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Page 2 – Dir. Tidball-Zeltinger In the previous demonstration period, South Dakota’s eligibility requirements included an upper income limit of 182 percent of the federal poverty level. With this extension, South Dakota will no longer include an upper income limit, permitting out-of-state FFCY with any income to be demonstration eligible, provided they otherwise meet all demonstration eligibility requirements described in STCs. Budget Neutrality CMS has deemed this extension of the FFCY demonstration to be budget neutral because the demonstration authority to cover the FFCY population is needed for only a temporary period, through 2030, when all FFCY will be covered via the Medicaid state plan FFCC population. Further, through monitoring budget neutrality, CMS determined that the actual experience of states’ covering out-of-state FFCY resulted in limited total expenditures and low enrollment within the demonstrations. CMS generally believes that this FFCY demonstration coverage poses minimal financial risk to the federal government since FFCY demonstration spending is miniscule across states. This decision will increase the administrative ease of maintaining FFCY demonstration coverage in South Dakota. The state will be required to report total expenditures and member months in its demonstration monitoring reports. The state must still report quarterly claims and report expenditures on the CMS 64.9 WAIVER form. Failure to report FFCY expenditures and member months will result in reinstatement of the budget neutrality requirement. Monitoring and Evaluation Consistent with the demonstration STCs, the state submitted its Interim Evaluation Report for the prior demonstration approval period with the extension application. The report indicates that the small number of beneficiaries enrolled in the demonstration are generally maintaining coverage and receiving needed medical services, and there is no evidence the demonstration has negative impacts. Consistent with CMS’s requirements for section 1115 demonstrations, and as outlined in the demonstration’s STCs, the state is required to conduct systematic monitoring and comprehensive evaluation of the demonstration per applicable CMS guidance and technical assistance. Monitoring will support tracking the state’s progress toward its demonstration goals and offer timely mitigation opportunities if results indicate any areas of concern. The state and CMS will work collaboratively to finalize a list of metrics to be reported on its demonstration’s Annual Monitoring Reports, in addition to applicable narrative and qualitative information. Furthermore, the state must develop a sound Evaluation Design to support a meaningful evaluation of the demonstration to assess whether the demonstration is effective in producing the desired outcomes for its beneficiaries as well as the state’s Medicaid program overall. Public Notice To increase the transparency of demonstration projects, section 1115(d)(1) and (2) of the Act directs the Secretary of Health & Human Services to issue regulations providing for two periods