The Division of Cost Allocation (DCA) within the Program Support Center (PSC) approves states’ CAPs.
PSC is a sister agency to the Centers of Medicare and Medicaid Services (CMS) within Health and Human Services (HHS). The State Medicaid Agency submits its CAP directly to DCA. Because PASRR is a Medicaid activity, DCA asks CMS to provide comments during the approval process. DCA and the state eventually come to an agreement over the terms of the CAP at which point DCA either approves or disapproves the CAP. CMS is a very active participant during this process since those at DCA are not experts on Medicaid policy.