This is a Historical Document.

INFORMATION MEMORANDUM

IM-2008-03

DATE: April 22, 2008

TO: STATE AND TRIBAL AGENCIES ADMINISTERING CHILD SUPPORT ENFORCEMENT PLANS UNDER TITLE IV-D OF THE SOCIAL SECURITY ACT (THE ACT), AND OTHER INTERESTED INDIVIDUALS

SUBJECT: Guidance on Referral of Medicaid cases to Title IV-D Child Support Enforcement Agencies.

BACKGROUND:A series of Medical Support meetings were held in 2005 and 2006 to improve coordination among State Child Support Enforcement (IV-D), Child Welfare (IV-E) and Medicaid/State Children’s Health Insurance Program (SCHIP) agencies. Separate guidance on IV-E/IV-D coordination has been issued http://www.acf.hhs.gov/programs/cse/pol/IM/2007/im-07-06.htm. During the meetings, an issue was raised regarding whether a State Medicaid agency is required to refer Medicaid cases to the IV-D agency and which Medicaid cases should be referred to IV-D agencies.

The Federal Office of Child Support Enforcement (OCSE) encourages State IV-D and Medicaid agencies to work together to define referral criteria to ensure only appropriate Medicaid cases are referred to the IV-D agency. In order to assist with such coordination, this document clarifies Federal policy on referral of Medicaid cases to IV-D agencies, describes possible categories of Medicaid cases that a State might determine are appropriate or inappropriate referrals to IV-D agencies, and addresses certain adverse consequences of referring all Medicaid cases to IV-D agencies for medical support services.

MEDICAID REFERRALS TO IV-D AGENCIES

Section 1912 of the Act requires that, as a condition of eligibility, all legally-able Medicaid applicants and recipients assign their rights, and the rights of any other eligible individual(s) on whose behalf they can make an assignment, to medical support and payment and, with the exception of those described below, cooperate in establishing paternity and in pursuing both medical support and payments from third parties.

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).

There are potentially serious consequences to State IV-D agencies when inappropriate Medicaid cases are referred to them. If a Medicaid recipient’s cooperation with the IV-D program is not required under title XIX of the Act, and the IV-D agency cannot proceed with the case without that cooperation, the IV-D agency may be unable to close the IV-D case because of strict IV-D case closure criteria. State IV-D agencies are only authorized under Federal regulations to close IV-D cases if a limited number of specified circumstances are met. The potential consequences of having in the IV-D caseload unworkable Medicaid cases include loss of financial incentives and/or assessment of penalties against the State’s Temporary Assistance to Needy Families grant under title IV-A of the Act. Section 458 of the Act awards to State IV-D programs each year a total of approximately $470 million in financial incentives available based on IV-D program performance. A State could incur a penalty of 1 and 5 percent of a State’s Federal TANF grant for failure to meet required IV-D program performance standards or if data used to compute performance indicators are incomplete or unreliable. Unworkable IV-D cases reduce a State’s performance level.

Appropriate Cases to Refer to the IV-D Agency Include:

• Cases in which the custodial parent and child(ren) are receiving Medicaid, the parent has assigned all his/her rights and those of the child(ren) to medical support to the State, and the parent is required to cooperate with the IV-D child support agency.

The Medicaid agency should refer appropriate cases and relevant information to the IV-D agency as soon as possible after a determination of Medicaid eligibility has been made.

Inappropriate Cases to Refer to the IV-D Agency

Title XIX of the Act exempts certain Medicaid recipients from the mandatory assignment of medical support rights and cooperation requirements in section 1912 of the Act. They include: ¹

• Pregnant women eligible under section 1902(l)(1)(A) of the Act (“poverty-level pregnant women”).
• Transitional Medicaid Assistance (TMA) recipients eligible under section 1925 of the Act.
• Cases where the custodial parent has shown “good cause” (as determined by the State in accordance with standards prescribed by the Secretary of Health and Human Services which take into consideration the best interest of the individuals involved) for why there should not be a referral, taking into consideration the best interests of the individuals involved, are exempt from cooperating in establishing paternity, pursuing medical support, and identifying and pursuing payments from third parties.
• A child-only Medicaid case in which the custodial parent is not receiving Medicaid and in which there is no assignment of medical support or requirement that the custodial parent cooperate with the child support program. A child is not required to cooperate, nor can a child’s eligibility for Medicaid be affected by an adult’s failure to cooperate.

Referral of these types of Medicaid cases to the IV-D agency should be considered inappropriate because, upon receipt, a IV-D agency must open a IV-D case in which there is no assignment of rights or requirement to cooperate with the IV-D agency to secure medical support for the child. Although certain Medicaid cases may be determined inappropriate to refer to the IV-D agency, caseworkers should consider informing these families of available IV-D child support services and providing them with information about applying for such services, if they so desire.

(Note: For State Children’s Health Insurance Program (SCHIP) cases under title XXI of the Act, the above Medicaid exceptions to mandatory assignment of medical support rights and cooperation with the IV-D agency only apply if a State has implemented SCHIP through its Medicaid program. If a State chooses to implement SCHIP through a separate child health program, the above provisions do not apply.

RELATED REFERENCES:

DCL-00-122: HCFA Letter to State Medicaid Directors http://www.acf.hhs.gov/programs/cse/pol/DCL/2000/dcl-00-122.htm

INQUIRIES: Regional Offices

Commissioner Margot Bean
Office of Child Support Enforcement

cc: ACF/OCSE Regional Program Managers