2. Costs

The following discussion builds on costs to States, the Federal government, and Medicaid applicants and beneficiaries that are summarized in Table 32. Costs associated with the collection of information are described in detail under section IV. of this IFC. As outlined in section IV. of this IFC, the provisions in this IFC are expected to impose additional costs given the significant eligibility changes to Medicaid. Demonstrating community engagement as a condition of Medicaid eligibility is not an entirely new policy for the Medicaid program; however, the scope and structure in this rule represents a significant expansion of such requirements. Given the expedited effective date of this rule following the passage of the WFTC legislation, we focus the cost analysis on three central parties to these changes: the Federal government, States, and Medicaid applicants and beneficiaries. We acknowledge that as these provisions are implemented and additional data become available, further cost implications may be identified that are not fully captured in this analysis. Moreover, the estimated costs of these provisions are not expected to be uniform. We expect these costs will vary based on differences among States' existing State Medicaid agency program operations and systems infrastructure, including payment delivery structures, State-specific policies, and the demographic composition of each State's Medicaid population. Additionally, these costs are expected to evolve over time as States gain implementation experience, applicant and beneficiary compliance patterns emerge, and the broader effects of the community engagement requirement become better understood.