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This proposed rule proposes to implement provisions of the Medicaid statute pertaining to Medicaid eligibility and appeals. This proposed rule continues our efforts to provide guidance to assist States in implementing Medicaid and CHIP eligibility, appeals, and enrollment changes required by the Affordable Care Act.

Statement of Need:

On January 22, 2013, we published a proposed rule entitled "Essential Health Benefits in Alternative Benefit Plans, Eligibility Notices, Fair Hearing and Appeal Processes for Medicaid and Exchange Eligibility Appeals and Other Provisions Related to Eligibility and Enrollment for Exchanges, Medicaid and CHIP, and Medicaid Premiums and Cost Sharing" that proposed changes to provide states more flexibility to coordinate Medicaid and CHIP procedures related to eligibility notices, appeals, and other related administrative actions with similar procedures used by other health coverage programs authorized under the Affordable Care Act. We received a number of public comments on the proposed rule suggesting alternatives that we had not originally considered and did not propose. To give the public the opportunity to comment on those options, we are now proposing revisions related to those comments. In addition, we propose to make other corrections and modifications related to delegations of eligibility determinations and appeals, and appeals procedures. We have developed these proposals through our experiences working with states and Exchanges, and Exchange appeals entities operationalizing fair hearings.

Summary of the Legal Basis:

The Affordable Care Act extends and simplifies Medicaid eligibility. The rule proposes alternatives not included in the previously published January 22, 2013 proposed rule, based on public comments received.

Alternatives:

The majority of Medicaid and CHIP eligibility provisions proposed in this rule serve to implement the Affordable Care Act. Therefore, alternatives considered for this rule were constrained due to the statutory provisions.

Anticipated Costs and Benefits:

While states will likely incur short-term increases in administrative costs, we do not anticipate that this proposed rule would have significant financial effects on state Medicaid programs. The extent of these initial costs will depend on current state policy and practices, as many states have already adopted the administrative simplifications addressed in the rule. In addition, the administrative simplifications proposed in this rule may lead to savings as states streamline their fair hearing processes, consistent with the processes used by the Marketplace, and implement timeliness and performance standards.

Risks:

None. Delaying publication of this rule delays states from moving forward with implementing changes to Medicaid and CHIP, and aligning operations between Medicaid, CHIP and the Exchanges.