Factsheet on Updated Policy for Maintaining Medicaid Enrollment During the Public Health Emergency for COVID-19 (CMS-9912)

Summary

This CMS factsheet is titled CMS-9912 Interim Final Rule with Comment, on updated policy for maintaining Medicaid enrollment during the Public Health Emergency for COVID-19. It says the Families First Coronavirus Response Act, signed on March 18, 2020, lets states claim a temporary 6.2 percentage point increase in the federal medical assistance percentage if conditions in section 6008(b) are met. Under the new section 433.400, states must keep the Medicaid enrollment of validly enrolled beneficiaries through the end of the month in which the emergency ends, within one of three tiers of coverage. A beneficiary who is not validly enrolled, such as one whose eligibility was granted in error by the agency, can be terminated with advance notice and fair hearing rights.

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CMS-9912 Interim Final Rule with Comment Factsheet on Updated Policy for Maintaining
      Medicaid Enrollment during the Public Health Emergency for COVID-19
On March 18, 2020 President Trump signed the Families First Coronavirus Response Act
(FFCRA; P.L. 116-127) into law in response to the Public Health Emergency (PHE) for
coronavirus disease 2019 (COVID-19). Section 6008 of the FFCRA authorizes states to claim a
temporary 6.2 percentage point increase in the federal medical assistance percentage (FMAP) if
they satisfy certain conditions laid out in section 6008(b).
CMS’s original interpretation of the conditions specified in section 6008(b)(3) was issued in
guidance, in the form of frequently asked questions, in April, May and June 2020. This
interpretation prevented states from implementing certain changes to effectively manage their
programs. On 10/28, CMS published CMS-9912-IFC which establishes a new section 433.400
in Part 433 of Title 42 of the Code of Federal Regulations that reinterprets the condition in
section 6008(b)(3) of the FFCRA under which states claiming the temporary FMAP increase
must maintain beneficiary enrollment through the end of the month in which the PHE for
COVID-19 ends, and includes additional safeguards to protect beneficiaries.

Overview of New Section 42 C.F.R. 433.400

Initial CMS guidance on section 6008(b)(3) of the FFCRA required states, as a condition for
receiving the temporary FMAP increase, to maintain the enrollment and coverage of all
Medicaid beneficiaries through the end of the month in which the PHE for COVID-19 ends.
Under this initial guidance, states were prohibited from making any changes to the benefits
available to a beneficiary or to a beneficiary’s required cost sharing or, in the case of
institutionalized beneficiaries, to their financial responsibility for the cost of care under the post-
eligibility treatment of income rules.

Under the new regulations at 42 C.F.R. section 433.400, in order to claim the temporary FMAP
increase, states must maintain the Medicaid enrollment of “validly enrolled beneficiaries” in one
of three tiers of coverage. Such enrollment must be maintained, with certain exceptions, through
the end of the month in which the PHE for COVID-19 ends. States may terminate individuals
not validly enrolled, after providing advance notice and fair hearing rights per 42 C.F.R. Part 431
Subpart E, and still claim the temporary FMAP increase. Section 433.400 permits states to make
changes to beneficiary coverage, cost sharing and post-eligibility treatment of income without
violating the condition in section 6008(b)(3) of the FFCRA. This includes both individual
changes and changes to the state plan, a section 1115 demonstration and/or a waiver authorized
under section 1915 of the Act, provided such change is consistent with other federal Medicaid
requirements.

Details about the Requirements in 42 C.F.R § 433.400

Which beneficiaries would NOT be considered validly enrolled beneficiaries under § 433.400?
Beneficiaries generally are considered to be validly enrolled. However, a beneficiary is not
validly enrolled if the state Medicaid agency determines that:
    • The determination of eligibility was incorrect at the time it was made due to agency error.
   •   Eligibility was erroneously granted due to beneficiary fraud for which the beneficiary has
       been convicted or beneficiary abuse as determined by the agency in accordance with
       existing regulations at 42 C.F.R. § 455.16.
Individuals receiving coverage during a presumptive eligibility period are not considered validly
enrolled beneficiaries for purposes of section 433.400.

What are the three tiers of coverage under § 433.400?
Section 433.400 establishes the following three tiers of coverage for the purpose of satisfying the
condition to maintain coverage in states claiming the temporary FMAP increase.
1. Minimum Essential Coverage (MEC): Medicaid coverage that meets the definition of MEC
   at 26 C.F.R. 1.5000A-2, including coverage in Medicare with coverage under a Medicaid
   Medicare Savings Program eligibility group (this includes the eligibility groups for Qualified
   Medicare Beneficiaries, Specified Low-Income Medicare Beneficiaries, Qualifying
   Individuals and Qualified Working Disabled Individuals). This tier provides the most robust
   coverage.
2. Non-MEC with coverage of COVID-19 testing and treatment: Medicaid coverage that does
   not meet the definition of MEC, but does include coverage for testing services and treatments
   for COVID-19 including vaccines, specialized equipment, and therapies. Some states provide
   tier 2 coverage under a section 1115 demonstration project, and in some states, coverage
   provided to pregnant or postpartum women under 42 C.F.R. 435.116 is not MEC and would
   also be included in tier 2.
3. Non-MEC with limited benefits: Medicaid coverage that does not meet the requirements of
   tier 1 or tier 2 because it is not MEC and does not include testing and treatment for COVID-
   19; examples of such limited benefit coverage include coverage available through the
   eligibility groups limited to family planning or tuberculosis-related services. This tier
   provides the least robust coverage.
A beneficiary may transition from one eligibility group to another eligibility group during the
PHE for COVID-19, as long as the new eligibility group provides the same tier of coverage, with
an exception for the non-MEC coverage in tier 3 because the benefits are much more limited
and may vary widely; beneficiaries receiving tier 3 coverage generally must continue to receive
the same coverage for which they have been enrolled. In addition, a beneficiary may move to a
tier with more robust coverage, but may not be transitioned to a tier with less robust coverage
unless the beneficiary requests such transition.

Are there any individuals whose coverage may be terminated prior to the end of the PHE?
In states claiming the temporary FMAP increase, a beneficiary’s Medicaid enrollment may be
terminated prior to the first day of the month after the PHE for COVID-19 ends if:
1. The beneficiary requests a voluntary termination of eligibility;
2. The beneficiary dies;
3. The beneficiary ceases to be a resident of the state; or
4. The beneficiary was not validly enrolled, as described above.
Note that a beneficiary may be identified, through a data match with the Public Assistance
Reporting Information System (PARIS), as receiving assistance under a benefit program in more
than one state. In such cases, if the state is unable to verify the beneficiary’s continued residency
in the state because the beneficiary fails to respond to requests for additional information and the
state makes alternative efforts but cannot verify the beneficiary’s continued residency in the state
through other sources, that beneficiary’s Medicaid enrollment may be terminated in accordance
with 435.400(d)(1)(ii). If the individual subsequently provides information to verify state
residency, the state must reinstate the beneficiary’s Medicaid enrollment.

What happens when a validly enrolled beneficiary becomes ineligible or eligible only for a less
robust tier of coverage?
If a validly enrolled beneficiary becomes ineligible for Medicaid under any eligibility group or
demonstration project, to qualify for the FFCRA increase FMAP, the state must maintain the
beneficiary’s enrollment and continue to provide the same tier of Medicaid coverage that the
beneficiary would have received absent the determination of ineligibility. If a validly enrolled
beneficiary becomes eligible only for a group or demonstration project providing a less robust
tier of coverage, to qualify for the FFCRA increase FMAP, under section 433.400 the state may
move the validly enrolled beneficiary to a tier with more robust coverage, but may not transition
the beneficiary to a tier with less robust coverage unless the beneficiary requests such transition.


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