CFR > Title 42 - Public Health > CHAPTER IV—CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES > SUBCHAPTER C—MEDICAL ASSISTANCE PROGRAMS (parts 430 to 456) > PART 433—STATE FISCAL ADMINISTRATION > SUBPART C—Mechanized Claims Processing and Information Retrieval Systems (§433.110 to §433.131) > 433.120—Procedures for reduction of FFP after reapproval review.

433.120—Procedures for reduction of FFP after reapproval review.

(a) If CMS determines after the reapproval review that the system no longer meets the conditions of reapproval in § 433.119, CMS will reduce FFP for system operations for at least four quarters. However, no system will be subject to reduction of FFP for at least the first four quarters after the quarter in which the system is initially approved as eligible for 75 percent FFP.
(b) CMS will reduce FFP in expenditures for system operations from 75 percent to no more than 70 percent and no less than 50 percent; however, CMS will not reduce FFP by more than 10 percentage points in any four-quarter period. The percentage to which the FFP is reduced will depend primarily on the following criteria:
(1) The number of conditions judged unsatisfactory;
(2) The extent to which conditions were not met;
(3) The significance of the unsatisfactory conditions in overall mechanized claims processing and information retrieval system operations; and
(4) The actual and potential program impact attributable to the unsatisfactory conditions.
[50 FR 30848, July 30, 1985, as amended at 54 FR 41974, Oct. 13, 1989]