Opportunity Information: Apply for CMS 1Z0 10 003

  • The Centers for Medicare Medicaid Services in the health sector is offering a public funding opportunity titled "CHILDRENS HEALTH INSURANCE PROGRAM REAUTHORIZATION ACT (CHIPRA) PROSPECTIVE PAYMENT SYSTEM FOR FEDERALLY QUALIFIED HEALTH CENTERS AND RURAL HEALTH CLINICS TRANSITION GRANTS" and is now available to receive applicants.
  • Interested and eligible applicants and submit their applications by referencing the CFDA number(s): 93.767 Childrens Health Insurance Program.
  • This funding opportunity was created on Feb 22, 2010 and posted on Feb 22, 2010.
  • Applicants must submit their applications by Mar 25, 2010 All grant applications must be submitted electronically and are due on March 25, 2010. Applications received through http://www.grants.gov until 500 p.m. Eastern Standard time on March 25, 2010 will be considered on time.. (Agency may still review applications by suitable applicants for the remaining/unused allocated funding in 2026.)
  • The funding agency has allocated a total of $5,000,000.00 to eligible and selected applicants.
  • Each selected applicant is eligible to receive up to $500,000.00 in funding.
  • The number of recipients for this funding is limited to 20 candidate(s).
  • Eligible applicants include: Others (see text field entitled Additional Information on Eligibility for clarification).
  • This grant opportunity is open to any State that operates its State CHIP program separately or in combination with its Medicaid program. As defined under 45 CFR 74.2, State refers to any of the several States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, any territory or possession of the United States, or any agency or instrumentality of a State exclusive of local governments. The terms territory or possession refers to Guam, the United States Virgin Islands, American Samoa, Puerto Rico, and the Commonwealth of the Northern Mariana Islands.
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Opportunity Summary:

This grant opportunity, offered by the Centers for Medicare and Medicaid Services (CMS), was created to help states update how they pay Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) for services delivered to children covered under separate or combination Children s Health Insurance Program (CHIP) programs. The policy driver behind the funding is the Children s Health Insurance Program Reauthorization Act of 2009 (CHIPRA), which extended CHIP authorization through federal fiscal year 2013 and aimed to preserve and expand coverage for low income, uninsured children. In particular, Section 503 of CHIPRA requires state CHIP programs to follow payment requirements modeled on Section 1902(bb) of the Social Security Act, which established a prospective payment system (PPS) for FQHCs and RHCs in Medicaid starting in 2001. In practical terms, states running CHIP outside of Medicaid must move to paying these clinics through a PPS structure, or implement an alternative payment methodology as long as the affected FQHCs and RHCs agree to it.

The purpose of the grants is not to pay for ongoing clinical services, but to cover the transition work states need to do to comply with the PPS (or agreed alternative) payment requirement in their CHIP programs. CMS recognized that shifting payment methods can require significant administrative and technical changes, especially for states whose CHIP is not simply a Medicaid expansion. The announcement highlights several examples of eligible transition activities: modifying state financial systems so they can calculate and issue PPS based payments; establishing or updating auditing, reconciliation, and wraparound payment procedures; collecting and analyzing FQHC and RHC cost reports and related utilization data; hiring contractual support for data gathering and analytics; making state plan amendments; and renegotiating contracts with managed care plans to ensure payment arrangements align with the new PPS obligations. Overall, the grant is meant to help states build the operational infrastructure needed to pay FQHCs and RHCs correctly and consistently under CHIP rules.

Eligibility is limited to states (as defined in federal regulations) that operate a separate CHIP program or a combination program (part separate CHIP and part Medicaid expansion). The definition of "state" for this opportunity is broad and includes the 50 states, the District of Columbia, Puerto Rico, and U.S. territories and possessions such as Guam, the U.S. Virgin Islands, American Samoa, and the Commonwealth of the Northern Mariana Islands, as well as state agencies or instrumentalities (but not local governments). The funding instrument is a discretionary grant, categorized under health, and tied to CFDA 93.767 (Children s Health Insurance Program). There is no cost sharing or matching requirement listed, which means states were not required to contribute a set non-federal share to receive these grant funds.

In terms of funding size and scale, CMS set aside an estimated total of 5,000,000 for this initiative and anticipated making about 20 awards. Individual awards could range from a floor of 25,000 up to a ceiling of 500,000, giving CMS flexibility to support both smaller administrative updates and larger, more complex statewide payment system transitions. The opportunity was posted February 22, 2010, with applications required to be submitted electronically through Grants.gov by March 25, 2010 at 5:00 p.m. Eastern Time. The funding opportunity number was CMS-1Z0-10-003, and the program was later archived on April 24, 2010. For technical access issues related to the application package, applicants were directed to the Grants.gov Contact Center via phone or email during standard support hours.

Frequently Asked Questions (FAQs)

What is this grant opportunity?

This is a discretionary grant opportunity offered by the Centers for Medicare and Medicaid Services (CMS) to help states update how they pay Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) for services delivered to children covered under separate or combination Children's Health Insurance Program (CHIP) programs.

What is the main goal of the funding?

The funding is intended to support transition work so states can comply with CHIP payment requirements that mirror Medicaid's prospective payment system (PPS) approach for FQHCs and RHCs. It is focused on administrative and technical implementation rather than direct healthcare delivery.

What law or policy is driving this grant?

The policy driver is the Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA). The opportunity specifically references Section 503 of CHIPRA, which requires state CHIP programs to follow payment requirements modeled on Section 1902(bb) of the Social Security Act (the Medicaid PPS requirements for FQHCs and RHCs implemented starting in 2001).

Why is CMS funding this work?

CMS recognized that shifting payment methods can require major administrative and technical changes, particularly for states whose CHIP is not simply a Medicaid expansion. The grant supports the operational build-out needed for compliant, consistent payment to FQHCs and RHCs under CHIP.

Does this grant pay for ongoing clinical services?

No. The purpose of the grant is not to pay for ongoing clinical services. It is meant to cover transition activities and infrastructure changes needed to implement PPS (or an agreed alternative payment methodology) in CHIP.

What payment approach are states expected to implement for CHIP?

States operating CHIP outside of Medicaid are expected to move to a prospective payment system (PPS) structure for FQHCs and RHCs, or implement an alternative payment methodology as long as the affected FQHCs and RHCs agree to it.

Who is eligible to apply?

Eligibility is limited to states (as defined in federal regulations) that operate either (1) a separate CHIP program or (2) a combination program (part separate CHIP and part Medicaid expansion).

Which jurisdictions count as a "state" for this opportunity?

For this opportunity, the term "state" includes the 50 states, the District of Columbia, Puerto Rico, and U.S. territories and possessions such as Guam, the U.S. Virgin Islands, American Samoa, and the Commonwealth of the Northern Mariana Islands. State agencies or instrumentalities are included, but local governments are not.

What types of activities can the grant fund?

The announcement provides examples of eligible transition activities, including:

  • Modifying state financial systems so they can calculate and issue PPS-based payments
  • Establishing or updating auditing, reconciliation, and wraparound payment procedures
  • Collecting and analyzing FQHC and RHC cost reports and related utilization data
  • Hiring contractual support for data gathering and analytics
  • Making state plan amendments
  • Renegotiating contracts with managed care plans so payment arrangements align with PPS obligations

What is meant by "wraparound" payments in this context?

The opportunity mentions establishing or updating "wraparound payment procedures" as an eligible activity. In the context provided, this refers to procedures states use to ensure payment arrangements align with PPS obligations, including reconciliation and related administrative processes needed to pay FQHCs and RHCs correctly and consistently.

What is the funding instrument and category?

The funding instrument is a discretionary grant. It is categorized under health and is tied to CFDA 93.767 (Children's Health Insurance Program).

Is there a cost sharing or matching requirement?

No cost sharing or matching requirement is listed. Based on the information provided, states were not required to contribute a set non-federal share to receive these grant funds.

How much total funding was available under this initiative?

CMS set aside an estimated total of $5,000,000 for this initiative.

How many awards did CMS expect to make?

CMS anticipated making about 20 awards.

What was the expected award size per grantee?

Individual awards could range from $25,000 (minimum) to $500,000 (maximum), allowing CMS to support both smaller administrative updates and more complex statewide payment system transitions.

What is the funding opportunity number?

The funding opportunity number is CMS-1Z0-10-003.

When was the opportunity posted?

The opportunity was posted on February 22, 2010.

What was the application deadline?

Applications were required to be submitted electronically through Grants.gov by March 25, 2010 at 5:00 p.m. Eastern Time.

Where did applicants submit their applications?

Applications had to be submitted electronically through Grants.gov.

What if an applicant had technical problems accessing the application package?

For technical access issues related to the application package, applicants were directed to contact the Grants.gov Contact Center by phone or email during standard support hours.

What does it mean that the opportunity was "archived"?

The program was later archived on April 24, 2010, meaning it was no longer an active, open funding opportunity as of that date.

Which CHIP program types are the focus of this grant?

This grant focuses on states operating separate CHIP programs or combination CHIP programs (part separate CHIP and part Medicaid expansion), particularly where payment systems must be updated to meet PPS (or agreed alternative) requirements for FQHCs and RHCs.

What kinds of operational changes is CMS expecting states to make?

Based on the examples listed, CMS is expecting states to build or enhance the administrative and technical infrastructure needed to implement PPS-compliant payments, including financial system updates, auditing and reconciliation processes, data collection and analysis using cost reports and utilization data, and contract or state plan updates that align CHIP payment operations with the required methodology.

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