A. Chapter Contents

This chapter contains the following topics:

Topic

201.00    Federal Authorities

202.00 State Authorities

203.00 The AHCCCS 1115 Waiver

204.00    The State Plan

B. Introduction

The Central Office, Program Support Administration develops the policy contained in this manual using the following authorities:

• Federal and state government;

• Waivers;

• State Plan; and

• Directives from executive management.

A. Introduction

The federal authorities are the major framework for the Medicaid, ALTCS, Medicare Cost Sharing, and KidsCare programs. The federal government provides options to states to develop these programs. The states use these options to individualize the programs for each state. Federal authorities used to develop eligibility policy for the Medicaid and KidsCare programs include:

• Public Laws;

• Social Security Act (the Act);

• United States Code (USC);

• Code of Federal Regulations;

• State Medicaid Manual;

• CMS Guidance;

• CMS Letters to State Medicaid Directors;

• Social Security Administration's Program Operations Manual (POMS); and

• Federal Register.

B. Public Law

A Public Law is a printing of the full text of a new law or an amendment to an existing law after it has been enacted by Congress and signed by the President. Public Laws are later codified (collected and arranged) in the U.S. Code along with all other Federal Laws.

C. Social Security Act

The Social Security Act covers all aspects of Social Security. AHCCCS authorizes health care coverage in compliance with three titles of the Act. The table below provides a description of each title.

Title

Description

XVI

Title XVI of the Act is the Supplemental Security Income program for the aged, blind, and disabled individuals who have low income. AHCCCS uses this Title for SSI-MAO and ALTCS.

XIX

Title XIX of the Act refers to Medicaid. It identifies the mandatory and optional coverage groups and the basic conditions of eligibility for each.

XXI

Title XXI provides funds to states to enable them to initiate and expand the provision of children's health insurance to uninsured, low-income children. KidsCare is Arizona's State Children's Health Insurance Program. With federal approval, AHCCCS uses Title XXI to provide coverage under other AHCCCS programs (MS 203.00.E.).

See http://www.ssa.gov/OP_Home/ssact/comp-toc.htm to view the Social Security Act.

D. United States Code (USC)

The USC contains federal law made by Congress. It is a consolidation and codification by subject matter of the general and permanent laws of the United States.  

See http://www.access.gpo.gov/uscode to view the USC.

E. Code of Federal Regulations (CFR)

The CFR is a codification of general and permanent rules (regulations) that have been previously published in the Federal Register. The CFR provides more detail about conditions of eligibility than the USC. AHCCCS Health Insurance programs and coverage groups are described in:

• 42 CFR - Public Health;

• 20 CFR - Supplemental Security Income; and

• 45 CFR - Public Welfare. 

See http://www.gpoaccess.gov/fr/index.html to view the CFR.

F. State Medicaid Manual (SMM)

The SMM is developed by the Centers for Medicare and Medicaid Services (CMS). Its purpose is to provide policy guidance for the Medicaid requirements contained in the CFR.

See http://www.cms.hhs.gov/manuals/pub45/pub_45.asp to view the State Medicaid Manual.

G. Center for Medicare and Medicaid (CMS) Guidance

CMS issues State Medicaid Director letters to all Directors of State Medicaid agencies. They provide information and/or guidance to the states on Medicaid and State Children's Health Insurance Program (SCHIP) topics.

See http://www.cms.hhs.gov/states/letters/default.asp to view Medicaid related letters. See http://www.cms.hhs.gov/schip/sho-letters/ to view SCHIP related letters.

CMS Rulings are final decisions of the Administrator that clarify complex or unclear provisions of the law or regulations relating to Medicaid or SCHIP. 

See http://www.cms.hhs.gov/rulings/ to view CMS Rulings.

H. SSA's Program Operations Manual (POMS)

POMS is the internal operating instructions used by SSA to process claims for Social Security benefits. The Central Office, Program Support Administration uses POMS to assist in developing eligibility policy for ALTCS and SSI-MAO. 

See http://policy.ssa.gov/poms.nsf/aboutpoms to view POMS.

I. Federal Register

The Federal Register is the official daily publication of the U.S. government which contains new regulations, changes to the Code of Federal Regulations, and legal notices issued by Federal agencies and the President. For example, the Federal Benefit Rate (FBR) and Federal Poverty Level (FPL) limits are published annually in the Federal Register. Policy specialists review the Federal Register every day and provide written summaries of new information to executive management. 

See http://www.gpoaccess.gov/fr/index.html to view the Federal Register.

A. Introduction

State laws are developed based on the Federal laws and regulations made by Congress and the Federal government. The Central Office, Program Support Administration researches several state authorities to develop eligibility policy.

B. Arizona Revised Statutes (ARS)

The ARS are made by the Arizona legislature and are equivalent to the Federal Laws in the USC. The following AHCCCS related statutes are located in Title 36, Chapter 29:

• Article 1 Medicaid and Healthcare Group;

• Article 2 ALTCS;

• Article 3 QMB; and

• Article 4 Children's State Health Insurance Program (KidsCare). 

See http://www.azleg.state.az.us/ArizonaRevisedStatutes.asp to view the ARS.

C. Arizona Administrative Code (AAC)

The AAC is commonly referred to as the Rules. The AAC is developed by the responsible state agency and approved by the Governor's Regulatory Review Council (GRRC). The AAC provides more detail than the ARS. The AHCCCS related rules are located in Title 9:

• Chapter 22 Medicaid;

• Chapter 27 Healthcare Group;

• Chapter 28 ALTCS;

• Chapter 29 QMB; and

• Chapter 31 KidsCare. 

See http://www.azsos.gov/Rules_and_regulations.htm to view the AAC.

D. Arizona Administrative Register (AAR)

The AAR is the official publication of the State of Arizona which contains rules approved by the GRRC but not yet published in the AAC.

See http://www.sosaz.com/aar to view the AAR.

E. Eligibility Policy and Procedure Manuals

Each state is required to maintain Eligibility Policy and Procedure Manuals for all of the programs and coverage groups. Arizona's Eligibility Policy and Procedure Manuals are developed and maintained by the following agencies:

 Agency:

Eligibility Policy and Procedures for:

AHCCCS, Central Office, Program Support Administration

• ALTCS

• SSI-MAO

• Medicare Cost Sharing

• KidsCare

• Health Insurance for Parents

• Breast & Cervical Cancer Treatment Program

• AHCCCS Freedom to Work

AHCCCS, Healthcare Group Administration

Healthcare Group

Department of Economic Security, Family Assistance Administration

• AHCCCS For Families with Children

• S.O.B.R.A.

• AHCCCS Care

• MED

A. The AHCCCS 1115 Waiver

States must comply with Title XIX and Title XXI of the Act. Since AHCCCS began on October 1, 1982, the agency has been exempt from specific provisions of the SSA under an 1115 Research and Demonstration Waiver. The number 1115 refers to section 1115 of the Act.

B. What is in the AHCCCS 1115 Waiver?

The AHCCCS 1115 Waiver contains:

• Provisions in the Act from which AHCCCS is waived;

• Expenditure authority for certain items under section 1903 of the Act;

• Terms and conditions that AHCCCS must fulfill, which includes documents and reports that must be submitted during the year;

• Approved federal budget amounts; and

• Four attachments that outline financial, legislative, and budget neutrality requirements.

C. Title XIX Eligibility Waivers

The AHCCCS waivers frequently change in response to the changing health care needs of Arizonians. AHCCCS has waivers under the authority of section 1115 (a)(1) of the Act that are related to Title XIX eligibility, which means that certain eligibility requirements are waived. The waivers related to eligibility for all customers include:

• To grant eligibility no earlier than the application month rather than up to 3 months prior to the month of application (Prior Quarter); and

• To exclude hospitalized non-ALTCS recipients from the post eligibility share of cost requirements.

The waivers related to eligibility for customers who are age 65 or older, blind or disabled and whose eligibility is based on a coverage group related to SSI include:

• To exclude certain income in the ALTCS post eligibility calculation of income that is disregarded in the ALTCS eligibility determination;

• To exclude infrequent income when determining eligibility;

• To not wait 30 days to use the special income limit (300% FBR) for the ALTCS coverage group described in 42 CFR 435.336;

• To disregard the value of inkind support and maintenance as income (ISM);

• To disregard the income and resources of responsible relatives for ALTCS in the month of separation;

• To use couple budgeting;

• To disregard certain resources in the eligibility determination for ALTCS;

• To disregard the value of certain resources as of the 1^st day of the month; and

• To substitute the Preadmission Screening (PAS) for a disability determination for ALTCS.

D. Title XIX Method of Service Delivery Waivers

AHCCCS also has authority under section 1115 (a)(1) of the Act to waive requirements related to Arizona's method of service delivery. These waivers include:

• To impose co-payments on mandatory services for certain individuals except children or pregnant women enrolled in AHCCCS;

• To give the State greater flexibility in provider reimbursement and to make capitated payments, which is called reimbursement agreement;

• To restrict freedom of choice to AHCCCS contractors, which permits AHCCCS to operate a managed care system;

• To receive payment for outpatient drugs without complying with OBRA 90 drug rebate revisions; and

• To exclude customers who are hospitalized for over 30 days and who are not at risk of institutionalization from automatically being enrolled in the ALTCS program.

E. Title XXI Waiver

Under the Health Insurance Flexibility and Accountability Act (HIFA) demonstration initiative, AHCCCS modified the 1115 waiver to use Title XXI funds to expand coverage to:

• Adults over age 18 without dependent children with adjusted net family income at or below 100% FPL; and

• Parents of children eligible for KidsCare or S.O.B.R.A. individuals with gross family income above 100% FPL and at or below 200% FPL, who are not eligible for Medicaid.

A. Definition of the State Plan

Arizona has a Medicaid State Plan and a KidsCare State Plan. A State Plan is a comprehensive written contract between AHCCCS and the Centers for Medicare and Medicaid Services (CMS) that describes the nature and scope of its Medicaid programs. 

B. Purpose of the State Plan

The State Plan assures that Arizona will administer the Medicaid and KidsCare programs according to federal requirements under provisions of the Social Security Act and provides a basis for Federal Financial Participation (FFP). The CMS has the responsibility for approval of the State Plan at the federal level.

C. AHCCCS Responsibility

AHCCCS is Arizona's state agency with the responsibility for the State Plan. AHCCCS submits amendments to reflect changes in federal law, regulation, policy, or court decisions. The methods used for determining eligibility for AHCCCS programs or coverage groups may be modified by Arizona's waiver or by Arizona's Medicaid State Plan or KidsCare's State Plan.

D. Medicaid State Plan

The Medicaid State Plan is divided into seven sections:

• Single State Agency Organization;

• Coverage and Eligibility;

• Services: General Provisions;

• General Program Administration;

• Personnel Administration;

• Financial Administration; and

• General Provisions.

See www.cms.gov/medicaid/stateplans/toc.asp?state=AZ to view Arizona's Medicaid State Plan.

E. KidsCare State Plan

The KidsCare State Plan is divided into 12 sections:

• General Description and Purpose of the State Child Health Plans and State Child Health Plan Requirements;

• General Background and Description of State Approach to Child Health Coverage and Coordination;

• Methods of Delivery and Utilization Controls;

• Eligibility Standards and Methodology;

• Outreach;

• Coverage Requirements for Children's Health Insurance;

• Quality and Appropriateness of Care;

• Cost Sharing and Payment;

• Strategic Objectives and Performance Goals and Plan Administration;

• Annual Reports and Evaluations;

• Program Integrity; and

• Applicant and Enrollee Protections.

See http://www.cms.hhs.gov/schip/stateplans/chipaz.asp?state=AZ to view the KidsCare State Plan.