[Federal Register Volume 84, Number 135 (Monday, July 15, 2019)]
[Proposed Rules]
[Pages 33722-33732]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-14943]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 447

[CMS-2406-P2]
RIN 0938-AT41


Medicaid Program; Methods for Assuring Access to Covered Medicaid 
Services--Rescission

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would remove the regulatory text that sets 
forth the current required process for states to document whether 
Medicaid payments in fee-for-service systems are sufficient to enlist 
enough providers to assure beneficiary access to covered care and 
services consistent with the Medicaid statute. States have raised 
concerns over the administrative burden associated with the current 
regulatory requirements. While we believe the process described in the 
current regulatory text is a valuable tool for states to use to 
demonstrate the sufficiency of provider payment rates, we believe 
mandating states to collect the specific information as described 
excessively constrains state freedom to administer the program in the 
manner that is best for the state and Medicaid beneficiaries in the 
state.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. on September 13, 
2019.

ADDRESSES: In commenting, please refer to file code CMS-2406-P2. 
Because of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    Comments, including mass comment submissions, must be submitted in 
one of the following three 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-2406-P2, 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-2406-P2, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    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 website as soon as possible after they have been 
received: http://www.regulations.gov. Follow the search instructions on 
that website to view public comments.

I. Background

    Section 1902(a)(30)(A) of the Social Security Act (the Act) 
requires states to

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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. In the November 2, 2015 Federal Register (80 FR 
67576), we published the ``Medicaid Program; Methods for Assuring 
Access to Covered Medicaid Services'' final rule with comment period 
(``2015 final rule with comment period'') that outlined a data-driven 
process for states to document their compliance with section 
1902(a)(30)(A) of the Act. The 2015 final rule with comment period 
included a new Sec.  447.203(b)(1) through (8), revisions to Sec.  
447.204, and a new Sec.  447.205(d)(2)(iv). These regulations 
established that states must develop and submit to CMS an access 
monitoring review plan (AMRP), that is updated at least every 3 years, 
for the following services: (1) Primary care (including those provided 
by a physician, federally qualified health center, clinic or dental 
care); (2) physician specialist services (for example, cardiology, 
urology, radiology); (3) behavioral health services (including mental 
health and substance use disorder); (4) pre- and post-natal obstetric 
services, (including labor and delivery); (5) home health services; (6) 
any additional types of services for which a review is required under 
Sec.  447.203(b)(6) because of a proposed payment rate reduction or 
restructuring; (7) additional types of services for which the state or 
CMS has received a significantly higher than usual volume of 
beneficiary, provider or other stakeholder access complaints for a 
geographic area; and (8) additional types of services selected by the 
state.
    Furthermore, under Sec.  447.204(a) through (c), when proposing to 
reduce or restructure Medicaid payment rates, states must consider the 
data collected through the AMRP and undertake a public process that 
solicits input on the potential impact of proposed reduction or 
restructuring of Medicaid payment rates on beneficiary access to care. 
States must submit related analysis to CMS along with any proposed rate 
reduction or restructuring state plan amendment (SPA), and we may 
disapprove such proposed SPA that does not include documentation 
supporting compliance with the required AMRP review and public process. 
Under Sec.  447.204(d), we may take a compliance action against a state 
to remedy an access issue. The initial AMRP submissions were due to us 
on October 1, 2016, as provided in the final rule, ``Medicaid Program; 
Deadline for Access Monitoring Review Plan Submissions,'' published in 
the April 12, 2016 Federal Register (81 FR 21479). We received AMRP 
submissions from all states, and the submissions are available on the 
Medicaid.gov website at https://www.medicaid.gov/medicaid/access-to-care/review-plans/index.html.
    Finally, under Sec.  447.205(d)(2)(iv), states may provide the 
required public notice of any significant proposed change in its 
methods and standards for setting payment rates for services on a state 
public website that meets the standards specified in that paragraph.
    A number of states expressed concern regarding the administrative 
burden associated with the regulatory requirements, particularly those 
states with very high beneficiary enrollment in managed care and a 
correspondingly limited number of beneficiaries receiving care through 
a fee-for-service delivery system. States have mentioned that they must 
utilize a significant amount of staff resources to develop the AMRPs 
and conduct the required analysis when, because of the relatively small 
population in fee-for-service, it will result in program data that is 
not reflective of the state's overall care delivery system and 
therefore is not well suited to evaluating access for the entire 
population of Medicaid beneficiaries in the state. For instance, states 
have discussed that remaining fee-for-service populations are often 
dually eligible for Medicare and Medicaid with Medicaid only being the 
secondary payer for most services provided to these individuals. 
Similarly, remaining fee-for-service populations may reside in long-
term care facilities and because Medicaid is often the primary payer of 
long-term care services, and as such, typically sets the market for 
these services, the types of data comparisons required by the AMRPs are 
of limited utility. Other populations remaining in fee-for-service may 
have reduced packages of services based on specific needs, and these 
populations are often so small or require such specialized care that 
their needs may not be meaningfully compared to the general population. 
Additionally, some states have noted that their managed care contracts 
require participating providers to also participate in their fee-for-
service program. Even states with limited managed care enrollment have 
raised concerns about what they consider to be burdensome standards and 
unsustainable processes and, through the National Association of 
Medicaid Directors, have requested to work with CMS to develop 
meaningful standards and a process that effectively implements section 
1902(a)(30)(A) of the Act.
    In attempt to address some of the states' concerns regarding undue 
administrative burden, in the March 23, 2018 Federal Register (83 FR 
12696), we published a proposed rule that would have exempted states 
with at least 85 percent of their Medicaid population enrolled in 
comprehensive, risk-based managed care from the regulatory requirements 
in Sec. Sec.  447.203(b)(1) through (6) and 447.204(a) through (c). In 
addition, the proposed rule would have exempted from the regulatory 
requirements in Sec. Sec.  447.203(b)(6) and 447.204(a) through (c) 
state proposals to reduce rates or restructure payments where the 
overall reduction is 4 percent or less of overall spending within the 
affected state plan service category for a single state fiscal year 
(SFY) and 6 percent or less over 2 consecutive SFYs. In the responses 
that we received during the public comment period, an overwhelming 
number of commenters raised concerns that the exemption thresholds were 
arbitrarily set without data to support them. While we maintain that 
the thresholds are supportable, we have decided not to finalize the 
proposed exemptions, and instead to set out a new approach to 
understanding access and ensuring statutory compliance while 
eliminating unnecessary burden on states.
    We have relied on states to analyze access to care data and develop 
procedures to monitor data through updates to the AMRPs. While the 
AMRPs can serve as an overall structure for states to monitor access 
data, including after rate reductions or restructurings, similar 
information can be presented by states through the SPA submission 
process to demonstrate compliance with the statute without the need to 
develop and maintain AMRPs as currently required under the regulations. 
Additionally, apart from the SPA submission process, states continue to 
be obligated to ensure their rates are sufficient to maintain 
compliance with section 1902(a)(30)(A) of the Act. If the regulatory 
amendments in this proposed rule are finalized, we would expect to 
issue subregulatory guidance concurrently with the publication of the 
final rule through a letter to State Medicaid Directors to provide 
information on data and analysis that states will submit with SPAs to 
support compliance with section 1902(a)(30)(A) of the Act. We 
anticipate that this guidance would provide states flexibility to 
select the types of data they would use to demonstrate the sufficiency 
of payment rates. Such data

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might include: Rate comparisons; ratios of participating providers to 
total providers in the geographic area; ratios of participating 
providers to beneficiaries in the geographic area; available 
transportation in the geographic area; direct comparisons of access for 
Medicaid beneficiaries to that of the general population in the 
geographic area; and provider, beneficiary, and other stakeholder 
complaints and recommendations for resolution of such complaints. We 
expect that the guidance would remind states of their ongoing 
obligation to ensure sufficient payment rates and that they must 
demonstrate with the information they provide through SPAs that the 
proposed rates or rate structure would satisfy the requirements of the 
statute, including section 1902(a)(30)(A) of the Act.
    In addition, in partnership with states, we are renewing our 
efforts and commitment to develop a data-driven strategy to understand 
access to care in the Medicaid program across fee-for-service and 
managed care delivery systems, as well as in home and community-based 
services waiver programs. This new strategy will focus on developing a 
more uniform methodology for analyzing Medicaid access data for all 
states and will be led by us working in partnership with states and 
other stakeholders. We will use this analysis to inform our approval 
decisions and to set out new policies, as necessary, to improve 
beneficiary access to care and services in the Medicaid program. In 
conjunction with the 2015 final rule with comment period, we also 
published a Request for Information (RFI) in the Federal Register (80 
FR 67377) in which we sought public input to inform the potential 
development of standards with regard to Medicaid beneficiaries' access 
to covered services under the Medicaid program. The majority of 
responses to the RFI were supportive of the concept of more 
standardized access measures across states and delivery systems, at 
that time however, we did not believe we had the necessary data at the 
federal level to move forward with developing such measures. Since 
2015, we have improved data available at the federal level through the 
Transformed Medicaid Statistical Information System (T-MSIS), which is 
a significant expansion of the previously available information from 
the Medicaid Statistical Information System (MSIS) and have a better 
understanding of how such data may be used to monitor access in 
Medicaid. Additionally, we have been working extensively with states, 
through a vendor, to identify best practices and develop standardized 
templates that can be used to analyze access. We hope to build upon 
these efforts as part of the new strategy.

II. Provisions of the Proposed Regulations

    We are proposing to remove Sec.  447.203(b), but leave in place the 
requirement in Sec.  447.203(a) for states to maintain documentation of 
payment rates and make that available to us upon request. In addition, 
we propose to remove Sec.  447.204(b) through (c) to remove the 
regulatory requirements for the process states must follow prior to the 
submission of a SPA that proposes to reduce or restructure Medicaid 
service payment rates. We are also proposing to remove Sec.  
447.204(d), which specifies actions we could take to remedy an access 
issue, as this provision was intended to address issues that arose 
based on the state's access monitoring review procedures that we are 
now proposing to no longer require. We would continue to have authority 
to take compliance action or other remedial action if we determine that 
a state is not in compliance with section 1902(a)(30)(A) of the Act. 
The proposal would leave in place the opening sentence of the current 
requirement in Sec.  447.204(a), which is a restatement of the 
statutory language of section 1902(a)(30)(A) of the Act.
    Although this proposed rule would remove the regulatory process 
requirements for states to develop and update an AMRP and to submit 
certain access analysis when proposing to reduce or restructure 
provider payment rates, states still would be obligated by the statute 
to ensure Medicaid payment rates are sufficient to enlist enough 
providers to assure that beneficiary access to covered care and 
services are available under the plan at least to the extent such care 
and services are available to the general population in the same 
geographic area, particularly when reducing or restructuring Medicaid 
payment rates through SPAs. States would still be required to submit 
information and analysis to demonstrate compliance with section 
1902(a)(30)(A) of the Act when submitting payment SPAs, and as 
discussed above, we would expect to issue subregulatory guidance to 
inform states on the types of information and data that we would 
consider to be acceptable.

III. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et 
seq.), 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. To fairly evaluate whether an information 
collection should be approved by OMB, section 3506(c)(2)(A) of the PRA 
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.
    In this proposed rule, we are soliciting public comment on each of 
these issues for the following sections of this rule that would rescind 
certain ``collection of information'' requirements as defined under 5 
CFR 1320.3 of the PRA's implementing regulations.

A. Wage Estimates

    To derive average costs, we used data from the U.S. Bureau of Labor 
Statistics' May 2017 National Occupational Employment and Wage 
Estimates for all salary estimates (http://www.bls.gov/oes/current/oes_nat.htm). Note, this is updated wage information from the currently 
approved information collection request (CMS-10391; OMB 0938-1134), 
which used 2015 National Occupational Employment and Wage Estimates. In 
this regard, Table 1 presents the mean hourly wage, the cost of fringe 
benefits and overhead (calculated at 100 percent of salary), and the 
adjusted hourly wage. This updated adjusted hourly wage information is 
used for all of the estimated burden calculations in this proposed 
rule.

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    We adjusted our employee hourly wage estimates by a factor of 100 
percent. This was necessarily a rough adjustment, both because fringe 
benefits and overhead costs vary significantly from employer to 
employer, and because methods of estimating these costs vary widely 
from study to study. We believe that doubling the hourly wage to 
estimate total cost was a reasonably accurate estimation method.

B. Proposed Information Collection Requirements (ICRs)

    This rule does not propose any new collection of information 
requirements. Instead, in the interest of consistency with Executive 
Order 13771 (January 30, 2017), entitled, ``Reducing Regulation and 
Controlling Regulatory Costs,'' this rule proposes to rescind the 
collection of information requirements and burden that are set out 
under the 2015 final rule with comment period (80 FR 67576). The 
requirements and burden (with modification, as explained below) were 
approved by OMB on April 29, 2016, under control number 0938-1134 (CMS-
10391). As noted previously, while we believe the process described in 
the current regulatory text can be a valuable tool for states to use to 
demonstrate the sufficiency of provider payment rates, because we have 
no basis for determining how many states would continue to follow the 
current AMRP process in whole or in part, we are assuming that all 
states would opt to provide alternate evidence of compliance with 
section 1902(a)(30)(A) of the Act and are therefore removing the burden 
of the current AMRP requirements in its entirety. States were already 
required to submit information on compliance with section 
1902(a)(30)(A) of the Act prior to the 2015 final rule with comment 
period. As the requirements and burden estimate under control number 
0938-1134 (CMS-10391) only accounted for new burden associated with 
2015 final rule with comment period, were are not accounting for burden 
associated overall compliance with section 1902(a)(30)(A) of the Act 
and information states may submit to demonstrate statutory compliance 
as part of the SPA submission process if the proposal to rescind the 
2015 requirements is finalized. Information and documentation states 
submit in support of SPAs are covered within the procedural 
requirements defined in 42 CFR part 430.
1. ICRs Regarding Access Monitoring Review Plans (Sec.  447.203(b))
    Current provisions at Sec.  447.203(b) require that states develop 
and make publicly available an access monitoring review plan that 
considers: Beneficiary needs, availability of care and providers, and 
changes to beneficiary utilization of covered services.
    Section 447.203(b)(1) and (2) describes the minimum factors that 
states must consider when developing an access monitoring review plan, 
while Sec.  447.203(b)(3) requires that states include aggregate 
percentage comparisons of Medicaid payment rates to other public 
(including, as practical, Medicaid managed care rates) or private 
health coverage rates within their state's geographic areas.
    Section 447.203(b)(4) describes the minimum content that must be in 
included in the monitoring plan, including: The measures the state uses 
to analyze access to care issues, how the measures relate to the 
overarching framework, access issues that are discovered as a result of 
the review, and the state Medicaid agency's recommendations on the 
sufficiency of access to care based on the review.
    Section 447.203(b)(5) describes the timeframe for states to develop 
the access monitoring review plan and complete the data review for the 
following categories of services: Primary care, physician specialist 
services, behavioral health, pre- and post-natal obstetric services 
including labor and delivery, home health, any services for which the 
state has submitted a state plan amendment to reduce or restructure 
provider payments which changes could result in diminished access, and 
additional services as determined necessary by the state or CMS. While 
the initial access monitoring review plans have been completed, the 
plan must be updated at least every 3 years, but no later than October 
1 of the update year.
    In our currently approved information collection request (CMS-
10391; OMB 0938-1134), we estimated that the requirements to develop 
and make the access monitoring review plans publicly available under 
Sec.  447.203(b) and (b)(1) through (b)(5) for the specific categories 
of Medicaid services will affect each of the 50 state Medicaid programs 
and the District of Columbia (51 total respondents). Using the 
previously derived estimates of burden hours and updated adjusted 
hourly wage information, we now estimate that it will take: 80 hr at 
$47.14/hr for a research assistant staff to gather data, 80 hr at 
$90.20/hr for an information analyst staff to analyze the data, 100 hr 
at $89.84/hr for management analyst staff to update the content of the 
access review monitoring plan, 40 hr at $70.28/hr for business 
operations specialist staff to publish the access monitoring review 
plan, and 10 hr at $118.70/hr for managerial staff to review and 
approve the access monitoring review plan. A demonstrated below in 
Tables 2A and 2B, we estimate a burden reduction or savings of 15,810 
hr (total) at a cost of $1,222,439 (total) or $23,969 (per state).
    Please note that the 2015 final rule with comment period set out a 
burden of 5,270 hr which divided the total number of respondents (51 
states) across 3 years (17 states per year) to equal 17 states x 310 hr 
per response. In this rule we propose to adjust the number of 
respondents from 17 to 51 to capture the total number of respondents 
across the 3 year period, resulting in a difference of -10,540 hr 
(5,270 hr-15,810 hr).
BILLING CODE 4120-01-P

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    Based on this rule's proposal to rescind the requirement for states 
to update the access monitoring review plan at least every 3 years, we 
are also removing the on-going or annual burden associated with the 
access monitoring review plan. Consistent with our currently approved 
estimates, we believe that the average ongoing burden is likely to be 
the same as the average initial burden since states will need to re-run 
the data, determine whether to add or drop measures, consider public 
feedback, and write-up new conclusions based on the information they 
review.
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2. ICRs Regarding Ongoing Monitoring (Sec.  447.203(b)(6)(ii))
    Section 447.203(b)(6)(ii) requires that states have procedures 
within the access monitoring review plan to monitor continued access 
after implementation of a SPA that reduces or restructures payment 
rates. The monitoring procedures must be in place for a period of at 
least three years following the effective date of the SPA. The ongoing 
burden associated with the requirements under Sec.  447.203(b)(6)(ii) 
is the time and effort it would take each of the state Medicaid 
programs to monitor continued access following the implementation of a 
SPA that reduces or restructures payment rates.
    In our currently approved information collection request (CMS-
10391; OMB 0938-1134), we estimated that in each SPA submission cycle, 
states would submit 22 SPAs to implement rate changes or restructure 
provider payments based on the number of submissions received in FY 
2010.
    Using the previously approved estimates of burden hours and updated 
adjusted hourly wage information, we now estimate that it will take, on 
average: 40 hr at $89.84/hr for management analyst staff to develop the 
monitoring procedures, 24 hr at $89.84/hr for management analyst staff 
to periodically review the monitoring results, and 3 hr at $118.70/hr 
for management staff to review and approve the monitoring procedures. 
As demonstrated below in Tables 4A and 4B, we estimate a burden 
reduction or savings of 1,474 hr (total) at a cost of $134,329 (total) 
or $6,106 (per state).
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3. ICRs Regarding Ongoing Input (Sec.  447.203(b)(7))
    The current provision at Sec.  447.203(b)(7) requires that states 
have a mechanism for obtaining ongoing beneficiary, provider, and 
stakeholder input on access to care issues such as: Hotlines, surveys, 
ombudsman, or other equivalent mechanisms. States must promptly respond 
to public input with an appropriate investigation, analysis, and 
response. They also must maintain records of beneficiary input and the 
nature of the state response.
    In our currently approved information collection request (CMS-
10391; OMB 0938-1134), we estimated that the requirement to develop 
mechanisms for ongoing feedback would affect each of the 50 state 
Medicaid programs and the District of Columbia (51 total respondents).
    Using the previously approved estimates of burden hours and updated 
adjusted hourly wage information, we now also estimate that it would 
take an average of: 100 hr at $89.84/hr for management analyst staff to 
develop the feedback effort and 5 hr at $118.70 for managerial staff to 
review and approve the feedback effort. As demonstrated below in Tables 
5A and 5B, we estimate a burden reduction or savings of 5,355 hr 
(total) at a cost of $488,453 (total) or $9,578 (per state).
    Please note that the 2015 final rule with comment period had set 
out a burden of 1,785 hr which divided the total number of respondents 
(51 states) across 3 years (17 states per year) to equal 17 states x 
105 hr per response. In this rule, we propose to adjust the number of 
respondents from 17 to 51 to capture the total number of respondents 
across the 3-year period, resulting in a difference of -3,570 hr (1,785 
hr-5,355 hr).
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    The ongoing burden associated with the requirements under Sec.  
447.203(b)(7) is the time and effort it would take each of the 50 state 
Medicaid programs and the District of Columbia (51 total respondents) 
to monitor beneficiary feedback mechanisms. The overall effort 
associated with monitoring the feedback is primarily incurred by the 
analysts who will gather, review and make recommendations for and 
conduct follow-up on the feedback. We estimate that it will take an 
average of: 75 hr at $89.84/hr for management analyst staff to monitor 
feedback results and 5 hr at $118.70/hr for managerial staff to review 
and approve the feedback effort. As demonstrated below in Tables 6A and 
6B, we estimate a burden reduction or savings of 4,080 hr (total) at a 
cost of $373,907 (total) or $7,332 (per state).
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4. ICRs Regarding Corrective Action Plan (Sec.  447.203(b)(8))
    Current Sec.  447.203(b)(8) requires that states submit to CMS a 
corrective action plan should access issues be discovered through the 
access monitoring processes.
    In our currently approved information collection request (CMS-
10391; OMB 0938-1134), we estimated that a maximum of 10 states may 
identify access issues per year. The one-time burden is the time and 
effort it would take 10 state Medicaid programs to develop and 
implement corrective action plans.
    Using the previously approved estimates of burden hours and updated 
adjusted hourly wage information, we estimate that it would take an 
average of: 20 hr at $89.84/hr for management analyst staff to identify 
issues requiring corrective action, 40 hr at $89.84/hr for management 
analyst staff to develop the corrective action plans, and 3 hr at 
$118.70/hr for managerial staff to review and approve the corrective 
action plans. As demonstrated below in Tables 7A and 7B, we estimate a 
burden reduction or savings of 630 hr (total) at a cost of $57,465 
(total) or $5,747 (per state).
    Please note that the 2015 final rule with comment period had set 
out a burden of 208 hr which was corrected in the Supporting Statement 
(approved by OMB on February 2, 2016) to reflect 630 hr, resulting in a 
difference of plus 422 hr.
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5. ICRs Regarding Public Process To Engage Stakeholders (Sec.  
447.204(a)(1) and (2))
    Current Sec.  447.204(a)(1) and (2) require that states consider 
(when proposing to reduce or restructure Medicaid payment rates) the 
data collected through current 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.
    In our currently approved information collection request (CMS-
10391; OMB 0938-1134), we estimated that approximately 22 states would 
develop and implement rate changes that would require a public process. 
Using the previously approved estimates of burden hours and updated 
adjusted hourly wage information, we also estimate that it would take 
an average of: 20 hr at $89.84/hr for management analyst staff to 
develop the public process and 3 hr at $118.70/hr for managerial staff 
to review and approve the public process. As demonstrated below in 
Tables 8A and 8B, we estimate a burden reduction or savings of 506 hr 
(total) at a cost of $47,364 (total) or $2,153 (per state).
    Please note that the 2015 final rule with comment period had set 
out a burden of 168 hr which was corrected in the Supporting Statement 
(approved by OMB on February 2, 2016) to reflect 506 hr, resulting in a 
difference of plus 338 hr.
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[[Page 33729]]


    The ongoing burden associated with the current requirements under 
Sec.  447.204 is the time and effort it would take 22 state Medicaid 
programs to oversee a public process. We estimate that it would take an 
average of: 40 hr at $89.84/hr for management analyst staff to oversee 
the public process and 3 hr at $118.70/hr for managerial staff to 
review and approve the public process. As demonstrated below in Tables 
9A and 9B, we estimate a burden reduction or savings of 946 hr (total) 
at a cost of $86,893 (total) or $3,950 (per state).
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C. Summary of Proposed Collection of Information Requirements and 
Burden
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 BILLING CODE 4120-01-C

D. Submission of PRA-Related Comments

    We have submitted a copy of this proposed rule to OMB for its 
review of the rule information collection and recordkeeping 
requirements. The requirements are not effective, if finalized, until 
they have been approved by OMB.
    We invite public comments on these information collection 
requirements, and particularly on submission frequency and burden hours 
per response. If you wish to comment, please identify the rule (CMS-
2406-P2), the CMS ID number (CMS-10391), and the OMB control number 
(0938-1134).
    To obtain copies of a supporting statement and any related forms 
for the proposed collection(s) summarized in this notice, you may make 
your request using one of following:
    1. Access CMS' website address at https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing.html.
    2. Email your request, including your address, phone number, OMB 
control number, and CMS document identifier (CMS-10391), to 
[email protected].
    3. Call the Reports Clearance Office at (410) 786-1326.
    See this rule's DATES and ADDRESSES sections for the comment due 
date and for additional instructions.

IV. 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.

V. Regulatory Impact Statement

A. Statement of Need

    We are concerned about the unnecessary administrative burden 
experienced by state Medicaid agencies in meeting the requirements of 
Sec.  447.203(b)(1) through (8) and Sec.  447.204(b) through (d), when 
we believe that similar information could be presented by states when 
necessary to demonstrate compliance with the statute without the need 
to develop and maintain AMRPs as currently required under the 
regulations. This proposed rule impacts states' documentation of 
compliance with section 1902(a)(30)(A) of the Act and would provide 
burden relief to all states. Although this proposed rule would remove 
the regulatory process requirements for states to develop and update an 
AMRP and to submit an access analysis when proposing to reduce or 
restructure provider payment rates in circumstances that could result 
in

[[Page 33731]]

diminished access, states are still obligated by the statute to ensure 
Medicaid payment rates are sufficient to enlist enough providers to 
assure that beneficiary access to covered care and services are 
available under the plan at least to the extent such care and services 
are available to the general population in the same geographic area, 
particularly when reducing or restructuring Medicaid payment rates 
through SPAs. This proposed rule would not remove, or otherwise limit, 
the states' obligation to comply with the statute, but would allow 
states greater flexibility in the way in which they demonstrate such 
compliance.

B. Overall Impact

    We have examined the impacts of this proposed 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 (Pub. L. 96-
354, enacted on September 19, 1980) (RFA), section 1102(b) of the Act, 
section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, 
enacted on March 22, 1995) (UMRA), Executive Order 13132 on Federalism 
(August 4, 1999), the Congressional Review Act (5 U.S.C. 804(2)) and 
Executive Order 13771 on Reducing Regulation and Controlling Regulatory 
Costs (January 30, 2017).
    Executive Orders 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). Section 
3(f) of Executive Order 12866 defines a ``significant regulatory 
action'' as an action that is likely to result in a rule: (1) Having an 
annual effect on the economy of $100 million or more in any 1 year, or 
adversely and materially affecting a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or state, local or tribal governments or communities (also 
referred to as ``economically significant''); (2) creating a serious 
inconsistency or otherwise interfering with an action taken or planned 
by another agency; (3) materially altering the budgetary impacts of 
entitlement grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (4) raising novel legal or policy 
issues arising out of legal mandates, the President's priorities, or 
the principles set forth in the Executive Order.
    A regulatory impact analysis (RIA) must be prepared for major rules 
with economically significant effects ($100 million or more in any 1 
year). This proposed rule is not economically significant with an 
overall estimated reduced reporting burden of $3,633,289.

C. Anticipated Effects

1. Effects on State Medicaid Programs
    We anticipate effects on state Medicaid programs as they would no 
longer be required to maintain and update the access monitoring review 
plans required under the current regulations. Importantly, the 
provisions of this proposed rule remove the regulatory procedural 
requirements for demonstrating access to care. However, states would 
not be exempt from the statutory requirements under section 
1902(a)(30)(A) of the Act and would continue to be required to ensure 
access is consistent with the Act generally, and especially when 
seeking to reduce or restructure Medicaid payment rates.
2. Effects on Small Business and Providers
    We do not anticipate effects on small businesses and providers 
because states are still required to comply with section 1902(a)(30)(A) 
of the Act and will need to demonstrate such compliance when they 
submit a SPA to reduce or restructure payment rates. We do not 
anticipate our SPA approval decisions will be impacted by removing the 
process requirements included in these regulations, as states will 
still need to demonstrate compliance with the Act.
3. Effects on the Medicaid Program
    The estimated fiscal impact on the Medicaid program from the 
implementation of the proposed rule is estimated to be a net savings to 
Medicaid state agencies. This will have an effect on state 
administrative expenditures, which have been quantified in the 
collection of information requirements described previously in this 
proposed rule. While we acknowledge there will still be some level of 
state administrative burden associated with documenting compliance with 
the statute, we believe it is likely to be significantly less than the 
burden associated with carrying out the procedural requirements 
included in the current regulations, and are seeking comment 
specifically on this issue. We do not anticipate implementing this 
proposed rule would have an impact on a state's Medicaid rates.
    The RFA requires agencies to analyze options for regulatory relief 
of small entities, if a rule has a significant impact on a substantial 
number of small entities. The great majority of hospitals and most 
other health care providers and suppliers are small entities, either by 
being nonprofit organizations or by meeting the SBA definition of a 
small business (having revenues of less than $7.5 million to $38.5 
million in any one year). Individuals and states are not included in 
the definition of a small entity. As previously stated, we do not 
anticipate any effect on 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 and has fewer than 100 beds. This rule will 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 (UMRA) 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 2018, that 
threshold is approximately $150 million. This rule does not contain 
mandates that will impose spending costs on state, local, or tribal 
governments in the aggregate, or by the private sector, in excess of 
the threshold.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it issues a proposed rule that imposes 
substantial direct requirement costs on state and local governments, 
preempts state law, or otherwise has Federalism implications. This rule 
does not have a substantial direct cost impact on state or local 
governments.

D. Alternatives Considered

    We considered, and previously proposed, setting a threshold for 
exemption from certain regulatory requirements for states with at least 
an 85 percent enrollment rate in comprehensive risk-based managed care. 
We also considered setting a threshold for proposed payment rate 
reductions that would be considered ``nominal'' and not subject to 
these regulatory requirements. After further consideration of these 
alternatives, we determined that neither alternative provided 
sufficient administrative

[[Page 33732]]

burden relief for states and that implementing the thresholds could be 
administratively challenging for both states and CMS, particularly in 
marginal cases where the state's managed care enrollment percentage or 
the percentage rate change approached the applicable threshold. 
Therefore, we believe that removing the regulatory requirements is the 
best course of action as we move forward in the development and 
implementation of a comprehensive approach to monitoring access across 
Medicaid delivery systems.

E. Reducing Regulation and Controlling Regulatory Costs

    Executive Order 13771, titled Reducing Regulation and Controlling 
Regulatory Costs, was issued on January 30, 2017. This proposed rule is 
expected to be an E.O. 13771 deregulatory action. We estimate that this 
rule generates $3.63 million in annualized cost savings, discounted at 
7 percent relative to year 2016, over a perpetual time horizon. Details 
on the estimated cost savings of this rule can be found in the 
preceding analyses.

G. Conclusion

    In accordance with the provisions of Executive Order 12866, this 
proposed rule was reviewed by the Office of Management and Budget.

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, Rural areas.

    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services proposes to amend 42 CFR chapter IV as set forth 
below:

PART 447--PAYMENTS FOR SERVICES

0
1. The authority citation for part 447 is revised to read as follows:

    Authority: 42 U.S.C. 1302.


Sec.  447.203   [Amended]

0
2. Section 447.203 is amended by removing and reserving paragraph (b).
0
3. Section 447.204 is revised to read as follows:


Sec.  447.204   Medicaid provider participation and public process to 
inform access to care.

    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 beneficiaries at least to the 
extent that those services are available to the general population in 
the geographic area.

    Dated: January 28, 2019.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.

    Dated: February 13, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human Services.

    Editorial Note: This document was received by the Office of the 
Federal Register on July 10, 2019.
[FR Doc. 2019-14943 Filed 7-11-19; 11:15 am]
BILLING CODE 4120-01-P