Approach A. Leveraging Medicaid Match

Module 1	Introduction	Unit 1 IIS Sustainability Toolkit Introduction
Module 2	Getting Started	Unit 1 How to Use this Toolkit
Module 3	Defining IIS Sustainability	Unit 1 What is IIS Sustainability and Why Does it Matter?
Module 4	Strategy 1: Diversifying Funding	Unit 1 Diversifying Funding Introduction	Unit 2 Approach A. Leveraging Medicaid Match	Unit 3 Approach B. Billing for IIS Data
Module 5	Strategy 2: Optimizing IIS Efficiency	Unit 1 Optimizing IIS Efficiency Introduction	Unit 2 Approach A. Increasing the Use of Shared Services	Unit 3 Approach B: Leveraging Shared Infrastructure	Unit 4 Approach C: Using Open Source Software	Unit 5 Approach D. Implementing Process Automation	Unit 6 Approach E: Modernizing IIS
Module 6	Success Stories from the Field	Unit 1 Success Stories Introduction	Unit 2 Using Medicaid Match to Diversify IIS Funding	Unit 3 Diversifying IIS Funding Through Health Plan Billing	Unit 4 Slowing the Curve to Manage Rising IIS Costs
Module 7	Additional Considerations	Unit 1 Additional Considerations
Module 8	Additional Resources Related to Sustainability	Unit 1 Additional Resources
Module 9	References	Unit 1 References
Module 10	Abbreviations and Acronyms	Unit 1 Abbreviations and Acronyms

What is a Medicaid match?

Medicaid match, also known as Federal Financial Participation (FFP), is a funding mechanism from the Centers for Medicare & Medicaid Services (CMS) that helps states cover the costs of activities and systems serving Medicaid beneficiaries. As described in a 2024 presentation in an American Immunization Registry Association (AIRA) webinar, enhanced federal matching rates are available to IIS under the current Medicaid Enterprise System (MES) framework. One key to successfully applying for a Medicaid match is having a strong, collaborative relationship between the immunization and Medicaid programs (see Success Stories from the Field: Using Medicaid Match to Diversify IIS Funding). Partnering closely with the state Medicaid program is essential to developing a successful application. This application, which will be called an Advanced Planning Document (APD), will require:

Providing extensive information about your IIS, which you may be able to pull from fact sheets, CDC funding requests, or other documents you have already prepared;
Proposing IIS activities that align with Medicaid’s strategic goals for improving health information exchange to enable healthcare providers to improve the quality and efficiency of care delivery;
Meeting Medicaid system certification (may qualify under the umbrella of a state Health Information Exchange);
Calculating a fair cost allocation based on Medicaid-associated expenses to the IIS;
Securing a nonfederal (state or local funding) match to Medicaid funding, with the amount to be determined by match rate tier (see below), amount of funds requested, and fair cost allocation;
Possibly establishing an inter-agency agreement for transferring funds (especially if the IIS is in a separate agency from the state Medicaid program);
Planning appropriately for receiving Medicaid funding on a reimbursement basis—it will not be a grant or cooperative agreement that provides funding up front;
Reporting to the state Medicaid program regularly on agreed-upon outcomes and metrics (can be based on data the IIS is already regularly producing);
Applying to the state Medicaid program every federal fiscal year and adhering to the timing of the Medicaid program’s funding cycle and the jurisdiction’s budget approval process.

Are you planning a Medicaid match funding application?

Use this worksheet to track planning tips or ideas. These may be good ideas and questions to discuss with your Immunization Program Manager and other relevant persons in the organization.

Medicaid match provides different tiers of funding based on proposed activities:

90/10 Match: A 90% federal/10% state match is available for the design, development, and installation (DDI) of the IIS. Development and implementation of a master patient index tool, enhanced interoperability tools, and other technical functionality that can serve the Medicaid population is also eligible. Note that Medicaid match can be achieved by both the IIS and a Health Information Exchange (HIE), as they are not mutually exclusive.

75/25 Match: A 75% federal/25% state match is available for the ongoing operations and maintenance of the IIS. To receive this enhanced rate, the IIS must meet the requirements of Medicaid’s Streamlined Modular Certification (SMC) process. Working closely with a Medicaid partner in your jurisdiction will facilitate the certification process. Aligning the IIS with CDC’s IIS functional standards will support meeting Medicaid’s certification. It may also be possible to meet Medicaid certification for the IIS by partnering with the electronic health information exchange (HIE) in your jurisdiction. One state met Medicaid certification for its IIS by being included under the umbrella of its state HIE’s certification.

50/50 Match: A 50% federal/50% state match is available for IIS administrative activities.

Calculating a Fair Cost Allocation

To receive Medicaid match funding, jurisdictions must demonstrate that the federal and state funds requested are proportional to the benefit the IIS provides to Medicaid beneficiaries. This process, known as fair cost allocation, is used to determine what portion of IIS costs can reasonably be attributed to supporting Medicaid populations and activities. See an example and access a template that can be used to calculate your own cost allocation. Note that a cost allocation based on serving the entire Medicaid population (i.e., all ages) may result in a lower Medicaid match than one serving children because a higher percentage of the childhood population is typically covered by Medicaid than that of the adult population.

How could Medicaid match be used to diversify IIS funding?

Medicaid match offers a significant opportunity to diversify the IIS funding base by obtaining federal dollars for the portion of the IIS that serves Medicaid-enrolled providers and members. States can utilize Medicaid matching funds to cover various categories of IIS needs, such as:

Technology and Infrastructure: system implementation, vendor operational costs, ongoing subscriptions, website maintenance, and cloud-based hosting.
Workforce and Operations: essential personnel, including IIS managers, data quality coordinators, technology staff, and IT project managers.
Enhancements and Special Projects: configuration enhancements, interoperability improvements, system upgrades, and support of features such as patient reminders and consumer access portals.

As mentioned earlier, applying for a Medicaid match requires aligning the IIS with Medicaid’s strategic goals. Because the Medicaid program and the IIS share the same goals for expanding health information exchange and increasing on-time, complete immunizations to reduce vaccine-preventable diseases and lower health care costs, the opportunity for goal alignment is clear. The following activities were included in one state’s successful application:

Identify immunization gaps in Medicaid populations using IIS data and functionality;
Provide Medicaid-enrolled healthcare providers with access to consolidated, real-time patient immunization records and clinical decision support to inform patient immunization needs and save costs by avoiding unnecessary vaccine doses administered;
Issue patient reminders or recalls for immunizations due or overdue;
Produce immunization rate quality measures by Medicaid-enrolled provider and specific member populations (i.e., children and adolescents);
Offer consumers access to their immunization records;
Enable Vaccines for Children (VFC) program business processes, accountability, and vaccine distribution to Medicaid-enrolled providers.

These activities demonstrate the critical value of the IIS to the state’s healthcare infrastructure. This strong partnership between public health and Medicaid can ensure that the IIS remains a priority for sustainable, long-term state and federal investment.

Check out this tip sheet with recommendations and lessons learned from your peers that are specific to working with state Medicaid programs on Medicaid matching funds.

How can use of Medicaid match promote IIS sustainability?

Medicaid match promotes sustainability primarily because Medicaid Enterprise System (MES) funding has no end date. Once an IIS goes through the Certification Review and demonstrates it is achieving approved outcomes, the state can continually request a 90%/10% match rate for technical enhancements and other system add-ons or a 75%/25% match rate for ongoing system operations. They may also continually request the 50% administrative match rate. In all cases, ongoing justification that IIS services fit within the activities associated with each match rate, and continue to serve Medicaid providers and members, is necessary. While states must reapply for Medicaid matching funds each federal fiscal year, experience has shown that states have been approved for continued matching funding for many years after their first successful application. Note that the amount of a Medicaid match can represent a large proportion of total IIS costs, while it is a very small portion of a state Medicaid program’s total budget and can be considered a worthwhile investment of state and federal resources.

Securing a continuous funding stream, such as Medicaid match, can be critical for IIS sustainability due to the escalating costs of upgrading and maintaining modern technology. For example, as an IIS transitions from hosting in a server environment to a cloud hosting environment, annual hosting costs can rise significantly. Medicaid match helps augment the funding available to cover these operational costs to the immunization program.

Need help communicating the value of your IIS in terms of broad CMS and state Medicaid goals for health system transformation and improved health outcomes? Click here for relevant communication tips.

Additional resources related to Medicaid match