New Medicaid Managed Care Regulations

June 25, 2015 No Comments by intergrowth

With CMS’s recent proposed changes to Medicaid and Children’s Health Insurance Plan (CHIP) regulations – the first major change in more than 10 years – managed care will likely experience a major shift and the health care industry must be ready. Any quick online search on the new regulations will turn up headlines such as “epic”, “game changing”, and “sweeping” – underscoring the magnitude of these changes.

The document clocks in at 653 pages and will require extensive review and analysis. Comments must be submitted to CMS by July 27th. Below are high-level summaries of the categories. (For more specific language on any category or to read the entire document: Click Here.)

Summary of Proposed New Medicaid Managed Care Regulations

Medical Loss Ratio (MLR) determination provisions: Specifically calls for a minimum (at least 85%) and a maximum to be put in place by 1/1 17

Rate Setting Provisions: Requires states to use the MLR reporting to assist in future rate development (rate setting must occur 90 days prior to implementation.)

Marketing Provisions: Proposes loosening of restrictions regarding marketing a Qualified Health Plan (QHP) to current Medicaid members who lose their Medicaid eligibility

Network Adequacy & Beneficiary Information: Updates standards to more closely align with QHP and Medicare Advantage standards (standards would be set by the state.)

Managed Care Quality Rating System: Proposes that states adopt a quality rating system to address three key areas (clinical quality management, member experience, and plan efficiency, affordability, and management). States may also default to the MA five-star rating for plans that serve members who are dually eligible.

Standardization of Grievance and Appeals Processes: Standardizes definitions, timing, and processes for grievances and appeals

Managed Long Term Supports and Services (MLTSS): Aligns managed care regulations with the 10 principles of MLTSS programs that came out in 2013

Enrollment & Disenrollment: Requires a member choice period of at least 14 days for plan selection and allows MLTSS members to disenroll at any time

Update to IMD Exclusion: Adds capitation payment to MCOs and prepaid inpatient health plans (PIHPs) for enrollees aged 21-64 who are residing in an institution for mental disease for less than 15 days of the month

As the ongoing debate continues, we want to know your thoughts. Do you think the proposed changes will improve the overall managed care system? We believe the changes will drive improvements to the overall delivery system, but we also think that health plans and State will need the freedom and flexibility to continue to develop innovative models to address members’ needs. Let us know your thoughts.

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