New Proposed Rule Seeks to Streamline Medicaid Managed Care Programs

November 2018 ~

Earlier this month, CMS released a new proposed rule that seeks to streamline the 2016 managed care regulatory framework for Medicaid and the Children’s Health Insurance Program (CHIP). The agency says the proposed changes aim to create more flexibility and target provisions that states and stakeholders said are costly and burdensome.

According to the press release, key revisions in the proposal include:

  • Providing states with greater flexibility to develop and certify a rate range under specific conditions and limitations, including that the rate range be actuarially sound;
  • Removing barriers that made it difficult to transition new services and populations into managed care because of existing fee-for-service payment arrangements by providing states with a three year transition period to come into compliance with requirements related to pass-through payments;
  • Providing states more flexibility to set meaningful network adequacy standards using quantitative standards that can take into account new service delivery models like telehealth;
  • Removing outdated and overly prescriptive administrative requirements that govern how plans communicate with beneficiaries to better align with standards used across federal programs and enable the use of modern means of electronic communication when appropriate.
  • Requiring CMS to hold itself accountable to issue guidance to help states move more quickly through the federal rate review process and to allow for submission of less documentation in certain circumstances while providing appropriate oversight to ensure patient protections and fiscal integrity;
  • Maintaining the requirement for states to develop a Quality Rating System (QRS) for health plans to facilitate beneficiary choice and promote transparency, but with greater ability for states to tailor an alternative QRS to their unique program while requiring a minimum set of mandatory measures to align with the Medicaid and CHIP Scorecard.
  • Maintaining the current regulatory framework for program and fiscal integrity, including provisions related to the actuarial soundness of rate setting, provider screening and enrollment standards, and medical loss ratio (MLR) standards;
  • Strengthening federal requirements to protect federal taxpayers from cost shifting by prohibiting states from retroactively adding or modifying risk-sharing mechanisms and ensuring that differences in reimbursement rates are not linked to enhanced federal match.

For more information, a summary of the proposed changes can be found here and the full text can be accessed on the Federal Register.



Source(s): CMS Fact Sheet; CMS Press Release; Federal Register; HealthPayerIntelligence; American Hospital Association; Becker’s Hospital Review;