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Medicaid Referrals to the IV-D Agency

IM-14-01

Published: March 13, 2014
Information About:
State/Local Child Support Agencies
Topics:
Case Management, Medical Support
Types:
Policy, Information Memorandums (IM)

INFORMATION MEMORANDUM

IM-14-01

DATE: March 13, 2014

TO: State and Tribal Agencies Administering Child Support Enforcement Plans under Title IV-D of the Social Security Act and Other Interested Parties

SUBJECT: Medicaid Referrals to the IV-D Agency

RELATED REFERENCES: 45 CFR §155.405(a)(1) and (4) (Single streamlined application.); 45 CFR §155.302(a) and (b) (Options for conducting eligibility determinations.); 42 CFR §433.138(b) (Identifying liable third parties.); 145 (Assignment of rights to benefits – State plan requirements.), 146 (Rights assigned; assignment method), 147 (Cooperation in establishing paternity and in obtaining medical support and payments and in identifying and providing information to assist in pursuing third parties who may be liable to pay.) and 148 (Denial or termination of eligibility.)

BACKGROUND: Several states have requested guidance from the federal Office of Child Support Enforcement (OCSE) regarding Medicaid referrals resulting from the single streamlined application completed by applicants for medical insurance, through the Healthcare Marketplace.

Federal policy regarding Medicaid referrals to child support agencies has not changed, but Medicaid expansion and the Marketplace application process mean that child support programs in some states may receive more Medicaid referrals overall and in particular may receive more inappropriate referrals.  Referrals may be inappropriate because:

• the case referred does not actually include a custodial parent and child support-eligible child;
• the referral does not include sufficient information to identify a noncustodial parent; and/or
• domestic violence is present but the parent did not have appropriate opportunity to claim good cause.

Inappropriate Medicaid referrals are of concern for states because of potential customer service, cost effectiveness, and performance issues.

• Inappropriate referrals may result in open child support cases for individuals who are not responsible for child support payments and for which the child support program has no available remedies to establish and/or enforce an order for medical support.  This could result in the customer receiving automated communications from the child support agency, creating confusion for the customer, and wasting child support resources.

• The child support agency may not be able to close the case under existing case closure policy and regulations, even though the case is not appropriate or workable, and no remedies are available for the establishment or enforcement of a medical support order.

• Open but unworkable child support cases may reduce a state’s child support performance level.  The potential consequences of having in the child support caseload a significant number of unworkable Medicaid cases may include loss of federal financial incentives and/or assessment of penalties against the state’s Temporary Assistance to Needy Families (TANF) grant under Title IV-A of the Act.

• An applicant for Medicaid is afforded the opportunity to claim good cause when cooperation with child support could put him/her or other family members at risk of domestic violence.  If a parent has not had a meaningful opportunity to claim good cause or otherwise disclose concerns about domestic violence, pursuit of medical support may put them or their children in danger.

State child support and Medicaid agencies should work together to define referral criteria to ensure only appropriate Medicaid cases are referred to the child support agency.  This IM summarizes existing guidance and provides considerations for jurisdictions to mitigate the risks of inappropriate referrals. 

PREVIOUS GUIDANCE ON MEDICAL SUPPORT REFERRALS

Over the years, guidance has been provided with regard to child support and referrals from the Medicaid agencies.  The Affordable Care Act has changed the landscape in terms of the IV-D program’s involvement in the establishment and enforcement of medical support.  Some relevant references:

DCL-00-122, issued 12/22/2000: HCFA Letter to State Medicaid Directors. This letter provides an overview of assignment of rights and cooperation with the IV-D agency by applicants/recipients of Medicaid and CHIP.

IM-07-06, issued 9/6/2007: Appropriate Referrals, Requests for Location Services, Child Support Applications, and Electronic Interface between Child Welfare and Child Support Enforcement Agencies.  This IM addresses referrals between IV-E/IV-B and IV-D more broadly, but does provide important insight.  Under Case Closure (page 11): “IV-D case closure criteria should be considered not only in the development of case closure procedures but in the development of referral criteria.  Consequences to State child support enforcement agencies when inappropriate cases are referred could be loss of financial incentives and/or assessment of penalties against the title IV-A TANF grant.”

IM-08-03, issued 4/22/08: Guidance on Referral of Medicaid Cases to Title IV D Child Support Enforcement Agencies.  “Title XIX of the Act, and its implementing regulations or guidance, do not require state Medicaid agencies to refer Medicaid applicants or recipients to state IV-D agencies.  Therefore, a state Medicaid agency may determine which cases are appropriate to refer to state IV-D agencies.  State IV-D and Medicaid agencies should coordinate to determine criteria for referring appropriate cases and exchanging information by the most efficient and cost-effective means available (using manual or automated systems.)”

AT-08-08, issued 7/24/08: Published the Final Rule for Child Support Enforcement Program Medical Support.

AT-10-02, issued 6/7/2010: States Harmless from Penalties for Failure to Comply with Medical Support Final Rule State Plan Requirements.  “While health insurance reform legislation does not amend Title IV-D of the Social Security Act (the Act), it enacts policies that will substantially improve children’s health care coverage and establish parents’ shared responsibility for their children’s coverage.  As OCSE works to update medical support rules based on the health insurance reform legislation, state IV-D agencies will not be penalized if OCSE is unable to certify that the state IV-D agency is in compliance with federal medical support regulations….During this time, it is important that state IV-D agencies continue to provide medical child support enforcement services in compliance with all statutory requirements, including Sections 452(f) and 466(a)(19) of the Act.  All federal reporting requirements remain in effect although audits of medical support data are temporarily suspended.”

AT-10-10, issued 11/4/2010: State CSE Program Flexibility to Improve Interoperability with Medicaid and CHIP.  “State child support agencies …may: update medical support policies to enhance collaboration with Medicaid and CHIP to improve enrollment of eligible children. This includes the option to define medical support to include private health insurance as well as other health care coverage such as Medicaid, CHIP, and other state coverage plans, and cash medical support; and/or otherwise update medical support guidelines, including modifying the definition of “reasonable cost” as referenced in Section 452(f); and/or continue current and planned medical support policies and practices.”

In summary, there is no requirement for the state Medicaid agency to refer all Medicaid cases to the child support program.  However, once the child support agency has opened a corresponding child support case based on a Medicaid referral, the child support agency is bound by case closure regulations. (See 45 CFR §303.11and PIQ-03-09.)

HOW STATE CHILD SUPPORT AGENCIES CAN ADDRESS MEDICAID REFERRALS

There is an increased need for the child support agency to work with its Medicaid counterpart to ensure that Medicaid referrals to the child support agency are complete and appropriate.  While establishing or updating Medicaid referral policies, States should consider cost effectiveness, safety, and the desired child support outcomes for the family.  The following are some strategies that Medicaid and child support agencies may use.

• The state Medicaid and child support agencies may work together to define the Medicaid cases that would be appropriate for referral to the child support agency.  This may include considerations around the cost effectiveness of the referral, safety, and benefits to the state and the family as well as the present ability of the Medicaid agency to collect sufficient information about a noncustodial parent after they have determind eligibilty for Medicaid based on the information provided in the streamlined application.

• A state may develop a process (automated or manual) by which the child support agency does not accept inappropriate and incomplete Medicaid referrals – that is, these referrals should be returned to the Medicaid agency without the child support agency opening a corresponding case.  The child support agency should ensure that their statewide system is not automatically opening Medicaid-only cases without adequate information about the noncustodial parent. 

• A state may determine that the Medicaid agency will not make automatic referrals to the child support agency.  The Medicaid agency should be encouraged to refer or provide information about accessing child support services to families that are interested in or might benefit from child support services.

• If the child support agency will continue receiving Medicaid-only referrals, the child support agency should work with their Medicaid counterpart to establish the expectations, processes, and timeframes regarding the Medicaid agency gathering data required to make the referral a valid referral (e.g., identifying information for the noncustodial parent; good cause determination). [42 CFR §433.138(c)] 

INQUIRIES: ACF/OCSE Regional Program Managers, Division of Program Innovation, and/or Division of Policy and Training

Vicki Turetsky
Commissioner
Office of Child Support Enforcement