Health Law Daily Wrap Up, ADMINISTRATION OF MEDICARE/MEDICAID PROGRAMS—CMS LETTERS: CMS adds new stratification standards to FFY 2027 Core Sets, (May 15, 2026)

By Sherri M. Schroeder, J.D.

CMS is updating its Core Sets of Health Home Quality Measures for Medicaid by implementing the new mandatory standards of Foster Care and the Medicaid adult expansion group.

In a letter directed to State Medicaid Directors, CMS has announced its federal fiscal year (FFY) 2027 updates to the Social Security Act (the Act) Section 1945 and 1945A Core Sets of Health Home Quality Measures for Medicaid (the Health Home Core Sets). Although CMS did not select any measures for addition to or removal from the Health Home Core Sets for FFY 2027, the agency did update the Sets’ stratification standards by adding Foster Care and the Medicaid adult expansion group as mandatory stratification standards. The Health Home Core Sets will take effect for the FFY 2027 reporting cycle for Health Home programs implemented between July 1, 2025, and June 30, 2026. CMS plans to release updated technical specifications for the Sets in the spring of 2027 (CMS Letter to State Medicaid Directors, SMD: 26-002, May 5, 2026).

Stratification. All quality measures in the relevant Health Home Core Sets for FFY 2027 must be reported if a state or territory has a Health Home program under Section 1945 or 1945A of the Social Security Act. Additionally, 50 percent of the measures must be stratified in the third and fourth years of reporting according to 42 C.F.R. § 437.10(d)—and this is the fourth year. States will be required to report stratified data for the Health Home measures under the existing standards of race and ethnicity, sex, and geography, with Foster Care and the Medicaid adult expansion group added as mandatory stratification standards beginning with FFY 2027 reporting. CMS also notes that it will make these new stratification standards available for voluntary reporting in 2026 to allow states to prepare for 2027 mandatory reporting.

CMS defines the foster care population stratification standard as beneficiaries who were in foster care at any time during the measurement period, using enrollment data to determine foster care status. According to the letter, states should use enrollment data to identify that the beneficiary was either enrolled in Medicaid in the title IV-E foster care eligibility category or in another eligibility category and had a foster care indicator. Stratification requirements for foster care will apply to both the 1945 and 1945A Health Home Core Sets.

CMS defines the Medicaid adult expansion group stratification standard as beneficiaries enrolled in adult expansion (under section 1902(a)(10)(A)(i)(VIII) of the Act and in regulation at 42 C.F.R. § 435.119) in the state plan or through a section 1115 demonstration that provides eligibility for the entire adult group population. Stratification requirements for the Medicaid adult expansion group will apply only to the 1945 Health Home Core Set.

Measures subject to stratification. For FFY 2027 reporting, states will be required to report stratified data on 50 percent of the mandatory measures to the Quality Measure Reporting (QMR) system by December 31, 2027. Selected because “they cover the lifespan, from birth through adulthood, and reflect high priority areas for improvement in health care delivery and health outcomes,” the following are the specific measures for which states will be required to report stratified data for the FFY 2027 Health Home Core Sets, which reflect 50 percent of each of the Health Home Core Sets (although states may choose to report stratified date on additional quality measures):

• COL-HH: Colorectal Cancer Screening (1945)

• FUH-HH: Follow-up after Hospitalization for Mental Illness (1945)

• CBP-HH: Controlling High Blood Pressure (1945)

• FUA-HH: Follow-up after Emergency Department Visit for Substance Use (1945)

• FUM-HH: Follow-up after Emergency Department Visit for Mental Illness (1945)

• OUD-HH: Use of Pharmacotherapy for Opioid Use Disorder (1945)

• WVC-HH: Child and Adolescent Well-Care Visits (1945A)

• OEV-HH: Oral Evaluation, Dental Services (1945A)

• W30-HH: Well-Child Visits in the First 30 Months of Life (1945A)

Questions. States may submit questions or request technical assistance for reporting Health Hoe Core Sets by sending an email to MACQualityTA@cms.hhs.gov.

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