CMS Provides Guidance to States on ACA’s Stability Protection Provisions – Say Ahhh! A Children’s Health Policy Blog

Today, CMS issued a letter and a frequently asked
questions document that outlines how the Administration will work with states
to implement the Affordable Care Act’s stability protections.  As readers of Say Ahhh! know, a number
of Republican Governors have been pressuring HHS to relax these stability
protection or “maintenance of effort” provisions so that they can reduce
Medicaid and CHIP expenditures by covering fewer people.  The guidance
issued today is good news for families seeking to gain solid footing after
tough economic times.  

The Administration’s action protects coverage for
children and families by drawing on already-established rules from nearly
identical “maintenance-of-effort” provisions included in the American Recovery
and Reinvestment Act.  It advises states against attempts to cut children
and others off coverage by slashing eligibility or by using “backdoor”
strategies to create roadblocks to coverage through red-tape and paperwork

The stability protections or maintenance-of-effort
provisions included in the Affordable Care Act require states to maintain the
eligibility rules that were in place when the law took effect on March 23,
2010.  The stability protections
cover adults until 2014 and children through 2019.  ARRA also included stability protections in exchange for
increased federal matching funds to help states meet their obligations during
the Recession.

The letter issued by CMS today indicates that they will
follow rules already established to implement the stability protections
included in the Recovery Act unless otherwise noted.  These rules preclude states from: 

  •  Eliminating Medicaid for an entire category of people
    covered at state option;
  •  Lowering the income threshold for Medicaid coverage,
    making fewer people eligible;
  • Eliminating a state’s CHIP program or scaling back
    income eligibility thresholds to make fewer children eligible
  • Imposing a new asset test in Medicaid or CHIP;
  •  Imposing new requirements for families to renew their
    coverage more frequently; or
  •  Imposing a new requirement for families to conduct a
    face-to-face interview instead of allowing mail-in or on-line applications.

In a few instances, the guidance addresses new issues
that arise out of difference between the Recovery Act’s provisions and those
included in the Affordable Care Act.

  • Option to scale back coverage of adults above 133
    percent of the federal poverty level
    Congress explicitly gave states with budget deficits this option in the
    Affordable Care Act, which applies only to adults who are not pregnant or
  • Does not require states to renew expiring waivers.  States that have expanded Medicaid to
    people using 1115 waivers are not obligated to renew these waivers .  CMS already had articulated this policy
    in a letter to Arizona earlier this month.
  • Allowing premium increases consistent with
    .  In a divergence from
    the Recovery Act rules, states can increase premiums in Medicaid and CHIP to
    reflect inflation.  In explaining
    the divergence, CMS noted that the stability protections included in the
    Affordable Care Act are in place for a considerably longer period of time.

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