CMS issues final rule for Medicaid, CHIP managed care plans

The Centers for Medicare & Medicaid Services this afternoon issued its long awaited final rule on Medicaid managed care; the first major update in more than a decade. The final rule tracks closely to the proposed rule and would provide new standards for managed care provider networks, quality measures, external quality review, and beneficiary rights and protections. In addition, the final rule imposes new requirements for medical loss ratios for managed care plans, implements best practices identified in existing managed long-term care services and support programs, and requires states to develop a Medicaid managed care quality rating system for health plans. The final rule also permits states flexibility to allow managed care enrollees aged 21 to 64 to access psychiatric services in inpatient psychiatric hospitals. “These changes attempt to bring Medicaid managed care programs in closer alignment with Medicare Advantage and private insurance, particularly private insurance sold in the Health Insurance Marketplaces,” said AHA Executive Vice President Tom Nickels. “The new requirements include access and coverage protections for the patients that hospitals serve. For example, states will be required to set standards to ensure patients have adequate access to doctors and other providers, and will require insurers to frequently update their provider directories. We are pleased that adult patients will now have greater access to psychiatric health services, including the ability to receive care in an inpatient psychiatric hospital or facility providing short-term crisis residential services. We are disappointed that CMS will no longer allow supplemental payments in managed care plans, although a 10-year transition period will be helpful to hospitals as we continue to care for vulnerable patients.” AHA members will receive a Special Bulletin with further details.