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Rule2023-20382

Streamlining Medicaid; Medicare Savings Program Eligibility Determination and Enrollment

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Published

September 21, 2023

Effective

November 17, 2023

Issuing agencies

Health and Human Services DepartmentCenters for Medicare & Medicaid Services

Abstract

This final rule simplifies processes for eligible individuals to enroll and retain eligibility in the Medicare Savings Programs (MSPs). This final rule better aligns enrollment into the MSPs with requirements and processes for other public programs. Finally, this final rule reduces the complexity of applications and reenrollment for eligible individuals.

Full Text

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<title>Federal Register, Volume 88 Issue 182 (Thursday, September 21, 2023)</title>
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[Federal Register Volume 88, Number 182 (Thursday, September 21, 2023)]
[Rules and Regulations]
[Pages 65230-65271]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-20382]

[[Page 65229]]

Vol. 88

Thursday,

No. 182

September 21, 2023

Part II

Department of Health and Human Services

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Centers for Medicare & Medicaid Services

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42 CFR Parts 406 and 435

Streamlining Medicaid; Medicare Savings Program Eligibility
Determination and Enrollment; Final Rule

Federal Register / Vol. 88 , No. 182 / Thursday, September 21, 2023 /
Rules and Regulations

[[Page 65230]]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 406 and 435

[CMS-2421-F]
RIN 0938-AU00

Streamlining Medicaid; Medicare Savings Program Eligibility
Determination and Enrollment

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Final rule.

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SUMMARY: This final rule simplifies processes for eligible individuals
to enroll and retain eligibility in the Medicare Savings Programs
(MSPs). This final rule better aligns enrollment into the MSPs with
requirements and processes for other public programs. Finally, this
final rule reduces the complexity of applications and reenrollment for
eligible individuals.

DATES: These regulations are effective November 17, 2023. Throughout,
however, we identify separate compliance dates that vary by provision,
thereby giving States additional time to implement the provisions of
this final rule.

FOR FURTHER INFORMATION CONTACT: Kim Glaun, (410) 786-3849,
<a href="/cdn-cgi/l/email-protection#046f6d692a636865716a446769772a6c6c772a636b72">[email&#160;protected]</a>, or Melissa Heitt, (410) 786-2484,
<a href="/cdn-cgi/l/email-protection#adc0c8c1c4dedecc83c5c8c4d9d9edcec0de83c5c5de83cac2db">[email&#160;protected]</a>.

SUPPLEMENTARY INFORMATION: This final rule addresses select provisions
and public comments from the proposed rule, published in the September
7, 2022 Federal Register (87 FR 54760). We intend to address the
remaining provisions and public comments from the proposed rule in
subsequent rulemaking.

I. Background

Millions of individuals with limited income and resources rely on
the Medicare Savings Programs (MSPs) to help cover Medicare Parts A and
B premiums and, often, cost-sharing. In accordance with section
1902(a)(10)(E) of the Social Security Act (the Act), MSPs are part of
States' Medicaid programs and assist individuals who need help paying
their Medicare costs.
The MSPs are essential to the health and well-being of those
enrolled, promoting access to care and helping free up individuals'
limited income for food, housing, and other life necessities. Through
the MSPs, Medicaid pays Medicare Part B premiums each month for over 10
million individuals and Part A premiums for over 700,000 individuals.
However, millions more are eligible but not enrolled. A 2017 study
conducted for the Medicaid and CHIP Payment and Access Commission
(MACPAC) estimated that only about half of eligible Medicare
beneficiaries were enrolled in MSPs.\1\
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\1\ Caswell, Kyle J., and Timothy A. Waidmann, ``Medicare
Savings Program Enrollees and Eligible Non-Enrollees,'' The Urban
Institute June 2017). <a href="https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf">https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf</a>.
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The Biden-Harris Administration is committed to protecting and
strengthening Medicaid. On January 20, 2021, President Biden issued
Executive Order 13985, charging Federal agencies with identifying
potential barriers that underserved communities may face to enrollment
in programs like Medicaid.\2\ This was followed on January 28, 2021 by
Executive Order 14009 with a specific call to strengthen Medicaid and
the Affordable Care Act and remove barriers to obtaining coverage for
the millions of individuals who are potentially eligible but remain
uninsured.\3\ The December 13, 2021 Executive Order 14058,
``Transforming Federal Customer Experience and Service Delivery to
Rebuild Trust in Government'' supports streamlining State enrollment
and renewal processes and removing barriers to ensure eligible
individuals are automatically enrolled in and retain access to critical
benefit programs.\4\ The April 5, 2022 Executive Order 14070,
``Continuing to Strengthen Americans' Access to Affordable, Quality
Health Coverage'' charges Federal agencies with identifying ways to
help more Americans enroll in quality health coverage.\5\ It calls upon
Federal agencies to examine policies and practices that make it easier
for individuals to enroll in and retain coverage. In response to these
Executive Orders, we examined ways to improve access to the MSPs.
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\2\ E.O. 13985, 86 FR 7009. <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/</a>.
\3\ E.O. 14009, 86 FR 7793. <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/28/executive-order-on-strengthening-medicaid-and-the-affordable-care-act/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/28/executive-order-on-strengthening-medicaid-and-the-affordable-care-act/</a>.
\4\ E.O. 14058, 86 FR 71357. <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/12/13/executive-order-on-transforming-federal-customer-experience-and-service-delivery-to-rebuild-trust-in-government/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/12/13/executive-order-on-transforming-federal-customer-experience-and-service-delivery-to-rebuild-trust-in-government/</a>.
\5\ E.O. 14070, 87 FR 20689. <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2022/04/05/executive-order-on-continuing-to-strengthen-americans-access-to-affordable-quality-health-coverage/">https://www.whitehouse.gov/briefing-room/presidential-actions/2022/04/05/executive-order-on-continuing-to-strengthen-americans-access-to-affordable-quality-health-coverage/</a>.
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We have learned through our experiences in working with States and
other interested parties that certain policies continue to result in
unnecessary administrative burden and create barriers to enrollment and
retention of coverage for eligible individuals. For example, there are
no regulations to facilitate enrollment in the MSPs. In particular, we
do not have regulations to link enrollment in other Federal programs
with the MSPs, despite the high likelihood that individuals in such
programs are eligible for the MSPs. This hinders States' ability to
efficiently enroll those known to be eligible. Additionally, interested
parties report that burdensome documentation requirements substantially
impede eligible individuals from enrolling in the MSPs.\6\
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\6\ In October 2020, CMS engaged with 55 interested parties
across four States to better understand experiences when applying
for the MSPs. One of the main findings was that burdensome
documentation requirements substantially impede eligible individuals
from enrolling in the MSPs and that easing these requirements is a
critical step to ensuring individuals can obtain and retain these
critical benefits.
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In this rulemaking, we finalize policies to streamline MSP
eligibility and enrollment processes, reduce administrative burden on
States and applicants, and increase enrollment and retention of
eligible individuals.
Current regulations at 42 CFR 433.112 establish conditions that
State eligibility and enrollment systems must meet to qualify for
enhanced Federal matching funds. Among these conditions, Sec.
433.112(b)(14) requires that each State system support accurate and
timely processing and adjudications/eligibility determinations. As
States submit proposed changes to their eligibility and enrollment
systems and implement new and/or enhanced functionality, we will
continue to provide them with technical assistance on the policy
requirements, conduct ongoing reviews of both the State policy and
State systems, and ensure that all proposed changes support more
accurate and timely processing of eligibility determinations.
We recognize that the COVID-19 pandemic disrupted routine
eligibility and enrollment operations for Medicaid.\7\ As States have
resumed

[[Page 65231]]

routine operations (a process we refer to as ``unwinding'') they are
faced with the challenge of re-assessing eligibility for a
significantly larger number of enrollees than ever before. From
February 2020 through March 2023, enrollment in Medicaid increased by
35.3 percent, or over 22 million individuals. Enrollment in Medicaid
has increased in every State during that period. At the same time, many
States report a shortage of eligibility workers. It is our priority to
ensure that renewals of eligibility and transitions between coverage
programs occur in an orderly process that minimizes beneficiary burden
and promotes continuity of coverage and care.
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\7\ Under the Families First Coronavirus Response Act (FFCRA,
Pub. L. 116-127), States did not terminate enrollment for most
individuals who were enrolled in Medicaid as of or after March 18,
2020, as a condition of receiving a temporary increase in the
Federal Medical Assistance Percentage. The Consolidated
Appropriations Act, 2023 (CAA, 2023, Pub. L. 117-328), enacted on
December 29, 2022, ended this Medicaid continuous enrollment
condition on March 31, 2023, enabling States to begin the process of
initiating Medicaid eligibility reviews as early as February 1,
2023.
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As we considered the challenges faced by States, we sought comment
on reasonable implementation timelines for the provisions in our
proposed rule, which would allow States to implement these important
policies without negatively impacting the resumption of routine
eligibility and enrollment operations. Certain provisions designed to
improve the retention of eligible individuals could reduce the
likelihood of eligible individuals losing health coverage during
unwinding. However, we were also concerned that the work necessary to
immediately implement such provisions would divert needed resources
away from critical unwinding-related activities.
Recognizing that each State faces a unique set of challenges
related to unwinding, with differing needs and opportunities, we sought
comment on whether an effective date of 30 days following publication
would be appropriate when combined with a later date for compliance for
most provisions. We also sought comment on the timeframe that would be
most effective for compliance with each provision and whether the
compliance date should vary by provision.
In this final rule, we establish compliance dates that allow time
for States to fully comply with new requirements while balancing other
immediate priorities. Many of the provisions have compliance dates of
April 1, 2026, one has a compliance date of October 1, 2024, and
provisions that create State options generally take effect on the
effective date of this final rule. We encourage States to comply with
all new requirements as expeditiously as possible because they will
improve access to MSPs for eligible new applicants and improve
retention of eligible individuals who are already enrolled in an MSP,
while reducing administrative burden on States and individuals.
Finally, implementation of this final rule will complement other
new policies to improve access to coverage and affordability of
prescription drugs. Beginning January 1, 2024, section 11404 of the
Inflation Reduction Act expands eligibility for the full Medicare Part
D Low-Income Subsidy benefit. To the extent that this change increases
the number of people who apply for the Low-Income Subsidy and are
otherwise eligible for (but not yet enrolled in) the MSPs, provisions
in this final rule will facilitate access to the MSPs while reducing
administrative burdens. And to the extent this final rule improves
access to the MSPs, it will also automatically improve access to the
Low-Income Subsidy, as we describe later in this final rule. Based on
the evidence that Medicare prescription drug subsidies improve access
to treatment \8\ and overall access to health insurance improves health
outcomes,\9\ our proposals are likely to improve the health of older
adults and people with disabilities.
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\8\ Dusetzina, S. et al., ``Many Medicare Beneficiaries Do Not
Fill High-Price Specialty Drug Prescriptions,'' Health Affairs. 41:
no. 4 (April 2022): 487-496. <a href="https://www.healthaffairs.org/doi/epdf/10.1377/hlthaff.2021.01742">https://www.healthaffairs.org/doi/epdf/10.1377/hlthaff.2021.01742</a>.
\9\ Hoffman, Catherine, and Julia Paradise, ``Health Insurance
and Access to Health Care in the United States,'' Ann. N.Y. Acad.
Sci. 1136 (2008): 149-160. <a href="https://nyaspubs.onlinelibrary.wiley.com/doi/pdfdirect/10.1196/annals.1425.007">https://nyaspubs.onlinelibrary.wiley.com/doi/pdfdirect/10.1196/annals.1425.007</a>.
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II. Provisions of the Proposed Rule and Analysis of and Response to
Public Comments

A. Facilitating Medicaid Enrollment

1. Facilitate Enrollment Through Medicare Part D Low-Income Subsidy
``Leads'' Data (42 CFR 435.4, 435.601, 435.911, and 435.952)
Medicare Savings Programs and Part D Low- Income Subsidy
Background. Under mandatory eligibility groups that are collectively
referred to as MSPs, individuals with limited income and resources
qualify for Medicaid coverage of Medicare Part A and/or B premiums and,
often, cost-sharing. State Medicaid agencies receive applications and
adjudicate eligibility for full Medicaid and MSP coverage. Currently,
the MSP eligibility groups cover over 10 million low-income
individuals. There are three primary MSP eligibility groups: \10\ the
Qualified Medicare Beneficiary (QMB) group, through which Medicaid pays
all of an individual's Medicare Parts A and B premiums and assumes
liability for most associated Medicare cost-sharing charges for people
with income that does not exceed 100 percent of the FPL; the Specified
Low-Income Medicare Beneficiary (SLMB) group, through which Medicaid
pays the Part B premium for people with income that exceeds 100
percent, but is less than 120 percent, of the FPL; and the Qualifying
Individuals (QI) group, through which Medicaid pays Part B premiums for
people with income of at least 120 percent but less than 135 percent of
the FPL.\11\ Individuals also must meet corresponding resource criteria
to be eligible for an MSP. The income and resource requirements for
coverage under the MSPs, and the benefits to which eligible individuals
are entitled, are set forth at sections 1905(p)(1) and 1902(a)(10)(E)
of the Act. Among other things, section 1905(p) of the Act directs that
the income and resource methodologies applied by the Social Security
Administration (SSA) in determining supplemental security income (SSI)
eligibility per sections 1612 and 1613 of the Act be used to determine
financial eligibility for the MSPs, except that States may employ less
restrictive income and/or resource methodologies than those applied in
determining SSI eligibility under the authority of section 1902(r)(2)
of the Act.
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\10\ There is a separate and fourth MSP eligibility group
generally referred to as the ``Qualified Disabled Working
Individuals (QDWI) group,'' or QDWI group. As described in section
1902(a)(10)(E)(ii) of the Act, eligibility in the QDWI group is
limited to individuals whose incomes do not exceed 200 percent of
the FPL; whose resources do not exceed twice the relevant SSI
resource standard (that is, for a single individual or couple); and
who are eligible to enroll in Part A under section 1818A of the Act.
Section 1818A of the Act permits individuals who became entitled to
Part A on the basis of their receipt of Social Security disability
insurance (SSDI) and who subsequently lose SSDI after returning to
work (and, hence, entitlement to Part A) to enroll in Part A
contingent on paying the Part A premiums. The medical assistance
available to QDWIs is the coverage of the Part A premiums. The QDWI
group is not included in this proposal, because the income limits of
the QDWI group are significantly higher than LIS and there does not
exist the flexibility to disregard resources that are available for
the other MSPs.
\11\ Unlike a subset of individuals enrolled in the QMB and SLMB
groups, no individuals enrolled in the QI group are eligible for
other Medicaid program benefits.
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As discussed in the proposed rule at 87 FR 54763, the MSPs are
essential to the health and economic well-being of low-income Medicare
enrollees, helping to free up limited income for food, housing, and
other life necessities. Despite the importance of the MSPs, a 2017
study conducted for MACPAC estimated that only about half of eligible
individuals enrolled in Medicare were also enrolled in the MSPs.\12\
This means

[[Page 65232]]

that millions of Medicare enrollees living in poverty are paying over
10 percent of their income to cover Medicare premiums alone, despite
being eligible for Medicaid coverage for these costs. Complex MSP
enrollment processes contribute to this low participation
rate.13 14
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\12\ Caswell, Kyle J., and Timothy A. Waidmann, ``Medicare
Savings Program Enrollees and Eligible Non-Enrollees,'' The Urban
Institute, June 2017. <a href="https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf">https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf</a>.
\13\ Office of the Assistant Secretary for Planning and
Evaluation, ``Loss of Medicare-Medicaid Dual Eligible Status:
Frequency, Contributing Factors, and Implications,'' May 8, 2019.
<a href="https://aspe.hhs.gov/basic-report/loss-medicare-medicaid-dual-eligible-status-frequency-contributing-factors-and-implications">https://aspe.hhs.gov/basic-report/loss-medicare-medicaid-dual-eligible-status-frequency-contributing-factors-and-implications</a>.
\14\ Government Accountability Office, ``Medicare Savings
Programs: Implementation of Requirements Aimed at Increasing
Enrollment,'' September 2012. <a href="https://www.gao.gov/assets/gao-12-871.pdf">https://www.gao.gov/assets/gao-12-871.pdf</a>.
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The Medicare Improvements for Patients and Providers Act of 2008
(MIPPA) (Pub. L. 110-275, enacted July 15, 2008), aimed to improve low-
income benefit programs for Medicare beneficiaries. MIPPA included new
requirements for States to streamline enrollment of Medicare Part D
Low-Income Subsidy (LIS) program enrollees into the MSPs. This final
rule codifies provisions from MIPPA and builds upon its requirements to
further streamline MSP enrollment for LIS enrollees and address
persistent under enrollment in the MSPs.
The Medicare Part D LIS program, also sometimes referred to as
``Extra Help,'' is administered by SSA and pays Medicare Part D
prescription drug premiums and cost-sharing for over 13 million
individuals with low incomes. Most LIS enrollees are deemed eligible
for LIS by virtue of their enrollment in Medicaid. Others apply for the
benefit by completing an application and submitting it to SSA. Once
received, SSA uses the information provided on the LIS application to
determine LIS eligibility. Section 1860D-14(a)(3)(C) of the Act directs
that the income methodologies for LIS are the MSP income methodologies
described in section 1905(p)(1)(B) of the Act (that is, with very
narrow exceptions, the SSI income methodologies). Similarly, section
1860D-14(a)(3)(D) and (E) of the Act direct that the resource
methodologies for LIS are the MSP resource methodologies described in
section 1905(p)(1)(C) of the Act, which are also generally aligned with
the SSI resource methodologies, except that the cash value of life
insurance, which is typically countable under SSI resource
methodologies, is not counted as a resource for LIS. The SSA has also
adopted a few additional regulatory and sub-regulatory methodological
simplifications for the LIS program that differ from SSI rules, as
explained later in this section of the final rule.
The MSP and LIS programs both assist low-income individuals in
accessing the Medicare benefits to which they are entitled and, as
described previously in this final rule, generally use a common
methodology to determine income and resource eligibility. Current
regulations at 42 CFR 423.773(c) require that individuals enrolled in
MSPs be automatically enrolled in LIS. However, individuals who are
enrolled in LIS are not automatically enrolled in MSPs. Many people
enrolled in the LIS program are not enrolled in an MSP, despite likely
being eligible. As discussed in the proposed rule at 87 FR 54764, MIPPA
included several provisions to promote the enrollment of LIS applicants
into the MSPs.
In particular, section 113 of MIPPA requires SSA to transmit data
from LIS applications (``leads data'') to State Medicaid agencies, and
that the electronic transmission from SSA ``shall initiate'' an MSP
application. MIPPA also requires States to accept leads data and ``act
upon such data in the same manner and in accordance with the same
deadlines as if the data constituted'' an MSP application submitted by
the individual. As outlined under Sec. 435.912, States have 45 days to
make an MSP eligibility determination based on the LIS data. The date
of the MSP application is defined as the date of the individual's
application for LIS under section 1935(a) of the Act.
Despite these statutory requirements, not all States initiate an
MSP application upon receipt of leads data from SSA. Based on program
experience and comments submitted on the proposed rule, some States
have been unaware or unclear of the steps required to meaningfully use
the leads data to streamline eligibility and enrollment in the MSPs.
Our data reflects that currently over a million individuals enrolled in
full LIS are not enrolled in an MSP. Given near alignment of MSP and
full LIS eligibility criteria, most of these individuals are likely
eligible for an MSP eligibility group.
The January 28, 2021 Executive Order on Strengthening Medicaid and
the Affordable Care Act directs agencies to address policies and
practices that may present unnecessary barriers to individuals and
families attempting to access Medicaid coverage,\15\ the April 5, 2022
Executive Order on Continuing to Strengthen Americans' Access to
Affordable, Quality Health Coverage charges Federal agencies with
identifying ways to help more Americans enroll in quality health
coverage,\16\ and the December 13, 2021 Executive Order on Transforming
Federal Customer Experience and Service Delivery to Rebuild Trust in
Government supports streamlining State enrollment and renewal processes
and removing barriers to ensure eligible individuals are automatically
enrolled in and retain access to critical benefit programs.\17\ As
such, we have evaluated CMS's regulatory authority to reduce barriers
to enrollment of eligible individuals into the MSPs. Under the
authority in section 1902(a)(4) of the Act to specify ``methods of
administration'' that the Secretary finds to be ``necessary for the
proper administration'' of State plans, we proposed several regulatory
changes to promote efficient enrollment in the MSPs by maximizing
States' use of LIS leads data. At 87 FR 54764, we explained that we
anticipated these proposals would also have a positive impact on health
equity by helping to provide more low-income individuals with access to
additional health coverage consistent with the January 20, 2021
Executive Order.\18\
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\15\ <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/28/executive-order-on-strengthening-medicaid-and-the-affordable-care-act/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/28/executive-order-on-strengthening-medicaid-and-the-affordable-care-act/</a>.
\16\ <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2022/04/05/executive-order-on-continuing-to-strengthen-americans-access-to-affordable-quality-health-coverage/">https://www.whitehouse.gov/briefing-room/presidential-actions/2022/04/05/executive-order-on-continuing-to-strengthen-americans-access-to-affordable-quality-health-coverage/</a>.
\17\ <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/12/13/executive-order-on-transforming-federal-customer-experience-and-service-delivery-to-rebuild-trust-in-government/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/12/13/executive-order-on-transforming-federal-customer-experience-and-service-delivery-to-rebuild-trust-in-government/</a>.
\18\ <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/</a>.
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Accepting LIS leads data as an MSP application. As discussed in the
proposed rule at 87 FR 54764, SSA must transmit the LIS leads data to
States, and States must use that data to initiate an application for
the MSPs. CMS has reinforced this requirement multiple times.\19\
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\19\ See February 18, 2010 State Medicaid Director Letter (SMDL
#10-003), ``Medicare Improvements for Patients and Providers Act of
2008 (MIPPA),'' explaining how to treat leads data as an application
for MSPs. <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf</a>. We reiterated this 2010 guidance in 2020 in
Chapter 1, section 1.6.2 of the Manual for the State Payment of
Medicare Premiums, <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>, and in the November 1, 2021 Center
for Medicaid and CHIP Services Informational Bulletin,
``Opportunities to Increase Enrollment in Medicare Savings
Programs.'' <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/cib11012021.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/cib11012021.pdf</a>.
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We proposed to codify in regulation the statutory requirements for
States to

[[Page 65233]]

maximize the use of leads data to establish eligibility for Medicaid
and the MSPs. At 87 FR 54765, we foresaw that codifying these
requirements would lead to more eligible individuals enrolling in MSPs
because it was our understanding that some States may have been unaware
or unclear of the steps required to meaningfully use the leads data to
streamline eligibility and enrollment in the MSPs.
Currently, all States receive leads data from SSA each business
day. Per section 113 of MIPPA, States must accept, via secure
electronic transfer, the SSA leads data and process that information to
initiate an MSP application. However, as discussed at 87 FR 54765, we
are aware that several States do not use the leads data to begin the
application process. We proposed to add a definition of LIS leads data
at Sec. 435.4 and a new paragraph (e) to Sec. 435.911 of the
regulations to clearly delineate the steps States must take upon
receipt of leads data from SSA. We proposed to define LIS leads data to
mean data from an individual's application for low-income subsidies
under section 1860D-14 of the Act that the SSA electronically transmits
to the appropriate State Medicaid agency as described in section
1144(c)(1) of the Act. We proposed at Sec. 435.911(e)(1) to require
States to accept, via secure electronic interface, the SSA LIS leads
data. We proposed paragraph (e)(2) to require that States treat receipt
of the leads data as an application for Medicaid and promptly and
without undue delay, consistent with the timeliness standards at Sec.
435.912, determine MSP eligibility without requiring submission of a
separate application.
We proposed paragraph (e)(4) to prevent States from requesting that
individuals attest or otherwise provide documentation to establish
information contained in leads data, which SSA has already used for the
LIS eligibility determination. We noted that a State is not in
compliance with the statutory requirement in section 1935(a)(4) of the
Act to initiate an application based on leads data or with the proposed
regulation if it requires the individual to file a new application for
MSP, since the leads data already provides much of the information that
would otherwise be requested on an application.
Further, because the LIS leads data that is transferred to State
agencies has just been used by the SSA for the LIS determination, State
verification of this data prior to adjudicating eligibility is
duplicative and inefficient. As such, under the Secretary's authority
under section 1902(a)(4) of the Act (relating to establishment of such
methods of administration as the Secretary determines ``necessary for
proper and efficient administration'' of the Medicaid program) and
section 1902(a)(19) of the Act (relating to simplicity of
administration and the best interests of recipients), we proposed at
Sec. 435.911(e)(5) that States be required to accept information that
is provided through the leads data without further verification, with
certain exceptions, as described below.
However, at 87 FR 54765, we recognized that State Medicaid agencies
generally will need to obtain additional information beyond what is
provided by the SSA that is necessary to determine eligibility, as some
differences remain in income and resource counting methodologies
between the LIS and MSPs, as described in more detail in the proposed
rule. In addition, as discussed at 87 FR 54765 through 54766, the leads
data transmitted to the State does not include information on an
individual's citizenship or immigration status, and therefore, States
will need to verify their status. In accordance with Sec. 435.406(a)
and section 1137(d) of the Act, individuals must make a declaration of
U.S. citizenship or satisfactory immigration status (subject to certain
verification rules at Sec. Sec. 435.956 and 435.407 and exemptions for
Medicare beneficiaries at Sec. 435.406(a)(1)(iii)(B)).
As such, we proposed at paragraph (e)(3) of Sec. 435.911 that
States must obtain additional information needed to make a
determination of eligibility for MSPs. We also recommended that when
States request additional information from individuals, they include
information on how to contact the local State Health Insurance
Assistance Program (SHIP) for assistance.
Consistent with existing regulations at Sec. Sec. 435.907(e) and
435.952(c), we proposed at paragraph (e)(4) of Sec. 435.911 that
States may not request that individuals attest or otherwise provide
documentation to establish information that SSA has already used for
the LIS eligibility determination.
Therefore, in instances in which the leads data would not support a
determination of eligibility for MSPs, we proposed at Sec.
435.911(e)(7) to require that States use the information provided by
the applicant to SSA through the LIS application process and separately
verify the individual's eligibility for Medicaid in accordance with the
State's verification policies. Specifically, under proposed Sec.
435.911(e)(7), the State would be required to: (1) determine whether
additional information is needed to make a determination of eligibility
for an MSP; (2) if additional information is needed, notify the
individual that they may be eligible for assistance with their Medicare
premium and/or cost-sharing charges, but that additional information is
needed for the agency to make a determination of such eligibility; (3)
provide the individual with a minimum of 30 days to furnish any
information needed by the agency to determine MSP eligibility; and (4)
verify the individual's eligibility for an MSP in accordance with the
State's verification plan developed in accordance with Sec.
435.945(j). We noted that, in the case of an applicant who has attested
to income or assets over the applicable income or resource standard,
States could, but would not be required to, request additional
information from the individual to confirm ineligibility for coverage.
Under our proposal, States would continue to be permitted to
request from the individual information that is necessary to make an
MSP eligibility determination if such information is missing from the
leads data and cannot be obtained from other third-party sources
consistent with current regulations, and as clarified in our proposed
revisions to Sec. 435.952(c). Similarly, States may not reach out to
individuals to request information already provided through leads data
unless the State has current and reliable information that is not
reasonably compatible \20\ with the leads data. We anticipate such
circumstances with respect to financial eligibility would be rare since
SSA has already used the leads data for the LIS determination just
prior to State use, employing many of the same sources for financial
eligibility data relied upon by States.
---------------------------------------------------------------------------

\20\ Under Sec. 435.952(c)(1), income information obtained
through an electronic data match shall be considered ``reasonably
compatible'' with income information provided by or on behalf of an
individual if both are either above or at or below the applicable
income standard or other relevant income thresholds.
---------------------------------------------------------------------------

Finally, individuals eligible for the LIS program may be eligible
for full Medicaid benefits, in addition to the assistance with Medicare
premiums and cost-sharing available under the MSPs. Under the current
regulations at Sec. 435.911, for individuals who submit the single
streamlined application for Medicaid on the basis of MAGI, but who may
be eligible on a basis other than MAGI, States are required to collect
any additional information that is needed to make a determination on a
non-MAGI basis, and to make such determination if the individual
provides the needed information. Consistent with sections 1902(a)(4)
and (a)(19) of the Act, we proposed a similar requirement with

[[Page 65234]]

respect to individuals whose applications were initiated by receipt of
LIS leads data. Specifically, we proposed new regulatory text at Sec.
435.911(e)(6) to require States to obtain such additional information
as may be needed to determine whether individuals whose MSP
applications were initiated based on receipt of LIS leads data are
eligible for Medicaid in any other eligibility groups (that is, other
than the MSPs), including other non-MAGI groups and MAGI-based groups
as well. This proposal aimed to codify a pathway for efficient
enrollment of LIS enrollees into both the appropriate MSP eligibility
group, as well as into a full-benefit group if eligible without
imposing undue administrative burdens on States. We anticipated this
would also promote program integrity by ensuring enrollment in the
appropriate eligibility group. We noted that individuals can be
eligible for both an MSP and an eligibility group that confers full
Medicaid benefits. Therefore, the requirement under proposed Sec.
435.911(e)(6) was in addition to the requirement to determine the
individual's eligibility for an MSP.
We received many comments on our proposals to streamline MSP
determinations using LIS leads data, and our responses follow.
Comment: Many commenters applauded CMS efforts to streamline MSP
determinations using LIS leads data with this new rule. They noted that
large numbers of eligible older adults and individuals with
disabilities are missing out on the vital financial and health benefits
the MSPs provide and cited burdensome paperwork requirements as a key
driver of persistent under-enrollment in these programs for individuals
who are eligible for them. They pointed out that, since 2010, Federal
statute (MIPPA) has required States to leverage leads data to
facilitate MSP enrollment for individuals enrolled in the LIS program,
and asserted that CMS's proposal to codify and build upon these
requirements is needed to ensure States fully leverage leads data for
MSP determinations and to promote greater uniformity among States in
application processes and MSP participation rates for individuals
enrolled in LIS. MACPAC generally supported these provisions, noting
that they would promote MSP enrollment by simplifying eligibility and
enrollment processes and would improve health equity by increasing
access to care for additional low-income individuals with Medicare.
Response: We thank the commenters for their support. As we stated
above, the MSPs are essential to the health and economic well-being of
those enrolled, promoting access to care and helping free up
individuals' limited income for food, housing, and other life
necessities. We remain committed to increasing participation in these
vital programs and foresee that simplifying enrollment processes would
help hundreds of thousands of eligible individuals access these
critical benefits.
Comment: Some commenters expressed concerns that proposals at new
Sec. 435.911(e) to facilitate MSP enrollment through leads data would
be burdensome and costly for States. For example, while MACPAC
generally supported these provisions, it noted that they would likely
increase costs to States and add to their administrative burden. Other
commenters relayed concerns with the quality and adequacy of the leads
data which they asserted would require additional manual work and
system upgrades for States. For that reason, the commenters requested
that CMS work with SSA to improve leads data before adopting this
proposal. For example, some commenters maintained that because leads
data lacks all information necessary for MSP determinations, States
must follow up to obtain missing information. In addition, a commenter
incorrectly contended that leads income and resource data is unusable
because the commenter believed that information appears as a lump sum
total, without a breakdown of sources and amounts. A few commenters
noted that leads data omits citizenship and immigration status
information and requested that CMS and SSA explore adding it in the
future.
Response: We appreciate the commenters' perspectives and
acknowledge that complying with our proposals to streamline MSP
enrollment for LIS recipients could require some States to update their
policy, operations, and/or systems--although we project reductions in
administrative costs over the long term. We also recognize that
increases in MSP enrollment as a result of our proposal could raise
costs for States. However, Federal statute (MIPPA) has required States
to use leads data to initiate an MSP application since January 1, 2010.
Further, as we detailed in the proposed rule at 87 FR 54765,
misalignments between the LIS and MSP programs may mean that leads data
omits certain data needed to determine MSP eligibility. However, under
Sec. 435.911(c)(2), States are already required to obtain additional
information for applicants, including LIS applicants whose data has
been transferred to the State through the leads data, when current
information is insufficient to make a Medicaid eligibility
determination.
With respect to the commenter's contention that LIS leads data only
contains undifferentiated total amounts of the individual's income and
resources, this is incorrect. We clarify that an individual's leads
data record includes a breakdown of income and resources, by source and
amounts.\21\ In response to commenters' questions about expanding leads
data to include citizenship information, we plan to explore with SSA
the feasibility of adding this information in the future, as we foresee
it could streamline processes for citizenship-related eligibility under
Sec. 435.406 and reduce burden on States and individuals. With respect
to the request to add immigration status information to the leads data,
we plan to analyze further the feasibility and benefits of such an
expansion to streamline eligibility determinations before exploring
this step with SSA. In addition, as we reiterate in response to other
comments below, if the State already has previously verified this
information and it is included in the case record for the individual,
the State must not request this information from the individual again
in accordance with Sec. 435.956(a)(4)(ii).
---------------------------------------------------------------------------

\21\ See LIS record. <a href="https://www.ssa.gov/dataexchange/documents/LIS%20record.pdf">https://www.ssa.gov/dataexchange/documents/LIS%20record.pdf</a>.
---------------------------------------------------------------------------

Overall, States' comments revealed States' lack of familiarity with
the leads data. We also acknowledge that States are engaged in
unwinding from the Medicaid continuous enrollment condition, and our
proposal adds some new requirements for States, despite the
longstanding MIPPA requirements. Therefore, we will provide States more
time to comply with these provisions after this final rule's effective
date, as explained below. Prior to the compliance date, we plan to
focus on providing technical assistance and guidance to States to
assist them in achieving full compliance with these provisions.
Comment: While supportive of this codification, a number of
commenters urged CMS to pursue concerted monitoring and oversight of
States' compliance with their obligations under MIPPA. These commenters
reported widespread partial or full non-compliance with leads data
requirements by States, including examples of States that lack the
system capacity to leverage leads data and States that automatically
send individuals identified through LIS leads data an MSP application
or instructions on how to complete the process.

[[Page 65235]]

Response: We appreciate the commenters' support for codifying in
regulation the MIPPA requirements for how States must use LIS leads
data for determining MSP eligibility and agree with their likely
benefits, including clarity and accountability for States. We also
agree with the commenters on the importance of effective oversight and
monitoring. We intend to implement a robust oversight and monitoring
approach, and we are currently exploring options on how best to ensure
the LIS leads data provisions are effectively implemented.
Comment: A commenter maintained that codifying MIPPA is
unnecessary, stating that States currently use LIS leads data as
required. Some commenters also noted that these proposals were already
required by MIPPA.
Response: We appreciate the commenters' input but disagree that
codifying the MIPPA requirements is unnecessary. As described in the
proposed rule (87 FR 54764) and reiterated by commenters and noted
previously in this final rule, many States have only partially
implemented these requirements, and some have yet to meaningfully do so
at all. We believe that codifying the requirements for States will
clarify State responsibilities under MIPPA and lead to more States
using leads data as required. However, while we are codifying
provisions already required by law, we disagree that all of our
proposals are already required by MIPPA. For example, in our 2010
guidance on implementing MIPPA, State Medicaid Director Letter, #10-
003, ``Medicare Improvements for Patients and Providers Act of 2008''
(the 2010 MIPPA SMDL),\22\ we advised that States are permitted to
treat leads as verified for the purposes of MSP determinations. Under
our proposal, we would newly require States to accept leads data
without further verification unless the State has other information
that is not reasonably compatible with the leads data.
---------------------------------------------------------------------------

\22\ <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf</a>.
---------------------------------------------------------------------------

Comment: Several commenters supported proposals in Sec.
435.911(e)(4) on accepting leads data as verified if it supports an MSP
eligibility determination and Sec. 435.911(e)(5) on refraining from
requesting data already in leads data. Commenters noted that these
proposals reduce duplication, reduce barriers to enrollment, and
streamline the MSP determination process. A commenter stated that
requiring States to treat leads data as verified would boost the share
of individuals enrolled in LIS who would also get enrolled into MSPs.
Response: We thank the commenters for their support about accepting
leads data as verified and agree that these provisions reduce
duplication and barriers to enrollment.
Comment: A few commenters noted their opposition to our proposal to
require States to accept leads data as verified without requesting
further information from the individual or separate verification by the
State. A commenter expressed program integrity concerns, asserting that
LIS data is less reliable than other State sources of information.
Another commenter explained that its State verification procedures
require individuals to produce documentation when State information
sources differ from the information the applicant has supplied. The
commenter noted that these requirements are stricter than SSA's LIS
program procedures which allow SSA to accept an individual's verbal
explanation of a discrepancy between income and resources if it is
reasonable. A commenter said that CMS's proposal is inconsistent,
forcing States to accept leads data as verified if it supports an MSP
eligibility determination, but not allowing States to accept leads data
as verified if it does not support an MSP eligibility determination.
Response: As noted in the proposed rule at 87 FR 54765, we maintain
that accepting leads data as verified and not allowing States to
request that the applicant provide information already sent to the
State by SSA limits duplication and streamlines the MSP determination
process. Additionally, we disagree with the commenters' assertion that
the LIS information is inherently less reliable than other State
sources of information. As we noted in the proposed rule at 87 FR
54766, States and SSA are pulling electronic data from many of the same
sources of information. Additionally, as explained previously in this
final rule, if States have other information not reasonably compatible
with leads data, they must request additional information from the
individual before enrollment.
With respect to the commenter's concerns about the differing
requirements when leads data would lead to a denial, we stated in the
proposed rule (87 FR 54765) that applying a different verification
policy to the use of LIS leads data that supports an MSP eligibility
determination versus the use of leads data that would result in an MSP
denial is in keeping with provisions of the Computer Matching and
Privacy Protection Act (CMPPA, Pub. L. 100-503) at 5 U.S.C. 522a(p)(1).
The CMPPA requires States to take actions to independently verify
information that SSA provides before the State may terminate, suspend,
reduce, deny, or take other adverse action against an individual.
Comment: A few commenters provided input about the processing of
MSP applications under proposed Sec. 435.911(e). A commenter asserted
the proposal requires States to process MSP applications 45 days from
the date SSA receives the LIS application and requested a longer period
to align its LIS and MSP processes to comply. A few commenters
questioned what State action is appropriate (for example, a denial of
eligibility) if an individual does not return information requested by
the State that is absent from the leads data and needed to determine
eligibility for the MSPs.
Response: As we discussed in the 2010 MIPPA SMDL, States must treat
the date the LIS application is filed with SSA as the date of
application for purposes of establishing the effective date of
eligibility for MSP benefits. However, States have flexibility
regarding the calculation of the 45-day processing timeline under Sec.
435.912(c)(3). States may either use the date that the State receives
the LIS leads data from SSA or the date of the LIS application as the
start of the calculation of the 45-day processing timeline under Sec.
435.912(c)(3). This policy allows additional time to make this MSP
determination based on the LIS leads data, while ensuring MSP coverage
is not delayed for eligible individuals. Additionally, we clarify that
for MSP applications based on leads data, if an individual fails to
comply with a request for information within the requisite time, a
State would issue a notice of denial consistent with 42 CFR 431.210 and
435.917(b).
Comment: Some commenters submitted suggestions regarding the
proposed new Sec. 435.911(e)(3) that requires States to request
additional information that is necessary for the MSP determination.
Commenters suggested that CMS require States to collect additional
relevant information through a pre-populated form that contains LIS
leads data. These commenters maintained that individuals may be more
likely to understand and timely respond to a prepopulated form.
Further, a commenter stated that while States would generally need to
obtain citizenship/immigration status, which is not in leads data, it
is likely that many LIS applicants have been enrolled in Medicaid in
the past. The commenter recommended that CMS re-emphasize

[[Page 65236]]

that Sec. 435.956(a)(4) requires States to maintain a record of having
verified citizenship or immigration status and not re-verify or require
MSP applicants to re-verify their status.
Response: We agree that collecting missing information through a
pre-populated form may help individuals respond timelier to States'
request for additional information. As such, we encourage States to use
pre-populated forms as a best practice. At this time, though, we
decline to make this a requirement for States because we are interested
in providing States some flexibility in carrying out this particular
requirement. However, we will consider this recommendation in the
future based on program experience. In addition, we agree that Sec.
435.956(a)(4) requires States to maintain a record of previously
verified citizenship or immigration status, in accordance with the
State's records retention policy in accordance with Sec. 431.17(c).
Further, States may not re-verify or require MSP applicants to re-
verify citizenship at renewal or subsequent application when such
verification is documented in the individual's case record unless the
individual has reported a change in citizenship, the agency has
received information indicating a potential change, and the individual
is not exempt from the requirement to provide documentation of
citizenship under Sec. 435.406(a)(1)(iii). We note that consistent
with current policy, States may refrain from verifying immigration
status for individuals whose particular status is not subject to change
if verification of such status is documented in the individual's case
record, the individual has not reported a change, and the agency has
not received information indicating a potential change.\23\
---------------------------------------------------------------------------

\23\ See final rule titled ``Medicaid and Children's Health
Insurance Programs: Eligibility Notices, Fair Hearing and Appeal
Processes for Medicaid and Other Provisions Related to Eligibility
and Enrollment for Medicaid and CHIP'' published in the November 30,
2016 Federal Register (81 FR 86382, 86428).
---------------------------------------------------------------------------

Comment: A few commenters shared feedback on CMS's recommendation
that States include information on how to contact the local SHIP when
asking individuals for more information to make an MSP determination.
Some commenters supported this recommendation, including a commenter
that recommended that CMS make it mandatory. These commenters pointed
out that SHIPs may be uniquely equipped to provide individuals one-on-
one help to explain State communications and how to satisfy the State
request for additional information. Conversely, a commenter shared
concerns that SHIPs may lack access to Medicaid systems or have
adequate resources to assist individuals. Another commenter opposed
this recommendation, asserting that SHIPs are an inappropriate resource
because they lack authorization to verify applicant information.
Response: We thank the commenters for their input regarding our
recommendation for States to provide contact information for SHIPs when
sending information requests for MSP determinations. Our program
experience and input from interested parties have indicated that
individuals may struggle to understand State communications and
complete documentation requests without personalized assistance from
eligibility workers or counselors, such as SHIPs.\24\ As such, we agree
with the commenters that SHIPs may be a valuable resource to help
individuals comprehend and complete requests for information. We
acknowledge that SHIPs may lack the authority to verify data or check
Medicaid systems but clarify that States would remain responsible for
completing the verification processes. Further, we recognize that
State-specific variables, for example, the capacity and willingness of
the region's SHIPs to provide this assistance, may affect whether a
State Medicaid agency pursues our recommendation to include SHIPs as a
resource in their requests for information from MSP applicants. Given
all these considerations, we continue to recommend--rather than
require--that States include contact information for SHIPs in their
requests for additional information.
---------------------------------------------------------------------------

\24\ See for example, CMS Office of Burden Reduction & Health
Informatics, ``Navigating the Medicare Savings Program (MSP)
Eligibility Experience,'' April 2022. <a href="https://www.cms.gov/files/document/navigating-medicare-savings-program-msp-eligibility-experience-journey-map.pdf">https://www.cms.gov/files/document/navigating-medicare-savings-program-msp-eligibility-experience-journey-map.pdf</a>.
---------------------------------------------------------------------------

Comment: Many commenters supported the proposal for States to
screen MSP applications from leads data for full Medicaid benefits,
indicating it would accelerate and streamline review of Medicaid
eligibility for States and lower-income older adults and persons with
disabilities who may not be able to separately navigate the Medicaid
process. Some commenters further noted that States must screen
individuals who apply for MAGI categories upon all bases and that
failing to apply a similar ``no wrong door'' approach to MSP
applications based on LIS data would disadvantage individuals who apply
through the LIS application as compared to individuals who apply for
MAGI-based Medicaid. These commenters also stated that adopting
different screening standards across the MAGI and non-MAGI groups risks
potential confusion and duplicative administrative work for State
Medicaid agencies.
Many of these same commenters, while supporting this proposal on
balance, also expressed concerns that State implementation of the
requirement to screen on all bases could undermine the streamlined
application and enrollment processes for the MSPs that MIPPA and CMS'
proposed changes aim to achieve. Some commenters indicated that
requiring a full Medicaid screen could slow down the MSP determination
process if CMS does not require States to extend the streamlined income
and resource verification rules for the MSPs to non-MAGI groups. They
explained that States with different verification rules for other non-
MAGI categories must routinely request additional documentation from
MSP applicants and might wait to process the MSP application until the
applicant provides additional documentation needed for the full
Medicaid determination. For these reasons, some commenters requested
that CMS clarify that the full Medicaid screen is separate from the MSP
enrollment process and that States must not delay the MSP determination
and approval for benefits to obtain information necessary for the full
Medicaid determination. Similarly, some commenters shared concerns that
State communications that combine requests for information missing from
leads data and requests for information and disclosures about estate
recovery needed for the full Medicaid determination could overwhelm and
confuse applicants or give a false impression that estate recovery
applies to the MSPs, thus deterring them from completing the MSP
application. A commenter suggested that CMS work with States to test
different approaches with consumers and develop best practices and
options to seek additional information for full Medicaid, making State
practices subject to our review. Another commenter suggested that CMS
prohibit States from using the same notice to communicate a denial of
full Medicaid coverage and a request for information for the MSPs,
contending that individuals who receive combined notices are less
likely to read and fulfill requests for additional information for the
MSPs. A commenter recommended that SSA provide more information related
to full Medicaid on the LIS application, including the required rights
and responsibilities for the

[[Page 65237]]

Medicaid program. A few commenters suggested that our proposal would
require States to accept leads data as verified for all non-MAGI
eligibility groups and requested that CMS explicitly acknowledge this
requirement.
Some commenters expressed opposition to the proposal at Sec.
435.911(e)(6) to require States to screen individuals who apply for
MSPs through LIS leads data for Medicaid on all bases. They cited some
of the same issues identified by those who expressed support, including
that because the LIS application does not request the relevant data for
full Medicaid determinations or provide rights and responsibilities and
required disclosures (for example, an explanation that estate recovery
applies to full Medicaid benefits), States would need to follow up with
individuals, slowing down and complicating what is intended to be a
streamlined process for MSP enrollment. A commenter noted that
individuals may not realize that estate recovery applies to full
Medicaid benefits since the LIS application does not mention full
Medicaid benefits or its implications. A few commenters suggested that
screening MSP applications based on leads data for full Medicaid
eligibility would in effect require the completion of a full Medicaid
application. Another commenter requested that CMS more clearly
delineate State requirements to screen MSP applications based on leads
data upon all bases. Another commenter requested that CMS clarify the
proposed Sec. 435.911(e), contending that the regulation text is
disjointed and disorganized, making it unclear what is required for the
MSPs versus full Medicaid groups. Similarly, the same commenter stated
that CMS is inconsistent in how we refer to the Medicare Savings
Programs, sometimes referring to them as the Medicare Savings Programs
and other times by referencing section 1905(a)(10)(E) of the Act, for
example.
Finally, some commenters, including those opposing and supporting
the proposal, shared concerns that screening individuals who apply for
the MSPs based on leads data on all bases would require significant
policy changes, eligibility systems changes, and/or manual effort for
which they would need additional implementation time.
Response: We thank the commenters for feedback about our proposal
to require individuals who apply for MSPs through LIS leads data be
screened for Medicaid on all bases. In the proposed rule (87 FR 54766),
we indicated that our proposal was consistent with section 1902(a)(4)
and (a)(19) of the Act, as it would facilitate the efficient enrollment
of LIS enrollees into both the appropriate MSP eligibility group and
into a full-benefit group if eligible without imposing undue
administrative burden on States. We also noted that the requirement to
screen MSP applicants based on leads data was similar to the existing
requirement for States to screen individuals who apply for MAGI-based
Medicaid on all bases. We still share the view that requiring States to
assess such applicants for full Medicaid would facilitate their access
to full-scope Medicaid coverage. However, we appreciate commenters'
concerns that certain ways of implementing our proposed requirement
could potentially undermine the streamlined processes designed to
facilitate MSP enrollment using leads data under MIPPA and this final
rule.
As commenters cited, the LIS application does not inform
individuals that States will screen them on all bases or provide the
rights and responsibilities, such as disclosures about estate recovery,
that we require for Medicaid applications. Rather, the current LIS
application obtains the individual's consent to share their LIS
information with the State ``to start the application process for the
Medicare Savings Programs.'' \25\ While it may be possible to add
information about full Medicaid eligibility determinations to the LIS
application, as a commenter suggested, we are concerned this could make
it less likely that individuals complete the LIS application and agree
to share their data with the State for an MSP determination.
---------------------------------------------------------------------------

\25\ See cover letter, question number 15, and signatures pages
in the LIS application. <a href="https://www.ssa.gov/forms/ssa-1020-ocr-sm-inst.pdf">https://www.ssa.gov/forms/ssa-1020-ocr-sm-inst.pdf</a>.
---------------------------------------------------------------------------

Under proposed Sec. 435.911(e)(6), States would be required to
both promptly complete a determination of eligibility for the MSPs and
collect additional information needed to determine whether the
individual is eligible for full Medicaid benefits. However, we
recognize, after reviewing the comments, that the proposed rule was not
clear about all of the steps States would need to make to determine
eligibility for full Medicaid benefits, or all of the information they
would need to make a determination for, and enroll an individual in,
full Medicaid benefits. Specifically, in addition to obtaining
additional information regarding eligibility criteria needed by the
State for a full Medicaid determination, States would need to obtain
the individual's consent to enroll in full Medicaid benefits, which
would also necessitate the State informing an individual who applied
for the MSPs through the LIS application about the additional benefits
that may be available, the rights and responsibilities associated with
enrolling for full benefits, and the potential for estate recovery,
which under section 1917(b)(1)(B) of the Act States must employ for
Medicaid coverage of long-term care services and supports and related
services and can employ for coverage of other Medicaid items and
services, not including premium and cost-sharing assistance under the
MSPs.
States may also need to reach out to individuals who are applying
for the MSPs through the LIS application to obtain additional
information that is needed for the MSP determination. We share
commenters' concerns that a single communication that requests all of
the information needed for the MSP determination and all of the
information needed to determine full-benefit eligibility could
overwhelm and confuse applicants and reduce their willingness and
capacity to complete the steps required for States to make the MSP
determination. Further, we agree with commenters that the full-benefit
determination should not delay the MSP determination.
After considering all of these factors raised by the commenters, we
are revising the proposed regulation at Sec. 435.911(e)(6)(i) and
(ii), redesignated at Sec. 435.911(e)(9)(i) and (ii), to specify that
the State must provide individuals effectively applying for the MSPs
through an LIS application--in addition to and separate from any
requests for additional information necessary for the determination of
MSP eligibility--(1) information about the availability of Medicaid
benefits on other bases, including the scope of such benefits and
responsibilities of the individual applying for such benefits; and (2)
an opportunity to furnish such additional information as may be needed
to determine whether the individual is eligible for such additional
Medicaid benefits. Under this final rule, a State may request CMS
approval of another approach to ensuring that applicants have the
opportunity to receive determinations on whether they are eligible for
Medicaid benefits other than through an MSP.
This change to our proposal in response to comments would avoid
delays in MSP enrollment and avoid drawbacks associated with modifying
the LIS application itself, while still facilitating enrollment in full
Medicaid coverage if an individual is eligible. To provide States
sufficient time to make a

[[Page 65238]]

full Medicaid determination for individuals applying for the MSPs
through the LIS application, for purposes of timeliness standards under
Sec. 435.912, the process of obtaining the additional information
needed for the full Medicaid determination would begin a new clock for
determining timeliness, since the initial transfer of leads data only
includes the applicant's authorization to initiate the application
process for the MSPs and not full Medicaid.
We encourage (but do not require) States to treat leads data as
verified for the full-benefit Medicaid eligibility determination.
However, in all cases, the State would still need to describe rights
and responsibilities and applicable estate recovery rules, obtain a
signature for enrollment, and seek additional information necessary for
full Medicaid determinations. Further, in light of the commenter's
suggestion to clarify the regulation text, we are revising the
regulation text to clarify requirements for States and to use
consistent terminology for the MSPs.
Comment: Some commenters suggested that CMS provide technical
assistance and education to facilitate enrollment through Medicare Part
D LIS leads data. A commenter encouraged CMS to provide technical
assistance on issues related to leads data and engage with SSA to
ensure data feeds to States are working properly. In particular, a
commenter noted that its State began using LIS leads data in March 2021
and requested that SSA and CMS support the State in reconstructing LIS
leads data before March 2021 to identify individuals contained in the
leads data and to assess them for past eligibility for the MSPs.
Another commenter requested that CMS do more to promote alignment
between LIS and MSP programs such as by creating State plan amendment
(SPA) templates and providing more technical assistance to States to
illustrate how to align these methodologies. A commenter also urged CMS
to provide States technical assistance on getting attestations over the
phone and to encourage States to use telephonic attestations, instead
of paper forms, to minimize situations where individuals are denied
eligibility for failing to return paperwork. Another commenter urged
CMS to provide technical assistance to Medicaid directors and their
staff by holding a call or series of calls to address concerns about
fraud in self-attestations. A commenter also recommended that CMS allow
individuals to submit information through multiple modalities during
the application process to support equity and inclusion. Another
commenter recommended that CMS require States to use clear and simple
language in the State's notice of the eligibility determination.
Finally, a commenter noted that individuals may have had negative
experiences with applying for benefits in the past and urged CMS to
educate current and potential enrollees about the new, streamlined
processes using outreach that is easily understood and accessible.
Response: To the extent that States need support in complying with
new requirements under Sec. 435.911(e), or are currently experiencing
difficulties understanding, using, or manipulating the leads data, we
are available to assist. In response to commenters' concerns, we can
also facilitate State discussions with SSA should States require
technical assistance to access the leads data files transferred from
SSA. (State Medicaid officials can reach us through their dedicated CMS
points of contact.) In addition, while SSA does not generally store LIS
leads data for past years, we are available to answer questions from
States and to assist them when feasible with their data needs. We also
are happy to provide technical assistance and best practices to States
on using telephonic attestations instead of paper forms and to address
concerns about fraud regarding self-attestation. We note that SSA uses
telephonic attestations, so Medicare enrollees may be familiar with
this procedure already. We appreciate the recommendations on promoting
alignment between LIS and MSP programs and will consider these
recommendations, including SPA checklists, for future guidance to
States. We also appreciate the recommendation about format flexibility
during the application process and note that States must already allow
individuals to submit information through multiple modalities under
Sec. 435.907(a), as explained in the proposed rule (87 FR 54780).
Further, in accordance with Sec. 435.917, State eligibility
determination notices must be written in plain language and be
accessible to individuals with limited English proficiency and
disabilities, among other requirements. Finally, we agree with the
importance of clear, accessible education and outreach regarding new
streamlined MSP provisions and will explore ways to support States with
their MSP education and outreach efforts.
Comment: A number of commenters provided feedback regarding the
implementation timeline for the proposed provisions to streamline MSP
determinations using leads data in new Sec. 435.911(e). Several of
these commenters supported a 30-day implementation timeline, noting
that the proposed provisions implement a statutory requirement to use
leads data to initiate an MSP application that was enacted over 13
years ago. In contrast, some commenters, both supporting and opposing
the leads data proposals, urged CMS to provide significant additional
time to implement the proposed requirements in new Sec. 435.911(e)
regarding leads data, since most of them constitute new substantive
requirements established through this rulemaking under the authority in
the leads data provisions under section 113 of MIPPA.
Response: The general requirement to use leads data to trigger an
MSP application has been in Federal statute for over 13 years, and its
requirements have been interpreted in guidance issued by CMS in
2010,\26\ 2020,\27\ and 2021.\28\ As such, the requirements for States
to receive from SSA the LIS leads data and treat it as an MSP
application as interpreted in existing guidance continue to apply as
they have been applied under that guidance. However, new Sec.
435.911(e) contains numerous new substantive regulatory requirements,
and based on commenters' feedback on this proposed rule we foresee that
some States will require time to come into compliance with these
provisions. Therefore, in response to these comments, we are in this
final rule establishing a compliance date for the requirements in new
Sec. 435.911(e) of April 1, 2026. Prior to the compliance date, we
plan to provide technical assistance and guidance to States as they
come into compliance with the new rules.
---------------------------------------------------------------------------

\26\ The 2010 MIPPA SMDL. <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/smd10003.pdf</a>.
\27\ The Manual for the State Payment of Medicare Premiums,
chapter 1, section 1.6.2. <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>.
\28\ Center for Medicaid and CHIP Services Informational
Bulletin, ``Opportunities to Increase Enrollment in Medicare Savings
Programs,'' November 1, 2021. <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/cib11012021.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/cib11012021.pdf</a>.
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After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal at Sec. 435.911(e) with the following
modifications:
<bullet> We are replacing references to section 1902(a)(10)(E) of
the Act with the term the ``Medicare Savings Programs'' throughout
paragraph (e);
<bullet> We are adding language to paragraph (e) to clarify that
the obligations in this paragraph apply to MSP eligibility
determinations for

[[Page 65239]]

individuals who have applied for LIS and have granted permission for
SSA to share LIS leads data with the Medicaid agency for the purpose of
submitting an application for the MSPs;
<bullet> We are reordering the paragraphs, revising requirements,
and clarifying language as follows:
++ Paragraph (e)(1): We are retaining the requirement to accept LIS
leads data in paragraph (e)(1) but are removing the term ``Low Income
Subsidy application data'' and using an acronym in place of ``Social
Security Administration'' since ``LIS leads data'' and ``SSA'' are now
established in paragraph (e);
++ Paragraph (e)(2): We are keeping the requirement to treat LIS
leads data as an application for the MSPs without requiring submission
of another application in paragraph (e)(2), but are moving the
requirement regarding timely application processing to paragraph
(e)(7).
++ Paragraph (e)(3): We are moving the requirement to accept data
from SSA, which we are now specifying as LIS leads data for greater
consistency in terminology throughout the regulation, without further
verification, from proposed paragraph (e)(5) to paragraph (e)(3) and
adding that this provision applies unless the State agency has
information that is not reasonably compatible with the LIS leads data
or the LIS leads data would not support a determination of MSP
eligibility;
++ Paragraph (e)(4): We are retaining the requirement to not
collect information or documentation from the individual in paragraph
(e)(4) and are adding that this is unless the State agency has
information that is not reasonably compatible with the LIS leads data;
++ Paragraph (e)(5): We are moving the requirement to request
additional information from proposed paragraph (e)(3) to paragraph
(e)(5), replacing the term ``request'' with the term ``seek,'' and
defining additional information needed for the MSP determination as
information that is not in the LIS leads data;
++ Paragraph (e)(6): We are moving the requirement to verify an
individual's citizenship and immigration status from proposed paragraph
(e)(6)(iii) to paragraph (e)(6), adding a citation to Sec. 435.406,
and streamlining the regulation text;
++ Paragraph (e)(7): We are moving the requirement regarding timely
application processing from paragraph (e)(2) to paragraph (e)(7);
++ Paragraph (e)(8): We are moving additional requirements if the
LIS leads data does not support a determination of MSP eligibility from
proposed paragraph (e)(7) to paragraph (e)(8).
++ Paragraph (e)(9): We are moving and modifying the proposal
related to screening for full Medicaid from paragraphs (e)(6)(i) and
(ii) to paragraphs (e)(9)(i) and (ii) to require States to provide
individuals with--in addition to and separate from any requests for
additional information necessary for a determination of Medicare
Savings Program eligibility, unless CMS approves otherwise--information
about the availability of additional Medicaid benefits on other bases,
including the scope of such benefits and responsibilities of the
individual applying for such benefits, and an opportunity to furnish
such additional information as may be needed to determine whether the
individual is eligible for such additional Medicaid benefits.
<bullet> Finally, we are applying a compliance date of April 1,
2026 for States to come into full compliance with all the provisions in
new Sec. 435.911(e) to facilitate MSP enrollment through LIS leads
data.
Streamlining Methodologies. Prior to January 1, 2024, the Federal
resource limits for full LIS and the MSPs are the same ($9,090 for an
individual and $13,636 for a couple in 2023), and the income limits for
full LIS and the highest income band MSP (the QI group) are both 135
percent of the FPL. Beginning January 1, 2024, section 11404 of the
Inflation Reduction Act (IRA) expands eligibility for the full LIS
benefit by revising the statutory income limit to 150 percent of the
FPL and increasing the resource limits for full LIS to the resource
limits for partial LIS ($15,160 for an individual and $30,240 for a
couple in 2023). The IRA did not make conforming changes to the income
or resource standards for the MSPs.
While the income and resources methodologies for the MSPs and LIS
are very closely aligned, certain differences prevent LIS enrollees
from being seamlessly enrolled into the MSPs unless the State has
elected to align the MSP methodologies with LIS methodologies by
adopting certain income and resource disregards under section
1902(r)(2) of the Act. As we discussed in detail in the proposed rule
(87 FR 54765), States have the flexibility to achieve full alignment of
the MSP and LIS financial methodologies. If States choose to completely
align MSP and LIS financial methodologies, they would disregard the
following types of income: in-kind support and maintenance, dividend
income, and interest income; and the value of the following types of
resources: non-liquid resources, and life insurance. States would also
disregard up to $1,500 in burial funds for an applicant (and an
additional $1,500 for their spouse) that may be co-mingled with other
accounts (that is, no longer require such funds are set aside in a
separate burial account).
As noted previously in this final rule, States that adopt less
restrictive MSP eligibility methodologies to completely align them with
the LIS methodologies would be able to use leads data to make a
determination of MSP financial eligibility without requesting
additional financial information from the individual.\29\
---------------------------------------------------------------------------

\29\ Except, as noted previously in this final rule, information
on citizenship and immigration status.
---------------------------------------------------------------------------

However, States that have not fully aligned methodologies must
determine financial eligibility by requesting additional information
not provided through the leads data. In addition, as noted in the
proposed rule at 87 FR 54766, if not already contained in the record
from a prior application, all States--whether or not they have aligned
their MSP financial methodologies with MSP--must request information
relating to U.S. citizenship and immigration status to verify such
status in accordance with the State's usual processes in accordance
with Sec. 435.406(a) and section 1137(d) of the Act.
In accordance with the authority at section 1902(a)(4) of the Act
to promote the administrative efficiency of the program and section
1902(a)(19) of the Act relating to simplicity of administration and the
best interests of beneficiaries, we proposed to add a new paragraph (e)
to Sec. 435.952 to require that States adopt a number of enrollment
simplification policies related to the income and resources that are
counted in determining MSP, but not LIS, eligibility that would enable
State agencies to use the leads data more efficiently, reduce burden on
applicants and States, and increase the number of LIS enrollees
successfully enrolled in the MSPs. We also anticipate these policies
will have a positive health equity impact by increasing access to
Medicare coverage for low-income individuals and increasing the
financial security of those who successfully enroll, consistent with
the January 20, 2021 Executive Order.\30\
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\30\ <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/">https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/</a>.
---------------------------------------------------------------------------

Finally, we anticipate that these enrollment simplifications will
help reduce the high rate of churn (cycling in and out of Medicaid
coverage) that

[[Page 65240]]

dually eligible individuals experience largely due to administrative
reasons such as providing documentation of certain income and assets to
demonstrate their continued eligibility. Analyses by the Assistant
Secretary for Planning and Evaluation (ASPE) of the Department of
Health and Human Services found that almost 30 percent of individuals
lost Medicaid eligibility for at least one month during the first year
of transitioning to full-benefit dual eligibility and more than 20
percent lost Medicaid eligibility for at least 3 months following the
transition despite dually eligible individuals' relatively stable
income and assets over time.31 32 Experts interviewed noted
that dually eligible individuals most often lost coverage because of
failing to comply with administrative requirements as opposed to
changes in income, assets, or functional status. We discuss our
proposed simplifications for each source of income and resource below.
---------------------------------------------------------------------------

\31\ Assistant Secretary for Planning and Evaluation (ASPE),
``Loss of Medicare-Medicaid dual eligible status: Frequency,
contributing factors and implications'' May 2019. <a href="https://aspe.hhs.gov/system/files/pdf/261716/DualLoss.pdf">https://aspe.hhs.gov/system/files/pdf/261716/DualLoss.pdf</a>.
\32\ CMS completed an updated internal analysis of ASPE's study
in 2021 using data from 2015-2018 that shows that dually eligible
individuals continue to lose Medicaid at a high rate in their first
year due to administrative reasons.
---------------------------------------------------------------------------

We received comments on our proposals to align the MSP and LIS
programs in general, and our responses follow.
Comment: Many commenters supported CMS's proposed alignments of MSP
and LIS programs in general, citing that the proposed changes would
allow States to use LIS leads data more efficiently, increase MSP
enrollment for LIS enrollees, have a positive health equity impact, and
reduce churn for all dually eligible individuals. Many commenters
explained that procedural hurdles, particularly documentation
requirements, are among the main reasons eligible individuals fail to
complete the enrollment process or that benefits are delayed for
individuals who manage to complete the process. A commenter explained
that collecting paper records is particularly overwhelming for low-
income individuals, who disproportionately have unstable housing, low
literacy, limited access and proficiency in internet usage, limited
proficiency in English, and live with disabilities and chronic
conditions. The commenter stated that adopting measures to reduce these
unnecessary impediments falls squarely within CMS's legal authority.
MACPAC supported this proposal, noting consistency with its June 2020
recommendations to Congress to align MSP and LIS income and resource
requirements. A few commenters shared that their States are moving
toward complete alignment of LIS and MSPs and expressed support for
CMS's proposal to determine individuals eligible for the MSPs based on
LIS data without seeking additional information if the LIS and MSP
programs are completely aligned.
Response: As discussed in the proposed rule (87 FR 54766 & 54767),
we anticipate that streamlining income and resources verification
processes and improving alignment between the LIS and MSP programs will
allow States to employ LIS data more effectively, reduce churn for
dually eligible individuals, and increase the percentage of LIS
enrollees who are enrolled in the MSPs, resulting in significant
economic and health benefits and promoting health equity for low-income
Medicare beneficiaries. For that reason, as explained in the proposed
rule (87 FR 54766 and 54767), adopting enrollment simplifications for
income and resources that are relevant to MSP determinations, but not
LIS, implements our authority at section 1902(a)(4) of the Act to
promote the administrative efficiency of Medicaid and section
1902(a)(19) of the Act regarding simplicity of administration and the
best interests of beneficiaries. We also appreciate that some States
are moving toward full alignment, which we recommended in the proposed
rule (87 FR 54765). We believe that full alignment of financial
eligibility rules for LIS and the MSPs is the most efficient means for
States to maximize leads data and improve participation in the MSPs for
LIS enrollees.
Comment: A number of commenters noted that the proposals would
create different verification processes for the MSPs than for other
Medicaid groups. Some commenters opposed applying different
verification processes for the MSPs on the grounds that it would be
administratively challenging and cause confusion and delays. Both the
commenters that generally opposed and the commenters that generally
supported our proposals expressed concerns that creating a separate
process for the MSPs could require significant system modifications. A
commenter, while supporting the proposals at new Sec. 435.952(e) to
simplify income and resources verification procedures for MSP
determinations, suggested that CMS consider adopting these requirements
through sub-regulatory guidance to allow States flexibility to adopt
less restrictive income and resource methodologies.
Response: We generally agree with the aim of providing uniform
eligibility and enrollment processes, and we are committed to ensuring
their operational feasibility. However, many States already apply
different rules to the MSPs than other non-MAGI populations. For
example, many States have adopted disregards that effectively raise or
remove the resource test for the MSPs only. Therefore, we conclude that
applying separate rules for the MSPs is not an insurmountable barrier
to effective implementation.
Further, in addition to comments on the proposed rule, feedback
from interested parties and program experience demonstrate that
documentation requirements seriously hinder the ability of eligible
individuals to enroll in the MSPs, with significant economic and health
impacts for individuals.\33\ Reducing the burden on applicants to
produce certain types of documentation prior to enrollment is warranted
to meaningfully address documented under-enrollment in these programs.
Through this final rule, we are allowing additional time for States to
update State procedures and systems, as discussed below. In addition,
with respect to the commenter's concerns that our regulations at Sec.
435.952(e) may impede State flexibility to relax MSP eligibility
requirements, we clarify that they would not impede State's ability to
adopt more liberal income and resource methodologies under 1902(r)(2)
of the Act.
---------------------------------------------------------------------------

\33\ See for example, CMS Office of Burden Reduction & Health
Informatics, ``Navigating the Medicare Savings Program (MSP)
Eligibility Experience,'' April 2022. <a href="https://www.cms.gov/files/document/navigatingmedicare-savings-program-msp-eligibilityexperience-journey-map.pdf">https://www.cms.gov/files/document/navigatingmedicare-savings-program-msp-eligibilityexperience-journey-map.pdf</a>.
---------------------------------------------------------------------------

Comment: Several other commenters opposed CMS's alignment of MSP
and LIS programs, asserting that requiring States to accept self-
attestation would lead to fraud. A commenter cited difficulties with
having their State legislature approve self-attestations due to program
integrity concerns. Another commenter requested clarification regarding
how reasonable compatibility standards would apply to resources
obtained through electronic sources. In addition, a commenter, while
supporting CMS proposals to require self-attestation of certain income
and resources for the MSPs, requested that Federal audit protocols
exempt States from penalties for errors related to self-attestation.
Response: As stated elsewhere, self-attestation is an acceptable
means of verification, and we note that many States have incorporated
self-attestation

[[Page 65241]]

into their Medicaid verification plans. We also reiterate that, prior
to enrollment, States must seek additional information if the self-
attested information is not reasonably compatible with State
information and that States retain the option to verify self-attested
information after the individual has been enrolled. We plan to address
the commenter's question about how reasonable compatibility standards
would apply to resources obtained through electronic sources in future
rulemaking concerning the remaining provisions in the proposed rule
published in the September 7, 2022 Federal Register.
Regardless of whether a State legislature objects to self-
attestation as a means of verification, States are still required to
follow Federal regulations. Further, as noted at 87 FR 54765, States
also have the ability to align the MSP and LIS income and resource
methodologies, which would remove the need for States to separately
verify income and/or resources that are missing from leads data. In
response to the question about Federal audits, we reiterate that we
conduct audits based on Federal statutory and regulatory requirements.
To the extent that we review compliance with Sec. 435.952(e), we would
identify an error if a State has failed to comply with this provision
and would not identify an error if the State is complying with this
requirement.
Comment: A few commenters sought clarifications or additional CMS
action. For example, a commenter requested clarification on why MSP and
LIS income and resources standards are only aligned until January 1,
2024. Another commenter requested that CMS require States to adopt
verification plans for the MSPs and other non-MAGI groups. A different
commenter requested that CMS provisions to promote MSP enrollment and
retention extend to the Programs of All-Inclusive Care for the Elderly
(PACE) for individuals dually entitled to Medicare and Medicaid.
Response: Prior to January 1, 2024, Federal resource limits for
full LIS and the MSPs are aligned, and the income limits for the full
LIS benefit and the highest band MSP (the QI group) are the same.
Section 11404 of the IRA expanded eligibility for the full LIS benefit
beginning January 1, 2024, but did not make any conforming changes for
the MSPs. Starting January 1, 2024, individuals who previously were
eligible only for partial LIS benefits may be eligible for full LIS
benefits under the changes enacted under the IRA. This is because the
resource limit for full LIS will increase to the current partial LIS
resource limit ($15,160 for an individual and $30,240 for a couple in
2023).
While more individuals will qualify for full LIS beginning in 2024,
and many full LIS enrollees will continue to qualify for the MSPs,
beginning in 2024 there will be more full LIS enrollees who do not
qualify for the MSPs. This is because the MSP resource limit will
remain unchanged. Also, while the income threshold for full LIS will
increase to 150 percent of the FPL beginning in 2024, the Federal
income threshold for the QI group will remain at 135 percent of FPL.
While we acknowledge that the income and resource limits for full LIS
and MSPs will no longer align after January 1, 2024, we still expect
that the methodological changes that we are finalizing in this final
rule will result in streamlined enrollment into MSPs.

Table 1--Comparison of MSP and LIS Income and Resource Limits *
------------------------------------------------------------------------
Income limit Resource limit
------------------------------------------------------------------------
QMB............................. <=100% FPL........ 3 x SSI limit
adjusted for
inflation per
section
1905(p)(1) of the
Act.
SLMB............................ >100% FPL, but same as QMB.
<120% FPL.
QI.............................. >=120% FPL, but same as QMB.
<135% FPL.
Full LIS before 2024............ <135% FPL......... same as QMB.
Full LIS beginning 2024......... <150% FPL......... $15,160--Individua
l.
$30,240--Couple
plus inflation.**
------------------------------------------------------------------------
* These are the standard Federal income limits and resources. All of
these income limits include a standard $20 disregard. States may use
authority under section 1902(r)(2) of the Act to implement income and/
or resource methodologies that are more generous than the Federal
baseline for QMB, SLMB, and QI.
** The LIS resource methodology as of January 1, 2024 is no longer tied
to the 3 x SSI resource limit, which is a lower rate, but is instead
tied to a flat dollar amount of $10,000 for an individual and $20,000
for a couple from 2006 and indexed for inflation every year. The rate
listed is the 2023 rate, which will need to be adjusted upward by
inflation for 2024.

In addition, we clarify that, in accordance with Sec. 435.945(j),
States must already adopt verification plans for all Medicaid
eligibility groups, including the MSPs and other non-MAGI groups.
Finally, we note that our proposals would apply to current and
potential PACE participants.
Interest and Dividend Income. Regulations governing LIS eligibility
determinations at 20 CFR 418.3350(d) exclude all interest and dividend
income earned on resources owned by the applicant or their spouse.
However, under the SSI income methodologies applicable to MSP
determinations, States must count interest and dividend income unless
they have elected to disregard such income under section 1902(r)(2) of
the Act and Sec. 435.601(d).
In the proposed rule (87 FR 54767), citing reports from interested
parties and program experience, we noted that the vast majority of
individuals likely to qualify for an MSP eligibility group do not have
significant interest or dividend income, whereas the requirement to
timely obtain and furnish acceptable statements from financial
institutions, sometimes extending back over a lengthy period of time,
to document interest and dividend income earned is unduly burdensome
for applicants and provides negligible program integrity value.
Therefore, consistent with section 1902(a)(19) of the Act, to minimize
undue administrative burden on applicants, we proposed at Sec.
435.952(e)(1)(i) and (ii) to prohibit States from requesting
documentation of dividend and interest income prior to making a
determination of MSP eligibility, except when the agency has
information that is not reasonably compatible with the applicant's
attestation. Under the proposed rule, States would be required to
accept self-attestation of dividend and interest income for MSP
applicants and their spouse, but would retain the option to verify such
income after the individual has been enrolled (a process, currently
available at State option with respect to most eligibility criteria,
which we refer to as ``post-enrollment verification''), including the
option to require the

[[Page 65242]]

individual to provide documentation of interest or dividend income if
electronic verification is not available.
We received comments on our proposal to streamline eligibility and
verification processes for dividend and interest income, and our
responses follow.
Comment: A few commenters indicated particular support for this
provision, explaining dividend and interest information is often
difficult for applicants to obtain and constitutes an unnecessary
administrative burden for applicants. One commenter noted an example in
which an applicant was required to provide dividend verification based
on a report from the IRS of a total annual dividend of under $5 on a
single share of stock of a former employer worth less than $50. The
agency required documentation verifying both the value of the asset and
the amount of the dividend. According to the commenter, the process of
clarifying the source of the dividend at issue and then obtaining
documentation of the share, its current value, and the dividend payment
history for the last year took several months, even with the assistance
of an advocate, significantly delaying completion of the application
and receipt of benefits. Lastly, another commenter requested
clarification about whether consideration of interest income applies
only to screening MSP applications from LIS leads data or to
eligibility determinations for all individuals who apply for MAGI-based
groups.
Response: Self-attestation minimizes undue administrative burden on
applicants who are unlikely to have investments large enough to
generate significant interest or dividend income and resources and
still satisfy the resource test for the LIS or MSP benefit. States
retain the option to verify the information from the self-attestation
after the individual has been enrolled, including requiring the
individual to provide documentation of interest or dividend income if
electronic verification is unavailable.
With respect to the commenter's requests for clarifications for how
consideration of interest income applies to MAGI groups, we believe the
commenter was referring instead to whether this provision requiring
self-attestation of interest and dividend income applies to all
individuals applying to MSP or only those who use the LIS process to
apply. As such, we clarify that our proposal regarding required self-
attestation for MSP eligibility determinations applies regardless of
whether an individual applies for an MSP directly through the Medicaid
agency or indirectly through the LIS pathway. Additionally, we note
that interest and dividend income is currently counted in both MAGI and
non-MAGI eligibility determinations.
After considering the comments we received and for the reasons
outlined in the proposed rule under Sec. 435.952(e)(1)(i) and (ii) and
our responses to comments, we are finalizing our proposal on self-
attestation for interest and dividend income, except with a modified
compliance date of April 1, 2026.
Post-eligibility Verification. We also sought comment on the
utility of post-enrollment verification and whether it results in
unnecessary procedural denials of eligible individuals. If a State
chooses to conduct post-enrollment verification checks, under proposed
Sec. 435.952(e)(1)(iii) it must allow individuals at least 90 calendar
days to respond to requests for documentation. We sought comment on the
proposal to require that States provide individuals with at least 90
calendar days to respond to requests for additional information in this
situation and whether States should be required to provide, at a
minimum, a shorter period of time, such as at least 30 or 60 calendar
days. If a State found that an individual has income exceeding the
income standard during the post-enrollment verification process, the
State would take appropriate action consistent with regulations at
Sec. 435.916(d), which we proposed to redesignate and revise at Sec.
435.919 in the proposed rule, including determining eligibility on
other potential bases and, if not eligible on any basis, providing
advance notice and fair hearing rights prior to terminating MSP
coverage. We note that, consistent with current policy, when a State
has information that is not reasonably compatible with the applicant's
attestation of the value of any interest or dividend income, proposed
Sec. 435.952(e)(1)(ii) would require the State to seek additional
information in accordance with Sec. 435.952(c)(2), prior to enrolling
the individual in Medicaid.
We received the following comments on post-enrollment verification,
including the timeline for responding to requests for additional
information, and our responses follow.
Comment: Some commenters requested CMS minimize post-enrollment
verification as much as possible because it would be too burdensome and
confusing for individuals and may lead to terminations for eligible
individuals. A few commenters requested that CMS provide model notices
to States because requests for information can cause confusion or be
missed by individuals who have just been approved for benefits. A
commenter also requested that States include information in these post-
eligibility verification notices on disputing errors. A few commenters
requested clarification on how post-enrollment verification would
affect eligibility for long-term care services and if a denial would
trigger benefit recovery. Other commenters indicated the process would
be too burdensome for States and, therefore, opposed requiring States
to adopt post-eligibility verification.
Response: We acknowledge that post-enrollment verification, like
other requests for additional information/documentation, could pose a
burden to individuals. However, to allow self-attestation of income and
resources needed for MSP eligibility determinations but missing from
leads data, we believe it is essential to provide States a mechanism to
ensure program integrity. To help minimize burden and assist States in
making beneficiary notices as comprehensive and clear as possible, we
will explore providing model language for State communications
regarding post-enrollment verification, including the instructions
about disputing errors contained in the post-enrollment verification
notice. With regard to the commenters' recommendation that post-
eligibility verifications be optional, we note that we did not propose
making this mandatory for States. In response to the commenter's
question about how post-eligibility verification may affect beneficiary
coverage for long-term care services, we clarify that our proposal only
requires self-attestation for the MSPs and not other non-MAGI groups.
Comment: A number of commenters provided feedback on the proposed
90-day minimum deadline for individuals to return information requested
by a State. Several commenters supported providing at least 90 calendar
days for individuals to respond with the requested information, citing
longstanding barriers to verification for individuals. However, a
commenter observed that 90 days was too long based on their State's
experience using a 90-day timeline to resolve income discrepancies. The
commenter noted that individuals forgot to supply the requested
information as a result of the prolonged timeline and recommended 30
days instead. Another commenter opposed a 90-day timeline for post-
enrollment verification because it could lead to 3 months of improper
payments. Another commenter, while supporting the option for post-
eligibility

[[Page 65243]]

verification, sought clarification on whether States would need to
recoup Medicaid provider payments for an individual for whom the State
had accepted self-attestation prior to enrollment and then determines
ineligible through post-eligibility verification.
Response: We thank the commenters for their input on the
appropriate minimum timeframe for individuals to respond to requests
for information following enrollment. We do not agree with commenters
that the 90-day timeframe is excessive given the challenges low-income
individuals encounter in obtaining and furnishing paperwork, as
described throughout this final rule and by commenters. Our position is
also informed by our program guidelines and experience related to
resolving income data matching issues (DMIs) following determinations
of eligibility for Advance Premium Tax Credits (APTC) for the Exchanges
that use the Federal eligibility and enrollment platform. A 90-day
period aligns with the minimum deadline for individuals to respond to
Exchange requests for additional information under 45 CFR
155.315(f)(2)(ii). We note that in the April 2023 final rule titled
``Patient Protection and Affordable Care Act, HHS Notice of Benefit and
Payment Parameters for 2024'' (2024 Payment Notice) published in the
Federal Register (88 FR 25740), we adopted an automatic 60-day
extension for individuals applying for coverage through Exchanges who
failed to respond in the 90-day period. We adopted that change in the
2024 Payment Notice after observing that income DMI data indicates that
when consumers receive additional time, they are more likely to
successfully provide documentation to verify their projected household
income. Between 2018 and 2021, over one third of consumers who resolved
their income DMIs on the Exchange did so in more than 90 days. We also
note that the Exchanges that use the Federal eligibility and enrollment
platform send reminders to consumers through multiple modalities to
prompt them to timely furnish the required information.
In response to the commenters' concerns about the potential for
increasing improper payments, we note that self-attestation is an
acceptable means of verification and that many States have incorporated
it into their verification policies as a generally reliable alternative
to requiring applicants to produce documentation. As such, the period
during which an individual would be enrolled in an MSP based on self-
attestation that proved to be incorrect would not be an improper
payment, nor would an individual be subject to administrative benefit
recovery if they are later found to be ineligible. In addition, we
clarify that States would not administratively recoup payments already
made on behalf of individuals if post-eligibility verification
processes establish that the individual is ineligible for the MSPs. If
a State suspects that an individual committed fraud or abuse in order
to obtain or maintain MSP eligibility, the State should follow the
processes described at 42 CFR part 455, subpart A of the regulations.
After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal to require States that choose to conduct post-
eligibility verification to provide individuals with at least 90
calendar days to respond to requests for additional information, with a
modified compliance date of April 1, 2026.
Non-liquid resources. For LIS eligibility determinations, under 20
CFR 418.3405, SSA only counts liquid resources, which it defines as
cash, financial accounts, and other financial instruments that can be
converted to cash within 20 business days. Non-liquid resources, such
as an automobile, are not counted for LIS eligibility.\34\ However, MSP
determinations generally use a broader definition of countable
resources that includes non-liquid resources; for example, while one
automobile is excluded for resource-eligibility purposes, a second
automobile is countable. As we noted in the proposed rule at 87 FR
54768, this can be onerous for MSP applicants because it can be
difficult to timely determine, and furnish acceptable documentation of,
the value of something that cannot easily be sold.
---------------------------------------------------------------------------

\34\ The exception to this rule is that the equity value of any
real property than an individual owns other than the individual's
primary place of residence is counted as a resource.
---------------------------------------------------------------------------

Similar to interest and dividend income, consistent with section
1902(a)(19) of the Act and to minimize administrative burdens on
individuals, we proposed at Sec. 435.952(e)(2)(i) to require that
States accept applicants' attestation of the value of any non-liquid
resources, except, as described at proposed Sec. 435.952(e)(2)(ii),
when the State has information that is not reasonably compatible with
the individual's attestation. As with dividend and interest income,
proposed Sec. 435.952(e)(2)(ii) clarifies that States must request
documentation prior to making an initial determination of eligibility
if they have information that is not reasonably compatible with the
applicant's attestation in accordance with Sec. 435.952(c)(2).
However, as with dividend and interest income, States would retain the
option to conduct post-enrollment verification, including the option to
require the individual to provide documentation of non-liquid resources
if electronic verification is not available, and to take appropriate
action, consistent with regulations at Sec. 435.916(d), which we
proposed to redesignate and revise at Sec. 435.919 in the proposed
rule, if the State determines the individual greatly undervalued or
failed to disclose resources. If the agency elects to conduct
verifications post-enrollment, and documentation is requested, we
proposed that the agency must provide the individual with at least 90
calendar days from the date of the request to respond and provide any
necessary information requested.
We received comments on our proposal to require States to accept
self-attestation on non-liquid assets and prohibit States from
requesting documentation except where the agency has information
incompatible with a self-attestation, and our responses follow.
Comment: In addition to several commenters expressing general
support for self-attestation for simplifying enrollment regarding
income, one commenter supported the proposal on non-liquid assets
because this information is often difficult for applicants to obtain
and poses unnecessary administrative burdens on applicants.
Response: Self-attestation minimizes undue administrative burden on
applicants, including identifying the value of a non-liquid asset that
cannot be sold. States retain the option to verify the information from
the self-attestation with new information after the individual has been
enrolled, including requiring the beneficiary to provide documentation
of non-liquid resources if electronic verification is not available,
and take appropriate action if the State determines the individual
greatly undervalued or failed to disclose resources.
After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal on non-liquid assets with a modified compliance
date of April 1, 2026.
Burial funds. Under section 1613(d)(1) of the Act, which applies to
both LIS and MSP determinations, up to

[[Page 65244]]

$1,500 in burial funds are to be excluded for the applicant (and an
additional $1,500 for their spouse) so long as the burial fund is
``separately identifiable and has been set aside.'' The statute does
not, however, prescribe how the funds must be separately identifiable.
As discussed in the proposed rule at 87 FR 54768, current SSA policy
allows LIS applicants to attest to having $1,500 in burial funds, which
may be co-mingled with other funds in a single account, but for MSP
eligibility determinations States typically require applicants to
provide documentation that their burial funds are set aside in a
separate account. This creates a misalignment between LIS and MSP
methodologies and imposes additional burdens on MSP applicants.
We proposed at Sec. 435.952(e)(3)(i) to require that States, when
determining eligibility for the MSPs, allow individuals to self-attest
that up to $1,500 of their resources, and up to $1,500 of their
spouse's resources, are set aside as burial funds in a separate
account, and therefore, are not countable as resources for MSP
determinations. Proposed Sec. 435.952(e)(3)(ii) clarifies that States
must request documentation prior to making an initial determination of
eligibility if they have information that is not reasonably compatible
with the applicant's attestation in accordance with Sec.
435.952(c)(2). As in the proposed provisions for interest and dividend
income and non-liquid resources, and described at Sec.
435.952(e)(3)(iii), States would retain the option to conduct post-
enrollment verification, including requiring documentation of resources
in burial funds, and taking appropriate action, consistent with
regulations at Sec. 435.916(d), which we proposed to redesignate and
revise at Sec. 435.919 in the proposed rule. Under proposed Sec.
435.952(e)(1)(iii), if the agency elects to conduct verifications post-
enrollment and requests documentation, the agency must provide the
individual with at least 90 calendar days from the date of the request
to respond and provide any necessary information requested.
Finally, States may also use authority at section 1902(r)(2) of the
Act to disregard all or a greater amount of burial funds or to not
require that the burial funds be held in a separate set-aside account.
We received comments on our proposals related to burial funds, and
our responses follow.
Comment: A few commenters specifically wrote in support of
accepting self-attestation for burial funds. A commenter suggested that
the rule be revised so that applicants are not required to maintain a
separate account for burial funds or that they can acknowledge in their
self-attestation that they will set up a separate account within 90
days of the self-attestation. This commenter also noted that low-income
individuals are disproportionately ``unbanked'' and thus do not have
access to banks where they can segregate funds in separate accounts.
Response: Self-attestation minimizes undue administrative burden on
applicants. States retain the option to verify the information from the
self-attestation after the individual has been enrolled, including
requiring the beneficiary to provide documentation of burial fund
resources and take appropriate action if the State determines the
individual greatly undervalued or failed to disclose resources. We
appreciate the commenter's concern that creating a separate account
poses additional burdens on applicants, including those who are
``unbanked.'' However, as described previously in this final rule,
section 1613(d)(1) of the Act stipulates that the burial fund exclusion
applies to funds that are ``separately identifiable'' and have been
``set aside.'' Accordingly, in this final rule, we decline to
incorporate the commenter's suggestions to require States to eliminate
the requirement for a separate account for burial funds. We also
decline to allow 90 days post self-attestation to create a separate
account in this final rule, but we may consider whether there is a
basis for such a policy in the future. As noted previously in this
final rule, States may choose to eliminate the requirement that burial
funds be held in a separate account under section 1902(r)(2) of the
Act.
After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal on burial funds with a modified compliance date
of April 1, 2026.
Life Insurance Policies. Section 116 of MIPPA, codified at section
1860D-14(a)(3)(G) of the Act, eliminated the value of life insurance
policies as a countable resource for LIS determinations. However, under
the SSI resource methodologies described in section 1613(a) of the Act,
which applies to MSP-related resource eligibility determinations per
section 1905(p)(1)(C) of the Act, the cash surrender value of life
insurance with a total face value exceeding $1,500 is countable.
As discussed in the proposed rule at 87 FR 54768, obtaining
documentation of a life insurance policy's cash surrender value can be
highly burdensome for applicants, as the cash surrender value is not
knowable from the documents a policyholder is likely to have.
Under proposed Sec. 435.952(e)(4)(i), if an individual attests to
having a life insurance policy with a face value below $1,500, States
must accept the attested face value for purposes of making an initial
eligibility determination for MSP coverage, unless the State has
information that is not reasonably compatible with attested
information. If the total face value of all of an individual's life
insurance policies does not exceed $1,500, the cash surrender value of
the individual's policies is not counted in determining MSP eligibility
pursuant to sections 1613(a)(16) and 1905(p)(1)(C) of the Act.
Under proposed Sec. 435.952(e)(4)(i)(A), if an individual attests
to having a life insurance policy with a face value in excess of
$1,500, consistent with current regulations at Sec. 435.948, States
may accept the attested cash surrender value.
In both cases, if the State has information that is not reasonably
compatible with the attested face value or cash surrender value of the
policy, we proposed at Sec. 435.952(e)(4)(ii) that the State must seek
additional information from the individual in accordance with Sec.
435.952(c)(2). Per current Sec. 435.952(c)(2), the agency may accept a
reasonable explanation from the applicant or require documentation.
As with interest and dividend income, per proposed Sec.
435.952(e)(4)(iii), States would have the option to conduct post-
enrollment verification for individuals enrolled based on an attested
face value. In conducting post-enrollment verification, if a State
determines that the face value of the policy exceeds $1,500, then the
State must seek the cash surrender value on behalf of the individual in
accordance with proposed Sec. 435.952(e)(4)(iv)(A) and take
appropriate action, consistent with regulations relating to changes in
circumstances at Sec. 435.916(d) (which we proposed to redesignate and
revise at Sec. 435.919 in the proposed rule).
We also proposed at Sec. 435.952(e)(4)(iv)(A) that when
documentation of the cash surrender value of a life insurance policy is
required, the State must assist the individual with obtaining this
information and documentation by requesting that the individual provide
the name of the insurance company and policy number and authorize the
State

[[Page 65245]]

to obtain such documentation on the individual's behalf. The agency may
also request, but may not require, additional information from the
applicant to assist the agency in obtaining documentation of the cash
surrender value, such as the name of an agent. If the individual does
not provide basic information about the policy and an authorization,
under proposed Sec. 435.952(e)(4)(iv)(B), the State may require that
the individual provide documentation of the cash surrender value. Under
proposed Sec. 435.952(e)(4)(iv)(C), the State must provide the
individual with at least 15 calendar days to provide such documentation
if required pursuant to paragraph (e)(4)(i) or (ii) of this section
(that is, if documentation of the cash surrender value is needed prior
to the agency's making a determination of eligibility) and at least 90
calendar days if required pursuant to paragraph (e)(4)(iii) of this
section (that is, post-enrollment). We note that the minimum of 15
calendar days in proposed Sec. 435.952(e)(4)(iv)(C) for applicants to
provide documentation of cash surrender value of a life insurance
policy is consistent with the minimum 15 calendar days that we propose
States must generally provide applicants to provide required
documentation under proposed Sec. 435.907(d).
We sought comment on whether 15 calendar days or a longer minimum
period, such as 20 calendar days or 30 calendar days, appropriately
balances the complexity of determining and obtaining documentation of
the cash surrender value with the 45-day limit for States to complete
Medicaid eligibility determinations for individuals applying on a basis
other than disability status under Sec. 435.912(c)(3).
In the proposed rule (87 FR 54768 through 54769), we acknowledged
that our proposal would represent a significant change for a number of
States and could present some administrative challenges to implement.
However, documenting the cash surrender value of life insurance is a
considerable hurdle for many applicants. Because the cash surrender
value of most applicants' policies is likely very modest, we noted that
the value of any life insurance policy likely would have a minimal
impact on their financial eligibility for coverage, whereas obtaining
documentation of the cash surrender value may pose a substantial
administrative barrier to access. Implementing a process that places
fewer burdens on applicants is in the interest of efficient
administration of the program, consistent with section 1902(a)(4) of
the Act. We also expected that States would be better able to navigate
obtaining such documentation when needed.
We received comments on our proposals related to life insurance,
and our responses follow.
Comment: Many commenters provided feedback on the proposals to
streamline verification processes for life insurance. Some commenters
supported the provision, agreeing with CMS that the need to verify the
cash value of a life insurance policy is an extremely challenging
hurdle for many MSP applicants. One commenter noted that obtaining a
letter from the insurer providing cash value can take weeks and often
longer and noted that finding the right contact can be challenging
because many insurers have closed their businesses or merged or
transferred portions of their insurance portfolios to other companies.
Several commenters agreed with the proposal to shift the burden to
States to verify the cash surrender value, concurring that States were
in a better position to gather the information due to the demographics
of the applicants and the complexities of tracking down the
information. A commenter recommended that to obtain authorization from
the applicant to reach out to the insurer, States should inform the
individual of the reason for obtaining the information and that they
will safeguard the information. A few commenters, while supporting the
overall proposal, recommended that CMS extend the deadline for
providing documentation to 20 to 30 days for individuals who must
produce documentation after refusing to give consent to States to
contacting life insurance companies. However, the commenters added that
their primary concern is to avoid a requirement that impedes States
from meeting the 45-day timeline for making eligibility determinations.
Other commenters opposed our proposal to shift the burden to States
to verify the cash surrender value of life insurance, citing concerns
that it would increase work for eligibility workers and that insurance
companies may refuse to disclose this information to anyone except the
life insurance policy holder or their authorized representative. One
commenter stated that this burden shifting was unnecessary and their
State already provides help with obtaining the cash surrender value to
any individual who requests such assistance.
Response: We believe that our proposal appropriately balances the
interests of low-income older adults and individuals with disabilities
with the needs and resources of States. At the outset, we note that we
anticipate the life insurance provisions will affect only a very small
number of people. Applicants for MSPs tend to be low-income individuals
who do not have many assets, especially if they have income low enough
to qualify for the MSPs. Additionally, as discussed previously in this
final rule, the most popular form of life insurance for lower income
individuals, term life insurance, is not impacted by these proposals.
Moreover, as noted previously in this final rule, several States have
eliminated the asset test for the MSPs, while others have raised the
asset limit to $10,000 or more for life insurance policies.
In response to concerns about shifting the burden of verifying the
cash surrender value of life insurance from individuals to States, we
note that States can avoid this burden by simply disregarding life
insurance as an asset or increasing the limit using authority under
section 1902(r)(2) of the Act. Additionally, this policy is similar to
the support that SSA provides. While commenters have stated that they
prefer individuals have 30 days to provide life insurance
documentation, we are doubtful that States will be able to process MSP
applications in 45 days while providing 30 days to produce documents.
As such, we believe 15 days strikes the more appropriate balance.
In response to the commenter's suggestion to require States to
inform applicants that their personal information will be properly
safeguarded when the State requests authorization to contact the
applicant's life insurance company, we note that States are required to
safeguard information about applicants and beneficiaries obtained or
used to verify eligibility in accordance with 42 CFR 431, subpart F.
States must publicize their policies governing the confidential nature
of information about applicants and beneficiaries, including the legal
sanctions imposed for improper disclosure and use, as well as provide
copies of these policies to applicants and beneficiaries and to other
persons and agencies to whom information is disclosed in accordance
with Sec. 431.304. In this context, States would be required to
provide a copy of the State's policies related to confidentiality of
information to the applicant and to any representative of the
applicant's insurance company to whom applicant information may be
disclosed during the verification process. We decline to make a new,
more specific requirement, because we believe States should have
flexibility with regard to how they implement this requirement.

[[Page 65246]]

After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal on life insurance, with a modified compliance
date of April 1, 2026.
In-Kind Support and Maintenance. In-kind support and maintenance is
assistance an applicant receives that is paid for by someone else, such
as groceries or utilities paid for by an adult child. Section 1860D-
14(a)(3)(C)(i) of the Act, added by section 116 of MIPPA, excludes in-
kind support and maintenance as countable income for LIS
determinations. Under SSI methodologies at 20 CFR 416.1131, which apply
to MSP determinations, the value of in-kind support and maintenance, if
both food and shelter are received by an applicant, is presumed to be
one-third of the Federal benefit rate ($914 per month in 2023 for a
single person), unless the applicant provides documentation
demonstrating a different amount.
We did not propose any changes to regulations relating to in-kind
support and maintenance, but we sought comment on whether obtaining
documentation to rebut the one-third presumption poses a barrier to
eligibility and whether we should require States to accept self-
attestation from individuals who seek to rebut a presumption of the
amount of in-kind support and maintenance they receive subject to post-
enrollment verification.
We received the following comments on in-kind maintenance and
support, and our responses follow.
Comment: A commenter requested that CMS require States to accept
self-attestation for individuals seeking to rebut the presumption of
the amount of in-kind support and maintenance they receive, while
another commenter requested that CMS make this an option for States.
However, we did not receive any other specific feedback on this
proposal.
Response: As we discussed in the proposed rule (87 FR 54769),
States may already exercise the option of accepting self-attestation
for individuals seeking to rebut the presumption of the amount of in-
kind support and maintenance they receive. Alternatively, States can
further streamline the MSP eligibility and enrollment process for
individuals with in-kind maintenance and support by disregarding in-
kind support and maintenance entirely under section 1902(r)(2) of the
Act. While we decline to adopt specific requirements regarding
requiring self-attestation for in-kind maintenance and support at this
time, we will consider this input for future rulemaking.
Streamlined Methodologies for Other Non-MAGI and MAGI Groups. Our
proposals requiring States to apply enrollment simplifications to
income and resources that are counted for MSP determinations but not
for LIS only apply to MSPs. However, we sought comment on extending
these proposals to all individuals seeking eligibility on a non-MAGI
basis. We also sought comment on extending the proposal relating to
verification of dividend and interest income to individuals seeking
eligibility based on MAGI, as well as whether there are additional
income or resource types to which the proposals below could be extended
for all individuals.
We received the following comments, and our responses follow.
Comment: Some commenters opposed applying the proposed MSP
requirements to all non-MAGI populations. Some others supported this
concept, maintaining that applying uniform standards across eligibility
groups would help promote clarity for applicants and enhance the
utility of leads data for screening other bases of eligibility. A
commenter noted that documentation barriers apply equally to these
other non-MAGI groups and the need to simplify the processes for these
other groups are just as urgent. A few commenters supported applying
the income and dividend interest self-attestation requirements to MAGI
groups.
A commenter requested clarification on whether extending the
exclusion of these income types using flexibility afforded in section
1902(r)(2) of the Act would extend to post-eligibility treatment of
income (PETI), which involves how income is counted for beneficiaries
in a medically needy eligibility group, or if it would be similar to
how Veterans Affairs'(VA) Aid and Attendance is treated (excluded for
eligibility, included in PETI).
Response: We appreciate the comments and will consider them for
future rulemaking. With respect to the commenter's request for
clarifications about whether income disregards under section 1902(r)(2)
of the Act apply to post-eligibility treatment of income (PETI)
calculations, we confirm that any income excluded in an eligibility
determination using section 1902(r)(2) of the Act must be counted in
the PETI calculation. In the post-eligibility process, income includes
all amounts of income available to an individual from all sources that
are considered income for purposes of underlying eligibility, even if
such income is disregarded at the eligibility determination phase using
section 1902(r)(2) authority. Only income which is expressly exempted
from post-eligibility calculations under Federal law would not be
included in the post-eligibility process. However, we note that the
current proposal does not make any changes to how States may use
section 1902(r)(2) authority.
Comment: Several commenters expressed support for the proposed
changes to facilitate enrollment through Medicare Part D LIS leads data
in Sec. Sec. 435.4, 435.601, 435.911, and 435.952 but provided
feedback on areas that were not addressed in the proposed rule. For
example, a commenter requested that the definition of ``retirement
funds'' for the LIS program be aligned with the SSI and Medicaid
programs to exclude retirement funds that are in distribution status.
Another commenter recommended several ways that CMS could leverage Area
Agencies on Aging and SHIPs and other enrollment assistance providers
to streamline the MSP application process, such as requiring States to
allow such entities to access State eligibility systems and manage and
submit data and verifications on behalf of applicants. In addition, a
commenter recommended that CMS facilitate access to other public
benefits, including by helping to create a combined application for
Medicaid coverage and other benefits. A commenter recommended that CMS
encourage States to share data with the Indian health care system,
specifically Indian Health Services, Tribal, and Urban Indian
Organizations. Another commenter urged CMS to improve MSP outreach to
eligible individuals, for example, by updating CMS MSP outreach
templates to allow States to enter their own income and asset limits
and provide the contact information of the SHIP counselor. This
commenter further recommended that CMS incentivize States to remove
language access barriers for persons with limited English proficiency.
A few commenters recommended that CMS consider further linkages between
Medicaid applications and other social services. Another commenter
sought clarification about whether an individual for whom the State had
accepted self-attestation, but was later deemed ineligible would be
treated as ``enrolled'' in Medicaid for purposes of the continuous
enrollment condition under the Families First Coronavirus Response Act
(FFCRA) (Pub. L. 116-127, enacted March 18, 2020) or any subsequent
continuous enrollment conditions or requirements.
Response: These areas are outside the scope of this rulemaking.
With respect

[[Page 65247]]

to the question about the continuous eligibility condition under the
FFRCA, we note that this provision expired on March 31, 2023.
2. Define ``Family of the Size Involved'' for the Medicare Savings
Program Groups Using the Definition of ``Family Size'' in the Medicare
Part D Low-Income Subsidy Program (Sec. 435.601)
To further facilitate alignment of methodologies used to determine
eligibility for the Medicare Part D LIS and MSP groups and facilitate
enrollment in the MSPs based on LIS data, we proposed to amend Sec.
435.601 (``Application of financial eligibility methodologies'') to
create a new paragraph (e), in which we proposed to define ``family
size'' for purposes of MSP eligibility.
As discussed in the proposed rule at 87 FR 54770, the Act sets out
income limits for MSP enrollment relative to the Federal poverty level
(FPL) ``applicable to a family of the size involved.'' The statute does
not define the phrase ``family of the size involved'' and CMS has
historically permitted States to apply their own reasonable definition
of this phrase.\35\
---------------------------------------------------------------------------

\35\ Memorandum from Director, Center for Medicaid and State
Operations, to Regional Administrator, re: Medicaid Eligibility--
Policy Governing Family Size in Determining Eligibility for
Qualified Medicaid Beneficiaries and Specified Low-Income
Beneficiaries. October 2, 1997. <a href="https://www.medicaid.gov/sites/default/files/2019-12/medicaid-eligibilty-memo.pdf">https://www.medicaid.gov/sites/default/files/2019-12/medicaid-eligibilty-memo.pdf</a>.
---------------------------------------------------------------------------

However, in light of the various statutory provisions to facilitate
enrollment of LIS recipients into MSPs and vice versa, it is
appropriate to establish Federal standards governing the phrase
``family of the size involved.''
Specifically, we proposed for purposes of determining eligibility
for the MSP groups, consistent with our authority under section
1902(a)(4) of the Act to facilitate methods of administration that
promote the proper and efficient administration of the Medicaid
program, that ``family of the size involved'' be defined to include at
least the individuals included in the definition of ``family size'' in
the LIS program. Under Sec. 423.772 (``Definitions'' relating to the
LIS program), ``family size'' is defined to include the applicant, the
applicant's spouse (if the spouse is living in the same household with
the applicant), and all other individuals living in the same household
who are related to the applicant and dependent on the applicant or
applicant's spouse for one-half of their financial support.
By proposing that a State's definition of ``family of the size
involved'' include ``at least'' the individuals described in Sec.
423.772 for purposes of the MSP groups, States would retain flexibility
to include other individuals who are not described in Sec. 423.772.
Additionally, this proposal would not affect the States' ability to
adopt a different reasonable definition of the phrase for purposes of
other eligibility groups. We sought comment on this proposal to define
``family of the size involved'' for purposes of the MSP groups.
We received the following comments on our proposals related to
family size, and our responses follow.
Comment: Many commenters supported aligning the definitions of
family size for MSP with LIS. A number of these commenters specifically
noted that communities of color and marginalized individuals were more
likely to be part of multi-generational households. For that reason,
they indicated this change would better reflect the household
composition of low-income Medicare beneficiaries and promote health
equity. MACPAC supported this proposal, noting consistency with its
2020 recommendations to Congress to align the family size definition
for the MSPs and LIS.
A few commenters, while supporting the proposed change, requested
specific modifications or clarifications. A commenter requested that
CMS clarify in the regulation or commentary to the regulation that
``relative'' includes anyone related by blood, marriage, or adoption
based on 2009 CMS LIS guidance to States. The commenter further
indicated that a particular State only counts the spouse in the
household size if the individual's income is below the MSP income limit
and requested that CMS issue a directive to States to clarify this is
not allowed.
Response: We thank the commenters for their support regarding our
proposed MSP-related family size definition and agree that these
provisions would promote health equity and increase access to the MSPs.
The definition of ``family size'' in Sec. 423.772 includes the
spouse of an applicant who is living in the same household. We
therefore confirm that the requirement under the proposed rule that
States use the definition of ``family size'' in Sec. 423.772 to
determine MSP eligibility means that States would necessarily include
an applicant's spouse in the applicant's family, if the spouse is
living in the same household. We note, however, that, while being
required to include the spouse in the applicant's household, States
could exclude the spouse's income and/or resources in the applicant's
MSP eligibility determination. As noted previously in this final rule,
States may, under the authority of section 1902(r)(2)(A) of the Act,
utilize methodologies less restrictive than the SSI program in
determining MSP eligibility, which includes the authority to disregard
otherwise-countable income and/or resources, such as the income and/or
resources of a spouse.
With regard to what constitutes a relative for purposes of the
``family size'' definition in Sec. 423.772, as the commenter noted, in
2009 CMS previously confirmed for States that the LIS ``family size''
definition includes the applicant, the applicant's spouse (if living
with the applicant), and ``[a]ny persons who are related by blood,
marriage, or adoption, who are living with the applicant and spouse and
who are dependent on the applicant or spouse for at least one half of
their financial support'' \36\ (emphasis added). Consistent with this
guidance, we confirm that to comply with the proposed rule to use the
``family size'' definition in Sec. 423.772 for MSP eligibility
determinations, States would at least need to treat as ``related to''
the applicant individuals who are related by blood, marriage, or
adoption. As noted previously in this final rule, however, States would
retain the authority under the proposed rule to include individuals who
are not required to be included in the definition of a ``family of the
size involved'' for their MSP-related eligibility determinations. We
intend to consider providing future guidance to States to further
clarify this requirement.
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\36\ Centers for Medicare & Medicaid Services, Guidance to
States on the Low-Income Subsidy, section 30.6 (Family Size),
February 2009. <a href="https://www.cms.gov/Medicare/Eligibility-and-Enrollment/LowIncSubMedicarePresCov/downloads/StateLISGuidance021009.pdf">https://www.cms.gov/Medicare/Eligibility-and-Enrollment/LowIncSubMedicarePresCov/downloads/StateLISGuidance021009.pdf</a>.
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Comment: Some commenters shared concerns with the proposal to apply
the LIS family size definition to the MSPs. For example, some
commenters requested more time to complete systems changes and other
updates (for example, SPAs) to implement the proposal, and a few
commenters opposed the changes as overly burdensome and costly for
States because it would require different eligibility and enrollment
processes for the MSPs than for other non-MAGI groups. Further, some
commenters suggested that extending the LIS family size definition to
the MSPs could have an unintentional negative impact on current MSP
enrollees if additional income from the relative/dependent is deemed to
them, making them no longer eligible for the MSPs. Finally, some

[[Page 65248]]

commenters indicated that States may not have information about minor
members of household and may find it difficult to verify dependency of
non-minor household members. A few commenters questioned whether this
information about household members outside of the spousal unit is
contained in the LIS leads data transmitted.
Response: We acknowledge that these changes may require many
programmatic updates (including SPAs) and systems changes. As such, we
are extending through this final rule the timeline for States to comply
with this provision.
Regarding the concern about the deeming to MSP applicants or
enrollees the income of relatives or dependents, we note that
preexisting non-MAGI deeming rules, under section 1902(a)(17)(D) of the
Act and Sec. 435.602(a)(2)(i), prohibit States from deeming to an
applicant the income or resources of anyone who is not the spouse or
parent of that individual. Thus, although the proposal to use the
definition of ``family size'' under Sec. 423.772 to determine MSP-
related eligibility may increase the family size of MSP applicants and
enrollees, it will not expand the individuals whose income and/or
resources may be deemed available to an MSP applicant or enrollee, as
the non-MAGI deeming rule described in section 1902(a)(17)(D) of the
Act and Sec. 435.602(a)(2)(i) continues to apply.
Finally, we clarify that because the LIS definition of family size
includes dependent relatives residing in the same house, SSA collects
information to determine the number of relative dependents living in
the household, excluding the beneficiary and spouse, and includes it in
the LIS leads data sent to States.\37\ Again, as mentioned throughout,
we plan to provide technical assistance and guidance to States to help
them understand and use LIS leads data information for MSP eligibility
determinations.
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\37\ <a href="https://www.ssa.gov/dataexchange/documents/LIS%20record.pdf">https://www.ssa.gov/dataexchange/documents/LIS%20record.pdf</a>.
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After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal at Sec. 435.601 on family size, with a
modified compliance date of April 1, 2026.
3. Automatically Enroll Certain SSI Recipients Into the Qualified
Medicare Beneficiaries Group (Sec. 435.909)
SSI is a Federal cash assistance program that serves low-income
individuals who are age 65 or older, or have blindness or a disability.
SSI recipients typically qualify for other Federal and State programs.
For example, many SSI recipients are entitled to Medicare under Sec.
406.5(a) and (b). Additionally, in most States, the receipt of SSI is a
mandatory basis for Medicaid eligibility pursuant to section
1902(a)(10)(A)(i)(II)(aa) of the Act, implemented at Sec. 435.120
(``Individuals receiving SSI group,'' hereafter the ``mandatory SSI
group'').
Thirty-three States and the District of Columbia (DC) that cover
the mandatory SSI group have an agreement with SSA under section
1634(a) of the Act under which SSA completes the determination of
eligibility for the mandatory SSI group, and the Medicaid agency
automatically enrolls the individual in Medicaid. We commonly refer to
these States as ``1634 States.'' Nine States that cover the mandatory
SSI group apply the SSI program's income and resource methodologies and
disability criteria but require individuals to submit a separate
application to the State Medicaid agency (``criteria States'').
Eight States do not cover the mandatory SSI group. Instead, these
States have elected to exercise authority provided to them under
section 1902(f) of the Act to apply financial methodologies and/or
disability criteria more restrictive than the SSI program in
determining eligibility for individuals 65 years old or older or who
have blindness or a disability, subject to certain conditions. These
States are referred to as ``209(b) States,'' after the provision of
section 209(b) of the Social Security Act Amendments of 1972 (Pub. L.
92-603), which enacted the State authority codified at section 1902(f)
of the Act. The eligibility group authorized by section 1902(f) of the
Act is implemented at Sec. 435.121 (``Individuals in States using more
restrictive requirements for Medicaid than the SSI requirements,''
hereafter ``mandatory 209(b) State group'').
As discussed in the proposed rule at 87 FR 54771, because the
income and resource standards for the QMB group exceed the income and
resource standards for SSI, individuals entitled to Medicare Part A who
meet the income and resource requirements for the mandatory SSI group
or mandatory 209(b) group will always meet the income and resource
requirements for the QMB group and be eligible for the QMB group.
As discussed at 87 FR 54771, most individuals enrolled in Medicare
qualify for Part A without paying a premium (premium-free Part A) and
are automatically enrolled. According to internal SSA and CMS data, in
2022, approximately 2.8 million individuals (over 75 percent) of
Medicare-eligible SSI recipients were entitled to premium-free Part A.
Under Sec. 406.20, many individuals who are not eligible for
premium-free Part A may still enroll in Part A by applying for benefits
at SSA and paying a premium (``premium Part A''). Individuals who are
not eligible for premium-free Part A are not automatically enrolled in
premium Part A and they must enroll in Part B prior to or at the same
time as they enroll in Part A. For all Medicare beneficiaries,
enrollment in Part B is contingent on a monthly premium, which is
subject to an adjustment based on income.
All States currently have entered into a voluntary ``buy-in
agreement'' with the Secretary authorized under section 1843 of the Act
which requires them to pay the Part B premiums for certain Medicaid
beneficiaries known as ``(Part B buy-in''), including individuals
enrolled in the QMB group and those receiving SSI (as described in the
Medicare regulations at Sec. 407.42). A buy-in agreement permits
States to directly enroll eligible individuals in Medicare Part B at
any time of the year (without regard to Medicare enrollment periods or
late enrollment penalties if applicable) and to pay the Part B premiums
on the individual's behalf.
In 1634 States, when SSA determines an individual eligible for both
the mandatory SSI group and Medicare Part B, CMS automatically
initiates Part B buy-in for the individual.\38\ In SSI criteria and
209(b) States, SSA notifies both the State and CMS that an individual
has been determined eligible for SSI and Medicare Part B; however,
because such individuals must submit a separate Medicaid application
for determinations of eligibility, we do not automatically initiate
Part B buy-in. Rather, once the State determines an individual eligible
for the mandatory SSI or 209(b) group, the State must initiate Part B
buy-in for the individual pursuant to its buy-in agreement.
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\38\ States with buy-in agreements must exchange buy-in
enrollment data with CMS on a daily basis under Sec. 407.40(c)(4),
and CMS also exchanges buy-in data with SSA on a daily basis. CMS
collectively refers to these data exchange processes as the ``buy-in
data exchange.'' See Manual for the State Payment of Medicare
Premiums, chapter 2, sections 2.0 and 2.1. <a href="https://www.cms.gov/files/document/chapter-2-data-exchange-processes.pdf">https://www.cms.gov/files/document/chapter-2-data-exchange-processes.pdf</a>.
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While individuals enrolled in the mandatory SSI or 209(b) group
receive full Medicaid benefits and Part B buy-in, enrollment in the QMB
group provides these individuals with additional protection from out-
of-pocket health care costs--specifically Medicare

[[Page 65249]]

Part A premiums, if applicable, and Parts A and B cost-sharing charges.
Moreover, Federal law prohibits all Medicare providers and suppliers,
not just those participating in Medicaid, from charging QMBs for
Medicare cost-sharing.
Maximizing the number of Medicaid beneficiaries who are also
enrolled in Medicare is advantageous to such individuals, and it can
also result in cost savings for States. As a third-party payer,
Medicare pays primary to Medicaid for Medicare Part A (inpatient
hospital and skilled nursing facility services) and Medicare Part B
(outpatient medical care). In addition, Medicaid beneficiaries who are
enrolled in both Medicare Parts A and B may join Medicare-Medicaid
integrated care plans, which coordinate care across the two payers and
may generate savings to the State by helping beneficiaries avoid
institutional placement and by providing supplemental benefits, such as
dental, transportation, hearing, or other benefits that otherwise would
have been covered by Medicaid.
Despite the potential benefits for Medicaid beneficiaries and State
agencies, our data from 2022 indicates that over 500,000 or 16 percent
of SSI recipients who are eligible to enroll in Medicare are not
enrolled in the QMB eligibility group. It is our understanding that a
major barrier to QMB enrollment is that many States require SSI
recipients to file a separate application with the State Medicaid
agency to be evaluated for eligibility for the QMB group, even though
they have been determined eligible for the mandatory SSI or 209(b)
groups, and all SSI recipients who are entitled or able (with a
premium) to enroll in Part A necessarily meet the requirements for QMB
eligibility.
We proposed several changes to facilitate the enrollment of SSI
recipients into the QMB eligibility group, consistent with our
authority in section 1902(a)(4) of the Act to establish standards
promoting the proper and efficient administration of the Medicaid
program, the requirements in the January 28, 2021 Executive Order on
Strengthening Medicaid and the Affordable Care Act, the April 5, 2022
Executive Order on Continuing to Strengthen Americans' Access to
Affordable, Quality Health Coverage, and the December 13, 2021
Executive Order on Transforming Federal Customer Experience and Service
Delivery to Rebuild Trust in Government. Specifically, we proposed to
add a new paragraph (b) at Sec. 435.909 that generally would require
States to deem an individual enrolled in the mandatory SSI or 209(b)
group eligible for the QMB group the month the State becomes
responsible for paying the individual's Part B premiums under its buy-
in agreement pursuant to Sec. 407.47(b). We also proposed technical
changes to remove reserved paragraph (a) at Sec. 435.909, redesignate
Sec. 435.909 paragraph (b) as (a), and add a new header to new Sec.
435.909(a).
We noted (87 FR 54772) that under section 1902(e)(8) of the Act,
QMB eligibility is effective the month following the month in which the
determination of eligibility for the QMB group is made. Thus, under our
proposal, QMB coverage would start the month following the month the
State deems an individual eligible for the QMB group and starts paying
the individual's Part B premiums under the buy-in agreement. For
example, if an individual is first enrolled in both the mandatory SSI
or 209(b) Medicaid group and entitled to Part A in January 2025, the
State would start paying the individual's Part B premiums under the
buy-in agreement and deem the individual eligible for the QMB group in
January 2025. The individual's QMB coverage would start February 1,
2025.
SSI Recipients Who Have Premium-Free Medicare Part A
As noted at 87 FR 54771, SSA automatically enrolls individuals who
receive Social Security or railroad retirement benefits or disability
benefits for 24 months into premium-free Part A. SSA data for States
(including those with a 1634 agreement and those without a 1634
agreement) indicates whether an SSI recipient is entitled to premium-
free Part A. As discussed previously in this final rule, because all
SSI recipients meet the financial eligibility requirements for the QMB
group, proposed Sec. 435.909(b)(1)(i) would require all States to deem
SSI recipients who are determined eligible for either the mandatory SSI
group at Sec. 435.120 or the mandatory 209(b) group at Sec. 435.121
as eligible for the QMB group if they are entitled to premium-free
Medicare Part A. Under the proposed rule, when a 1634 State receives
from CMS the Part B buy-in enrollment for an SSI recipient who is
entitled to premium-free Medicare Part A, the State would automatically
enroll the individual in both the mandatory SSI group and the QMB
group; such individuals would not be required to submit a separate
application to the Medicaid agency to determine eligibility for the QMB
group.
SSI recipients in criteria States and 209(b) States must submit a
separate application to the Medicaid agency which determines
eligibility for either the mandatory SSI or the 209(b) group. Thus,
under proposed Sec. 435.909(b)(1)(i), once the State has determined an
SSI recipient eligible for the mandatory SSI or the 209(b) group, the
State also would start paying the Part B premiums for the individual
the first month they are entitled to Part A and receiving SSI-based
Medicaid and start QMB group coverage the first day of the following
month.
In some instances, individuals enrolled in the mandatory SSI or
209(b) group become retroactively entitled to premium-free Medicare
Part A based on a retroactive award of Social Security Disability
Insurance (SSDI). Under the Medicare regulations at Sec. 407.47(b),
States generally become responsible for retroactive Part B premiums for
such individuals dating back to the first month they were enrolled in
the mandatory SSI or 209(b) group and eligible for Part B.\39\ In the
proposed rule entitled, ``Implementing Certain Provisions of the
Consolidated Appropriations Act and other Revisions to Medicare
Enrollment and Eligibility Rules'' (87 FR 25090) (referred to hereafter
as the ``2022 Medicare eligibility and enrollment proposed rule''), we
proposed adding a new paragraph (f) at Sec. 407.47 to limit State
liability for retroactive Part B premiums for full-benefit Medicaid
beneficiaries, including individuals receiving SSI-based Medicaid, to a
period of no greater than 36 months prior to the date of the Medicare
enrollment determination.
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\39\ Individuals who are entitled to premium-free Part A are
eligible to enroll in Medicare Part B under Sec. 407.10(a)(1).
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In the proposed rule, we proposed at Sec. 435.909(b)(3) that
retroactive QMB coverage for individuals in the mandatory SSI or 209(b)
group be limited to the same period for retroactive Part B premium
liability that was set forth in the then-proposed Sec. 407.47(f),
which we have now finalized (to take effect starting January 1, 2024)
in the 2022 Medicare eligibility and enrollment final rule. For
example, if SSA determines an individual enrolled in the mandatory SSI
or 209(b) group eligible for premium-free Part A in January 2025 with
an effective date back to January 2023, the State would deem the
individual eligible for the QMB group retroactive to January 2023.
Because coverage under the QMB group begins the month after the month
of the eligibility determination, QMB coverage in this example would be
effective February 1, 2023. Alternatively, if SSA determines an
individual enrolled in the

[[Page 65250]]

mandatory SSI or 209(b) group eligible for premium-free Part A in
January 2025 with an effective date back to January 2021, the State
would deem the individual eligible for the QMB group retroactive to
January 2022, with QMB coverage effective February 1, 2022.
Additionally, at 87 FR 54772, we reminded States that individuals
deemed eligible for Medicaid are not exempt from regularly-scheduled
renewals of Medicaid eligibility in accordance with Sec. 435.916.
However, 1634 agreement States do not need to take affirmative steps to
renew Medicaid for individuals who continue to receive SSI. Such
individuals remain eligible for Medicaid based on their continued
receipt of SSI. 1634 States can rely on information electronically
transmitted by SSA (for example, the State Data Exchange (``SDX), State
Verification Exchange System (SVES), or State Online Query System
(SOLQ)), to renew on an ex parte basis, individuals who continue to
receive SSI. States may consider SSA's original notification
identifying an SSI recipient as verification that the individual is
still receiving SSI and eligible for Medicaid on that basis until the
State receives new information from SSA reflecting a change in
circumstances. However, for an individual eligible under both the
mandatory SSI and QMB groups, the State need only verify that the
individual still receives SSI and is entitled to Medicare Part A to
renew their eligibility in both groups. When an individual no longer
meets the eligibility requirements for the eligibility group under
which they have been receiving coverage, the State must determine
eligibility on all bases before terminating eligibility.
We received the following comments, and our responses follow.
Comment: Several commenters expressed support for our proposal at
Sec. 435.909(b)(1) to require States to automatically enroll most SSI
recipients in the QMB group as they are by definition eligible for this
coverage. MACPAC stated that the proposal aligns with its goal of
improving participation in the MSPs and, from a health equity
perspective, could promote access to care for the lowest-income
Medicare beneficiaries by improving their access to Medicare cost-
sharing assistance. Similarly, some commenters anticipated that our
proposal would substantially boost MSP enrollment for SSI recipients
because procedural barriers to the MSPs have an outsize impact on this
population, who are among those least able to navigate enrollment
processes due to multiple social risk factors and physical and mental
disabilities. Finally, a few commenters indicated that this proposal
would reduce administrative work for State Medicaid staff and thus
benefit States and SSI recipients alike.
Response: We agree that requiring automatic enrollment of certain
SSI recipients in QMB is an impactful and efficient step to break down
barriers to MSP enrollment and advance health equity for this extremely
low-income, high-need population.
Comment: Commenters provided differing perspectives about the time
and effort needed for States to comply with this provision. One
commenter noted that a certain State already has plans to automate QMB
enrollment for SSI recipients in late 2023, while another commenter
described another State as equipped to make system updates within 30
days of a final rule's effective date. In contrast, one commenter
contended that the proposal, particularly its creation of a limited
retroactive QMB benefit for individuals who become retroactively
entitled to premium-free Part A, may require changes in State law,
lengthy and complicated systems changes, and employee training.
Response: As noted in section II.A.1. of this final rule, we
recognize that effectuating this change may require States to update to
their systems and/or State laws, and that unique circumstances may
affect the timeline by which States can make these changes. However,
relative to other types of eligibility changes (such as implementing
provisions leveraging use of LIS leads data discussed in section
II.A.1. of this final rule and aligning non-MAGI enrollment and renewal
requirements with MAGI requirement discussed in the proposed rule at 87
FR 54780), this proposal is less likely to require complex and lengthy
systems updates. Plus, we believe that since all SSI recipients are
eligible for the QMB group, it is appropriate to provide access to this
vitally important benefit as soon as possible. In addition, under all
State buy-in agreements, States must already have mechanisms in place
to provide a period of retroactive Part B buy-in for SSI recipients who
become retroactively entitled to premium-free Part A based on a
retroactive SSDI award under Sec. 407.47(b) and (f). We anticipate
that States would build upon these processes to retroactively deem SSI
recipients into the QMB group as well. To balance the likelihood of
modest systems updates and the benefits of our proposal, we are
adopting a modified compliance date of October 1, 2024.
Comment: One commenter agreed the proposal would help beneficiaries
and States but requested clarification on whether SSI recipients have
the option to decline QMB and, if so, whether declining QMB would
affect their overall eligibility for Medicaid.
Response: Under Sec. 435.404, individuals who may be eligible
under more than one category may have their Medicaid eligibility
determined under the category they select. This means that individuals
who may be eligible for QMB and another eligibility group may choose to
have eligibility determined only under one category. Therefore, SSI
recipients can decline eligibility for QMB coverage without it
impacting their eligibility for other Medicaid groups. However, we note
that even if SSI recipients eligible for the mandatory SSI or 209(b)
group opt out of the QMB group, States would still pay their Part B
premiums under their State buy-in agreements because this is a
mandatory population for buy-in, and buy-in is involuntary. See
Sec. Sec. 407.40(c)(1) and 407.42(b). Because declining QMB
eligibility could expose these very low-income individuals to high
Medicare cost-sharing, we would expect very few SSI recipients to opt
out of QMB eligibility.
Additionally, while SSI recipients (and other individuals) may
decline QMB enrollment without it impacting their Medicaid eligibility
for other eligibility groups, they may still be required to apply for
Medicare (if they have not already done so) where States have elected
under their State plans to require Medicaid applicants and
beneficiaries to apply for Medicare as a condition of Medicaid
eligibility.
Comment: One commenter noted that CMS did not provide evidence to
justify the need for automatic enrollment and requested that CMS
withdraw this proposal and instead develop a pilot with States to
determine the reasons why eligible individuals do not apply for
benefits. The commenter also questioned whether the proposal would
inappropriately limit State flexibility to enroll SSI recipients in the
medically needy eligibility group.
Response: We decline the recommendation for a pilot project. As
explained in the proposed rule (87 FR 54761 through 54762), our
engagement with States and other interested parties \40\ as well as
numerous other

[[Page 65251]]

studies \41\ have demonstrated that burdensome documentation
requirements hinder the ability of eligible individuals to enroll in
the MSPs and that easing these requirements is key to ensuring
individuals can obtain these benefits. Automating QMB enrollment
removes the need for this low-income, high-need population to undergo a
redundant application process.
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\40\ See for example, CMS Office of Burden Reduction & Health
Informatics, ``Navigating the Medicare Savings Program (MSP)
Eligibility Experience'' April 2022. <a href="https://www.cms.gov/files/document/navigatingmedicare-savings-program-msp-eligibilityexperience-journey-map.pdf">https://www.cms.gov/files/document/navigatingmedicare-savings-program-msp-eligibilityexperience-journey-map.pdf</a>.
\41\ See, for example, MACPAC, ``Improving Participation in the
Medicare Savings Programs,'' Report to Congress, June 2020. <a href="https://www.macpac.gov/publication/chapter-3-improving-participation-in-the-medicare-savings-programs/">https://www.macpac.gov/publication/chapter-3-improving-participation-in-the-medicare-savings-programs/</a>; Office of the Assistant Secretary for
Planning and Evaluation, Loss of Medicare-Medicaid Dual Eligible
Status: Frequency, Contributing Factors, and Implications, May 8,
2019. <a href="https://aspe.hhs.gov/basic-report/loss-medicare-medicaid-dual-eligible-status-frequency-contributing-factors-and-implications">https://aspe.hhs.gov/basic-report/loss-medicare-medicaid-dual-eligible-status-frequency-contributing-factors-and-implications</a>; and
Caswell, Kyle J., and Timothy A. Waidmann, ``Medicare Savings
Program Enrollees and Eligible Non-Enrollees,'' The Urban Institute,
June 2017. <a href="https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf">https://www.macpac.gov/wp-content/uploads/2017/08/MSP-Enrollees-and-Eligible-Non-Enrollees.pdf</a>.
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Separately, we note that 209(b) States that have elected to extend
eligibility to medically needy individuals under Sec. 435.330
(``Medically needy coverage of the aged, blind, and disabled in States
using more restrictive eligibility requirements for Medicaid than those
used under SSI'') do not have the flexibility to enroll SSI recipients
who meet a spenddown in a medically needy group. Under section 1902(f)
of the Act and Sec. 435.121(e)(5), SSI recipients (and certain other
individuals) who meet a spenddown based on the deduction of incurred
medical expenses must be treated as categorically needy.
Comment: Many commenters expressed support for the proposed changes
but provided feedback on areas that were not addressed in the proposed
rule. For example, many commenters requested that CMS require all
States to automatically enroll SSI recipients in Medicaid coverage. One
commenter recommended that CMS work with other agencies to streamline
processes for enrolling Medicaid beneficiaries in other Federal
benefits, when there is data indicating that there is a high likelihood
that Medicaid beneficiaries would be eligible for those other Federal
benefits.
Response: We thank the commenter for their support of the proposed
changes but note that these comments are outside the scope of this
rulemaking.
After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing our proposal to require States to deem individuals enrolled
in the mandatory SSI or 209(b) group who have premium-free Medicare
Part A as eligible for the QMB group under new Sec. 435.909(b)(1),
with a modified compliance date of October 1, 2024 to allow States more
time for implementation.
QMB Eligibility for Individuals Eligible for Premium Part A
As we noted previously in this final rule and in the proposed rule
(87 FR 54772), individuals age 65 and over who lack the sufficient work
history for premium-free Part A may qualify to pay, or have paid on
their behalf, a monthly premium to receive Medicare Part A
benefits.42 43
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\42\ Note that all individuals receiving title II benefits based
on disability who have met the 24-month waiting period to enroll in
Medicare are entitled to premium-free Part A.
\43\ To meet the requirements for premium Part A at Sec.
406.20(b), the individual must be: age 65 or older, a U.S. resident,
not otherwise entitled to Part A, entitled to Part B or in the
process of enrolling in it, and a U.S. citizen or lawful permanent
resident who has resided in the U.S. continuously during the 5 years
immediately preceding the month they enrolled in Medicare.
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All States must pay the Part A premium for individuals who are
enrolled in the QMB eligibility group. However, as discussed in the
proposed rule at 87 FR 54773, States can choose one of two methods to
pay the Part A premium for QMBs.\44\ First, States can expand their
buy-in agreement with us under section 1818(g) of the Act to include
enrollment and payment of Part A premiums for QMBs who do not have
premium-free Part A. Currently, 36 States and the District of Columbia
have chosen this option and are called ``Part A buy-in States.'' In
Part A buy-in States, individuals determined eligible for the QMB group
can enroll in premium Part A at any time of the year and without regard
to late enrollment penalties. Fourteen States do not include Part A in
their buy-in agreements and instead pay the Part A premiums for QMBs
using a group payer arrangement, which allows certain third parties
(for example, States) to pay the Part A premiums for a class of
beneficiaries.\45\ States that use a group payer arrangement for QMBs
are known as ``Part A group payer States.''
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\44\ See chapter 1, section 1.7 of the CMS Manual for the State
Payment of Medicare Premiums. <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>.
\45\ See SSA Program Operations Manual System (POMS) HI
01001.230 Group Collection-General. <a href="http://policynet.ba.ssa.gov/poms.nsf/lnx/0601001230">http://policynet.ba.ssa.gov/poms.nsf/lnx/0601001230</a>.
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As previously noted, to qualify for the QMB eligibility group under
section 1905(p)(1) of the Act, an individual must be entitled to
hospital insurance benefits under Part A of title XVIII. In general, an
individual becomes entitled to Part A if: (1) they are eligible for
premium-free Part A based on payment of a payroll tax; or (2) are
eligible to enroll in premium Part A and do enroll (creating a Part A
premium obligation).
Further, as noted in the proposed rule at 87 FR 54773, section
1905(a) of the Act specifies that payments of Medicare cost-sharing for
QMBs (including Part A premiums) are ``medical assistance'' for
purposes of FFP, if made in the month following the month in which the
individual becomes a QMB. Thus, under a literal reading of the words of
the statute, a State would not be able to claim or receive FFP under
the QMB group for an individual without Premium-free Part A until the
month after the month in which the individual is ``entitled to Part
A,'' which would require that a Part A premium be billed to the
individual until QMB coverage of the premium would begin. This would
create a ``catch 22'' in which low-income individuals without premium-
free Part A could only be eligible for QMB coverage that makes Part A
enrollment affordable if they first became personally liable for the
high cost of paying the Part A premium to become ``entitled'' to Part
A, and thus eligible for QMB status.
As we explained in the proposed rule at 87 FR 54773, this result
would eviscerate the purpose of sections 1843 and 1818(g) of the Act
(``buy-in statute'') to avoid undue delays in QMB enrollment. Under a
literal reading, States with a Part A buy-in agreement could
theoretically use only 100 percent State funds to pay Part A premiums
the first month to allow the individual to become entitled to Part A
and start QMB coverage the next month. However, in Harris v. McCrae,
448 U.S. 297 (1980), the U.S. Supreme Court held that States cannot be
required to provide Medicaid using only State funds. Further, while
individuals can enroll in Part A at any time of the year without regard
for Medicare enrollment periods or applicable late enrollment penalties
if the State pays their Part A premium under its buy-in agreement, this
is not the case for individuals who are paying the premium themselves.
Individuals who must pay the Part A premium themselves must wait until
a Medicare enrollment period to enroll in Part A and may be subject to
late enrollment penalties. Thus, a literal read of the statute would
defeat the purpose of buy-in statute--to avoid delays in QMB enrollment
by allowing QMB-eligible individuals who reside in Part A buy-in States
to enroll in Part A at any time of the year, without the imposition of
Medicare enrollment penalties.

[[Page 65252]]

Recognizing that a literal read of the statute would produce a
result that essentially nullifies the impact of the QMB and buy-in
statutory provisions, we instituted a policy over 30 years ago under
which States can receive FFP for paying an individual's Part A premium
the first month of entitlement, thereby triggering both Part A
entitlement and QMB coverage. Under this longstanding policy, Part A
buy-in States can determine an individual eligible for QMB status, and
thus for their Part A premiums to be paid, if they are enrolled in Part
B but not yet entitled to Part A.\46\ Group payer States similarly can
approve eligibility for individuals under the QMB eligibility group if
SSA has determined them conditionally eligible for premium Part A,
through a process known as ``conditional enrollment.'' The conditional
enrollment process enables low-income individuals to apply at SSA for
premium Part A on the condition that they will only be enrolled in Part
A if the State determines they would become eligible for the QMB group
upon payment of the Part A premium.\47\
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\46\ Chapter 1, section 1.10 of the CMS Manual for the State
Payment of Medicare Premiums, <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>, and SSA POMS HI
00801.140.C Premium Part A Enrollments for Qualified Medicare
Beneficiaries (QMBs)--Part A Buy-In States and Group Payer States.
<a href="http://policynet.ba.ssa.gov/poms.nsf/lnx/0600801140">http://policynet.ba.ssa.gov/poms.nsf/lnx/0600801140</a>.
\47\ The conditional enrollment process is described in chapter
1, section 1.11 of the CMS Manual for the State Payment of Medicare
Premiums, <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>, and in SSA POMS HI 00801.140 Premium Part A
Enrollments for Qualified Medicare Beneficiaries (QMBs)--Part A Buy-
In States and Group Payer States. <a href="http://policynet.ba.ssa.gov/poms.nsf/lnx/0600801140">http://policynet.ba.ssa.gov/poms.nsf/lnx/0600801140</a>.
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For multiple decades, the conditional enrollment policy has helped
hundreds of thousands of individuals, many of whom are poorer and more
likely to be non-native English speakers, to obtain essential
assistance with Medicare premiums and cost-sharing by allowing States
to pay the first month's premium needed to trigger Medicare Part A
entitlement (note that they do not actually become ``entitled'' to Part
A until this payment is made). Without this policy, the subsidies
available under the QMB group to make Part A affordable would only be
available to individuals who somehow found a way to pay the initial
Part A premium (including a late enrollment penalty if applicable)
themselves.
We proposed to amend the regulations to reflect the foregoing
longstanding approach to implementing the statute in a manner that
gives full effect to our understanding of the law's intended policy in
this rare instance in which implementing the plain meaning of the words
of the statute would produce a result that is at odds with this
statutory purpose. As noted in the proposed rule at 87 FR 54774 through
54775, this approach is consistent with United States v. Ron Pair
Enterprises, Inc., 489 U.S. 235 (1989) and other court opinions. We
noted at 87 FR 54774 through 54775 that there also is CMS precedent for
not applying the plain meaning of the words of the statute when it
leads to an absurd result contrary to our understanding of the purpose
of the statute.
For the reasons set forth previously in this final rule, in this
case also, reversing our decades-long method of implementing the
statute to instead apply the plain meaning of the words literally would
be contrary to the fundamental purpose of the QMB statutory provisions.
Therefore, as noted previously in this final rule, we proposed to
incorporate in the regulations our longstanding practice of providing
FFP for State payments of the first month of an individual's Part A
premium for individuals who are eligible for the QMB group based on
enrollment in Part B in Part A buy-in States or conditional enrollment
in Part A in group payer States. This also would facilitate enrollment
into the QMB group for SSI recipients who need to pay a premium to
enroll in Part A.
We received comments on our proposed incorporation of this
longstanding policy into regulations, and our responses follow.
Comment: Several commenters expressly supported our proposal to
codify our decades-old practice of paying Federal matching funds to
States that pay the first month's Part A premium for individuals
eligible for the QMB group in Part A buy-in and group payer States,
while no commenters opposed it. They concurred that a literal read of
the relevant statutory provisions would create a ``catch-22'' in which
low-income individuals cannot obtain QMB coverage that makes it
affordable to enroll in Medicare until they become liable for the Part
A premiums. They indicated that CMS's longstanding method of
implementing the statute has helped to prevent a substantial financial
barrier that is wholly inconsistent with the purpose of QMB statute. A
commenter expressed hope that codifying the longstanding workaround
will prompt the few Part A group payer States that have not yet
recognized conditional Part A enrollments to now accept them as a valid
basis for QMB eligibility.
Response: We thank the commenters for their support of the proposal
to codify our longstanding practice to facilitate QMB enrollment for
individuals without premium-free Part A. Over 700,000 individuals
without premium-free Part A are currently enrolled in the QMB group. As
indicated at 87 FR 54760 we estimated that if CMS were to remove this
work-around, over 78,000 individuals without premium-free Part A each
year would be prevented from enrolling in the QMB group. We anticipate
that codification will provide additional clarity to States,
beneficiaries, and organizations that assist them.
After considering the comments we received and for the reasons
outlined in the proposed rule and our responses to comments, we are
finalizing without modification our proposal to codify our existing
practice allowing States to receive Federal matching funds for the
payment of Part A premiums the first month an individual is entitled to
premium Part A.
SSI Recipients Eligible for Premium Part A
Based on the longstanding policy described previously in this final
rule, in Part A buy-in States, when an SSI recipient who lacks
sufficient work history for premium-free Part A has been determined
eligible for the mandatory SSI or 209(b) group and is enrolled in Part
B, the State can determine the individual eligible for the QMB
eligibility group and enroll the individual in Part A buy-in.
To streamline QMB enrollment for SSI recipients who must pay a
premium to enroll in Part A, we proposed at Sec. 435.909(b)(1)(ii) to
require Part A buy-in States to deem those individuals who are
determined eligible for the mandatory SSI or 209(b) groups as eligible
for the QMB group and initiate their enrollment into Medicare Part A
the month they are enrolled in Part B buy-in.
In Part A buy-in States with a 1634 agreement, once the State
receives the automated Part B buy-in enrollment from CMS for an SSI
recipient who lacks a sufficient work history for premium-free Part A,
under proposed Sec. 435.909(b)(1)(ii) the State would enroll the
individual in the mandatory SSI group, deem the individual eligible for
the QMB group, and effectuate enrollment in Medicare Part A through the
buy-in agreement.
In a Part A buy-in State without a 1634 agreement (that is, a
criteria or 209(b) State), once the individual applies to the Medicaid
agency, some States currently only determine

[[Page 65253]]

eligibility for the mandatory SSI or 209(b) group, as applicable, and
initiate Part B enrollment per their buy-in agreement. Under proposed
Sec. 435.909(b)(1)(ii), these Part A buy-in States also would be
required to deem any individuals determined by the State to be eligible
for the mandatory SSI or 209(b) groups as eligible for the QMB group
and initiate enrollment in both Medicare Part A and Part B buy-in.
In the 14 group payer States, it is more challenging for SSI
recipients to enroll in Medicare Part A and the QMB eligibility group.
Unlike in Part A buy-in States, individuals determined eligible for the
mandatory SSI or 209(b) group in group payer States who are enrolled in
Part B pursuant to the State's buy-in agreement will not necessarily
satisfy the eligibility requirement for the QMB group that the
individual be entitled to Part A. Even though the State will initiate
enrollment of the individual in Part B, pursuant to its buy-in
agreement, it will not cover the individual's Part A premium or
initiate Part A enrollment under the buy-in agreement. Instead, the
individual must separately apply for premium Part A at SSA using the
conditional enrollment process, which is administratively burdensome
for both individuals and the State, and the vast majority of
individuals fail to complete the process unless an eligibility worker
or other application assistor provides hands-on assistance
throughout.\48\
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\48\ Medicare Rights Center,``Streamlining Medicare and QMB
Enrollment for New Yorkers: Medicare Part A Buy-In Analysis and
Policy Recommendations,'' February 2011. <a href="https://www.medicarerights.org/pdf/Part-A-Buy-In-Analysis.pdf">https://www.medicarerights.org/pdf/Part-A-Buy-In-Analysis.pdf</a>.
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Two other challenges currently make QMB enrollment harder for SSI
recipients without premium-free Part A in group payer States. First,
group payer States can only enroll individuals in premium Part A during
the general Medicare enrollment period that runs from January through
March each year. Second, group payer States are required to pay late
enrollment penalties, if applicable, for those Medicaid beneficiaries
who did not enroll in Medicare Part A timely when they first became
eligible to do so.
To streamline QMB enrollment for SSI recipients without premium-
free Part A in group payer States, we proposed to add a State option
for deeming individuals eligible for the QMB group. Specifically,
proposed Sec. 435.909(b)(2) would allow, but not require, group payer
States to directly initiate Medicare Part A enrollment for individuals
who are not entitled to premium-free Part A without first sending them
to SSA to apply for conditional Part A enrollment. Under this proposed
State option, once the State has determined the individual eligible for
the mandatory SSI or 209(b) group and become liable for paying their
Part B premiums under the buy-in agreement pursuant to Sec. 407.42,
the State would also be able to deem them eligible for the QMB group.
We received the following comments, and our responses follow.
Comment: Several commenters supported our proposal to require Part
A buy-in States to deem as eligible for the QMB group certain SSI
recipients who must pay a premium to enroll in Part A because it would
meaningfully improve the ability of this low-income, at-risk population
to access the benefits for which they qualify and that they distinctly
need.
Response: We thank commenters for their support. We anticipate it
will measurably increase the number of SSI recipients without premium-
free Part A who participate in the QMB group.
Comment: Some commenters sought clarifications about our proposals
to require QMB deeming in Part A buy-in States and allow it in group
payer States. A few commenters questioned whether our proposal would
require States to deem SSI recipients without premium-free Part A into
the QMB eligibility group retroactively. One commenter inquired whether
Federal statute permits retroactive coverage of Medicare Part A
premiums or allows States to provide retroactive Part A buy-in coverage
to SSI recipients, but not other QMB-eligible individuals. Another
commenter inquired whether the proposal would require States to modify
their systems to enroll SSI recipients in Part A buy-in. The commenter
went on to question whether Part A buy-in States would need to align
the QMB start date with the individual's Part A enrollment during the
GEP and whether individuals who lose Part A buy-in may be required to
pay late enrollment penalties. The commenter also noted that
streamlining QMB enrollment processes for non-SSI recipients who
qualify for premium Part A, including non-citizens, is equally
important and suggested that CMS consider facilitating QMB enrollment
for this population. The commenter indicated that LIS leads data would
not include records for such individuals.
Response: At the outset, we clarify that our proposal would not
permit States to retroactively enroll SSI recipients in Part A buy-in
since, under section 1902(e)(8) of the Act, QMB coverage is effective
the month following ``the month in which the [QMB] determination first
occurs'' (that is, the month the State deems the SSI recipient eligible
for the QMB group). For individuals who lack premium-free Part A,
deeming would occur the month they are enrolled in the mandatory SSI or
209(b) group and Part A buy-in, and QMB coverage would start the month
following the deeming month. For example, if an individual were
enrolled in the mandatory SSI or 209(b) group and Part B buy-in in
April 2025, the State would deem the individual eligible for QMB in
April 2025, with Part A buy-in and QMB coverage effective May 1, 2025.
As explained at 87 FR 54772 and in our comment response in this final
rule, States would only deem individuals eligible for QMB coverage
during a past period if they are eligible for the mandatory SSI or
209(b) group and are retroactively determined eligible for premium-free
Part A due to a delayed SSDI award.
In addition, we anticipate that States may need to modify their
processes and systems to enroll SSI recipients in Part A buy-in the
month after they are deemed eligible for QMB and expect that the nature
and design of operations and system changes will vary by State. We are
available to provide technical assistance to States as they make
operational and systems changes to implement this proposal.
We clarify that Part A buy-in States would deem SSI recipients in
QMB and enroll them in Part A buy-in throughout the year, not just
during the GEP, since individuals covered under State buy-in agreements
are not subject to Medicare enrollment periods. Further, we clarify
that while residents of group payer States who lose eligibility for
Part A buy-in may be subject to a late enrollment penalty, residents of
Part A buy-in States who lose Part A buy-in are not liable for a late
enrollment penalty even if they had been paying one prior to enrollment
in Part A buy-in.\49\
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\49\ CMS Manual for the State Payment of Medicare Premiums,
chapter 1, section 1.15. <a href="https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf">https://www.cms.gov/files/document/chapter-1-program-overview-and-policy.pdf</a>.
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Finally, we agree with the importance of simplifying QMB enrollment
for individuals who are not entitled to SSI and lack premium-free Part
A, many of whom are otherwise ineligible for Medicaid coverage and
would solely rely on Medicare for health insurance. As such, we may
consider whether a basis exists to streamline QMB enrollment for non-
SSI recipients who lack premium-free Part A in future rulemaking. We
are also available to explore with States options to streamline their
current QMB eligibility and enrollment processes for this

[[Page 65254]]

population. We also clarify that LIS leads data may include records for
non-SSI recipients who lack premium-free Part A, do not already have
Medicaid, and have applied for LIS.
Comment: Many commenters supported our proposal to permit group
payer States to deem SSI recipients without Part A eligible for QMB by
employing processes used by Part A buy-in States to directly initiate
Part A entitlement for individuals enrolled in Part B (avoiding the
need to first send them to SSA to enroll in conditional Part A). They
agreed that it would significantly simplify QMB enrollment for
beneficiaries and promote administrative efficiencies for States. A few
commenters supported keeping this an option rather than a requirement
because increasing QMB enrollment through streamlined processes could
increase States costs and require systems updates.
Other commenters urged CMS to require group payer States to bypass
the conditional enrollment process, citing numerous challenges arising
from this process. These commenters indicated that the complexity of
the conditional enrollment process presents an almost insurmountable
obstacle for SSI recipients, who are among those least able to navigate
complex application processes. They contended that requiring the lowest
income, high needs older adults to first apply for conditional Part A
at a separate agency is unrealistic and unfair and that getting lost in
the process is the rule rather than the exception for those who lack
assistance from an advocate, particularly for individuals with limited
English proficiency and low literacy skills. They explained that having
to wait until the GEP to file a conditional enrollment further
complicates and delays the process. Some commenters noted that SSI
recipients in States with group payer and 209(b) status face the
steepest obstacles to obtain the benefits to which they are entitled
because they must file an application for the 209(b) eligibility group
with their State before completing the two-step application process to
enroll in QMB. Some commenters stated that, despite the release of
clearer program instructions to SSA field offices, government offices
commonly provide incorrect information about the process or fail to
properly enroll individuals in benefits. One commenter suggested that
CMS has legal authority to mandate that group payer States deem SSI
recipients without premium-free Part A eligible for QMB because doing
so would still leave the administrative Part A group payment option
intact. Finally, another commenter requested that CMS require the
remaining group payer States to convert to Part A buy-in status since a
particular group payer State has not voluntarily taken that step
despite requests from interested parties.
Response: We appreciate the

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