty related to these estimates, 

we have assumed that the costs could be 

50 percent greater than or lesser than we 

have estimated here. We recognize that 

this is a relatively wide range, but we 

note several reasons for uncertainty 

regarding these estimates. First, there 

are numerous provisions that affect 

Medicaid in this rule. For several 

provisions, we have limited 

information, analysis, or comparisons to 

prior experience to use in developing 

our estimates. Thus, the range reflects 

that impacts of these provisions could 

be greater or lesser than we assume. We 

also note that there are expected 

impacts on Medicare; we believe this 

range adequately accounts for the 

potential variation in costs or savings to 

that program as well. Finally, given the 

significant effects of the COVID–19 

pandemic and legislation intended to 

address it, the current outlook for 

Medicaid is less certain than typical. We 

provide this wider range to account for 

this uncertainty as well. This range 

provides the high cost and low cost 

ranges shown in Table 14. 

TABLE 14—ACCOUNTING STATEMENT

[Expenditures in millions of 2025 dollars] 

Category Primary 

estimate 

Low 

estimate 

High 

estimate 

Units 

Year dollars Discount rate 

(%) 

Period 

covered 

Annualized Monetized Transfers from 

Federal Government to beneficiaries ... $3,579 $1,790 $5,369 2025 7 2025–2029 

3,622 1,811 5,433 2025 3 2025–2029 

Annualized Monetized Transfers from 

States to beneficiaries .......................... 1,555 777 2,332 2025 7 2025–2029 

1,568 784 2,352 2025 3 2025–2029 

This final regulation is subject to the 

Congressional Review Act provisions of 

the Small Business Regulatory 

Enforcement Fairness Act of 1996 (5 

U.S.C. 801 et seq.) and has been 

transmitted to the Congress and the 

Comptroller General for review. 

Chiquita Brooks-LaSure, 

Administrator of the Centers for 

Medicare & Medicaid Services, 

approved this document on September 

15, 2023. 

List of Subjects 

42 CFR Part 406 

Diseases, Health facilities, Medicare. 

42 CFR Part 435 

Aid to Families with Dependent 

Children, Grant programs—health, 

Medicaid, Reporting and recordkeeping 

requirements, Supplemental Security 

Income (SSI), Wages. 

For the reasons set forth in the 

preamble, the Centers for Medicare & 

Medicaid Services amends 42 CFR 

chapter IV as set forth below: 

PART 406—HOSPITAL INSURANCE 

ELIGIBILITY AND ENTITLEMENT 

■ 1. The authority citation for part 406 

continues to read as follows: 

Authority: 42 U.S.C. 1302, 1395i–2, 

1395i–2a, 1395p, 1395q and 1395hh. 

■ 2. Section 406.21 is amended by 

adding paragraph (c)(5) to read as 

follows: 

§ 406.21 Individual enrollment. 

* * * * * 

(c) * * * 

(5) If an individual resides in a State 

that pays premium hospital insurance 

for Qualified Medicare Beneficiaries 

under § 406.32(g) and enrolls or 

reenrolls during a general enrollment 

period after January 1, 2023, QMB 

coverage is effective the month 

entitlement begins (if the individual is 

determined eligible for QMB before the 

month following the month of 

enrollment), or a month later than the 

month entitlement begins (if the 

individual is determined eligible for 

QMB the month entitlement begins or 

later). 

* * * * * 

PART 435—ELIGIBILITY IN THE 

STATES, DISTRICT OF COLUMBIA, 

THE NORTHERN MARIANA ISLANDS, 

AND AMERICAN SAMOA 

■ 3. The authority citation for part 435 

continues to read as follows: 

Authority: 42 U.S.C. 1302. 

■ 4. Section 435.4 is amended by adding 

a definition for ‘‘Low Income Subsidy 

Application data (LIS leads data)’’ in 

alphabetical order to read as follows: 


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65270 Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 

§ 435.4 Definitions and use of terms. 

* * * * * 

Low-Income Subsidy Application data 

(LIS leads data) means data from an 

individual’s application for low-income 

subsidies under section 1860D–14 of the 

Act that the Social Security 

Administration electronically transmits 

to the appropriate State Medicaid 

agency as described in section 

1144(c)(1) of the Act. 

* * * * * 

■ 5. Section 435.601 is amended by 

adding paragraph (e) to read as follows: 

§ 435.601 Application of financial eligibility 

methodologies. 

* * * * * 

(e) Procedures for determining 

eligibility for the Medicare Savings 

Program groups. When a State 

determines eligibility for a Medicare 

Savings Program group, for income 

eligibility the agency must include at 

least the individuals described in 

§ 423.772 of this chapter in determining 

family of the size involved. 

* * * * * 

■ 6. Revise § 435.909 to read as follows: 

§ 435.909 Automatic entitlement to 

Medicaid following a determination of 

eligibility under other programs. 

(a) Automatic enrollment of certain 

individuals in Medicaid. The agency 

must not require a separate application 

for Medicaid from an individual, if the 

agency has an agreement with the Social 

Security Administration (SSA) under 

section 1634 of the Act for determining 

Medicaid eligibility; and— 

(1) The individual receives SSI; 

(2) The individual receives a 

mandatory State supplement under 

either a federally-administered or Stateadministered program; or 

(3) The individual receives an 

optional State supplement and the 

agency provides Medicaid to 

beneficiaries of optional supplements 

under § 435.230. 

(b) Automatic enrollment of SSI 

recipients in the Qualified Medicare 

Beneficiary group. (1) The agency must 

deem individuals eligible for the 

Qualified Medicare Beneficiary group as 

described in § 400.200 of this chapter if 

the individual receives SSI and is 

determined eligible for medical 

assistance under § 435.120 or § 435.121; 

and— 

(i) The individual is entitled to Part A 

under part 406, subpart B, of this 

chapter; or 

(ii) The individual is entitled to Part 

A under § 406.20 of this chapter and the 

agency has a State buy-in agreement 

authorized under section 1843 of the 

Act and modified under section 1818(g) 

of the Act. 

(2) The agency may deem individuals 

eligible for the Qualified Medicare 

Beneficiary group as described in 

§ 400.200 of this chapter if the 

individual receives SSI and is 

determined eligible for medical 

assistance under §§ 435.120 or 435.121; 

and— 

(i) The individual is entitled to Part A 

under § 406.5(b) of this chapter; and 

(ii) The agency uses the group payer 

arrangement under § 406.32(g) of this 

chapter to pay Part A premiums for 

Qualified Medicare Beneficiaries. 

(3) The automatic enrollment of SSI 

recipients in the Qualified Medicare 

Beneficiaries group described in 

paragraphs (b)(1) and (2) of this section 

is effective no earlier than the effective 

date of coverage under a buy-in 

agreement for individuals described in 

§ 407.47(b) of this chapter. 

■ 7. Section 435.911 is amended by 

adding paragraph (e) to read as follows: 

§ 435.911 Determination of eligibility. 

* * * * * 

(e) For each individual who has 

applied for the Part D Low Income 

Subsidy through the Social Security 

Administration (SSA) and granted 

permission for the Social Security 

Administration to share Low Income 

Subsidy application data (LIS leads 

data) with the Medicaid agency for the 

purpose of submitting an application for 

the Medicare Savings Programs, the 

agency must— 

(1) Accept, via secure electronic 

interface, LIS leads data transmitted to 

the agency from SSA; 

(2) Treat received LIS leads data 

relating to an individual as an 

application for eligibility under the 

Medicare Savings Programs, without 

requiring submission of another 

application; 

(3) Accept LIS leads data, without 

further verification, unless– 

(i) The agency has information that is 

not reasonably compatible with the 

leads data; or 

(ii) The information provided through 

the LIS leads data does not support a 

determination of eligibility for the 

Medicare Savings Programs; 

(4) Not request information or 

documentation from the individual 

already provided to SSA through the 

LIS application and included in the 

transmission to the agency by SSA 

unless the agency has information that 

is not reasonably compatible with the 

LIS leads data; 

(5) Seek additional information that is 

not in the LIS leads data if needed by 

the agency to make a determination of 

eligibility for the Medicare Savings 

Programs; 

(6) Verify an individual’s U.S. 

citizenship or satisfactory immigration 

status in accordance with §§ 435.406 

and 435.956; 

(7) Determine the eligibility of the 

individual for the Medicare Savings 

Programs promptly and without undue 

delay, consistent with timeliness 

standards established under § 435.912; 

and 

(8) If any of the LIS leads data does 

not support a determination of 

eligibility under the Medicare Savings 

Programs— 

(i) Determine what additional 

information is needed to make a 

determination of eligibility for the 

Medicare Savings Programs; 

(ii) Notify the individual that they 

may be eligible for assistance with their 

Medicare premium and/or cost sharing 

charges, but that additional information 

is needed for the agency to make a 

determination of such eligibility; 

(iii) Provide the individual with a 

minimum of 30 days to furnish any 

information needed by the agency to 

make such determination of eligibility; 

and 

(iv) Verify the individual’s eligibility 

for the Medicare Savings Programs in 

accordance with the agency’s 

verification plan developed in 

accordance with § 435.945(j). 

(9) Provide the individual with, in 

addition to and separate from any 

requests for additional information 

necessary for a determination of 

Medicare Savings Program eligibility, 

unless CMS approves otherwise,— 

(i) Information about the availability 

of additional Medicaid benefits on other 

bases, including the scope of such 

benefits and responsibilities of the 

individual applying for such benefits; 

and 

(ii) An opportunity to furnish such 

additional information as may be 

needed to determine whether the 

individual is eligible for such additional 

Medicaid benefits on other bases. 

■ 8. Section 435.952 is amended by 

adding paragraph (e) to read as follows: 

§ 435.952 Use of information and requests 

for additional information from individuals 

* * * * * 

(e) When determining eligibility for 

individuals applying for the Medicare 

Savings Programs specified in sections 

1902(a)(10)(E)(i), (iii) and (iv) and 

1905(p) of the Act, the agency must 

accept attestation (either self-attestation 

by the individual or attestation by an 

adult who is in the applicant’s 

household, as defined in § 435.603(f), or 

family, as defined in section 36B(d)(1) 


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Federal Register / Vol. 88, No. 182 / Thursday, September 21, 2023 / Rules and Regulations 65271 

of the Internal Revenue Code, an 

authorized representative, or, if the 

individual is a minor or incapacitated, 

someone acting responsibly for the 

individual) of the following income and 

asset information without requiring 

further information (including 

documentation) from the individual: 

(1) Income and interest income. (i) 

Except as provided in paragraph 

(e)(1)(ii) of this section, the agency must 

accept an applicant’s attestation of the 

value of any dividend and interest 

income earned on resources owned by 

the applicant or the applicant’s spouse. 

(ii) If the agency has information that 

is not reasonably compatible with an 

applicant’s attestation, the agency must 

seek additional information from the 

individual in accordance with 

paragraph (c) of this section. 

(iii) The agency may verify interest 

and dividend income after the agency 

has determined that an applicant is 

eligible for the Medicare Savings 

Programs, in accordance with paragraph 

(c) of this section. If the agency requests 

documentation in accordance with this 

paragraph, the agency must provide the 

individual with at least 90 days from the 

date of the request to provide any 

necessary information requested and 

must allow the individual to submit 

such documentation through any of the 

modalities described in § 435.907(a). 

(2) Non-liquid resources. (i) Except as 

provided in paragraph (e)(2)(ii) of this 

section, the agency must accept an 

applicant’s attestation of the value of 

any non-liquid resources owned. 

(ii) If the agency has information that 

is not reasonably compatible with an 

applicant’s attestation, the agency must 

seek additional information from the 

individual in accordance with 

paragraph (c) of this section. 

(iii) The agency may verify the value 

of non-liquid resources after the agency 

has determined that an applicant is 

eligible for the Medicare Savings 

Programs, in accordance with paragraph 

(c) of this section. If the agency requests 

documentation in accordance with this 

paragraph, the agency must provide the 

individual with at least 90 days from the 

date of the request to provide any 

necessary information requested and 

must allow the individual to submit 

such documentation through any of the 

modalities described in § 435.907(a). 

(3) Burial funds. (i) Except as 

provided in paragraph (e)(3)(ii) of this 

section, the agency must accept an 

applicant’s attestation that up to $1,500 

of their resources, and up to $1,500 of 

their spouse’s resources, are set aside in 

a separate account and are not countable 

as resources when determining 

eligibility for the Medicare Savings 

Programs. 

(ii) If the agency has information that 

is not reasonably compatible with an 

applicant’s attestation, the agency must 

seek additional information from the 

individual in accordance with 

paragraph (c) of this section. 

(iii) The agency may verify resources 

in burial funds after the agency has 

determined that an applicant is eligible 

for the Medicare Savings Programs, in 

accordance with paragraph (c) of this 

section. If the agency requests 

documentation in accordance with this 

paragraph, the agency must provide the 

individual with at least 90 days from the 

date of the request to provide any 

necessary information requested and 

must allow the individual to submit 

such documentation through any of the 

modalities described in § 435.907(a). 

(4) Life insurance policies. (i) Except 

as provided in paragraph (e)(4)(ii) of this 

section, the agency must accept an 

applicant’s attestation of the face value 

of life insurance. 

(A) If an individual attests to a face 

value of life insurance policy that is 

above $1,500, the State may accept an 

attestation of the cash surrender value of 

the life insurance policy for the purpose 

of determining resource eligibility for 

the Medicare Savings Programs. 

(B) [Reserved] 

(ii) If the agency has information 

about either the face value or the cash 

surrender value that is not reasonably 

compatible with an applicant’s 

attestation, the agency must seek 

additional information from the 

individual in accordance with 

paragraph (c) of this section, which may 

include a reasonable explanation of the 

discrepancy or documentation. 

(iii) The agency may verify the face 

value of a life insurance policy after the 

agency has determined that an applicant 

is eligible for a Medicare Savings 

Program, in accordance with paragraph 

(c) of this section. 

(iv)(A) When an individual must 

provide documentation of the cash 

surrender value of a life insurance 

policy, the agency must assist the 

individual with obtaining this 

information and documentation by 

requesting that the individual provide 

the name of the insurance company and 

policy number and authorize the agency 

to obtain such documentation from the 

issuer of the policy on the individual’s 

behalf. The agency may also request, but 

may not require, additional information 

from the applicant to assist the agency 

in obtaining the needed documentation, 

such as the name of an agent. 

(B) If the individual does not provide 

the information and authorization in 

paragraph (e)(4)(iv)(A) of this section, 

the agency may require that the 

individual provide documentation of 

the cash surrender value. 

(C) The agency must allow the 

individual to submit documentation 

through any of the modalities described 

in § 435.907(a) and provide the 

individual with at least 15 days to 

provide information or documentation 

described in this paragraph if such 

information or documentation is 

requested pursuant to paragraph (e)(4)(i) 

or (ii) of this section and at least 90 days 

if required pursuant to paragraph 

(e)(4)(iii) of this section. 

Xavier Becerra, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2023–20382 Filed 9–18–23; 4:15 pm] 

BILLING CODE 4120–01–P 


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