On June 1, CMS officially unveiled its plan to update the rules governing Medicaid Managed Care to improve its effectiveness. These much-anticipated rules will help will help align regulations for managed care plans with those of Medicare Advantage Plans and Qualified Health Plans, plans offered by federal and state marketplaces. The rules are intended to deliver a structured approach to delivery systems, enhance health outcomes and improve beneficiary experiences for the program which currently covers over 40 million individuals, approximately 70% of Medicaid enrollees.
With major changes in healthcare since the managed care rules were initially adopted 13 years ago, there was a need to align Medicaid managed care regulations to provide some consistency to states, plans, and government health programs. The regulations address these changes and propose the implementation of medical loss ratios, fiscal and program integrity, and beneficiary protections as well as other provisions to increase measures in managing care coordination and promote quality of care using analytic data.
In the coming weeks, Sellers Dorsey will continue to analyze the proposed rule and its impact on states, hospitals and health systems, health plans, and long term services and supports providers among others to offer our clients insight into the challenges and opportunities of the regulations. After an initial review of the regulations, we have highlighted some of the proposed changes:
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Beneficiary Protections
• Align enrollment practices between Medicaid managed care, Medicaid fee-for-service and marketplace coverage through Qualified Health Plans (QHPs).
• Reduce coordination issues for beneficiaries with chronic and complex conditions.
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Appeals and Grievances
• Reduce the timeframe of standard appeal decisions from 45 days to 30 for Managed Care Organizations and Prepaid Inpatient Health Plans.
• Shorten expedited appeals from 3 working days to 72 hours to align with Medicaid Advantage plans.
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Medical Loss Ratio (MLR)
• Implement an 85% MLR standard to ensure Medicaid funds are being used properly
Managed Long Term Services and Supports (MLTSS)
• Align Medicaid managed care rules with the principles of MLTSS programs, issued to states in 2013. This includes stakeholder engagement, person-centered processes, and enhanced provision of home and community based care (HCBS).
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Fiscal and Program Integrity
• Re-designate existing standards for incentive arrangements so they are time-limited, not subject to automatic renewal, and not conditioned on intergovernmental transfer (IGT) agreements.
• Limit incentive arrangements to 5% of the certified capitation rate.
• Enact strong processes for fraud prevention activities, as well as put in place robust processes for the detection, referral and recovery of improper payments, including potential fraud, waste and abuse.
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Provider Network Adequacy
• Align network adequacy standards more closely with those of Medicaid Advantage and QHPs.
• Authorize states not the federal government to set standards for network adequacy.
• Require Managed Care Plans to provide accurate information on their website in regards to provider directories and drug formularies.
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Alignment of CHIP rules
• Where applicable, align CHIP managed care standards with those of the Marketplace and Medicaid.
• Align CHIP managed care regulations with some of the proposed revisions to the Medicaid managed care rules in an effort to improve health care outcomes and improve the beneficiary experience.
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The deadline to submit comments on the rules is July 27. We welcome the opportunity to speak to you regarding your concerns or questions regarding the new Medicaid Managed Care rules. Please do not hesitate to contact us at info@sellersdorsey.com.
To view the new rules click here.
To view the Centers for Medicare and Medicaid Services (CMS) fact sheet, click here.
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