A. Decision to Revise Certain Eligibility and Enrollment Regulations To Implement Community Engagement

Under section 71119 of the WFTC legislation, Congress has directed us to implement a community engagement requirement and directed that any action taken to implement this requirement not be subject to the provisions of 5 U.S.C. 553 . Implementation of the community engagement requirement requires ensuring related regulations reflect current and effective policy. Currently, the regulations do not contain current and effective policies related to application requirements, redeterminations of eligibility during periodic renewals, redeterminations of eligibility in between renewals based on a change in circumstances, and timeliness standards to process eligibility and enrollment actions.

Section 71102 of the WFTC legislation precludes CMS from implementing, administering, or enforcing amendments made by provisions of the final rule titled “Medicaid Program; Streamlining the Medicaid, Children's Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes” ( 89 FR 22780 ) (hereinafter referred to as the 2024 Eligibility and Enrollment final rule) for Federal regulations specified in section 71102 of the WFTC legislation until after September 30, 2034. This prohibition renders the amendments made by the 2024 Eligibility and Enrollment final rule to the specified regulatory provisions unenforceable prior to October 1, 2034, effectively suspending these provisions during that period (herein referred to as the section 71102 moratorium).

Many of the regulations amended by the 2024 Eligibility and Enrollment final rule that are now subject to the section 71102 moratorium are necessary to implement the community engagement requirement successfully. For example, section 1902(xx) of the Act, as added by section 71119 of the WFTC legislation, requires States to verify, at renewal, that individuals satisfy the community engagement requirement. However, the regulatory provisions governing renewals are among those suspended by the section 71102 moratorium because the moratorium suspends amendments made by the 2024 Eligibility and Enrollment final rule to § 435.916, which establishes requirements for States to conduct periodic renewals of eligibility. As a result, there are currently no enforceable regulations in effect governing renewals of eligibility that CMS could cite in implementing the new community engagement requirement.

Accordingly, it would not be feasible to establish an enforceable community engagement requirement where the implementing regulations would need to rely on suspended eligibility and enrollment policies. In addition to renewal requirements, the section 71102 moratorium also suspends regulatory provisions relating to application requirements, procedures for acting on changes in circumstances that may affect eligibility, and timeliness standards for processing eligibility and enrollment actions. Because current and effective Federal regulations no longer comprehensively address these core eligibility and enrollment processes, CMS would be significantly constrained in its ability to implement section 71119 of the WFTC legislation and enforce provisions of the IFC while the moratorium is in effect.

To implement community engagement while the section 71102 moratorium is in effect, it is therefore necessary to restore, for regulations impacted by the section 71102 moratorium, the previous version of the Code of Federal Regulations (CFR) that was in effect prior to the effective date of the 2024 Eligibility and Enrollment final rule. The restoration of the previous version of the CFR for certain provisions will ensure that the regulations reflect current legal authority and CMS policy to support implementation of community engagement while the section 71102 moratorium is in effect. For the period until October 1, 2034, this IFC restores the following regulations as they existed before the 2024 Eligibility and Enrollment final rule: §§ 431.213(d), 431.231(d), 435.907, 435.911(c), 435.912, 435.916, 435.919, 457.340(d)(1), 457.344, and 457.960. We also make a corresponding edit to remove a cross-reference at § 435.1200(e)(1), that would no longer exist, with the revisions to revert to the previous version of the CFR and make conforming changes to affected CHIP regulations, which cross-reference to Medicaid regulations. The changes to these provisions are either necessary to implement the community engagement requirement in this IFC or are conforming changes to the Medicaid and CHIP regulations because of the implications of the revisions to restore the previous version of the CFR. For the period until October 1, 2034, the changes are as follows:

§§ 431.213(d) and 431.231(d) concerning whereabouts unknown based on returned mail are revised to reflect the version of the CFR for these paragraphs in effect as of June 2, 2024, as a conforming change to restore regulations that were relocated by the 2024 Eligibility and Enrollment final rule to § 435.919, which is removed as noted in this section.

§ 435.907(c)(4) concerning modalities for States to accept non-MAGI (modified adjusted gross income) application forms is removed, which is affected by the section 71102 moratorium.

§ 435.907(d)(1) and (2) concerning the minimum time for applicants to respond to requests for information, the provision of a reconsideration period at application, and expansion of the prohibition on in-person interviews, are removed because they are affected by the section 71102 moratorium and replaced with § 435.907(d) of the CFR in effect as of June 2, 2024.

§ 435.911(c) is revised to reflect the version of the CFR for this paragraph in effect as of June 2, 2024, to remove cross-references removed in this IFC, which is affected by the section 71102 moratorium.

§§ 435.912 concerning timeliness standards and 435.916 concerning redeterminations of eligibility, which are affected by the section 71102 moratorium, are replaced in their entirety with the version of the CFR in effect as of June 2, 2024.

§ 435.919 concerning acting on changes in circumstances and updating contact information, which is affected by the section 71102 moratorium, is removed.

§ 435.1200(e)(1) is amended to remove the phrase “(regarding regularly-scheduled renewals of eligibility) or § 435.919 (regarding changes in circumstances)” as a conforming change because we remove § 435.919 in this IFC.

§ 457.340(d)(1) is revised to reflect the version of the CFR for this paragraph in effect as of June 2, 2024, to conform with revisions to § 435.912.

§ 457.344 is removed to conform with revisions to restore the previous version of the CFR for §§ 435.912 and 435.916 and the removal of § 435.919.

§ 457.960 is revised to conform with changes to reflect the previous version of the CFR because § 457.344 is removed.

In this IFC, we limit revisions to the regulations: (1) to restore the previous version of the CFR for requirements affected by the moratorium, when needed to implement community engagement, and (2) when conforming changes are needed for consistency. At this time, we are not updating the CFR ( printed page 33353) to restore other regulations [ 27 ] impacted by section 71102 of the WFTC legislation to their versions in effect prior to the 2024 Eligibility and Enrollment final rule and are not amending the policies in the restored regulations because such action falls outside the scope of the Congress's directive under section 71119 of the WFTC legislation. We do not permanently restore the CFR as such action also falls outside the scope of Congress's directive under section 71119 of the WFTC legislation. Because we modify the CFR to restore the regulations which are necessary to implement the community engagement requirement and sunset the provisions on October 1, 2034, we will follow applicable rulemaking procedures to ensure that policies governing Medicaid and CHIP eligibility and enrollment are implemented and effective on October 1, 2034, replacing the policies scheduled to sunset on that date.

Separately, the regulations that we are updating so that they reflect the versions in effect prior to the 2024 Eligibility and Enrollment final rule are referenced throughout this IFC. In accordance with the changes discussed here, the references to the regulations affected by the section 71102 moratorium in the preamble, regulatory impact analysis, collection of information, and cross-referenced in regulatory text should be interpreted as referring to the prior CFR versions implemented in this IFC.