HHS, USDA Provide Additional Details on Cost Allocation Flexibility
Issue Brief 12-03
The
Affordable Care Act (ACA, P.L. 111-148 and P.L. 111-152) included a number of
changes that affect Medicaid eligibility and require upgrades to Medicaid
enrollment systems. While extensive coordination and collaboration is required
between health benefit exchanges and Medicaid systems, many states are
considering ways to coordinate system changes with the eligibility
determination systems used for human services programs. To encourage states to
develop more integrated eligibility determination systems, the departments of
Health and Human Services (HHS) and Agriculture (USDA) announced in August 2011,
a time-limited, specific exception to the cost allocation requirements in
section C.3 of OMB Circular A-87. Specifically, the exception allows federally funded
human services programs to benefit from the investments in state eligibility
systems being made by state-operated Exchanges, Medicaid, and the Children’s
Health Insurance Program (CHIP), without having to share in the common system
development costs.
On January 23, 2012, HHS and USDA released additional guidance to states on this exception, including examples of allowable shared services and more details on the process.