Frequently Asked Questions

Generally, no. Section 2105(c) (8) of the Social Security Act limits enhanced FMAP to the expenditures associated with children whose effective family income is at or below 300 percent FPL. Expenditures for children whose effective family income exceeds 300 percent of the FPL are matched at the regular Medicaid FMAP rate rather than the enhanced FMAP. However, the enhanced matching rate continues to be available for expenditures on populations whose income exceeds 300% FPL in states in which the income standard exceeds 300 percent as a result of MAGI conversion, as well as for states with approved income limits for CHIP above 300% of the FPL prior to the passage of the Children's Health Insurance Program Reauthorization Act (CHIPRA).

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• This FAQ was released as part of a larger set. View the full set. (PDF, 120.92 KB)

FAQ ID:91891

States are no longer allowed to cover parents in CHIP after Sept. 30, 2013 and therefore, are no longer eligible to receive the enhanced CHIP FMAP for expenditures for parents.

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FAQ ID:91896

As applicant information is entered into state systems, there will be some applicants that will be known to the system, such as people who previously applied to or enrolled in Medicaid, family members of current beneficiaries, and possibly beneficiaries of other human services programs. If, based on this information known to the system, the state finds information that indicates the individual is unlikely to be eligible for Medicaid under MAGI rules, then the state may treat such information as an inconsistency. Just as states are not enrolling applicants on the flat file who have an inconsistency in their income or residency information based on FFM verification without further evaluation, states may also not enroll applicants based on the flat-file data for whom there are discrepancies based on state system information. We will work with states that would like to pursue other options for dealing with information found in state systems when entering individuals from the flat file.

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FAQ ID:91911

This issue has been identified to be resolved but the state can proceed to enroll these accounts. The expanded flat file will contain several other fields giving enough information to effectuate enrollment while this issue is resolved. We will work with states that believe they have a problem proceeding to enroll these applicants.

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• This FAQ was released as part of a larger set. View the full set. (PDF, 198.3 KB)

FAQ ID:91961

States wishing to continue the practice of disregarding parental income may do so by adopting coverage of a reasonable classification of individuals under age 21 under section 42 CFR 435.222. In this case, the "reasonable classification" would be pregnant individuals under age 21 (or under age 18, 19, or 20). The statutory income standard for this group would be based on the state's AFDC payment standard in effect in the state in July 1996. But if a state uses section 1902(r)(2) of the Act to disregard all income for this group, as has been done for other reasonable classifications of children (such as those in state foster care), there will be no determination of income required for eligibility, and MAGI-based income requirements will not apply.

To effectuate this option, states should submit a state plan amendment (SPA) to amend Attachment 2.2-A of the Medicaid state plan to cover a reasonable classification of pregnant individuals under age 21 under 42 CFR 435.222. The state should also amend Supplement 8a to Attachment 2.6-A to disregard all income for this new group.

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• This FAQ was released as part of a larger set. View the full set. (PDF, 295.71 KB)

FAQ ID:92601

The Medicaid statute provides several options for states to pay premiums for adults and children to purchase coverage through private group health plans, and in some case individual plans; in most cases, the statute conditions such arrangements on a determination that they are "cost effective." Cost effective generally means that Medicaid's premium payment to private plans plus the cost of additional services and cost sharing assistance that would be required would be comparable to what it would otherwise pay for the same services. Similar provisions also apply in the Children's Health Insurance Program (CHIP).

Under all these arrangements, beneficiaries remain Medicaid beneficiaries and continue to be entitled to all benefits and cost-sharing protections. States must have mechanisms in place to "wrap-around" private coverage to the extent that benefits are less and cost sharing requirements are greater than those in Medicaid. In addition under the statutory options in the individual market beneficiaries must be able to choose an alternative to private insurance to receive Medicaid benefits.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 40.01 KB)

FAQ ID:93841

Some states have expressed interest in section 1115 demonstrations to provide premium assistance for the purchase of QHPs in the Exchange. Under section 1115 of the Social Security Act, the Secretary may approve demonstration projects that she determines promote the objectives of the Medicaid program. HHS will consider approving a limited number of premium assistance demonstrations since their results would inform policy for the State Innovation Waivers that start in 2017. As with all such demonstrations, HHS will evaluate each proposal that is submitted and consider it on a case by case basis relative to this standard.

With regard to premium assistance demonstrations, HHS will consider states' ideas on cost effectiveness that include new factors introduced by the creation of Health Insurance Marketplaces and the expansion of Medicaid. For example, states may quantify savings from reduced churning (people moving between Medicaid and Exchanges as a result of fluctuating incomes) and increased competition in Marketplaces given the additional enrollees due to premium assistance. As with all demonstration proposals, the actuarial, economic, and budget justification (including budget neutrality) would need to be reviewed and, if approved, the program and budgetary impact would need to be carefully monitored and evaluated.

To ensure that the demonstrations further the objectives of the program and provide information in a timely way, HHS will only consider proposals that:

• Provide beneficiaries with a choice of at least two qualified health plans (QHPs).
• Make arrangements with the QHPs to provide any necessary wrap around benefits and cost sharing along with appropriate data; this would be done within the context of premium assistance, for example through a supplemental premium. This ensures that coverage is seamless, that cost sharing reductions are effectively delivered and that there is accountability for the payments made.
• Are limited to individuals whose benefits are closely aligned with the benefits available on the Marketplace, that is, individuals in the new Medicaid adult group who must enroll in benchmark coverage and are not described in SSA 1937(a)(2)(B)(an example of a population that is described in SSA 1937(a)(2)(B) is the medically frail). Marketplace plans were not designed to offer broader benefits and could experience unexpected adverse selection due to enrollment of groups that are described in SSA 1937(a)(2)(B).
• End no later than December 31, 2016. Starting in 2017, State Innovation Waiver authority begins which could allow a range of State-designed initiatives.

In addition, a state may increase the opportunity for a successful demonstration by choosing to target within the new adult group individuals with income between 100 and 133 percent of FPL. Medicaid allows for additional cost-sharing flexibility for populations with incomes above 100 percent of FPL; this population is more likely to be subject to churning and would be eligible for advance premium tax credits and Marketplace coverage if a state did not expand Medicaid to 133 percent of FPL.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 40.01 KB)

FAQ ID:93846

No. As stated in the past, the Affordable Care Act does not provide for a phased-in or partial expansion. States that wish to take advantage of the enhanced federal matching funds for newly eligible individuals must extend eligibility to 133% of the federal poverty level (FPL) by adopting the new adult group. Arkansas has initiated discussions about "premium assistance" options for Medicaid beneficiaries; partial expansion is not part of these discussions.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 40.01 KB)

FAQ ID:93851

The Medicaid statute provides several options for states to pay premiums for adults and children to purchase coverage through private group health plans, and in some case individual plans; in most cases, the statute conditions such arrangements on a determination that they are "cost effective." Cost effective generally means that Medicaid's premium payment to private plans plus the cost of additional services and cost sharing assistance that would be required would be comparable to what it would otherwise pay for the same services. Similar provisions also apply in the Children's Health Insurance Program (CHIP).

Under all these arrangements, beneficiaries remain Medicaid beneficiaries and continue to be entitled to all benefits and cost-sharing protections. States must have mechanisms in place to "wrap-around" private coverage to the extent that benefits are less and cost sharing requirements are greater than those in Medicaid. In addition under the statutory options in the individual market beneficiaries must be able to choose an alternative to private insurance to receive Medicaid benefits.

A state may pursue premium assistance as a state plan option without a waiver.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 40.01 KB)

FAQ ID:93856

Some states have expressed interest in section 1115 demonstrations to provide premium assistance for the purchase of QHPs in the Exchange. Under section 1115 of the Social Security Act, the Secretary may approve demonstration projects that she determines promote the objectives of the Medicaid program. HHS will consider approving a limited number of premium assistance demonstrations since their results would inform policy for the State Innovation Waivers that start in 2017. As with all such demonstrations, HHS will evaluate each proposal that is submitted and consider it on a case by case basis relative to this standard.

With regard to premium assistance demonstrations, HHS will consider states' ideas on cost effectiveness that include new factors introduced by the creation of Health Insurance Marketplaces and the expansion of Medicaid. For example, states may quantify savings from reduced churning (people moving between Medicaid and Exchanges as a result of fluctuating incomes) and increased competition in Marketplaces given the additional enrollees due to premium assistance. As with all demonstration proposals, the actuarial, economic, and budget justification (including budget neutrality) would need to be reviewed and, if approved, the program and budgetary impact would need to be carefully monitored and evaluated.

To ensure that the demonstrations further the objectives of the program and provide information in a timely way, HHS will only consider proposals that:

• Provide beneficiaries with a choice of at least two qualified health plans (QHPs).
• Make arrangements with the QHPs to provide any necessary wrap around benefits and cost sharing along with appropriate data; this would be done within the context of premium assistance, for example through a supplemental premium. This ensures that coverage is seamless, that cost sharing reductions are effectively delivered and that there is accountability for the payments made.
• Are limited to individuals whose benefits are closely aligned with the benefits available on the Marketplace, that is, individuals in the new Medicaid adult group who must enroll in benchmark coverage and are not described in SSA 1937(a)(2)(B)(an example of a population that is described in SSA 1937(a)(2)(B) is the medically frail). Marketplace plans were not designed to offer broader benefits and could experience unexpected adverse selection due to enrollment of groups that are described in SSA 1937(a)(2)(B).
• End no later than December 31, 2016. Starting in 2017, State Innovation Waiver authority begins which could allow a range of State-designed initiatives.

In addition, a state may increase the opportunity for a successful demonstration by choosing to target within the new adult group individuals with income between 100 and 133 percent of FPL. Medicaid allows for additional cost-sharing flexibility for populations with incomes above 100 percent of FPL; this population is more likely to be subject to churning and would be eligible for advance premium tax credits and Marketplace coverage if a state did not expand Medicaid to 133 percent of FPL.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 40.01 KB)

FAQ ID:93861