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Page 8 – State Health Official

States have shared concerns that electing the extended postpartum coverage option could result in the application of a lower FMAP than the state could claim for individuals who would otherwise be determined newly eligible in the adult group, if not for the state’s adoption of the extended postpartum coverage option. States have expressed concern that, to make the extension of postpartum coverage financially possible for the state, the state would need to conduct a redetermination before the end of the 60-day postpartum period only to obtain information sufficient to determine whether the individual beneficiary qualifies as newly eligible so that the state may continue claiming the increased FMAP under section 1905(y) of the Act with respect to the individual. However, this redetermination would be unnecessary for purposes of establishing the individual’s eligibility for benefits and would be administratively burdensome for the individual and the state; its only purpose would be to support the state’s claiming of service expenditures at the applicable FMAP.

To support states interested in adopting the extended postpartum coverage option under the ARP without requiring that they conduct a redetermination that would be unnecessarily burdensome for beneficiaries and the state, states may use a proxy methodology to account for the proportion of individuals covered under the extended postpartum coverage option who would otherwise be eligible for coverage in the adult group and for the newly eligible FMAP under section 1905(y) of the Act. Under current law, states can claim the newly eligible FMAP for individuals if (1) the individual is eligible for the adult group under 42 C.F.R. § 435.119; (2) the individual is newly eligible, as defined in 42 C.F.R. § 433.204(a)(1); and (3) the individual is receiving benefits that meet the Alternative Benefit Plan requirements in section 1937 of the Act. States may claim the newly eligible FMAP for individuals receiving extended postpartum coverage if the state implements a CMS-approved proxy methodology to ascertain the proportion of medical assistance expenditures for beneficiaries receiving extended postpartum coverage that are for individuals who would be eligible for the adult group and qualify as newly eligible, if the state completed a redetermination. This option is available provided beneficiaries receiving extended postpartum coverage receive benefits satisfying the Alternative Benefit Plan requirements under section 1937 of the Act.

Similar to the resource proxy methodology set forth in 42 C.F.R. § 433.206(d), the extended postpartum coverage proxy methodology must identify the basis that would make an individual eligible for the adult group as newly eligible and must comprehensively describe the criteria used to determine the adjustment to the total medical assistance expenditures for individuals receiving extended postpartum coverage to identify the portion that may be claimed at the newly eligible FMAP under section 1905(y) of the Act. For example, if parents between 100 percent of the federal poverty level (FPL) and 133 percent of the FPL are newly eligible in a state, the state would need a reasonable, statistically valid method to identify the percentage of individuals receiving 12-month postpartum coverage who are between 100 and 133 percent FPL whom the state would otherwise transition to the adult group and claim newly eligible FMAP; and then apply that percentage to the total expenditures for individuals receiving 12-month postpartum coverage to claim at the newly eligible FMAP. The methodology must be auditable and based on statistically valid data. The proxy methodology would not apply to individuals who are enrolled in the adult group when they become pregnant and remain in that group through pregnancy and the postpartum period.

The contents of this document do not have the force and effect of law and are not meant to bind the public in any way, unless specifically incorporated into a contract. This document is intended only to provide clarity to the public regarding existing requirements under the law.