Release of Updated CMS Guidance on Continuous Eligibility for Medicaid/CHIP Children and Youth
Julia Smith and Michelle Savuto, Manatt Health
On January 15, 2025, the Centers for Medicare & Medicaid Services (CMS) released updated State Health Official (SHO) letter and Frequently Asked Questions (FAQs) guidance, replacing a previously issued SHO letter and FAQs on the requirement in the Consolidated Appropriations Act, 2023 (CAA) that states provide 12 months of continuous eligibility (CE) for children and youth under the age of 19 in Medicaid and the Children’s Health Insurance Program (CHIP), effective as of January 1, 2024.
The updated SHO letter and FAQs, like previous guidance (for more information, please see SHVS’ expert perspectives here and here), emphasize the importance of CE for improving continuity of care and health outcomes for children and youth and define the parameters of the CE requirement set forth in the CAA. In the updated guidance, CMS provides new clarity about several aspects of the CE requirement. Specifically, CMS provides in the new guidance that:
- In the case of a child/youth transitioning from CHIP to Medicaid in the middle of a CE period, states may (1) maintain a child or youth’s enrollment in Medicaid for the remaining duration of their current CE period and conduct a full eligibility renewal at that time (as newly permitted under the updated guidance); or alternatively (2) provide a child/youth with a new 12-month CE period based on the date the child/youth was determined eligible for Medicaid, and conduct a full eligibility renewal at the end of the new 12-month CE period.[1]
- States are prohibited from disenrolling children or youth from CHIP during a CE period for failure to pay premiums. However, states may require an initial premium or enrollment fee to be paid prior to enrolling in coverage and/or pursue the collection of past-due premiums.
- In alignment with the SHO letter, “Provision of Medicaid and CHIP Services to Incarcerated Youth” released in July 2024 (for more information on the July 2024 SHO letter, see this expert perspective), states must maintain an incarcerated child or youth’s eligibility in CHIP (in either a suspended enrollment or suspended benefits status) if they otherwise remain eligible for CHIP at subsequent renewals conducted at the end of a child or youth’s CE period. States may only terminate CHIP coverage for children or youth who are incarcerated if they experience one of the exceptions to CE or are found ineligible for CHIP for a reason other than being incarcerated at a regular renewal when their CE period ends.
CMS updated its FAQs to reflect the policy clarifications above and incorporates new questions related to immigration status, post-enrollment verification, retroactive eligibility, renewal of other household members, Title IV-E eligible children and youth, and other topics.
[1] For example, if a child/youth starts their CHIP CE period in March and is transitioned to Medicaid in May of a given year, then the child/youth will continue to be enrolled in Medicaid until March if the state elects Option 1 or May if the state elects Option 2. Regardless of the option, the state would conduct a full eligibility review at the end of the child/youth’s CE period.