CMS final rules to boost Medicaid, CHIP access and payment: 11 things to know

CMS has published two final rules designed to expand access in the Medicaid fee-for-service and managed care programs. 

The rules align requirements in the Children's Health Insurance Program with the Medicaid program and cement various changes to state directed payments, including codifying state flexibility for directed payments to match the average commercial rate, according to the American Hospital Association. 

The AHA commended CMS for recognizing the key role hospitals play in state Medicaid financing and the importance of supplemental payments to sustain beneficiary access to care amid low Medicaid base payment rates, including rates paid through commercial payers. 

"We applaud CMS' recognition that hospitals treat all patients the same — regardless of coverage — by formally adopting the average commercial rate as the upper payment limit as advocated by the AHA," Ashley Thompson, senior vice president for public policy analysis and development, said. "Codifying this provision ensures that hospitals have appropriate resources to serve Medicaid patients and strengthen America's safety-net. The AHA also appreciates CMS' efforts to streamline the approval of certain existing arrangements, which will cut down on bureaucracy and burden and allow hospitals to focus on their patients."

Eleven things to know about the final rules:

Ensuring access to Medicaid services final rule 

1. The final rule addresses key areas of access across both Medicaid fee for service and managed care delivery systems, including for home- and community-based services. 

2. The rule is designed to increase transparency and accountability, standardize data and monitoring, and create opportunities for states to promote active beneficiary engagement in their Medicaid programs to improve holistic access to care. 

3. The rule renames and expands the scope of states' Medical Care Advisory Committees. The renamed Medicaid Advisory Committees will advise states on an expanded range of issues.

4. Under the rule, states are required to compare their FFS payment rates for primary, obstetrical and gynecological care, and outpatient mental health and substance use disorder services to Medicare rates, and publish analyses every two years. 

5. States are also required to publish the average hourly rate paid for personal care, home health aide, homemaker and habilitation services, and publish the disclosure every two years.

Click here for more details on this rule.

Medicaid and CHIP managed care access, finance and quality final rule

6. The final rule establishes maximum appointment wait time standards for primary, obstetrical and gynecological care, and outpatient mental health and substance use disorder services. 

7. States must use an independent entity to conduct yearly secret shopper surveys to validate managed care plans' compliance with appointment wait time standards and the accuracy of provider directories to identify errors and providers that do not offer appointments. States must also conduct an annual enrollee experience survey for each managed care plan. 

8. The rule removes regulatory barriers to facilitate state-directed payments for value-based purchasing payment arrangements and to include non-network providers in state-directed payments. It also eliminates written prior approval for state-directed payments that are minimum fee schedules set at the Medicare payment rate.

9. Under the rule, provider pay rates for state-directed payments for hospital, nursing facility and professional services at an academic medical center cannot exceed the average commercial rate.

10. Medicaid managed care plans will be required to submit actual expenditures and revenues for state-directed payments as part of their medical loss ratio reports to states. The rule also requires states to provide medical loss ratios for each managed care plan. 

11. The final rule specifies that in lieu of services can be used as immediate or longer-term substitutes for a covered service or setting under the state plan, or when they can be expected to reduce or prevent the future need for such service or setting to better support health-related social needs .

Click here for more details on this rule.

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