---
kind: "section"
citation: "42 U.S.C. § 1396w"
title: "42"
title_heading: "The Public Health and Welfare"
number: "1396w"
heading: "Asset verification through access to information held by financial institutions"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/1396w"
units:
  - "Chapter 7 — Social Security"
  - "Subchapter XIX — Grants to States for Medical Assistance Programs"
---

# §1396w. Asset verification through access to information held by financial institutions

- (a) **Implementation—**
  - (1) **In general—** Subject to the provisions of this section, each [State](/usc/42/619.md?p=5) shall implement an asset verification program described in [subsection (b)](#b), for purposes of determining or redetermining the eligibility of an individual for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan under this subchapter.
  - (2) **Plan submittal—** In order to meet the requirement of [paragraph (1)](#a-1), each [State](/usc/42/619.md?p=5) shall—
    - (A) submit not later than a deadline specified by the [Secretary](/usc/42/1301.md?p=a-6) consistent with [paragraph (3)](#a-3), a [State](/usc/42/619.md?p=5) plan amendment under this subchapter that describes how the [State](/usc/42/619.md?p=5) intends to implement the asset verification program; and
    - (B) provide for implementation of such program for eligibility determinations and redeterminations made on or after 6 months after the deadline established for submittal of such plan amendment.
  - (3) **Phase-in—**
    - (A) **In general—**
      - (i) **Implementation in current asset verification demo States—** The [Secretary](/usc/42/1301.md?p=a-6) shall require those [States](/usc/42/619.md?p=5) specified in [subparagraph (C)](#a-3-C) (to which an asset verification program has been applied before June 30, 2008) to implement an asset verification program under this subsection by the end of [fiscal year](/usc/42/619.md?p=3) 2009.
      - (ii) **Implementation in other States—** The [Secretary](/usc/42/1301.md?p=a-6) shall require other [States](/usc/42/619.md?p=5) to submit and implement an asset verification program under this subsection in such manner as is designed to result in the application of such programs, in the aggregate for all such other [States](/usc/42/619.md?p=5), to enrollment of approximately, but not less than, the following percentage of enrollees, in the aggregate for all such other [States](/usc/42/619.md?p=5), by the end of the [fiscal year](/usc/42/619.md?p=3) involved:
        - (I) 12.5 percent by the end of [fiscal year](/usc/42/619.md?p=3) 2009.
        - (II) 25 percent by the end of [fiscal year](/usc/42/619.md?p=3) 2010.
        - (III) 50 percent by the end of [fiscal year](/usc/42/619.md?p=3) 2011.
        - (IV) 75 percent by the end of [fiscal year](/usc/42/619.md?p=3) 2012.
        - (V) 100 percent by the end of [fiscal year](/usc/42/619.md?p=3) 2013.
      - (iii) **Implementation in Puerto Rico—** The [Secretary](/usc/42/1301.md?p=a-6) shall require Puerto Rico to implement an asset verification program under this subsection by January 1, 2026.
    - (B) **Consideration—** In selecting [States](/usc/42/619.md?p=5) under [subparagraph (A)(ii)](#a-3-A-ii), the [Secretary](/usc/42/1301.md?p=a-6) shall consult with the [States](/usc/42/619.md?p=5) involved and take into account the feasibility of implementing asset verification programs in each such [State](/usc/42/619.md?p=5).
    - (C) **States specified—** The [States](/usc/42/619.md?p=5) specified in this subparagraph are California, New York, and New Jersey.
    - (D) **Construction—** Nothing in [subparagraph (A)(ii)](#a-3-A-ii) shall be construed as preventing a [State](/usc/42/619.md?p=5) from requesting, and the [Secretary](/usc/42/1301.md?p=a-6) from approving, the implementation of an asset verification program in advance of the deadline otherwise established under such subparagraph.
  - (4) **Exemption of certain territories—** This section shall only apply to the 50 [States](/usc/42/619.md?p=5), the District of Columbia, and Puerto Rico.
- (b) **Asset verification program—**
  - (1) **In general—** For purposes of this section, an asset verification program means a program described in [paragraph (2)](#b-2) under which a [State](/usc/42/619.md?p=5)—
    - (A) requires each applicant for, or recipient of, [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan under this subchapter on the basis of being aged, blind, or disabled to provide authorization by such applicant or recipient (and any other [person](/usc/42/1301.md?p=a-3) whose resources are required by law to be disclosed to determine the eligibility of the applicant or recipient for such assistance) for the [State](/usc/42/619.md?p=5) to obtain (subject to the cost reimbursement requirements of section 1115(a) of the Right to Financial Privacy Act[^1] [[12 U.S.C. 3415](/usc/12/3415.md)] but at no cost to the applicant or recipient) from any financial institution (within the meaning of [section 1101(1)](/usc/42/1101.md) of such Act [[12 U.S.C. 3401(1)](/usc/12/3401.md?p=1)]) any financial record (within the meaning of [section 1101(2)](/usc/42/1101.md) of such Act) held by the institution with respect to the applicant or recipient (and such other [person](/usc/42/1301.md?p=a-3), as applicable), whenever the [State](/usc/42/619.md?p=5) determines the record is needed in connection with a determination with respect to such eligibility for (or the amount or extent of) such [medical assistance](/usc/42/1396d.md?p=a); and
    - (B) uses the authorization provided under [subparagraph (A)](#b-1-A) to verify the financial resources of such applicant or recipient (and such other [person](/usc/42/1301.md?p=a-3), as applicable), in order to determine or redetermine the eligibility of such applicant or recipient for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan.
  - (2) **Program described—** A program described in this paragraph is a program for verifying individual assets in a manner consistent with the approach used by the Commissioner of [Social](/usc/42/1397j.md?p=20) Security under [section 1383(e)(1)(B)(ii) of this title](/usc/42/1383.md?p=e-1-B-ii).
- (c) **Duration of authorization—** Notwithstanding [section 1104(a)(1)](/usc/42/1104.md) of the Right to Financial Privacy Act[^1] [[12 U.S.C. 3404(a)(1)](/usc/12/3404.md?p=a-1)], an authorization provided to a [State](/usc/42/619.md?p=5) under [subsection (b)(1)](#b-1) shall remain effective until the earliest of—
  - (1) the rendering of a final adverse decision on the applicant’s application for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5)’s plan under this subchapter;
  - (2) the cessation of the recipient’s eligibility for such [medical assistance](/usc/42/1396d.md?p=a); or
  - (3) the express revocation by the applicant or recipient (or such other [person](/usc/42/1301.md?p=a-3) described in [subsection (b)(1)](#b-1), as applicable) of the authorization, in a written notification to the [State](/usc/42/619.md?p=5).
- (d) **Treatment of Right to Financial Privacy Act requirements—**
  - (1) An authorization obtained by the [State](/usc/42/619.md?p=5) under [subsection (b)(1)](#b-1) shall be considered to meet the requirements of the Right to Financial Privacy Act[^1] for purposes of [section 1103(a)](/usc/42/1103.md?p=a) of such Act [[12 U.S.C. 3403(a)](/usc/12/3403.md?p=a)], and need not be furnished to the financial institution, notwithstanding [section 1104(a)](/usc/42/1104.md?p=a) of such Act [[12 U.S.C. 3404(a)](/usc/12/3404.md?p=a)].
  - (2) The certification requirements of [section 1103(b)](/usc/42/1103.md?p=b) of the Right to Financial Privacy Act[^1] [[12 U.S.C. 3403(b)](/usc/12/3403.md?p=b)] shall not apply to requests by the [State](/usc/42/619.md?p=5) pursuant to an authorization provided under [subsection (b)(1)](#b-1).
  - (3) A request by the [State](/usc/42/619.md?p=5) pursuant to an authorization provided under [subsection (b)(1)](#b-1) is deemed to meet the requirements of [section 1104(a)(3)](/usc/42/1104.md) of the Right to Financial Privacy Act[^1] [[12 U.S.C. 3404(a)(3)](/usc/12/3404.md?p=a-3)] and of [section 1102](/usc/42/1102.md) of such Act [[12 U.S.C. 3402](/usc/12/3402.md)], relating to a reasonable description of financial records.
- (e) **Required disclosure—** The [State](/usc/42/619.md?p=5) shall inform any [person](/usc/42/1301.md?p=a-3) who provides authorization pursuant to [subsection (b)(1)(A)](#b-1-A) of the duration and scope of the authorization.
- (f) **Refusal or revocation of authorization—** If an applicant for, or recipient of, [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan under this subchapter (or such other [person](/usc/42/1301.md?p=a-3) described in [subsection (b)(1)](#b-1), as applicable) refuses to provide, or revokes, any authorization made by the applicant or recipient (or such other [person](/usc/42/1301.md?p=a-3), as applicable) under [subsection (b)(1)(A)](#b-1-A) for the [State](/usc/42/619.md?p=5) to obtain from any financial institution any financial record, the [State](/usc/42/619.md?p=5) may, on that basis, determine that the applicant or recipient is ineligible for [medical assistance](/usc/42/1396d.md?p=a).
- (g) **Use of contractor—** For purposes of implementing an asset verification program under this section, a [State](/usc/42/619.md?p=5) may select and enter into a contract with a public or private entity meeting such criteria and qualifications as the [State](/usc/42/619.md?p=5) determines appropriate, consistent with requirements in regulations relating to general contracting provisions and with [section 1396b(i)(2) of this title](/usc/42/1396b.md?p=i-2). In carrying out activities under such contract, such an entity shall be subject to the same requirements and limitations on use and disclosure of information as would apply if the [State](/usc/42/619.md?p=5) were to carry out such activities directly.
- (h) **Technical assistance—** The [Secretary](/usc/42/1301.md?p=a-6) shall provide [States](/usc/42/619.md?p=5) with technical assistance to aid in implementation of an asset verification program under this section.
- (i) **Reports—** A [State](/usc/42/619.md?p=5) implementing an asset verification program under this section shall furnish to the [Secretary](/usc/42/1301.md?p=a-6) such reports concerning the program, at such times, in such format, and containing such information as the [Secretary](/usc/42/1301.md?p=a-6) determines appropriate.
- (j) **Treatment of program expenses—** Notwithstanding any other provision of law, reasonable expenses of [States](/usc/42/619.md?p=5) in carrying out the program under this section shall be treated, for purposes of [section 1396b(a) of this title](/usc/42/1396b.md?p=a), in the same manner as [State](/usc/42/619.md?p=5) expenditures specified in [paragraph (7)](/usc/42/1396b.md?p=a-7) of such section.
- (k) **Reduction in FMAP after 2020 for non-compliant States—**
  - (1) **In general—** With respect to a calendar quarter, the [Federal medical assistance percentage](/usc/42/1396d.md?p=b) otherwise determined under [section 1396d(b) of this title](/usc/42/1396d.md?p=b) for—
    - (A) a non-compliant [State](/usc/42/619.md?p=5) that is one of the 50 [States](/usc/42/619.md?p=5) or the District of Columbia shall be reduced—
      - (i) for calendar quarters in 2021 and 2022, by 0.12 percentage points;
      - (ii) for calendar quarters in 2023, by 0.25 percentage points;
      - (iii) for calendar quarters in 2024, by 0.35 percentage points; and
      - (iv) for calendar quarters in 2025 and each year thereafter, by 0.5 percentage points; and
    - (B) a non-compliant [State](/usc/42/619.md?p=5) that is Puerto Rico shall be reduced—
      - (i) for calendar quarters in [fiscal year](/usc/42/619.md?p=3) 2026 beginning on or after January 1, 2026, by 0.12 percentage points;
      - (ii) for calendar quarters in [fiscal year](/usc/42/619.md?p=3) 2027, by 0.25 percentage points;
      - (iii) for calendar quarters in [fiscal year](/usc/42/619.md?p=3) 2028, by 0.35 percentage points; and
      - (iv) for calendar quarters in [fiscal year](/usc/42/619.md?p=3) 2029 and each [fiscal year](/usc/42/619.md?p=3) thereafter, by 0.5 percentage points.
  - (2) **Non-compliant State defined—** For purposes of this subsection, the term “non-compliant [State](/usc/42/619.md?p=5)” means a [State](/usc/42/619.md?p=5)—
    - (A) that is one of the 50 [States](/usc/42/619.md?p=5), the District of Columbia, or Puerto Rico;
    - (B) with respect to which the [Secretary](/usc/42/1301.md?p=a-6) has not approved a [State](/usc/42/619.md?p=5) plan amendment submitted under [subsection (a)(2)](#a-2); and
    - (C) that is not operating, on an ongoing basis, an asset verification program in accordance with this section.

## Footnotes

[^1]: See References in Text note below.

## Source credit

(Aug. 14, 1935, ch. 531, title XIX, § 1940, as added Pub. L. 110–252, title VII, § 7001(d)(1), June 30, 2008, 122 Stat. 2391; amended Pub. L. 116–3, § 4, Jan. 24, 2019, 133 Stat. 7; Pub. L. 117–328, div. FF, title V, § 5101(c), Dec. 29, 2022, 136 Stat. 5935.)

## Notes

### Editorial Notes

### References in Text

The Right to Financial Privacy Act, referred to in subsecs. (b) to (d), probably means the Right to Financial Privacy Act of 1978, title XI of Pub. L. 95–630, Nov. 10, 1978, 92 Stat. 3697, which is classified generally to chapter 35 (§ 3401 et seq.) of Title 12, Banks and Banking. For complete classification of this Act to the Code, see Short Title note set out under section 3401 of Title 12 and Tables.

### Amendments

2022—Subsec. (a)(3)(A)(iii). Pub. L. 117–328, § 5101(c)(1)(A), added cl. (iii).

Subsec. (a)(4). Pub. L. 117–328, § 5101(c)(1)(B), substituted “Exemption of certain territories” for “Exemption of territories” in heading and “, the District of Columbia, and Puerto Rico” for “and the District of Columbia” in text.

Subsec. (k)(1). Pub. L. 117–328, § 5101(c)(2)(A), in introductory provisions, struck out “beginning on or after January 1, 2021” after “With respect to a calendar quarter”; substituted “for—” and subpar. (A) for “for a non-compliant State shall be reduced—”; redesignated former subpars. (A) to (D) as cls. (i) to (iv), respectively, of subpar. (A) and realigned margins; and added subpar. (B).

Subsec. (k)(2)(A). Pub. L. 117–328, § 5101(c)(2)(B), substituted “, the District of Columbia, or Puerto Rico” for “or the District of Columbia”.

2019—Subsec. (k). Pub. L. 116–3 added subsec. (k).