The Q&As specify that the following are not MOE violations for Medicaid and CHIP: (1) automatic premium increases explicitly specified in a State plan or demonstration as of July 1, 2008 (Medicaid) and March 23, 2010 (CHIP); (2) the adoption (through State plan or demonstration amendments) of certain inflation-related adjustments to premiums in effect as of July 1, 2008 (Medicaid) or March 23, 2010 (CHIP); and (3) the adoption of premiums for new coverage groups, as long as the new coverage and premium amounts are consistent with other provisions of law.

The agency’s interpretation with respect to premiums differs from prior CMS guidance relating to the MOE provisions under the Recovery Act, in which CMS indicated that premium increases or imposition of new premiums was inconsistent with the Recovery Act’s MOE provisions. In the Q&As, the agency states that premium increases are still generally prohibited under the Recovery Act, although the Recovery Act’s MOE provisions will expire on June 30, 2011.