CMS Offers Guidance on Health Reform Medicaid Expansion - April 13, 2010

On April 9, the Centers for Medicare and Medicaid Services (CMS) released guidance relating to the optional expansion of Medicaid to a new eligibility group up to 133% of federal poverty level (FPL), including non-disabled, childless adults, and others, depending on current state eligibility levels. States may set income eligibility standards for the new group at any level up to 133% FPL, but may not cover higher-income individuals before covering lower-income people. As is required when the mandatory expansion takes place in 2014, states may not apply an asset test; however, states do not have to use modified adjusted gross income during the phase-in period. The coverage provided to these individuals must consist of benchmark or benchmark-equivalent coverage as defined in the health care bill, except for certain individuals exempt from enrollment in benchmark coverage. States opting to phase-in coverage will not receive the enhanced federal matching rate under ARRA. (Beginning in 2014, states receive an increased FMAP provided in the health reform bill.) For those states seeking to phase-in the new group starting April 1, 2010, they must submit State Plan Amendments by June 30, 2010.