More Options for Eligibility Determination Potentially Crack the Seamless System

This week, CMS released a Q & A on State-Exchange Implementation with new information on several topics, which are described below. Of concern and worth highlighting is the disappointing departure from the proposed rules by now allowing states that choose not to implement a state-based exchange to retain control over Medicaid and CHIP eligibility. The Notice of Proposed Rulemaking (NPRM) issued on August 12, 2011 supported the vision of a seamless, streamlined system, ensuring that the Exchange would determine eligibility and enroll all applicants in the program that best matches their circumstances, be it Medicaid, CHIP, the Basic Health Plan or subsidized coverage in the Exchange. Instead, the Q & A allows the state to opt for the federal exchange to only conduct a preliminary assessment of Medicaid and CHIP eligibility, leaving the final determination to the Medicaid or CHIP agency.

This concept is similar to the “screen and enroll” provisions currently in place for Medicaid and CHIP that have yet to be perfected. It has taken years to identify and fill the cracks in the system and this experience has shown that a single point of entry and single eligibility system results in fewer eligible individuals slipping through the cracks. The new option offered to states in the Q & A perpetuates the current bifurcated system. This will require more concerted oversight and tracking to ensure that the “eligibility handoff” is successful. If CMS is not going to fulfill the full promise of a seamless, streamlined system, then it will be critically important to establish strong performance metrics (and penalties) to ensure that individuals and families are not asked to provide the same information to multiple agencies and that specific timeliness standards are met.

Another new option potentially will allow states that choose to establish a state-based Exchange to access federally-managed eligibility determinations for premium tax credits and reduced cost-sharing reduction, access to minimum essential coverage and exemptions to the individual mandate. It is somewhat unclear if CMS intends to simply do the determinations for states or allow them access to a new “shared service.” This option has major implications for state information technology (IT) systems, in particular, giving states more time to upgrade or build new eligibility systems of their own.

In addition to the new eligibility determination options, the Q & A also provides the following information:

Costs to States – For those states that choose to have the federal Exchange determine eligibility for Medicaid and CHIP, there will be no cost to states for the eligibility determination. However, states will be required to share in the cost of the interfaces needed to exchange data. States also will not have to pay for data accessed through the federal data services hub, which will provide eligibility information including modified adjusted gross income (MAGI), as well as citizenship and immigration status.

Exchange Establishment Grants – The clock has been ticking on securing Exchange establishment grants with the final of three more rounds of funding set for June 29, 2012. The Q & A indicates that CMS will modify and extend the deadline for applying for these grants.  It also discusses how Exchange planning or establishment grants can be used in exploring and implementing the Basic Health Plan Option.

IRS Data – The Q & A outlines the data that will be available through the federal data hub, which does not appear to be all the data needed to verify applicant information such as the names of all tax dependents.

Quality Ratings for QHPs – States will be given more time to develop QHP-specific quality measures. CMS is proposing a phased approach to the quality rating provisions in which quality ratings in 2014 would be based on existing quality metrics and measures, transitioning to a QHP-specific rating in 2016.

Audits – The Q & A reassures states that audits will be based on current federally-approved state policy. So for example, if a state allows (and the federal government approved the state plan for) self-attestation of income, then the statement of the applicant, not other data, will be used for audit purposes.

Other – There’s more in the Q & A on risk adjustment, coordination of the federal exchange with existing state insurance rules and multi-state plans.

It’s helpful to see more details emerging on the implementation of exchanges, but many questions remain unanswered. Keep checking Say Ahhh! for the latest news from Washington as we continue on to 2014.

Tricia Brooks is a Research Professor at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.

Latest