[Federal Register Volume 76, Number 88 (Friday, May 6, 2011)]
[Proposed Rules]
[Pages 26342-26362]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-10681]
[[Page 26341]]
Vol. 76
Friday,
No. 88
May 6, 2011
Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Part 447
Medicare Program; Methods for Assuring Access to Covered Medicaid
Services; Proposed Rule
Federal Register / Vol. 76 , No. 88 / Friday, May 6, 2011 / Proposed
Rules
[[Page 26342]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 447
[CMS 2328-P]
RIN 0938-AQ54
Medicaid Program; Methods for Assuring Access to Covered Medicaid
Services
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would create a standardized, transparent
process for States to follow as part of their broader efforts to
``assure that payments are consistent with efficiency, economy, and
quality of care and are sufficient to enlist enough providers so that
care and services are available under the plan at least to the extent
that such care and services are available to the general population in
the geographic area'' as required by section 1902(a)(30)(A) of the
Social Security Act (the Act). This proposed rule would also recognize,
as States have requested, electronic publication as an optional means
of communicating State plan amendments (SPAs) proposed rate-setting
policy changes to the public.
DATES: To be assured consideration, comments must be received at one of
the addresses provided below, no later than 5 p.m. July 5, 2011.
ADDRESSES: In commenting, please refer to file code CMS-2328-P. Because
of staff and resource limitations, we cannot accept comments by
facsimile (FAX) transmission.
You may submit comments in one of four ways (please choose only one
of the ways listed):
1. Electronically. You may submit electronic comments on this
regulation to http://www.regulations.gov. Follow the ``Submit a
comment'' instructions.
2. By regular mail. You may mail written comments to the following
address only: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-2328-P, P.O. Box 8016,
Baltimore, MD 21244-8016. Please allow sufficient time for mailed
comments to be received before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address only: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-2328-P, Mail
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
4. By hand or courier. If you prefer, you may deliver (by hand or
courier) your written comments before the close of the comment period
to either of the following addresses:
a. For delivery in Washington, DC--Centers for Medicare & Medicaid
Services, Department of Health and Human Services, Room 445-G, Hubert
H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC
20201.
(Because access to the interior of the Hubert H. Humphrey Building
is not readily available to persons without Federal Government
identification, commenters are encouraged to leave their comments in
the CMS drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain a proof of filing
by stamping in and retaining an extra copy of the comments being
filed.)
b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid
Services, Department of Health and Human Services, 7500 Security
Boulevard, Baltimore, MD 21244-1850.
If you intend to deliver your comments to the Baltimore address,
please call telephone number (410) 786-7195 in advance to schedule your
arrival with one of our staff members.
Comments mailed to the addresses indicated as appropriate for hand
or courier delivery may be delayed and received after the comment
period.
Submission of comments on paperwork requirements. You may submit
comments on this document's paperwork requirements by following the
instructions at the end of the ``Collection of Information
Requirements'' section in this document.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Jeremy Silanskis, (410) 786-1592.
SUPPLEMENTARY INFORMATION: Inspection of Public Comments: All comments
received before the close of the comment period are available for
viewing by the public, including any personally identifiable or
confidential business information that is included in a comment. We
post all comments received before the close of the comment period on
the following Web site as soon as possible after they have been
received: http://www.regulations.gov. Follow the search instructions on
that Web site to view public comments.
Comments received timely will also be available for public
inspection as they are received, generally beginning approximately 3
weeks after publication of a document, at the headquarters of the
Centers for Medicare & Medicaid Services, 7500 Security Boulevard,
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30
a.m. to 4 p.m. To schedule an appointment to view public comments,
phone 1-800-743-3951.
I. Background
A. General Information
Title XIX of the Social Security Act (the Act) authorizes the
Secretary of the Department of Health and Human Services (the
Secretary) to provide grants to States to help finance programs
furnishing medical assistance (State Medicaid programs) to specified
groups of eligible individuals in accordance with an approved State
plan. ``Medical Assistance'' is defined at section 1905(a) of the Act
as payment for part or all of the cost of a list of specified care and
services, or the care and services themselves, or both.
Federal law provides a broad framework for State Medicaid programs,
within which States have considerable flexibility. Details concerning
the scope of covered services, the groups of eligible individuals, the
payment methodologies for covered services, and all other information
necessary to assure that the plan can be a basis for Federal Medicaid
funding must be set forth in the approved Medicaid State plan. To be
approved by the Department of Health and Human Services, the Medicaid
State plan must comply with requirements set forth in section 1902(a)
of the Act, as implemented and interpreted in applicable regulations
and guidance issued by CMS. The Secretary has delegated overall
authority for the Federal Medicaid program, including State plan
approval, to CMS.
Medicaid services are jointly funded by the Federal and State
governments in accordance with section 1903(a) of the Act. Section
1903(a)(1) of the Act provides for payments to States of a percentage
of expenditures under the approved State plan for covered medical
assistance. For general medical assistance, the ``Federal medical
assistance percentage'' (FMAP) varies among the States based on a
formula set forth in section 1905(b) of the Act that takes into
consideration State specific information under a formula set forth in
section 1905(b) of the Act. Beginning in 2014, the Federal Government
will assume all or a higher share of costs for certain beneficiaries
made eligible under the Patient Protection and Affordable Care Act of
2010, (Pub. L.
[[Page 26343]]
111-148, enacted March 23, 2010) (the Affordable Care Act).
The Medicaid statute requires that States provide coverage to
certain groups of individuals, and also requires that such coverage
include certain minimum benefits. In addition, States may elect to
cover other populations and benefits. In order to give meaning to
coverage requirements and options, beneficiaries must have meaningful
access to the health care items and services that are within the scope
of the covered benefits, as required by section 1902(a)(30)(A) of the
Act. Many factors affect whether beneficiaries have access to Medicaid
services, including but not limited to, the beneficiaries' health care
needs and characteristics, State or local service delivery models,
procedures for enrolling and reimbursing qualified providers, the
availability of providers in the community, and Medicaid service
payment rates to providers.
States have broad flexibility under the Act to establish service
delivery systems for covered health care items and services, to design
the procedures for enrolling providers of such care, and to set the
methods for establishing provider payment rates. For instance, many
States provide medical assistance primarily through capitated managed
care arrangements, while others use fee-for-service payment
arrangements (with or without primary care case management).
Increasingly, States are developing service delivery models that
emphasize medical homes, health homes, or broader integrated care
delivery systems to provide and coordinate medical services. The
delivery system design and accompanying payment methodologies can
significantly shape beneficiaries' abilities to access needed care by
facilitating the availability of such care. In addition, the delivery
system model and payment methodologies can improve access to care by
making available care management teams, physician assistants, community
care coordinators, telemedicine and telehealth, nurse help lines,
health information technology and other methods for providing
coordinated care and services and support in a setting and timeframe
that meet beneficiary needs.
As State delivery system models have evolved, so too have their
provider payment systems. Many States develop rates based on the costs
of providing the service, a review of the amount paid by commercial
payers in the private market, or as a percentage of rates paid under
the Medicare program for equivalent services. Often, rates are updated
based on specific trending factors such as the Medicare Economic Index
or a Medicaid trend factor that incorporates a State-determined
inflation adjustment rate. Rates may include supplemental or incentive
payments that encourage providers to serve Medicaid populations. For
instance, some States have authorized Medicaid providers to receive
supplemental payments for care coordination and care management, or for
achieving certain specified quality measures.
The flexibility in designing service delivery systems and provider
payment methodologies, as described above, is consistent with the
requirement in section 1902(a)(30)(A) of the Act that State Medicaid
plans must ``provide such methods and procedures relating to the
utilization of, and the payment for, care and services available under
the plan * * * as may be necessary to safeguard against unnecessary
utilization of such care and services and to assure that payments are
consistent with efficiency, economy, and quality of care and are
sufficient to enlist enough providers so that care and services are
available under the plan at least to the same extent that such care and
services are available to the general population in the geographic
area.''
Consistent with the requirement in section 1902(a)(30)(A) of the
Act to provide payment for care in an effective and efficient manner
consistent with quality of care, States are empowered to seek the best
value through their rate-setting policies and may tailor their access
strategies to take into account local conditions including geographic
disparities in the availability of providers and demand for particular
services. Achieving best value has been a key strategy for some States
that have attempted to reduce costs in the Medicaid program in these
difficult fiscal times. We do not intend to impair States' ability to
pursue that goal, or their ability to explore innovative approaches to
providing services and lowering costs for other reasons. Indeed, the
Secretary and CMS, including through the new Center for Medicare and
Medicaid Innovation, is actively engaged in helping States achieve
better value and better care while lowering per-person costs.
B. Discussion
Medicaid payment rate changes are a function of the State budget
process in many States. We recognize that payment reductions or other
adjustments to payment rates are legitimate tools to manage Medicaid
program costs and achieve overall budget objectives. However, payment
rate changes made without consideration of the potential impact on
access to care for Medicaid beneficiaries or without effective
processes for assuring that the impact on access will be monitored, may
lead to access problems. Payment rate changes are not in compliance
with the Medicaid access requirements if they result in a denial of
sufficient access to covered care and services.
Budget-driven payment changes have led to confusion about the
analysis required to demonstrate compliance with Medicaid access
requirements at section 1902(a)(30)(A) of the Act. States attempting to
reduce Medicaid costs through payment rate changes have increasingly
been faced with litigation challenging payment rate reductions as
inconsistent with the access provisions of section 1902(a)(30)(A) of
the Act. Resulting court decisions have not offered consistent
approaches to compliance with the access requirement. These decisions
have left States without clear and consistent guidelines and have
subjected them to considerable uncertainty as they move forward in
designing service delivery systems and payment methodologies.
For instance, the United States Court of Appeals for the Ninth
Circuit Court, in Orthopedic Hospital v. Belshe, 102 F.3d 1481, 1496
(1997), cert. denied, 522 U.S. 1044 (1998) required the State agency to
set provider payment rates that ``bear a reasonable relationship'' to
provider costs, based on ``responsible cost studies.'' This ruling was
reaffirmed by the Ninth Circuit in Independent Living v. Maxwell-Jolly,
572 F.3d 644 (2009). In contrast, the United States Court of Appeals
for the Seventh Circuit, in The Methodist Hospitals, Inc. v. Sullivan,
91 F.3d 1026, 1030 (1996) did not find any requirement for prior cost
studies or other procedural requirements. While other Federal Courts of
Appeals have also addressed the issue, there is no consensus among the
circuits.
Significantly, in 2009, the Congress created the Medicaid and CHIP
Payment and Access Commission (MACPAC) (Pub. L. 111-3, section 506)
specifically to study and make recommendations on beneficiary access to
care in Medicaid and the Children's Health Insurance Program (CHIP).
With members appointed by the non-partisan U.S. Comptroller General,
MACPAC reviewed 30 years of research and consulted extensively with key
stakeholders to develop a recommendation on how to measure access to
care for Medicaid beneficiaries. This recommendation was in MACPAC's
first report to the Congress, published on March 15, 2011.
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The MACPAC report sets out the three-part framework for analyzing
access to care which, as we discuss below in this section of the
proposed rule, we propose to adopt as part of a State-level review
strategy. The MACPAC-recommended framework considers: (1) Enrollee
needs; (2) the availability of care and providers; and (3) utilization
of services.
In this proposed rule, we recognize that States must have some
flexibility in designing the appropriate measures to demonstrate and
monitor access to care, which reflects unique and evolving State
service delivery models and service rate structures. At this point, a
singular approach to meeting the statutory requirement under section
1902(a)(30)(A) of the Act could prove to be ineffective given current
limitations on data, local variations in service delivery, beneficiary
needs, and provider practice roles. For these reasons, we are proposing
Federal guidelines to frame alternative approaches for States to
demonstrate consistency with the access requirement using a
standardized, transparent process, rather than setting nationwide
standards. We are soliciting comments on this basic approach.
It is important to note that, if adopted, this proposed rule would
not directly require States to adjust payment rates, nor to take any
steps that would not be consistent with efficiency, economy, and
quality of care. We believe that even if access issues are discovered
as a result of the analysis that would be required under this rule,
States may be able to resolve those issues through means other than
increasing payment rates. Rather, these rules proposed to clarify that
beneficiary access must be considered in setting and adjusting payment
methodologies for Medicaid services. If a problem is identified, any
number of steps might be appropriate, such as redesigning service
delivery strategies, or improving provider enrollment and retention
efforts. It has always been within the regulatory authority of CMS to
make SPA approval decisions based on sufficiency of beneficiary service
access and this proposed rule merely provides a more consistent and
transparent way to gather and analyze the necessary information to
support such reviews.
II. Proposed State Level Review Strategy for Compliance With Access
Requirements
We are not aware of any standardized, transparent methodology that
is broadly accepted to definitively measure access to health care and
services. Partly as a result, there has been no prior Federal
rulemaking or guidance previously on this subject. As a consequence, in
implementing their programs, States lack the guidance that they need to
understand the types of information that they are expected to analyze
and monitor in determining compliance with statutory access
requirements. This issue has come to light recently, both in litigation
and in our review of proposed Medicaid State plan amendments (SPAs)
that would reduce provider payment rates. Two Governors and several
State Medicaid directors have sought Federal guidance in this area, and
the Congress, by establishing MACPAC, has also expressed its interest
in promoting more information analysis and guidance with respect to
these important matters. MACPAC's March report is significant in that
it offers the first Congressionally-authorized expert recommendation on
standards and methodologies for defining access to health care and
health services.
We have a responsibility under the Act to ensure sufficient
beneficiary access to covered services and are aware of the
uncertainties and problems that arise for States in the absence of
Federal guidance on methods and standards for States to demonstrate
compliance with this requirement. At the same time, we are mindful that
the landscape of health care delivery systems and associated payment
methodologies is undergoing significant change, the relevant data are
not always available, and that MACPAC, the entity established by the
Congress to consider these issues, may adapt its first set of
recommendations.
As such, the strategy we are now proposing is designed to allow for
State and Federal review of beneficiary access to evolve over time and
for States to implement effective and efficient approaches and
solutions that are appropriate to their local and perhaps changing
circumstances. The proposed strategy would be a consistent and ongoing
State-level review to demonstrate sufficient beneficiary access to
services covered under the Medicaid State plan that is not solely
focused on provider payment rate changes and the State plan process,
but assesses ongoing performance.
We note that section 1902(a)(30)(A) of the Act, and the
requirements of this proposed rule, discuss access to care for all
Medicaid services paid through a State plan under fee-for-service and
do not extend to services provided through managed care arrangements.
Managed care entities are subject to separate access review procedures
that are set forth in 42 CFR part 438 to ensure network sufficiency and
procedures for beneficiaries to obtain needed services. We are
currently undertaking a review of State managed care access standards
and are considering future proposals to address access issues under
managed care delivery systems. The access requirements under section
1902(a)(30)(A) of the Act, apply equally to States that are not
changing provider payment rates and those that are. The proposed State
reviews, however, will provide an analytic framework to consider the
impact of any proposed Medicaid State plan rate reductions on service
access.
More specifically, we propose to require States to determine
appropriate data elements that focus on the MACPAC-recommended three-
part framework, which include information on: Enrollee needs,
availability of care and providers, and utilization of services. This
and other information that the State believes to be relevant, will be
periodically analyzed by States to demonstrate and monitor sufficient
access to care. The data and analysis will be made available to the
public and furnished to CMS as requested in the context of a SPA that
reduces provider rates or restructures provider payments in
circumstances that could result in access issues, or as part of ongoing
program reviews.
The MACPAC-recommended framework does not focus on one particular
data element, such as the relationship of provider payment rates to
provider costs, but recognizes that access to covered services is
affected by multiple factors. Though cost may be one consideration
affecting access to care, there are other factors such as local market
conditions, variable provider costs, administrative burden for
providers, and demographic differences. Depending upon State
circumstances, cost-based studies may not always be informative or
necessary. In addition, because many State payment rates are not
specifically calculated based on provider cost considerations, it can
be burdensome and not particularly productive to rely solely on that
one factor as a measure of access.
The proposed State-level review strategy would recognize an ongoing
responsibility to conduct periodic reviews of compliance with access
requirements for all Medicaid services and also a particular
responsibility to review and monitor sustained service access after
implementing a change in provider payment rates. While we are proposing
to allow States some discretion to determine appropriate measures to
demonstrate and monitor access to care within the three-part framework,
this proposal provides consistent steps for States to follow in
[[Page 26345]]
demonstrating and monitoring Medicaid access.
To ensure continuing compliance review, we propose that States must
conduct access reviews for a subset of services each calendar year and
release the results through public records or a web site developed and
maintained by the State, by January 1st of each year. We have chosen to
base the requirement on the calendar year because State fiscal years
vary. We note that States may issue the access reviews prior to, but no
later than January 1 of each year, with the first review completed by
no sooner than 12 months after the effective date of the final rule.
States may determine the services that they will review each year,
provided that each service is reviewed at least once every 5 years. The
reviews must include the specific measures that the State used to
analyze access to care by geographic location, discuss the measures in
the context of the MACPAC three-part framework, discuss any issues with
access that were discovered as a result of the review, and make a
recommendation about the consistency with the requirements of section
1902(a)(30)(A) of the Act.
We propose that, prior to submission of a SPA to reduce rates or
alter the structure of provider payment rates in circumstances that
could result in access issues for a covered service, the State would
need to submit information from an access review that had been
conducted within the year prior to submission of the SPA as applicable.
We are proposing this requirement so that CMS and the States will have
the information necessary to assess consistency with section
1902(a)(30)(A) of the Act before a rate reduction or restructuring
proposal is processed. Since it may be difficult to predict the impact
that a provider rate reduction or restructuring of provider payments
will have on access, we are also proposing that States develop special
procedures to monitor access to services after such a change has been
implemented. These procedures would result in a periodic review of
State-determined indices that demonstrate sustained access to care that
would be made available to CMS and the public.
To address potential issues that develop in service access, we are
proposing that States implement an ongoing mechanism that allows
beneficiary feedback. This feedback mechanism could be based on
beneficiary hotlines or surveys, an ombudsman program, or other
equivalent mechanisms. In addition, we are proposing that each State
specify a process to address any access issues that are discovered
through the ongoing access reviews and monitoring, through a corrective
action plan that would be submitted to CMS and would include specific
steps and a timeline for State action to address such issues. As
proposed under this proposed rule, States would need to submit their
action plan to CMS within 90 days of discovering an access issue.
Below, in section II.C. of this proposed rule, we offer some examples
of actions that States may take to address access issues.
A. Data Measures To Demonstrate Sufficiency of Access
We propose to provide States with discretion in determining the
appropriate data measures to demonstrate whether access is sufficient
through access reviews and monitoring efforts in the context of the
MACPAC-recommended framework. We are offering specific suggestions on
trends and factors that States could use to measure enrollee needs, the
availability of care and providers, and utilization, but we would allow
States to develop alternative approaches and improve on these
suggestions within each of these categories of required data. We are
soliciting public comments on additional data measures that may be
useful in measuring access in the context of the proposed framework and
whether it is appropriate to require certain data measures as part of
State access reviews.
We note at the outset that the data States would review under this
rule will explicitly address Medicaid beneficiary access. However, the
required statutory test is a comparison between Medicaid beneficiary
access and access to medical services by the general population in the
geographic area. While it is neither desirable nor feasible to require
that States develop new data sources on general access to medical
services, the data measures for Medicaid beneficiary fee-for-service
access may, in some cases, require that States compare information from
commercial insurance standards or Medicaid managed care. We welcome
public comment on any existing data sources that address general access
to medical services that might be relevant. In general, we are
confident that the Medicaid data will implicitly address general access
standards in the geographic area. For example, data on beneficiary
experience and satisfaction will take into account expectations based
on community standards, and the percentage of community providers
enrolled and accepting Medicaid patients will necessarily indicate the
availability of such providers in the community.
We believe the meeting of enrollee needs should be the primary
driver to determine whether access to care is sufficient. Measurable
data on the beneficiaries' experiences and needs, however, may be
difficult for States to attain. States may need to rely upon
qualitative information that is received through beneficiary surveys or
other means, such as hotlines or beneficiary Ombudsman offices that
some States may have in place, and may request that community-based
organizations, primary care providers, hospitals, case management, and
other providers assist in soliciting the information from
beneficiaries. Once a State determines the most efficient means to
reach beneficiaries, it has a number of options for data elements that
could be significant in assessing whether their needs are met:
Extent of knowledge that a service is covered by the
Medicaid program;
Success in scheduling a service appointment with a
provider, including after hours as necessary;
Satisfaction with the availability of service providers
within a reasonable distance from home;
Ability to obtain transportation to and from a scheduled
appointment;
Number and reasons for emergency room services received in
the year;
Number and reasons for missed appointments and means;
Ability to either schedule an appointment or receive
services in light of limited English language proficiency;
Turnover in providers such as with homecare workers or
personal care attendants; and
Means and ability to seek help in scheduling service
appointments.
The connection between the number of enrolled providers and the
availability of services is seemingly obvious, but there are many
qualifications that affect the meaningfulness of such data. It may be
important to know the number of enrolled providers in relation to the
overall number of providers in the community. And, in order to
contribute to beneficiary access, it is significant to know whether
enrolled providers have ``open panels'' which means that they are
accepting Medicaid patients.
Data on the availability of care and providers is likely more
easily obtainable by States, measurable and able to be monitored on a
consistent basis. Many of the elements that we suggest below are likely
available through current State information systems, while some of the
information may require a survey of the providers within the State.
With that in mind,
[[Page 26346]]
States could review the following data elements:
The availability of care and services through Medicaid
fee-for-service as compared to access standards established under
Medicaid managed care;
The availability of care and services through Medicaid
fee-for-service as compared to commercial managed care or other
commercial insurance access standards.
The number of providers with open panels who are accepting
new Medicaid patients;
The extent to which timely follow-up visits occur after an
emergency visit or inpatient stay;
Provider Medicaid enrollment (with open panels) compared
to licensed providers in the preceding rate year applicable to each
covered service;
Provider Medicaid enrollment compared to actual provider
Medicaid participation (as measured by claims submitted) in the
preceding rate year applicable to each covered service;
Provider Medicaid enrollment (with open panels) compared
to provider enrollment in one of the four largest commercial insurers
in the State in the preceding rate year applicable to each covered
service;
Provider loss and retention in the preceding rate year
applicable to each covered service;
The average amount of time from provider application for
enrollment to the approval of the provider agreement; and
The average amount of time from provider claim submission
to payment of the claim by the Medicaid agency.
Beneficiary service utilization data is relevant because changes in
beneficiary service utilization can indicate access problems. In
particular, drops in service utilization that coincide with payment
changes may indicate access problems. In addition, patterns of
beneficiaries obtaining access to care through hospital emergency rooms
may be an indication of the access problems for certain categories of
services.
Beneficiary utilization data is readily available through State
information claims systems and relatively easy for States to review and
monitor. For purposes of reviewing utilization, States could focus on
Medicaid utilization of applicable covered Medicaid State plan services
in the preceding rate year on a per capita basis and also take into
account that some services apply to subsets of the population (such as
pediatric services and obstetrics services). States could also look at
avoidable emergency room visits and hospital admissions to determine if
there are issues with preventive hospital use that may suggest a
corresponding access issue.
Consistent with the performance standard measures described under
the Affordable Care Act, we are actively working, with input from State
partners to develop a coordinated and streamlined data solution aimed
at reducing redundancy, administrative burden, and to maximize business
value. As we propose to have States review data to measure Medicaid
access to care, we are mindful that our broader data improvement and
streamlining efforts that aim to inform program performance and
compliance may also be useful to States in informing access to care. As
part of this proposed rule, we are asking States to consider how
measures of access to care may align with current program oversight and
review activities so that the access reviews build upon existing State
data collection efforts that are used to improve overall program
efficiency and quality. In addition, through our data efforts, we will
work to identify and highlight data available within CMS and States
that can inform the State access review under this proposed rule and
monitor access on a national basis.
We also will offer States technical assistance in identifying
available data resources and facilitate cross-State collaboration as
they undertake the access review procedures proposed under this
proposed rule. To initiate our technical assistance, we have worked
with our Federal partners to develop a matrix of potential Federal and
State data resources which may be helpful to States in developing their
access reviews. These resources are listed below in section IV. of this
proposed rule.
The resources presented in section IV. do not address each data
element identified in this proposed rule and much of the data will need
to be obtained from existing or developed State sources. We are
soliciting public comments and suggestions on these and other existing
sources of data that may help States inform their rate-setting policies
and their efforts to ensure service access. We will also develop a
standardized template for States to report and make publically
available the data analysis identified under this proposed rule. The
template will be designed to focus on the data elements that a State
has reviewed to measure access to care within the MACPAC recommended
framework, any issues that the State has identified as a result of the
review, and the State agency's recommendation on the sufficiency of
access to care based on the review. We are soliciting public comments
on the content of the access template and specifically, the important
areas that States should address in their reviews. We believe the
reviews should address, minimally, the data elements reviewed under the
MACPAC recommended framework, including the information gathered on
beneficiary experience, and the Medicaid payment rate comparison.
However, we are interested in exploring additional topics that should
be standardized through the template.
B. Public Process To Involve Stakeholders
In addition to the access rate review, we propose to require a
public process that States would conduct prior to submitting State plan
amendments that propose Medicaid provider payment rate reductions or
changes in the provider payment structure. We are not prescribing a
specific form for that public process, but we would require that the
State describe the process that they have developed in their State
plan. We are soliciting public comments on whether specific elements
regarding that process should be required. We also encourage States to
conduct the public process in any instance when the State data
collection and monitoring process uncovers an access issue. The purpose
of the public process would be to provide a meaningful opportunity for
beneficiaries, providers, and other interested parties to provide input
and feedback on the impact that the proposed rate reductions will have
on efficiency, economy, and access to care, offer ideas to enhance
service delivery models and other innovative solutions to address
access issues, discuss strategies to encourage continued provider
participation, and develop the procedures that States will use to
monitor access to care after implementation of the proposed rate
reductions.
We are proposing to require this public process in part because we
have found that States that worked with affected stakeholders prior to
implementing rate reductions often maintained a commitment from
providers to continue to serve Medicaid beneficiaries. States have
frequently held these discussions with the affected provider community.
We are proposing that States also discuss the impact of proposed rate
reductions with beneficiaries and other interested parties. As stated
earlier in section II.A. of this proposed rule, we believe that
beneficiaries' experiences in receiving services are a primary driver
in determining the sufficiency of service access and it is important
that their
[[Page 26347]]
views concerning changes that could directly affect their care be
solicited.
Moreover, it is also important to have a public process that
obtains feedback from all affected stakeholders because each may have
unique approaches to mediating Medicaid service access issues,
promoting provider participation in the program, and assuring the
program operates in an efficient and economical way. As proposed, the
public process requirements will solicit feedback from stakeholders in
determining the monitoring and oversight procedures that a State will
implement to ensure access is sustained after the implementation of a
rate reduction.
C. Monitoring Access and Corrective Action To Address Access
As States review their service access data and monitor access after
implementing rate reductions, it is important to have a process in
place to address access issues that are uncovered through the new
process. While we, through official compliance procedures, may address
issues by requiring the State to develop a corrective action plan
detailing action steps and timelines to address access issues, we are
also proposing to allow States to identify access issues and submit a
corrective action plan within 90 days of discovering the problem. When
a State develops a corrective action plan on its own, we would not
treat it as a finding of non-compliance, but as evidence of a good
faith effort by the State to remain in compliance. Action plans may
also be developed to improve the State's information base going
forward, regardless of whether a particular access problem is
identified.
While a corrective action plan may have longer term action steps,
it should set a target for compliance with access requirements that is
no longer than one year from the submittal of the plan to CMS. We are
also encouraging States to work with stakeholders through the public
process to develop monitoring indices to ensure sustained access to
care and remediation plans that address known access issues.
Stakeholders can provide valuable input and assistance in the
identification and implementation of measurable efforts that could
increase access as appropriate for their local health delivery
infrastructure, service delivery system, and other factors.
The precise nature of needed corrective action depends on
individual State circumstances. For instance, a State could submit
action steps and a timeline to reduce administrative burdens on
providers or to implement and oversee a program through which
beneficiaries receive assistance in finding a service appointment. We
understand that some States have ``ombudsman'' programs to aid
beneficiaries in finding service appointments as part of their managed
care systems and we offer that these programs could serve as one step
in alleviating fee-for-service access issues or could help pinpoint the
access issues with great precision. Alternatively, or perhaps in
addition, a State might seek to incentivize the development or
expansion of clinics in underserved areas where access is of particular
concern. States could also structure their service reimbursement rates
to address particular geographic disparities in service access or to
offer incentives for available evening and weekend appointments to
working individuals who may not have flexible schedules to accommodate
regular work hour appointments. A State could also review, modify or
implement transportation, telemedicine or integrated models of care
(such as health homes or primary care case management) policies that
serve to make care available in efficient and effective ways.
In proposing to address access to care issues through any of these
approaches, it would be important for States to describe their process
for monitoring program effectiveness in improving or maintaining
service access through use of these action steps so that the State will
ultimately comply with the requirements at section 1902(a)(30)(A)of the
Act.
D. Clarification and Electronic Publication of State Public Notice
In addition to establishing a framework for documenting access to
covered Medicaid services, this proposed rule would update the public
notice requirement in Sec. 447.205 by recognizing electronic
publication as a means to notify the public of payment policy changes.
We are proposing this change at the request of States to relieve State
burden. The current regulatory language, which requires publication in
a State register similar to the Federal Register, the newspaper of
widest circulation in each city with a population of 50,000 or more, or
the newspaper of widest circulation in the State, if there is no city
with a population of 50,000 or more, was drafted prior to widespread
accessibility of the web and development of State government web sites
and we are updating the regulation to consider electronic methods of
publication.
We are also soliciting public comment on the use of the term
``significant'' in Sec. 447.205(a). The current public notice
regulation calls for notice of ``significant'' changes in methods and
standards, which has resulted in some confusion among States in
determining when it is appropriate to publish notice. Because the term
``significant'' is not defined, and because the impact of payment
changes is not always objectively clear, States are not always clear on
when it is appropriate to notify the public of changes to rate-setting
methods and standards.
Longstanding CMS policy has been to require public notice for any
change in payment methods and standards because there is no definable
threshold for a ``significant'' change that can apply across services,
service providers, beneficiaries and other stakeholders. A change that
may be significant for one individual or group of stakeholders may not
be significant to another. Therefore, the historic interpretation has
been applied because it is important for providers, beneficiaries and
stakeholders to be aware of all changes in State rate policies and
evaluate how those changes impact the delivery of Medicaid services. In
addition, given that the process for amending the approved State plan
to change provider payment rates is somewhat complex, we do not believe
that States go through that process for changes that are not
significant.
We are soliciting public comments to determine if it is appropriate
to clarify the public notice requirement at this time. One option to
clarify the requirement is to remove the reference to significance and
clarify that any changes in rates, methods and standards require public
notice as has been consistent with CMS policy. We could also establish
a threshold for significance.
III. Specific Proposed Regulatory Changes
A. Existing Authorities
Section 1902(a)(30)(A) of the Act requires that, in order to
receive Federal Financial Participation (FFP), States must set Medicaid
service payment rates that are consistent with efficiency, economy, and
quality of care and are sufficient to enlist enough providers so that
services are available to Medicaid eligible individuals to the extent
that they are available to the general population in the geographic
area. The regulations located at 42 CFR part 447 subpart B (Payment
Methods: General Provisions) sets forth the implementation requirements
that States must follow when establishing Medicaid payment rates.
[[Page 26348]]
Regulations at Sec. 447.203 establish certain documentation
requirements that the State Medicaid agency must maintain and make
available to the Department of Health and Human Services upon request.
Specifically, for any increase in payment rates, the State Medicaid
agency is required to record an estimate of the percentile of the range
of customary charges to which the revised payment structure applies, a
description of the methods used to make the estimate and an estimate of
the composite average percentage increase of the revised payment rates
of the preceding rates. This information is recorded in State manuals
or other official files and applies to individual practitioner
services.
As currently described, Sec. 447.203 requires that States document
a comparison of increased payment rates to customary charges and
preceding rates at the time that the increase occurs and only for
practitioner service rates. The documentation requirement does not
contemplate rate decreases or include a process or timeframe for States
to update the methodology and make a rate comparison using contemporary
data. Further, the documentation process does not account for all
Medicaid provider payments and could be interpreted to exclude payment
increases for hospital, clinic, long-term care facilities, hospice,
home health care, durable medical equipment, and other Medicaid service
rates that encompass costs beyond practitioner services. Clearly, the
regulation was intended to document potential overpayments for a subset
of Medicaid service rates and is insufficient, in its current scope, to
ensure the collection of information on efficiency, economy, and
adequacy of current payment rates across all services and to measure
service access.
Regulations at Sec. 447.204 implement, in part, section
1902(a)(30)(A) of the Act by adopting into the CFR the statutory
requirement for comparable general population service availability. The
regulation replicates the statute, stating that payments must be
sufficient to enlist enough providers to ensure that services under the
plan are available to recipients at least to the extent that those
services are available to the general public. However, the regulation
does not provide additional guidance to States on standards to
demonstrate sufficient access to Medicaid services. Without specific
guidance, States have attempted to comply with this regulation through
a variety of methods. As discussed in more detail in section III.A. of
this proposed rule, these methods include: stated assurances, public
processes, and/or data reviews, each of which may not fully demonstrate
that rates are sufficient to provide for Medicaid service access
equivalent to service access available to the general public consistent
with the statute.
Regulations at Sec. 447.205 require, with certain exceptions, that
the State agency provide public notice of any significant proposed
change in methods and standards for setting Medicaid payment rates.
Prior to the effective date of a change in methodology, which must be
submitted to CMS for review through a Medicaid SPA, States are required
to notify the public of the proposed change through publication of a
public notice that is published in: a State register similar to the
Federal Register, or the newspaper of widest circulation in each city
with a population of 50,000 or more. If there is no city with a
population of 50,000 or more within the State, the publication must be
made in the newspaper of widest circulation within the State. The
regulation specifies that the content of the public notice describe the
proposed change in methods and standards, explain the reason for the
change, identify the local agencies where the changes are available for
public review, provide an address where comments may be sent and
reviewed by the public, and give the location, date and time for any
public hearings on the change. The public notice requirement is meant
to notify stakeholders of rate-setting policy changes that have already
been determined and does not require that States examine and provide
the public with any information on the resulting impact on service
access that the proposed changes may have once such changes have taken
effect.
B. State Plan Review Process Changes
Since 2008, as more States sought to amend Medicaid State plan
payment methodologies by instituting significant provider rate changes,
we have requested that States provide information to help the agency
determine that the changes to rates resulting from State plan
amendments will continue to provide for access to care consistent with
the Act and the implementing regulations. As part of the SPA review
process, we requested this information either informally or through a
formal request for additional information. Though we did not develop a
standard set of questions for all SPA information requests, similar
concerns over adherence to the provisions of Sec. 447.204 were raised
in many of the rate reduction SPA reviews. Without clear standards or
processes for determining sufficient rates that will maintain access
and encourage provider participation, States were offered a variety of
means to satisfy the statutory requirement.
Based on our current review methods, all States that propose to
implement rate reductions through a SPA submittal, or change payment
rate structures during the rate year, respond with a statement assuring
that access would not be affected by the changes in the amendment. When
asked for additional detail on the methodology that States used to
determine compliance with the access requirement, only a few States
indicated that they relied upon actual data to make the determination.
Of the States that relied upon data, most focused on historical levels
of provider enrollment and their belief that providers would not
disenroll based on a reduction in payments. A few States also looked at
rates as compared to cost, Medicare rates, or payment rates in
surrounding States to determine the impact of the reductions. Some
States noted that historic reductions had no discernible impact on
provider participation and so they did not anticipate access issues as
a result of additional reductions.
Nearly every State held a public meeting that invited some or all
of the providers to discuss the proposed changes or at least held
informal discussions with providers and policy-makers. Approximately
half of the States also included consumer groups and other affected
stakeholders as part of the rate proposal hearings or discussions. Many
of these public hearings, however, seemed focused on awareness of the
coming rate changes, rather than a discussion on the potential impact
to service access.
Finally, when asked how they intended to monitor the impact of the
rate changes on access, a few States indicated that they would review
data submitted to their Medicaid Management Information Systems to
determine if services utilization or provider participation levels
dropped after the changes were implemented. Some States have hotlines
or other mechanisms to record consumer complaints, although it is not
clear how widely known these mechanisms are among beneficiaries or how
the complaints are considered or evaluated over time. The majority of
States did not offer any plan to monitor the impact of the rate
reduction on an on-going basis or to make rate adjustments or other
changes based on the monitoring activities.
Absent data on the sufficiency of State efforts, including State
plan rates, to
[[Page 26349]]
achieve access consistent with efficiency, economy, and quality and
without a defined process for involving stakeholders in rate setting
determinations, we have generally relied upon State assurances and
these disparate State approaches to make decisions on proposed rate
reduction SPAs. It should be noted that in one instance, we informed a
State that based upon the persistent, widespread negative reaction by
providers in response to a proposed significant rate reduction of an
already low rate (by comparison to commercial rates and other State
Medicaid rates for the same service), that we could not approve a
reduction amendment as submitted because of concerns that Medicaid
eligible individuals would no longer have adequate access to care. In a
similar situation, where a State also failed to provide any information
or analysis on whether the rate proposal would negatively impact access
after the implementation of proposed reductions, we have denied the
relevant SPAs.
We agree with MACPAC that it is more consistent with the statute to
make such decisions in the context of a consistent framework for
evaluating access, informative data and a transparent process that
assures stakeholder involvement. Therefore, we are proposing clear
guidelines on data collection efforts and public processes that all
States must implement in order to demonstrate that rate-setting is
informed by sustained access to services consistent with the
requirements of section 1902(a)(30)(A) of the Act.
We are also proposing to require that States should submit to CMS,
in support of State plan amendments that reduce payment rates or
restructure provider payments in circumstance when the resulting
changes could create access issues, an analysis based on access data
collected during the prior year. The data itself would be available to
CMS for review upon request.
C. Standards for CMS Review of Compliance With Access Requirements and
State Plan Amendments Affecting Access
As discussed above, we are proposing a State-level ongoing access
review process that will generate analysis and data concerning access
issues, and will provide a framework for ongoing monitoring and
corrective action. We would consider State compliance with these
procedural requirements, including both the access review process and
the need for identification of access issues and corrective action
plans, to be essential to a demonstration of compliance when we review
proposed State plan amendments that affect access to services, such as
provider payment reductions or restructuring. When a State has not
complied with the access review requirements, we would not approve such
a State plan amendment.
We have considered and declined to propose setting a single uniform
Federal standard for reviewing substantive compliance with access
requirements because we believe that determination of such compliance
is very fact-specific and data-specific, taking into consideration
local circumstances.
In our review of compliance with access requirements, we intend to
focus on working with States to improve beneficiary access mindful of
legitimate efforts to ensure that State policies are consistent with
efficiency and economy, as well as to the potential advantages of
innovative methods of service delivery, provider payment, and case
management. However, we will have a perspective in reviewing State-
level access reviews and underlying data that States themselves will
not have. This is because we will have the advantage of having seen
similar access reviews from other States and will recognize best
practices and analytic methodologies based on that experience.
Federal review will be based on the statutory standard that the
State must have methods and procedures ``to assure that payments are
consistent with efficiency, economy, and quality of care, and
sufficient to enlist enough providers so that care and services under
the plan are available under the plan at least to the extent that such
care and services are available to the general population in the
geographic area.'' We believe that application of this standard
requires a review and analysis of data in light of local circumstances.
Determinations of compliance will necessarily involve judgments as to
how to weigh the data States develop on access measures, and at least
without more experience and analysis we do not believe those judgments
can be readily reduced to procedural or substantive formulas. We invite
comment on possible national or State-specific access threshold tests,
particularly given that the statutory requirement to measure access to
care in relation to the availability of care and services to ``the
general population in the geographic area'' suggests a State-specific
CMS review.
In Federal oversight of State-level reviews to determine ongoing
compliance with the statutory access requirement, we do not intend to
develop independent analyses of beneficiary access to services, but
instead will review State analyses to ensure that the State-level
review process operated to reasonably demonstrate substantive
compliance with the access requirements. Our review will generally be
limited to the issues of whether the State collected relevant data on
each of the required elements, and reasonably analyzed that data to
find substantive compliance with access requirements. While we intend
to conduct a case-by-case review of these State-level reviews, we may
also issue guidance on State-level review practices and may integrate
such guidance into our Federal oversight review.
Such guidance may direct the State with respect to the analysis of
the required data, and we may consider a State analysis to be deficient
if those practices are not applied. For example, such guidance might
inform States about how to appropriately weigh different types of data
to ensure that the resulting analysis reflects overall access. If we
conclude that a State-level review and analysis is deficient and
therefore does not reasonably demonstrate compliance with the statutory
access requirements, we intend to initiate a compliance process (which
could involve requiring a corrective action plan pursuant to these
regulations) or, for a pending SPA, we would disapprove the SPA. In
that latter instance, we note that the State would have an opportunity
during the reconsideration process to correct deficiencies in the
State-level review and access analysis.
We note that Federal oversight of State reviews will likely be more
stringent when the State proposes changes in provider payment of
significant magnitude, or when we have other evidence, either through
data or other sources, of an access problem.
While we are not proposing any single Federal standard for
reviewing access issues, we are inviting public comment on whether
there should be particular indicators that we would regard as an
irreducible minimum standard. We have not proposed such a minimum
standard for several reasons. First, it is not clear whether any
particular indicator is going to be determinative of access issues in
every circumstance. The access reviews will examine a number of
indicators, and we believe they are best examined in the aggregate. In
most cases, we believe that the different indicators that a State
examines will confirm each other, but in some cases there may actually
be a reason for a variation in the results that is based on a State-
specific characteristic. In any case, we believe that the overall
access review process should make serious
[[Page 26350]]
access problems obvious and easily addressed in a case-by-case review.
We also invite comment from States and others on whether a single or
small set of Federally determined indicators is preferable
administratively to a broader set of State determined indictors.
IV. State Use of National Data Resources To Fulfill Proposed Data
Requirements
As discussed previously in this proposed rule, we have worked
closely with our partners within the Federal Government, the MACPAC,
and a number of experts in an attempt to identify potential sources of
data that States may use to fulfill their responsibilities under the
proposal. We recognize that much of the information necessary to
evaluate access may require States to use existing State data or
develop or implement new resources, such as a beneficiary survey. We
also recognize that data from different sources have distinct
definitions, timeframes for collection, and therefore, challenge and
limitations exist to trending data reliably. We are soliciting public
comments on existing sources of data that States may use to ensure that
they are fulfilling their responsibility to assure access to care and,
if States are already analyzing data to measure access to care, that
they share their sources and methods of data collection with other
States either through public comment to this proposed rule or through
MACPAC.
At the Federal level, the Health Resources and Services
Administration (HRSA) publishes the Uniform Data System, which includes
patient count, diagnosis and expense data at the grantee, State and
national levels for HRSA's Federally Qualified Health Center grantees,
which are funded under section 330 of the Public Health Service Act.
This information is available at http://www.hrsa.gov/data-statistics/health-center-data/index.html#what. The HRSA also publishes State data
on shortages in primary care, dental and mental health providers on the
Health Areas Shortage Designation web site (http://hpsafind.hrsa.gov/HPSASearch.aspx). This information may be of particular use to States
in targeting specific State locations where access problems are a known
issue in that geographic area, without regard to payer. The Agency for
Healthcare Research and Quality (AHRQ) has developed a Medical
Expenditures Panel Survey, available at http://www.meps.ahrq.gov/mepsweb/data_stats/onsite_datacenter.jsp, which offers surveys of
families and individuals, medical providers, and employers to document
cost and use of health care and health insurance coverage. The Centers
for Disease Control and Prevention (CDC), produces the National
Ambulatory Medical Care Survey, which describes data on utilization and
the provision of ambulatory care services in hospital emergency and
outpatient departments, (http://www.cdc.gov/nchs/ahcd.htm), and the
National Health Interview Survey, which tracks health status and health
care access: (http://www.cdc.gov/nchs/nhis.htm).
We publish a number of Medicare and Medicaid data measures through
a contractor, the Research Data Assistance Center (RESDAC), (http://www.resdac.org/). In addition, we have developed the Medicare Current
Beneficiary Survey, which States may find of use in developing surveys
that track beneficiary experience (https://www.cms.gov/). States may
also find the U.S. Census Bureau's Current Population Survey of use for
developing beneficiary questionnaires, http://www.census.gov/.
For external resources, the State Health Access Data Assistance
Center (SHADAC) Web site, http://www.shadac.org/, which includes access
data measures for each State. Finally, as part of MACPAC's three part
approach to measuring access to care, the Commission offers a number of
useful survey resources that States may find helpful in their first
published report to the Congress, which was issued on March 15, 2011,
(http://www.macpac.gov/reports).
We are working to improve upon Medicaid data collection and
analyses more generally and will be soon reaching out to States to help
us identify the data and measures that are most important to guide
State and Federal administration of the Medicaid program. We believe
these broader data and performance measures will ultimately provide new
resources for States to use as they carry out their important
responsibilities to assure access to care consistent with the
principles of efficiency, economy, and quality of care.
V. Provisions of the Proposed Regulations
The provisions of this proposed rule aim to create a consistent
national approach to analyze and document Medicaid service access that
allows States to formulate their own processes, metrics, and approaches
in light of the range of local factors and circumstances that influence
access in their State. In addition, the provisions seek to clarify and
modernize the public notice regulation. As discussed previously in this
proposed rule, we are proposing to address State processes for setting
payment rates by amending existing regulations at Sec. 447.203, Sec.
447.204, and Sec. 447.205. Together, these changes better inform
States and CMS on beneficiary access as States develop their service
delivery and payment policies and potentially implement initiatives to
address access issues.
A. Documentation of Access to Care and Service Payment Rates
The proposed revisions at Sec. 447.203(b) would require State
Medicaid agencies to demonstrate access to care by considering:
Enrollee needs, the availability of care and providers, and the
utilization of services. We believe that the experiences of
beneficiaries should be a primary determinant of whether access is
sufficient and we are soliciting public comments that will serve to
help States narrow the focus of the data review to core elements that
will demonstrate sufficient access to care. If beneficiaries are able
to gain access to care (as required by the Act as equivalent to the
general population in a geographic area), then clearly the standards of
the Act have been met regardless of other factors, including payment
levels. However, if beneficiaries experience difficulty in scheduling
service appointments or otherwise accessing needed care, then data on
rates of provider participation and retention, analyses of care
delivery systems, as well as other relevant factors, including levels
of payment are important for States to review and potentially adjust.
We have structured this proposed rule to require that States
collect information on each of three parts of the MACPAC-recommended
framework, leaving States the discretion to determine which particular
metrics they can and should examine. However, we are soliciting public
comments as to whether the data review should be required on an ongoing
basis if the beneficiary data demonstrates adequate access to care. In
part, this may depend on how accurate the beneficiary data may be, and
we are particularly interested in public comments on the most reliable
ways to gather beneficiary input across diverse groups of people, some
with significant physical and mental health problems, language and
other barriers.
As proposed, States would be required to review these data elements
on an ongoing basis and specifically with respect to an affected
service prior to submitting a Medicaid SPA that proposes service
payment rate reductions. In terms of the ongoing review, we are
proposing that States
[[Page 26351]]
would develop a schedule for reviewing each covered service at least
once every 5 years, looking at a subset of services each calendar year.
We considered a mandatory schedule for all States to follow to promote
cross State collaborations and so that comparative data would be
available. For example, all States would examine access to physician
services in year one, and hospital services in year two. However, in
this proposed rule, we are allowing States the discretion to determine
the timeline and the organization of the review in recognition of
unique State delivery systems and to allow States to prioritize their
reviews based on their own sense of urgency, potential issues, or
anticipated rate modifications. Further, this proposed rule proposes
that all States have some process in place to hear from beneficiaries
on access issues, for example, beneficiary survey, a hotline, or an
ombudsman that is either internal to the agency or a contracted
community partner. In addition, in this proposed rule, we are proposing
that States set procedures for their review that will be informed by a
public process, to monitor sustained access to care after a rate
reduction is implemented and submit a corrective action plan to CMS to
address access issues within 90 days of their discovery.
The data collection requirements are discussed in the proposed
regulation text at Sec. 447.203(b)(1)(i) through (iii). These
provisions would require States to review and make publically
available, data trends and factors that measure: Enrollee needs,
availability of care and providers, and utilization of services.
Consistent with the statutory requirement, we have proposed that States
review this data by State designated geographic location.
The proposed changes to the regulation text at Sec.
447.203(b)(1)(iii)(B) would require that the review must include: (1)
An estimate of the percentile which Medicaid payment represents of the
estimate average customary provider charges; (2) an estimate of the
percentile which Medicaid payment represents of one, or more, of the
following: Medicare payment rates, the average commercial payment
rates, or the applicable Medicaid allowable cost of the services, and
(3) an estimate of the composite average percentage increase or
decrease resulting from any proposed revision in payment rates. We have
developed this list of comparable payment structures based on our
experience in how States set rates and the availability of the data in
the interest of easing the administrative burden associated with the
data collection effort. In our experience, most States set Medicaid
rates based on one of the three above-noted structures to which we are
requiring a comparison and the comparable data should be easily
obtained. We believe that the payment comparisons are consistent with
the MACPAC-recommended framework and particularly may be informative of
the availability of providers, though as discussed, may not be the
primary indicator or provider participation. We are soliciting public
comments on these measures.
We have further clarified the regulation text, at Sec.
447.203(b)(1)(iii)(B)(3), to state that the Medicaid payment rates must
include both base and supplemental payments for Medicaid services. It
is important to include supplemental payments because the supplements
are tied to the provision of a Medicaid service and will more
accurately reflect total provider reimbursement. Should States target a
subset of providers with supplemental payments, this should be noted
and the targeted amounts recorded in the methodology required at Sec.
447.203(b)(1)(iii)(B). Since States often reimburse service providers
according to different payment schedules based on governmental status,
we have included a provision at Sec. 447.203(b)(1)(iii)(C) that has
States stratify the access review data by State government owned or
operated, non-State government owned or operated and private providers.
Presenting the data in this manner should inform States as to whether
payments are consistent with efficiency, economy, and quality and
sufficient to enlist providers consistent with the availability of care
and services in the geographic area.
In the proposed regulation text at Sec. 447.203(b)(1)(iii)(D), we
have described the minimum content that must be included in the rate
review. Specifically, we require that States describe the measures that
were used to conduct the review and their relationship to enrollee
needs, the availability of care and providers, service utilization and
Medicaid payment rates as compared to other payment structures. We also
require that States discuss any access issues that were discovered as a
result of the review and the State agency's recommendation on the
sufficiency of access to care based on the data review.
The proposed regulation text at Sec. 447.203(b)(2) describe the
timeframe for States to conduct the data review and make the
information available to the public through accessible public records
or web sites on an on-going basis for all covered services. We propose
such annual reviews begin no later than 2013, so that States would have
the discretion to determine a timeframe to review each covered Medicaid
service, as long as the State reviews a subset of services each year
and each covered service is reviewed at least once every 5 years. We
provided States this 5-year cycle to reduce the burden while
accommodating the need for review to assure compliance with section
1902(a)(30)(A) of the Act.
Because of the need to demonstrate service access in the context of
a payment rate reduction, we describe at Sec. 447.203(b)(3)(i) that
States will need to conduct its review relevant to the affected service
prior to submission of a State plan amendment implementing a reduction.
We believe this is appropriate so that States consider the impact that
such proposals may have on access to care and demonstrate compliance
with section 1902(a)(30)(A) of the Act. If the State has already
reviewed access relating to the types of services that are subject to
the rate reduction within 12 months prior to the proposed rate
reduction, and maintains an ongoing monitoring mechanism with respect
to beneficiary complaints, its review relative to the rate reduction
can reference the previous review.
In order to ensure sustained access to care, we have included
provisions at Sec. 447.203(b)(3)(ii) that require States to develop
ongoing monitoring procedures through which they periodically review
indices to measure sustained access to care. The periodic reviews helps
a State to fulfill its ongoing responsibility to assure access to
covered services consistent with the Act and forms a solid, informed
basis by which a State and CMS can consider how any proposed changes
might impact access. Along with monitoring the review data, it is
important for States to continue to engage beneficiaries to understand
their concerns and access issues on an ongoing basis. We have proposed
to require States to have a mechanism for beneficiary input on access
to care, such as hotlines, surveys, ombudsman or other equivalent
mechanisms, at Sec. 447.203(b)(4). Additionally, proposed regulation
text at Sec. 447.203(b)(5) would institute a corrective action
procedure requiring States to submit a remediation plan should access
issues be discovered through the access review or monitoring processes.
These requirements intend to ensure that States will oversee and
address any future access concerns.
After careful consideration, we developed the data elements
discussed in this provision based on coordination with our Federal
partners, in light of the MACPAC-recommended three-part
[[Page 26352]]
approach, and in an effort to minimize the administrative burden
associated with the requirement. Though we recognize that no
methodology to gauge access to care is flawless, we believe that these
measures are appropriate to inform whether the Medicaid access
requirements are met and that the MACPAC-recommended framework has been
developed after study and based on public and expert input. We are
soliciting public comments and alternatives to the framework and data
elements that we have proposed in this proposed rule, the timeline for
the data review and the process for monitoring and remediating access
issues.
We note that the data analysis activities are claimable as
administrative claiming activities, and reimbursable at the general 50
percent FFP rate for administrative expenditures, insofar as they are
necessary for the proper and efficient administration of the Medicaid
State plan, as described at section 1903(a)(7) of the Act. More
specifically, utilization review is identified as an allowable Medicaid
administrative activity in guidance that we issued in a State Medicaid
Director Letter dated December 20, 1994. We also believe that States
may be collecting some of this information as part of current review
efforts for various purposes, including program administration and
oversight, quality activities, integrity and payment, and are likely to
be collecting such information by 2014 as part of other performance
standards and measures required under the Affordable Care Act.
B. Medicaid Provider Participation and Public Process To Inform Access
to Care
Regulations at Sec. 447.204 implement the statutory requirement
that Medicaid rates must be consistent with efficiency, economy, and
quality and sufficient to enlist enough providers so that services
under the plan are available to beneficiaries at least to the extent
that those services are available to the general population. As
discussed, the sufficiency requirement has been difficult to measure
due to lack of consistent data, variables in delivery systems, and
inconsistent State approaches to involving stakeholders in the rate
development process.
To address these issues, we are proposing to amend the regulation
text at Sec. 447.204(a)(1) through (a)(2) to require that States
consider, when proposing to reduce or restructure Medicaid payment
rates, the data collected through the proposed requirement at Sec.
447.203 and undertake a public process that solicits input on the
potential impact of the proposed reduction of Medicaid service payment
rates on beneficiary access to care. We have also clarified, at Sec.
447.204(b) that we may disapprove a proposed rate reduction or
restructuring SPA that does not include or consider the data review and
a public process. As an alternative, we may take a compliance action,
in accordance with regulation text at 42 CFR 430.35 in these instances.
C. Public Notice of Changes in Statewide Methods and Standards for
Setting Payment Rates
We are also taking this opportunity to propose clarifying and
modernizing changes the public notice requirement at Sec. 447.205. The
substance of the notice is not affected by this action. However, a few
States have expressed confusion in the past as to when a notice is
required insofar as the current regulation calls for notice of
``significant'' changes in payment methods and standards. At this time
we are soliciting public comments on whether it is advisable to delete
the term ``significant'' from the paragraph at Sec. 447.205(a) and
explicitly state that notice is required for any change in rates.
Alternatively, we are soliciting comments on whether to adopt a
threshold for significance and what that threshold might be.
Further, we are proposing to recognize electronic publication as an
optional means of publishing payment notice. To do so, we are adding
Sec. 447.205(d)(iv), which would allow notice to be published on a web
site developed and maintained by the single State Medicaid Agency or
other responsible State agency that is accessible to the general public
on the Internet.
Given the dynamic nature of electronic media, we are proposing the
following requirements for Internet notices: The notices are published
on a regular and known basis; the issued notice includes the date that
it was released to the public on the web site, and that the content of
the notice is not altered after the initial publication. Based on
discussions with States, we believe this will reduce State costs and
allow for a more efficient means to notify the public of changes to
Medicaid payment methods and standards.
VI. Collection of Information Requirements
Under the Paperwork Reduction Act of 1995, we are required to
provide 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
the Office of Management and Budget (OMB) for review and approval. In
order to fairly evaluate whether an information collection should be
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act
of 1995 requires that we solicit comment on the following issues:
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
We are soliciting public comment on each of these issues for the
following sections of this document that contain information collection
requirements (ICRs):
A. ICRs Regarding Documentation of Access to Care and Service Payment
Rates (Sec. 447.203(b))
Section 447.203(b) would require that States review and make public
information that demonstrates sufficient Medicaid access to care,
through a review of: Enrollee needs, the availability of care and
providers, utilization of services and service payment rates. States
would also be required under this provision to monitor data and
beneficiary input on an ongoing basis and address known access issues
through corrective action. Through this proposed rule, we would provide
States with the discretion to determine appropriate data sources that
will be used to conduct the review. We believe that most of the data
that will be used to inform access is available to States and may
already be collected by States as part of Medicaid program reviews and
payment rate-setting procedures. We also note that States would have
flexibility to compare Medicaid rates to one or more of Medicare rates,
commercial rates, or Medicaid cost, as may be appropriate to the
service under review. The burden associated with these requirements
would be time and effort associated with analyzing this information,
making it available to the public, and periodically updating the
information relative to activities States are already undertaking. We
have attempted to mitigate any new burden associated with this section
by identifying data that States are likely to currently possess, by
identifying other data sources that might be informative to State
access reviews, and by phasing in the broader service review over 5-
year intervals.
[[Page 26353]]
1. Access to Care Review Timeline
Section 1902(a)(30)(A) of the Act requires that States ensure that
access to care is available to Medicaid beneficiaries equivalent to
care provided to the general population in a geographic area. Since
this obligation is ongoing and service access may change over time,
Sec. 447.203(b)(2) requires that States conduct their reviews for a
subset of services each calendar year and review all covered Medicaid
services at least once every 5 years. States would have the discretion
to determine the appropriate services to review each year over the 5-
year period in order to manage their review priorities and resources.
As an exception to the 5-year timeline, Sec. 447.203(b)(3)(i) would
require States to conduct the access review in the context of a SPA to
reduce payment rates or restructure provider payments in circumstance
when the resulting changes could create access issues prior to the
submission of a SPA that implements the changes. In this way, States
would consider the impact that such proposals may have on access to
care and demonstrate compliance with section 1902(a)(30)(A) of the Act.
States may complete this review within the prior 12 months of the SPA
submission.
2. Access to Care Review Framework
The data analysis activities described under the proposal are
claimable as administrative claiming activities, and reimbursable at
the general 50 percent FFP rate for administrative expenditures,
insofar as they are necessary for the proper and efficient
administration of the Medicaid State plan, as described at section
1903(a)(7) of the Act. More specifically, utilization review is
identified as an allowable Medicaid administrative activity in guidance
that we issued in a State Medicaid Director Letter dated December 20,
1994. We also believe that States may be collecting some of this
information as part of current review efforts for various purposes,
including program administration and oversight, quality activities,
integrity and payment, and are likely to be collecting such information
by 2014 as part of other performance standards and measures required
under the Affordable Care Act.
The provisions at Sec. 447.203(b)(1) through (3) would require
States to review and make publically available, data trends and factors
that measure: Enrollee needs, availability of care and providers,
utilization of services, and service payment information. Consistent
with the statutory requirement, we have proposed that States review
this data by State designated geographic location. After careful
consideration, we developed the review framework based on coordination
with our Federal partners, in light of the MACPAC-recommended three-
part approach, and in an effort to minimize the administrative burden
associated with the requirement. Though we recognize that no
methodology to gauge access to care is flawless, we believe that the
framework, as supported by State data sources, are appropriate to
inform whether the Medicaid access requirements are met.
Section 447.203(b)(1)(iii)(B) would require that the review
include: (1) An estimate of the percentile which Medicaid payment
represents of the estimate average customary provider charges; (2) an
estimate of the percentile which Medicaid payment represents of one, or
more, of the following: Medicare payment rates, the average commercial
payment rates, or the applicable Medicaid allowable cost of the
services; and (3) an estimate of the composite average percentage
increase or decrease resulting from any proposed revision in payment
rates. We have developed this list of comparable payment structures
based on our experience in how States set rates and the availability of
the data in the interest of easing the administrative burden associated
with the data collection effort. In our experience, most States set
Medicaid rates based on one of the three above-noted structures and the
comparable data should be easily obtained. We believe that the payment
comparisons are consistent with the MACPAC-recommended framework and
particularly may be informative of the availability of providers,
though as discussed, may not be the primary indicator or provider
participation.
In Sec. 447.203(b)(1)(iii)(B)(3), we clarified that both base and
supplemental payments for Medicaid services must include supplemental
payments because the supplements are tied to the provision of a
Medicaid service and will more accurately reflect total provider
reimbursement. Should States target a subset of providers with
supplemental payments, this should be noted and the targeted amounts
recorded in the methodology required at Sec. 447.203(b)(1)(iii)(B).
Since States often reimburse service providers according to
different payment schedules based on governmental status, we have
included a provision at Sec. 447.203(b)(1)(iii)(C) that has States
stratify the access review data by State government owned or operated,
non-State government owned or operated and private providers.
Presenting the data in this manner should inform States as to whether
payments are consistent with efficiency, economy, and quality and
sufficient to enlist providers consistent with the availability of care
and services in the geographic area.
In Sec. 447.203(b)(1)(iii)(D), we describe the minimum content
that must be in included in the rate review. Specifically, we require
that States describe the measures that were used to conduct the review
and their relationship to enrollee needs, the availability of care and
providers, service utilization and Medicaid payment rates as compared
to other payment structures. We also require that States discuss any
access issues that were discovered as a result of the review and the
State agency's recommendation on the sufficiency of access to care
based on the data review.
Section 447.203(b)(2) describes the timeframe for States to conduct
the data review and make the information available to the public
through accessible public records or web sites on an on-going basis for
all covered services. We propose such annual reviews begin no later
than 2013, so that States would have the discretion to determine a
timeframe to review each covered Medicaid service, as long as the State
reviews a subset of services each year and each covered service is
reviewed at least once every 5 years. We provided States this 5-year
cycle to reduce the burden while accommodating the need for review to
assure compliance with section 1902(a)(30)(A) of the Act.
We estimate that the requirements to review and make publically
available, data trends and factors that measure: Enrollee needs,
availability of care and providers, utilization of services, and
Medicaid rate comparisons under Sec. 447.203(b)(1) through (3) would
affect all States. We have allowed States the flexibility to choose the
services that they review annually based on available resources and
State priorities. As such, we assume that States will conduct reviews
in the context of rate reductions or restructuring payment rates as
part of their annual ongoing reviews and we consider the burden
associated with rate reduction reviews as part of the ongoing estimate
burden.
An employee equivalent to the Federal Salary Classification of GS
13 Step 1 could be responsible for gathering review data and developing
and publishing the content of the data review. An employee equivalent
to the Federal Salary Classification of a GS 15 Step 1 would be
responsible for overseeing and approving the data
[[Page 26354]]
review. We have taken these employee assumptions and utilized the
corresponding employee hourly rates for the locality pay area of
Washington, DC as published by the U.S. Office of Personnel Management,
to calculate our cost estimates. We have also calculated the cost by
assuming that a State expends 36 percent of an employee's hourly wages
on benefits for the employee. We have concluded that a 36 percent
expenditure on benefits is an appropriate estimate because it is the
routine percentage used by HHS for contract cost estimates. Our
calculations are expressed in Tables 1 and 2.
Table 1--Access Data Review: Burden per State
[Annual]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cost of
Employee employee Cost per data
Proposed requirement Employee equivalent Burden hours hourly wage benefits per review
rate hour
--------------------------------------------------------------------------------------------------------------------------------------------------------
Gathering Review Data....................... GS 13 Step 1.............................. 160 $42.66 $15.35 $9,281.60
Developing Content of Review................ GS 13 Step 1.............................. 100 42.66 15.35 5,801.00
Publishing Content of Review................ GS 13 Step 1.............................. 40 42.66 15.35 2,320.40
Reviewing and Approving Review.............. GS 15 Step 1.............................. 10 59.30 21.35 806.50
---------------------------------------------------------------
Total Burden per State.................. .......................................... 310 .............. .............. 18,209.50
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 2--Access Data Review: Total Burden
[Annual]
----------------------------------------------------------------------------------------------------------------
Cost of review Total cost
Anticipated number of State reviews Total hours per State estimate ($)
----------------------------------------------------------------------------------------------------------------
50..................................................... 15,500 $18,209.50 $910,475.00
----------------------------------------------------------------------------------------------------------------
B. ICRs Regarding Monitoring Access (Sec. 447.203(b)(3)(ii))
Section 447.203(b)(3)(ii) would require States to develop ongoing
monitoring procedures after reducing or restructuring payments through
which they periodically review measures of sustained access to care for
the affected service(s). The periodic reviews are intended to help a
State fulfill its ongoing responsibility to assure access to covered
services consistent with the Act and form a solid, informed basis by
which a State and CMS can consider how any proposed changes might
affect access. Along with monitoring the review data, it is important
for States to continue to engage beneficiaries to understand their
concerns and access issues on an ongoing basis.
We estimate that the requirement under Sec. 447.203(b)(3)(ii)
would affect all States that implement a rate reduction or restructure
payment rates. We are estimating that approximately 22 States will
implement these rate changes based on the number of States that
proposed such reductions in FY 2010. An employee equivalent to the
Federal Salary Classification of a GS 13 Step 1 could develop the
monitoring procedures and periodically review the monitoring results.
An employee equivalent to the Federal Salary Classification of a GS 15
Step 1 would be responsible for overseeing and approve the monitoring
process. We have taken these employee assumptions and utilized the
corresponding employee hourly rates for the locality pay area of
Washington, DC as published by the U.S. Office of Personnel Management,
to calculate our cost estimates. We have also calculated the cost by
assuming that a State expends 36 percent of an employee's hourly wages
on benefits for the employee. We have concluded that a 36 percent
expenditure on benefits is an appropriate estimate because it is the
routine percentage used by HHS for contract cost estimates. Our
calculations are expressed in Tables 3 and 4.
Table 3--Access Monitoring Procedures: Burden per State
[Annual]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cost of
Employee employee Cost per data
Proposed requirement Employee equivalent Burden hours hourly wage benefits per review
rate hour
--------------------------------------------------------------------------------------------------------------------------------------------------------
Develop Monitoring Procedures............... GS 13 Step 1.............................. 40 $42.66 $15.35 $2,320.40
Periodically Review Monitoring Results...... GS 13 Step 1.............................. 24 42.66 15.35 1,392.24
Approve Monitoring Procedures............... GS 15 Step 1.............................. 3 59.30 21.35 241.95
---------------------------------------------------------------
Total Burden per State.................. .......................................... 67 .............. .............. 3,954.59
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 26355]]
Table 4--Access Monitoring Procedures: Total Burden
[Annual]
----------------------------------------------------------------------------------------------------------------
Cost of review Total cost
Anticipated number of State reviews Total hours per State estimate ($)
----------------------------------------------------------------------------------------------------------------
22..................................................... 1,474 $3,954.59 $87,000.98
----------------------------------------------------------------------------------------------------------------
C. ICRs Regarding Beneficiary Feedback (Sec. 447.203(b)(4))
Section 447.203(b)(4) would require States to have a mechanism for
obtaining beneficiary feedback on access to care, such as hotlines,
surveys, ombudsman or other equivalent mechanisms.
We estimate that the requirement under Sec. 447.203(b)(4) would
affect all States that do not currently have a means of beneficiary
feedback. Since we currently do not know which States have implemented
these mechanisms, we are assuming in our estimate that all States will
need to develop new mechanisms. An employee equivalent to the Federal
Salary Classification of a GS 9 Step 1 could develop and oversee the
feedback effort. An employee equivalent to the Federal Salary
Classification of a GS 15 Step 1 would be responsible for approving the
feedback effort. We have taken these employee assumptions and utilized
the corresponding employee hourly rates for the locality pay area of
Washington, DC as published by the U.S. Office of Personnel Management,
to calculate our cost estimates. We have also calculated the cost by
assuming that a State expends 36 percent of an employee's hourly wages
on benefits for the employee. We have concluded that a 36 percent
expenditure on benefits is an appropriate estimate because it is the
routine percentage used by HHS for contract cost estimates. Our
calculations are expressed in Tables 5 and 6.
Table 5--Beneficiary Feedback Mechanism: Burden per State
[Annual]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cost of
Employee employee Cost per data
Proposed requirement Employee equivalent Burden hours hourly wage benefits per review
rate hour
--------------------------------------------------------------------------------------------------------------------------------------------------------
Developing Feedback Effort.................. GS 9 Step 1............................... 100 $24.74 $8.90 $3,364.00
Monitoring Feedback Results................. GS 9 Step 1............................... 24 24.74 8.90 807.36
Approve Feedback Effort..................... GS 15 Step 1.............................. 5 59.30 21.35 403.25
---------------------------------------------------------------
Total Burden per State.................. .......................................... 129 .............. .............. 4,574.61
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 6--Beneficiary Feedback Mechanism: Total Burden
[Annual]
----------------------------------------------------------------------------------------------------------------
Cost of review Total cost
Anticipated number of State reviews Total hours per State estimate ($)
----------------------------------------------------------------------------------------------------------------
50..................................................... 6,450 $4,574.61 $228,730.50
----------------------------------------------------------------------------------------------------------------
D. ICRs Regarding Corrective Action Plan (Sec. 447.203(b)(5))
Section 447.203(b)(5) would institute a corrective action procedure
that requires States to submit to CMS a remediation plan should access
issues be discovered through the access review or monitoring processes.
The requirement is intended to ensure that States will oversee and
address any future access concerns.
We estimate that the requirement under Sec. 447.203(b)(5) would
affect all States that identify access issues. We are estimating that
approximately 10 States will identify access issues and submit
corrective action plans to CMS. This is a new requirement and we have
no basis to determine how many States will identify access issues as
they conduct the data reviews and monitoring activities. We assume that
many States currently have mechanisms in place to monitor access to
care and identify issues. However, we are careful not to under-estimate
the burden associated with this provision and we believe that a maximum
of 10 States may identify access issues per year. An employee
equivalent to the Federal Salary Classification of a GS 13 Step 1 could
identify issues that require corrective action and develop the plan to
submit to CMS. An employee equivalent to the Federal Salary
Classification of a GS 15 Step 1 would be responsible for review and
approving the plan. We have taken these employee assumptions and
utilized the corresponding employee hourly rates for the locality pay
area of Washington, DC as published by the U.S. Office of Personnel
Management, to calculate our cost estimates. We have also calculated
the cost by assuming that a State expends 36 percent of an employee's
hourly wages on benefits for the employee. We have concluded that a 36
percent expenditure on benefits is an appropriate estimate because it
is the routine percentage used by HHS for contract cost estimates. Our
calculations are expressed in Tables 7 and 8.
[[Page 26356]]
Table 7--Corrective Action Plan: Burden per State
[Annual]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cost of
Employee employee Cost per data
Proposed requirement Employee equivalent Burden hours hourly wage benefits per review
rate hour
--------------------------------------------------------------------------------------------------------------------------------------------------------
Identifying Issues for Action............... GS 13 Step 1.............................. 20 $42.66 $15.35 $1,160.20
Developing the Corrective Plan.............. GS 13 Step 1.............................. 40 42.66 15.35 2,320.40
Approve Corrective Plan..................... GS 15 Step 1.............................. 3 59.30 21.35 241.95
---------------------------------------------------------------
Total Burden Per State.................. .......................................... 63 .............. .............. $3,722.55
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 8--Corrective Action Plan: Total Burden
[Annual]
----------------------------------------------------------------------------------------------------------------
Cost of review Total cost
Anticipated number of state reviews Total hours per state estimate ($)
----------------------------------------------------------------------------------------------------------------
10..................................................... 630 $3,722.55 $37,225.50
----------------------------------------------------------------------------------------------------------------
E. ICRs Regarding Public Process to Engage Stakeholders (Sec. 447.204)
Section 447.204 implements the statutory requirement specifying
that Medicaid rates must be consistent with efficiency, economy, and
quality and must also be sufficient to enlist enough providers so that
services under the plan are available to beneficiaries at least to the
extent that those services are available to the general population. As
discussed in section I. of this proposed rule, the sufficiency
requirement has been difficult to measure due to lack of consistent
data, variables in delivery systems, and inconsistent State approaches
to involving stakeholders in the rate development process.
To address these issues, Sec. 447.204(a)(1) and (a)(2) would
require that States consider (when proposing to reduce Medicaid payment
rates) the data collected through Sec. 447.203 and undertake a public
process that solicits input on the potential impact of the proposed
reduction or restructuring of Medicaid service payment rates on
beneficiary access to care. We have also clarified, at Sec. 447.204(b)
that we may disapprove a proposed rate reduction or restructuring SPA
that does not include or consider the data review and a public process.
As an alternative, we may take a compliance action, in accordance with
regulation text at Sec. 430.35 in these instances.
We are estimating that approximately 22 States will implement these
rate changes that would require a public process based on the number of
States that proposed such reductions in FY 2010. An employee equivalent
to the Federal Salary Classification of a GS 9 Step 1 could develop and
oversee the public process effort. An employee equivalent to the
Federal Salary Classification of a GS 15 Step 1 would be responsible
for approving the public process effort. We have taken these employee
assumptions and utilized the corresponding employee hourly rates for
the locality pay area of Washington, DC as published by the U.S. Office
of Personnel Management, to calculate our cost estimates. We have also
calculated the cost by assuming that a State expends 36 percent of an
employee's hourly wages on benefits for the employee. We have concluded
that a 36 percent expenditure on benefits is an appropriate estimate
because it is the routine percentage used by HHS for contract cost
estimates. Our calculations are expressed in Tables 9 and 10.
Table 9--Public Process: Burden per State
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cost of
Employee employee Cost per data
Proposed requirement Employee equivalent Burden hours hourly wage benefits per review
rate hour
--------------------------------------------------------------------------------------------------------------------------------------------------------
Develop the Public Process.................. GS 9 Step 1............................... 20 $24.74 $8.90 $672.80
Oversee the Public Process.................. GS 9 Step 1............................... 40 24.74 8.90 1345.60
Approve Public Process...................... GS 15 Step 1.............................. 3 59.30 21.35 241.95
---------------------------------------------------------------
Total Burden Per State.................. .......................................... 63 .............. .............. 2,260.35
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 10--Public Process: Total Burden
[Annual]
----------------------------------------------------------------------------------------------------------------
Cost of review Total cost
Anticipated number of state reviews Total hours per state estimate ($)
----------------------------------------------------------------------------------------------------------------
22..................................................... 1,386 $2,260.35 $49,727.70
----------------------------------------------------------------------------------------------------------------
[[Page 26357]]
F. ICRs Regarding Public Notice of Changes in Statewide Methods and
Standards for Setting Payment Rates (Sec. 447.205)
The proposed provisions at Sec. 447.205 would clarify when States
must issue public notice to providers and would allow for the
electronic publication of those notices. Section 447.205(d)(2)(iv)(A)
through (C) would allow those notices to be published on the single
State Medicaid Agency or other State developed and maintained web site
that is accessible to the general public via the Internet.
The burden associated with developing and issuing public notice at
Sec. 447.205 is not affected by this proposed action since the
revision would simply allow for an additional (in this case,
electronic) means of notification. Consequently, we do not include the
electronic notice activity in our burden analysis.
[[Page 26358]]
[GRAPHIC] [TIFF OMITTED] TP06MY11.000
If you comment on these information collection and recordkeeping
requirements, please do either of the following:
1. Submit your comments electronically as specified in the
[[Page 26359]]
ADDRESSES section of this proposed rule; or
2. Submit your comments to the Office of Information and Regulatory
Affairs, Office of Management and Budget, Attention: CMS Desk Officer,
CMS-2328-P Fax: (202) 395-6974; or Email: [email protected]
VII. Response to Comments
Because of the large number of public comments we normally receive
on Federal Register documents, we are not able to acknowledge or
respond to them individually. We will consider all comments we receive
by the date and time specified in the DATES section of this preamble,
and, when we proceed with a subsequent document, we will respond to the
comments in the preamble to that document.
VIII. Regulatory Impact Statement
A. Statement of Need
This proposed rule would revise regulatory provisions in Sec.
447.203 and Sec. 447.204 to create a standardized, transparent process
for States to follow as part of their broader efforts to assure that
payments are consistent with efficiency, economy, and quality of care
and are sufficient to enlist enough providers so that care and services
are available to the general population in the geographic area, as
required by section 1902(a)(30)(A) of the Act. This proposed rule would
also clarify and amend the regulations at Sec. 447.205, which require
States to issue public notice to their providers when changing Medicaid
payment methods and standards. The proposed changes to the public
notice requirement intend to alleviate confusion on when States must
issue notice to providers and recognize electronic media as a means to
issue the notices.
B. Overall Impact
We have examined the impacts of this rule as required by Executive
Order 12866 on Regulatory Planning and Review (September 30, 1993),
Executive Order 13563 on Improving Regulation and Regulatory Review
(January 18, 2011), the Regulatory Flexibility Act (RFA)) (September
19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act,
section 202 of the Unfunded Mandates Reform Act of 1995 (March 22,
1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4,
1999), and the Congressional Review Act (5 U.S.C. 804(2)).
Executive Order 12866 and 13563 direct agencies to assess all costs
and benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
significant effects ($100 million or more in any 1 year). We do not
believe that there is potential for this provision to surpass the
threshold for economic significance because the proposed data analysis
effort is generally consistent with current State oversight and review
activities and States have flexibility within the reviews to use their
existing data or build upon that data when reviewing access to care.
In fact, the guidance provided under the proposal intends to focus
disparate State efforts in monitoring and overseeing data and
beneficiary concerns, which offers a clear framework to comply with
section 1902(a)(30)(A) of the Act. In the absence of Federal guidance,
States have likely misspent resources in efforts to interpret and
comply with section 1902(a)(30)(A) of the Act. We will also make every
effort, in collaboration with State and Federal partners, to identify
resources and tools that States may use to review and monitor access to
care within their State Medicaid programs. In this proposed rule, we
are soliciting public comments to begin identifying data sources and
will continue to provide assistance as States develop their reviews and
monitoring procedures.
We estimate that even if these data collection efforts were, in
fact, totally new to a State and each State were to either bid a
contract to gather and publish the data collection effort and public
process required under this proposed rule or conduct the collection and
public process with State agency resources, the economic effects would
not surpass $100 million or more in any 1 year.
Further, we are not requiring that States directly adjust payment
rates as a result of the provisions of this proposed rule, nor to take
any steps that would not be consistent with efficiency, economy, and
quality of care. Rather, these rules propose to make clear that
beneficiary access must be considered in setting and adjusting payment
methodology for Medicaid services. If a problem is identified, any
number of steps might be appropriate, such as redesigning service
delivery strategies, or improving provider enrollment and retention
efforts. It has always been within the regulatory authority of the CMS
to make SPA approval decisions based on sufficiency of beneficiary
service access and this proposed rule merely provides a more consistent
and transparent way to gather and analyze the necessary information to
support such reviews.
The RFA requires agencies to analyze options for regulatory relief
for small entities, if a rule has a significant impact on a substantial
number of small entities. For purposes of the RFA, small entities
include small businesses, nonprofit organizations, and small government
jurisdictions. Most hospitals and most other providers and suppliers
are small entities, either by nonprofit status or by having revenues of
$7.0 million to $34.5 million in any 1 year. For details, see the Small
Business Administration's Web site at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=2465b064ba6965cc1fbd2eae60854b11&rgn=div8&view=text&node=13:1.0.1.1.16.1.266.9&idno=13. Individuals and States are not included
in the definition of a small entity. We are not preparing an analysis
for the RFA because we and the Secretary have determined that this
proposed rule would not have a significant economic impact on a
substantial number of small entities.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 603 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a Metropolitan
Statistical Area for Medicare payment regulations and has fewer than
100 beds. We are not preparing an analysis for section 1102(b) of the
Act because we and the Secretary have determined that this proposed
rule would not have a significant impact on the operations of a
substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. In 2011, that
threshold is approximately $136 million.
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct requirement costs on State
and local governments, preempts State law, or otherwise has Federalism
implications. Since this regulation does not impose costs above $135
million or more on
[[Page 26360]]
State or local governments, the requirements of E.O. 13132 are not
applicable.
In accordance with the provisions of Executive Order 12866, this
regulation was reviewed by the Office of Management and Budget.
C. Regulatory Alternatives Considered
This section provides an overview of regulatory alternatives that
CMS considered for this proposed rule. In determining the appropriate
approach to guide States in their efforts to meet the requirements of
section 1902(a)(30)(A) of the Act and demonstrate sufficient access to
Medicaid services, we consulted with State Medicaid directors, Federal
agency policy officials and the MACPAC. Based, in part, on these
discussions we arrived at the provisions proposed in this proposed
rule, which seek to balance State obligations to meet the statutory
requirement of section 1902(a)(30)(A) of the Act and potential new
burden associated with the proposal. To achieve this balance, we have
set forth a process that provides a framework for States to demonstrate
access to Medicaid services using available data resources and in
consideration of unique and evolving health care delivery systems. We
have also emphasized the importance of considering beneficiary input in
determining and monitoring access to Medicaid services throughout the
process as discussed in this proposed rule.
1. Access Data Review
The process for documenting access to care and service payment
rates described at Sec. 447.203 would require States to publish access
data reviews that discuss, as recommended by MACPAC, the extent to
which enrollee needs are met, the availability of care and providers,
and changes in beneficiary utilization of covered services. The review
would also include a comparison of Medicaid payment rates to customary
charges and Medicare, commercial payments, or provider cost. The
reviews are to be conducted over 5-year periods for all services
covered in a State's Medicaid State plan or, in the context of a State
plan amendment proposal to reduce provider rates or restructure
provider rates in circumstance that may negatively impact access to
care, within 12 months of implementing the State plan amendment.
As an alternative to the MACPAC-recommended framework for reviewing
access to care, we considered requiring States to report standard data
measures to demonstrate sufficient access to care and section
1902(a)(30)(A) of the Act. We also considered setting national access
thresholds or requiring States to establish and demonstrate access
thresholds. As we have highlighted throughout this proposed rule, there
are no standardized, transparent methodologies for demonstrating access
to care that would be appropriate to adopt at this time. A singular
approach to demonstrating access may not consider differences in
Medicaid benefits and State or local delivery models. For instance, the
appropriate data to measure access to Medicaid long-term care services
provided through personal care providers could be very different from
data used to measure access to acute care services delivered in a
hospital facility that offers outpatient care.
Rather than prescribe data measures that may not align with all
services or set threshold standards, we have adopted the MACPAC-
recommended framework, which sets forth a three-part review that
applies across services and delivery systems and will allow States the
flexibility to determine, through current or new data sources,
appropriate measures of access to care. As States analyze their
existing data sources and those that we identify through work with
MACPAC and our Federal partners, we believe that States may arrive at
best practices for determining sufficient Medicaid access to care which
could be replicated across State delivery systems and will evolve with
new approaches to delivering health care to Medicaid beneficiaries.
2. Access Review Timeframe and Monitoring Procedures
In this proposed rule, we are proposing that access data reviews be
conducted over 5-year periods for all services covered in a State's
Medicaid State plan or, in the context of a provider rate reduction or
restructuring of provider rates that may negatively affect access to
care, within 12 months of implementing the State plan amendment. We
have arrived at the 5-year ongoing review to allow States to determine
the best use of available State resources in conducting the access
review and to prioritize the review in light of program changes or
particular access concerns.
We considered requiring the review on an annual basis or a review
period that is more frequent than 5 years. However, the burden
associated with an annual review would likely be high and may not
demonstrate any changes in access to care if the payment rates and
service delivery systems remain stable. We believe that, absent rate
reductions or restructuring of payments, the 5-year review periods,
combined with ongoing solicitation of information about access from
beneficiaries, are sufficient to identify access issues that may occur
over time, while also allowing the States the flexibility to prioritize
the reviews. We also considered prescribing the services that States
would be required to review each year so that there is national
consistency in the access reviews. However, since the objective of this
proposed rule is to provide States with a framework to demonstrate
access to care consistent with section 1902(a)(30)(A) of the Act rather
than to conduct a national study of access, we determined it
appropriate to allow States the flexibility to choose which services to
review each year based on their priorities.
This proposed rule would require that States develop monitoring
procedures after implementing provider rate reductions or restructuring
rates in ways that may negatively impact access to care. We require
these monitoring procedures because the impact of rate changes on
access to care may not be apparent at the time the changes are adopted.
We considered not requiring States to monitor access after implementing
the changes and to continue to rely on the 5-year reviews to ensure
that access is maintained. However, we believe that it is important for
States to identify and address access issues that arise from specific
SPA actions, such as reimbursement rate reductions.
3. Beneficiary Input on Access to Care
The proposed changes to Sec. 447.203 and Sec. 447.204 emphasize
the importance of involving beneficiaries in determining access issues
and the impact that State rate changes will have on access to care.
Specifically, we require that States implement an ongoing mechanism for
beneficiary input on access to care (through hotlines, surveys,
ombudsman, or another equivalent mechanism) and receive input from
beneficiaries (and affected stakeholders) on the impact that proposed
rates changes will have through a public process. We believe that
beneficiaries' experiences in accessing Medicaid services is the most
important indicator of whether access is sufficient and beneficiary
input will be particularly informative in identifying access issues.
We also considered a requirement that States consult with
beneficiaries when developing their corrective action plans in
instances when the access data reviews or monitoring procedures
identify access issues. While we
[[Page 26361]]
encourage States to solicit beneficiary input on corrective action
plans, we did not make this a specific regulatory requirement and we
leave this to the States' discretion to develop the corrective action
plans as part of their current policy development methods.
List of Subjects in 42 CFR Part 447
Accounting, Administrative practice and procedure, Drugs, Grant
programs--health, Health facilities, Health professions, Medicaid,
Reporting and recordkeeping requirements, and Rural areas.
For the reasons set forth in the preamble, the Centers for Medicare
& Medicaid Services would amend 42 CFR chapter IV as set forth below:
PART 447--PAYMENTS FOR SERVICES
1. The authority citation for part 447 continues to read as
follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
Subpart B--Payment Methods: General Provisions
2. Section 447.203 is amended by--
A. Revising the section heading.
B. Revising paragraph (b).
The revisions read as follows:
Sec. 447.203 Documentation of access to care and service payment
rates.
* * * * *
(b) The agency must record and update, medical assistance access
reviews for each covered benefit, in accordance with timeline describe
in paragraph (c) of this section. Such reviews must be published or
promptly made available upon request to the public and furnished, upon
request, to CMS. The access reviews must include the items specified in
this section, as well as trends and factors, which may vary by
geographic location within the State, which will be used to inform
State policies affecting access to Medicaid services, such as provider
payment rates.
(1) Access review data requirements. States must document in their
access review, using data trends and factors, an analysis that
demonstrates sufficient access to care, considering, at a minimum:
(i) The extent to which enrollee needs are met;
(ii) The availability of care and providers; and
(iii) Changes in beneficiary utilization of covered services. The
access review must also include the following information:
(A) Beneficiary information. Relevant beneficiary information as
described in paragraph (b)(4) of this section.
(B) Access review medicaid payment data. The review must include
all of the following:
(1) An estimate of the percentile, which Medicaid payment
represents of the estimated average customary provider charges.
(2) An estimate of the percentile, which Medicaid payment
represents of one, or more, of the following: Medicare payment rates,
the average commercial payment rates, or the applicable Medicaid
allowable cost of the services.
(3) An estimate of the composite average percentage increase or
decrease resulting from any proposed revision in payment rates. The
review must also include a description of the methods used to make the
estimates described above. The data on Medicaid payment rates must
include all base and supplemental payments to providers described under
the Medicaid State plan.
(C) Stratification requirement. Data on provider payment rates in
the access review must be stratified to the extent that payments vary
by the following categories of providers: State government-owned or
operated, non-State government owned or operated, privately owned or
operated.
(D) Content of the review. The review must, at a minimum, describe:
the specific measures that the State uses to analyze access to care,
how the measures relate to the framework described in paragraph (b)(1)
of this section, any issues with access that are discovered as a result
of the review, and the State agency's recommendations on the
sufficiency of access to care based on the review.
(2) Access review timeframe. Beginning January 1 of the year
beginning no sooner than 12 months after the effective date of the
final rule, for all covered services, the State agency must complete
the access review on a State-determined timeframe, provided that:
(i) The State completes its reviews a subset of services each
calendar year by January 1 of each year;
(ii) All covered services undergo a full review at least once every
5 years; and
(iii) The results of the review are made available to the public
(which could include a web site developed and maintained by the single
State agency or other responsible State agency), and to CMS upon
request through public records.
(3) Special provisions for proposed provider rate reductions or
restructuring--(i) Compliance with access requirements. To demonstrate
compliance with the access requirements at section 1902(a)(30)(A) of
the Act, the State must submit with any State plan amendment that would
reduce provider payment rates or restructure provider payments in
circumstance when the changes could result in access issues, an access
review described under paragraph (b)(1) of this section completed
within the prior 12 months. That access review must demonstrate
sufficient access for any service for which the State agency proposes
to reduce payment rates or restructure provider payments in
circumstance when the changes could result in access issues.
(ii) Monitoring procedures. A State must develop procedures to
monitor continued access to care after implementation of State plan
service rate reduction or payment restructuring. The procedures must
define a periodic review of State determined indices that will serve to
demonstrate sustained service access, consistent with efficiency,
economy, and quality of care.
(4) Mechanisms for ongoing input. States must have ongoing
mechanisms for beneficiary input on access to care (through hotlines,
surveys, ombudsman or another equivalent mechanism), consistent with
the access requirements and public process described in Sec. 447.204
of this subpart. States must maintain a record of the volume and nature
of the response to such input.
(5) Addressing access questions and remediation of access issues.
If a State's access review or monitoring procedures determine access
issues, regardless of whether the issue would indicate non-compliance
with the statutory standard, the State agency is responsible for
submitting a corrective action plan to CMS with specific steps and
timelines to address the issue within 90 days of discovery. While the
corrective action plan may include longer-term measures, the goal for
remediation of the access deficiency should be no longer than 12
months.
3. Section 447.204 is revised to read as follows:
Sec. 447.204 Medicaid provider participation and public process to
inform access to care.
(a) The agency's payments must be consistent with efficiency,
economy, and quality of care and sufficient to enlist enough providers
so that services under the plan are available to recipients at least to
the extent that those services are available to the general population.
In reviewing payment sufficiency, States are required to consider,
prior to the submission of
[[Page 26362]]
any State plan amendment that proposes to reduce or restructure
Medicaid service payment rates:
(1) The data collected through the process described in Sec.
447.203 of this subpart.
(2) Input from beneficiaries and affected stakeholders in
determining the extent of beneficiary access to the affected services
and the impact that the proposed rate change will have, if any, on
continued service access. The State should maintain a record of the
volume and nature of the response to such input.
(b) The State must submit to CMS with any such proposed State plan
amendment, an analysis reflecting consideration of the information and
procedure described in paragraph (a) of this section. If CMS determines
that service rates are modified without such an analysis, the agency
may disapprove a proposed State plan amendment using the authority and
procedures described at part 430 Subpart B of this title or may take a
compliance action using the authority and procedures described at Sec.
430.35 of this title.
4. Section 447.205 is amended by adding paragraph (d)(2)(iv) to
read as follows:
Sec. 447.205 Public notice of changes in Statewide methods and
standards for setting payment rates.
* * * * *
(d) * * *
(2) * * *
(iv) A web site developed and maintained by the single State agency
or other responsible State agency that is accessible to the general
public, provided that:
(A) The site is updated for bulletins on a regular and known basis
(for example, the first day of each month);
(B) The issued notice includes the actual date it was released to
the public on the web site; or
(C) The content of the issued notice is not modified after the
initial publication.
Authority: (Catalog of Federal Domestic Assistance Program No.
93.778, Medical Assistance Program).
Dated: April 13, 2011.
Donald M. Berwick,
Administrator, Centers for Medicare & Medicaid Services.
Approved: April 27, 2011.
Kathleen Sebelius,
Secretary, Health and Human Services.
[FR Doc. 2011-10681 Filed 4-29-11; 4:15 pm]
BILLING CODE 4120-01-P