What is a Section 1115 waiver and how does it affect Medicaid policy experimentation?

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Section 1115 waivers are demonstration authorities that let states pilot Medicaid innovations under federal rules, with approval from CMS. They give states flexibility to design the program in new ways—altering eligibility, expanding or narrowing covered benefits, changing cost-sharing, or trying new delivery systems and payment methods—so long as the proposals fit within federal guidelines and are approved (often with budget neutrality). They are temporary and state-specific, not nationwide, and they do not apply to private insurance. This structure supports policy experimentation by enabling careful testing of new Medicaid designs while the federal government monitors outcomes and can approve, adjust, or terminate the demonstration based on results.