A. Statement of Need

The changes in this IFC are necessary to align the Code of Federal Regulations (CFR) with statutory requirements set forth by section 1902(xx) of the Act as added by section 71119 (Requirement For States To Establish Medicaid Community Engagement Requirements For Certain Individuals) of the WFTC legislation, which adds a new community engagement requirement for certain adults in Medicaid. ( printed page 33450)

The community engagement requirement has the potential to empower Medicaid beneficiaries through employment, education, or community service so they can escape isolation and dependency, build confidence, and achieve self-sufficiency and independence. States will be responsible for implementing and administering the new requirement in a manner that complies with this rule. CMS will provide oversight and monitor States' implementation of the new requirement, as well as outcomes related to community engagement.

This IFC specifies and explains:

Changes to the CFR to revert certain eligibility and enrollment regulatory provisions that were suspended due to the section 71102 moratorium and are needed to implement community engagement until October 1, 2034, with the provisions in effect prior to the 2024 Eligibility and Enrollment final rule as well as conforming amendments due to the restoration of the previous CFR;

Requirements for Medicaid applicants and beneficiaries who must demonstrate community engagement as a condition of their eligibility;

The types of qualifying activities that satisfy the community engagement requirement and the criteria to meet an exception (be deemed compliant) or specified exclusion from the requirement;

The steps States must take when they are unable to verify an applicable individual has met the community engagement requirement at application, renewal, or a more frequent periodic verification of compliance;

The notice of noncompliance States must use to inform the individual how they may make a satisfactory showing to demonstrate or be deemed as demonstrating compliance or that the individual should not be subject to the requirement, as well as how the individual can reapply for coverage if they are disenrolled;

When and how States must verify an applicable individual's compliance with the community engagement requirement and whether an individual meets an exception (for deemed compliance) or exclusion from the requirements, and the outreach and notice requirements for States;

Where States will have options in implementing the community engagement requirement; and,

Additional considerations for States and implications of the community engagement requirement for other existing ways that enable enrollment, such as presumptive eligibility, as well as demonstration projects authorized under section 1115 of the Act.

The IFC also describes implementation timing and establishes new State reporting requirements.