States Get More Info On Affordable Care Act Medicaid Eligibility Maintenance Of Effort; Payers & Providers Must Monitor

On February 27, 2011, Department of Health and Human Services Secretary Kathleen Sebelius issued a new letter and a frequently asked questions (FAQ) document that explain Medicaid and Children’s Health Insurance Program (CHIP) provisions in the Affordable Care Act in ways that afford greater flexibility to States.  The new guidance clarifies aspects of the maintenance of effort (MOE) rules for Medicaid and CHIP.  According to HHS, added guidance will follow.  In these turbulent financial times, states are likely to welcome guidance that allows them more flexibility.  While HHS and the states work out the detaails of these rules, health care providers and health plans also must keep a close eye out for developments that may require changes in enrollment or coverage coordination procedures to ensure their ability to comply with these evolving requirements.

The Medicaid MOE provision in the Affordable Care Act generally ensures that States’ eligibility rules for adults under the Medicaid program remain in place pending implementation of eligibility rules changes that become effective in January 2014.  The MOE provision for children extends to 2019.

The letter and supporting FAQ document released February 27, 2011 address three aspects of the MOE provisions:

  • The MOE exemption for higher-income adult populations in States that are experiencing budget deficits.  Under the Affordable Care Act, if a State has or projects a budget deficit, the MOE provision does not apply to adults who are not eligible for coverage on the basis of pregnancy or disability and whose incomes are above 133 percent of the Federal poverty level.  The FAQ document explains State options and how States can seek this exemption.
  • The implication of the MOE provision on Section 1115 demonstration projects.  Some States cover groups of people under Medicaid through a Section 1115 demonstration.  As explained in the FAQ document, the MOE provision generally applies to these waivers and demonstrations.  However, waivers and demonstration are, by their terms, time limited.  The guidance clarifies that the MOE provision does not require States to seek a new or renewed waiver after the expiration of their waiver or demonstration.
  • How premiums are treated under the MOE requirements.  Because premiums and premium increases have an impact on eligibility, previous guidance under the Recovery Act explained that new or increased premiums were considered to be a violation of the Recovery Act MOE requirement.  Because the period during which the Affordable Care Act MOE provisions apply is considerably longer than the MOE period under the Recovery Act, this new guidance offers States additional flexibility relating to premiums and the MOE requirements under the Affordable Care Act.  This will help a number of States that have been requesting the ability to adjust premiums for populations such as children in CHIP with family incomes above 150 percent of the Federal poverty line.

For Help With Compliance, Investigations Or Other Needs

If you need assistance responding to or monitoring changes in Medicaid, CHIP or other federal or state health program eligibility rules or dealing with other health care related risk management, compliance, enforcement or management concerns, the author of this update, attorney Cynthia Marcotte Stamer, may be able to help. Vice President of the North Texas Health Care Compliance Professionals Association, Past Chair of the ABA Health Law Section Managed Care & Insurance Section and the former Board Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has more than 23 years experience advising health industry clients about these and other matters. Ms. Stamer has extensive experience advising and assisting health care providers and other health industry clients to establish and administer medical privacy and other compliance and risk management policies and to respond to OCR, FTC, medical board and other health care industry investigation, enforcement and other compliance, public policy, regulatory, staffing, and other operations and risk management concerns. A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns including a number of programs and publications on Medicare quality and other compliance concerns.  Her publications and insights on HIPAA and other related matters appear in the Health Care Compliance Association, Atlantic Information Service, Bureau of National Affairs, World At Work, The Wall Street Journal, Business Insurance, the Dallas Morning News, Modern Health Care, Managed Healthcare, Health Leaders, and a many other national and local publications.  You can get more information about her health industry experience here. If you need assistance with these or other compliance concerns, wish to inquire about arranging for compliance audit or training, or need legal representation on other matters please contact Ms. Stamer at (469) 767-8872 or via e-mail here.

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THE FOLLOWING DISCLAIMER IS INCLUDED TO COMPLY WITH AND IN RESPONSE TO U.S. TREASURY DEPARTMENT CIRCULAR 230 REGULATIONS.  ANY STATEMENTS CONTAINED HEREIN ARE NOT INTENDED OR WRITTEN BY THE WRITER TO BE USED, AND NOTHING CONTAINED HEREIN CAN BE USED BY YOU OR ANY OTHER PERSON, FOR THE PURPOSE OF (1) AVOIDING PENALTIES THAT MAY BE IMPOSED UNDER FEDERAL TAX LAW, OR (2) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY TAX-RELATED TRANSACTION OR MATTER ADDRESSED HEREIN.©2011 Cynthia Marcotte Stamer, P.C.  Non-exclusive license to republish granted to Solutions Law Press.  All other rights reserved.

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