I’m not big on rules. When I ran New Hampshire’s Children’s Health Insurance Program  and had to talk with a family who was unhappy about some bureaucratic rule, I often diffused the conversation by saying “I don’t make the rules, if I did there wouldn’t be any.” I know, that was a cop-out but it worked. Now I take those words back. This is one rule I might love!

The Centers for Medicaid & Medicare Services (CMS) has published a proposed rule in the federal register that would broaden the definition of “claims” to include “claims of eligibility” in regard to Medicaid management information systems. What does this really mean? It means that eligibility systems may qualify (assuming the rule is adopted) for a 90% federal financial participation to support the design, development, testing and implementation of new or enhanced eligibility systems capacity through 2015. Systems could also qualify for an ongoing 75% federal match once they are operational.

Is this a big deal? Indeed it is. States have been severely encumbered by a lack of resources to make system innovations or replace decades old legacy systems that, quite frankly, have outlived their usefulness due to a lack of major overhauls. Moving forward on streamlining efficiencies and the use of data matching to verify eligibility helps both states and real people but requires the latest in systems architecture and performance to achieve the innovations that we know are possible. These kinds of system transformations, along with seamless integration with Exchange IT systems, require major investments and the enhanced federal funding will be welcome news to cash-strapped states.

So, we commend CMS leadership for rightly justifying this rule change to ensure that Medicaid eligibility systems are as efficient and effective as possible and ready to fulfill the promise of coverage for millions of low- and moderate-income people envisioned by the Affordable Care Act. It is worth emphasizing that this is a time-limited opportunity (through 2015) and, given the time required to build these systems, states should get to work quickly.

The proposed rule was accompanied by new guidance for Exchange and Medicaid Information (IT) Systems that establishes a framework and approach for Exchange IT systems developed through the new Innovator Grants and for Medicaid IT systems supported by the 90% funding proposed in the rulemaking.  The Office of Consumer Information and Insurance Oversight (OCIIO) teamed up with CMS to issue the guidance.  It  will be updated over time, requiring states to comply with future iterations as well.

Coupled with last week’s announcement of 100% funding for five model Exchange IT systems through the Innovator Grants, this is big news and cause for celebration. There’s more detail worth sharing on the Innovators Grants that I promised when I posted the announcement. But first I have to update that blog because this latest action addresses a couple of issues I felt were omitted in the Innovator Grant release.

Without getting into the really technical requirements (which I’m not qualified to do), here are a few provisions that warm my heart:

1) The guidance requires IT systems to support a first-class customer experience, as well as seamless coordination between the Medicaid and CHIP programs and the Exchanges and between Exchanges and plans, employers and navigators.

2) The guidance also confirms that systems must comply with new 1561 standards developed by the National Office of the Coordinator for Health Information Technology, which envision consumer-focused systems that interface across multiple assistance programs. (Look for more on this in the Innovator Grants Part II blog.)

3) In the proposed rule, CMS anticipates additional standard federal requirements for more timely and detailed reporting of eligibility and enrollment statistics. The proposed rule goes on to indicate that CMS will develop a range of data and performance metrics on which states would be required to report on an ongoing basis. (This is where “like” turned to “love” for me!)

4) Like the Innovator Grants, states will be encouraged to share and reuse Medicaid technologies and systems within and among states.

5) Interoperability goes further than interfacing with Exchange IT systems and includes public health agencies, human service programs, and my favorite – community organizations providing outreach and enrollment assistance services.

All in all, the Innovator Grants, the proposed 90% funding for Medicaid IT systems, federal IT guidance with more to come, technical assistance from CMS and ICIIO and incentives for states to share and learn from one another will go a long way to bring the use of technology into the 21st century for our public coverage programs. There’s a lot of work to be done but no longer are we waiting for guidance and the extra resources to get started. Up first on our list is to make sure the proposal becomes the final rule. CCF will be working with our partners to draft supportive comments and to ensure the final rule is as strong for beneficiaries as possible. So stay tuned.