Source: http://govpulse.us/entries/2011/04/19/2011-9340/medicaid-program-federal-funding-for-medicaid-eligibility-determination-and-enrollment-activities
Timestamp: 2015-05-27 19:54:06
Document Index: 538771787

Matched Legal Cases: ['art 433', 'art 433', 'art 95', 'art 95', '§ 432', '§ 432', '§ 432', '§ 433']

govpulse | Medicaid Program; Federal Funding for Medicaid Eligibility Determination and Enrollment Activities
Medicaid Program; Federal Funding for Medicaid Eligibility Determination and Enrollment Activities
This final rule will revise Medicaid regulations for Mechanized Claims Processing and Information Retrieval Systems. We are also modifying our regulations so that the enhanced Federal financial participation (FFP) is available for design, development and installation or enhancement of eligibility determination systems until December 31, 2015. This final rule also imposes certain defined standards and conditions in terms of timeliness, accuracy, efficiency, and integrity for mechanized claims processing and information retrieval systems in order to receive enhanced FFP.
A. The Current State of the Medicaid Management Information System (MMIS)
B. Availability of Enhanced FFP for Automated Eligibility Systems
C. Changes in Medicaid Eligibility Policies
A. Requests for Enhanced Federal Funding
B. Requests for Additional Guidance
C. Public Feedback and Suggestions Related to the Seven Standard and Conditions
D. Public Feedback and Suggestions Related to the APD Process
E. Issues Related to the Transition Period for Compliance
F. Comments Regarding CMS' Strategy for Monitoring and Oversight, Including Performance Reviews
G. Issues Related to Partial Systems Improvements or Modernizations
H. Specific Issues by Regulatory Provision
I. Issues Related to the Regulatory Impact Analysis, Including the Cost Estimates, and Information Collection
A. Medicaid Eligibility Determinations
B. Standards and Conditions for Receiving Enhanced Funding
C. Reviews and Performance Monitoring of MMISs
D. Partial Systems Improvements or Modernizations
E. Changes to Federal Regulations at 42 CFR Part 433 Subpart C—Mechanized Claims Processing and Information Retrieval Systems
V. Waiver of Delay in Effective Date
C. Potential Savings
D. Calculation of MMIS Costs
E. Calculation of Eligibility Systems Costs
F. Total Net Cost Impact
H. Alternatives Considered
I. Accounting Statement
Estimated Annual Reporting Burden Reporting
Table 1—Net Federal Cost Impact of Regulation
Table 1.1—Net Federal Cost Impact of Regulation by Fiscal Year
Table 2—Net State Cost Impact of Regulation
Table 2.1—Net State Cost Impact of Regulation by Fiscal Year
Table 3—Accounting Statement: Classification of Estimated Net Costs, From FY 2011 to FY 2020
Effective Date: These regulations are effective on April 19, 2011.
Richard Friedman, (410) 786-4451.
A. The Current State of the Medicaid Management Information System (MMIS) ↑
A Medicaid management information system (MMIS) is a mechanized system of claims processing and information retrieval used in State Medicaid programs under title XIX of the Social Security Act (the Act). The system is used to process Medicaid claims from providers and to retrieve and produce utilization data and management information about medical care and services furnished to Medicaid recipients. The system also is potentially eligible to receive enhanced administrative funding from the Federal government under section 1903(a)(3) of the Act. Specifically, section 1903(a)(3)(A)(i) of the Act provides that Federal financial participation (FFP) is available at 90 percent of expenditures for the design, development, or installation of mechanized claims processing and information retrieval systems as the “Secretary determines are likely to provide more efficient, economical and effective administration of the plan and to be compatible with the claims processing and information retrieval systems utilized in the administration of title XVIII [Medicare].” In addition, section 1903(a)(3)(B) of the Act provides for the availability of FFP at 75 percent of expenditures attributable to operating the “systems * * * of the type described in [section 1903(a)(3)] subparagraph (A)(i),” which are approved by the Secretary and meet certain other requirements (including requirements relating to explanations of benefits). For purposes of this final rule, we refer to 90 percent and 75 percent FFP as “enhanced” FFP since it is greater than the 50 percent FFP available for most Medicaid administrative expenses. In addition, section 1903(r) of the Act places conditions on a State's ability to receive Federal funding for automated data systems in the administration of the State plan.
To receive an enhanced match, the Secretary must find that the mechanized claims and information retrieval system is adequate to provide more efficient, economical, and effective administration of the State plan. The Patient Protection and Affordable Care Act of 2010 (Pub. L. 111-148, enacted on March 23, 2010), as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152, enacted on March 30, 2010) (collectively referred to as the Affordable Care Act) also made additional changes to the requirements within section 1903(r) of the Act relating to the reporting of data to the Secretary; guidance on these requirements will be issued in a separate rulemaking document. Our Federal regulations concerning mechanized claims processing and information retrieval systems are at 42 CFR part 433, subpart C. A State that chooses to develop, enhance, or replace its required system or subsystems must first submit for approval an Advanced Planning Document (APD). The general Health and Human Services (HHS) requirements for approval of APDs are found at 45 CFR part 95, subpart F.
B. Availability of Enhanced FFP for Automated Eligibility Systems ↑
Historically, Medicaid eligibility for many applicants and recipients was determined by an agency other than the State Medicaid agency. Under section 1902(a)(10)(A)(i) of the Act, States were required to provide Medicaid to recipients under the Aid to Families with Dependent Children (AFDC) program, as well as recipients of the Supplemental Security Income (SSI) program. In these cases, eligibility determinations were derived from the cash welfare-assistance determination. As a result, States that maintained a Medicaid eligibility determination system usually integrated these systems into the public welfare systems. In the October 13, 1989Federal Register(54 FR 41966, effective November 13, 1989), we published a final rule excluding eligibility determination systems from the enhanced funding that was available under section 1903(a)(3) of the Act, reasoning that the close interrelationship between these cash assistance programs and Medicaid eligibility rendered such enhanced assistance redundant and unnecessary (54 FR 41966 through 41974). As a result, we revised the definition of mechanized claims processing and information retrieval systems to exclude eligibility determination systems.
We also indicated in the 1989 final rule that to receive any FFP for Medicaid purposes for an eligibility determination system after November 13, 1989, a State must submit an APD for funding in accordance with the requirements of 45 CFR Part 95, Subpart F. If we approved the APD, the State agency would receive 50 percent FFP for administrative costs under section 1903(a)(7) of the Act for the system's design, development, and installation, and operation.
C. Changes in Medicaid Eligibility Policies ↑
Since we issued the October 13, 1989 final rule, a series of statutory changes have dramatically affected eligibility for Medicaid and how Medicaid eligibility is determined. Among other things, new eligibility coverage groups were created and expanded, and in 1996, Medicaid eligibility was “de-linked” from the receipt of cash assistance when the AFDC program was replaced by the Temporary Assistance to Needy Families (Pub. L. 104-193, enacted on August 22, 1996) (TANF) program created by the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) (Pub. L. 104-193, enacted on August 22, 1996).
With the passage of the Balanced Budget Act of 1997 (Pub. L. 105-33, enacted on August 5, 1997) (BBA), States were required to coordinate eligibility for and enrollment in Medicaid with the new Children's Health Insurance Program (CHIP) to ensure enrollment of children in the appropriate program. With passage of the “Express Lane Eligibility” provisions in section 203 of the Children's HealthInsurance Program Reauthorization Act of 2009 (Pub. L. 111-3) (CHIPRA), States were provided with the option, and are encouraged, to coordinate and expedite eligibility for children in Medicaid and CHIP by using findings regarding income and other eligibility criteria made by other agencies, such as the Supplemental Nutrition Assistance Program (SNAP), as the basis for Medicaid and CHIP eligibility adjudications.
With the passage of the Affordable Care Act, we expect that changes to Medicaid eligibility policies and business processes need to be adopted. States will need to apply new rules to adjudicate eligibility for the program; enroll millions of newly eligible individuals through multiple channels; renew eligibility for existing enrollees; operate seamlessly with newly authorized Health Insurance Exchanges (see section 1311 of the Affordable Care Act) whether run by the State or the U.S. Department of Health and Human Services (HHS) if the State chooses not to operate a State Exchange (hereafter referred to as “Exchanges”); participate in a system to verify information from applicants electronically; incorporate a streamlined application used to apply for multiple sources of coverage and health insurance assistance; and produce notices and communications to applicants and beneficiaries concerning the process, outcomes, and their rights to dispute or appeal. We further anticipate, following consultation with States and other stakeholders, additional standard Federal requirements for more timely and detailed reporting of eligibility and enrollment status statistics, including breakdowns by eligibility group, demographic characteristics, enrollment in managed care plans, and participation in waiver programs.
System transformations will be needed in most States to accomplish these changes. These systems transformations should be undertaken in full partnership with Exchanges in order to meet coverage goals, minimize duplication, ensure effective reuse of infrastructure and applications, produce seamless enrollment for consumers, and ensure accuracy of program placements (see sections 1413 and 2201 of the Affordable Care Act). Extensive coordination and collaboration will be required between Exchanges and Medicaid, including on oversight and evaluation of the interoperability of the Exchange and Medicaid systems. In addition, States may consider how to coordinate systems changes with the eligibility determination systems used for other health and human services programs, such as SNAP, because a large share of individuals who are eligible for Medicaid also are eligible for other programs as well.
II. Provisions of the Proposed Regulations ↑
In the November 8, 2010Federal Register(75 FR 68583), we published a proposed rule that revised the Medicaid regulations for Mechanized Claims Processing and Information Retrieval Systems. Specifically, we proposed to amend the definition of Mechanized Claims Processing and Information Retrieval Systems to include mechanized eligibility determination systems, which would include the enrollment and eligibility reporting activities associated with such systems. We also proposed that the enhanced FFP would be available for design, development and installation or enhancement of eligibility determination systems until December 31, 2015.
III. Analysis of and Responses to Public Comments ↑
We received 40 timely comments on the November 8, 2010 proposed rule (75 FR 68583 through 68595).
Commenters expressed general support for the policies outlined in the proposed rule. Specifically, commenters agreed that providing enhanced matching funds for Medicaid eligibility systems is appropriate and necessary. Commenters expressed almost universal agreement that this enhanced match is critical to support State efforts to modernize their eligibility systems, and will allow States to bring these systems into the 21st Century so that they can provide cost-effective, accurate, reliable, and beneficiary-friendly assessments of eligibility for the Medicaid program. In light of the substantial changes made by the Affordable Care Act, commenters agreed that it is more important than ever to ensure that eligibility determination systems are designed and operated using the most up-to-date technological and business process solutions. With States expected to enroll millions of newly eligible individuals into Medicaid and to ensure seamless coordination with the new Exchanges, it is essential that States have modern and cost-effective eligibility systems that will accurately enroll eligible individuals, without unnecessarily cumbersome processes or delays. Commenters also believed that such initial investments would ultimately lower ongoing maintenance and operational expenses, driving savings for both States and the Federal government.
Commenters also noted that HHS had released additional documents at approximately the same time as the November 8, 2010 proposed rule, which reinforced our strategic direction and received their support. Specifically, commenters acknowledged the joint guidance released by CMS and the Office of Consumer Information and Insurance Oversight (now CMS' Center for Consumer Information and Insurance Oversight (CCIIO)) entitled, “Exchange/Medicaid Information Technology Guidance, version 1.0,” and the Funding Opportunity Announcement for Cooperative Agreements to Support Early Innovator Grants for Exchanges. Commenters indicated that they greatly appreciated the foresight of CMS and CCIIO, and are supportive of the guidance providing direction towards a service-oriented IT infrastructure based on interoperable systems and that they fully support the concept of a collaborative IT development approach among States, CMS and CCIIO.
A summary of additional major issues and our responses follow. Since many of the comments were general in nature and not specific to any particular regulatory provision, we have identified the comments by nine categories:
• Requests for enhanced Federal funding.
• Requests for additional guidance.
• Public feedback and suggestions related to the seven standards and conditions.
• Public feedback and suggestions related to the APD process.
• Issues related to the transition period for compliance.
• Comments regarding CMS' strategy for monitoring and oversight, including performance reviews.
• Issues related to partial systems improvements or modernizations.
• Specific issues by regulatory provision.
• Issues related to the Regulatory Impact Analysis including the cost estimates, and information collection.
A. Requests for Enhanced Federal Funding ↑
Comment: Numerous commenters requested that the enhanced FFP for design, development, and installation or enhancement of eligibility determination systems be extended beyond the December 31, 2015 deadline. Commenters indicated that new and significant enhancements may be needed beyond December 31, 2015, particularly in order to affect future legislative changes to Medicaid eligibility or to keep pace with technological innovations. Thecommenters noted that State budgets continue to be in a state of crisis and State revenues may not fully recover until 2016 or later; consequently, the Federal government must take responsibility for ensuring adequate funding of the program infrastructure to ensure compliance by January 1, 2014. Commenters recommended several different options in this regard. Some commenters indicated that CMS should consider that the requirement apply to funds allocated rather than expended. Other commenters believed that CMS could allow for the possibility of a continued enhanced match beyond the deadline in specified circumstances (many outside the control of State governments), such as new Federal requirements or major advances in computer technology. Other exception categories suggested by commenters included unforeseen issues in implementation and/or new opportunities for interoperability with other health and human services programs. Other commenters indicated that CMS should extend funding if States have approved APDs on or before December 31, 2015 and the project has not been completed or if States are planning to leverage improvements from other State Medicaid eligibility systems. The commenters further indicate that they are concerned that they will be unable to receive legislative approval to begin their project, develop an APD, receive Federal approval, and then complete work on the project while meeting the standards and conditions before the enhanced FFP ends on December 31, 2015. Still other commenters believed the date should be changed to coincide with the end of the Federal fiscal year 2015 and 2016, so that enhanced funding would expire September 30, 2016. One commenter suggests that the deadline should be interpreted to apply to costs for projects receiving enhanced funding and obligated by that date rather than expended by December 31, 2015. One commenter expressed concern that a requirement for States to maintain existing eligibility processes for pregnant women and children until September 30, 2019 will mean States have to maintain dual eligibility systems during this time period. At the end of 2019, the IT systems will need to be updated to remove this function and that enhanced funding should be extended for States to make changes to eligibility systems when this requirement ends.
Response: We appreciate the significant number of comments we received on this aspect of our proposed rule and the view of commenters that we should eliminate, extend, or modify the deadline for expiration of the enhanced match for eligibility systems. Nonetheless, while we appreciate the opinions of commenters, we continue to believe that the deadline we established in the proposed rule is appropriate and proper. We believe it is within our authority to determine that by a certain date, additional investments in eligibility determination systems will no longer continue to result in “more” efficient, effective or economical administration of the State Plan, as required by section 1903(a)(3)(A)(i) of the Act. Further, we continue to believe that December 31, 2015 is a reasonable and proper end-point for when investments cease to result in acceptable increases in efficiency, economy, or effectiveness. Our reason is threefold: First, changes imposed by the Affordable Care Act will require immediate attention and commitment to new technologies for eligibility and enrollment systems. Second, once appropriate systems are deployed to support the coverage expansions and other eligibility changes required by the Affordable Care Act, we anticipate significant efficiencies in both application maintenance and business operations. Third, the additional 2 years we provided to States after the Medicaid expansion goes into effect allows ample time for States to refine and enhance the capability of the systems, and to capitalize on the efficiencies of these investments.
We articulated in the proposed rule that additional investments are unlikely to yield similar rates of improvement and a regular administrative match should be sufficient for efficient and effective administration of State Medicaid programs. We anticipate that the improved underlying infrastructure supporting both Medicaid and Exchanges will be strongly leveraged in support of a State's person-centric outreach, eligibility and enrollment activities across the health and human services spectrum.
With respect to the request made by some commenters to establish an exceptions process, we believe this is already sufficiently provided for through our extension of enhanced FFP for an additional 2 years beyond the date for operation of the Exchanges. We are concerned that broadening or codifying exceptions to the deadline in the way suggested by the commenters would effectively render the deadline moot for many purposes and projects.
The September 30, 2019 date noted by one commenter is the end-date for maintenance of effort (MOE) provisions for children (not pregnant women). Because of these MOE provisions, States must not have more restrictive “eligibility standards, methodologies, or procedures” for children than those in effect on March 23, 2010. The MOE requirement does not mean that States must maintain identical standards, methodologies or procedures as those in effect on March 23, 2010, and it does not mean that the same IT system or IT system processes be used. Rather, the MOE requires that the eligibility standards, methods, and procedures be no more restrictive than those in effect on March 23, 2010.
We are not certain of what the commenter is concerned about in terms of States' needing to maintain dual eligibility processes, but we assume he or she may be concerned about the interaction of the MOE requirements and the requirement under section 2002 of the Affordable Care Act. The conversion to a MAGI-equivalent income standard required under section 2002 of the Affordable Care Act is designed in the statute to ensure that individuals who meet the eligibility requirements in effect as of March 23, 2010 do not lose eligibility as a result of the shift to MAGI. Guidance will be provided by the Secretary regarding how States can accomplish the required conversion, and once the new MAGI-equivalent income standard has been determined, the MOE requirements will be applied to such converted standard, using the MAGI methodologies to determine an individual's income, as required under the Affordable Care Act. Therefore, the MOE requirements will not require operating dual eligibility systems.
After consideration of the public comments received, we are maintaining the December 31, 2015 deadline in our regulations for eligibility determination systems.
Comment: One commenter requested that CMS consider interpreting the deadline of December 31, 2015 for projects receiving enhanced Federal funding to requiring the funds be obligated by that date rather than expended.
Response: We indicated in the proposed rule (75 FR 68589) that States would need to incur costs for goods and services furnished no later than December 31, 2015 to receive 90 percent FFP for design, development, installation, or enhancement of an eligibility system. For further clarification, this means that States must ensure that goods and services (for example, eligibility and enrollment modules, applications, systems, etc.) are provided to States no later than close ofbusiness December 31, 2015. Thus, for example, if an amount has been obligated by December 31, 2015, but the good or service has not yet been furnished by that date, then such expenditure would not be eligible for enhanced FFP.
As a result of this comment, we are adding language to the regulations text to clarify this point.
Comment: Numerous commenters asked whether enhanced funding is available for subsystems that interface with and/or are part of the eligibility process since such subsystems will require modifications to meet the requirements of the Affordable Care Act. Additionally, commenters sought enhanced FFP for projects that meet Medicaid Information Technology Architecture (MITA) guidance, yet still may need to integrate with legacy systems, with the understanding that, where feasible, open rules and specifications developed for programs will be used to read, insert, or update data into systems that currently do not have the functionality of being interoperable. The commenters agreed that APDs would need to be put in place and approved to modernize the legacy systems/subsystems.
Response: We agree that enhanced funding can be available for subsystems that meet the standards and conditions outlined in this final rule. However, to the extent that such subsystems are reliant on or tied to a larger legacy system or suite of systems that introduce performance risk or ongoing costs to the operation of the subsystem, we may find that the system as a whole is not meeting the standards and conditions of this final rule and decline to approve enhanced match on that basis. It is our desire to acknowledge that subsystem modernization may be an entirely appropriate pathway to a high performing Medicaid program, while at the same time not binding ourselves to approve enhanced match for minor components of a large, fragmented legacy system that has little chance of delivering to expected business results. CMS will review APDs and make determinations regarding such subsystems, and to the extent that such subsystems meet with the standards and conditions outlined in this final rule and States can document that there is no performance risk or ongoing unnecessary costs, as a result of the subsystem being a part of larger legacy system, CMS will make determinations regarding enhanced funding accordingly.
Comment: Several commenters want to ensure that enhanced FFP is available to States that are not completely MITA compliant, but rather to States that can demonstrate efficiencies are being achieved, redundancy is being decreased/eliminated, and system integration is being realized through application programming interfaces (API). States could demonstrate that APIs, in which a particular set of rules and specifications for services and resources have been developed by one software program that can be accessed and used by another software program implementing the API, can be used and serve as an interface between different software programs and facilitating their interaction, and thus, leading to efficiencies. Commenters added that with an approved APD reasonable and measureable milestones of system compliance can be demonstrated.
Response: Enhanced FFP is available for those systems that comply with the standards and conditions of this final rule. Aligning to, and advancing increasingly, in MITA maturity for business, architecture, and data is one of the standards and conditions that must be met. We did not use the term “MITA compliant” in our proposed rule because MITA maturity is by definition, a matter of degree. We agree that achieving increasing levels and degrees of MITA maturity is likely to happen in stages. Recognizing this, we will be requiring a MITA roadmap that delineates how the proposed system enhancements for eligibility and enrollment functions will fit into the States' greater MITA framework. Such requirement will align with our expectations to see States continuing to make measurable progress in implementing their MITA roadmaps. We believe it is critical to build on and accelerate the modernization we have collectively begun under MITA, so that States achieve the final vision of MITA and have a comprehensive framework with which to meet the technical and business demands required by an environment that will increasingly rely on health information technology and the electronic exchange of healthcare information to improve health outcomes and lower program costs.
Comment: One commenter requested clarification as to whether enhanced FFP will be available where a project has some components that meet the standards and guidelines required for enhanced FFP, but may include other components that do not.
Response: We believe it is entirely appropriate to accomplish system modernization through phasing. In cases such as the one raised by the commenter, the changes being made to various system components will need to be reviewed through submission of an APD and review. We will need to ensure that component-based development is on a path toward an entire system or subsystem coming into compliance with the standards and conditions of this final rule. We would expect that if the components that do not meet the standards and conditions are essentially preventing the entire system or subsystem from meeting the standards and conditions, then the State would have a plan for updating such components, even if all components are not updated at the same time. For example, we do not expect that we would offer enhanced FFP for improvements to just the reporting aspect of the traditional, legacy eligibility system, if the State does not have a plan for bringing this entire legacy system into compliance with the standards and conditions. In addition, to receive enhanced FFP, States may not ignore any single standard or condition regardless of the level or breadth of their compliance with the remaining standards, although if a State is weaker or more at risk with certain standards or conditions, the State should include a roadmap in their APD demonstrating how they intend to come into compliance. We intend to carefully track progress against approved roadmaps when determining if system updates continue to meet the standards and conditions for enhanced match.
Comment: One commenter suggests that CMS clarify that enhanced funding is also available for “traditional” eligibility determinations, such as those made on behalf of medically needy clients, buy-in, elderly, disabled, long-term care and home and community-based individuals.
Response: To the extent that eligibility systems meet all requirements, standards, and conditions contained in this final rule, States will be eligible for enhanced FFP, and such enhanced funding is not dependent upon the eligibility group using the system.
Comment: One commenter recommended that CMS clarify that enhanced funding is available for personnel costs, as well as the costs of physical systems. Specifically, the commenter notes that Federal regulations at § 432.50(b) provide for enhanced funding at 75 percent for the costs of staff “engaged directly in the operation of mechanized claims processing and information retrieval systems” and for enhanced funding at 90 percent for staff costs related to the design, development, and installation of these systems. FFP is provided at 50 percent for the costs of training personnel when new systems are developed.
Response: We did not propose amendments to the regulations at § 432.50(b); thus, enhanced funding is available for staff time spent on mechanized eligibility determination systems in the same manner that they apply to all mechanized claims processing and information retrieval systems, since mechanized eligibility determination systems are now considered to be part of such systems, assuming the requirements of this section are met.
Comment: One commenter asked that we extend the enhanced funding to encompass the testing of the effectiveness of the eligibility systems, including testing beneficiary experience such as allowing States to receive reimbursement for conducting focus groups with community-based workers and/or beneficiaries who rely on the system to apply for and renew Medicaid coverage.
Response: Again, to the extent these costs would be reimbursable under § 432.50(b), they would be eligible for reimbursement under this rule as well (assuming all standards and conditions are met). States would need to ensure that the expenditures are tied to the mechanized eligibility determination system and follow all procedures for seeking approval.
Comment: Several commenters requested that CMS require States to pass enhanced match through to counties. The commenters stated that CMS should ensure that if a State requires counties to contribute to the non-Federal share of Medicaid and Medicaid administrative costs, and that receives enhanced FFP; the State should be required to share the enhanced FFP in proportion to the counties' contribution. The commenters stated that this requirement would reflect the clear Congressional intent as expressed in the enhanced Federal Medical Assistance Percentage (FMAP) requirements for certain States in section 5001(g)(2) of the American Recovery and Reinvestment Act (Pub. L. 111-5, enacted on February 17, 2009) and strengthened by section 10201(c)(6) of the Affordable Care Act.
Response: The commenters cite section 10201(c)(6) of the Affordable Care Act, which added section 1905(cc) to the Act. Under this provision, a State may not be eligible for certain increased FMAPs associated with health care reform and disaster recovery if the State “requires that political subdivisions pay a greater percentage of the non-Federal share * * * than the respective percentages that would have been required by the State under the State plan under this title, State law, or both, as in effect on December 31, 2009.” Since the level of Federal funding available for the costs of the eligibility and enrollment determination systems under this final rule will increase and the level of the non-Federal share specific to such expenditures will decrease, there could be an effect on the level of required political subdivision contributions that would be subject to this limitation. We already issued guidance on how the political subdivision contribution limitations under section 1905(cc) apply in an SMD letter issued November, 9, 2010 (see http://www.cms.gov/smdl/downloads/SMD10023.pdf). Rather than reiterate what is already in that guidance, we refer States and counties to such guidance. States and counties may also work with CMS to determine whether any required contributions by political subdivisions toward the non-federal share of these expenditures would be in compliance with political subdivision contribution provision.
Comment: One commenter urged CMS to encourage States to consider in establishing actuarially sound Medicaid managed care rates, the additional systems-related investments by Medicaid health plans that are likely to be needed to interface with new State systems.
Response: We believe this commenter is asking about managed care rates, and not the proposal we issued with regard to mechanized claims processing and information retrieval systems, and when they will be eligible for enhanced FFP. As our proposed rule did not address Medicaid managed care rates, we believe this comment is outside the scope of the proposed rule.
Comment: One commenter asked for clarification on whether the addition of eligibility determination and enrollment systems is limited to stand-alone systems administered directly by the single State Medicaid Agency. The commenter indicates that some State eligibility systems are a joint venture with the HHS and the United States Department of Agriculture and are used to determine eligibility for financial assistance programs in addition to medical assistance programs.
Response: The enhanced funding can apply to “stand alone” systems or “integrated eligibility” systems, assuming they meet the standards and conditions specified in this final rule. Many States are considering ways to coordinate Medicaid, CHIP and Exchange eligibility with other health and human services programs. However, we will only provide enhanced funding for the portion of the costs that can be directly attributed to Medicaid eligibility and enrollment functions. We also direct the commenter to the discussion on cost-allocation in OMB Circular A-87 (http://www.whitehouse.gov/omb/circulars_a087_2004) specifying appropriate allocation of costs when the system includes various benefiting programs.
Comment: Other commenters have asked whether the enhanced funding can be used to support updating and completing the MITA assessment and roadmap, and performance measurement.
Response: We agree with the commenters that it is appropriate to request enhanced funding for updating the MITA assessment and the roadmap, since one of the standards and conditions listed in § 433.112 speaks directly to MITA maturity. Enhanced funding is available assuming that updates are related to the standards and conditions and the State's plan for meeting them. We are making no further additions to the rule in response to this comment.
Comment: Some commenters believed the timeframes related to the enhanced funding for the development of eligibility solutions seems to be extremely aggressive. Many of the activities related to the planning, design, development, and deployment of eligibility solutions will be new activities for both State and vendor staff. States will need to consider how they will integrate and leverage eligibility solutions into their Health Insurance Exchanges, their integrated human services eligibility solutions, their MMIS, and other points of intersection. Just the planning phase leading up to an approved APD and FFP release could easily consume more than a year. The commenters suggested that CMS should consider lengthening the timeframes for the completion of these efforts related to eligibility components.
Response: We recognize that the timelines for developing new eligibility systems, and for submitting and approving new APDs, must be greatly accelerated from historical and traditional experiences and approaches in order to meet the timelines in the Affordable Care Act and to take advantage of enhanced match prior to December 31, 2015. We emphasize that we expect to operate efficiently in processing APDs and work collaboratively with States to implement these changes, and we expect States to operate quite differently in how they pursue new development, share and reuse assets, and take advantage of “lightweight” applications and new technologies to meet these needs. Wenoted in our proposed rule that dramatic systems transformations would be necessary and while the timeframes may appear aggressive to some, the Department is committed to providing leadership, technical assistance, and financial support to produce the IT infrastructure necessary to accomplish the tasks required by the Affordable Care Act according to the timelines specified in the law. We note that the Affordable Care Act requires that States be able to enroll the newly eligible individuals and coordinate with Health Insurance Exchanges by January 1 of 2014. Thus, our timeline accounts for this statutory deadline, while still maintaining a period of two years (through December 31, 2015) to account for potential delays or unforeseen obstacles in developing new or improved eligibility determination systems.
We are making no further revisions to the rule as a result of this comment.
B. Requests for Additional Guidance ↑
Comment: One commenter requested that CMS produce and make available to the States a project planning template illustrating key entry points to major phases of the projects.
Response: We will be providing a whole series of artifacts and supporting tools, documentation, diagrams to States as part of our technical assistance, collaboration, and governance. We will consider the usefulness of a template for project planning as we develop and publish these materials.
Comment: Several commenters requested additional guidance on the IT enterprise.
Response: We will issue additional Guidance for Exchange and Medicaid Information Technology Systems (IT guidance). We issued IT guidance version 1.0 on November 30, 2010, and expect to issue, expand and renew that guidance over time. These guidance documents will help States with the business rules necessary to design, develop, and implement State eligibility systems that can meet the requirements of the Affordable Care Act.
Comment: Several commenters inquired about future guidance on MITA, the MITA alignment process, and whether the process for certifying and/or validating MITA alignment will be detailed in the final rule.
Response: We have provided continued guidance and artifacts associated with MITA since the MITA Initiative began. We will continue to provide that guidance and related toolsets and details. We will consider a number of elements in reviewing states' alignment with MITA and increasing MITA maturity, including States' self-assessments and MITA roadmaps.
Comment: Several commenters inquired about the “modular, flexible approach to systems development” and increasing MITA alignment requirements, as well as whether such requirements apply to all MMISs or only eligibility determination systems. The commenters believed that to promote the feasibility of a “modular, flexible approach to systems development” of Medicaid systems, CMS should continue to fund and aggressively develop necessary interfaces and technical standards that are required to facilitate MMIS interoperability.
Response: As stated in the above responses, we intend to issue a series of tools for States to use in ensuring the facilitation of interoperability. It should be noted that the requirements of this final rule apply to all MMISs, not just eligibility determination systems (which will now be considered part of the MMIS). We are making no further additions to the rule as a result of this comment.
Comment: Several commenters urged CMS to develop stronger Federal guidelines for enrollment and renewal procedures to accompany new eligibility systems, including guidance on acceptable data matches creating safe harbors for data sources used in electronic income verification, to allow States to move to paperless income verification with confidence that they comply with quality and accuracy standards. In developing additional requirements, the commenters urged CMS to ensure that Medicaid's application, renewal and verification procedures are no more paperwork intensive or burdensome than those for Exchange tax credit applicants.
Response: We agree with the commenters that simp