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Pennsylvania Keystones of Health Section 1115 Demonstration Approval Period: December 26, 2024 through December 31, 2029 Page 59 of 90 a. Provider rate increases that are anticipated to further strengthen access to care; b. CMS or state technical errors in the original budget neutrality formulation applied retrospectively, including, but not limited to the following: mathematical errors, such as not aging data correctly; or unintended omission of certain applicable costs of services for individual MEGs; c. Changes in federal statute or regulations, not directly associated with Medicaid, which impact expenditures; d. State legislated or regulatory change to Medicaid that significantly affects the costs of medical assistance; e. When not already accounted for under Emergency Medicaid 1115 demonstrations, cost impacts from public health emergencies; f. High cost innovative medical treatments that states are required to cover; or, g. Corrections to coverage/service estimates where there is no prior state experience (e.g., SUD) or small populations where expenditures may vary widely. 12.25. Budget Neutrality Update. The state must submit an updated budget neutrality analysis with its adjustment request, which includes the following elements: a. Projected without waiver and with waiver expenditures, estimated member months, and annual limits for each DY through the end of the approval period; and, b. Description of the rationale for the mid-course correction, including an explanation of why the request is based on changes to the state’s Medicaid expenditures that are unrelated to the demonstration and/or outside the state’s control, and/or is due to a new expenditure that is not a new demonstration-covered service or population and that is likely to further strengthen access to care. 13. MONITORING BUDGET NEUTRALITY FOR THE DEMONSTRATION 13.1. Limit on Title XIX Funding. The state will be subject to limits on the amount of federal Medicaid funding the state may receive over the course of the demonstration approval. The budget neutrality expenditure limits are based on projections of the amount of FFP that the state would likely have received in the absence of the demonstration. The limit consists of one or more Hypothetical Budget Neutrality Tests and a Supplemental HRSN Aggregate Ceiling (SHAC) Test, if applicable, as described below. CMS’s assessment of the state’s compliance with these tests will be based on the Schedule C CMS-64 Waiver Expenditure Report, which summarizes the expenditures reported by the state on the CMS-64 that pertain to the demonstration. 13.2. Risk. The budget neutrality expenditure limits are determined on either a per capita or aggregate basis as described in Table 4, Master MEG Chart and Table 5, MEG Detail for Expenditure and Member Month Reporting. If a per capita method is used, the state is at risk