Funding the Future: Using APDs to Accelerate Medicaid Modernization

Medicaid is one of the most significant healthcare programs in the United States, covering more than 90 million people. It plays a crucial role in providing care to children, low-income families, individuals with disabilities, and the elderly. But behind the scenes, many Medicaid systems are struggling under the weight of outdated technology and fragmented processes.

When most people hear “Advanced Planning Document (APD),” they think of compliance paperwork. But APDs are far more than that. They are one of the most powerful and underutilized funding mechanisms available to states.

APDs allow states to formally request federal financial participation from the Centers for Medicare & Medicaid Services (CMS) to support Medicaid Enterprise Systems (MES) modernization. With the right strategy, they can:

• Unlock enhanced federal funding: CMS may cover up to 90% of costs for system design, development and implementation.

• Support modular systems: Instead of replacing an entire MES at once, APDs can fund modular upgrades that are flexible, interoperable, and easier to maintain.

• Fuel innovation: APDs can cover advanced technologies like cloud infrastructure, predictive analytics and care coordination platforms.

• Align state and federal priorities: States can build modernization efforts that fit seamlessly with CMS’s goals of interoperability, accountability and equity.

In short, APDs are not just about funding technology they are about funding transformation.