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How CMCS Improved Managed Care in State Medicaid Programs

NAMD supports goals to improve the role managed care plays in the Medicaid Program.

By Vera Gruessner

Earlier this week, the Centers for Medicaid and CHIP Services (CMCS) finalized its ruling on the managed care Medicaid reimbursement regulations. Soon afterward, the National Association of Medicaid Directors (NAMD) released a statement regarding the final ruling.

Managed Care Medicaid Programs

CMCS is looking to ensure that managed care plays a bigger role in the Medicaid program by strengthening these regulations. Additionally, the CMCS rule is meant to improve federal standards for both state Medicaid programs and health plans.

NAMD supports goals to improve the role managed care plays in the Medicaid Program. Essentially, managed care has grown and transformed within the Medicaid reimbursement system over the last several years,  the statement from NAMD said.

Due to these deviations of managed care, it proves more important to reform the regulations within the Medicaid program so that this particular healthcare delivery system is well-supported.

Today, the healthcare industry is seeking to improve its quality of care by implementing population health strategies and ensuring patients are assisted through behavioral, clinical, and support services. Medicaid Managed Care programs follow alongside these value-based care goals.

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The new regulation is expected to build upon the already successful healthcare delivery models being put in place around the country. The ruling also establishes the opportunity for more improvement and reform within the managed care space, according to the NAMD statement.

The final rule does include a number of the comments made by NAMD after the initial proposed rule was published. For example, the rule dropped the prior requirement that a managed care beneficiary should be enrolled in a fee-for-service healthcare delivery model for 14 days before being eligible for managed care programs.

Additionally, NAMD is pleased with the finalization of ensuring the Medicaid program covers the costs of services in Institutions for Mental Disease (IMD) among managed care enrollees. This type of provision should help ensure that Medicaid beneficiaries have equal access to mental health treatment.

“The task for CMCS moving forward will be to look holistically at the final regulation and begin working with state Medicaid Directors and NAMD to flesh out many of the critical operational details and additional sub-regulatory policy guidance essential for a successful implementation that reflects local conditions,” according to the statement from NAMD. “States and our federal partners will need to effectively use their limited resources and capacity to carry out these changes.”

“Finally, states have also asked CMCS to ensure that implementation efforts and CMCS approvals do not interfere with regular program operations and thereby delay the critical transition to value-based purchasing efforts occurring across the country. We stand ready to work closely with our federal partners to make the necessary next steps in order to ensure we have the tools and make realistic use of available resources to ensure that Medicaid remains a highly functioning, effective and efficient program.”

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The National Association of Medicaid Directors also recognized the importance of keeping the different sections of the regulation from being implemented all at the same time and supports the requirements of a phased-in approach to adopting the new rule.

In July 2015, the NAMD sent a letter to the Center for Medicaid & CHIP Services commenting on its initial proposed rule Medicaid and Children’s Health Insurance Programs; Medicaid Managed Care, CHIP Delivered in Managed Care, Medicaid and CHIP Comprehensive Quality Strategies and Revisions Related to Third Party Liability.

The letter called on for a flexible regulatory framework when renovating the managed care space within the Medicaid program. Additionally, the organization feels that the Centers for Medicare & Medicaid Services (CMS) should incorporate rulings that foster innovation and support new technologies.

Individual states will also need the flexibility to operate their Medicaid programs to serve the unique and differing populations of each region. Both CMS and NAMD support the idea of greater alignment and care coordination throughout the Medicaid programs, especially when it comes to the managed care population.

However, the letter stated that CMS could also further alignment by developing stronger “coherence with other federal agencies” especially when it comes to data reporting.

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“We are concerned that the framework would require a plethora of major program changes that would increase costs to states and the federal government. Each one of the policy changes and reporting requirements in the proposed rule will require analysis, dedicated staff time, contract amendments, and other programmatic change that will require significant resources to implement. States have limited capacity and funds to carry out these changes,” the letter stated. “CMS should identify ways to support states in implementing the new regulations and ways to offset the resource burden.”

“Due to the extensive scope of policy change in the rule, we further recommend that CMS not implement the major provisions of the regulation simultaneously, as currently proposed. Instead, CMS should use a staggered timeline for implementation that reflects the complexity of the regulation.”

CMS has clearly followed the guidelines to slowly phase in each part of the regulatory ruling so that state Medicaid programs are not overwhelmed and their resources remain accessible.

As new regulations become a part of state Medicaid programs, the federal government and the healthcare industry as a whole will likely continue to focus on value-based, quality care as well as the opportunity to further innovate and reform healthcare delivery systems.


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