The CMS has finalized a rule to permanently retain funding that helps states upgrade the technology they need to allow their residents to enroll in Medicaid.
Nearly 25% of states are looking to modernize their aging, often very state-specific technology systems, many of which have experienced the stress of Medicaid expansion under the Affordable Care Act.
In 2011, the CMS raised its matching rate to 90% from 50% for money that states spent on building Medicaid eligibility and enrollment systems, and to 75% from 50% for maintenance and operations of those systems. The funding bump was set to expire in December but the agency made the funding permanent.
“We believe that most states have not had sufficient time to complete the total system replacement for … eligibility functionality,” the agency said in its final 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 “Without ongoing enhanced federal funding, state Medicaid eligibility and enrollment systems are likely to become out of date and would not be able to coordinate with, and further the purposes of, the overall mechanized claims processing and information retrieval systems.”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 received 61 comments before its June 15 deadline. The CMS first alerted Medicaid directors about its intention to make the funding bump permanent via a letter (PDF) in the fall, and promised to make it official with a formal policy.
The CMS initially estimated the raise would cost the federal government $1.1 billion over the first four-year period. The agency now predicts it will spend $3 billion between fiscal 2016 and fiscal 2025 on implementing the proposed regulation.
The nine states that have relatively new technology systems and do not need replacements are Colorado, Florida, Idaho, Montana, New Mexico, North Carolina, Oklahoma, Texas and Utah, according to the CMS.
The 28 states or territories that still have older, and in some cases, decades-old systems include: Alabama, Alaska, American Samoa, California, Connecticut, Georgia, Guam, Illinois, Louisiana, Maine, Maryland, Massachusetts, Michigan, Nebraska, Nevada, New York, North Dakota, Ohio, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, South Dakota, Tennessee, Vermont, the U.S. Virgin Islands and Wyoming.
Those states and territories are expected to move quickly to retire their legacy systems, thanks to the ongoing 90% match, the agency said.
Last year, the CMS flagged Alaska, California, Kansas, Michigan, Missouri and Tennessee for ongoing technical and administrative woes that delayed Medicaid access in their states.