42 CFR Part 457 — Allotments and Grants to States

PART 457—ALLOTMENTS AND GRANTS TO STATES Authority: 42 U.S.C. 1302. Source: 65 FR 33622, May 24, 2000, unless otherwise noted. Editorial Note: Nomenclature changes to part 457 appear at 75 FR 48852, Aug. 11, 2010 and 77 FR 17213, 2013. Subpart A—Introduction; State Plans for Child Health Insurance Programs and Outreach Strategies Source: 66 FR 2670, Jan. 11, 2001, unless otherwise noted. § 457.1 Program description. Title XXI of the Social Security Act, enacted in 1997 by the Balanced Budget Act, authorizes Federal grants to States for provision of child health assistance to uninsured, low-income children. The program is jointly financed by the Federal and State governments and administered by the States. Within broad Federal rules, each State decides eligible groups, types and ranges of services, payment levels for benefit coverage, and administrative and operating procedures. § 457.2 Basis and scope of subchapter D. (a) Basis. (b) Scope. § 457.10 Definitions and use of terms. For purposes of this part the following definitions apply: Actuarially sound principles Advanced payments of the premium tax credit (APTC) Affordable Insurance Exchange (Exchange) American Indian/Alaska Native (AI/AN) (1) A member of a Federally recognized Indian tribe, band, or group; (2) An Eskimo or Aleut or other Alaska Native enrolled by the Secretary of the Interior pursuant to the Alaska Native Claims Settlement Act, 43 U.S.C. 1601 et. seq.; or (3) A person who is considered by the Secretary of the Interior to be an Indian for any purpose. Applicant Application Child Child health assistance Children's Health Insurance Program (CHIP) Combination program Combined eligibility notice Comprehensive risk contract (1) Outpatient hospital services. (2) Rural health clinic services. (3) Federally Qualified Health Center (FQHC) services. (4) Other laboratory and X-ray services. (5) Nursing facility (NF) services. (6) Early and periodic screening, diagnostic, and treatment (EPSDT) services. (7) Family planning services. (8) Physician services. (9) Home health services. Coordinated content (1) The transfer of an individual's or household's electronic account to another insurance affordability program; (2) Any notice sent by the State to another insurance affordability program regarding an individual's eligibility for CHIP; (3) The potential impact, if any, of— (i) The State's determination of eligibility or ineligibility for CHIP on eligibility for another insurance affordability program; or (ii) A determination of eligibility for, or enrollment in, another insurance affordability program on an individual's eligibility for CHIP; and (iii) [Reserved] (4) The status of household members on the same application or renewal form whose eligibility is not yet determined. Cost sharing Creditable health coverage Electronic account Emergency medical condition (1) Serious jeopardy to the health of the individual or, in the case of a pregnant woman, the health of a woman or her unborn child; (2) Serious impairment of bodily function; or (3) Serious dysfunction of any bodily organ or part. Emergency services (1) Furnished by any provider qualified to furnish such services; and (2) Needed to evaluate, treat, or stabilize an emergency medical condition. Enrollee Enrollment cap Exchange appeals entity External quality review (EQR) External quality review organization (EQRO) Federal fiscal year Federally qualified HMO Fee-for-service entity Group health insurance coverage Group health plan Health benefits coverage Health care services Health insurance coverage Health insurance issuer Health maintenance organization (HMO) plan Health services initiatives Household income In lieu of service or setting (ILOS) Insurance affordability program Joint application Joint review request Low-income child Managed care entity (MCE) Managed care organization (MCO) (1) A Federally qualified HMO that meets the requirements of subpart I of part 489 of this chapter; or (2) Makes the services it provides to its CHIP enrollees as accessible (in terms of timeliness, amount, duration, and scope) as those services are to other CHIP beneficiaries within the area served by the entity and (3) Meets the solvency standards of § 438.116 of this chapter. Medicaid expansion program Optional targeted low-income child Period of presumptive eligibility Poverty line/Federal poverty level Federal Register Preexisting condition exclusion Premium assistance program Premium Lock-Out Prepaid ambulatory health plan (PAHP) (1) Provides services to enrollees under contract with the State, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates. (2) Does not provide or arrange for, and is not otherwise responsible for the provision of any inpatient hospital or institutional services for its enrollees. (3) Does not have a comprehensive risk contract. Prepaid inpatient health plan (PIHP) (1) Provides services to enrollees under contract with the State, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates. (2) Provides, arranges for, or otherwise has responsibility for the provision of any inpatient hospital or institutional services for its enrollees. (3) Does not have a comprehensive risk contract. Presumptive income standard Primary care case management (1) A PCCM contracts with the State to furnish case management services (which include the location, coordination and monitoring of primary health care services) to CHIP beneficiaries; or (2) A PCCM entity contracts with the State to provide a defined set of functions to CHIP beneficiaries. Primary care case management entity (PCCM entity) (1) Provision of intensive telephonic or face-to-face case management, including operation of a nurse triage advice line. (2) Development of enrollee care plans. (3) Execution of contracts with and/or oversight responsibilities for the activities of fee-for-service providers in the fee-for-service program. (4) Provision of payments to fee-for-service providers on behalf of the State. (5) Provision of enrollee outreach and education activities. (6) Operation of a customer service call center. (7) Review of provider claims, utilization and practice patterns to conduct provider profiling and/or practice improvement. (8) Implementation of quality improvement activities including administering enrollee satisfaction surveys or collecting data necessary for performance measurement of providers. (9) Coordination with behavioral health systems/providers. (10) Coordination with long-term services and supports systems/providers. Primary care case manager (PCCM) (1) A physician assistant. (2) A nurse practitioner. (3) A certified nurse-midwife. Provider Public agency Qualified entity Risk contract (1) Assumes risk for the cost of the services covered under the contract. (2) Incurs loss if the cost of furnishing the services exceeds the payments under the contract. Secure electronic interface Separate child health program Shared eligibility service State State health benefits plan State plan Targeted low-income child Uncovered or uninsured child Well-baby and well-child care services [66 FR 2670, Jan. 11, 2001, as amended at 67 FR 61974, Oct. 2, 2002; 75 FR 48852, Aug. 11, 2010; 77 FR 17213, Mar. 23, 2012; 78 FR 42312, July 15, 2013; 81 FR 27896, May 6, 2016; 81 FR 47046, July 20, 2016; 81 FR 86463, Nov. 30, 2016; 89 FR 41284, May 10, 2024] § 457.30 Basis, scope, and applicability of subpart A. (a) Statutory basis. (1) Section 2101(b), which requires that the State submit a State plan. (2) Section 2102(a), which sets forth requirements regarding the contents of the State plan. (3) Section 2102(b), which relates to eligibility standards and methodologies. (4) Section 2102(c), which requires that the State plan include a description of the procedures to be used by the State to accomplish outreach and coordination with other health insurance programs. (5) Section 2106, which specifies the process for submission, approval, and amendment of State plans. (6) Section 2107(c), which requires that the State plan include a description of the process used to involve the public in the design and implementation of the plan. (7) Section 2107(d), which requires that the State plan include a description of the budget for the plan. (8) Section 2107(e), which provides that certain provisions of title XIX and title XI of the Act apply under title XXI in the same manner that they apply under title XIX. (b) Scope. (c) Applicability. § 457.40 State program administration. (a) Program operation. (b) State authority to submit State plan. (c) State program officials. (d) State legislative authority. § 457.50 State plan. The State plan is a comprehensive written statement, submitted by the State to CMS for approval, that describes the purpose, nature, and scope of the State's CHIP and gives an assurance that the program is administered in conformity with the specific requirements of title XXI, title XIX (as appropriate), and the regulations in this chapter. The State plan contains all information necessary for CMS to determine whether the plan can be approved to serve as a basis for Federal financial participation (FFP) in the State program. The Secretary will periodically specify updated requirements on the format of State plan through a process consistent with the requirements of the Paperwork Reduction Act. [81 FR 86463, Nov. 30, 2016] § 457.60 Amendments. A State may seek to amend its approved State plan in whole or in part at any time through the submission of an amendment to CMS. The Secretary will periodically specify updated requirements on the format of State plan amendments through a process consistent with the requirements of the Paperwork Reduction Act. When the State plan amendment has a significant impact on the approved budget, the amendment must include an amended budget that describes the State's planned expenditures for a 1-year period. A State must amend its State plan whenever necessary to reflect— (a) Changes in Federal law, regulations, policy interpretations, or court decisions that affect provisions in the approved State plan; (b) Changes in State law, organization, policy, or operation of the program that affect the following program elements described in the State plan: (1) Eligibility standards, enrollment caps, and disenrollment policies as described in § 457.305. (2) Procedures to prevent substitution of private coverage as described in § 457.805, and in § 457.810 for premium assistance programs. (3) The type of health benefits coverage offered, consistent with the options described in § 457.410. (4) Addition or deletion of specific categories of benefits covered under the State plan. (5) Basic delivery system approach as described in § 457.490. (6) Cost-sharing as described in § 457.505. (7) Screen and enroll procedures, and other Medicaid coordination procedures as described in § 457.350. (8) Review procedures as described in § 457.1120. (9) Other comparable required program elements. (c) Changes in the source of the State share of funding, except for changes in the type of non-health care related revenues used to generate general revenue. [66 FR 2670, Jan. 11, 2001, as amended at 66 FR 33822, June 25, 2001; 81 FR 86463, Nov. 30, 2016] § 457.65 Effective date and duration of State plans and plan amendments. (a) Effective date in general. (1) A State plan or plan amendment takes effect on the day specified in the plan or plan amendment, but no earlier than October 1, 1997. (2) The effective date may be no earlier than the date on which the State begins to incur costs to implement its State plan or plan amendment. (3) A State plan amendment that takes effect prior to submission of the amendment to CMS may remain in effect only until the end of the State fiscal year in which the State makes it effective, or, if later, the end of the 90-day period following the date on which the State makes it effective, unless the State submits the amendment to CMS for approval before the end of that State fiscal year or that 90-day period. (b) Amendments relating to eligibility or benefits. (1) The State certifies that it has provided prior public notice of the proposed change in a form and manner provided under applicable State law; and (2) The public notice was published before the requested effective date of the change. (c) Amendments relating to cost sharing. (d) Amendments relating to enrollment procedures. (e) Amendments relating to the source of State funding. (f) Continued approval. (1) The State adopts a new plan by obtaining approval under § 457.60 of an amendment to the State plan; (2) Withdraws its plan in accordance with § 457.170(b); or (3) The Secretary finds substantial noncompliance of the plan with the requirements of the statute or regulations. [66 FR 2670, Jan. 11, 2001, as amended at 89 FR 22873, Apr. 2, 2024] § 457.70 Program options. (a) Health benefits coverage options. (1) A separate child health program; (2) A Medicaid expansion program; or (3) A combination program. (b) State plan requirement. (c) Medicaid expansion program requirements. (1) Meet the requirements of— (i) Subpart A; (ii) Subpart B (to the extent that the State claims administrative costs under title XXI); (iii) Subpart F (with respect to determination of the allotment for purposes of the enhanced matching rate, determination of the enhanced matching rate, and payment of any claims for administrative costs under title XXI only); (iv) Subpart G; and (v) Subpart J (if the State claims administrative costs under title XXI and seeks a waiver of limitations on such claims based on a community based health delivery system). (2) Be consistent with the State's Medicaid State plan, or an approvable amendment to that plan, as required under title XIX. (d) Separate child health program requirements. (e) Combination program requirements. § 457.80 Current State child health insurance coverage and coordination. A State plan must include a description of— (a) The extent to which, and manner in which, children in the State, including targeted low-income children and other classes of children, by income level and other relevant factors, currently have creditable health coverage (as defined in § 457.10) and, if sufficient information is available, whether the creditable health coverage they have is under public health insurance programs or health insurance programs that involve public-private partnerships; (b) Current State efforts to provide or obtain creditable health coverage for uncovered children, including the steps the State is taking to identify and enroll all uncovered children who are eligible to participate in public health insurance programs and health insurance programs that involve public-private partnerships; and (c) Procedures the State uses to accomplish coordination of CHIP with other public and private health insurance programs, sources of health benefits coverage for children, and relevant child health programs, such as title V, that provide health care services for low-income children. Such procedures include those designed to— (1) Increase the number of children with creditable health coverage; (2) Assist in the enrollment in CHIP of children determined ineligible for Medicaid; and (3) Ensure coordination with other insurance affordability programs in the determination of eligibility and enrollment in coverage to ensure that all eligible individuals are enrolled in the appropriate program, including through use of the procedures described in §§ 457.305, 457.348 and 457.350 of this part. [65 FR 33622, May 24, 2000, as amended at 77 FR 17214, Mar. 23, 2012] § 457.90 Outreach. (a) Procedures required. (b) Examples. (1) Education and awareness campaigns, including targeted mailings and information distribution through various organizations. (2) Enrollment simplification, such as simplified or joint application forms. (3) Application assistance, including opportunities to apply for child health assistance under the plan through community-based organizations and in combination with other benefits and services available to children. § 457.110 Enrollment assistance and information requirements. (a) Information disclosure. (1) The State must provide individuals with a choice to receive notices and information required under this subpart and subpart K of this part, in electronic format or by regular mail, provided that the State establish safeguards in accordance with § 435.918 of this chapter. (2) [Reserved] (b) Required information. (1) Types of benefits, and amount, duration and scope of benefits available under the program. (2) Cost-sharing requirements as described in § 457.525. (3) Names and locations of current participating providers. (4) If an enrollment cap is in effect or the State is using a waiting list, a description of the procedures relating to the cap or waiting list, including the process for deciding which children will be given priority for enrollment, how children will be informed of their status on a waiting list and the circumstances under which enrollment will reopen. (5) Information on physician incentive plans as required by § 457.985. (6) Review processes available to applicants and enrollees as described in the State plan pursuant to § 457.1120. [65 FR 33622, May 24, 2000, as amended at 78 FR 42312, July 15, 2013; 81 FR 86463, Nov. 30, 2016] § 457.120 Public involvement in program development. A State plan must include a description of the method the State uses to— (a) Involve the public in both the design and initial implementation of the program; (b) Ensure ongoing public involvement once the State plan has been implemented; and (c) Ensure interaction with Indian Tribes and organizations in the State on the development and implementation of the procedures required at § 457.125. § 457.125 Provision of child health assistance to American Indian and Alaska Native children. (a) Enrollment. (b) Exemption from cost sharing. § 457.130 Civil rights assurance. The State plan must include an assurance that the State will comply with all applicable civil rights requirements, including title VI of the Civil Rights Act of 1964, title II of the Americans with Disabilities Act of 1990, section 504 of the Rehabilitation Act of 1973, the Age Discrimination Act of 1975, 45 CFR part 80, part 84, and part 91, and 28 CFR part 35. § 457.135 Assurance of compliance with other provisions. The State plan must include an assurance that the State will comply, under title XXI, with the following provisions of titles XIX and XI of the Social Security Act: (a) Section 1902(a)(4)(C) (relating to conflict of interest standards). (b) Paragraphs (2), (16) and (17) of section 1903(i) (relating to limitations on payment). (c) Section 1903(w) (relating to limitations on provider donations and taxes). (d) Section 1132 (relating to periods within which claims must be filed). § 457.140 Budget. The State plan, or plan amendment that has a significant impact on the approved budget, must include a budget that describes the State's planned expenditures for a 1-year period. The budget must describe— (a) Planned use of funds, including— (1) Projected amount to be spent on health services; (2) Projected amount to be spent on administrative costs, such as outreach, child health initiatives, and evaluation; and (3) Assumptions on which the budget is based, including cost per child and expected enrollment; and (b) Projected sources of non-Federal plan expenditures, including any requirements for cost sharing by enrollees. § 457.150 CMS review of State plan material. (a) Basis for action. (b) Action on complete plan. (c) Authority. (d) Initial submission. (e) Review process. (2) CMS notifies the State of the identity of the designated individual in the first correspondence relating to that plan, and at any time there is a change in the designated individual. (3) In the temporary absence of the designated individual during regular business hours, an alternate individual will act in place of the designated individual. § 457.160 Notice and timing of CMS action on State plan material. (a) Notice of final determination. (b) Timing. (i) Written notice of disapproval; or (ii) Written notice of additional information it needs in order to make a final determination. (2) A State plan or plan amendment is considered received when the designated official or individual, as determined in § 457.150(d) and (e), receives an electronic, fax or paper copy of the complete material. (3) If CMS requests additional information, the 90-day review period for CMS action on the State plan or plan amendment— (i) Stops on the day CMS sends a written request for additional information or the next business day if the request is sent on a Federal holiday or weekend; and (ii) Resumes on the next calendar day after the CMS designated individual receives an electronic, fax, or hard copy from the State of all the requested additional information, unless the information is received after 5 p.m. eastern standard time on a day prior to a non-business day or any time on a non-business day, in which case the review period resumes on the following business day. (4) The 90-day review period cannot stop or end on a non-business day. If the 90th calendar day falls on a non-business day, CMS will consider the 90th day to be the next business day. (5) CMS may send written notice of its need for additional information as many times as necessary to obtain the complete information necessary to review the State plan or plan amendment. § 457.170 Withdrawal process. (a) Withdrawal of proposed State plans or plan amendments. (b) Withdrawal of approved State plans. Subpart B—General Administration—Reviews and Audits; Withholding for Failure to Comply; Deferral and Disallowance of Claims; Reduction of Federal Medical Payments § 457.200 Program reviews. (a) Review of State and local administration of the CHIP plan. (b) Action on review findings. § 457.202 Audits. (a) Purpose. (1) The program is being operated in a cost-efficient manner; and (2) Funds are being properly expended for the purposes for which they were appropriated under Federal and State law and regulations. (b) Reports. (2) The reports set forth OIG opinion and recommendations regarding the practices it reviewed, and the allowability of the costs it audited. (3) Cognizant officials of the Department make final determinations on all audit findings. (c) Action on audit exceptions Concurrence or clearance. (2) Appeal. (3) Adjustment. § 457.203 Administrative and judicial review of action on State plan material. (a) Request for reconsideration. (b) Notice of hearing. (c) Hearing procedures. (d) Effect of hearing decision. [66 FR 2674, Jan. 11, 2001] § 457.204 Withholding of payment for failure to comply with Federal requirements. (a) Basis for withholding. (1) That the State plan is in substantial noncompliance with the requirements of Title XXI of the Act or the regulations in this part; or (2) That the State is conducting its program in substantial noncompliance with either the State plan or the requirements of Title XXI of the Act or the regulations in this part. (Hearings are generally not called until a reasonable effort has been made to resolve the issues through conferences and discussions. These efforts may be continued even if a date and place have been set for the hearing.) (3) For purposes of this paragraph (a), substantial non-compliance includes, but is not limited to, failure to comply with requirements that significantly affect federal or state oversight or state reporting. (b) Noncompliance of the plan. (c) Noncompliance in practice. (d) Notice, reasonable opportunity for correction, and implementation of withholding. (1) Preliminary notice. (i) Of the findings of noncompliance; (ii) The proposed enforcement actions to withhold payments; and (iii) If enforcement action is proposed, that the State has a reasonable opportunity for correction, described in paragraph (d)(2) of this section, before the Administrator takes final action. (2) Opportunity for corrective action. (3) Final notice. (i) Of the final determination on the findings of noncompliance; (ii) If enforcement action is appropriate— (A) No further payments will be made to the State (or that payments will be made only for those portions or aspects of the programs that are not affected by the noncompliance); and (B) The total or partial withholding will continue until the Administrator is satisfied that the State's plan and practice are, and will continue to be, in compliance with Federal requirements. (4) Hearing. (5) Withholding. CMS withholds payments, in whole or in part, until the Administrator is satisfied regarding the State's compliance. [65 FR 33622, May 24, 2000, as amended at 66 FR 2674, Jan. 11, 2001; 81 FR 27897, May 6, 2016] § 457.206 Administrative appeals under CHIP. Three distinct types of determinations are subject to Departmental reconsideration upon request by a State. (a) Compliance with Federal requirements. (b) FFP in State CHIP expenditures. (c) Discretionary grants disputes. § 457.208 Judicial review. (a) Right to judicial review. (b) Petition for review. (2) After the clerk of the court files a copy of the petition with the Administrator, the Administrator files in the court the record of the proceedings on which the determination was based. (c) Court action. (2) The court has jurisdiction to affirm the Administrator's decision, to set it aside in whole or in part, or, for good cause, to remand the case for additional evidence. (d) Response to remand. (2) The Administrator certifies to the court the transcript and record of the further proceedings. (e) Review by the Supreme Court. [65 FR 33622, May 24, 2000, as amended at 66 FR 2674, Jan. 11, 2001] § 457.216 Treatment of uncashed or canceled (voided) CHIP checks. (a) Purpose. (b) Definitions. Canceled (voided) check Fiscal agent Uncashed check Warrant (c) Refund of Federal financial participation (FFP) for uncashed checks General provisions. (2) Report of refund. (3) If the State does not refund the appropriate amount as specified in paragraph (c)(2) of this section, the amount will be disallowed. (d) Refund of FFP for canceled (voided) checks General provisions. (2) Report of refund. (3) If the State does not refund the appropriate amount as specified in paragraph (d)(2) of this section, the amount will be disallowed. § 457.220 Funds from units of government as the State share of financial participation. (a) Public funds may be considered as the State's share in claiming FFP if they meet the conditions specified in paragraphs (b) and (c) of this section. (b) The public funds are appropriated directly to the State or local CHIP agency, or are transferred from other public agencies (including Indian tribes) to the State or local agency and are under its administrative control, or are certified by the contributing public agency as representing expenditures eligible for FFP under this section. (c) The public funds are not Federal funds, or are Federal funds authorized by Federal law to be used to match other Federal funds. [75 FR 73976, Nov. 30, 2010] § 457.222 FFP for equipment. Claims for Federal financial participation in the cost of equipment under CHIP are determined in accordance with subpart G of 45 CFR part 95. Requirements concerning the management and disposition of equipment under CHIP are also prescribed in subpart G of 45 CFR part 95. § 457.224 FFP: Conditions relating to cost sharing. (a) No FFP is available for the following amounts, even when related to services or benefit coverage which is or could be provided under a State CHIP program— (1) Any cost sharing amounts that beneficiaries should have paid as enrollment fees, premiums, deductibles, coinsurance, copayments, or similar charges. (2) Any amounts paid by the agency for health benefits coverage or services furnished to individuals who would not be eligible for that coverage or those services under the approved State child health plan, whether or not the individual paid any required premium or enrollment fee. (b) The amount of expenditures under the State child health plan must be reduced by the amount of any premiums and other cost-sharing received by the State. § 457.226 Fiscal policies and accountability. A State plan must provide that the CHIP agency and, where applicable, local agencies administering the plan will— (a) Maintain an accounting system and supporting fiscal records to assure that claims for Federal funds are in accord with applicable Federal requirements; (b) Retain records for 3 years from date of submission of a final expenditure report; (c) Retain records beyond the 3-year period if audit findings have not been resolved; and (d) Retain records for nonexpendable property acquired under a Federal grant for 3 years from the date of final disposition of that property. § 457.228 Cost allocation. A State plan must provide that the single or appropriate CHIP Agency will have an approved cost allocation plan on file with the Department in accordance with the requirements contained in subpart E of 45 CFR part 95. Subpart E also sets forth the effect on FFP if the requirements contained in that subpart are not met. § 457.230 FFP for State ADP expenditures. FFP is available for State ADP expenditures for the design, development, or installation of mechanized claims processing and information retrieval systems and for the operation of certain systems. Additional HHS regulations and CMS procedures regarding the availability of FFP for ADP expenditures are in 2 CFR parts 200 and 300, 45 CFR part 95, subpart F, and part 11, State Medicaid Manual. [65 FR 33622, May 24, 2000, as amended at 81 FR 3012, Jan. 20, 2016; 89 FR 80070, Oct. 2, 2024] § 457.232 Refunding of Federal Share of CHIP overpayments to providers and referral of allegations of waste, fraud or abuse to the Office of Inspector General. (a) Quarterly Federal payments to the States under title XXI (CHIP) of the Act are to be reduced or increased to make adjustment for prior overpayments or underpayments that the Secretary determines have been made. (b) The Secretary will consider the pro rata Federal share of the net amount recovered by a State during any quarter to be an overpayment. (c) Allegations or indications of waste fraud and abuse with respect to the CHIP program shall be referred promptly to the Office of Inspector General. § 457.236 Audits. The CHIP agency must assure appropriate audit of records on costs of provider services. § 457.238 Documentation of payment rates. The CHIP agency must maintain documentation of payment rates and make it available to HHS upon request. Subpart C—State Plan Requirements: Eligibility, Screening, Applications, and Enrollment Source: 66 FR 2675, Jan. 11, 2001, unless otherwise noted. § 457.300 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2102 of the Act, which relates to eligibility standards and methodologies, coordination with other health insurance programs, and outreach and enrollment efforts to identify and enroll children who are eligible to participate in other public health insurance programs; (2) Section 2105(c)(6)(B) of the Act, which relates to the prohibition against expenditures for child health assistance provided to children eligible for coverage under other Federal health care programs other than programs operated or financed by the Indian Health Service; and (3) Section 2110(b) of the Act, which provides a definition of targeted low-income child. (4) Section 2107(e)(1)(O) of the Affordable Care Act, which relates to coordination of CHIP with the Exchanges and the State Medicaid agency. (5) Section 2107(e)(1)(F) of the Affordable Care Act, which relates to income determined based on modified adjusted gross income. (b) Scope. (c) Applicability. [65 FR 33622, May 24, 2000, as amended at 77 FR 17214, Mar. 23, 2012] § 457.301 Definitions and use of terms. As used in this subpart— Eligibility determination Family size Medicaid applicable income level Non-applicant Period of presumptive eligibility (1) In the case of a child on whose behalf a separate child health program application has been filed, the day on which a decision is made on that application; or (2) In the case of a child on whose behalf an application for the separate child health program has not been filed, the last day of the month following the month in which the determination of presumptive eligibility was made. Presumptive income standard Public agency Qualified entity (1) Furnishes health care items and services covered under the approved plan and is eligible to receive payments under the approved plan; (2) Is authorized to determine eligibility of a child to participate in a Head Start program under the Head Start Act; (3) Is authorized to determine eligibility of a child to receive child care services for which financial assistance is provided under the Child Care and Development Block Grant Act of 1990; (4) Is authorized to determine eligibility of an infant or child to receive assistance under the special nutrition program for women, infants, and children (WIC) under section 17 of the Child Nutrition Act of 1966; (5) Is authorized to determine eligibility of a child for medical assistance under the Medicaid State plan, or eligibility of a child for child health assistance under the Children's Health Insurance Program; (6) Is an elementary or secondary school, as defined in section 14101 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801); (7) Is an elementary or secondary school operated or supported by the Bureau of Indian Affairs; (8) Is a State or Tribal child support enforcement agency; (9) Is an organization that— (i) Provides emergency food and shelter under a grant under the Stewart B. McKinney Homeless Assistance Act; (ii) Is a State or Tribal office or entity involved in enrollment in the program under this title, Part A of title IV, or title XXI; or (iii) Determines eligibility for any assistance or benefits provided under any program of public or assisted housing that receives Federal funds, including the program under section 8 or any other section of the United States Housing Act of 1937 (42 U.S.C. 1437) or under the Native American Housing Assistance and Self Determination Act of 1996 (25 U.S.C. 4101 et seq. (10) Any other entity the State so deems, as approved by the Secretary. State health benefits plan [66 FR 2675, Jan. 11, 2001, as amended at 66 FR 33823, June 25, 2001; 75 FR 48852, Aug. 11, 2010; 77 FR 17214, Mar. 23, 2012] § 457.305 State plan provisions. The State plan must include a description of— (a) The standards, consistent with § 457.310 and § 457.320 of this subpart, and financial methodologies consistent with § 457.315 of this subpart used to determine the eligibility of children for coverage under the State plan. (b) The State's policies governing enrollment and disenrollment; processes for screening applicants for and, if eligible, facilitating their enrollment in other insurance affordability programs; and processes for implementing waiting lists and enrollment caps (if any). [77 FR 17214, Mar. 23, 2012] § 457.310 Targeted low-income child. (a) Definition. (b) Standards. (1) Financial need standard. (i) Has a household income, as determined in accordance with § 457.315 of this subpart, at or below 200 percent of the Federal poverty level for a family of the size involved; (ii) Resides in a State with no Medicaid applicable income level; (iii) Resides in a State that has a Medicaid applicable income level and has a household income that either— (A) Exceeds the Medicaid applicable income level for the age of such child, but not by more than 50 percentage points; or (B) Does not exceed the income level specified for such child to be eligible for medical assistance under policies of the State plan under title XIX on June 1, 1997. (2) No other coverage standard. (i) Found eligible or potentially eligible for Medicaid under policies of the State plan (determined through either the Medicaid application process or the screening process described at § 457.350), except for eligibility under § 435.214 of this chapter (related to coverage for family planning services); (ii) Covered under a group health plan or under health insurance coverage, as defined in section 2791 of the Public Health Service Act, unless the plan or health insurance coverage program has been in operation since before July 1, 1997 and is administered by a State that receives no Federal funds for the program's operation. A child is not considered covered under a group health plan or health insurance coverage if the child does not have reasonable geographic access to care under that plan. (3) For purposes of this section, policies of the State plan under title XIX plan include policies under a Statewide demonstration project under section 1115(a) of the Act other than a demonstration project that covered an expanded group of eligible children but that either— (i) Did not provide inpatient hospital coverage; or (ii) Limited eligibility to children previously enrolled in Medicaid, imposed premiums as a condition of initial or continued enrollment, and did not impose a general time limit on eligibility. (c) Exclusions. (1) Children eligible for certain State health benefits coverage. (ii) A child is considered eligible for health benefits coverage under a State health benefits plan if a more than nominal contribution to the cost of health benefits coverage under a State health benefits plan is available from the State or public agency with respect to the child or would have been available from those sources on November 8, 1999. A contribution is considered more than nominal if the State or public agency makes a contribution toward the cost of an employee's dependent(s) that is $10 per family, per month, more than the State or public agency's contribution toward the cost of covering the employee only. (2) Residents of an institution. (i) An inmate of a public institution as defined at § 435.1010 of this chapter; or (ii) A patient in an institution for mental diseases, as defined at § 435.1010 of this chapter, at the time of initial application or any redetermination of eligibility. (d) A targeted low-income child must also include any child enrolled in Medicaid on December 31, 2013 who is determined to be ineligible for Medicaid as a result of the elimination of income disregards as specified under § 435.603(g) of this chapter, regardless of any other standards set forth in this section except those in paragraph (c) of this section. Such a child shall continue to be a targeted low-income child under this paragraph until the date of the child's next renewal under § 457.343 of this subpart. [66 FR 2675, Jan. 11, 2001, as amended at 71 FR 39229, July 12, 2006; 77 FR 17214, Mar. 23, 2012; 81 FR 86463, Nov. 30, 2016] § 457.315 Application of modified adjusted gross income and household definition. (a) Effective January 1, 2014, the State must apply the financial methodologies set forth in paragraphs (b) through (i) of § 435.603 of this chapter in determining the financial eligibility of all individuals for CHIP. The exception to application of such methods for individuals for whom the State relies on a finding of income made by an Express Lane agency at § 435.603(j)(1) of this subpart also applies. (b) In the case of determining ongoing eligibility for enrollees determined eligible for CHIP on or before December 31, 2013, application of the financial methodologies set forth in this section will not be applied until March 31, 2014 or the next regularly-scheduled renewal of eligibility for such individual under § 457.343, whichever is later. [77 FR 17214, Mar. 23, 2012] § 457.320 Other eligibility standards. (a) Eligibility standards. (1) Geographic area(s) served by the plan; (2) Age (up to, but not including, age 19); (3) Income; (4) Spenddowns; (5) Residency, in accordance with paragraph (d) of this section; (6) Disability status, provided that such standards do not restrict eligibility; (7) Access to, or coverage under, other health coverage; and (8) Duration of eligibility, in accordance with paragraph (e) of this section. (b) Prohibited eligibility standards. not (1) Cover children with a higher household income without covering children with a lower household income within any defined group of covered targeted low-income children; (2) Deny eligibility based on a preexisting medical condition; (3) Discriminate on the basis of diagnosis; (4) Require any family member who is not requesting services to provide a social security number (including those family members whose income or resources might be used in making the child's eligibility determination); (5) Exclude American Indian or Alaska Native children based on eligibility for, or access to, medical care funded by the Indian Health Service; (6) Exclude individuals based on citizenship or nationality, to the extent that the children are U.S. citizens, U.S. nationals or qualified noncitizens (as defined at paragraph (c) of this section); or (7) Violate any other Federal laws or regulations pertaining to eligibility for a separate child health program under title XXI. (c) Definitions. Qualified noncitizen (d) Citizenship and immigration status. (e) Residency. (2) Residency for a targeted low-income pregnant woman defined at 2112 of the Act must be determined in accordance with § 435.403(h) of this chapter. (3) A State may not— (i) Impose a durational residency requirement; (ii) Preclude the following individuals from declaring residence in a State— (A) An institutionalized child who is not a ward of a State, if the State is the State of residence of the child's custodial parent or caretaker at the time of placement; or (B) A child who is a ward of a State, regardless of where the child lives (4) In cases of disputed residency, the State must follow the process described in § 435.403(m) of this chapter. (f) Duration of eligibility. (2) [Reserved] [66 FR 2675, Jan. 11, 2001, as amended at 66 FR 33823, June 25, 2001, 77 FR 17214, Mar. 23, 2012; 81 FR 86463, Nov. 30, 2016; 89 FR 39436, May 8, 2024] § 457.330 Application. The State shall use the single, streamlined application used by the State in accordance with paragraph (b) of § 435.907 of this chapter, and otherwise comply with such section, except that the terms of § 435.907(c) of this chapter (relating to applicants seeking coverage on a basis other than modified adjusted gross income) do not apply. [77 FR 17215, Mar. 23, 2012] § 457.340 Application for and enrollment in CHIP. (a) Application and renewal assistance, availability of program information, and Web site. (b) Use of Social Security number. (c) Notice of rights and responsibilities. (d) Timely determination of eligibility. (2) In applying timeliness standards, the State must define “date of application” and must count each calendar day from the date of application to the day the agency provides notice of its eligibility decision. (3) In the case of individuals subject to a period of uninsurance under this part, the state must identify and implement processes to facilitate enrollment of CHIP-eligible children who have satisfied a period of uninsurance (as described under § 457.805). To minimize burden on individuals, a state may not require a new application or information already provided by a family immediately preceding the beginning of a waiting period. States must also ensure that the proper safeguards are in place to prevent a disruption in coverage for children transitioning from coverage under another insurance affordability program after the completion of a period of uninsurance. (e) Notice of eligibility determinations. (1) Content of eligibility notice. (A) The basis and effective date of eligibility; (B) The circumstances under which the individual must report and procedures for reporting, any changes that may affect the individual's eligibility; (C) Basic information on benefits and services and if applicable, any premiums, enrollment fees, and cost sharing required, and an explanation of how to receive additional detailed information on benefits and financial responsibilities; and (D) Information on the enrollees' right and responsibilities, including the opportunity to request a review of matters described in § 457.1130. (ii) Any notice of denial, termination, or suspension of CHIP eligibility must include, but is not limited to the following— (A) The basis supporting the action and the effective date, (B) Information on the individual's right to a review process, in accordance with § 457.1180; (iii) In the case of a suspension or termination of eligibility, the State must provide sufficient notice to enable the child's parent or other caretaker to take any appropriate actions that may be required to allow coverage to continue without interruption. (2) The State's responsibility to provide notice under this paragraph is satisfied by a combined eligibility notice, as defined in § 457.10, provided by an Exchange or other insurance affordability program in accordance with paragraph (f) of this section, except that, if the information described in paragraph (e)(1)(i)(C) of this section is not included in such combined eligibility notice, the State must provide the individual with a supplemental notice of such information, consistent with this section. (f) Coordination of notices with other programs. (1) Include in the agreement into which the State has entered under § 457.348(a) that, a combined eligibility notice, as defined in § 457.10, will be provided: (i) To an individual, by the State agency administering a separate CHIP or the Medicaid agency, when a determination of CHIP eligibility is completed for such individual by the State agency administering Medicaid in accordance with § 457.348(e), or a determination of Medicaid eligibility is completed by the State in accordance with § 457.350(b)(1); (ii) To the maximum extent feasible, to an individual who is not described in paragraph (f)(1)(i) of this section but who is transferred between the State and another insurance affordability program in accordance with § 457.348 or § 457.350; and (iii) To the maximum extent feasible, to multiple members of the same household included on the same application or renewal form. (2) For individuals and other household members who will not receive a combined eligibility notice, include appropriate coordinated content, as defined in § 457.10, in any notice provided by the State in accordance with paragraph (e)(1) of this section. (g) Effective date of eligibility. [66 FR 2675, Jan. 11, 2001, as amended at 66 FR 33823, June 25, 2001; 77 FR 17215, Mar. 23, 2012; 78 FR 42312, July 15, 2013; 81 FR 86464, Nov. 30, 2016; 89 FR 22873, Apr. 2, 2024; 91 FR 33482, June 3, 2026] § 457.342 Continuous eligibility for children. (a) A State must provide continuous eligibility for children under a separate CHIP in accordance with the terms of § 435.926 of this chapter, and subject to a child remaining ineligible for Medicaid, as required by section 2110(b)(1) of the Act and § 457.310 (related to the definition and standards for being a targeted low-income child) and the requirements of section 2102(b)(3) of the Act and § 457.350 (related to eligibility screening and enrollment). (b) [Reserved] [90 FR 2636, Jan. 13, 2025] § 457.343 Periodic renewal of CHIP eligibility. The renewal procedures described in § 435.916 of this chapter apply equally to the State in administering a separate CHIP, except that the State shall verify information needed to renew CHIP eligibility in accordance with § 457.380 of this subpart, shall provide notice regarding the State's determination of renewed eligibility or termination in accordance with § 457.340(e) of this subpart and shall comply with the requirements set forth in § 457.350 of this subpart for screening individuals for other insurance affordability programs and transmitting such individuals' electronic account and other relevant information to the appropriate program. [77 FR 17215, Mar. 23, 2012] § 457.348 Determinations of Children's Health Insurance Program eligibility by other insurance affordability programs. (a) Agreements with other insurance affordability programs. (1) Minimize burden on individuals seeking to obtain or renew eligibility or to appeal a determination of eligibility for one or more insurance affordability program; (2) Ensure compliance with paragraphs (b) and (c) of this section and § 457.350; (3) Ensure prompt determination of eligibility and enrollment in the appropriate program without undue delay, consistent with the timeliness standards established under § 457.340(d), based on the date the application is submitted to any insurance affordability program, and (4) Provide for a combined eligibility notice and coordination of notices with other insurance, consistent with § 457.340(f), and an opportunity for individuals to submit a joint review request, as defined in § 457.10, consistent with § 457.351. (5) Provide for a combined appeals decision by an Exchange or Exchange appeals entity (or other insurance affordability program or appeals entity) for individuals who requested an appeal of an Exchange-related determination in accordance with 45 CFR part 155 subpart F (or of a determination related to another program) and an appeal of a denial of CHIP eligibility which is conducted by an Exchange or Exchange appeals entity (or other program or appeals entity) in accordance with the State plan. (6) Seamlessly transition the enrollment of beneficiaries between CHIP and Medicaid when a beneficiary is determined eligible for one program by the agency administering the other. (b) Provision of CHIP for individuals found eligible for CHIP by another insurance affordability program. (i) Establish procedures to receive, via secure electronic interface, the electronic account containing the determination of CHIP eligibility and notify such program of the receipt of the electronic account; (ii) Comply with the provisions of § 457.340 to the same extent as if the application had been submitted to the State; and (iii) Maintain proper oversight of the eligibility determinations made by the other program. (2) For purposes of paragraph (b)(1) of this section, individuals determined eligible for CHIP in this paragraph (b) include: (i) Individuals determined eligible for CHIP by another insurance affordability program, including the Exchange, pursuant to an agreement between the State and the other insurance affordability program (including as a result of a decision made by the program or the program's appeal entity in accordance with paragraph (a) of this section); and (ii) Individuals determined eligible for CHIP by the State Medicaid agency (including as the result of a decision made by the Medicaid appeals entity) in accordance with paragraph (e) of this section. (c) Transfer from other insurance affordability programs to CHIP. (1) Accept, via secure electronic interface, the electronic account for the individual and notify such program of the receipt of the electronic account; (2) Not request information or documentation from the individual in the individual's electronic account, or provided to the State by another insurance affordability program or appeals entity; (3) Promptly and without undue delay, consistent with the timeliness standards established under § 457.340(g), determine the CHIP eligibility of the individual, in accordance with § 457.340, without requiring submission of another application and, for individuals determined not eligible for CHIP, comply with § 457.350(i) of this section; (4) Accept any finding relating to a criterion of eligibility made by such program or appeals entity, without further verification, if such finding was made in accordance with policies and procedures which are the same as those applied by the State in accordance with § 457.380 or approved by it in the agreement described in paragraph (a) of this section; and (5) Notify such program of the final determination of the individual's eligibility or ineligibility for CHIP. (d) Certification of eligibility criteria. (e) CHIP determinations made by other insurance affordability programs. (1) Apply the same modified adjusted gross income (MAGI)-based methodologies in accordance with § 457.315, and verification policies and procedures in accordance with § 457.380 as those used by the Medicaid agency in accordance with §§ 435.940 through 435.956 of this chapter, such that the agency will accept any finding relating to a criterion of eligibility made by a Medicaid agency without further verification; (2) Enter into an agreement under which the State delegates authority to the Medicaid agency to make final determinations of CHIP eligibility; or (3) Adopt other procedures approved by the Secretary. [77 FR 17215, Mar. 23, 2012, as amended at 78 FR 42312, July 15, 2013; 81 FR 86464, Nov. 30, 2016; 89 FR 22875, Apr. 2, 2024] § 457.350 Eligibility screening and enrollment in other insurance affordability programs. (a) State plan requirement. (1) Only targeted low-income children are furnished CHIP coverage under the plan; and (2) Enrollment is facilitated for applicants and enrollees found to be eligible or potentially eligible for other insurance affordability programs in accordance with this section. (b) Evaluation of eligibility for other insurance affordability programs. (i) Determine eligibility for Medicaid on the basis of having household income at or below the applicable modified adjusted gross income standard, as defined in § 435.911(b) of this chapter (“MAGI-based Medicaid”); and (ii) If unable to make a determination of eligibility for MAGI-based Medicaid, identify potential eligibility for other insurance affordability programs, including Medicaid on a basis other than MAGI, the Basic Health Program (BHP) in accordance with § 600.305(a) of this chapter, or insurance affordability programs available through the Exchange, as indicated by information provided on the application or renewal form provided by or on behalf of the beneficiary, including information obtained by the agency from other trusted electronic data sources. (2) Individuals to whom paragraph (b)(1) of this section applies include: (i) Any applicant who submits an application to the State which includes sufficient information to determine CHIP eligibility; (ii) Any enrollee whose eligibility is being redetermined at renewal or due to a change in circumstance per § 457.343; and (iii) Any enrollee whom the State determines is not eligible for CHIP, or who is determined not eligible for CHIP as a result of a review conducted in accordance with subpart K of this part. (3) In determining eligibility for Medicaid as described in paragraph (b)(1) of this section, the State must utilize the option the Medicaid agency has elected at § 435.1200(b)(4) of this chapter to accept determinations of MAGI-based Medicaid eligibility made by a separate CHIP, and which must be detailed in the agreement described at § 457.348(a). (c) Income eligibility test. (d) Individuals found eligible for Medicaid based on MAGI. (1) Promptly and without undue delay, consistent with the timeliness standards established under § 457.340(d), transfer the individual's electronic account to the Medicaid agency via a secure electronic interface; and (2) Except as provided in § 457.355, find the applicant ineligible for CHIP. (e) Individuals potentially eligible for Medicaid on a basis other than MAGI. (1) Promptly and without undue delay, consistent with the timeliness standards established under § 457.340(d), transfer the electronic account to the Medicaid agency via a secure electronic interface. (2) Complete the determination of eligibility for CHIP in accordance with § 457.340 or evaluation for potential eligibility for other insurance affordability programs in accordance with paragraph (b) of this section. (3) Include in the notice of CHIP eligibility or ineligibility provided under § 457.340(e), as appropriate, coordinated content relating to— (i) The transfer of the individual's electronic account to the Medicaid agency per paragraph (e)(1) of this section; (ii) The transfer of the individual's account to another insurance affordability program in accordance with paragraph (g) of this section, if applicable; and (iii) The impact that an approval of Medicaid eligibility will have on the individual's eligibility for CHIP or another insurance affordability program, as appropriate. (4) Disenroll the enrollee from CHIP if the State is notified in accordance with § 435.1200(d)(5) of this chapter that the applicant has been determined eligible for Medicaid. (f) Children found ineligible for Medicaid based on MAGI, and potentially ineligible for Medicaid on a basis other than MAGI. (1) A statement that based on a limited review, the child does not appear eligible for Medicaid, but Medicaid eligibility can only be determined based on a full review of a Medicaid application under all Medicaid eligibility groups; (2) Information about Medicaid eligibility rules, covered benefits, and restrictions on cost sharing; and (3) Information about how and where to apply for Medicaid under all eligibility groups. (4) The State will determine the written format and timing of the information regarding Medicaid eligibility, benefits, and the application process required under this paragraph (f). (g) Individuals found potentially eligible for other insurance affordability programs. (h) Evaluation of eligibility for Exchange coverage. (i) Waiting lists, enrollment caps and closed enrollment. (1) The procedures developed in accordance with this section have been followed for each child applying for a separate child health program before placing the child on a waiting list or otherwise deferring action on the child's application for the separate child health program; (2) Children placed on a waiting list or for whom action on their application is otherwise deferred are transferred to other insurance affordability programs in accordance with paragraph (h) of this section; and (3) Families are informed that a child may be eligible for other insurance affordability programs, while the child is on a waiting list for a separate child health program or if circumstances change, for Medicaid. [89 FR 22875, Apr. 2, 2024] § 457.351 Coordination involving appeals entities for different insurance affordability programs. (a) The terms of § 435.1200(g) of this chapter apply equally to the State in administering a separate CHIP. References to a “fair hearing” and “joint fair hearing request” in § 435.1200(g) of this chapter are treated as references to a “review” under subpart K of this part and to a “joint appeal request” as defined in § 457.10. Reference to “expedited review of a fair hearing request consistent with § 431.221(a)(1)(ii) of this chapter” is considered a reference to “expedited review of an eligibility or enrollment matter under § 457.1160(a)”. Reference to § 435.1200(b)(3), (c), (d) and (e) are treated as a reference to § 457.348(b), (c) and (d) and § 457.350(c), respectively. (b) [Reserved] [81 FR 86466, Nov. 30, 2016] § 457.353 Monitoring and evaluation of screening process. States must establish a mechanism and monitor to evaluate the screen and enroll process described at § 457.350 of this subpart to ensure that children who are: (a) Screened as potentially eligible for other insurance affordability programs are enrolled in such programs, if eligible; or (b) Determined ineligible for other insurance affordability programs are enrolled in CHIP, if eligible. [77 FR 17216, Mar. 23, 2012] § 457.355 Presumptive eligibility for children. The State may provide coverage under a separate child health program for children determined by a qualified entity to be presumptively eligible for the State's separate CHIP in the same manner and to the same extent as permitted under Medicaid under § 435.1101 and § 435.1102 of this chapter. [81 FR 86466, Nov. 30, 2016] § 457.360 Deemed newborn children. (a) Basis. (b) Eligibility. (i) The child's mother was eligible for and received covered services for the date of the child's birth under the State plan as a targeted low-income pregnant woman in accordance with section 2112 of the Act; and (ii) The child is not eligible for Medicaid under § 435.117 of this chapter. (2)(i) The State may provide coverage under this section to children who are not eligible for Medicaid under § 435.117 from birth until the child's first birthday without application if the requirement in paragraph (b)(2)(ii) of this section is met and if, for the date of the child's birth, the child's mother was eligible for and received covered services under— (A) The State plan as a targeted low-income child; (B) CHIP coverage in another State; or (C) Coverage under the State's demonstration under section 1115 of the Act as a Medicaid or CHIP population. (ii) For purposes of paragraph (b)(2)(i) of this section, the State may only elect the optional populations described if it elects to cover the corresponding optional populations in Medicaid under § 435.117(b)(2)(ii) of this chapter. (3) The child is deemed to have applied and been determined eligible under the State's separate CHIP State plan effective as of the date of birth, and remains eligible regardless of changes in circumstances (except if the child dies or ceases to be a resident of the State or the child's representative requests a voluntary termination of the child's eligibility) until the child's first birthday. (c) CHIP identification number. (2) The State must issue a separate CHIP identification number for the child prior to the effective date of any termination of the mother's eligibility or prior to the date of the child's first birthday, whichever is sooner, except that the State must issue a separate CHIP identification number for the child if the mother was covered in another State at the time of birth. [81 FR 86466, Nov. 30, 2016] § 457.370 Alignment with Exchange initial open enrollment period. The terms of § 435.1205 apply equally to the State in administering a separate CHIP, except that the State shall make available and accept the application described in § 457.330, shall accept electronic accounts as described in § 457.348, and furnish coverage in accordance with § 457.340. [78 FR 42312, July 15, 2013] § 457.380 Eligibility verification. (a) General requirements. (b) Status as a citizen, national or a non-citizen. (i) Verify citizenship or immigration status in accordance with § 435.956(a) of this chapter, except that the reference to § 435.945(k) is read as a reference to paragraph (i) of this section; and (ii) Provide a reasonable opportunity period to verify such status in accordance with § 435.956(a)(5) and (b) of this chapter and provide benefits during such reasonable opportunity period to individuals determined to be otherwise eligible for CHIP. (2) [Reserved] (c) State residents. (d) Income. (e) Verification of other factors of eligibility. (f) Requesting information. (g) Electronic service. (h) Interaction with program integrity requirements. (i) Flexibility in information collection and verification. (j) Verification plan. [77 FR 17216, Mar. 23, 2012, as amended at 81 FR 86466, Nov. 30, 2016] Subpart D—State Plan Requirements: Coverage and Benefits Source: 66 FR 2678, Jan. 11, 2001, unless otherwise noted. § 457.401 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2102(a)(7) of the Act, which requires that States make assurances relating to, the quality and appropriateness of care, and access to covered services; (2) Section 2103 of the Act, which outlines coverage requirements for children's health insurance; (3) Section 2109 of the Act, which describes the relation of the CHIP program to other laws; (4) Section 2110(a) of the Act, which describes child health assistance; and (5) Section 2110(c) of the Act, which contains definitions applicable to this subpart. (b) Scope. (c) Applicability. § 457.402 Definition of child health assistance. For the purpose of this subpart, the term “child health assistance” means payment for part or all of the cost of health benefits coverage provided to targeted low-income children for the following services: (a) Inpatient hospital services. (b) Outpatient hospital services. (c) Physician services. (d) Surgical services. (e) Clinic services (including health center services) and other ambulatory health care services. (f) Prescription drugs and biologicals and the administration of these drugs and biologicals, only if these drugs and biologicals are not furnished for the purpose of causing, or assisting in causing, the death, suicide, euthanasia, or mercy killing of a person. (g) Over-the-counter medications. (h) Laboratory and radiological services. (i) Prenatal care and pre-pregnancy family planning services and supplies. (j) Inpatient mental health services, other than services described in paragraph (r) of this section but including services furnished in a State-operated mental hospital and including residential or other 24-hour therapeutically planned structured services. (k) Outpatient mental health services, other than services described in paragraph (s) of this section but including services furnished in a State-operated mental hospital and including community-based services. (l) Durable medical equipment and other medically-related or remedial devices (such as prosthetic devices, implants, eyeglasses, hearing aids, dental devices and adaptive devices). (m) Disposable medical supplies. (n) Home and community-based health care services and related supportive services (such as home health nursing services, personal care, assistance with activities of daily living, chore services, day care services, respite care services, training for family members and minor modification to the home.) (o) Nursing care services (such as nurse practitioner services, nurse midwife services, advanced practice nurse services, private duty nursing, pediatric nurse services and respiratory care services) in a home, school, or other setting. (p) Abortion only if necessary to save the life of the mother or if the pregnancy is the result of rape or incest. (q) Dental services. (r) Inpatient substance abuse treatment services and residential substance abuse treatment services. (s) Outpatient substance abuse treatment services. (t) Case management services. (u) Care coordination services. (v) Physical therapy, occupational therapy, and services for individuals with speech, hearing and language disorders. (w) Hospice care. (x) Any other medical, diagnostic, screening, preventive, restorative, remedial, therapeutic, or rehabilitative services (whether in a facility, home, school, or other setting) if recognized by State law and only if the service is— (1) Prescribed by or furnished by a physician or other licensed or registered practitioner within the scope of practice as defined by State law; (2) Performed under the general supervision or at the direction of a physician; or (3) Furnished by a health care facility that is operated by a State or local government or is licensed under State law and operating within the scope of the license. (y) Premiums for private health care insurance coverage. (z) Medical transportation. (aa) Enabling services (such as transportation, translation, and outreach services) only if designed to increase the accessibility of primary and preventive health care services for eligible low-income individuals. (bb) Any other health care services or items specified by the Secretary and not excluded under this subchapter. § 457.410 Health benefits coverage options. (a) Types of health benefits coverage. (1) Benchmark coverage in accordance with § 457.420. (2) Benchmark-equivalent coverage in accordance with § 457.430. (3) Existing comprehensive State-based coverage in accordance with § 457.440. (4) Secretary-approved coverage in accordance with § 457.450. (b) Required coverage. (1) Well-baby and well-child care services as defined by the State; (2) Age-appropriate immunizations in accordance with the recommendations of the Advisory Committee on Immunization Practices (ACIP); and (3) Emergency services as defined in § 457.10. § 457.420 Benchmark health benefits coverage. Benchmark coverage is health benefits coverage that is substantially equal to the health benefits coverage in one of the following benefit plans: (a) Federal Employees Health Benefit Plan (FEHBP). (b) State employee plan. (c) Health maintenance organization (HMO) plan. § 457.430 Benchmark-equivalent health benefits coverage. (a) Aggregate actuarial value. (b) Required coverage. (1) Inpatient and outpatient hospital services. (2) Physicians' surgical and medical services. (3) Laboratory and x-ray services. (c) Additional coverage. (2) If the benchmark coverage package used by the State for purposes of comparison in establishing the aggregate actuarial value of the benchmark-equivalent coverage package includes coverage for prescription drugs, mental health services, vision services or hearing services, then the actuarial value of the coverage for each of these categories of service in the benchmark-equivalent coverage package must be at least 75 percent of the value of the coverage for such a category or service in the benchmark plan used for comparison by the State. (3) If the benchmark coverage package does not cover one of the categories of services in paragraph (c)(2) of this section, then the benchmark-equivalent coverage package may, but is not required to, include coverage for that category of service. § 457.431 Actuarial report for benchmark-equivalent coverage. (a) To obtain approval for benchmark-equivalent health benefits coverage described under § 457.430, the State must submit to CMS an actuarial report that contains an actuarial opinion that the health benefits coverage meets the actuarial requirements under § 457.430. The report must also specify the benchmark coverage used for comparison. (b) The actuarial report must state that it was prepared— (1) By an individual who is a member of the American Academy of Actuaries; (2) Using generally accepted actuarial principles and methodologies of the American Academy of Actuaries; (3) Using a standardized set of utilization and price factors; (4) Using a standardized population that is representative of privately insured children of the age of those expected to be covered under the State plan; (5) Applying the same principles and factors in comparing the value of different coverage (or categories of services); (6) Without taking into account any differences in coverage based on the method of delivery or means of cost control or utilization used; and (7) Taking into account the ability of a State to reduce benefits by considering the increase in actuarial value of health benefits coverage offered under the State plan that results from the limitations on cost sharing (with the exception of premiums) under that coverage. (c) The actuary who prepares the opinion must select and specify the standardized set and population to be used under paragraphs (b)(3) and (b)(4) of this section. (d) The State must provide sufficient detail to explain the basis of the methodologies used to estimate the actuarial value or, if requested by CMS, to replicate the State's result. § 457.440 Existing comprehensive State-based coverage. (a) General requirements. (1) Includes coverage of a range of benefits; (2) Is administered or overseen by the State and receives funds from the State; (3) Is offered in the State of New York, Florida or Pennsylvania; and (4) Was offered as of August 5, 1997. (b) Modifications. (1) The program continues to include a range of benefits; (2) The State submits an actuarial report demonstrating that the modification does not reduce the actuarial value of the coverage under the program below the lower of either— (i) The actuarial value of the coverage under the program as of August 5, 1997; or (ii) The actuarial value of a benchmark benefit package as described in § 457.430 evaluated at the time the modification is requested. § 457.450 Secretary-approved coverage. Secretary-approved coverage is health benefits coverage that, in the determination of the Secretary, provides appropriate coverage for the population of targeted low-income children covered under the program. Secretary-approved coverage, for which no actuarial analysis is required, may include, but is not limited to the following: (a) Coverage that is the same as the coverage provided to children under the Medicaid State plan. (b) Comprehensive coverage for children offered by the State under a Medicaid demonstration project approved by the Secretary under section 1115 of the Act. (c) Coverage that either includes the full Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) benefit or that the State has extended to the entire Medicaid population in the State. (d) Coverage that includes benchmark health benefits coverage, as specified in § 457.420, plus any additional coverage. (e) Coverage that is the same as the coverage provided under § 457.440. (f) Coverage, including coverage under a group health plan purchased by the State, that the State demonstrates to be substantially equivalent to or greater than coverage under a benchmark health benefits plan, as specified in § 457.420, through use of a benefit-by-benefit comparison which demonstrates that coverage for each benefit meets or exceeds the corresponding coverage under the benchmark health benefits plan. [66 FR 33823, June 25, 2001] § 457.470 Prohibited coverage. A State is not required to provide health benefits coverage under the plan for an item or service for which payment is prohibited under title XXI even if any benchmark health benefits plan includes coverage for that item or service. § 457.475 Limitations on coverage: Abortions. (a) General rule. (b) Exceptions Life of mother. (2) Rape or incest. (c) Partial Federal funding prohibited. (2) If a State wishes to have managed care entities provide abortions in addition to those specified in paragraph (b) of this section, those abortions must be provided under a separate contract using non-Federal funds. A State may not set aside a portion of the capitated rate paid to a managed care entity to be paid with State-only funds, or append riders, attachments or addenda to existing contracts with managed care entities to separate the additional abortion services from the other services covered by the contract. (3) Nothing in this section affects the expenditure by a State, locality, or private person or entity of State, local, or private funds (other than those expended under the State plan) for any abortion services or for health benefits coverage that includes coverage of abortion services. § 457.476 xxx Link to an amendment published at 91 FR 52474, Aug. 13, 2026. § 457.480 Prohibited coverage limitations, preexisting condition exclusions, and relation to other laws. (a) Prohibited coverage limitations. (b) Preexisting condition exclusions. (2) If the State obtains health benefits coverage through payment or a contract for health benefits coverage under a group health plan or group health insurance coverage, the State may permit the imposition of a pre-existing condition exclusion but only to the extent that the exclusion is permitted under the applicable provisions of part 7 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (ERISA) and title XXVII of the Public Health Service Act. (c) Relation of title XXI to other laws. (2) Health Insurance Portability and Accountability Act (HIPAA). (3) Mental Health Parity Act (MHPA). (4) Newborns and Mothers Health Protection Act (NMHPA). [66 FR 2678, Jan. 11, 2001, as amended at 89 FR 22876, Apr. 2, 2024] § 457.490 Delivery and utilization control systems. A State that elects to obtain health benefits coverage through a separate child health program must include in its State plan a description of the child health assistance provided under the plan for targeted low-income children, including a description of the proposed methods of delivery and utilization control systems. A State must— (a) Describe the methods of delivery of child health assistance including the choice of financing and the methods for assuring delivery of the insurance products and delivery of health care services covered by such products to the enrollees, including any variations; and (b) Describe utilization control systems designed to ensure that enrollees receiving health care services under the State plan receive only appropriate and medically necessary health care consistent with the benefit package described in the approved State plan. § 457.495 State assurance of access to care and procedures to assure quality and appropriateness of care. A State plan must include a description of the methods that a State uses for assuring the quality and appropriateness of care provided under the plan, including how the State will assure: (a) Access to well-baby care, well-child care, well-adolescent care and childhood and adolescent immunizations. (b) Access to covered services, including emergency services as defined at § 457.10. (c) Appropriate and timely procedures to monitor and treat enrollees with chronic, complex, or serious medical conditions, including access to an adequate number of visits to specialists experienced in treating the specific medical condition and access to out-of-network providers when the network is not adequate for the enrollee's medical condition. (d) That decisions related to the prior authorization of health services are completed as follows: (1) Before January 1, 2026. (ii) In accordance with existing State law regarding prior authorization of health services. (2) On or after January 1, 2026. (ii) In accordance with existing State law regarding prior authorization of health services. (3) Enrollee notification. (i) Notice of the State's prior authorization decision; and (ii) Information on the enrollee's right to a review process, in accordance with § 457.1180. (e) Access to and delivery of services in a culturally competent manner to all beneficiaries, as described in 42 CFR 440.262. [66 FR 2678, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001; 89 FR 8982, Feb. 4, 2024; 89 FR 37692, May 6, 2024] § 457.496 Parity in mental health and substance use disorder benefits. (a) Meaning of terms. Aggregate lifetime dollar limit Annual dollar limit Cumulative financial requirements Early and Periodic Screening, Diagnostic and Treatment (EPSDT) benefits Financial requirements Medical/surgical benefits Mental health benefits State Plan Substance use disorder benefits Treatment limitations See (b) State plan providing EPSDT benefits. (i) The State elects in the State child health plan to cover Secretary-approved coverage defined in § 457.450(a) that includes all EPSDT benefits, as defined in section 1905(r) of the Act, in accordance with the requirement applied under section 1905(r)(5) of the Act to provide necessary health care, diagnostic services, treatment, and other measures described in section 1905(a) of the Act to correct or ameliorate defects and physical and mental illnesses and conditions discovered by the screening services, as well as the informing and administrative requirements under 1902(a)(43) of the Act and the approved State Medicaid plan; and (ii) The State child health plan does not exclude EPSDT benefits for any particular condition, disorder, or diagnosis. (2) The child health plan must include a description of how the State will comply with paragraph (b)(1)(i) of this section. (3) If a State has elected in its state plan to cover EPSDT benefits only for certain populations enrolled in the state child health plan, the State is deemed compliant with this section only with respect to such children. (c) Parity requirements for aggregate lifetime and annual dollar limits. (1) Plan with no limit or limits on less than one-third of all medical/surgical benefits. (2) State plans with a limit on at least two-thirds of all medical/surgical benefits. (i) Apply the aggregate lifetime or annual dollar limit both to the medical/surgical benefits to which the limit would otherwise apply and to mental health or substance use disorder benefits in a manner that does not distinguish between the medical/surgical benefits and mental health or substance use disorder benefits; or (ii) Not include an aggregate lifetime or annual dollar limit on mental health or substance use disorder benefits that is more restrictive than the aggregate lifetime or annual dollar limit, respectively, on medical/surgical benefits. (For cumulative limits other than aggregate lifetime or annual dollar limits, see paragraph (d)(3)(iii) of this section prohibiting separately accumulating cumulative financial requirements.) (3) Determining one-third and two-thirds of all medical/surgical benefits. (4) Plan not described in this section In general. (A) Impose no aggregate lifetime or annual dollar limit, as appropriate, on mental health or substance use disorder benefits; or (B) Impose an aggregate lifetime or annual dollar limit on mental health or substance use disorder benefits that is no more restrictive than an average limit calculated for medical/surgical benefits in the following manner. The average limit is calculated by taking into account the weighted average of the aggregate lifetime or annual dollar limits, as appropriate, that are applicable to the categories of medical/surgical benefits. Limits based on delivery systems, such as inpatient/outpatient treatment or normal treatment of common, low-cost conditions (such as treatment of normal births), do not constitute categories for purposes of this paragraph (c)(4)(i)(B). In addition, for purposes of determining weighted averages, any benefits that are not within a category that is subject to a separately-designated dollar limit under the plan are taken into account as a single separate category by using an estimate of the upper limit on the dollar amount that a plan may reasonably be expected to incur for such benefits, taking into account any other applicable restrictions under the plan. (ii) Weighting. (d) Parity requirements for financial requirements and treatment limitations Clarification of terms Classification of benefits. (ii) Type of financial requirement or treatment limitation. See (iii) Level of a type of financial requirement or treatment limitation. (2) General parity requirement General rule. (ii) Classifications of benefits used for applying rules. (A) Inpatient. (B) Outpatient. (C) Emergency care. (D) Prescription drugs. (3) Financial requirements and quantitative treatment limitations Determining “substantially all” and “predominant” Substantially all. (B) Predominant. 1 ( 2 (C) Portion based on plan payments. (D) Clarifications for certain threshold requirements. (E) Determining the dollar amount of State plan payments. (ii) Special rules Multi-tiered prescription drug benefits. (B) Sub-classifications permitted for office visits, separate from other outpatient services. ( 1 ( 2 (iii) No separate cumulative financial requirements. (4) Nonquantitative treatment limitations General rule. (ii) Illustrative list of nonquantitative treatment limitations. (A) Medical management standards limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative; (B) Formulary design for prescription drugs; (C) For plans with multiple network tiers (such as preferred providers and participating providers), network tier design; (D) Standards for provider admission to participate in a network, including reimbursement rates; (E) Plan methods for determining usual, customary, and reasonable charges; (F) Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective (also known as fail-first policies or step therapy protocols); (G) Exclusions based on failure to complete a course of treatment; (H) Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage; and (I) Standards for providing access to out-of-network providers. (5) Application to out-of-network providers. (e) Availability of plan information Criteria for medical necessity determinations. (2) Reason for any denial. (3) Provisions of other law. (f) Applicability State plans. (i) Standard for defining benefits. (A) Medical/surgical benefits. (B) Mental health benefits. (C) Substance use disorder benefits. (ii) [Reserved] (2) Scope. (i) Require a State plan or a MCE that contracts with a State plan to provide any mental health benefits or substance use disorder benefits, and the provision of benefits by a State plan or a MCE that contracts with a State plan for one or more mental health conditions or substance use disorders does not require the plan or health insurance coverage under this section to provide benefits for any other mental health condition or substance use disorder; (ii) Affect the terms and conditions relating to the amount, duration, or scope of mental health or substance use disorder benefits under the State plan or a MCE that contracts with a CHIP State plan except as specifically provided in paragraphs (c) and (d) of this section. (g) Compliance dates In general. (2) [Reserved] [81 FR 18842, Mar. 30, 2016] Subpart E—State Plan Requirements: Enrollee Financial Responsibilities Source: 66 FR 2681, Jan. 11, 2001, unless otherwise noted. § 457.500 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2101(a) of the Act, which provides that the purpose of title XXI is to provide funds to States to enable them to initiate and expand the provision of child health assistance to uninsured, low-income children in an effective and efficient manner; and (2) Section 2103(e) of the Act, which sets forth provisions regarding State plan requirements and options for cost sharing. (b) Scope. (c) Applicability. § 457.505 General State plan requirements. The State plan must include a description of— (a) The amount of premiums, deductibles, coinsurance, copayments, and other cost sharing imposed; (b) The methods, including the public schedule, the State uses to inform enrollees, applicants, providers and the general public of the cost-sharing charges, the cumulative cost-sharing maximum, and any changes to these amounts; (c) The disenrollment protections as required under § 457.570; (d) In the case of coverage obtained through premium assistance for group health plans— (1) The procedures the State uses to ensure that eligible children are not charged copayments, coinsurance, deductibles or similar fees on well-baby and well-child care services described at § 457.520, and that any cost sharing complies with the requirements of this subpart; (2) The procedures to ensure that American Indian and Alaska Native children are not charged premiums, copayments, coinsurance, deductibles, or similar fees in accordance with § 457.535; (3) The procedures to ensure that eligible children are not charged cost sharing in excess of the cumulative cost-sharing maximum specified in § 457.560. (e) Procedures that do not primarily rely on a refund given by the State for overpayment on behalf of an eligible child to ensure compliance with this subpart. [66 FR 2681, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] § 457.510 Premiums, enrollment fees, or similar fees: State plan requirements. When a State imposes premiums, enrollment fees, or similar fees on enrollees, the State plan must describe— (a) The amount of the premium, enrollment fee or similar fee imposed on enrollees; (b) The time period for which the charge is imposed; (c) The group or groups that are subject to the premiums, enrollment fees, or similar charges; (d) The consequences for an enrollee or applicant who does not pay a charge, and the disenrollment protections adopted by the State in accordance with § 457.570; and (e) The methodology used to ensure that total cost-sharing liability for a family does not exceed the cumulative cost-sharing maximum specified in § 457.560. § 457.515 Co-payments, coinsurance, deductibles, or similar cost-sharing charges: State plan requirements. To impose copayments, coinsurance, deductibles or similar charges on enrollees, the State plan must describe— (a) The service for which the charge is imposed; (b) The amount of the charge; (c) The group or groups of enrollees that may be subject to the cost-sharing charge; (d) The consequences for an enrollee who does not pay a charge, and the disenrollment protections adopted by the State in accordance with § 457.570; (e) The methodology used to ensure that total cost-sharing liability for a family does not exceed the cumulative cost-sharing maximum specified in § 457.560; and (f) An assurance that enrollees will not be held liable for cost-sharing amounts for emergency services that are provided at a facility that does not participate in the enrollee's managed care network beyond the copayment amounts specified in the State plan for emergency services as defined in § 457.10. § 457.520 Cost sharing for well-baby and well-child care services. (a) A State may not impose copayments, deductibles, coinsurance or other cost sharing with respect to the well-baby and well-child care services covered under the State plan in either the managed care delivery setting or the fee-for-service delivery setting. (b) For the purposes of this subpart, at a minimum, any of the following services covered under the State plan will be considered well-baby and well-child care services: (1) All healthy newborn physician visits, including routine screening, whether provided on an inpatient or outpatient basis. (2) Routine physical examinations as recommended and updated by the American Academy of Pediatrics (AAP) “Guidelines for Health Supervision III” and described in “Bright Futures: Guidelines for Health Supervision of Infants, Children and Adolescents.” (3) Laboratory tests associated with the well-baby and well-child routine physical examinations as described in paragraph (b)(2) of this section. (4) Immunizations and related office visits as recommended and updated by the Advisory Committee on Immunization Practices (ACIP). (5) Routine preventive and diagnostic dental services (such as oral examinations, prophylaxis and topical fluoride applications, sealants, and x-rays) as described in the most recent guidelines issued by the American Academy of Pediatric Dentistry (AAPD). § 457.525 Public schedule. (a) The State must make available to the groups in paragraph (b) of this section a public schedule that contains the following information: (1) Current cost-sharing charges. (2) Enrollee groups subject to the charges. (3) Cumulative cost-sharing maximums. (4) Mechanisms for making payments for required charges. (5) The consequences for an applicant or an enrollee who does not pay a charge, including the disenrollment protections required by § 457.570. (b) The State must make the public schedule available to the following groups: (1) Enrollees, at the time of enrollment and reenrollment after a redetermination of eligibility, and when cost-sharing charges and cumulative cost-sharing maximums are revised. (2) Applicants, at the time of application. (3) All participating providers. (4) The general public. § 457.530 General cost-sharing protection for lower income children. The State may vary premiums, deductibles, coinsurance, copayments or any other cost sharing based on household income only in a manner that does not favor children from families with higher income over children from families with lower income. § 457.535 Cost-sharing protection to ensure enrollment of American Indians and Alaska Natives. States may not impose premiums, deductibles, coinsurance, copayments or any other cost-sharing charges on children who are American Indians or Alaska Natives, as defined in § 457.10. § 457.540 Cost-sharing charges for children in families with incomes at or below 150 percent of the FPL. The State may impose premiums, enrollment fees, deductibles, copayments, coinsurance, cost sharing and other similar charges for children whose household income is at or below 150 percent of the FPL as long as— (a) Aggregate monthly enrollment fees, premiums, or similar charges imposed on a family are less than or equal to the maximum amounts permitted under § 447.52, § 447.53, or § 447.54 of this chapter for a Medicaid eligible family of the same size and income; (b) Any copayments, coinsurance, deductibles or similar charges for children whose household income is at or below 100 percent of the FPL are equal to or less than the amounts permitted under § 447.54 of this chapter; (c) For children whose household income is from 101 percent to 150 percent of the FPL, any copayments, coinsurance, deductibles or similar charges are equal to or less than the maximum amounts permitted under § 457.555; (d) The State does not impose more than one type of cost-sharing charge (deductible, copayment, or coinsurance) on a service; (e) The State only imposes one copayment based on the total cost of services furnished during one office visit; and (f) Aggregate annual cost sharing of all types, with respect to all targeted low-income children in a family, does not exceed the maximum permitted under § 457.560(a). [66 FR 2681, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001; 78 FR 42312, July 15, 2013] § 457.555 Maximum allowable cost-sharing charges on targeted low-income children in families with income from 101 to 150 percent of the FPL. (a) Non-institutional services. (1)(i) For Federal FY 2009, any co-payment or similar charge the State imposes under a fee-for-service delivery system may not exceed the amounts shown in the following table: State payment for the service Maximum $15 or less $1.15 $15.01 to $40 $2.30 $40.01 to $80 $3.40 $80.01 or more $5.70 (ii) Thereafter, any copayments may not exceed these amounts as updated each October 1 by the percentage increase in the medical care component of the CPI-U for the period of September to September ending in the preceding calendar year and then rounded to the next higher 5-cent increment. (2) For Federal FY 2009, any co-payment that the State imposes for services provided by a managed care organization may not exceed $5.70 per visit. In succeeding years, any copayment may not exceed this amount as updated each October 1 by the percentage increase in the medical care component of the CPI-U for the period of September to September ending in the preceding calendar year and then rounded to the next higher 5-cent increment. (3) Any coinsurance rate the State imposes may not exceed 5 percent of the payment the State directly or through contract makes for the service; and (4) For Federal FY 2009, any deductible the State imposes may not exceed $3.40 per month, per family for each period of eligibility. Thereafter, any deductible may not exceed this amount as updated each October 1 by the percentage increase in the medical care component of the CPI-U for the period of September to September ending in the preceding calendar year and then rounded to the next higher 5-cent increment. (b) Institutional services. (c) Institutional emergency services. (d) Non-emergency use of the emergency room. (e) Standard copayment amount. [66 FR 2681, Jan. 11, 2001, as amended at 73 FR 71854, Nov. 25, 2008; 75 FR 30265, May 28, 2010] § 457.560 Cumulative cost-sharing maximum. (a) A State may not impose premiums, enrollment fees, copayments, coinsurance, deductibles, or similar cost-sharing charges that, in the aggregate, exceed 5 percent of a family's total income for the length of a child's eligibility period in the State. (b) The State must inform the enrollee's family in writing and orally if appropriate of their individual cumulative cost-sharing maximum amount at the time of enrollment and reenrollment. [66 FR 2681, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] § 457.570 Disenrollment protections. (a) The State must give enrollees reasonable notice of and an opportunity to pay past due premiums, copayments, coinsurance, deductibles or similar fees prior to disenrollment. (b) The disenrollment process must afford the enrollee an opportunity to show that the enrollee's household income has declined prior to disenrollment for non payment of cost-sharing charges, and in the event that such a showing indicates that the enrollee may have become eligible for Medicaid or for a lower level of cost sharing, the State must facilitate enrolling the child in Medicaid or adjust the child's cost-sharing category as appropriate. (c) The State must ensure that disenrollment policies, such as policies related to non-payment of premiums, do not present barriers to the timely determination of eligibility and enrollment in coverage of an eligible child in the appropriate insurance affordability program. A State may not— (1) Impose a specified period of time that a CHIP eligible targeted low-income child or targeted low-income pregnant woman who has an unpaid premium or enrollment fee will not be permitted to reenroll for coverage in CHIP. (2) Require the collection of past due premiums or enrollment fees as a condition of eligibility for reenrollment if an individual was terminated for failure to pay premiums. (d) The State must provide the enrollee with an opportunity for an impartial review to address disenrollment from the program in accordance with § 457.1130(a)(3). [66 FR 2681, Jan. 11, 2001, as amended at 78 FR 42312, July 15, 2013; 89 FR 22876, Apr. 2, 2024] Subpart F—Payments to States § 457.600 Purpose and basis of this subpart. This subpart interprets and implements— (a) Section 2104 of the Act which specifies the total allotment amount available for allotment to each State for child health assistance for fiscal years 1998 through 2015, the formula for determining each State allotment for a fiscal year, including the Commonwealth and Territories, and the amounts of payments for expenditures that are applied to reduce the State allotments. (b) Section 2105 of the Act which specifies the provisions for making payment to States, the limitations and conditions on such payments, and the calculation of the enhanced Federal medical assistance percentage. [66 FR 2670, Jan. 11, 2001, as amended at 76 FR 9246, Feb. 17, 2011] § 457.602 Applicability. The provisions of this subpart apply to the 50 States and the District of Columbia, and the Commonwealths and Territories. § 457.606 Conditions for State allotments and Federal payments for a fiscal year. (a) Basic conditions. (1) For fiscal years 1998 and 1999, the State child health plan must be approved before October 1, 1999; (2) For fiscal years after 1999, the State child health plan must be approved by the end of the fiscal year; (3) An allotment for a fiscal year is not available to a State prior to the beginning of the fiscal year; and (4) Federal payments out of an allotment are based on State expenditures which are allowable under the approved State child health plan. (b) Federal payments for Children's Health Insurance Program (CHIP) expenditures under an approved State child health plan are— (1) Limited to the amount of available funds remaining in State allotments calculated in accordance with the allotment process and formula specified in §§ 457.608 and 457.610, and payment process in §§ 457.614 and 457.616. (2) Available based on a percentage of State CHIP expenditures, at a rate equal to the enhanced Federal medical assistance percentage (FMAP) for each fiscal year, calculated in accordance with § 457.622. (3) Available through the grants process specified in § 457.630. [65 FR 33622, May 24, 2000, as amended at 75 FR 48852, Aug. 11, 2010] § 457.608 Process and calculation of State allotments prior to FY 2009. (a) General (2) In order to determine each State allotment, CMS determines the national total allotment amount for each fiscal year available to the 50 States and the District of Columbia, as described in paragraph (c) of this section, and the total allotment amount available for each fiscal year for allotment to the Commonwealths and Territories, as described in paragraph (d) of this section. (3) The amount of allotments redistributed under section 2104(f) of the Act will not be applied or taken into account in determining the amounts of a fiscal year allotment for a State and the District of Columbia under this section. (b) Definition of Proportion. proportion (c) National total allotment amount for the 50 States and the District of Columbia. (i) The total allotment amount available for allotment for each fiscal year to the Commonwealths and Territories, as determined in paragraph (d)(1) of this section; (ii) The total amount of the grant for the fiscal year for children with Type I Diabetes under Section 4921 of Public Law 105-33. This is $30,000,000 for each of the fiscal years 1998 through 2002; and (iii) The total amount of the grant for the fiscal year for diabetes programs for Indians under Section 4922 of Public Law 105-33. This is $30,000,000 for each of the fiscal years 1998 through 2002. (2) The following formula illustrates the calculation of the national total allotment amount available for allotment to the 50 States and the District of Columbia for a fiscal year: A TA 2104(a) 2104(c) 4921 4922 A TA S 2104(a) T 2104(c) D 4921 (d) Total allotment amount available to the Commonwealths and Territories General. (2) Additional amounts for allotment to the Commonwealths and Territories. (e) Determination of State allotments for a fiscal year General. (i) The proportion for the State or the District of Columbia for the fiscal year, as defined in paragraph (b) of this section, and determined after application of the provisions of paragraphs (e)(2) and (3), related to the preadjusted proportion, and the floors, ceilings, and reconciliation process, respectively; and (ii)(A) The national total allotment amount available for allotment for the fiscal year, as specified in paragraph (c) of this section. The State and the District of Columbia's allotment for a fiscal year is determined in accordance with the following general formula: SA i i TA SA i P i A TA (B) There are two steps for determining the proportion for a State and the District of Columbia. The first step determines the preadjusted proportions, and is described under paragraph (e)(2) of this section. The first step applies in determining the proportion for all fiscal years. The second step applies floors and ceilings and, if necessary, applies a reconciliation to the preadjusted proportion. The second step is described in paragraph (e)(3) of this section. The second step applies in determining the proportion only for FY 2000 and subsequent fiscal years. For FY 1998 and FY 1999, the preadjusted proportion is the State or District of Columbia's proportion for the fiscal year. (2) Determination of the Preadjusted Proportions for a Fiscal Year. PP i i i i i PP i C i Number of children (ii) For each of the fiscal years 1998 and 1999, the number of children is equal to the number of low-income children in the State for the fiscal year with no health insurance coverage. For fiscal year 2000, the number of children is equal to the sum of 75 percent of the number of low-income children in the State for the fiscal year with no health insurance coverage and 25 percent of the number of low-income children in the State for the fiscal year. For fiscal years 2001 and thereafter, the number of children is equal to the sum of 50 percent of the number of low-income children in the State for the fiscal year with no health insurance coverage and 50 percent of the number of low-income children in the State for the fiscal year. (section 2104(b)(2)(A) of the Act). SCF i State cost factor for a State i N W i W N Σ(C i i i i A TA (3) Application of floors and ceilings and reconciliation in determining proportion Floors and ceilings in proportions. (A) The proportion floors, or minimum proportions, that apply in determining a State's proportion for the fiscal year are: ( 1 ( 2 ( 3 (B) The proportion ceiling, or maximum proportion, for a fiscal year that applies in determining the State's fiscal year proportion is 145 percent of the State's proportion for FY 1999. (ii) Reconciliation of State proportions. (A) If, after the application of the floors and ceilings under paragraphs (e)(3)(i)(A) and (B) of this section, the sum of the States' proportions is greater than one, the Secretary will establish a maximum percentage increase in States' proportions, such that when applied to the States' proportions, the sum of the proportions is exactly equal to one. (B) If, after the application of the floors and ceilings under paragraphs (e)(3)(i)(A) and (B), the sum of the proportions is less than one, the Secretary will increase States' proportions (as computed before the application of the floors under paragraph (e)(3)(i)(A)) in a pro rata manner (but not to exceed the 145 percent ceiling computed under paragraph (e)(3)(i)(B)), such that when applied to the States' proportions, the sum of the proportions is exactly equal to one. (4) Data used for calculating the FY 1998 CHIP allotments. (5) Data used for calculating the FY 1999 CHIP allotments. (f) Methodology for determining the Commonwealth and Territory allotments for a fiscal year. Puerto Rico—91.6% Guam—3.5% Virgin Islands—2.6% American Samoa—1.2% Northern Mariana Islands—1.1% (g) Reserved State allotments for a fiscal year. Federal Register (2) For FY 1998 and FY 1999, CMS determined and published the State reserved allotments using the available data described in paragraphs (e)(4) and (e)(5) of this section, respectively, on the basis of the statutory allotment formula as it existed prior to the enactment of Public Law 106-113. (3) If all States, the District of Columbia, and the Commonwealths and Territories have approved State child health plans in place prior to the beginning of the fiscal year, as appropriate, CMS may publish the allotments as final in the Federal Register, (h) Final allotments. (2) Final State allotments for a fiscal year after FY 1999 for each State, the District of Columbia, and the Commonwealths and Territories are determined by CMS based only on those States, the District of Columbia, and the Commonwealths and Territories that have approved State child health plans by the end of the fiscal year, in accordance with the formula and methodology specified in paragraphs (a) through (g) of this section. (3) CMS determines and publishes the States' final fiscal year allotments in the Federal Register [66 FR 2670, Jan. 11, 2001, as amended at 76 FR 9246, Feb. 17, 2011] § 457.609 Process and calculation of State allotments for a fiscal year after FY 2008. (a) General. (b) Amounts available for allotment. (1) FY 2009: $10,562,000,000. (2) FY 2010: $12,520,000,000. (3) FY 2011: $13,459,000,000. (4) FY 2012: $14,982,000,000. (5) FY 2013: $17,406,000,000. (6) FY 2014: $19,147,000,000. (7) FY 2015, for the period beginning October 1, 2014 and ending March 31, 2015, the following amounts are available for allotment: (i) $2,850,000,000. (ii) 15,361,000,000. (8) FY 2015, for the period beginning April 1, 2013 and ending on September 30, 2013, $2,850,000,000. (c) Determination of a State allotment for FY 2009 For the 50 States and the District of Columbia. (i) The total Federal payments to the State under title XXI of the Act for FY 2008 as reported by the State and certified to the Secretary through the November 2008 submission of the quarterly expenditure reports, Forms CMS-21 (OMB # 0938-0731) and CMS-64 (OMB # 0938-0067), multiplied by the allotment increase factor determined under paragraph (f) of this section. (ii) The amount allotted to the State for FY 2008, multiplied by the allotment increase factor determined under paragraph (f) of this section; (iii) The projected total Federal payments to the State under title XXI of the Act for FY 2009, subject to paragraph (c)(1)(iv) of this section, as determined based on the February 2009 projections certified by the State to CMS by no later than March 31, 2009. (iv) In the case of a State described in section 2105(g) of the Act and electing the option under paragraph (4) of such section, for purposes of the projections described in paragraph (c)(1)(iii) of this section, such projections would include an amount equal to the difference between the following amounts: (A) the amount of Federal payments for the expenditures described in section 2105(g)(4)(B) of the Act made after February 4, 2009 that would have been paid to the State if claimed at the enhanced Federal medical assistance percentage determined under section 2105(b) of the Act. (B) the amount of Federal payments for the expenditures described in section 2105(g)(4)(B) of the Act made after February 4, 2009 that would have been paid to the State if claimed at the Federal medical assistance percentage defined in section 1905(b) of the Act; during the recession adjustment period described in section 5001(h) of the American Recovery and Reinvestment Act of 2009 (ARRA), as amended the Federal medical assistance percentage is as determined for the State under section 5001 of ARRA. (2) For the Commonwealths or Territories. (ii) Additional Amounts for FY 2009. (A) For Puerto Rico, 91.6 percent. (B) For Guam, 3.5 percent. (C) For the Virgin Islands, 2.6 percent. (D) For American Samoa, 1.2 percent. (E) For the Northern Mariana Islands, 1.1 percent. (3) Coordination of CHIP Funding for FY 2009. (d) Determination of a State allotment for FY 2010 through FY 2015 General. (2) Determination of a State Allotment for FY 2010. (A) The sum of: ( 1 ( 2 ( 3 ( 4 (B) The State allotment increase factor for FY 2010 as determined under paragraph (f) of the section. (ii) In determining the amount of the FY 2010 allotment for each Commonwealth and Territory, for purposes of determining the amount of the FY 2009 allotment under paragraph (d)(2)(i)(A)(1) of this section, the amount of such FY 2009 allotment will not include the additional amount determined under paragraph (c)(2)(ii). (3) Determination of a State Allotment for FY 2011. (i) The amount of Federal payments attributable and countable toward the available State allotments in FY 2010, including: (A) Any amount redistributed to the State in FY 2010, and (B) Any Federal payments made as contingency fund payments for FY 2010 under section 2104(n) of the Act. (ii) The State allotment increase factor for FY 2011 as determined under paragraph (f) of the section. (4) Determination of a State Allotment for FY 2012. (i) The sum of: (A) The State Allotment for FY 2011, as determined under paragraph (d)(3) of this section. (B) The amount of any Federal payments made as contingency fund payments for FY 2011 under section 2104(n) of the Act. (ii) The State allotment increase factor for FY 2012 as determined under paragraph (f) of this section. (5) Determination of a State Allotment for FY 2013. (i) The amount of Federal payments attributable and countable toward the available State allotments in FY 2012, including: (A) Any amount redistributed to the State in FY 2012, and (B) Any Federal payments made as contingency fund payments for FY 2012 under section 2104(n) of the Act. (ii) The State allotment increase factor for FY 2013 as determined under paragraph (f) of the section. (6) Determination of a State Allotment for FY 2014. (i) The sum of: (A) The State Allotment for FY 2013, as determined under paragraph (d)(5) of this section. (B) The amount of any Federal payments made as contingency fund payments for FY 2013 under section 2104(n) of the Act. (ii) The State allotment increase factor for FY 2014 as determined under paragraph (f) of this section. (7) Determination of a State Allotment for FY 2015 General. (ii) The State allotment for FY 2015 for the period October 1, 2014 and ending March 31, 2015 is determined as the product of the following: (A) The first half ratio determined as the amount in paragraph (d)(7)(ii)(A)( 1 2 ( 1 ( 2 1 (B) The product of: ( 1 ( i ( ii ( 2 (iii) The State allotment for FY 2015 for the period April 1, 2015 and ending September 30, 2015 is determined as the product of the following: (A) $2,850,000,000 the amount in paragraph (b)(8) of this section, as appropriated in section 2104(a)(18)(B) of the Act; and (B) The ratio determined as the amount in paragraph (d)(7)(iii)(B)( 1 2 ( 1 ( 2 (e) Proration. (2) The amount of the allotment for each of the 50 States and the District of Columbia, and for each of the Commonwealths and Territories (not including the additional amount for FY 2009 determined in paragraph (c)(2)(ii) of this section) is equal to the product of: (i) The percentage determined by dividing the amount in paragraph (e)(2)(i)(A) by the amount in paragraph (e)(2)(i)(B) of this section. (A) The amount of the State allotment for each of the 50 States and the District of Columbia, and for each of the Commonwealths and Territories (not including the additional amount for FY 2009 determined under paragraph (c)(2)(ii) of this section). (B) The sum of the amounts for each of the 50 States and the District of Columbia, and the Commonwealths and Territories in paragraph (e)(2)(i) of this section. (ii) The total amount available for allotment for the fiscal year under paragraph (b) of this section. (f) Allotment increase factor. (1) Per capita health care growth factor. The per capita health care growth factor for a fiscal year is equal to 1 plus the percentage increase in the projected per capita amount of the National Health Expenditures from the calendar year in which the previous fiscal year ends to the calendar year in which the fiscal year involved ends, as most recently published by CMS before the beginning of the fiscal year involved. (2) Child Population Growth Factor (g) Increase in State allotment for the 50 States and the District of Columbia for FY 2010 through FY 2015 to account for approved program expansions. (1) The State has submitted to the Secretary, and has approved by the Secretary a State plan amendment or waiver request relating to an expansion of eligibility for children or benefits under title XXI of the Act that becomes effective for a fiscal year (beginning with FY 2010 and ending with FY 2015). (2) The State has submitted to the Secretary, before the August 31 preceding the beginning of the fiscal year, a request for an expansion allotment adjustment under this paragraph for such fiscal year that specifies. (i) The additional expenditures that are attributable to the eligibility or benefit expansion provided under the amendment or waiver described in paragraph (g)(1) of this section, as certified by the State and submitted to the Secretary by not later than August 31 preceding the beginning of the fiscal year. (ii) The extent to which such additional expenditures are projected to exceed the allotment of the State or District for the year. (3) Subject to paragraph (e) of this section relating to proration, the amount of the allotment of the State or District under this section for such fiscal year shall be increased by the excess amount described in paragraph (g)(2)(i)of this section. A State or District may only obtain an increase under paragraph (g)(2)(ii) of this section for an allotment for FY 2010, FY 2012, or FY 2014. (h) CHIP fiscal year allotment process. Medicaid.gov [76 FR 9246, Feb. 17, 2011, as amended at 89 FR 13947, Feb. 23, 2024] § 457.610 Period of availability for State allotments prior to FY 2009. The amount of a final allotment prior to FY 2009, as determined under § 457.608(h) and reduced to reflect certain Medicaid expenditures in accordance with § 457.616, remains available until expended for Federal payments based on expenditures claimed during a 3-year period of availability, beginning with the fiscal year of the final allotment and ending with the end of the second fiscal year following the fiscal year. [66 FR 2670, Jan. 11, 2001, as amended at 76 FR 9249, Feb. 17, 2011] § 457.611 Period of availability for State allotments for a fiscal year after FY 2008. The amount of a final allotment for a fiscal year after FY 2008, as determined under § 457.609 and reduced to reflect certain Medicaid expenditures in accordance with § 457.616, remains available until expended for Federal payments based on expenditures claimed during a 2-year period of availability, beginning with the fiscal year of the final allotment and ending with the end of the succeeding fiscal year following the fiscal year. (Authority: Section 1102 of the Social Security Act (42 U.S.C. 1302). [76 FR 9249, Feb. 17, 2011] § 457.614 General payment process. (a) A State may make claims for Federal payment based on expenditures incurred by the State prior to or during the period of availability related to that fiscal year. (b) In order to receive Federal financial participation (FFP) for a State's claims for payment for the State's expenditures, a State must— (1) Submit budget estimates of quarterly funding requirements for Medicaid and the Children's Health Insurance Programs; and (2) Submit an expenditure report. (c) Based on the State's quarterly budget estimates, CMS— (1) Issues an advance grant to a State as described in § 457.630; (2) Tracks and applies Federal payments claimed quarterly by each State, the District of Columbia, and each Commonwealth and Territory to ensure that payments do not exceed the applicable allotments for the fiscal year; and (3) Track and apply relevant State, District of Columbia, Commonwealth and Territory expenditures reported each quarter against the 10 percent limit on expenditures other than child health assistance for standard benefit package, on a fiscal year basis as specified in § 457.618. [65 FR 33622, May 24, 2000, as amended at 75 FR 48852, Aug. 11, 2010] § 457.616 Application and tracking of payments against the fiscal year allotments. (a) Categories of payments applied to reduce the State allotments. (1) Payments made to the State for expenditures claimed during the fiscal year under its title XIX Medicaid program, to the extent the payments were made on the basis of the enhanced FMAP described in sections 1905(b) and 2105(b) of the Act for expenditures attributable to children described in section 1905(u)(2) of the Act. (2) Payments made to the State for expenditures claimed during the fiscal year under its title XIX Medicaid program, to the extent the payments were made on the basis of the enhanced FMAP described in sections 1905(b) and 2105(b) of the Act for expenditures attributable to children described in section 1905(u)(3) of the Act. (3) [Reserved] (4) Payments made to a State under its title XXI State Children's Health Insurance Program with respect to section 2105(a) of the Act for expenditures claimed by the State during a fiscal year. (b) Application of principles. (1) Coordinate the application of the payments made to a State for the State's expenditures claimed under the Medicaid and State Children's Health Insurance programs against the State allotment for a fiscal year; (2) Determine the order of these payments in that application; and (3) Determine the application of payments against multiple State Child Health Insurance Program fiscal year allotments. (c) Principles for applying Federal payments against the allotment. (1) Applies the payments attributable to Medicaid expenditures specified in paragraphs (a)(1) through (a)(3) of this section, against the State child health plan allotment for a fiscal year before State child health plan expenditures specified in paragraph (a)(4) of this section are applied. (2) Applies the payments attributable to Medicaid and State child health plan expenditures specified in paragraph (a) of this section against the applicable allotments for a fiscal year based on the quarter in which the expenditures are claimed by the State. (3) Applies payments against the State allotments for a fiscal year in a manner that is consistent for all States. (4) Applies payments attributable to Medicaid expenditures specified in paragraphs (a)(1) through (a)(3) of this section, in an order that maximizes Federal reimbursement for States. Expenditures for which the enhanced FMAP is available are applied before expenditures for which the regular FMAP is available. (5) Applies payments for expenditures against State Child Health Insurance Program fiscal year allotments in the least administratively burdensome, and most effective and efficient manner; payments are applied on a quarterly basis as they are claimed by the State, and are applied to reduce the earliest fiscal year State allotments before the payments are applied to reduce later fiscal year allotments. (6) Subject to paragraphs (c)(6)(i) and (ii) of this section, applies payments for expenditures for a fiscal year's allotment against a subsequent fiscal year's allotment; however, the subsequent fiscal year's allotment must be available at the time of application. For example, if the allotment for fiscal year 1998 has been fully expended, payments for expenditures claimed in fiscal year 1998 are carried over for application against the fiscal year 1999 allotment when it becomes available. (i) In accordance with § 457.618, the amount of non-primary expenditures that are within the 10 percent limit for the fiscal year for which they are claimed may be applied against a fiscal year allotment or allotments available in a subsequent fiscal year. (ii) In accordance with § 457.618, the amounts of non-primary expenditures that exceed the 10 percent limit for the fiscal year for which they are claimed may not be applied against a fiscal year allotment or allotments available in a subsequent fiscal year. (7) Carries over unexpended amounts of a State's allotment for a fiscal year for use in subsequent fiscal years through the end of the 3-year period of availability. For example, if the amounts of the fiscal year 1998 allotment are not fully expended by the end of fiscal year 1998, these amounts are carried over to fiscal year 1999 and are available to provide FFP for expenditures claimed by the State for that fiscal year. (d) Amount of Federal payment for expenditures claimed. [65 FR 33622, May 24, 2000, as amended at 81 FR 86466, Nov. 30, 2016] § 457.618 Ten percent limit on certain Children's Health Insurance Program expenditures. (a) Expenditures Primary expenditures (2) Non-primary expenditures (i) Administrative expenditures; (ii) Outreach; (iii) Health initiatives; and (iv) Certain other child health assistance. (b) Federal payment. (c) 10 Percent Limit. (1) Applied on an annual fiscal year basis; (2) Calculated based on the total computable expenditures claimed by the State on quarterly expenditure reports submitted for a fiscal year. Expenditures claimed on a quarterly report for a different fiscal year may not be used in the calculation; and (3) Calculated using the following formula: L10% = ( a1 + u2 + u3 L10% = 10 Percent Limit for a fiscal year a1 u2 u3 (d) The expenditures under section 2105(a)(2) of the Act that are subject to the 10 percent limit are applied— (1) On an annual fiscal year basis; and (2) Against the 10 percent limit in the fiscal year for which the State submitted a quarterly expenditure report including the expenditures. Expenditures claimed on a quarterly report for one fiscal year may not be applied against the 10 percent limit for any other fiscal year. (e)(1) The 10 percent limit for a fiscal year, as calculated under paragraph (c)(3) of this section, may be no greater than 10 percent of the total computable amount (determined under paragraph (e)(2) of this section) of the State allotment or allotments available in that fiscal year. Therefore, the 10 percent limit is the lower of the amount calculated under paragraph (c)(3) of this section, and 10 percent of the total computable amount of the State allotment available in that fiscal year. (2) As used in paragraph (e)(1) of this section, the total computable amount of a State's allotment for a fiscal year is determined by dividing the State's allotment for the fiscal year by the State's enhanced FMAP for the year. For example, if a State allotment for a fiscal year is $65 million and the enhanced FMAP rate for the fiscal year is 65 percent, the total computable amount of the allotment for the fiscal year is $100 million ($65 million/.65). In this example, the 10 percent limit may be no greater than a total computable amount of $10 million (10 percent of $100 million). [65 FR 33622, May 24, 2000, as amended at 75 FR 48852, Aug. 11, 2010] § 457.622 Rate of FFP for State expenditures. (a) Basis. (b) Enhanced Federal medical assistance percentage (Enhanced FMAP)—Computations. (1) 70 percent of the regular FMAP determined under section 1905(b) of the Act, plus 30 percentage points; or (2) 85 percent. (c) Conditions for availability of enhanced FMAP based on a State's expenditures (1) The State has an approved title XXI State child health plan; (2) The expenditures are allowable under the State's approved title XXI State child health plan; (3) State allotment amounts are available in the fiscal year, that is, the State's allotment or allotments (as reduced in accordance with § 457.616) remain available for a fiscal year and have not been fully expended. (4) Expenditures claimed against the 10 percent limit are within the State's 10 percent limit for the fiscal year. (5) For States that elect to extend eligibility to unborn children under the approved Child Health Plan, the State does not adopt eligibility standards and methodologies for purposes of determining a child's eligibility under the Medicaid State plan that were more restrictive than those applied under policies of the State plan in effect on June 1, 1997. This limitation applies also to more restrictive standards and methodologies for determining eligibility for services for a child based on the eligibility of a pregnant woman. (d) Categories of expenditures for which enhanced FMAP are available. (1) Child health assistance under the plan for targeted low-income children in the form of providing health benefits coverage that meets the requirements of section 2103 of the Act; and (2) Subject to the 10 percent limit provisions under § 457.618(a)(2), the following expenditures: (i) Payment for other child health assistance for targeted low-income children; (ii) Expenditures for health services initiatives under the State child health assistance plan for improving the health of children (including targeted low-income children); (iii) Expenditures for outreach activities; and (iv) Other reasonable costs incurred by the State to administer the State child health assistance plan. (e) CHIP administrative expenditures and CHIP related title XIX administrative expenditures General rule. (2) Exception. (3) FFP is not available in expenditures for administrative activities for items or services included within the scope of another claimed expenditure. (4) FFP is available in expenditures for activities defined in sections 2102(c)(1) and 2105(a)(2)(C) of the Act as outreach to families of children likely to be eligible for child health assistance under the plan or under other public or private health coverage programs to inform these families of the availability of, and to assist them in enrolling their children in such a program. (5) FFP is available in administrative expenditures for activities specified in sections 2102(c)(2) of the Act as coordination of the administration of the Children's Health Insurance Program with other public and private health insurance programs. FFP would not be available for the costs of administering the other public and private health insurance programs. Coordination activities must be distinguished from other administrative activities common among different programs. [65 FR 33622, May 24, 2000, as amended at 67 FR 61974, Oct. 2, 2002; 75 FR 48852, Aug. 11, 2010] § 457.626 Prevention of duplicate payments. (a) General rule. (1) A non-governmental health insurer would have been obligated to pay for those services but for a provision of its insurance contract that has the effect of limiting or excluding those obligations based on the actual or potential eligibility of the individual for child health assistance under the State child health insurance plan. (2) Payment has been made or can reasonably be expected to be made promptly under any other Federally operated or financed health insurance or benefits program, other than a program operated or financed by the Indian Health Service. (3) Services are for an unborn child and are payable under Medicaid as a service to an eligible pregnant woman under that program. (b) Definitions. Non-governmental health insurer Prompt payment Programs operated or financed by the Indian Health Service et seq. et seq. [65 FR 33622, May 24, 2000, as amended at 67 FR 61974, Oct. 2, 2002] § 457.628 Other applicable Federal regulations. Other regulations applicable to CHIP programs include the following: (a) HHS regulations in §§ 431.800 through 431.1010 of this chapter (related to the PERM and MEQC programs); §§ 433.312 through 433.322 of this chapter (related to Overpayments); § 433.38 of this chapter (Interest charge on disallowed claims of FFP); §§ 430.40 through 430.42 of this chapter (Deferral of claims for FFP and Disallowance of claims for FFP); § 430.48 of this chapter (Repayment of Federal funds by installments); §§ 433.50 through 433.74 of this chapter (sources of non-Federal share and Health Care-Related Taxes and Provider Related Donations); and § 447.207 of this chapter (Retention of Payments) apply to State's CHIP programs in the same manner as they apply to State's Medicaid programs. (b) HHS Regulations in 45 CFR subtitle A: 2 CFR parts 200 and 300—Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Part 16—Procedures of the Departmental Appeals Board. Part 80—Nondiscrimination Under Programs Receiving Federal Assistance Through the Department of Health and Human Services: Effectuation of title VI of the Civil Rights Act of 1964. Part 81—Practice and Procedure for Hearings Under 45 CFR part 80. Part 84—Nondiscrimination on the Basis of Handicap in Programs and activities Receiving or Benefiting From Federal Financial Assistance. Part 95—General Administration—grant programs (public assistance and medical assistance). [66 FR 2670, Jan. 11, 2001, as amended at 72 FR 29836, May 29, 2007; 75 FR 73976, Nov. 30, 2010; 77 FR 31513, May 29, 2012; 81 FR 3012, Jan. 20, 2016; 82 FR 31187, July 5, 2017; 89 FR 80070, Oct. 2, 2024] § 457.630 Grants procedures. (a) General provisions. (1) For fiscal year 1998, a State must submit a budget request in an appropriate format for the 4 quarters of the fiscal year. CMS bases the grant awards for the 4 quarters of fiscal year 1998 based on the State's budget requests for those quarters. (2) For fiscal years after 1998, a State must submit a budget request in an appropriate format for the first 3 quarters of the fiscal year. CMS bases the grant awards for the first 3 quarters of the fiscal year on the State's budget requests for those quarters. (3) For fiscal years after 1998, a State must also submit a budget request for the fourth quarter of the fiscal year. The amount of this quarter's grant award is based on the difference between a State's final allotment for the fiscal year, and the total of the grants for the first 3 quarters that were already issued in order to ensure that the total of all grant awards for the fiscal year are equal to the State's final allotment for that fiscal year. (4) The amount of the quarterly grant is determined on the basis of information submitted by the State (in quarterly estimate and quarterly expenditure reports) and other pertinent information. This information must be submitted by the State through the Medicaid Budget and Expenditure System (MBES) for the Medicaid program, and through the Child Health Budget and Expenditure System (CBES) for the title XXI program. (b) Quarterly estimates. (c) Expenditure reports. (2) This report is the State's accounting of actual recorded expenditures. This disposition of Federal funds may not be reported on the basis of estimates. (d) Additional required information. (1) Name and address of the State Agency/organization administering the program; (2) The employer identification number (EIN); and (3) A State official contact name and telephone number. (e) Grant award Computation by CMS. (2) Content of award. (i) Penalty reductions imposed by law. (ii) Deferrals or disallowances. (iii) Interest assessments. (iv) Mandated adjustments such as those required by Section 1914 of the Act. (3) Effect of award. (4) Draw procedure. (f) General administrative requirements. (1) Cost sharing or matching, 2 CFR 200.306,; and (2) Financial reporting, 2 CFR 200.328. [65 FR 33622, May 24, 2000, as amended at 75 FR 48852, Aug. 11, 2010; 81 FR 3012, Jan. 20, 2016; 89 FR 80070, Oct. 2, 2024] Subpart G—Strategic Planning, Reporting, and Evaluation Source: 66 FR 2683, Jan. 11, 2001, unless otherwise noted. § 457.700 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2101(a) of the Act, which sets forth that the purpose of title XXI is to provide funds to States to provide child health assistance to uninsured, low-income children in an effective and efficient manner that is coordinated with other sources of health benefits coverage; (2) Sections 2107(a), (b) and (d) of the Act, which set forth requirements for strategic planning, reports, and program budgets; (3) Section 2108 of the Act, which sets forth provisions regarding annual reports and evaluation; and (4) Section 1139A and 1139B of the Act, which set forth the requirements for child and adult health quality measures and reporting. (b) Scope. (c) Applicability. [66 FR 2683, Jan. 11, 2001, as amended at 85 FR 25635, May 1, 2020; 88 FR 60315, Aug. 31, 2023; 89 FR 8982, Feb. 8, 2024] § 457.710 State plan requirements: Strategic objectives and performance goals. (a) Plan description. (1) The strategic objectives as described in paragraph (b) of this section; (2) The performance goals as described in paragraph (c) of this section; and (3) The performance measurements, as described in paragraph (d) of this section, that the State has established for providing child health assistance to targeted low-income children under the plan and otherwise for maximizing health benefits coverage for other low-income children and children generally in the State. (b) Strategic objectives. (c) Performance goals. (d) Performance measurements. (1) Measured through objective, independently verifiable means; and (2) Compared against performance goals. (e) Core elements. § 457.720 State plan requirement: State assurance regarding data collection, records, and reports. A State plan must include an assurance that the State collects data, maintains records, and furnishes reports to the Secretary, at the times and in the standardized format the Secretary may require to enable the Secretary to monitor State program administration and compliance and to evaluate and compare the effectiveness of State plans under Title XXI of the Act. This includes collection of data and reporting as required under § 431.970 of this chapter. [71 FR 51084, Aug. 28, 2006] § 457.730 Beneficiary access to and exchange of data. (a) Application Programming Interface to support CHIP beneficiaries. (b) Accessible content. (1) Data concerning adjudicated claims, including claims data for payment decisions that may be appealed, were appealed, or are in the process of appeal, and provider remittances and beneficiary cost-sharing pertaining to such claims, no later than one (1) business day after a claim is processed; (2) Encounter data no later than 1 business day after receiving the data from providers, other than MCOs, PIHPs, or PAHPs, compensated on the basis of capitation payments; (3) All data classes and data elements included in a content standard in 45 CFR 170.213 that are maintained by the State no later than 1 business day after the State receives the data; and (4) Information, about covered outpatient drugs and updates to such information, including, where applicable, preferred drug list information, no later than one (1) business day after the effective date of the information or updates to such information. (5) Beginning January 1, 2027, the information in paragraph (b)(5)(i) of this section about prior authorizations for items and services (excluding drugs as defined in paragraph (b)(6) of this section), according to the timelines in paragraph (b)(5)(ii) of this section. (i) The prior authorization request and decision, including all of the following, as applicable: (A) The prior authorization status. (B) The date the prior authorization was approved or denied. (C) The date or circumstance under which the prior authorization ends. (D) The items and services approved. (E) If denied, a specific reason why the request was denied. (F) Related structured administrative and clinical documentation submitted by a provider. (ii) The information in paragraph (b)(5)(i) of this section must— (A) Be accessible no later than 1 business day after the State receives a prior authorization request; (B) Be updated no later than 1 business day after any status change; and (C) Continue to be accessible for the duration that the authorization is active and at least 1 year after the prior authorization's last status change. (6) Drugs are defined for the purposes of paragraph (b)(5) of this section as any and all drugs covered by the State. (c) Technical requirements. (1) Must implement and maintain API technology conformant with 45 CFR 170.215(a)(1), (b)(1)(i), (c)(1), and (e)(1); (2) Must conduct routine testing and monitoring, and update as appropriate, to ensure the API functions properly, including assessments to verify that the API technology is fully and successfully implementing privacy and security features such as, but not limited to, those required to comply with HIPAA privacy and security requirements in 45 CFR parts 160 and 164, 42 CFR parts 2 and 3, and other applicable law protecting the privacy and security of individually identifiable data; (3) Must comply with the content and vocabulary standard requirements in paragraphs (c)(3)(i) and (ii) of this section, as applicable to the data type or data element, unless alternate standards are required by other applicable law: (i) Content and vocabulary standards at 45 CFR 170.213 where such standards are applicable to the data type or element, as appropriate; and (ii) Content and vocabulary standards at 45 CFR part 162 and § 423.160 of this chapter where required by law, or where such standards are applicable to the data type or element, as appropriate. (4) May use an updated version of any standard or all standards required under paragraphs (c)(1) or (3) of this section, where: (i) Use of the updated version of the standard is required by other applicable law, or (ii) Use of the updated version of the standard is not prohibited under other applicable law, provided that: (A) For content and vocabulary standards other than those at 45 CFR 170.213, the Secretary has not prohibited use of the updated version of a standard for purposes of this section or 45 CFR part 170; (B) For standards at 45 CFR 170.213 and 170.215, the National Coordinator has approved the updated version for use in the ONC Health IT Certification Program; and (C) Using the updated version of the standard, implementation guide, or specification does not disrupt an end user's ability to access the data specified in paragraph (b) of this section or §§ 457.731, 457.732, and 457.760 through the required APIs. (d) Documentation requirements for APIs. (1) API syntax, function names, required and optional parameters supported and their data types, return variables and their types/structures, exceptions and exception handling methods and their returns; (2) The software components and configurations that an application must use in order to successfully interact with the API and process its response(s); and (3) All applicable technical requirements and attributes necessary for an application to be registered with any authorization server(s) deployed in conjunction with the API. (e) Denial or discontinuation of access to the API. (1) Reasonably determines, consistent with its security risk analysis under 45 CFR part 164 subpart C, that allowing an application to connect or remain connected to the API would present an unacceptable level of risk to the security of protected health information on the State's systems; and (2) Makes this determination using objective, verifiable criteria that are applied fairly and consistently across all apps and developers through which parties seek to access electronic health information, as defined in 45 CFR 171.102, including but not limited to criteria that rely on automated monitoring and risk mitigation tools. (f) Reporting on Patient Access API usage. (1) The total number of unique beneficiaries whose data are transferred via the Patient Access API to a health app designated by the beneficiary; and (2) The total number of unique beneficiaries whose data are transferred more than once via the Patient Access API to a health app designated by the beneficiary. (g) Beneficiary resources regarding privacy and security. (1) General information on steps the individual may consider taking to help protect the privacy and security of their health information, including factors to consider in selecting an application including secondary uses of data, and the importance of understanding the security and privacy practices of any application to which they will entrust their health information; and (2) An overview of which types of organizations or individuals are and are not likely to be HIPAA covered entities, the oversight responsibilities of OCR and FTC, and how to submit a complaint to— (i) The HHS Office for Civil Rights (OCR); and (ii) The Federal Trade Commission (FTC). (h) Applicability. (1) With a date of service on or after January 1, 2016; and (2) That are maintained by the State. [85 FR 25636, May 1, 2020, as amended at 89 FR 8982, Feb. 8, 2024; 89 FR 85071, Oct. 25, 2024] § 457.731 Access to and exchange of health data for providers and payers. (a) Application programming interface to support data exchange from payers to providers—Provider Access API. (1) API requirements. (i) Section 457.730(c)(2) through (4), (d), and (e). (ii) The standards in 45 CFR 170.215(a)(1), (b)(1)(i), (c)(1), and (d)(1). (2) Provider access. (i) The State authenticates the identity of the provider that requests access and attributes the beneficiary to the provider under the attribution process described in paragraph (a)(3) of this section. (ii) The beneficiary does not opt out as described in paragraph (a)(4) of this section. (iii) Disclosure of the data is not prohibited by other applicable law. (3) Attribution. (4) Opt out and patient educational resources. (ii) Provide information to beneficiaries in plain language about the benefits of API data exchange with their providers, their opt out rights, and instructions both for opting out of data exchange and for subsequently opting in, as follows: (A) Before the first date on which the State makes beneficiary information available through the Provider Access API. (B) No later than 1 week after enrollment. (C) At least annually. (D) In an easily accessible location on its public website. (5) Provider resources. (b) Application programming interface to support data exchange between payers—Payer-to-Payer API. (1) API requirements. (i) Section 457.730(c)(2) through (4), (d), and (e). (ii) The standards in 45 CFR 170.215(a)(1), (b)(1)(i), and (d)(1). (2) Opt in. (i) The opt in process must be offered as follows: (A) To current beneficiaries, no later than the compliance date. (B) To new beneficiaries, no later than 1 week after enrollment. (ii) If a beneficiary has coverage through any CHIP managed care entities within the same State while enrolled in CHIP, the State must share their opt in permission with those managed care entities to allow the Payer-to-Payer API data exchange described in this section. (iii) If a beneficiary does not respond or additional information is necessary, the State must make reasonable efforts to engage with the beneficiary to collect this information. (3) Identify previous and concurrent payers. (i) For current beneficiaries, no later than the compliance date. (ii) For new beneficiaries, no later than 1 week after enrollment. (iii) If a beneficiary does not respond or additional information is necessary, the State must make reasonable efforts to engage with the beneficiary to collect this information. (4) Exchange request requirements. (i) The State must request the data specified in paragraph (b)(4)(ii) of this section through the beneficiary's previous payers' API, if all the following conditions are met: (A) The beneficiary has opted in, as described in paragraph (b)(2) of this section, except for data exchanges between a State CHIP agency and its contracted managed care entities, which do not require a beneficiary to opt in. (B) The exchange is not prohibited by other applicable law. (ii) The data to be requested are all of the following with a date of service within 5 years before the request: (A) Data specified in § 457.730(b), excluding the following: ( 1 ( 2 (B) Unstructured administrative and clinical documentation submitted by a provider related to prior authorizations. (iii) The State must include an attestation with this request affirming that the beneficiary is enrolled with the State and has opted into the data exchange. (iv) The State must complete this request as follows: (A) No later than 1 week after the payer has sufficient identifying information about previous payers and the beneficiary has opted in. (B) At a beneficiary's request, within 1 week of the request. (v) The State must receive, through the API required in paragraph (b)(1) of this section, and incorporate into its records about the beneficiary, any data made available by other payers in response to the request. (5) Exchange response requirements. (i) The payer that requests access has its identity authenticated and includes an attestation with the request that the patient is enrolled with the payer and has opted into the data exchange. (ii) Disclosure of the data is not prohibited by other applicable law. (6) Concurrent coverage data exchange requirements. (i) Request the beneficiary's data from all known concurrent payers as described in paragraph (b)(4) of this section, and at least quarterly thereafter while the beneficiary is enrolled with both payers. (ii) Respond as described in paragraph (b)(5) of this section within 1 business day of a request from any concurrent payers. If agreed upon with the requesting payer, the State may exclude any data that were previously sent to or originally received from the concurrent payer. (7) Patient educational resources. (i) When requesting a beneficiary's permission for Payer-to-Payer API data exchange, as described in paragraph (b)(2) of this section. (ii) At least annually, in appropriate mechanisms through which it ordinarily communicates with current beneficiaries. (iii) In an easily accessible location on its public website. (c) Extensions and exemptions Extension. (A) A narrative justification describing the specific reasons why the State cannot satisfy the requirement(s) by the compliance date and why those reasons result from circumstances that are unique to the agency operating the CHIP fee-for service program. (B) A report on completed and ongoing State activities that evidence a good faith effort towards compliance. (C) A comprehensive plan to meet the requirements no later than 1 year after the compliance date. (ii) CMS grants the State's request if it determines, based on the information provided, that— (A) The request adequately establishes a need to delay implementation; and (B) The State has a comprehensive plan to meet the requirements no later than 1 year after the compliance date. (2) Exemption. (A) Paragraph (a) of this section. (B) Paragraphs (b)(1) and (3) through (7) of this section. (ii) The State's exemption request must: (A) Be submitted in writing as part of a State's annual APD for MMIS operations expenditures before the compliance date for the requirements to which the State is seeking an exemption. (B) Include both of the following: ( 1 ( 2 (iii) CMS grants the exemption if the State establishes to CMS's satisfaction that the State— (A) Meets the threshold for the exemption; and (B) Has established an alternative plan to ensure that enrolled providers will have efficient electronic access to the same information through other means while the exemption is in effect. (iv) The State's exemption expires if either— (A) Based on the 3 previous years of available, finalized CHIP CARTS managed care and fee-for-service enrollment data, the State's managed care enrollment for 2 of the previous 3 years is below 90 percent; or (B)( 1 ( 2 (v) If a State's exemption expires under paragraph (c)(2)(iv) of this section, the State is required to do both of the following: (A) Submit written notification to CMS that the State no longer qualifies for the exemption within 90 days of the finalization of annual CARTS managed care enrollment data that demonstrates that there has been the requisite shift from managed care enrollment to fee-for-service enrollment resulting in the State's managed care enrollment falling below the 90 percent threshold. (B) Obtain CMS approval of a timeline for compliance with the requirements in paragraph (a) or (b) (or paragraphs (a) and (b)) of this section within 2 years of the expiration of the exemption. [89 FR 8983, Feb. 8, 2024] § 457.732 Prior authorization requirements. (a) Communicating a reason for denial. (b) Prior Authorization Application Programming Interface (API). (1) Is populated with the State's list of covered items and services (excluding drugs as defined in § 457.730(b)(6)) that require prior authorization; (2) Can identify all documentation required by the State for approval of any items or services that require prior authorization; (3) Supports a HIPAA-compliant prior authorization request and response, as described in 45 CFR part 162; and (4) Communicates the following information about prior authorization requests: (i) Whether the State— (A) Approves the prior authorization request (and the date or circumstance under which the authorization ends); (B) Denies the prior authorization request; or (C) Requests more information. (ii) If the State denies the prior authorization request, it must include a specific reason for the denial. (c) Publicly reporting prior authorization metrics. (1) A list of all items and services that require prior authorization. (2) The percentage of standard prior authorization requests that were approved, aggregated for all items and services. (3) The percentage of standard prior authorization requests that were denied, aggregated for all items and services. (4) The percentage of standard prior authorization requests that were approved after appeal, aggregated for all items and services. (5) The percentage of prior authorization requests for which the timeframe for review was extended, and the request was approved, aggregated for all items and services. (6) The percentage of expedited prior authorization requests that were approved, aggregated for all items and services. (7) The percentage of expedited prior authorization requests that were denied, aggregated for all items and services. (8) The average and median time that elapsed between the submission of a request and a determination by the State, for standard prior authorizations, aggregated for all items and services. (9) The average and median time that elapsed between the submission of a request and a decision by the State for expedited prior authorizations, aggregated for all items and services. (d) Extensions and exemptions Extension. (A) A narrative justification describing the specific reasons why the State cannot satisfy the requirement(s) by the compliance date and why those reasons result from circumstances that are unique to the agency operating the CHIP fee-for service program; (B) A report on completed and ongoing State activities that evidence a good faith effort toward compliance. (C) A comprehensive plan to meet the requirements no later than 1 year after the compliance date. (ii) CMS grants the State's request if it determines, based on the information provided, that— (A) The request adequately establishes a need to delay implementation; and (B) The State has a comprehensive plan to meet the requirements no later than 1 year after the compliance date. (2) Exemption. (ii) The State's exemption request must: (A) Be submitted in writing as part of a State's annual APD for MMIS operations expenditures before the compliance date in paragraph (b) of this section. (B) Include both of the following: ( 1 ( 2 (iii) CMS grants the exemption if the State establishes to CMS's satisfaction that the State— (A) Meets the threshold for the exemption; and (B) Has established an alternative plan to ensure that its enrolled providers will have efficient electronic access to the same information through other means while the exemption is in effect. (iv) The State's exemption expires if either— (A) Based on the 3 previous years of available, finalized CHIP CARTS managed care and fee-for-service enrollment data, the State's managed care enrollment for 2 of the previous 3 years is below 90 percent; or (B)( 1 ( 2 (v) If a State's exemption expires under paragraph (d)(2)(iv) of this section, the State is required to do both of the following: (A) Submit written notification to CMS that the State no longer qualifies for the exemption within 90 days of the finalization of annual CARTS managed care enrollment data that demonstrates that there has been the requisite shift from managed care enrollment to fee-for-service enrollment resulting in the State's managed care enrollment falling below the 90 percent threshold. (B) Obtain CMS approval of a timeline for compliance with the requirements in paragraph (b) of this section within 2 years of the expiration of the exemption. [89 FR 8984, Feb. 4, 2024] § 457.740 State expenditures and statistical reports. (a) Required quarterly reports. (1) Program expenditures; (2) The number of children enrolled in the title XIX Medicaid program, the separate child health program, and the Medicaid expansion program, as applicable, as of the last day of each quarter of the Federal fiscal year; and (3) The number of children under 19 years of age who are enrolled in the title XIX Medicaid program, the separate child health program, and in the Medicaid expansion program, as appropriate, by the following categories: (i) Age (under 1 year of age, 1 through 5 years of age, 6 through 12 years of age, and 13 through 18 years of age). (ii) Gender, race, and ethnicity. (iii) Service delivery system (managed care, fee-for-service, and primary care case management). (iv) Household income as a percentage of the Federal poverty level as described in paragraph (b) of this section. (b) Reportable household income categories. (i) At or below 150 percent of FPL. (ii) Over 150 percent of FPL. (2) A State that imposes a different level or percentage of cost sharing at different poverty levels must report by poverty level categories that match the poverty level categories used for purposes of cost sharing. (c) Required unduplicated counts. § 457.750 Annual report. (a) Report required for each Federal fiscal year. (b) Contents of annual report. (1) Describe the State's progress in reducing the number of uncovered, low-income children and; in meeting other strategic objectives and performance goals identified in the State plan; and provide information related to a core set of national performance goals and measures as developed by the Secretary; (2) Report on the effectiveness of the State's policies for discouraging the substitution of public coverage for private coverage; (3) Identify successes and barriers in State plan design and implementation, and the approaches the State is considering to overcome these barriers; (4) Describe the State's progress in addressing any specific issues (such as outreach) that the State plan proposed to periodically monitor and assess; (5) Provide an updated budget for a 3-year period that describes those elements required in § 457.140, including any changes in the sources of the non-Federal share of State plan expenditures; (6) Identify the total State expenditures for family coverage and total number of children and adults, respectively, covered by family coverage during the preceding Federal fiscal year; (7) Describe the State's current income standards and methodologies for its Medicaid expansion program, separate child health program, and title XIX Medicaid program, as appropriate. (c) Methodology for estimate of number of uninsured, low-income children. (i) A State may base the estimate on data from— (A) The March supplement to the Current Population Survey (CPS); (B) A State-specific survey; (C) A statistically adjusted CPS; or (D) Another appropriate source. (ii) If the State does not base the estimate on data from the March supplement to the CPS, the State must submit a description of the methodology used to develop the initial baseline estimate and the rationale for its use. (2) The State must provide an annual estimate of changes in the number of uninsured in the State using— (i) The same methodology used in establishing the initial baseline; or (ii) Another methodology based on new information that enables the State to establish a new baseline. (3) If a new methodology is used, the State must also provide annual estimates based on either the March supplement to the CPS or the methodology used to develop the initial baseline. [66 FR 2683, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] § 457.760 Access to published provider directory information. (a) The State must implement and maintain a publicly accessible, standards-based Application Programming Interface (API) that is conformant with the technical requirements at § 457.730(c), excluding the security protocols related to user authentication and authorization and any other protocols that restrict the availability of this information to particular persons or organizations, the documentation requirements at § 457.730(d), and is accessible via a public-facing digital endpoint on the State's website. (b) The API must provide a complete and accurate directory of— (1) The State's provider directory information including provider names, addresses, phone numbers, and specialties, updated no later than 30 calendar days after the State receives provider directory information or updates to provider directory information. (2) [Reserved] (c) This section is applicable beginning January 1, 2021. [85 FR 25637, May 1, 2020] § 457.770 Reporting on Health Care Quality Measures. (a) Reporting the Child Core Set. (b) Reporting the Adult Core Set. (c) Reporting of Medicaid and CHIP beneficiaries. [88 FR 60315, Aug. 31, 2023] Subpart H—Substitution of Coverage Source: 66 FR 2684, Jan. 11, 2001, unless otherwise noted. § 457.800 Basis, scope, and applicability. (a) Statutory basis. (b) Scope. (c) Applicability. § 457.805 State plan requirement: Procedures to address substitution under group health plans. (a) State plan requirements. (b) Limitations. [78 FR 42313, July 15, 2013, as amended at 81 FR 86466, Nov. 30, 2016; 89 FR 22877, Apr. 2, 2024] § 457.810 Premium assistance programs: Required protections against substitution. A State that operates a premium assistance program, as defined at § 457.10, must provide the protections against substitution of CHIP coverage for coverage under group health plans specified in this section. The State must describe these protections in the State plan; and report on results of monitoring of substitution in its annual reports. (a) Prohibition of waiting periods. (b) Employer contribution. (c) Cost effectiveness. (1) The State's cost for coverage for children under premium assistance programs must not be greater than the cost of other CHIP coverage for these children; and (2) The State may base its demonstration of cost effectiveness on an assessment of the cost of coverage for children under premium assistance programs to the cost of other CHIP coverage for these children, done on a case-by-case basis, or on the cost of premium assisted coverage in the aggregate. (d) State evaluation. [66 FR 2684, Jan. 11, 2001, as amended at 78 FR 42313, July 15, 2013; 89 FR 22877, Apr. 2, 2024] Subpart I—Program Integrity Source: 66 FR 2685, Jan. 11, 2001, unless otherwise noted. § 457.900 Basis, scope and applicability. (a) Statutory basis. (1) Section 2101(a) of the Act, which provides that the purpose of title XXI is to provide funds to States to enable them to initiate and expand the provision of child health assistance to uninsured, low-income children in an effective and efficient manner; and (2) Section 2107(e) of the Act, which provides that certain title XIX and title XI provisions, including the following, apply to States under title XXI in the same manner as they apply to a State under title XIX: (i) Section 1902(a)(4)(C) of the Act, relating to conflict of interest standards. (ii) Paragraphs (2), (16), and (17), of section 1903(i) of the Act, relating to limitations on payment. (iii) Section 1903(w) of the Act, relating to limitations on provider taxes and donations. (iv) Section 1124 of the Act, relating to disclosure of ownership and related information. (v) Section 1126 of the Act, relating to disclosure of information about certain convicted individuals. (vi) Section 1128 of the Act, relating to exclusions. (vii) Section 1128A of the Act, relating to civil monetary penalties. (viii) Section 1128B(d) of the Act, relating to criminal penalties for certain additional charges. (ix) Section 1132 of the Act, relating to periods within which claims must be filed. (x) Sections 1902(a)(77) and 1902(kk) of the Act relating to provider and supplier screening, oversight, and reporting requirements. (b) Scope. (c) Applicability. [66 FR 2685, Jan. 11, 2001, as amended at 76 FR 5970, Feb. 2, 2011] § 457.910 State program administration. The State's child health program must include— (a) Methods of administration that the Secretary finds necessary for the proper and efficient operation of the separate child health program; and (b) Safeguards necessary to ensure that— (1) Eligibility will be determined appropriately in accordance with subpart C of this part; and (2) Services will be provided in a manner consistent with administrative simplification and with the provisions of subpart D of this part. § 457.915 Fraud detection and investigation. (a) State program requirements. (1) Methods and criteria for identifying suspected fraud and abuse cases. (2) Methods for investigating fraud and abuse cases that— (i) Do not infringe on legal rights of persons involved; and (ii) Afford due process of law. (b) State program integrity unit. (c) Program coordination. (1) U.S. Department of Health and Human Services Office of Inspector General (OIG); (2) U.S. Attorney's Office, Department of Justice (DOJ); (3) Federal Bureau of Investigation (FBI); and (4) State Attorney General's office. § 457.925 Preliminary investigation. If the State agency receives a complaint of fraud or abuse from any source or identifies questionable practices, the State agency must conduct a preliminary investigation or take otherwise appropriate action within a reasonable period of time to determine whether there is sufficient basis to warrant a full investigation. § 457.930 Full investigation, resolution, and reporting requirements. The State must establish and implement effective procedures for investigating and resolving suspected and apparent instances of fraud and abuse. Once the State determines that a full investigation is warranted, the State must implement procedures including, but not limited to the following: (a) Cooperate with and refer potential fraud and abuse cases to the State program integrity unit, if such a unit exists. (b) Conduct a full investigation. (c) Refer the fraud and abuse case to appropriate law enforcement officials. § 457.935 Sanctions and related penalties. (a) A State may not make payments for any item or service furnished, ordered, or prescribed under a separate child health program to any provider who has been excluded from participating in the Medicare and Medicaid programs. (b) The following provisions and their corresponding regulations apply to a State under title XXI, in the same manner as these provisions and regulations apply to a State under title XIX: (1) Part 455, subpart B of this chapter. (2) Section 1124 of the Act pertaining to disclosure of ownership and related information. (3) Section 1126 of the Act pertaining to disclosure by institutions, organizations, and agencies of owners and certain other individuals who have been convicted of certain offenses. (4) Section 1128 of the Act pertaining to exclusions. (5) Section 1128A of the Act pertaining to civil monetary penalties. (6) Section 1128B of the Act pertaining to criminal penalties for acts involving Federal health care programs. (7) Section 1128E of the Act pertaining to the reporting of final adverse actions on liability findings made against health care providers, suppliers, and practitioners under the health care fraud and abuse data collection program. § 457.940 Procurement standards. (a) A State must submit to CMS a written assurance that Title XXI services will be provided in an effective and efficient manner. The State must submit the assurance— (1) With the initial State plan; or (2) For States with approved plans, with the first request to amend the approved plan. (b) A State must provide for free and open competition, to the maximum extent practical, in the bidding of all procurement contracts for coverage or other services in accordance with the procurement requirements of 2 CFR parts 200 and 300, as applicable. (c) All contracts under this part must include provisions that define a sound and complete procurement contract, as required by 2 CFR parts 200 and 300, as applicable. [81 FR 27897, May 6, 2016, as amended at 89 FR 80070, Oct. 2, 2024] § 457.945 Certification for contracts and proposals. Entities that contract with the State under a separate child health program must certify the accuracy, completeness, and truthfulness of information in contracts and proposals, including information on subcontractors, and other related documents, as specified by the State. § 457.950 Contract and payment requirements including certification of payment-related information. (a) MCOs, PAHPs, PIHPs, PCCMs, and PCCM entities. (b) Fee-for-service entities. (1) Establish procedures to ensure that the entity certifies and attests that information on claim forms is truthful, accurate, and complete; (2) Ensure that fee-for-service entities understand that payment and satisfaction of the claims will be from Federal and State funds, and that any false claims may be prosecuted under applicable Federal or State laws; and (3) Require, as a condition of participation, that fee-for-service entities provide the State, CMS and/or the HHS Office of the Inspector General with access to enrollee health claims data, claims payment data and related records. [66 FR 2685, Jan. 11, 2001, as amended at 81 FR 27897, May 6, 2016] § 457.960 Reporting changes in eligibility and redetermining eligibility. If the State requires reporting of changes in circumstances that may affect the enrollee's eligibility for child health assistance, the State must— (a) Establish procedures to ensure that enrollees make timely and accurate reports of any such change; and (b) Promptly redetermine eligibility when the State has information about these changes. (c) This section sunsets on October 1, 2034. CMS will follow applicable rulemaking procedures to ensure that policy governing changes in circumstances and redeterminations of CHIP eligibility are implemented and effective on October 1, 2034, replacing the policy scheduled to sunset on that date for the period until October 1, 2034. [91 FR 33482, June 3, 2026] § 457.965 Documentation. (a) Basis and purpose. (b) Content of records. (1) Individual records on each applicant and enrollee that contain all of the following: (i) All information provided on the initial application submitted through any modality described in § 435.907(a) of this chapter as referenced in § 457.330, by, or on behalf of, the applicant or enrollee, including the signature on and date of application. (ii) The electronic account and any information or other documentation received from another insurance affordability program in accordance with § 457.348(b) and (c). (iii) The date of, basis for, and all documents or other evidence to support any determination, denial, or other adverse action, including decisions made at application, renewal, and a result of a change in circumstance, taken with respect to the applicant or enrollee, including all information provided by the applicant or enrollee, and all information obtained electronically or otherwise by the State from third-party sources. (iv) The provision of, and payment for, services, items and other child health assistance or pregnancy-related assistance, including the service or item provided, relevant diagnoses, the date that the item or service was provided, the practitioner or provider rendering, providing or prescribing the service or item, including their National Provider Identifier, and the full amount paid or reimbursed for the service or item, and any third-party liabilities. (v) Any changes in circumstances reported by the individual and any actions taken by the State in response to such reports. (vi) All renewal forms returned by, or on behalf of, a beneficiary, to the State in accordance with § 457.343, regardless of the modality through which such forms are submitted, including the signature on the form and date received. (vii) All notices provided to the applicant or enrollee in accordance with § 457.340(e) and § 457.1180. (viii) All records pertaining to any State reviews requested by, or on behalf of, the applicant or enrollee, including each request submitted and the date of such request, the complete record of the review decision, as described in subpart K of this part, and the final administrative action taken by the agency following the review decision and date of such action. (ix) The disposition of income and eligibility verification information received under § 457.380, including evidence that no information was returned from an electronic data source. (2) Statistical, fiscal, and other records necessary for reporting and accountability as required by the Secretary. (c) Retention of records. (d) Accessibility and availability of records. (1) Maintain the records described in paragraph (b) of this section in an electronic format; and (2) To the extent permitted under Federal law, make the records available to the Secretary, Federal and State auditors and other parties who request, and are authorized to review, such records within 30 calendar days of the request (or longer period specified in the request), except when there is an administrative or other emergency beyond the agency's control. (e) Release and safeguarding information. [89 FR 22877, Apr. 2, 2024] § 457.980 Verification of enrollment and provider services received. The State must establish and maintain systems to identify, report, and verify the accuracy of claims for those enrolled children who meet requirements of section 2105(a) of the Act, where enhanced Federal medical assistance percentage computations apply. [66 FR 2685, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] § 457.985 Integrity of professional advice to enrollees. The State must ensure through its contracts for coverage and services that its contractors comply with— (a) Section 422.206(a) of this chapter, which prohibits interference with health care professionals' advice to enrollees and requires that professionals provide information about treatment in an appropriate manner; and (b) Sections 422.208 and 422.210 of this chapter, which place limitations on physician incentive plans, and information disclosure requirements related to those physician incentive plans, respectively. § 457.990 Provider and supplier screening, oversight, and reporting requirements. The following provisions and their corresponding regulations apply to a State under title XXI of the Act, in the same manner as these provisions and regulations apply to a State under title XIX of the Act: (a) Section 455.107. (b) Part 455, subpart E, of this chapter. (c) Sections 1902(a)(77) and 1902(kk) of the Act pertaining to provider and supplier screening, oversight, and reporting requirements. [76 FR 5970, Feb. 2, 2011, as amended at 84 FR 47857, Sept. 10, 2019] Subpart J—Allowable Waivers: General Provisions Source: 66 FR 2686, Jan. 11, 2001, unless otherwise noted. § 457.1000 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2105(c)(2)(B) of the Act, which sets forth the requirements to permit a State to exceed the 10 percent cost limit on expenditures other than benefit expenditures; and (2) Section 2105(c)(3) of the Act, which permits the purchase of family coverage. (b) Scope. (c) Applicability. [66 FR 2686, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] § 457.1003 CMS review of waiver requests. CMS will review the waiver requests under this subpart using the same time frames used for State plan amendments, as specified in § 457.160. § 457.1005 Cost-effective coverage through a community-based health delivery system. (a) Availability of waiver. (b) Requirements for obtaining a waiver. (1) The coverage meets all of the requirements of this part, including subpart D and subpart E. (2) The cost of such coverage, on an average per child basis, does not exceed the cost of coverage under the State plan. (c) Three-year approval period. (d) Application of cost savings. (1) Other child health assistance, health services initiatives, or outreach; or (2) Any reasonable costs necessary to administer the State's program. § 457.1010 Purchase of family coverage. A State may purchase family coverage that includes coverage for targeted low-income children if the State establishes that— (a) Purchase of family coverage is cost-effective under the standards described in § 457.1015; (b) The State does not purchase the coverage if it would otherwise substitute for health insurance coverage that would be provided to targeted, low-income children but for the purchase of family coverage; and (c) The coverage for the family otherwise meets the requirements of this part. § 457.1015 Cost-effectiveness. (a) Definition. (b) Cost comparisons. (c) Individual or aggregate basis. (2) The State must assess cost-effectiveness in its initial request for a waiver and then annually. (3) For any State that chooses the aggregate cost method, if an annual assessment of the cost-effectiveness of family coverage in the aggregate reveals that it is not cost-effective, the State must assess cost-effectiveness on a case-by-case basis. (d) Reports on family coverage. Subpart K—State Plan Requirements: Applicant and Enrollee Protections Source: 66 FR 2687, Jan. 11, 2001, unless otherwise noted. § 457.1100 Basis, scope and applicability. (a) Statutory basis. (1) Section 2101(a) of the Act, which states that the purpose of title XXI of the Act is to provide funds to States to enable them to initiate and expand the provision of child health assistance to uninsured, low-income children in an effective and efficient manner; (2) Section 2102(a)(7)(B) of the Act, which requires that the State plan include a description of the methods used to assure access to covered services, including emergency services; (3) Section 2102(b)(2) of the Act, which requires that the State plan include a description of methods of establishing and continuing eligibility and enrollment; and (4) Section 2103 of the Act, which outlines coverage requirements for a State that provides child health assistance through a separate child health program. (b) Scope. (c) Applicability. § 457.1110 Privacy protections. The State must ensure that, for individual medical records and any other health and enrollment information maintained with respect to enrollees, that identifies particular enrollees (in any form), the State establishes and implements procedures to— (a) Abide by all applicable Federal and State laws regarding confidentiality and disclosure, including those laws addressing the confidentiality of information about minors and the privacy of minors, and privacy of individually identifiable health information; (b) Comply with subpart F of part 431 of this chapter; (c) Maintain the records and information in a timely and accurate manner; (d) Specify and make available to any enrollee requesting it— (1) The purposes for which information is maintained or used; and (2) To whom and for what purposes the information will be disclosed outside the State; (e) Except as provided by Federal and State law, ensure that each enrollee may request and receive a copy of records and information pertaining to the enrollee in a timely manner and that an enrollee may request that such records or information be supplemented or corrected. § 457.1120 State plan requirement: Description of review process. (a) The State must have one of the following review processes: (1) Program specific review. (2) Statewide Standard Review. (b) The State plan must include a description of the State's review process. [66 FR 33824, June 25, 2001] § 457.1130 Program specific review process: Matters subject to review. (a) Eligibility or enrollment matter. (1) Denial of eligibility; (2) Failure to make a timely determination of eligibility; and (3) Suspension or termination of enrollment, including disenrollment for failure to pay cost sharing. (b) Health services matter. (1) Delay, denial, reduction, suspension, or termination of health services, in whole or in part, including a determination about the type or level of services; and (2) Failure to approve, furnish, or provide payment for health services in a timely manner. (c) Exception. § 457.1140 Program specific review process: Core elements of review. In adopting the procedures for review of matters described in § 457.1130, a State must ensure that— (a) Reviews are conducted by an impartial person or entity in accordance with § 457.1150; (b) Review decisions are timely in accordance with § 457.1160; (c) Review decisions are written; and (d) Applicants and enrollees have an opportunity to— (1) Represent themselves or have representatives of their choosing in the review process; (2) Timely review their files and other applicable information relevant to the review of the decision; (3) Fully participate in the review process, whether the review is conducted in person or in writing, including by presenting supplemental information during the review process; and (4) Receive continued enrollment and benefits in accordance with § 457.1170. [66 FR 2687, Jan. 11, 2001, as amended at 89 FR 22877, Apr. 2, 2024] § 457.1150 Program specific review process: Impartial review. (a) Eligibility or enrollment matter. (b) Health services matter. § 457.1160 Program specific review process: Time frames. (a) Eligibility or enrollment matter. (b) Health services matter. (1) Standard timeframe. (2) Expedited timeframe. § 457.1170 Program specific review process: Continuation of enrollment. § 457.1170 Program specific review process: Continuation of enrollment. A State must ensure the opportunity for continuation of enrollment and benefits pending the completion of review of the following: (a) A suspension or termination of enrollment, including a decision to disenroll for failure to pay cost sharing; and (b) A failure to make a timely determination of eligibility at application and renewal. [89 FR 22877, Apr. 2, 2024] § 457.1180 Program specific review process: Notice. A State must provide enrollees and applicants timely written notice of any determinations required to be subject to review under § 457.1130 that includes the reasons for the determination, an explanation of applicable rights to review of that determination, the standard and expedited time frames for review, the manner in which a review can be requested, and the circumstances under which enrollment and benefits may continue pending review. [89 FR 22877, Apr. 2, 2024] § 457.1190 Application of review procedures when States offer premium assistance for group health plans. A State that has a premium assistance program through which it provides coverage under a group health plan that does not meet the requirements of a program specific review or a Statewide standard review, as described in § 457.1120, must give applicants and enrollees the option to obtain health benefits coverage other than through that group health plan. The State must provide this option at initial enrollment and at each redetermination of eligibility. [66 FR 2686, Jan. 11, 2001, as amended at 66 FR 33824, June 25, 2001] Subpart L—Managed Care Source: 81 FR 27897, May 6, 2016, unless otherwise noted. General Provisions § 457.1200 Basis, scope, and applicability. (a) Statutory basis. (1) Section 2101(a) of the Act, which provides that the purpose of Title XXI is to provide funds to States to enable them to initiate and expand the provision of child health assistance to uninsured, low-income children in an effective and efficient manner. (2) Section 2103(f)(3) and 2107(e)(1)(M) of the Act, which apply certain provisions of Title XIX related to Medicaid managed care to CHIP. (3) Sections 2107(b) and 2107(e)(2) of the Act, which relate to program integrity. (b) Scope. (c) Applicability. (d) Applicability dates. [81 FR 27897, May 6, 2016, as amended at 89 FR 41284, May 10, 2024] § 457.1201 Standard contract requirements. (a) CMS review. (b) Entities eligible for comprehensive risk contracts. (c) Payment. (d) Enrollment discrimination prohibited. (e) Services that may be covered by an MCO, PIHP, or PAHP. (f) Compliance with applicable laws and conflict of interest safeguards. (g) Inspection and audit of records and access to facilities. (h) Physician incentive plans. (i) Subcontractual relationships and delegations. (j) Choice of network provider. (k) Audited financial reports. (l) Parity in mental health and substance use disorder benefits. (m) Additional rules for contracts with PCCMs. (n) Additional rules for contracts with PCCM entities. (2) Contracts with PCCMs must comply with the requirements of paragraph (o) of this section; § 457.1207; § 457.1240(b) (cross-referencing § 438.330(b)(2), (b)(3), (c), and (e) of this chapter); § 457.1240(e) (cross-referencing § 438.340 of this chapter). (o) Attestations. (p) Guarantee not to avoid costs. (q) Recordkeeping requirements. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; May 10, 2024] § 457.1203 Rate development standards and medical loss ratio. (a) A state must use payment rates based on public or private payment rates for comparable services for comparable populations, consistent with actuarially sound principles as defined at § 457.10. This requirement for using actuarially sound principles to develop payment rates does not prohibit a state from implementing value-based purchasing models for provider reimbursement, such as pay for performance arrangements, bundled payments, or other service payment models intended to recognize value or outcomes over volume of services; such alternate payment models should be developed using actuarially sound principles to the extent applicable. (b) A State may establish higher rates than permitted under paragraph (a) of this section if such rates are necessary to ensure sufficient provider participation or provider access or to enroll providers who demonstrate exceptional efficiency or quality in the provision of services. (c) The rates must be designed to reasonably achieve a medical loss ratio standard, calculated in accordance with the provisions of § 438.8 of this chapter, that— (1) Is equal to at least 85 percent for the rate year; and (2) Provides for reasonable administrative costs. (d) The State must provide to CMS, if requested, a description of the manner in which rates were developed in accordance with the requirements of paragraphs (a), (b), or (c) of this section. (e) The State must comply with the requirements related to medical loss ratios in accordance with the terms of § 438.74 of this chapter, except contract arrangements described in § 438.6(c) do not apply and the description of the reports received from the MCOs, PIHPs and PAHPs under § 438.8(k) of this chapter will be submitted independently, and not with the rate certification described in § 438.7 of this chapter. (f) The State must ensure, through its contracts, that each MCO, PIHP, and PAHP complies with the requirements in § 438.8 of this chapter, except that contract arrangements described in § 438.6(c) do not apply. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; 89 FR 41285, May 10, 2024] § 457.1206 Non-emergency medical transportation PAHPs. (a) For purposes of this section Non-Emergency Medical Transportation (NEMT) Prepaid Ambulatory Health Plan (PAHP) means an entity that provides only NEMT services to enrollees under contract with the State, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates. (b) The following requirements and options apply to NEMT PAHPs, NEMT PAHP contracts, and States in connection with NEMT PAHPs, to the same extent that they apply to PAHPs, PAHP contracts, and States in connection with PAHPs. (1) All contract provisions in § 457.1201 except those set forth in § 457.1201(h) (related to physician incentive plans) § 457.1201(l) (related to mental health parity). (2) The information requirements in § 457.1207. (3) The provision against provider discrimination in § 457.1208. (4) The State responsibility provisions in §§ 457.1212 and 457.1214, and § 438.62(a) of this chapter, as cross-referenced in § 457.1216. (5) The provisions on enrollee rights and protections in §§ 457.1220, 457.1222, 457.1224, and 457.1226. (6) The PAHP standards in § 438.206(b)(1) of this chapter, as cross-referenced by §§ 457.1230(a) and (d) and 457.1233(a), (b), and (d), excluding the requirement in § 438.242(b)(7) of this chapter to comply with § 431.61(a) of this chapter. (7) An enrollee's right to a State review under subpart K of this part. (8) Prohibitions against affiliations with individuals debarred or excluded by Federal agencies in § 438.610 of this chapter, as cross referenced by § 457.1285. (9) Requirements relating to contracts involving Indians, Indian Health Care Providers, and Indian managed care entities in § 457.1209. [81 FR 27897, May 6, 2016, as amended at 89 FR 8985, Feb. 8, 2024] § 457.1207 Information requirements. The State must provide, or ensure its contracted MCO, PAHP, PIHP, PCCM, and PCCM entities provide, all enrollment notices, informational materials, and instructional materials related to enrollees and potential enrollees in accordance with the terms of § 438.10 of this chapter, except that the terms of § 438.10(c)(2), (g)(2)(xi)(E), and (g)(2)(xii) of this chapter do not apply and that references to enrollee rights and protections under part 438 should be read to refer to the rights and protections under subparts K and L of this part. The State must annually post comparative summary results of enrollee experience surveys by managed care plan on the State's website as described at § 438.10(c)(3) of this chapter. [89 FR 41285, May 10, 2024] § 457.1208 Provider discrimination prohibited. The state must ensure through its contracts that each MCO, PIHP, and PAHP follow the requirements related to the prohibition on provider discrimination in § 438.12 of this chapter. § 457.1209 Requirements that apply to MCO, PIHP, PAHP, PCCM, and PCCM entity contracts involving Indians, Indian health care provider (IHCP), and Indian managed care entities (IMCE). The State must follow, and ensure through its contracts, that each MCO, PIHP, PAHP, PCCM, and PCCM entity follows, the requirements related to Indians, IHCPs, and IMCEs in accordance with the terms of § 438.14 of this chapter. State Responsibilities § 457.1210 Enrollment process. (a) Default enrollment process. (i) Assign beneficiaries to a qualified MCO, PIHP, PAHP, PCCM or PCCM entity. To be qualified, the MCO, PIHP, PAHP, PCCM or PCCM entity must: (A) Not be subject to the intermediate sanction described in § 438.702(a)(4) of this chapter. (B) Have capacity to enroll beneficiaries. (ii) Maximize continuation of existing provider-beneficiary relationships. An “existing provider-beneficiary relationship” is one in which the provider was the main source of CHIP services for the beneficiary during the previous year. This may be established through State records of previous managed care enrollment or fee-for-service experience, encounter data, or through contact with the beneficiary. (iii) If the approach in paragraph (a)(1)(ii) of this section is not possible, the State must distribute the beneficiaries equitably among the MCOs, PIHPs, PAHPs, PCCMs and PCCM entities. The State may not arbitrarily exclude any MCO, PIHP, PAHP, PCCM or PCCM entity from being considered. (2) The State may consider additional reasonable criteria to conduct the default enrollment process, including the previous plan assignment of the beneficiary, quality assurance and improvement performance, procurement evaluation elements, accessibility of provider offices for people with disabilities (when appropriate), and other reasonable criteria that support the objectives of the managed care program. (3) The State must send a confirmation of the enrollee's managed care enrollment to the enrollee within 5 calendar days of the date such enrollment is processed by the State. The confirmation must clearly explain the enrollee's right to disenroll within 90 days from the effective date of the enrollment. (b) Priority for enrollment. (c) Informational notices. (1) Include the MCOs, PIHPs, PAHPs, PCCMs, or PCCM entities available to the potential enrollee; (2) Explain how to select an MCO, PIHP, PAHP, PCCM, or PCCM entity; (3) Explain the implications of making or not making an active choice of an MCO, PIHP, PAHP, PCCM or PCCM entity; (4) Explain the length of the enrollment period as well as the disenrollment policies in § 457.1212; and (5) Comply with the information requirements in § 457.1207 and accessibility standards established under § 457.340. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017] § 457.1212 Disenrollment. The State must comply with and ensure, through its contracts, that each MCO, PAHP, PIHP, PCCM and PCCM entity complies with the disenrollment requirements in accordance with the terms of § 438.56 of this chapter, except that references to fair hearings should be read to refer to reviews as described in subpart K of this part. § 457.1214 Conflict of interest safeguards. The State must have in effect safeguards against conflict of interest in accordance with the terms of § 438.58 of this chapter, except that references to § 438.54(b) should be read to refer to the enrollment processes described in § 457.1210(a). [82 FR 40, Jan. 3, 2017] § 457.1216 Continued services to enrollees. The State must follow the requirements related to continued services to enrollees in accordance with the terms of § 438.62 of this chapter. § 457.1218 Network adequacy standards. The State must develop network adequacy standards in accordance with the terms of § 438.68 of this chapter, and, ensure through its contracts, that each MCO, PAHP, and PIHP meets such standards. Enrollee Rights and Protections § 457.1220 Enrollee rights. The State must ensure, through its contracts, that each MCO, PIHP, PAHP, PCCM, and PCCM entity follow the enrollee rights requirements in accordance with the terms of § 438.100 of this chapter. § 457.1222 Provider-enrollee communication. The State must ensure, through its contracts, that each MCO, PIHP, and PAHP protects communications between providers and enrollees in accordance with the terms of § 438.102 of this chapter. § 457.1224 Marketing activities. The State must ensure, through its contracts, that each MCO, PIHP, PAHP, PCCM, and PCCM entity follows the requirements related to marketing activities in accordance with the terms of § 438.104 of this chapter, except § 438.104(c) of this chapter related to state agency review does not apply. § 457.1226 Liability for payment. The State must ensure, through its contracts, that enrollees of MCOs, PIHPs, and PAHPs are not held liable for services or debts of the MCO, PIHP, or PAHPs in accordance with the terms of § 438.106 of this chapter. § 457.1228 Emergency and poststabilization services. The State must ensure that emergency and poststabilization care services are available and accessible to enrollees in accordance with the terms of § 438.114 of this chapter. [82 FR 40, Jan. 3, 2017] MCO, PIHP, and PAHP Standards § 457.1230 Access standards. (a) Availability of services. (b) Assurances of adequate capacity and services. (c) Coordination and continuity of care. (d) Coverage and authorization of services. (1) Section 438.210(a)(5) of this chapter (related to medical necessity standard). (2) Section 438.210(b)(2)(iii) of this chapter (related to authorizing long term services and supports (LTSS)). [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; 89 FR 8985, Feb. 8, 2024; 89 FR 41285, May 10, 2024] § 457.1233 Structure and operation standards. (a) Provider selection. (b) Subcontractual relationships and delegation. (c) Practice guidelines. (d) Health information systems. (e) Privacy protections. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; 85 FR 25637, May 1, 2020; 85 FR 72842, Nov. 13, 2020] Quality Measurement and Improvement; External Quality Review § 457.1240 Quality measurement and improvement. (a) Scope. (b) Quality assessment and performance improvement program. (2) In the case of a contract with a PCCM entity described in paragraph (f) of this section, § 438.330(b)(2) and (3), (c), and (e) of this chapter apply. (c) State review of the accreditation status of MCOs, PIHPs, and PAHPs. (d) Managed care quality rating system. (e) Managed care quality strategy. (f) Applicability to PCCM entities. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; 85 FR 72842, Nov. 13, 2020; 89 FR 41285, May 10, 2024] § 457.1250 External quality review. (a) Each State that contracts with MCOs, PIHPs, or PAHPs must follow all applicable external quality review requirements as set forth in §§ 438.350 (except for references to § 438.362), 438.352, 438.354, 438.356, 438.358 (except for references to § 438.6), 438.360 (only for nonduplication of EQR activities with private accreditation) and 438.364 of this chapter. (b) A State may amend an existing EQRO contract to include the performance of EQR-related activities and/or EQR in accordance with paragraph (a) of this section. [81 FR 27897, May 6, 2016, as amended at 82 FR 40, Jan. 3, 2017; 89 FR 41285, May 10, 2024] Grievance System § 457.1260 Grievance system. (a) Statutory basis and definitions Statutory basis. (2) Definitions. (i) Paragraphs (1) through (5) and (7) of the definition of “adverse benefit determination”; and (ii) The definitions of “appeal”, “grievance”, and “grievance and appeal system”. (b) General requirements. (2) An enrollee may file a grievance and request an appeal with the MCO, PIHP, or PAHP. An enrollee may request a State external review in accordance with the terms of subpart K of this part after receiving notice under paragraph (e) of this section that the adverse benefit decision is upheld by the MCO, PIHP, or PAHP. (3) If State law permits and with the written consent of the enrollee, a provider or an authorized representative may request an appeal or file a grievance, or request a State external review in accordance with the terms of subpart K of this part, on behalf of an enrollee. When the term “enrollee” is used throughout this section, it includes providers and authorized representatives consistent with this paragraph (b). (c) Timely and adequate notice of adverse benefit determination. (2) In addition to the requirements referenced in paragraph (c)(1) of this section, the notice must explain: (i) The enrollee's right to request an appeal of the MCO's, PIHP's, or PAHP's adverse benefit determination, including information on exhausting the MCO's, PIHP's, or PAHP's one level of appeal described at § 438.402(b) of this chapter referenced in paragraph (b)(1) of this section, and the right to request a State external review in accordance with the terms of subpart K of this part; and (ii) The procedures for the enrollee to exercise his or her rights provided under this paragraph (c). (3) The MCO, PIHP, or PAHP must provide timely written notice to the enrollee of the adverse benefit determination. The terms of §§ 438.404(c)(6) and 438.210(d)(2) of this chapter apply in the circumstances of expedited service authorization decisions. (d) Handling of grievances and appeals. (e) Resolution and notification: Grievances and appeals. (2) Each MCO, PIHP, or PAHP must resolve each grievance and appeal, and provide notice, as expeditiously as the enrollee's health condition requires, within State-established timeframes that may not exceed the timeframes specified in this paragraph (e). (3) In the case of an MCO, PIHP, or PAHP that fails to adhere to the notice and timing requirements in this section, the enrollee is deemed to have exhausted the MCO's, PIHP's, or PAHP's appeals process. The enrollee may initiate a State external review in accordance with the terms of subpart K of this part. (4) For appeals not resolved wholly in favor of an enrollee, in addition to the information required under paragraph (e)(1) of this section and § 438.408(e)(1) of this chapter, the content of the notice of appeal resolution must include the enrollee's right to request a State external review in accordance with the terms of subpart K of this part, and how to do so. (5) Except as provided in paragraph (e)(3) of this section, an enrollee may request a State external review only after receiving notice that the MCO, PIHP, or PAHP is upholding the adverse benefit determination. The State must provide enrollees no less than 90 calendar days and no more than 120 calendar days from the date of the MCO's, PIHP's, or PAHP's notice of resolution to request a State external review. The parties to the State external review include the MCO, PIHP, or PAHP, as well as the enrollee and his or her representative or the representative of a deceased enrollee's estate. (f) Expedited resolution of appeals. (g) Information about the grievance and appeal system to providers and subcontractors. (h) Recordkeeping requirements. (i) Effectuation of reversed appeal resolutions. [85 FR 72842, Nov. 13, 2020] Sanctions § 457.1270 Sanctions. (a) General. (b) Optional imposition of temporary management. (1) There is continued egregious behavior by the MCO, including but not limited to behavior that is described in § 438.700 of this chapter (as referenced in paragraph (a) of this section), or that is contrary to any of the requirements of this subpart. (2) There is substantial risk to enrollees' health. (3) The sanction is necessary to ensure the health of the MCO's enrollees— (i) While improvements are made to remedy violations under § 438.700 of this chapter as referenced in paragraph (a) of this section. (ii) Until there is an orderly termination or reorganization of the MCO. (c) Required imposition of temporary management. [85 FR 72843, Nov. 13, 2020] § 457.1280 Conditions necessary to contract as an MCO, PAHP, or PIHP. (a) The State must assure that any entity seeking to contract as an MCO, PAHP, or PIHP under a separate child health program has administrative and management arrangements or procedures designed to safeguard against fraud and abuse. (b) The State must ensure that the arrangements or procedures required in paragraph (a) of this section— (1) Enforce MCO, PAHP, and PIHP compliance with all applicable Federal and State statutes, regulations, and standards. (2) Prohibit MCOs, PAHPs, and PIHPs from conducting any unsolicited personal contact with a potential enrollee by an employee or agent of the MCO, PAHP, or PIHP for the purpose of influencing the individual to enroll with the entity. (3) Include a mechanism for MCOs, PAHPs, and PIHPs to report to the State, to CMS, or to the Office of Inspector General (OIG) as appropriate, information on violations of law by subcontractors, providers, or enrollees of an MCO, PAHP, or PIHP and other individuals. (c) With respect to enrollees, the reporting requirement in paragraph (b)(3) of this section applies only to information on violations of law that pertain to enrollment in the plan, or the provision of, or payment for, health services. (d) The State may inspect, evaluate, and audit MCOs, PIHPs, and PAHPs at any time, as necessary, in instances where the State determines that there is a reasonable possibility of fraudulent or abusive activity. [66 FR 2685, Jan. 11, 2011. Redesignated and amended at 81 FR 27900, May 6, 2016] § 457.1285 Program integrity safeguards. The State must comply with the program integrity safeguards in accordance with the terms of subpart H of part 438 of this chapter, except that the terms of §§ 438.66(e), 438.362(c), 438.602(g)(6) and (10), 438.604(a)(2), 438.608(d)(4) and references to LTSS of this chapter do not apply and that references to subpart K under part 438 should be read to refer to parity requirements at § 457.496. [89 FR 41285, May 10, 2024]

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