The CMS intends to permanently boost funding to help states build and maintain Medicaid eligibility and enrollment systems.
In 2011, the CMS raised the matching rate to 90% from 50% for money that states spend on building eligibility and enrollment systems, and to 75% from 50% for maintenance and operations of those systems. The bump in funds was set to expire in December 2015, but the agency decided the aid should be permanent.
“We believe that most states have not had sufficient time to complete the total system replacement for … eligibility functionality,” the agency said in a proposed rule. “Without ongoing enhanced federal funding, state Medicaid eligibility and enrollment systems are likely to become out of date and would not be able to coordinate with, and further the purposes of, the overall mechanized claims processing and information retrieval systems.”
The agency first alerted Medicaid directors about its intention to make the bump permanent via a letter (PDF) last fall and promised to make it official with a formal policy.
When the enhancement was first announced, the CMS estimated the funding would cost the federal government $1.1 billion over the four-year period. The agency now predicts it will spend $3 billion between fiscal 2016 and fiscal 2025 on implementing the proposed regulation.
All states are expected to take advantage of the funding in some form. There are only nine states, unidentified by the agency, that have adequately updated their systems and don't need major, wholesale upgrades. However, it is expected these states will continue to make modular improvements and upgrades.
Twenty-eight states are expected to move quickly to retire their legacy systems thanks to the ongoing 90% match, the agency estimated.
Last year, the CMS flagged Alaska, California, Kansas, Michigan, Missouri and Tennessee for ongoing technical and administrative woes that delayed Medicaid access.
Medicaid advocates say the states that are furthest behind in updating their eligibility systems are ones with conservative leaders who oppose the Affordable Care Act.
Comments on the proposal will be due by June 16.