a. Background

The definition of a specified excluded individual at section 1902(xx)(9)(A)(ii)(V) of the Act includes an individual who is medically frail or otherwise has special medical needs (henceforth referred to as medically frail). Specifically, section 1902(xx)(9)(A)(ii)(V) of the Act provides that specified excluded individuals must include an individual, “(V) who is medically frail or otherwise has special medical needs (as defined by the Secretary), including an individual—(aa) who is blind or disabled (as defined in section 1614 of the Act); (bb) with a substance use disorder (SUD); (cc) with a disabling mental disorder; (dd) with a physical, intellectual or developmental disability that significantly impairs their ability to perform 1 or more ADLs; or (ee) with a serious or complex medical condition.” We are defining medically frail individuals as individuals who meet one or more of the five categories identified at section 1902(xx)(9)(A)(ii)(V) of the Act. As described in more detail in section II.E.5.b. of this IFC, at § 435.554(c)(5) we define medically frail individuals for the purposes of the community engagement exclusion.

The community engagement requirement has the potential to empower Medicaid beneficiaries through employment, education, or volunteer service so they can escape isolation and dependency, build confidence, achieve self-sufficiency and prosperity, and improve health. However, this mandatory exclusion from the community engagement requirement protects access to necessary health care services for individuals who are medically frail and may have physical or behavioral health conditions that significantly impair their ability to consistently work or participate in other community engagement activities defined at § 435.552.

Section 1937(a)(2)(B)(vi) of the Act exempts individuals who are medically frail, including individuals eligible under the State plan adult group, from mandatory enrollment in a benchmark or benchmark-equivalent benefit package (which we refer to as an alternative benefit plan (ABP)), that does not offer all services at the same or higher amount, duration, and scope covered under the State's traditional Medicaid State plan. We are not adopting the ABP medically frail definition for purposes of the community engagement medically frail exclusion for the reasons stated in this section of the preamble. While the medically frail exclusions for purposes of ABP and community engagement both apply to individuals eligible under the adult group, they are distinct from each other in that they are in two different sections of the statute that apply to different aspects of the Medicaid program. The medically frail exclusion for the ABP only impacts an individual's Medicaid benefit package selection, while the medically frail exclusion under the community engagement requirement determines if an individual needs to demonstrate community engagement to maintain Medicaid eligibility.

Section 1937(a)(2)(B)(vi) of the Act provides that individuals who are medically frail should be identified in accordance with regulations issued by the Secretary. That regulation, § 440.315(f), provides that States must identify individuals who are medically frail for purposes of the ABP requirements, and that the State's definition for that purpose must at least include those individuals described in § 438.50(d)(3), individuals with disabling mental disorders (including children with serious emotional disturbances and adults with serious mental illness), individuals with chronic SUDs, individuals with serious and complex medical conditions, individuals with a physical, intellectual or developmental disability that significantly impairs their ability to perform one or more ADLs, or individuals with a disability determination based on Social Security criteria or in States that apply more restrictive criteria than the SSI [ 59 ] program, the State plan criteria. [ 60 ]

The ABP definition of medically frail at § 440.315(f) is very similar to the community engagement medically frail definition at section 1902(xx)(9)(A)(ii)(V) of the Act. However, unlike the definition at § 440.315(f), the community engagement medically frail definition specifically includes blind individuals; uses the term “or” instead of “and” for individuals with serious or complex medical conditions; does not include children under the age of 19 described at § 438.50(d)(3); does not make reference to children with serious emotional disturbances and adults with serious mental illness to further describe individuals with disabling mental disorders; does not use the term “chronic” for individuals with SUDs; and does not include individuals with a disability determination based on ( printed page 33373) more restrictive criteria than the SSI program under a State plan.

We are not changing the ABP definition of medically frail and are specifying at § 435.554(c)(5) a separate but similar definition of medically frail for community engagement purposes in this IFC. States continue to have the discretion to include categories of individuals who are not described at § 440.315(f) in their definition of medically frail for purposes of benefit package selection.

Section 1902(xx)(9)(A)(ii)(V) of the Act provides the Secretary with the authority to define the term medically frail for community engagement purposes (as long as the definition includes the five categories specified at section 1902(xx)(9)(A)(ii)(V) of the Act). We are not using our authority at section 1902(xx)(9)(A)(ii)(V) of the Act to add additional categories to the definition of medically frail, as we have not identified any other populations that we believe could reasonably be considered medically frail outside of the five categories identified at section 1902(xx)(9)(A)(ii)(V) of the Act.

Further, unlike medical frailty implemented in ABPs, we are not providing States with the option to add additional categories of people to the definition of medical frailty for community engagement purposes. We considered doing so; however, as we state in the prior paragraph, we are not aware of a category of people that could not reasonably fall under one of the five categories identified at section 1902(xx)(9)(A)(ii)(V) of the Act. We are concerned that there may be more of an incentive for some States to include individuals who would not reasonably be considered medically frail, if we provided States with the option to add additional categories of people to the community engagement medically frail definition. For example, we do not believe it would be reasonable for States to consider an individual who is homeless as medically frail solely on the basis that the individual is homeless, as that circumstance is not a medical condition. However, individuals who are homeless may have a medical condition, such as an SUD or disabling mental disorder, that could qualify them for the medically frail exclusion. Furthermore, we believe that having a standard medically frail definition provides States with a more streamlined approach to medical frailty that will be easier to implement. If we permitted States to add additional categories to the definition of medically frail beyond those identified in the statute, then we would need to establish a process for review and approval of such categories, which would create burden for both CMS and States. We therefore do not believe limiting the definition of medically frail for community engagement purposes to the five categories identified in the statute will lead to a meaningful difference in the number of individuals who are subject to the community engagement requirement that cannot also meet such requirements.