[Federal Register Volume 88, Number 85 (Wednesday, May 3, 2023)]
[Proposed Rules]
[Pages 27960-28089]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-08959]
[[Page 27959]]
Vol. 88
Wednesday,
No. 85
May 3, 2023
Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 431, 438, et al.
Medicaid Program; Ensuring Access to Medicaid Services; Proposed Rule
Federal Register / Vol. 88, No. 85 / Wednesday, May 3, 2023 /
Proposed Rules
[[Page 27960]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 431, 438, 441, and 447
[CMS-2442-P]
RIN 0938-AU68
Medicaid Program; Ensuring Access to Medicaid Services
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Proposed rule.
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SUMMARY: This proposed rule takes a comprehensive approach to improving
access to care, quality and health outcomes, and better addressing
health equity issues in the Medicaid program across fee-for-service
(FFS), managed care delivery systems, and in home and community-based
services (HCBS) programs. These proposed improvements seek to increase
transparency and accountability, standardize data and monitoring, and
create opportunities for States to promote active beneficiary
engagement in their Medicaid programs, with the goal of improving
access to care.
DATES: To be assured consideration, comments must be received at one of
the addresses provided below, by July 3, 2023.
ADDRESSES: In commenting, please refer to file code CMS-2442-P.
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-2442-P, P.O. Box 8016,
Baltimore, MD 21244-1850.
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-2442-P, 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:
Karen LLanos, (410) 786-9071, for Medical Care Advisory Committee.
Jennifer Bowdoin, (410) 786-8551, for Home and Community-Based
Services.
Jeremy Silanskis, (410) 786-1592, for Fee-for-Service Payment.
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. CMS will not post on Regulations.gov public
comments that make threats to individuals or institutions or suggest
that the individual will take actions to harm the individual. CMS
continues to encourage individuals not to submit duplicative comments.
We will post acceptable comments from multiple unique commenters even
if the content is identical or nearly identical to other comments.
I. Background
A. Overview
Title XIX of the Social Security Act (the Act) established the
Medicaid program as a joint Federal and State program to provide
medical assistance to eligible individuals, including many with low
incomes. Under the Medicaid program, each State that chooses to
participate in the program and receive Federal financial participation
(FFP) for program expenditures, establishes eligibility standards,
benefits packages, and payment rates, and undertakes program
administration in accordance with Federal statutory and regulatory
requirements. The provisions of each State's Medicaid program are
described in the Medicaid ``State plan'' and, as applicable, related
authorities, such as demonstration projects and waivers of State plan
requirements. Among other responsibilities, CMS approves State plans,
State plan amendments (SPAs), demonstration projects authorized under
section 1115 of the Act, and waivers authorized under section 1915 of
the Act; and reviews expenditures for compliance with Federal Medicaid
law, including the requirements of section 1902(a)(30)(A) of the Act
relating to efficiency, economy, quality of care, and access to ensure
that all applicable Federal requirements are met.
As of December 2022, the Medicaid program provides essential health
care coverage to more than 85 million \1\ individuals, and, in 2021,
accounted for 17 percent of national health expenditures.\2\ The
program covers a broad array of health benefits and services critical
to underserved populations,\3\ including low-income adults, children,
parents, pregnant individuals, older adults, and people with
disabilities. For example, Medicaid pays for approximately 41 percent
of all births in the U.S.\4\ and is the largest payer of long-term
services and supports (LTSS),\5\ the largest, single payer of services
to treat substance use disorders,\6\ and services to prevent and treat
the Human Immunodeficiency Virus.\7\
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\1\ December 2022 Medicaid and CHIP Enrollment Snapshot.
Accessed at https://www.medicaid.gov/medicaid/national-medicaid-chip-program-information/downloads/December-2022-medicaid-chip-enrollment-trend-snapshot.pdf.
\2\ CMS National Health Expenditure Accounts. National Health
Expenditures 2020 Highlight. Accessed at https://www.cms.gov/files/document/highlights.pdf.
\3\ Executive Order 13985: https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
\4\ National Center for Health Statistics. Key Birth Statistics.
Accessed at https://www.cdc.gov/nchs/nvss/births.htm.
\5\ Colello, Kirsten J. Who Pays for Long-Term Services and
Supports? Congressional Research Service. Updated June 15, 2022.
Accessed at https://crsreports.congress.gov/product/pdf/IF/IF10343.
\6\ Soni, Anita. Health Care Expenditures for Treatment of
Mental Disorders: Estimates for Adults Ages 18 and Older, U.S.
Civilian Noninstitutionalized Population, 2019. Statistical Brief
#539, pg 12. February 2022. Agency for Healthcare Research and
Quality, Rockville, MD. Accessed at https://meps.ahrq.gov/data_files/publications/st539/stat539.pdf.
\7\ Dawson, L. and Kates, J. Insurance Coverage and Viral
Suppression Among People with HIV, 2018. September 2020. Kaiser
Family Foundation. Accessed at https://www.kff.org/hivaids/issue-brief/insurance-coverage-and-viral-suppression-among-people-with-hiv-2018/.
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On January 28, 2021, the President signed Executive Order (E.O.)
14009,\8\ ``Strengthening Medicaid and the Affordable Care Act'' which
established the policy objective to protect and strengthen Medicaid and
the Affordable Care Act and to make high-quality health care accessible
and affordable for every American and directed executive departments
and agencies to review existing regulations, orders, guidance
documents, and policies to determine whether such agency actions are
inconsistent with this policy. On April
[[Page 27961]]
5, 2022, E.O. 14070,\9\ ``Continuing To Strengthen Americans' Access to
Affordable, Quality Health Coverage,'' directed Federal agencies with
responsibilities related to Americans' access to health coverage to
review agency actions to identify ways to continue to expand the
availability of affordable health coverage, to improve the quality of
coverage, to strengthen benefits, and to help more Americans enroll in
quality health coverage. This proposed rule aims to fulfill E.O.s 14009
and 14070 by helping States to strengthen Medicaid and improve access
to and quality of care provided.
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\8\ Executive Order 14009: https://www.federalregister.gov/documents/2021/02/02/2021-02252/strengthening-medicaid-and-the-affordable-care-act.
\9\ Executive Order 14070: https://www.federalregister.gov/documents/2022/04/08/2022-07716/continuing-to-strengthen-americans-access-to-affordable-quality-health-coverage.
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Ensuring that beneficiaries can access covered services is
necessary to the basic operation of the Medicaid program. Depending on
the State and its Medicaid program structure, beneficiaries access
their health care services using a variety of care delivery systems
(for example, FFS, fully-capitated managed care, partially capitated
managed care, etc.), including through demonstrations and waiver
programs. In 2020, 70 percent of Medicaid beneficiaries were enrolled
in comprehensive managed care plans; \10\ the remaining individuals
received all of their care or some services that have been carved out
of managed care through FFS.
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\10\ MACPAC 2022 Analysis of T-MSIS data February 2022. Exhibit
30. Percentage of Medicaid Enrollees in Managed Care by State and
Eligibility Group https://www.macpac.gov/wp-content/uploads/2022/12/EXHIBIT-30.-Percentage-of-Medicaid-Enrollees-in-Managed-Care-by-State-and-Eligibility-Group-FY-2020.pdf.
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Current access regulations are neither comprehensive nor consistent
across delivery systems or coverage authority (for example, State plan
and demonstration authority). For example, regulations at 42 CFR
447.203 and 447.204 relating to access to care, service payment rates,
and Medicaid provider participation in rate setting apply only to
Medicaid FFS delivery systems and focus on ensuring that payment rates
are consistent with the statutory requirements in section
1902(a)(30)(A) of the Act. The regulations do not apply to services
delivered under managed care. These regulations are also largely
procedural in nature and rely heavily on States to form an analysis and
reach conclusions on the sufficiency of their own payment rates.
With a program as large and complex as Medicaid, access regulations
need to be multi-factorial to promote consistent access to health care
for all beneficiaries across all types of care delivery systems in
accordance with statutory requirements. Strategies to enhance access to
health care services should reflect how people move through and
interact with the health care system. We view the continuum of health
care access across three dimensions of a person-centered framework: (1)
enrollment in coverage; (2) maintenance of coverage; and (3) access to
services and supports. Within each of these dimensions, accompanying
regulatory, monitoring, and/or compliance actions may be needed to
ensure access to health care is achieved and maintained.
In the spring of 2022, we released a request for information (RFI)
\11\ to collect feedback on a broad range of questions that examined
topics such as: challenges with eligibility and enrollment; ways we can
use data available to measure, monitor, and support improvement efforts
related to access to services; strategies we can implement to support
equitable and timely access to providers and services; and
opportunities to use existing and new access standards to help ensure
that Medicaid and CHIP payments are sufficient to enlist enough
providers.
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\11\ CMS Request for Information: Access to Coverage and Care in
Medicaid & CHIP. February 2022. For a full list of question from the
RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
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Some of the most common feedback we received through the RFI
related to ways that we can promote health equity through cultural
competency. Commenters shared the importance that cultural competency
plays in how beneficiaries access health care and in the quality of
health services received by beneficiaries. The RFI respondents shared
examples of actions that we could take, including collecting and
analyzing health outcomes data by sociodemographic categories;
establishing minimum standards for how States serve communities in ways
that address cultural competency and language preferences; and reducing
barriers to enrollment and retention for racial and ethnic minority
groups.
In addition to the topic of cultural competency, commenters also
commonly shared that they viewed reimbursement rates as a key driver of
provider participation in Medicaid and CHIP programs. Further,
commenters noted that aligning payment approaches and setting minimum
standards for payment regulations and compliance across Medicaid and
CHIP delivery systems, services, and benefits could help ensure that
beneficiaries' access to services is as similar as possible across
beneficiary groups, delivery systems, and programs.
As mentioned previously in this proposed rule, the first dimension
of access focuses on ensuring that eligible people are able to enroll
in the Medicaid program. Access to Medicaid enrollment requires that a
potential beneficiary know if they are or may be eligible for Medicaid,
be aware of Medicaid coverage options, and be able to easily apply for
and enroll in coverage. The second dimension of access in this
continuum relates to maintaining coverage once the beneficiary is
enrolled in the Medicaid program initially. Maintaining coverage
requires that eligible beneficiaries are able to stay enrolled in the
program without interruption, or that they know how to and can smoothly
transition to other health coverage, such as CHIP, Exchange coverage,
or Medicare, when they are no longer eligible for Medicaid coverage but
have become eligible for other health coverage programs. In September
2022, we published a proposed rule, Streamlining the Medicaid,
Children's Health Insurance Program, and Basic Health Program
Application, Eligibility, Determination, Enrollment, and Renewal
Processes (87 FR 54760; hereinafter the ``Streamlining Eligibility &
Enrollment proposed rule'') to simplify the processes for eligible
individuals to enroll and retain eligibility in Medicaid, CHIP, and the
Basic Health Program (BHP).
The third dimension, which is the focus of this proposed rule, is
access to services and supports. This rule is focused on addressing
additional critical elements of access: (1) potential access, which
refers to a beneficiary's access to providers and services, whether or
not the providers or services are used; (2) beneficiary utilization,
which refers to beneficiaries' actual use of the providers and services
available to them; and (3) beneficiaries' perceptions and experiences
with the care they did or were not able to receive. These terms and
definitions build upon previous efforts to examine how best to monitor
access.\12\
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\12\ Kenney, Genevieve M., Kathy Gifford, Jane Wishner, Vanessa
Forsberg, Amanda I. Napoles, and Danielle Pavliv. ``Proposed
Medicaid Access Measurement and Monitoring Plan.'' Washington, DC:
The Urban Institute. August 2016. Accessed at https://www.urban.org/sites/default/files/publication/88081/2001143-medicaid-access-measurement-and-monitoring-plan_0.pdf.
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We are engaging in an array of regulatory activities, including
three rulemakings that are currently underway (more specifically, the
Streamlining Eligibility & Enrollment proposed rule, a proposed rule,
entitled
[[Page 27962]]
Medicaid and Children's Health Insurance Program (CHIP) Managed Care
Access, Finance, and Quality, on managed care including matters of
access, and this proposed rule on access). Additionally, we are taking
non-regulatory activities to improve beneficiary access to care (for
example, best practices toolkits and technical assistance to States) to
improve access to health care services across Medicaid delivery
systems.
As noted earlier, we issued the Streamlining Eligibility &
Enrollment proposed rule to address the first two dimensions of access
to health care: (1) enrollment in coverage and (2) maintenance of
coverage. Through that proposed rule, we sought to streamline Medicaid,
CHIP and BHP eligibility and enrollment processes, reduce
administrative burden on States and applicants/enrollees toward a more
seamless eligibility and enrollment process, and increase the
enrollment and retention of eligible individuals.
The managed care proposed rule seeks to improve access to care and
quality outcomes for Medicaid and CHIP beneficiaries enrolled in
managed care by: creating standards for timely access to care and
States' monitoring and enforcement efforts; reducing burden for some
State directed payments and certain quality reporting requirements;
adding new standards that would apply when States use in lieu of
services and settings (ILOSs) to promote effective utilization, and
specifying the scope and nature of ILOS; specifying medical loss ratio
(MLR) requirements, and establishing a quality rating system for
Medicaid and CHIP managed care plans.
Through the managed care proposed rule and this proposed rule
(Ensuring Access to Medicaid Services), we propose additional
requirements to address the third dimension of the health care access
continuum: access to services. The proposed requirements outlined later
in this section focus on improving access to services in Medicaid by
utilizing tools such as FFS rate transparency, standardized reporting
for HCBS, and improving the process for interested parties, especially
Medicaid beneficiaries, to provide feedback to State Medicaid agencies
and for Medicaid agencies to respond to the feedback (also known as a
feedback loop).
Through a combination of these three proposed rules, we seek to
address a range of access-related challenges that impact how
beneficiaries are served by Medicaid across all of its delivery
systems. FFP would be available for expenditures that might be
necessary to implement the activities States would need to undertake to
comply with the provisions of the proposed rules, if finalized.
Finally, we also believe it is important to acknowledge the role of
health equity within this proposed rule. Medicaid plays a
disproportionately large role in covering health care for people of
color in this country.\13\ Consistent with E.O. 13985 on Advancing
Racial Equity and Support for Underserved Communities Through the
Federal Government (January 20, 2021),\14\ which calls for advancing
equity for underserved populations, we are working to ensure our
programs consistently provide high-quality care to all beneficiaries,
and thus advance health equity, consistent with the goals and
objectives we have outlined in the CMS Framework for Health Equity
2022-2032 \15\ and the HHS Equity Action Plan.\16\ That effort includes
increasing our understanding of the needs of those we serve to ensure
that all individuals have access to equitable care and coverage.
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\13\ Guth, M. and Artiga, S. Medicaid and Racial Health Equity
March 2022. Accessed at https://www.kff.org/medicaid/issue-brief/medicaid-and-racial-health-equity/.
\14\ Executive Order 13985: https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
\15\ CMS Framework for Health Equity 2022-2032: https://www.cms.gov/files/document/cms-framework-health-equity.pdf.
\16\ HHS Equity Action Plan. April 2022. Accessed at https://www.hhs.gov/sites/default/files/hhs-equity-action-plan.pdf.
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We recognize that each State faces a unique set of challenges
related to the resumption of its normal program acvitities after the
end of the COVID-19 public health emergency (PHE). More specifically,
the expiration of the continuous enrollment condition authorized by the
Families First Coronavirus Response Act (FFCRA) presents the single
largest health coverage transition event since the first open
enrollment period of the Affordable Care Act. As a condition of
receiving a temporary 6.2 percentage point Federal Medical Assistance
Percentage (FMAP) increase under the FFCRA, States have been required
to maintain enrollment of nearly all Medicaid enrollees. This
continuous enrollment condition expired on March 31, 2023, and States
now have 12 months to initiate and 14 months to complete renewals for
all individuals enrolled in Medicaid, CHIP and the Basic Health
Program. Additionally, many other temporary authorities adopted by
States during the COVID-19 PHE will expire at the end of the PHE, and
States will be returning to regular operations across their programs.
The resumption of normal Medicaid operations is generally referred to
as ``unwinding'' and the 12-month period for States to initiate all
outstanding eligibility actions that were delayed because of the FFCRA
continuous enrollment condition is called the ``unwinding period.'' CMS
considered States' unwinding responsibilities when proposing the
effective dates for the proposals in this rule, but, as noted below, we
seek State feedback on whether our proposals strike the correct
balance.
As we contemplate the timing of a final rule, we are considering
adopting an effective date of 60 days following publication of the
final rule and separate compliance dates for various provisions, which
we note where relevant in our discussion of specific proposals in this
proposed rule. We seek comment on whether an effective date of 60 days
following publication would be appropriate when combined with later
dates for compliance for some provisions. We also seek comment on the
timeframe that would be most achievable and appropriate for compliance
with each proposed provision and whether the compliance date should
vary by provision.
B. Medical Care Advisory Committees (MCAC)
We obtained feedback during various public engagement activities
conducted with States and other interested parties, which supports
research findings that the beneficiary perspective and lived Medicaid
experience \17\ should be considered when making policy decisions
related to Medicaid programs.18 19 A 2022 report from the
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HHS Assistant Secretary of Planning and Evaluation (ASPE) noted that
including people with lived experience in the policy-making process can
lead to a deeper understanding of the conditions affecting certain
populations, facilitate identification of possible solutions, and avoid
unintended consequences of potential policy or program changes that
could negatively impact the people the program aims to serve.\20\ We
have concluded that beneficiary perspectives need to be central to
operating a high-quality health coverage program that consistently
meets the needs of all its beneficiaries.
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\17\ Lived experience refers to ``representation and
understanding of an individual's human experiences, choices, and
options and how those factors influence one's perception of
knowledge'' based on one's own life. In this context, we refer to
people who have been enrolled in Medicaid currently or in the past.
Accessed at https://aspe.hhs.gov/lived-
experience#:~:text=In%20the%20context%20of%20ASPE%E2%80%99s%20researc
h%2C%20people%20with,programs%20that%20aim%20to%20address%20the%20iss
ue%20%28s%29.
\18\ Zhu JM, Rowland R, Gunn R, Gollust S, Grande DT. Engaging
Consumers in Medicaid Program Design: Strategies from the States.
Milbank Q. 2021 Mar;99(1):99-125. doi: 10.1111/1468-0009.12492. Epub
2020 Dec 15. PMID: 33320389; PMCID: PMC7984666. Accessed at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7984666/.
\19\ Key Findings from the Medicaid MCO Learning Hub Discussion
Group Series and Roundtable--Focus on Member Engagement and the
Consumer Voice. NORC at the University of Chicago. Jan 2021.
Accessed at https://www.norc.org/PDFs/Medicaid%20Managed%20Care%20Organization%20Learning%20Hub/MMCOLearningHub_MemberEngagement.pdf.
\20\ Syreeta Skelton-Wilson et al., ``Methods and Emerging
Strategies to Engage People with Lived Experience,'' Office of the
Assistant Secretary for Planning and Evaluation (ASPE), U.S.
Department of Health and Human Services, January 4, 2022, https://aspe.hhs.gov/reports/lived-experience-brief.
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However, effective community engagement is not as simple as
planning a meeting and requesting feedback. To create opportunities
that facilitate true engagement, it is important to understand and
honor strengths and assets that exist within communities; recognize and
solicit the inclusion of diverse voices; dedicate resources to ensuring
that engagement is done in culturally meaningful ways; ensure
timelines, planning processes, and resources that support equitable
participation; and follow up with communities to let them know how
their input was utilized. Ensuring optimal health outcomes for all
beneficiaries served by a program through the design, implementation,
and operationalization of policies and programs requires intentional
and continuous effort to engage people who have historically been
excluded from the process.
Section 1902(a)(4) of the Act is a longstanding statutory provision
that, as implemented in part in regulations currently codified at 42
CFR 431.12,\21\ requires States to have a Medical Care Advisory
Committee (MCAC) in place to advise the State Medicaid agency about
health and medical care services. Under section 1903(a)(7) of the Act,
expenditures made by the State agency to operate the MCAC are eligible
for Federal administrative match.
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\21\ The regulatory provision was originally established in 36
FR 3793 at 3870.
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The current MCAC regulations at Sec. 431.12 require States to
establish such a committee, and describe high-level requirements
related to the composition of the committee, the scope of topics to be
discussed, and the support the Committee can receive from the State in
its administration. Due to the lack of specificity in the current
regulations, these regulations have not been consistently implemented
across States. For example, there is no mention of how States should
approach meeting periodicity or meeting structure in ways that are
conducive to including a variety of Medicaid interested parties. There
is also no mention in the regulations about how States can build
accountability through transparency with their interested parties by
publicly sharing meeting dates, membership lists, and the outcomes of
these meetings. The regulations also limit the MCAC discussions to
topics about health and medical care services--which in turn limits the
benefits of using the MCAC as a vehicle that can provide States with
varied ideas, suggestions, and experiences on a range of issues
(medical and non-medical) related to the effective administration of
the Medicaid program.
As such, we have determined the requirements governing MCACs need
to be more robust to ensure all States are using these committees
optimally to realize a more effective and efficient Medicaid program
that is informed by the experiences of beneficiaries, their caretakers,
and other interested parties. The current regulations have been in
place without change for over 40 years.\22\ Over the last four decades,
we have learned that the current MCAC requirements are insufficient in
ensuring that the beneficiary perspective is meaningfully represented
on the MCAC. Recent research regarding soliciting input from
individuals with lived experience, including our recent discussions
with States about their MCAC, provide a unique opportunity to re-
examine the purpose of this committee and update the policies to
reflect four decades of program experience.
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\22\ 43 FR 45091 at 45189.
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In 2022, we gathered feedback from various public engagement
activities conducted with States, other interested parties, and
directly from a subset of State Medicaid agencies that described a wide
variation in how States are operating MCACs today. The feedback
suggested that some MCACs operate simply to meet the broad Federal
requirements. As discussed previously in this section, we have
discovered that our current regulations do not further the statutory
goal of meaningfully engaging Medicaid beneficiaries and other low-
income people in matters related to the operation of the Medicaid
program. Meaningful engagement can help develop relationships and
establish trust between the communities served and the Medicaid agency
to ensure States receive important information concerning how to best
provide health coverage to their beneficiary populations. The current
MCAC regulations establish the importance of broad feedback from
interested parties, but they lack the specificity that can ensure
States use MCACs in ways that facilitate that feedback.
The current regulation requires that MCACs must include Medicaid
beneficiaries as committee members. However, the regulations do not
mention or account for the reality that other interested parties can
stifle beneficiary contribution in a group setting. For example, when
there are a small number of beneficiary representatives in large
committees with providers, health plans, and professional advocates, it
can be uncomfortable and intimidating for beneficiaries to share their
perspective and experience. Based on these reasons, several States
already use beneficiary-only groups that feed into larger MCACs.
Improvements to the MCACs are critical to ensuring a robust and
accurate understanding of beneficiaries' challenges to health care
access. The current regulations value State Medicaid agencies having a
way to get feedback from interested parties on issues related to the
Medicaid program. However, the current regulations lack specificity
related to how MCACs can be used to benefit the Medicaid program more
expressly by more fully promoting the beneficiary voice. MCACs need to
provide a forum for beneficiaries and people with lived experience with
the Medicaid program to share their experiences and challenges with
accessing health care, and to assist States in understanding and better
addressing those challenges. These committees also represent unique
opportunities for States to include representation by members that
reflect the demographics of their Medicaid program to ensure that the
program is best serving the needs of all beneficiaries, but not all
States are utilizing that opportunity.
The proposed rule seeks to strike a balance that reflects how
States currently use advisory committees (such as MCACs or standalone
beneficiary groups). We know that some States approach these committees
as a way to meet a Federal requirement while other States are using
them in much more innovative ways. As a middle ground, the proposed
rule seeks to: (1) address the gaps in the current regulations
described previously in this section; and (2) establish requirements to
implement
[[Page 27964]]
more effective advisory committees. States would select members in a
way that reflects a wide range of Medicaid interested parties (covering
a diverse set of populations and interests relevant to the Medicaid
program), place a special emphasis on the inclusion of the beneficiary
perspective, and create a meeting environment where each voice is
empowered to participate equally.
The changes we propose in this rule are rooted in best practices
learned from experience and from current State examples of community
engagement that support getting the type of feedback and experiences
from beneficiaries, their caretakers, providers, and other interested
parties that can then be used to positively impact care delivered
through the Medicaid program.
Accordingly, the proposed rule includes changes that, if finalized,
would support the implementation of the principles of bi-directional
feedback, transparency, and accountability. We propose changes to the
features of the new committee that could most effectively ensure member
engagement, including the staff and logistical support that is required
for beneficiaries and individuals representing beneficiaries to
meaningfully participate in these committees. We also propose changes
to expand the scope of topics to be addressed by the committee, address
committee membership composition, prescribe the features of
administration of the committee, establish requirements of an annual
report, and underscore the importance of beneficiary engagement through
the addition of a related beneficiary-only group.
C. Home and Community-Based Services (HCBS)
While Medicaid programs are required to provide medically necessary
nursing facility services for most eligible individuals age 21 or
older, coverage for home and community-based services (HCBS) is a State
option.\23\ As a result of this ``institutional bias,'' Medicaid
reimbursement for LTSS was primarily spent on institutional care,
historically, with very little spending for HCBS.\24\ However, over the
past several decades, States have used several Medicaid
authorities,\25\ as well as CMS-funded grant programs,\26\ to develop a
broad range of HCBS to provide alternatives to institutionalization for
eligible Medicaid beneficiaries and to advance person-centered care.
Consistent with many beneficiaries' preferences for where they would
like to receive their care, HCBS have become a critical component of
the Medicaid program and are part of a larger framework of progress
toward community integration of older adults and people with
disabilities that spans efforts across the Federal government. In fact,
total Medicaid HCBS expenditures surpassed the long-standing benchmark
of 50 percent of LTSS expenditures in FY 2013 and has remained higher
than 50 percent since then, reaching 55.4 percent in FY 2017 and 58.6
percent in FY 2019.\27\ A total of 30 States spent at least 50 percent
of Medicaid LTSS expenditures on HCBS in FY 2019.
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\23\ Murray, Caitlin, Alena Tourtellotte, Debra Lipson, and
Andrea Wysocki. ``Medicaid Long Term Services and Supports Annual
Expenditures Report: Federal Fiscal Year 2019.''Chicago, IL:
Mathematica, December, 2021. Accessed at https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltssexpenditures2019.pdf.
\24\ Centers for Medicare and Medicaid Services. November 2020.
Long-Term Services and Supports Rebalancing Toolkit. Accessed at
https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-rebalancing-toolkit.pdf.
\25\ These authorities include Medicaid State plan personal care
services and Social Security Act (the Act) section 1915(c) waivers,
section 1915(i) State plan HCBS, section 1915(j) self-directed
personal assistant services, and section 1915(k) Community First
Choice. See https://www.medicaid.gov/medicaid/home-community-based-services/home-community-based-services-authorities/index.html for
more information on these authorities. Some States also use
demonstration authority under section 1115(a) of the Act to cover
and test home and community-based service strategies. See https://www.medicaid.gov/medicaid/section-1115-demonstrations/index.html for
more information.
\26\ Federally funded grant programs include the Money Follows
the Person (MFP) demonstration program, which was initially
authorized by the Deficit Reduction Act of 2005 (Pub. L. 109-171).
The MFP program was recently extended under the Consolidated
Appropriations Act, 2021 (Pub. L. 116-260), which allowed new States
to join the demonstration and made statutory changes affecting MFP
participant eligibility criteria, allowing grantees to provide
community transition services under MFP earlier in an eligible
individual's inpatient stay.
\27\ Murray, Caitlin, Alena Tourtellotte, Debra Lipson, and
Andrea Wysocki. ``Medicaid Long Term Services and Supports Annual
Expenditures Report: Federal Fiscal Year 2019.'' Chicago, IL:
Mathematica, December 9, 2021. Accessed at https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltssexpenditures2019.pdf.
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Furthermore, HCBS play an important role in States' efforts to
achieve compliance with the Americans with Disabilities Act (ADA) of
1990, section 504 of the Rehabilitation Act of 1973 (section 504),\28\
section 1557 of the Affordable Care Act, and the Supreme Court's
decision in Olmstead v. L.C.,\29\ in which the Court held that
unjustified segregation of persons with disabilities is a form of
unlawful discrimination under the ADA \30\ and States must ensure that
persons with disabilities are served in the most integrated setting
appropriate to their needs.\31\ Section 9817 of the American Rescue
Plan Act of 2021 (ARP) (Pub. L. 117-2) recently provided a historic
investment in Medicaid HCBS by providing qualifying States with a
temporary 10 percentage point increase to the FMAP for certain Medicaid
expenditures for HCBS that States must use to implement or supplement
the implementation of one or more activities to enhance, expand, or
strengthen HCBS under the Medicaid program.\32\
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\28\ HHS interprets section 504 and Title II of the ADA
similarly regarding the integration mandate and the Department of
Justice generally interprets the requirements under section 504
consistently with those under Title II of the ADA.
\29\ 527 U.S. 581 (1999).
\30\ Medicaid and the Olmstead Decision. Accessed at https://www.medicaid.gov/about-us/program-history/medicaid-50th-anniversary/entry/47688.
\31\ Medicaid and the Olmstead Decision. Accessed at https://www.medicaid.gov/about-us/program-history/medicaid-50th-anniversary/entry/47688.
\32\ Information on State activities to expand, enhance, or
strengthen HCBS under ARP section 9817 can be found on Medicaid.gov
at https://www.medicaid.gov/medicaid/home-community-based-services/guidance/strengthening-and-investing-home-and-community-based-services-for-medicaid-beneficiaries-american-rescue-plan-act-of-2021-section-9817/index.html.
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Medicaid coverage of HCBS varies by State and can include a
combination of medical and non-medical services, such as case
management, homemaker, personal care, adult day health, habilitation
(both day and residential), and respite care services. HCBS programs
serve a variety of targeted population groups, such as older adults,
and children and adults with intellectual or developmental
disabilities, physical disabilities, mental health/substance use
disorders, and complex medical needs. HCBS programs provide
opportunities for Medicaid beneficiaries to receive services in their
own homes and communities rather than in institutions.
CMS and States have worked for decades to support the increased
availability and provision of high-quality HCBS for Medicaid
beneficiaries. While there are quality and reporting requirements for
Medicaid HCBS, the requirements vary across authorities and are often
inadequate to provide the necessary information for ensuring that HCBS
are provided in a high-quality manner that best protects the health and
welfare of beneficiaries. Consequently, quality measurement and
reporting expectations are not consistent across and within services,
but instead vary depending on the authorities under which States are
delivering services. Additionally, States have flexibility to determine
the quality measures they use in their HCBS programs. While we support
State flexibility, a lack of
[[Page 27965]]
standardization has resulted in thousands of metrics and measures
currently in use across States, with different metrics and measures
often used for different HCBS programs within the same State. As a
result, CMS and States are limited in the ability to compare HCBS
quality and outcomes within and across States or to compare the
performance of HCBS programs for different populations.
In addition, although there are differences in rates of disability
among demographic groups, there are very limited data currently
available to assess disparities in HCBS access, utilization, quality,
and outcomes. Few States have the data infrastructure to systematically
or routinely report data that could be used to assess whether
disparities exist in HCBS programs. This lack of available data also
prevents CMS and States from implementing interventions to make
improvements in HCBS programs designed to consistently meet the needs
of all beneficiaries.
Compounding these concerns have been notable and high-profile
instances of abuse and neglect in recent years, which have been shown
to result from poor quality care and inadequate oversight of HCBS in
Medicaid. For example, a 2018 report, ``Ensuring Beneficiary Health and
Safety in Group Homes Through State Implementation of Comprehensive
Compliance Oversight,'' \33\ (``Joint Report''), which was jointly
developed by the US Department of Health and Human Services'
Administration for Community Living (ACL), Office for Civil Rights
(OCR), and the Office of Inspector General (OIG), found systemic
problems with health and safety policies and procedures being followed
in group homes and that failure to comply with these policies and
procedures left beneficiaries in group homes at risk of serious harm.
In addition, while existing regulations provide safeguards for all
Medicaid beneficiaries in the event of a denial of Medicaid eligibility
or an adverse benefit determination by the State Medicaid agency and,
where applicable, by the beneficiary's managed care plan, there are no
safeguards related to other issues that HCBS beneficiaries may
experience, such as the failure of a provider to comply with the HCBS
settings requirements or difficulty accessing the services in the
person-centered service plan unless the individual is receiving those
services through a Medicaid managed care arrangement.
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\33\ Ensuring Beneficiary Health and Safety in Group Homes
Through State Implementation of Comprehensive Compliance Oversight.
US Department of Human Services, Office of the Inspector General,
Administration for Community Living, and Office for Civil Rights.
January 2018. Accessed at https://oig.hhs.gov/reports-and-publications/featured-topics/group-homes/group-homes-joint-report.pdf.
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Finally, through our regular interactions with State Medicaid
agencies, provider groups, and beneficiary advocates, we observed that
all these interested parties routinely cite a shortage of direct care
workers and high rates of turnover in direct care workers among the
greatest challenges in ensuring access to high-quality, cost-effective
HCBS for people with disabilities and older adults. Some States have
also indicated that a lack of direct care workers is preventing them
from transitioning individuals from institutions to home and community-
based settings. While workforce shortages have existed for years, they
have been exacerbated by the COVID-19 pandemic, which has resulted in
higher rates of direct care worker turnover (for instance, due to
higher rates of worker-reported stress), an inability of some direct
care workers to return to their positions prior to the pandemic (for
instance, due to difficulty accessing child care or concerns about
contracting COVID-19 for people with higher risk of severe illness),
workforce shortages across the health care sector, and wage increases
in types of retail and other jobs that tend to draw from the same pool
of workers.34 35 36
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\34\ MACPAC Issue Brief. State Efforts to Address Medicaid Home-
and Community-Based Services Workforce Shortages. March 2022.
Accessed at https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
\35\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\36\ American Network of Community Options and Resources
(ANCOR). 2021. The state of America's direct support workforce 2021.
Alexandria, VA: ANCOR. Accessed at https://www.ancor.org/sites/default/files/the_state_of_americas_direct_support_workforce_crisis_2021.pdf.
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To address the list of challenges outlined in this section, we are
proposing new Federal requirements in this proposed rule to improve
access to care, quality of care, and health and quality of life
outcomes; promote health equity for people receiving Medicaid-covered
HCBS; and ensure that there are safeguards in place for beneficiaries
who receive HCBS through FFS delivery systems. We seek comment on other
areas for rulemaking consideration. The proposed requirements are also
intended to promote public transparency related to the administration
of Medicaid HCBS programs.
D. Fee-for-Service (FFS) Payment
Section 1902(a)(30)(A) of the Act requires States 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.'' Regulations at Sec. 447.203 require States to develop and
submit to CMS an access monitoring review plan (AMRP) for a core set of
services. Currently, the regulations rely on available State data to
support a determination that the State's payment rates are sufficient
to ensure access to care in Medicaid FFS that is at least as great for
beneficiaries as is generally available to the general population in
the geographic area, as required under section 1902(a)(30)(A) of the
Act.
In the May 6, 2011, Federal Register, we published the ``Medicaid
Program; Methods for Assuring Access to Covered Medicaid Services''
proposed rule (76 FR 26341; hereinafter ``2011 proposed rule''), which
outlined a data-driven process for States with Medicaid services paid
through a State plan under FFS to follow in order to document their
compliance with section 1902(a)(30)(A) of the Act. We finalized the
2011 proposed rule in the November 2, 2015, Federal Register when we
published the ``Medicaid Program; Methods for Assuring Access to
Covered Medicaid Services'' final rule with comment period (80 FR
67576; hereinafter ``2015 final rule with comment period''). Among
other requirements, the 2015 final rule with comment period required
States to develop and submit to CMS an AMRP for certain Medicaid
services that is updated at least every 3 years. Additionally, the rule
required that when States submit a SPA to reduce or restructure
provider payment rates, they must consider the data collected through
the AMRP and undertake a public process that solicits input on the
potential impact of the proposed reduction or restructuring of Medicaid
FFS payment rates on beneficiary access to care. We published the
``Medicaid Program; Deadline for Access Monitoring Review Plan
Submissions'' final rule in the April 12, 2016 Federal Register (81 FR
21479; hereinafter ``2016 final rule'') with a revised deadline for
States' AMRPs to be submitted to us.
Following enactment, numerous States have expressed concern
regarding the administrative burden associated with the 2015 final rule
with comment period requirements, especially those
[[Page 27966]]
States with high rates of beneficiary enrollment in managed care. In an
attempt to address some of the States' concerns regarding unnecessary
administrative burden, we issued a State Medicaid Director letter
(SMDL) on November 16, 2017 (SMDL #17-004), which clarified the
circumstances in which provider payment reductions or restructurings
would likely not result in diminished access to care, and therefore,
would not require additional analysis and monitoring procedures
described in the 2015 final rule with comment period.\37\ Subsequently,
in the March 23, 2018 Federal Register, we published the ``Medicaid
Program; Methods for Assuring Access to Covered Medicaid Services-
Exemptions for States With High Managed Care Penetration Rates and Rate
Reduction Threshold'' proposed rule (83 FR 12696; hereinafter ``2018
proposed rule''), which would have exempted States from requirements to
analyze certain data or monitor access when the vast majority of their
covered beneficiaries receive services through managed care plans. That
proposed rule, if it had been finalized, would have provided similar
flexibility to all States when they make nominal rate reductions or
restructurings to FFS payment rates. Based on the responses received
during the public comment period, we decided not to finalize the
proposed exemptions.
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\37\ State Medicaid Director Letter #17-0004 Re: Medicaid Access
to Care Implementation Guidance. Accessed at https://www.medicaid.gov/federal-policy-guidance/downloads/smd17004.pdf
(November 2017).
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In the July 15, 2019 Federal Register, we published the ``Medicaid
Program; Methods for Assuring Access to Covered Medicaid Services-
Rescission'' proposed rule (84 FR 33722; hereinafter ``2019 proposed
rule'') to rescind the regulatory access requirements at Sec. Sec.
447.203(b) and 447.204, and concurrently issued a CMCS Informational
Bulletin \38\ stating the agency's intention to establish a new access
strategy. Based on the responses we received during the public comment
period, we decided not to finalize the 2019 proposed rule, and instead
continue our efforts and commitment to develop a data-driven strategy
to understand access to care in the Medicaid program.
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\38\ CMCS Informational Bulletin: Comprehensive Strategy for
Monitoring Access in Medicaid, Accessed at https://www.medicaid.gov/federal-policy-guidance/downloads/CIB071119.pdf (July 2019).
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States have continued to question whether the AMRP process is the
most effective or accurate reflection of access to care in a State's
Medicaid program, and requested we provide additional clarity on the
data necessary to support compliance with section 1902(a)(30)(A) of the
Act. In reviewing the information that States presented through the
AMRPs, we also have questioned whether the data and analysis
consistently address the primary access-related question posed by
section 1902(a)(30)(A) of the Act--namely, whether rates are sufficient
to ensure access to care at least as great as that enjoyed by the
general population in geographic areas. The unstandardized nature of
the AMRPs, which largely defer to States to determine appropriate data
measures to review and monitor when documenting access to care, have
made it difficult to assess whether any single State's analysis
demonstrates compliance with section 1902(a)(30)(A) of the Act.
While the AMRPs were intended to be a useful guide to States in the
overall process to monitor beneficiary access, they are generally
limited to access in FFS delivery systems and focus on targeted payment
rate changes rather than the availability of care more generally or
population health outcomes (which may be indicative of the population's
ability to access care). Moreover, the AMRP processes are largely
procedural in nature and not targeted to specific services for which
access may be of particular concern, requiring States to engage in
triennial reviews of access to care for certain broad categories of
Medicaid services--primary care services, physician specialist
services, behavioral health services, pre and post-natal obstetric
services, and home health services. Although the 2016 final rule
reasonably discussed that the selected service categories intended to
be indicators for available access in the overall Medicaid FFS system,
the categories do not easily translate to the services authorized under
section 1905(a) of the Act, granting States deference as to how broadly
or narrowly to apply the AMRP analysis to services within their
programs. For example, the category ``primary care services'' could
encompass several of the Medicaid service categories described within
section 1905(a) of the Act and, without clear guidance on which section
1905(a) services categories, qualified providers, or procedures we
intended States to include within the AMRP analyses. States were left
to make their own interpretations in analyzing access to care under the
2016 final rule.
Similarly, a number of the AMRP data elements, both required and
suggested within the 2016 final rule, may be overly broad, subject to
interpretation, or difficult to obtain. Specifically, under the 2016
final rule provisions, States are required to review: the extent to
which beneficiary needs are fully met; the availability of care through
enrolled providers to beneficiaries in each geographic area, by
provider type and site of service; changes in beneficiary utilization
of covered services in each geographic area; the characteristics of the
beneficiary population (including considerations for care, service and
payment variations for pediatric and adult populations and for
individuals with disabilities); and actual or estimated levels of
provider payment available from other payers, including other public
and private payers, by provider type and site of service. Though
service utilization and provider participation are relatively easy
measures to source and track using existing Medicaid program data, an
analysis of whether beneficiary needs are fully met is at least
somewhat subjective and could require States to engage in a survey
process to complete. Additionally, while most Medicaid services have
some level of equivalent payment data that can be compared to other
available public payer data, such as Medicare, private pay information
may be proprietary and difficult to obtain. Therefore, many States
struggled to meet the regulatory requirement comparing Medicaid program
rates to private payer rates because of their inability to obtain
private payer data.
Due to these issues, States produced varied AMRPs through the
triennial process that were, as a whole, difficult to interpret or to
use in assessing compliance with section 1902(a)(30)(A) of the Act. In
isolation, a State's specific AMRP most often presented data that could
be meaningful as a benchmark against changes within a State's Medicaid
program, but did not present a case for Medicaid access consistent with
the general population in geographic areas. Frequently, the data and
information within the AMRPs were presented without a formal
determination or attestation from the State that the information
presented established compliance with section 1902(a)(30)(A) of the
Act. Because the States' AMRPs generally varied to such a great degree,
there was also little to glean in making State-to-State comparisons of
performance on access measures, even for States with geographic and
demographic similarities.
Based on results of the triennial AMRPs, we were uncertain of how
to make use of the information presented within them other than to make
them publicly available. We published the
[[Page 27967]]
AMRPs on Medicaid.gov but had little engagement with States on the
content or results of the AMRPs since much of the information within
the plans could not meaningfully answer whether access in Medicaid
programs satisfied the requirements of section 1902(a)(30)(A) of the
Act. Additionally, we received little feedback from providers,
beneficiaries, or advocates on whether or how interested parties made
use of the triennial AMRPs. However, portions of the 2016 final rule
related to public awareness and feedback on changes to Medicaid payment
rates and the analysis that we received from individual States
proposing to make rate changes was of great benefit in determining
approvals of State payment change proposals. Specifically, the portion
of the AMRP process where States update their plans to describe data
and measures to serve as a baseline against which they monitor after
reducing or restructuring Medicaid payments allows States to document
consistency with section 1902(a)(30)(A) of the Act at the time of SPA
submission, usually as an assessment of how closely rates align with
Medicare rates, and to understand the impact of reductions through data
monitoring after SPA approval.
Under this proposed rule, we are proposing to balance elimination
of unnecessary Federal and State administrative burden with robust
implementation of the Federal and State shared obligation to ensure
that Medicaid payment rates are set at levels sufficient to ensure
access to care for beneficiaries consistent with section 1902(a)(30)(A)
of the Act. The provisions of this proposed rule, as discussed in more
detail later, would better achieve this balance through improved
transparency of Medicaid FFS payment rates, through publication of a
comparative payment rate analysis to Medicare and payment rate
disclosures, and through a more targeted and defined approach to
evaluating data and information when States propose to reduce or
restructure their Medicaid payment rates. Payment rate transparency is
a critical component of assessing compliance with section
1902(a)(30)(A) of the Act. In addition, payment rate transparency helps
to ensure that interested parties have basic information available to
them to understand Medicaid payment levels and the associated effects
of payment rates on access to care so that they may raise concerns to
State Medicaid agencies via the various forms of public processes
discussed within this proposed rule. Along with improved payment rate
transparency and disclosures as well as comparative payment rate
analyses, we are proposing a more efficient process for States to
undertake when submitting rate reduction or restructuring SPAs to CMS
for review. As we move toward aligning our Medicaid access to care
strategy across FFS and managed care delivery systems, we will consider
additional rulemaking to help ensure that Medicaid payment rate
information is appropriately transparent and rates are fully consistent
with broad access to care across delivery systems, so that interested
parties have a more complete understanding of Medicaid payment rate
levels and resulting access to care for beneficiaries.
II. Provisions of the Proposed Regulations
A. Medicaid Advisory Committee and Beneficiary Advisory Group (Sec.
431.12)
Current Sec. 431.12 requires States to have a MCAC to advise the
State Medicaid agency about health and medical care services. The
current regulations are intended to ensure that State Medicaid agencies
have a way to receive feedback from interested parties on issues
related to the Medicaid program. However, the current regulations lack
specificity related to how these committees can be used to ensure the
proper and efficient administration of the Medicaid program more
expressly by more fully promoting beneficiary perspectives.
Under the authority of section 1902(a)(4) of the Act, section
1902(a)(19) of the Act, and our general rulemaking authority in section
1102 of the Act, we propose to update Sec. 431.12 to replace the
current MCAC requirements with a committee framework designed to ensure
the proper and efficient administration of the Medicaid program and to
better ensure that care and services under the Medicaid program will be
provided in a manner consistent with the best interests of the
beneficiaries. If finalized, States would be required to establish and
operate the newly named Medicaid Advisory Committee (MAC) and a
Beneficiary Advisory Group (BAG). The MAC and its corresponding BAG
would serve as vehicles for bi-directional feedback between interested
parties and the State on matters related to the effective
administration of the Medicaid program. With this proposal, FFP, or
Federal match, for Medicaid administrative activities would remain
available to States for expenditures related to MAC and BAG activities
in the same manner as the former MCAC.
We propose to amend the title and paragraph (a) of Sec. 431.12 to
update the name of the existing MCAC to the MAC, and to add the
requirement for States to establish and operate a dedicated advisory
group comprised of Medicaid beneficiaries, the BAG. Our goal is that
the committee and its corresponding advisory group would advise the
State not only on issues related to health and medical services, as the
MCAC did, but also on matters related to policy development and to the
effective administration of the Medicaid program consistent with the
language of section1902(a)(4)(B) of the Act, which requires a State
plan to meaningfully engage Medicaid beneficiaries and other low-income
people in the administration of the plan. While the Medicaid program
covers medical services, the program is increasingly also covering
services designed to address beneficiaries' social determinants of
health and their health-related social needs more generally. Therefore,
having a discussion with the MAC about topics that are not directly
related to covered services may be necessary to ensure that
beneficiaries are able to meaningfully access these services. Expanding
the scope of the current committee is necessary to align the actions of
the committee with the expanding scope of the Medicaid program,
consistent with section 1902(a)(4)(B) of the Act, because the MAC
creates a formalized way for interested parties and beneficiary
representatives to provide feedback to the State about issues related
to the Medicaid program and the services it covers and to help ensure
that the program operates efficiently and as it was designed to
operate.
Every State will vary in the types of topics that would benefit
from the interested parties' feedback, so discretion on which topics
will be discussed with the MAC will be left to the State. Depending on
the priorities of the State in a given year, States may find it helpful
to bring to the MAC issues related to, for example, grievances,
consumer experience survey ratings, design of a new program, or other
like topics. Proposed mandates for these entities are described later
in this section under proposed paragraph (g). We further propose
conforming updates to paragraph (b) regarding the State plan
requirements, to reflect the proposed MAC and BAG and the expanded
mandate proposed in this proposed rule. The interested parties advisory
group, proposed and described in the FFS sections of this proposed
rule, to advise States on rate setting for certain HCBS
[[Page 27968]]
is not related to the MAC or BAG outlined here. We note in that section
that a State would be able utilize its MAC and BAG to provide
recommendations for payment rates, thereby satisfying the requirements
of that proposal. However, the MAC and BAG requirements proposed here,
if finalized, are wholly separate from the interested parties advisory
group, regardless of whether that proposal is finalized as well.
We propose to update paragraph (c) of Sec. 431.12 regarding
appointment of committee members to specify that the members of the MAC
and BAG must be appointed by the agency director or higher State
authority on a rotating, continuous basis. Under our proposals,
committee and advisory group members would serve a specific amount of
time, the length of which will be determined by each State and noted in
its bylaws. After a committee or advisory group member term has been
completed, the State will appoint a new member, thus ensuring that MAC
and BAG memberships rotate continuously. We propose the State be
required to make public its process and bylaws for recruitment and
appointment of members of the MAC and BAG and post the list of both
sets of members on the State's website. Under our proposal, the website
page where this information is located must be easily accessible by the
public. These updates align with how advisory committees similar to the
MAC and BAG are run, and the changes are designed to provide additional
details to support States' operation of the MAC and BAG. Further, these
updates facilitate transparency, improving the current regulations,
which do not mention nor promote transparency of information related
the MCAC with the public. We believe that transparency of information
can lead to enhanced accountability on the part of the State to making
its MAC and BAG as effective as possible.
Advisory committees and groups can be most effective when they
represent a wide range of perspectives and experiences. The current MAC
regulations only provide high level descriptions of types of members
that should be selected. Since we know that each State environment is
different, in the proposed rule, we continue to provide the State with
discretion on how large the MAC and BAG should be, but we outline in
more detail the types of categories of members that can best reflect
the needs of a Medicaid program. We believe that diversely populated
MACs and BAGs can provide States with access to a broad range of
perspectives, and importantly, beneficiaries' perspective, which can
positively impact the administration of the Medicaid program.
We encourage States to take into consideration, as part of their
member selection process, the demographics of the Medicaid population
in their State. Keeping diverse representation in mind as a goal for
the MAC membership can be a way for States to acknowledge that specific
populations and those receiving critically important services be
appropriately represented on the MAC. For example, in making the MAC
appointments, the State may want to balance the representation of the
MAC according to geographic areas of the State and the demographics of
the Medicaid program of the State. The State may want to consider
geographical diversity (for example, urban, rural, tribal) when making
its membership selections. The State could also consider demographic
representation of its membership by including members representing or
serving Medicaid beneficiaries the following categories: (1) children's
health care; (2) behavioral health services; (3) preventive care and
reproductive health services; (4) health or service issues pertaining
specifically to people over age 65; and (5) health or service issues
pertaining specifically to people with disabilities. By offering these
considerations, we seek to support States in their efforts to eliminate
differences in health care access and outcomes experienced by diverse
populations enrolled in Medicaid. Our aim is to support several of the
priorities for operationalizing health equity across CMS programs as
outlined in the CMS Framework for Health Equity (2022-2032) and the HHS
Equity Action Plan which is consistent with E.O. 13985 which calls for
advancing equity for underserved populations.
As we considered effective ways to better integrate the beneficiary
perspective into decisions related the Medicaid program, we also
recognized that a diverse and representative set of interested parties
should be reflected in the composition of each State's MAC. We propose
to amend paragraph (d) of Sec. 431.12 regarding committee membership
to account for both membership and composition, and to require the MAC
membership include members from the BAG, described later in this
section, who are currently or have been Medicaid beneficiaries, and
individuals with direct experience supporting Medicaid beneficiaries
(for example, family members or caregivers \39\ of those enrolled in
Medicaid); as well as advocacy groups; providers or administrators of
Medicaid services; representatives of managed care plans or State
health plan associations representing such managed care plans; and
representatives from other State agencies that serve Medicaid
beneficiaries. This proposal is consistent with the language of section
1902(a)(4)(B) of the Act, which requires a State plan to meaningfully
engage Medicaid beneficiaries and other low-income people in the
administration of the plan. The change we propose would support States
to set up MACs that align with section 1902(a)(4)(B) of the Act since
they would now have to select the membership composition to reflect the
community members who represent the interests of Medicaid
beneficiaries. The State also benefits from having a way to hear how
the Medicaid program can be responsive to its beneficiaries' and the
Medicaid community's needs.
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\39\ Caregivers can be paid or unpaid.
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Specifically, in paragraph (d)(1) of Sec. 431.12, we propose that
at least 25 percent of the MAC must be individuals with lived Medicaid
beneficiary experience from the BAG. This means that the BAG would be
comprised of people who: (1) are currently or have been Medicaid
beneficiaries and (2) individuals with direct experience supporting
Medicaid beneficiaries (family members or caregivers of those enrolled
in Medicaid). We selected 25 percent as a threshold to reflect the
importance of including the beneficiary perspective in the
administration of the Medicaid program and to ensure that the
beneficiary perspective has equitable representation in the feedback
provided by the MAC. We did not select a higher percentage because we
acknowledge that States will benefit from a MAC that includes
representation from a diverse set of interested parties who work in
areas related to Medicaid but are not beneficiaries, their family
members or their caregivers. We seek comment on the 25 percent
requirement.
As noted earlier, representation from the remaining committee
members would be left to the States' discretion. Rather than
prescribing specific percentages for each category, we only propose to
require representation from each category as part of the MAC. The
specific percentage of each of category (other than the BAG members)
relative to the whole committee can be determined by each State. This
approach would provide States with flexibility to determine how to best
represent the unique landscape of each State's Medicaid program. We
seek comment on what should be the minimum percentage requirement that
MAC members be current/past Medicaid
[[Page 27969]]
beneficiaries or individuals with direct experience supporting Medicaid
beneficiaries (such as family members or caregivers of those enrolled
in Medicaid).
States need to know how to deliver care to its beneficiaries. In
addition to hearing directly from beneficiaries, the State can gain
insights into how to effectively administer its program, from other
groups of the Medicaid community. Categorically, we propose in
paragraph (d)(2) that the rest of the MAC must include representation
from each category: (1) members of State or local consumer advocacy
groups or other community-based organizations that represent the
interests of, or provide direct service, to Medicaid beneficiaries; (2)
clinical providers or administrators who are familiar with the health
and social needs of Medicaid beneficiaries and with the resources
available and required for their care; (3) representatives from
participating Medicaid managed care plans or the State health plan
association representing such plans, as applicable; and (4)
representatives from other State agencies serving Medicaid
beneficiaries, as ex-officio members.
States are determining which types of providers to include under
the clinical providers or administrators category, we recommend they
consider a wide range of providers or administrators that are
experienced with the Medicaid program including, but not limited to:
(1) primary care providers (internal or family medicine physicians or
nurse practitioners or physician assistants that practice primary
care); (2) behavioral health providers (that is, mental health and
substance use disorder providers); (3) reproductive health service
providers, including maternal health providers; (4) pediatric
providers; (5) dental and oral health providers; (6) community health,
rural health clinic or Federally Qualified Health Center (FQHC)
administrators; (7) individuals providing long-term care services and
supports; and (8) direct care workers \40\ who can be individuals with
direct experience supporting Medicaid beneficiaries (such as family
members or caregivers). Direct care workers also include community
health workers who assist Medicaid beneficiaries in navigating access
to needed services and care managers, care coordinators, or service
coordinators who assist Medicaid beneficiaries with complex care needs.
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\40\ CMS defines direct care workers as: a registered nurse,
licensed practical nurse, nurse practitioner, or clinical nurse
specialist who provides nursing services to Medicaid-eligible
individuals receiving home and community-based services; (2) A
licensed or certified nursing assistant who provides such services
under the supervision of a registered nurse, licensed practical
nurse, nurse practitioner, or clinical nurse specialist; (3) A
direct support professional; (4) A personal care attendant; (5) A
home health aide; or (6) Other individuals who are paid to provide
services to address activities of daily living or instrumental
activities of daily living, behavioral supports, employment
supports, or other services to promote community integration
directly to Medicaid-eligible individuals receiving home and
community-based services.
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We have also identified health plans as an important contributor to
the MAC, but we acknowledge that not all States that have managed care
delivery systems. We know many Medicaid health plans administer similar
committees and thus allow for States to tailor health plan
representation based on its managed care market. For example, States
can fulfil this category with only one or with multiple plans operating
in the State. In addition, we also give States the flexibility to meet
the health plan representation requirements with either participating
Medicaid managed care plans or the State health plan association
representing such plans, as applicable.
The proposed language in paragraph (d)(2)(D) broadens the type of
representatives from other State agencies that are required to be on
the committee from the similar MCAC requirement. The current MCAC
regulation requires membership by ``the director of the public welfare
department or the public health department, whichever does not head the
Medicaid agency.'' By expanding the definition of external agency
representation to be broader than the welfare or public health
department, we would give States more flexibility in representing the
Medicaid program's interests based on States' unique circumstances and
organizational structure. States can work with sister State agencies to
determine who should participate in the MAC (for example, foster care
agency, mental health agency, department of public health). We also
propose that these representatives be part of the committee as ex-
officio members, not as full members of the MAC. While we believe it
will be essential to have these State-interested parties present for
program coordination and information-sharing, we believe the formal
representation of the MAC should be comprised of beneficiaries,
advocates, community organizations, and providers that serve Medicaid
beneficiaries.
We propose to replace paragraph (e) of Sec. 431.12; in paragraph
(e) to require that States create a BAG, a dedicated beneficiary
advisory group that will meet separately from the MAC. Currently, the
requirements governing MCACs require the presence of beneficiaries in
committee membership but do little to ensure their contributions are
considered or their voices heard. For example, current paragraph (e)
describes committee participation and requires the committee
``[further] the participation of beneficiary members in the agency
program.'' This requirement provides little guidance toward this goal
and creates an environment where a beneficiary may not feel comfortable
participating despite the opportunity being afforded in its technical
sense. We believe adding the creation of the BAG will result in
providing the State with increased access to the beneficiary
perspective. This proposal directly addresses and provides the
mechanism (the BAG) through which States can meet the language of
section 1902(a)(4)(B) of the Act, which requires a State plan to
meaningfully engage Medicaid beneficiaries and other low-income people
in the administration of the plan.
As such, the creation of a separate beneficiary-only advisory group
aligns with what we learned from multiple interviews with State
Medicaid agencies and other Medicaid interested parties (for example,
Medicaid researchers, former Medicaid officials) conducted over the
course of 2022 on the effective operation of the existing MCACs.
Interested parties described the importance of having a comfortable,
supportive, and trusting environment that facilitates beneficiaries'
ability to speak freely on matters most important to them. It is
equally important that the BAG have a subset of its members that also
sit on the State's MAC to ensure that the beneficiary perspective and
experience are heard directly. We noted earlier that some States may
already have highly effective BAG-type groups operating as part of
their Medicaid program. These groups may represent specific
constituencies such as children with complex medical needs or older
adults or may be participants in a specific waiver. In these instances,
States may utilize these groups to satisfy the proposed requirements of
this rule, provided the BAG-type group membership includes the MAC
members described in paragraph (d)(1). Those States must appoint
members from the BAG-type group to serve on the MAC to facilitate this
crossover.
Specifically, at paragraph (e)(1), we propose that the MAC members
described in proposed paragraph (d)(1) must also be members of the BAG.
This proposed requirement would facilitate the bi-directional
communication essential to effective beneficiary
[[Page 27970]]
engagement and allow for meaningful representation of diverse voices
across the MAC and BAG. In paragraph (e)(2), we propose that the BAG
meetings occur in advance of each MAC meeting to ensure BAG member
preparation for each MAC discussion. BAG meetings would also be subject
to requirements we propose in paragraph (f)(5), described later in this
section, that the BAG meetings must occur virtually, in-person, or
through a hybrid option to maximize member attendance. We plan to
expound on best practices for engaging beneficiary participation in
committees like the MAC in future guidance.
We propose at subsection (f) an administrative framework for the
MAC and BAG to ensure transparency and a meaningful feedback loop to
the public and among the members of the committee and group. Interested
parties' feedback and recent reports 41 42 published on
meaningful beneficiary engagement illuminate the need for more
transparent and standardized processes across States to drive
participation from key interested parties and to facilitate the
opportunity for participation from a diverse set of members and the
community. Further, we believe that in order for the State to comply
with the language of section 1902(a)(4)(B) of the Act, which requires a
State plan to meaningfully engage Medicaid beneficiaries and other low-
income people in the administration of the plan, it needs to be
responsive to the needs of its beneficiaries. To be responsive to the
needs of its beneficiaries, the State needs to be able to gather
feedback from a variety of people that touch the Medicaid program, and
the MAC and BAG will serve as the vehicle through which States can
obtain this feedback.
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\41\ Resources for Integrated Care and Community Catalyst,
``Listening to the Voices of Dually Eligible Beneficiaries:
Successful Member Advisory Councils'', 2019. Retrieved from https://www.resourcesforintegratedcare.com/listening_to_voices_of_dually_eligible_beneficiaries/.
\42\ Centers for Medicare & Medicaid Services.(n.d.). Person &
Family Engagement Strategy: Sharing with Our Partners. Retrieved
from: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-
Assessment-Instruments/QualityInitiativesGenInfo/Downloads/Person-
and-Family-Engagement-Strategic-Plan-12-12-
16.pdf#:~:text=person%E2%80%99s%20priorities%2C%20goals%2C%20needs%20
and%20values.%E2%80%9D%20Using%20these,to%20guide%20all%20clinical%20
decisions%20and%20drives%20genuine.
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Specifically, in paragraph (f)(1), we propose to require State
agencies to develop and post publicly on their website bylaws for
governance of the MAC and BAG, current lists of MAC and BAG
memberships, and past meeting minutes for both the committee and group.
In paragraph (f)(2), we propose to require State agencies to develop
and post publicly a process for MAC and BAG member recruitment and
appointment, and for selection of MAC and BAG leadership. In paragraph
(f)(3), we propose to require State agencies to develop, publicly post,
and implement a regular meeting schedule for the MAC and BAG. The
requirement specifies the MAC and BAG must each meet at least once per
quarter and hold off-cycle meetings as needed. In paragraph (f)(4), we
propose that, at least two MAC meetings per year must be opened to the
public. For the MAC meetings that are open to the public, the meeting
agenda must include a dedicated time for public comment to be heard by
the MAC. Further, the State must also adequately notify the public of
the date, location, and time of these type (public) of MAC meetings at
least 30 calendar days in advance. None of the BAG meetings are not
required to be open to the public, unless the State's BAG members
decide otherwise. The same requirements would apply to States whose BAG
meetings were determined, by its membership, to be open to the public.
We seek comment on this approach.
In paragraph (f)(5), we propose to require that States offer in-
person and virtual attendance options to maximize member participation
at MAC and BAG meetings. We acknowledge that interested parties may
face a range of technological and internet accessibility limitations,
and that at a minimum, States will need to provide a telephone dial-in
option for MAC and BAG meetings. While we understand that in-person
interaction can sometimes assist in building trusted relationships, we
also recognize that accommodations for members and the public to
participate virtually is important, particularly since the beginning of
the COVID-19 pandemic. We invite comment on ways to best strike this
balance. We address technical and logistical challenges in paragraph
(f)(5) and address effective communication and language access and
meeting accessibility in subsequent paragraphs.
With respect to in-person meetings, we propose in paragraph (f)(6)
to require that States ensure meeting times and locations for MAC and
BAG meetings are selected to maximize participant attendance, which may
vary by meeting. For example, States may determine, by consulting with
its MAC and BAG members that holding meetings in various locations
throughout the State may result in better attendance. In addition, they
may ask the committee and group members about which times and weekdays
may be more favorable than others and hold meetings at those times
accordingly. States must also use the publicly posted meeting minutes,
which lists attendance by members, as a way to gauge which meeting
times and locations garner maximum participate attendance. Finally, in
paragraph (f)(7), we propose to require State agencies to facilitate
participation of beneficiaries by ensuring that meetings are accessible
to people with disabilities, that reasonable modifications are provided
when necessary to ensure access and enable meaningful participation,
that communication with individuals with disabilities is as effective
as with others, that reasonable steps are taken to provide meaningful
access to individuals with Limited English Proficiency, and that
meetings comply with the requirements at Sec. 435.905(b) and
applicable regulations implementing the ADA, section 504 of the
Rehabilitation Act, and section 1557 of the Affordable Care Act at 28
CFR part 35 and 45 CFR parts 84 and 92.
We propose to revise paragraph (g) to detail an expansion of the
topics on which the MAC and BAG should provide feedback to the Medicaid
agency from the prior MCAC requirements. In researching other States'
MACs, we know that some already use the MACs to get feedback from
interested parties, including beneficiaries, on a variety of topics
relating to the effective and efficient administration of the Medicaid
program. The changes we propose aim to strike a balance that reflects
some States' current practices without putting strict limitations on
specific topics for discussion to all States. Broadening the scope of
the topics that the MAC and BAG discuss will benefit the State by
giving greater insight into how it is currently delivering care for its
beneficiaries and thereby assist in identifying ways to improve the way
the Medicaid program is administered.
The State will use this engagement with the MAC and BAG to ensure
that the beneficiary and interested parties' voices are considered and
to allow the opportunity to adjust course based on the feedback
provided by the committee and group members. Topics of discussion are
to be based on State need and determined in collaboration with the MAC
to address matters related to policy development and matters related to
the effective administration of the Medicaid program. These topics
could include new policy or program developments; changes to services;
coordination of care and quality of
[[Page 27971]]
services; eligibility, enrollment, and renewal processes; the review of
communications to beneficiaries by the State Medicaid agency and
Medicaid managed care plans; the provision of culturally and
linguistically appropriate services, health equity, disparities, and
biases in the Medicaid program; and other issues that impact the
provision or outcomes of health and medical care services in the
Medicaid program as identified by the MAC, the BAG, or the State.
We propose new paragraph (h) to expand on existing State
responsibilities for managing the MAC and BAG regarding staff
assistance, participation, and financial support. We understand from
States and other interested parties, that many States already provide
staffing and financial support to their MACs in ways that meet or going
beyond what we propose through our updated requirements. We believe
that expanding upon the current standards regarding State
responsibility for planning and executing the functions of the MAC and
BAG will ensure consistent and ongoing standards to further
beneficiaries' and interested parties' engagement. For example, we know
that when any kind of interested parties group meets, all members of
that group need to fully understand the topics being discussed in order
to meaningfully engage in that discussion. This is particularly
relevant when the topics of discussion are complex or based in specific
terminology as Medicaid related issues often can be.
We believe that when States provide their MACs and BAGs with
additional staffing support that can explain, provide background
materials, and meet with the members in preparation for the larger
discussions, the members have a greater chance to provide more
meaningful feedback and ensure that members are adequately prepared to
engage in these discussions. The proposed changes to the requirements
seek to create environments that support meaningful engagement by the
members of these groups whose feedback can then be used by States to
support the efficient administration of their Medicaid program. We
anticipate providing additional guidance on model practices,
recruitment strategies, and ways to facilitate beneficiary
participation, and we invite comments on effective strategies to ensure
meaningful interested parties' engagement that in turn can facilitate
full beneficiary participation.
Under the current MCAC regulations in Sec. 431.12(f), each State
is required to provide the committee with staff assistance from the
agency, independent technical assistance as needed to enable it to make
effective recommendations, and financial arrangements, if necessary, to
make possible the participation of beneficiary members. The changes we
propose include adding requirements regarding recruitment, meeting
scheduling, recordkeeping, and support for beneficiary members. The
overlap with the current regulation would mean much of the work to
implement our proposals, if finalized, would already be occurring.
The proposed requirement for beneficiary support, including
financial support, is similar to current requirements, such as using
dedicated staff to support beneficiary attendance at both the MAC and
BAG meetings and providing financial assistance to facilitate meeting
attendance by beneficiary members, as needed. Staff may support
beneficiary attendance through outreach to the Medicaid beneficiary MAC
and BAG members throughout the membership period to provide information
and answer questions; identify barriers and supports needed to
facilitate attendance at MAC and BAG meetings; and facilitate access to
those supports. We are not proposing changes to existing financial
support requirements. However, we are proposing an additional
requirement that at least one member of the State agency's executive
staff attend all MAC and BAG meetings to provide an opportunity for
beneficiaries and representatives of the State's leadership to interact
directly.
In the spirit of transparency and to ensure compliance with the
updated regulations, we propose new paragraph (i) to require that the
MAC, with support from the State and in accordance with the
requirements proposed at this section, submit an annual report to the
State. The BAG perspective and feedback will be embedded in the report,
since the Group is represented on the MAC. The State, in turn, would be
required to review the report and include responses to recommendations
in the report. Prior to finalizing the report, the State must allow the
MAC to perform a final review. Once the MAC completes its final review,
the State must publish it by posting it on its website. The proposed
requirements of this section seek to both ensure transparency while
also facilitating a feedback loop and view into the impact of the
committee and group's recommendations. We invite comment on additional
ways to ensure that the State can create a feedback loop with the MAC
and BAG.
Finally, we propose no changes to, and thus maintain, the current
regulatory language on FFP from current paragraph (g) to support
committee and group administration, to appear in new paragraph (j) with
conforming edits for new committee and group names.
This requirement, if finalized, would be effective 60 days after
the effective date of the final rule, which would provide States with 1
year to implement these requirements. We seek comment on whether 1 year
is too much or not enough time for States to implement the updates in
this regulation in an effective manner. We understand that States may
need to modify their current MCACs to reflect the updated requirements
and may also need to create the BAG and recruit members to participate,
if they do not already have a similar entity already in place.
B. Home and Community-Based Services (HCBS)
We are proposing both to amend and add new Federal HCBS
requirements to improve access to care, quality of care, and
beneficiary health and quality of life outcomes, while consistently
meeting the needs of all beneficiaries receiving Medicaid-covered HCBS.
This preamble discusses our proposed changes in the context of current
law.
We have previously received questions from States with
demonstration projects under section 1115 of the Act that include HCBS
about the applicability of other HCBS regulatory requirements. As a
result, we are identifying that, consistent with the applicability of
other HCBS regulatory requirements to such demonstration projects, the
proposed requirements for section 1915(c) waiver programs and section
1915(i), (j), and (k) State plan services included in this proposed
rule, if finalized, would apply to such services included in approved
section 1115 demonstration projects, unless we explicitly waive one or
more of the requirements as part of the approval of the demonstration
project. We are not proposing to apply the requirements for section
1915(c) waiver programs and section 1915(i), (j), and (k) State plan
services in this proposed rule to the Program of All-Inclusive Care of
the Elderly (PACE) authorized under sections 1894 and 1934 of the Act,
as the existing requirements for PACE either already address or exceed
the requirements outlined in this proposed rule, or are substantially
different from those for section 1915(c) waiver programs and section
1915(i), (j), and (k) State plan services.
[[Page 27972]]
1. Person-Centered Service Plans (42 CFR 441.301(c), 441.450(c),
441.540(c), and 441.725(c))
Section 1915(c)(1) of the Act requires that services provided
through section 1915(c) waiver programs be provided under a written
plan of care (hereinafter referred to as ``person-centered service
plans'' or ``service plans''). Existing Federal regulations at Sec.
441.301(c) address the person-centered planning process and include a
requirement at Sec. 441.301(c)(3) that the person-centered service
plan be reviewed and revised, upon reassessment of functional need, at
least every 12 months, when the individual's circumstances or needs
change significantly, or at the request of the individual.
In 2014, we released guidance for section 1915(c) waiver programs
\43\ (hereinafter the ``2014 guidance'') that included expectations for
State reporting of State-developed performance measures to demonstrate
compliance with section 1915(c) of the Act and the implementing
regulations in part 441, subpart G, through six assurances, including
assurances related to person-centered service plans. The 2014 guidance
indicated that States should conduct systemic remediation and implement
a Quality Improvement Project when they score below an 86 percent
threshold on any of their performance measures. The six assurances
identified in the 2014 guidance were the following:
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\43\ Modifications to Quality Measures and Reporting in Sec.
1915(c) Home and Community-Based Waivers. March 2014. Accessed at
https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_2.pdf.
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1. Level of Care: The State demonstrates that it implements the
processes and instrument(s) specified in its approved waiver for
evaluating/reevaluating an applicant's/waiver participant's level of
care consistent with care provided in a hospital, nursing facility, or
Intermediate Care Facility for Individuals with Intellectual
Disabilities;
2. Service Plan: The State demonstrates it has designed and
implemented an effective system for reviewing the adequacy of service
plans for waiver participants;
3. Qualified Providers: The State demonstrates that it has designed
and implemented an adequate system for assuring that all waiver
services are provided by qualified providers;
4. Health and Welfare: The State demonstrates it has designed and
implemented an effective system for assuring waiver participant health
and welfare;
5. Financial Accountability: The State demonstrates that it has
designed and implemented an adequate system for insuring financial
accountability of the waiver program; and
6. Administrative Authority: The Medicaid Agency retains ultimate
administrative authority and responsibility for the operation of the
waiver program by exercising oversight of the performance of waiver
functions by other State and local/regional non-State agencies (if
appropriate) and contracted entities.\44\
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\44\ Performance measures were required for delegated functions
unless the delegated functions were covered by performance measures
associated with other assurances.
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We are proposing a different approach for States to demonstrate
that they meet the statutory requirements in section 1915(c) of the Act
and the regulatory requirements in part 441, subpart G, including the
requirements regarding assurances around service plans. The proposed
approach is based on feedback CMS obtained during various public
engagement activities conducted with States and other interested
parties over the past several years about the reporting discussed in
the 2014 guidance, as well as feedback received through the RFI \45\
discussed earlier about the need to standardize reporting and set
minimum standards for HCBS. Accordingly, the proposed HCBS requirements
in this rulemaking are intended to establish a new strategy for
oversight, monitoring, quality assurance, and quality improvement for
section 1915(c) waiver programs. The proposed approach focuses on
priority areas that have been identified by States, oversight entities,
consumer advocacy organizations, and other interested parties. The
priority areas are person-centered planning, health and welfare,
access, beneficiary protections, and quality improvement. As part of
this approach, we propose to establish new minimum performance
requirements and new reporting requirements for section 1915(c) waiver
programs that are intended to supersede and fully replace the reporting
requirements and the 86 percent performance level threshold for
performance measures described in the 2014 guidance. Further, to ensure
consistency and alignment across HCBS authorities, we propose to apply
the proposed requirements for section 1915(c) waiver programs to
section 1915(i), (j), and (k) State plan services as appropriate.
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\45\ CMS Request for Information: Access to Coverage and Care in
Medicaid & CHIP. February 2022. For a full list of question from the
RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
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Under section 1902(a)(19) of the Act, States must provide
safeguards to assure that eligibility for Medicaid-covered care and
services will be determined and provided in a manner that is consistent
with simplicity of administration and that is in the best interest of
Medicaid beneficiaries. While the needs of some individuals who receive
HCBS may be relatively stable over some time periods, individuals who
receive HCBS experience changes in their functional needs and
individual circumstances, such as the availability of natural supports
or a desire to choose a different provider, that necessitate revisions
to the person-centered service plan to remain as independent as
possible or to prevent adverse outcomes. The requirements to reassess
functional need and to update the person-centered service plan based on
the results of the reassessment, when circumstances or needs change
significantly, or at the request of the individual are important
safeguards that are in the best interest of beneficiaries because they
ensure that an individual's section 1915(c) waiver program services
change to meet the beneficiary's needs most appropriately as those
needs change. Section 2402(a) of the Affordable Care Act (Pub. L. 111-
148 and Pub. L. 111-152) requires the Secretary of HHS to ensure that
all States receiving Federal funds for HCBS, including Medicaid,
develop HCBS systems that are responsive to the needs and choices of
beneficiaries receiving HCBS, maximize independence and self-direction,
provide support and coordination to facilitate the participant's full
engagement in community-life, and achieve a more consistent and
coordinated approach to the administration of policies and procedures
across public programs providing HCBS.\46\ In particular, section
2402(a)(1) of the Affordable Care Act requires States to allocate
resources for services in a manner that is responsive to the changing
needs and choices of beneficiaries receiving HCBS and to provide
strategies for beneficiaries receiving such services to maximize their
independence, while section 2402(a)(2) of the Affordable Care Act
requires States to provide beneficiaries who need HCBS with the support
and coordination needed to design a plan based on individual
preferences and
[[Page 27973]]
personal goals that support their full engagement in community life.
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\46\ Section 2402(a) of the Affordable Care Act--Guidance for
Implementing Standards for Person-Centered Planning and Self-
Direction in Home and Community-Based Services Programs. Accessed at
https://acl.gov/sites/default/files/news%202016-10/2402-a-Guidance.pdf.
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Effective State implementation of the person-centered planning
process is integral to ensuring compliance with section 2402 of the
Affordable Care Act. This is because this process is how States
identify and document the service needs and choices of people receiving
HCBS, plan for delivering individualized services that promote
independence and self-direction, effectively coordinate services and
supports necessary for community living, and ensure that the services
and supports that people receive are responsive to their changing needs
and choices. Each component of the person-centered planning process,
including the functional assessment, developing and implementing the
person-centered service plan, and periodically reassessing and updating
of the service plan, are essential to ensuring States' compliance with
sections 2402(a)(1) and (2) of the Affordable Care Act.
Since the release of the 2014 guidance, we have received feedback
from States, the OIG, ACL, and OCR, and other interested parties on how
crucial person-centered planning is in the delivery of care and the
significance of the person-centered service plan for the assurance of
health and welfare for section 1915(c) waiver program participants. The
importance of the person-centered planning process to the assurance of
health and welfare is supported by the existing regulatory requirements
for section 1915(c) waivers, which indicate, at Sec.
441.301(c)(2)(vi), that person-centered service plans must ``reflect
risk factors and measures in place to minimize them, including
individualized back-up plans and strategies when needed'' and, at Sec.
441.301(c)(2)(xiii)(H), that person-centered service plans must
``include an assurance that interventions and supports will cause no
harm to the individual.'' As such, if States fail to conduct the
required reassessment and updating of the person-centered service plan,
they could increase the risk of harm for beneficiaries by not
identifying risk factors and measures to minimize them and by not
taking the steps necessary to assure that interventions and supports
will not cause harm.
To ensure a more consistent application of person-centered service
plan requirements across States and to protect the health and welfare
of section 1915(c) waiver participants, we propose under our authority
at sections 1915(c)(1) and 1902(a)(19) of the Act and section
2402(a)(1) and (2) of the Affordable Care Act, to codify a minimum
performance level to demonstrate that States meet the requirements at
Sec. 441.301(c)(3). Specifically, at new Sec. 441.301(c)(3)(ii)(A),
we propose to require that States demonstrate that a reassessment of
functional need was conducted at least annually for at least 90 percent
of individuals continuously enrolled in the waiver for at least 365
days. We also propose, at new Sec. 441.301(c)(3)(ii)(B), to require
that States demonstrate that they reviewed the person-centered service
plan and revised the plan as appropriate based on the results of the
required reassessment of functional need at least every 12 months for
at least 90 percent of individuals continuously enrolled in the waiver
for at least 365 days.
We considered whether to propose to codify the minimum 86 percent
performance level that was outlined in the 2014 guidance, instead of
the minimum 90 percent performance level we are now proposing. The
minimum 86 percent performance level was intended to provide States
with a reasonable threshold for demonstrating compliance with the
requirements at Sec. 441.301(c)(3). However, since we released the
2014 guidance, we have heard from many interested parties that a
minimum 86 percent performance level may not be sufficient to
demonstrate that a State is meeting these requirements. The key concern
expressed is that this performance level provides States with more
latitude than is necessary to account for unexpected delays in the
timeframe for conducting reassessments and updating service plans, as
States should assume that some delays are likely and account for them
as part of their reassessment and service planning processes. Further,
media and anecdotal reports indicate that re-assessment and care
planning processes are often delayed without valid reasons, which
suggests that beneficiaries may be at risk for preventable harm due to
unnecessary delays in person-centered planning processes and that we
should establish a more stringent threshold for States to demonstrate
compliance with the requirements at Sec. 441.301(c)(3). In response to
the feedback we have received since 2014, we are proposing a slight
increase to the minimum performance level outlined in the 2014
guidance. This proposed minimum performance level is intended to
strengthen person-centered planning requirements based on feedback we
have received, while also recognizing that there may be legitimate
reasons why assessment and care planning processes occasionally are not
completed timely in all instances.
We also considered whether to propose allowing good cause
exceptions to the minimum performance level in the event of a natural
disaster, public health emergency, or other event that would negatively
impact a State's ability to achieve a minimum 90 percent performance
level. In the end, we decided not to propose good cause exceptions
because the minimum 90 percent performance level is intended to account
for various scenarios that might impact a State's ability to achieve
these minimum performance levels. Further, there are existing disaster
authorities that States could utilize to request a waiver of these
requirements in the event of a public health emergency or a disaster.
We invite comment on these proposals.
At Sec. 441.301(c)(3), we are also proposing to move the sentence
beginning with ``The person-centered service plan must be reviewed . .
.'' to a new paragraph at Sec. 441.301(c)(3)(i) and to reposition the
regulatory text under the proposed title, Requirement. In addition, we
are proposing to revise the regulatory text at the renumbered
paragraph, which currently says, ``The person-centered service plan
must be reviewed, and revised upon reassessment of functional need as
required by Sec. 441.365(e), at least every 12 months, when the
individual's circumstances or needs change significantly, or at the
request of the individual'' to read, ``The State must ensure that the
person-centered service plan is reviewed, and revised, as appropriate,
based upon the reassessment of functional need as required by Sec.
441.365(e), at least every 12 months, when the individual's
circumstances or needs change significantly, or at the request of the
individual.'' We are proposing this revision to the regulatory text so
that it is clearer that the State is the required actor under Sec.
441.301(c)(3). We are also proposing this revision to the regulatory
text so that it is clear that changes to the person-centered service
plan are not required if the reassessment does not indicate a need for
changes. With this proposed revision to the regulatory text, a State
could, for instance, meet the requirement that the person-centered
service plan was reviewed and revised as appropriate based on the
results of the required reassessment of functional need by documenting
that there were no changes in functional needs or the individual's
circumstances upon reassessment that necessitated changes to the
service plan.
[[Page 27974]]
Section 2402(a)(3)(A) of the Affordable Care Act requires States to
improve coordination among, and the regulation of, all providers of
Federally and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In the
context of Medicaid coverage of HCBS, it should not matter whether the
services are covered directly on an FFS basis or by a managed care
entity to its enrollees. The requirement for ``consistent
administration'' should require consistency between these two modes of
service delivery. Accordingly, we are proposing to specify that a State
must ensure compliance with the requirements in Sec. 441.301(c)(3),
with respect to HCBS delivered under both FFS and managed care delivery
systems. To ensure consistency in person-centered service plan
requirements between FFS and managed care delivery systems, we propose
to add the requirements at Sec. 441.301(c)(3) to 42 CFR 438.208(c).
We also propose updates to existing language describing the person-
centered planning process specific to section 1915(c) waivers. Current
language describes the role of an individual's authorized
representative as if every waiver participant will require an
authorized representative, which is not the case and has been a source
of confusion for States and providers. We propose to remove extraneous
language from the regulation text at Sec. 441.301(c)(1) to now read:
``The individual, or if applicable, the individual and the individual's
authorized representative, will lead the person-centered planning
process. When the term `individual' is used throughout this section, it
includes the individual's authorized representative if applicable. In
addition, the person-centered planning process: . . .'' This proposed
language brings the section 1915(c) waiver regulatory text in line with
person-centered planning process language in both the section 1915(j)
and (k) State plan options.
We recognize that many States may need time to implement these
proposed requirements, including time to amend provider agreements or
managed care contracts, make State regulatory or policy changes,
implement process or procedural changes, update information systems for
data collection and reporting, or conduct other activities to implement
these requirements. As a result, we are proposing at Sec.
441.301(c)(3)(iii) to make the performance levels under Sec.
441.301(c)(3)(ii) effective 3 years after the effective date of Sec.
441.301(c)(3) (in other words, 3 years after the effective date of the
final rule) in FFS delivery systems. For States with managed care
delivery systems under the authority of sections 1915(a), 1915(b),
1932(a), or 1115(a) of the Act that include HCBS in the managed care
organization's (MCO), prepaid inpatient health plan's (PIHP), or
prepaid ambulatory health plan's (PAHP) contract, we are proposing to
provide States until the first managed care plan contract rating period
that begins on or after 3 years after the effective date of the final
rule to implement these requirements. This time period is based on
feedback from States and other interested parties that it could take 2
to 3 years to amend State regulations and work with their State
legislatures, if needed, as well as to revise policies, operational
processes, information systems, and contracts to support implementation
of the proposals outlined in this section. We also considered this
proposed timeframe based on all of the HCBS proposals outlined in this
proposed rule as whole. We invite comments on whether this timeframe is
sufficient, whether we should require a shorter timeframe (2 years) or
longer timeframe (4 years) to implement these provisions, and if an
alternate timeframe is recommended, the rationale for that alternate
timeframe. As noted previously, the proposed requirements at Sec.
441.301(c)(3), in combination with new proposed reporting requirements
at Sec. 441.311(b)(3) and other proposed requirements identified
throughout this proposed rule, are intended to supersede and fully
replace the reporting requirements and the required minimum 86 percent
performance level for performance measures described in the 2014
guidance. We expect that States may implement some of the requirements
proposed in this proposed rule in advance of the effective date. We
will work with States to phase-out the requirements in the 2014
guidance as they implement the future requirements that become part of
the final rule to reduce unnecessary burden and to avoid duplicative or
conflicting reporting requirements.
As discussed earlier in this section of the preamble, section
2402(a)(3)(A) of the Affordable Care Act requires States to improve
coordination among, and the regulation of, all providers of Federally
and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In
accordance with the requirement of section 2402(a)(3)(A) of the
Affordable Care Act for States to achieve a more consistent
administration of policies and procedures across HCBS programs and
because HCBS State plan options have similar person-centered planning
and service plan requirements, we are proposing to incorporate these
new requirements within the applicable HCBS regulatory sections.
Specifically, we propose to apply the proposed requirements at Sec.
441.301(c)(3) to section 1915(j), (k), and (i) State plan services by
cross-referencing at Sec. Sec. 441.450(c), 441.540(c), and 441.725(c),
respectively. Consistent with our proposal for section 1915(c) waivers,
we propose these requirements under section 1902(a)(19) of the Act,
which authorizes safeguards necessary to assure that eligibility for
care and services under the Medicaid program will be determined, and
such care and services will be provided, in a manner consistent with
the best interest of beneficiaries. We believe the same reasons for
proposing these requirements for section 1915(c) waivers are equally
applicable for these other HCBS authorities and are also responsive to
feedback we have received from States and interested parties over the
years requesting consistency of requirements across HCBS authorities.
We request comment on the application of these provisions to section
1915(i), (j), and (k) authorities.
Finally, we considered whether to also apply these proposed
requirements to section 1905(a) ``medical assistance'' State plan
personal care, home health, and case management services. However, we
are not proposing that these requirements apply to any section 1905(a)
State plan services at this time, based on State feedback that States
do not have the same data collection and reporting capabilities for
these services as they do for other HCBS at section 1915(c), (i), (j),
and (k), and because the person-centered planning and service plan
requirements for section 1905(a) services are substantially different
from those for section 1915(c), (i), (j), and (k) services.
Specifically, there are requirements for a ``comprehensive assessment
and periodic reassessment of individual needs'' and ``development (and
periodic revision) of a specific care plan based on the information
collected through the assessment'' under Sec. 440.169(d) for the
provision of case management services. There are also requirements for
a ``plan of treatment'' (or, at the option of the State, a ``service
plan'') under Sec. 440.167 for the provision of personal care
services. However, Sec. Sec. 440.169(d) and 440.167 do not include
specific timeframes that could be used to establish minimum
[[Page 27975]]
performance thresholds that would be similar to those proposed for
section 1915(c) waivers. A face-to-face encounter within the 90 days
before or within the 30 days after the start of the services is
required at Sec. 440.70(f)(1) for the initiation of home health
services, and a written plan of care that the ordering practitioner
reviews every 60 days for services is required under Sec. 440.70(a)(2)
for the provision of home health services. However, the proposed
minimum thresholds for section 1915(c) waiver services would be
incompatible with the required timeframes under Sec. 440.70(a)(2) and
(f)(1). Person-centered planning and service plan requirements are not
required by Medicaid for other section 1905(a) services, although we
recommend that States implement person-centered planning process for
all HCBS. We note that the vast majority of HCBS is delivered under
section 1915(c), (i), (j), and (k) authorities, while only a small
percentage of HCBS nationally is delivered under section 1905(a) State
plan authorities. However, the small overall percentage includes large
numbers of people with mental health needs who receive case management.
We request comment on whether we should establish similar person-
centered planning and service plan requirements for section 1905(a)
State plan personal care, home health, and case management services.
2. Grievance System (Sec. Sec. 441.301(c)(7), 441.464(d)(2)(v),
441.555(b)(2)(iv), and 441.745(a)(1)(iii))
As discussed earlier in section II.B.1., of this preamble, section
2402(a) of the Affordable Care Act requires the Secretary of HHS to
ensure that all States receiving Federal funds for HCBS, including
Medicaid HCBS, develop HCBS systems that are responsive to the needs
and choices of beneficiaries receiving HCBS, maximize independence and
self-direction, provide support and coordination to assist with a
community-supported life, and achieve a more consistent and coordinated
approach to the administration of policies and procedures across public
programs providing HCBS.\47\ Among other things, section
2402(a)(3)(B)(ii) of the Affordable Care Act requires development and
monitoring of an HCBS complaint system. Further, section 1902(a)(19) of
the Act requires States to provide safeguards to assure that
eligibility for Medicaid-covered care and services will be determined
and provided in a manner that is consistent with simplicity of
administration and the best interest of Medicaid beneficiaries.
---------------------------------------------------------------------------
\47\ Section 2402(a) of the Affordable Care Act--Guidance for
Implementing Standards for Person-Centered Planning and Self-
Direction in Home and Community-Based Services Programs. Accessed at
https://acl.gov/sites/default/files/news%202016-10/2402-a-Guidance.pdf.
---------------------------------------------------------------------------
Federal regulations at 42 CFR part 431, subpart E require States to
provide Medicaid applicants and beneficiaries with an opportunity for a
fair hearing before the State Medicaid agency in certain circumstances,
including for a termination, suspension, or reduction of Medicaid
eligibility, or for a termination, suspension, or reduction in benefits
or services. These fair hearing rights apply to all Medicaid applicants
and beneficiaries, including those receiving HCBS regardless of the
delivery system. Under 42 CFR part 438, subpart F, Medicaid managed
care plans must have in place: an appeal system that allows a Medicaid
managed care enrollee to request an appeal, which is a review by the
Medicaid managed care plan of an adverse benefit determination issued
by the plan; and a grievance system, which allows a Medicaid managed
care enrollee to file an expression of dissatisfaction with the plan
about any matter other than an adverse benefit determination. Note that
if a Medicaid managed care enrollee exhausts the Medicaid managed care
plan's appeals process, the enrollee may request a fair hearing before
the State Medicaid agency. Medicaid managed care enrollees cannot
request a fair hearing for grievances because grievances are not
generally related to the direct provision of services. Section
1902(a)(3) of the Act provides for the opportunity for a State fair
hearing when a ``claim for medical assistance under the plan is denied
or is not acted upon with reasonable promptness.'' This structure
creates a disparity for FFS HCBS beneficiaries, as it does not provide
for a venue to raise concerns about issues that HCBS beneficiaries may
experience which are not subject to the fair hearing process, such as
the failure of a provider to comply with the HCBS settings requirements
at Sec. 441.301(c)(4) (note that these are issues for which a managed
care enrollee could file a grievance with their plan).
Under our authority at section 1902(a)(19) of the Act and section
2402(a)(3)(B)(ii) of the Affordable Care Act, we propose to require at
new Sec. 441.301(c)(7) that States establish grievance procedures for
Medicaid beneficiaries receiving section 1915(c) waiver program
services through an FFS delivery system. Specifically, we propose at
Sec. 441.301(c)(7) that States must establish a procedure under which
a beneficiary can file a grievance related to the State's or a
provider's compliance with the person-centered planning and service
plan requirements at Sec. Sec. 441.301(c)(1) through (3) and the HCBS
settings requirements at Sec. Sec. 441.301(c)(4) through (6). This
proposal is based on feedback obtained during various public engagement
activities conducted with interested parties over the past several
years about the need for beneficiary grievance processes in section
1915(c) waiver programs related to these requirements. However, to
avoid duplication with the grievance requirements at part 438, subpart
F, we are not proposing to apply this requirement to establish a
grievance procedure to managed care delivery systems. We note, though,
that the proposals in this section are similar to requirements for
managed care grievance requirements found at part 438, subpart F, with
any differences reflecting changes appropriate for FFS systems. The
proposed requirements included at Sec. 441.301(c)(7) in this proposed
rule are focused specifically on grievance systems and do not establish
new fair hearing system requirements, as appeals of adverse eligibility
and/or benefit or service determinations are addressed by existing fair
hearing requirements at 42 CFR part 431, subpart E. We welcome comments
on any additional changes we should consider in this section.
As discussed earlier in this section of the preamble, section
2402(a)(3)(B)(ii) of the Affordable Care Act requires development and
monitoring of an HCBS complaint system. In addition, section
2402(a)(3)(A) of the Affordable Care Act requires the Secretary of HHS
to ensure that all States receiving Federal funds for HCBS, including
Medicaid HCBS, develop HCBS systems that achieve a more consistent and
coordinated approach to the administration of policies and procedures
across public programs providing HCBS. As such, we believe the
requirement for States to establish grievance procedures for Medicaid
beneficiaries receiving section 1915(c) waiver program services through
a FFS delivery system are necessary to comply with the HCBS complaint
system requirements at section 2402(a)(3)(B)(ii) and to ensure
consistency in the administration of HCBS between managed care and FFS
delivery systems. Further, in the absence of a grievance system
requirement for FFS HCBS programs, States may not have established
processes and systems for people receiving section 1915(c) waiver
program services through FFS delivery
[[Page 27976]]
systems to express dissatisfaction with or voice concerns related to
States' compliance with the person-centered planning and service plan
requirements at Sec. 441.301(c)(1) through (3) and the HCBS settings
requirements at Sec. 441.301(c)(4) through (6), as such concerns are
not subject to the existing fair hearing process at 42 CFR part 431
subpart E. As a result, we believe the proposal for a grievance system
for FFS HCBS programs is necessary to assure that care and services
will be provided in a manner that is in the best interests of the
beneficiaries, as required by section 1902(a)(19) of the Act.
We have specifically focused this requirement on States' and
providers' compliance with the person-centered planning and service
plan requirements at Sec. 441.301(c)(1) through (3) and the HCBS
settings requirements at Sec. 441.301(c)(4) through (6) because of the
critical role that person-centered planning and the service plan play
in appropriate care delivery for people receiving HCBS. Additionally,
we have focused the grievance system requirements on the HCBS settings
requirements because of the importance of the HCBS settings
requirements to ensuring that HCBS beneficiaries have full access to
the benefits of community living and are able to receive services in
the most integrated setting appropriate to their needs. Beneficiary
advocates and other interested parties have also indicated to us that
these are especially important areas for which to ensure that grievance
processes are in place for all Medicaid beneficiaries receiving HCBS.
Further, focusing the grievance systems requirements on the person-
centered planning and service plan requirements at Sec. 441.301(c)(1)
through (3) and the HCBS settings requirements at Sec. 441.301(c)(4)
through (6) helps to ensure that the proposed grievance requirements do
not duplicate or conflict with existing fair hearing requirements at
part 431, subpart E, as HCBS settings requirements and person-centered
planning requirements are outside the scope of the fair hearing
requirements.
At Sec. 441.301(c)(7)(ii)(A), we propose to define ``grievance''
as an expression of dissatisfaction or complaint related to the State's
or a provider's compliance with the person-centered planning and
service plan requirements at Sec. 441.301(c)(1) through (3) and the
HCBS settings requirements at Sec. 441.301(c)(4) through (6),
regardless of whether the beneficiary requests that remedial action be
taken to address the area of dissatisfaction or complaint. At Sec.
441.301(a)(7)(ii)(B), we also propose to define ``grievance system'' as
the processes the State implements to handle grievances, as well as the
processes to collect and track information about them. To ensure
consistency in the administration of HCBS between managed care and FFS
delivery systems, we based these definitions on the definitions at part
438, subpart F.
At Sec. 441.301(c)(7)(iii)(A) through (C), we propose new general
requirements for States' grievance procedures. Specifically, at Sec.
441.301(c)(7)(iii)(A), we propose to require that a beneficiary or
authorized representative be permitted to file a grievance. Under the
proposal, another individual or entity may file a grievance on a
beneficiary's behalf, so long as the beneficiary or authorized
representative provides written consent. Our proposal would not permit
a provider to file a grievance that would violate conflict of interest
guidelines, which States are required to have in place under Sec.
441.540(a)(5). At Sec. 441.301(c)(7)(iii)(A), we also propose to
specify that all references to beneficiary in the regulatory text of
this section includes the beneficiary's representative, if applicable.
At Sec. 441.301(c)(7)(iii)(B)(1) through (7), we propose to
require States to:
Have written policies and procedures for their grievance
processes that at a minimum meet the requirements of this proposed
section and serve as the basis for the State's grievance process;
Provide beneficiaries with reasonable assistance in
completing the forms and procedural steps related to grievances and to
ensure that the grievance system is consistent with the availability
and accessibility requirements at Sec. 435.905(b);
Ensure that punitive action is not threatened or taken
against an individual filing a grievance;
Accept grievances, requests for expedited resolution of
grievances, and requests for extensions of timeframes from
beneficiaries;
Provide beneficiaries with notices and other information
related to the grievance system, including information on their rights
under the grievance system and on how to file grievance, and ensure
that such information is accessible for individuals with disabilities
and individuals who are limited English proficient in accordance with
Sec. 435.905(b);
Review grievance resolutions with which beneficiaries are
dissatisfied; and
Provide information on the grievance system to providers
and subcontractors approved to deliver services under section 1915(c)
of the Act.
At Sec. 441.301(c)(7)(iii)(C)(1) through (5), we propose to
require that the processes for handling grievances must:
Allow beneficiaries to file a grievance either orally or
in writing;
Acknowledge receipt of each grievance;
Ensure that decisions on grievances are not made by anyone
previously involved in review or decision-making related to the problem
or issue for which the beneficiary has filed a grievance or a
subordinate of such an individual, are made by individuals with
appropriate expertise, and are made by individuals who consider all of
the information submitted by the beneficiary related to the grievance;
Provide beneficiaries with a reasonable opportunity, face-
to-face (including through the use of audio or video technology) and in
writing, to present evidence and testimony and make legal and factual
arguments related to their grievance;
Provide beneficiaries, free of charge and in advance of
resolution timeframes, with their own case files and any new or
additional evidence used or generated by the State related to the
grievance; and
Provide beneficiaries, free of charge, with language
services, including written translation and interpreter services in
accordance with 435.905(b), to support their participation in grievance
processes and their use of the grievance system.
At Sec. 441.301(c)(7)(iv)(A), we propose to require that the
beneficiary be able to file a grievance at any time. At Sec.
441.301(c)(7)(iv)(B), we propose to require that beneficiaries be
permitted to request expedited resolution of a grievance, whenever
there is a substantial risk that resolution within standard timeframes
will adversely affect the beneficiary's health, safety, or welfare,
such as if, for example, a beneficiary cannot access personal care
services authorized in the person-centered service plan.
At Sec. 441.301(c)(7)(v), we propose resolution and notification
requirements for grievances. Specifically, at Sec.
441.301(c)(7)(v)(A), we propose to require that States resolve and
provide notice of resolution related to each grievance as quickly as
the beneficiary's health, safety, and welfare requires and within
State-established timeframes that do not exceed the standard and
expedited timeframes proposed in Sec. 441.301(c)(7)(v)(B). At Sec.
441.301(c)(7)(v)(B)(1), we propose to require that standard resolution
of a grievance and notice to affected parties must occur within 90
calendar days of receipt of the grievance. At
[[Page 27977]]
Sec. 441.301(c)(7)(v)(B)(2), we propose to require that expedited
resolution of a grievance and notice must occur within 14 calendar days
of receipt of the grievance.
At Sec. 441.301(c)(7)(v)(C), we propose that States be permitted
to extend the timeframes for the standard resolution and expedited
resolution of grievances by up to 14 calendar days if the beneficiary
requests the extension, or the State documents that there is need for
additional information and how the delay is in the beneficiary's
interest. At Sec. 441.301(c)(7)(v)(D), we propose to require that
States make reasonable efforts to give the beneficiary prompt oral
notice of the delay, give the beneficiary written notice, within 2
calendar days of determining a need for a delay but no later than the
timeframes in paragraph (c)(7)(v)(B), of the reason for the decision to
extend the timeframe, and resolve the grievance as expeditiously as the
beneficiary's health condition requires and no later than the date the
extension expires, if the State extends the timeframe for a standard
resolution or an expedited resolution.
We note that the proposed requirements at Sec.
441.301(c)(7)(iv)(B) that beneficiaries be permitted to request
expedited resolution of a grievance and at Sec. 441.301(c)(7)(v)(B)(2)
related to the timeframe for expedited resolution of a grievance and
notice differ from the current grievance system requirements for
Medicaid managed care plans at part 438, subpart F, which do not
include specific requirements for an expedited resolution of a
grievance. We invite comment on whether part 438, subpart F should be
amended to include the proposed requirements at Sec.
441.301(c)(7)(iv)(B) and at Sec. 441.301(c)(7)(v)(B)(2).
Proposed Sec. 441.301(c)(7)(vi) describes proposed requirements
related to the notice of resolution for beneficiaries. Specifically, at
Sec. 441.301(c)(7)(vi)(A), we propose to require that States establish
a method for written notice to beneficiaries and that the method meet
the availability and accessibility requirements at Sec. 435.905(b). At
Sec. 441.301(c)(7)(vi)(B), we propose to require that States make
reasonable efforts to provide oral notice of resolution for expedited
resolutions.
Proposed Sec. 441.301(c)(7)(vii) lists proposed recordkeeping
requirements related to grievances. Specifically, at Sec.
441.301(c)(7)(vii)(A), we propose to require that States maintain
records of grievances and review the information as part of their
ongoing monitoring procedures. At Sec. 441.301(c)(7)(vii)(B)(1)
through (6), we propose to require that the record of each grievance
must contain the following information at a minimum: a general
description of the reason for the grievance, the date received, the
date of each review or review meeting (if applicable), resolution and
date of the resolution of the grievance (if applicable), and the name
of the beneficiary for whom the grievance was filed. Further, at Sec.
441.301(c)(7)(vii)(C), we propose to require that grievance records be
accurately maintained and in a manner that would be available upon our
request.
We recognize that many States may need time to implement these
requirements, including to amend provider agreements, make State
regulatory or policy changes, implement process or procedural changes,
update information systems for data collection and reporting, or
conduct other activities to implement these requirements. However, we
also recognize that the absence of a grievance system in FFS HCBS
systems poses a substantial risk of harm to beneficiaries. As a result,
we are proposing at Sec. 441.301(c)(7)(viii) that the requirement at
Sec. 441.301(c)(7) be effective 2 years after the effective date of
the final rule. A 2-year time period after the effective date of the
final rule for States to implement these requirements reflects our
attempt to balance two competing challenges: (1) the fact that there is
a gap in existing regulations for FFS HCBS grievance processes related
to important HCBS beneficiary protection issues involving person-
centered planning and HCBS settings requirements; and (2) feedback from
States and other interested parties that it could take 1 to 2 years to
amend State regulations and work with their State legislatures, if
needed, as well as to revise policies, operational processes,
information systems, and contracts to support implementation of the
proposals outlined in this section. We also considered all of the HCBS
proposals outlined in this proposed rule as whole. We invite comments
on overall burden for States to meet the requirements of this section,
whether this timeframe is sufficient, whether we should require a
shorter timeframe (1 year to 18 months) or longer timeframe (3 to 4
years) to implement these provisions, and if an alternate timeframe is
recommended, the rationale for that alternate timeframe.
As discussed earlier in section II.B.1. of this preamble, section
2402(a)(3)(A) of the Affordable Care Act requires States to improve
coordination among, and the regulation of, all providers of Federally
and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In
accordance with the requirement of section 2402(a)(3)(A) of the
Affordable Care Act for States to achieve a more consistent
administration of policies and procedures across HCBS programs and
because HCBS State plan options also must comply with the HCBS Settings
Rule and with similar person-centered planning and service plan
requirements, we are proposing to incorporate these grievance
requirements within the applicable regulatory sections. Specifically,
we propose to apply these proposed requirements in Sec. 441.301(c)(7)
to sections 1915(j), (k), and (i) State plan services by cross-
referencing at Sec. Sec. 441.464(d)(2)(v), 441.555(b)(2)(iv), and
441.745(a)(1)(iii), respectively.
Consistent with our proposal for section 1915(c) waivers, we
propose to apply the proposed grievance requirements in Sec.
441.301(c)(7) to sections 1915(j), (k), and (i) State plan services
based on our authority under section 1902(a)(19) of the Act to assure
that there are safeguards for beneficiaries and our authority at
section 2402(a)(3)(B)(ii) of the Affordable Care Act to require a
complaint system for beneficiaries. We believe the same arguments for
proposing these requirements for section 1915(c) waivers are equally
applicable to these other HCBS authorities. We request comment on the
application of the grievance system provisions to section 1915(i), (j),
and (k) authorities. We note that in the language added to Sec.
441.464(d)(2)(v), we identify that the proposed grievance requirements
apply when self-directed personal assistance services authorized under
section 1915(j) include services under a section 1915(c) waiver
program. As described later in this section of this proposed rule, we
have not proposed to apply these requirements to section 1905(a)
services; section 1905(a) personal care services are the other service
authorized under section 1915(j) authorities to be self-directed.
[[Page 27978]]
We considered whether to also apply the proposed requirements to
section 1905(a) ``medical assistance'' State plan personal care, home
health, and case management services. However, we are not proposing
that these requirements apply to any section 1905(a) State plan
services because section 1905(a) services are not required to comply
with HCBS settings requirements and because the person-centered
planning and service plan requirements for most section 1905(a)
services are substantially different from those for section 1915(c),
(i), (j), and (k) services. Further, the vast majority of HCBS is
delivered under section 1915(c), (i), (j), and (k) authorities, while
only a small percentage of HCBS nationally is delivered under section
1905(a) State plan authorities. We request comment on whether we should
establish grievance requirements for section 1905(a) State plan
personal care, home health, and case management services.
3. Incident Management System (Sec. Sec. 441.302(a)(6), 441.464(e),
441.570(e), and 441.745(a)(1)(v))
Section 1902(a)(19) of the Act requires States to provide
safeguards as may be necessary to assure that eligibility for care and
services will be determined, and that ``such care and services will be
provided,'' in a manner consistent with simplicity of administration
and ``the best interests of the recipients.'' Section 1915(c)(2)(A) of
the Act and current Federal regulations at Sec. 441.302(a) require
that States have in place necessary safeguards to protect the health
and welfare of individuals receiving section 1915(c) waiver program
services. Further, as discussed previously in section II.B.1. of this
preamble, section 2402(a) of the Affordable Care Act requires the
Secretary of HHS to ensure that all States receiving Federal funds for
HCBS, including Medicaid, develop HCBS systems that are responsive to
the needs and choices of beneficiaries receiving HCBS, maximize
independence and self-direction, provide support and coordination to
assist with a community-supported life, and achieve a more consistent
and coordinated approach to the administration of policies and
procedures across public programs providing HCBS.\48\ Among other
things, section 2402(a)(3)(B)(ii) of the Affordable Care Act requires
development and oversight of a system to qualify and monitor providers.
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\48\ Section 2402(a) of the Affordable Care Act--Guidance for
Implementing Standards for Person-Centered Planning and Self-
Direction in Home and Community-Based Services Programs. Accessed at
https://acl.gov/sites/default/files/news%202016-10/2402-a-Guidance.pdf.
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As noted earlier in section II.B.1. of this preamble we released
guidance for section 1915(c) waiver programs in 2014 which noted that
States should report on State-developed performance measures to
demonstrate that they meet six assurances, including a Health and
Welfare assurance for States to demonstrate that they have designed and
implemented an effective system for assuring waiver participant health
and welfare. Specifically, the 2014 guidance highlighted, related to
the Health and Welfare assurance, the following:
The State demonstrates on an ongoing basis that it
identifies, addresses, and seeks to prevent instances of abuse,
neglect, exploitation, and unexplained death;
The State demonstrates that an incident management system
is in place that effectively resolves incidents and prevents further
similar incidents to the extent possible;
The State policies and procedures for the use or
prohibition of restrictive interventions (including restraints and
seclusion) are followed;
The State establishes overall health care standards and
monitors those standards based on the responsibility of the service
provider as stated in the approved waiver.
Consistent with the expectations for other performance measures,
the 2014 guidance noted that States should conduct systemic remediation
and implement a Quality Improvement Project when they score below 86
percent on any of their Health and Welfare performance measures.
Despite States implementing these statutory and regulatory
requirements to protect the health and welfare of individuals receiving
section 1915(c) waiver program services, and States' adherence to
related subregulatory guidance, there have been notable and high-
profile instances of abuse and neglect in recent years that highlight
the risks associated with poor quality care and with inadequate
oversight of HCBS in Medicaid. For example, a 2018 report, ``Ensuring
Beneficiary Health and Safety in Group Homes Through State
Implementation of Comprehensive Compliance Oversight,'' \49\ (referred
to as the Joint Report, developed by ACL, OCR, and the OIG), found
systemic problems with health and safety policies and procedures being
followed in group homes and that failure to comply with these policies
and procedures left beneficiaries in group homes at risk of serious
harm.
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\49\ Ensuring Beneficiary Health and Safety in Group Homes
Through State Implementation of Comprehensive Compliance Oversight.
US Department of Human Services, Office of the Inspector General,
Administration for Community Living, and Office for Civil Rights.
January 2018. Accessed at https://oig.hhs.gov/reports-and-publications/featured-topics/group-homes/group-homes-joint-report.pdf.
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In addition, in 2016 and 2017, OIG released several reports on
their review of States' compliance with Federal and State requirements
regarding critical incident reporting and monitoring.
50 51 52 OIG found that several States did not comply with
Federal waiver and State requirements for reporting and monitoring
critical incidents involving individuals receiving HCBS through
waivers. In particular, they reported that:
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\50\ HHS OIG. ``Connecticut did not comply with Federal and
State requirements for critical incidents involving developmentally
disabled Medicaid beneficiaries.'' May 2016. Accessed at https://oig.hhs.gov/oas/reports/region1/11400002.pdf.
\51\ HHS OIG. ``Massachusetts did not comply with Federal and
State requirements for critical incidents involving developmentally
disabled Medicaid beneficiaries.'' July 2016. Accessed at https://oig.hhs.gov/oas/reports/region1/11400008.pdf.
\52\ HHS OIG. ``Maine did not comply with Federal and State
requirements for critical incidents involving Medicaid beneficiaries
with developmental disabilities.'' August 2017. Accessed at https://oig.hhs.gov/oas/reports/region1/11600001.pdf.
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Critical incidents were not reported correctly;
Adequate training to identify appropriate action steps for
reported critical incidents or reports of abuse or neglect was not
provided to State staff;
Appropriate data sets to trend and track critical
incidents were not accessible to State staff; and
Critical incidents were not clearly defined, making it
difficult to identify potential abuse or neglect.
In 2016, we conducted three State audits based at least in part on
concerns regarding health and welfare and media coverage on abuse,
neglect, or exploitation issues.\53\ We found that these three States
had not been meeting their section 1915(c) waiver assurances, similar
to findings reported by the OIG. In two cases, for the incidents of
concern, tracking and trending of critical incidents were not present.
Further, in at least two of the States, staffing at appropriate levels
was identified as an issue.
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\53\ Presentation by CMS for Advancing States: Quality in the
HCBS Waiver--Health and Welfare. See: http://www.nasuad.org/sites/nasuad/files/Final%20Quality%20201.pdf.
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In January 2018, the United States Government Accountability Office
(GAO) released a report on a study of 48 States that covered assisted
living services.\54\ The GAO found large
[[Page 27979]]
inconsistencies between States in their definition of a critical
incident and their system's ability to report, track, and collect
information on critical incidents that have occurred. States also
varied in their oversight methods as well as the type of information
they were reviewing as part of this oversight. The GAO recommended that
requiring States to report information on incidents (such as the type
and severity of incidents and the number of incidents) would strengthen
the effectiveness of State and Federal oversight.
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\54\ Government Accountability Office. ``Medicaid assisted
living services--improved Federal oversight of beneficiary health
and welfare is needed.'' January 2018. Accessed at https://www.gao.gov/assets/690/689302.pdf.
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In July 2019, we issued a survey to States that operate section
1915(c) waivers, requesting information on their approach to
administering incident management systems. The goal of the survey was
to obtain a comprehensive understanding of how States organize their
incident management system to best respond to, resolve, monitor, and
prevent critical incidents in their waiver programs. The survey found
that:
Definitions of critical incidents vary across States and,
in some cases, within States for different HCBS programs or
populations;
Some States do not use standardized forms for reporting
incidents, thereby impeding the consistent collection of information on
critical incidents;
Some States do not have electronic incident management
systems, and, among those that do, many use systems with outdated
electronic platforms that are not linked with other State systems,
leading to the systems operating in silos and the need to consolidate
information across disparate systems; and
Many States cited the lack of communication within and
across State agencies, including with investigative agencies, as a
barrier to incident resolution.
Additionally, during various public engagement activities conducted
with interested parties over the past several years, we have heard that
ensuring access to HCBS requires that we must first ensure health and
safety systems are in place across all States, a theme underscored by
the Joint Report.
Based on these findings and reports, under the authorities at
sections 1902(a)(19) and 1915(c)(2)(A) of the Act and section
2402(a)(3)(B)(ii) of the Affordable Care Act, we propose a new
requirement at Sec. 441.302(a)(6) to require that States provide an
assurance that they operate and maintain an incident management system
that identifies, reports, triages, investigates, resolves, tracks, and
trends critical incidents. This proposal is intended to ensure
standardized requirements for States regarding incidents that harm or
place a beneficiary at risk of harm and is based on our experience
working with States as part of the section 1915(c) waiver program and
informed by the incident management survey described previously in this
section of the proposed rule. In the absence of an incident management
system, people receiving section 1915(c) waiver program services are at
risk of preventable or intentional harm. As such, we believe that such
a system to identify and address incidents of abuse, neglect,
exploitation, or other harm during the course of service delivery is in
the best interest of and necessary for protecting the health and
welfare of individuals receiving section 1915(c) waiver program
services.
At Sec. 441.302(a)(6)(i)(A) through (G), we propose new
requirements for States' incident management systems. Specifically, at
Sec. 441.302(a)(6)(i)(A), we propose to establish a minimum standard
definition of a critical incident to include, at a minimum, verbal,
physical, sexual, psychological, or emotional abuse; neglect;
exploitation including financial exploitation; misuse or unauthorized
use of restrictive interventions or seclusion; a medication error
resulting in a telephone call to or a consultation with a poison
control center, an emergency department visit, an urgent care visit, a
hospitalization, or death; or an unexplained or unanticipated death,
including but not limited to a death caused by abuse or neglect.
Currently, there is no standardized Federal definition for the type of
events or instances that States should consider a critical incident
that must be reported by a provider to the State and considered for an
investigation by the State to assess whether the incident was the
result of abuse, neglect, or exploitation, and whether it could have
been prevented. The proposed definition at Sec. 441.302(a)(6)(i)(A) is
based on internal analyses of data and information obtained through a
CMS survey of States' incident management systems, commonalities across
definitions, and common gaps in States' definitions of critical
incidents (for instance, that many States do not consider sexual
assault to be a critical incident). We request comment on whether there
are specific types of events or instances of serious harm to section
1915(c) waiver participants, such as identity theft or fraud, that
would not be captured by the proposed definition and that should be
included, and whether the inclusion of any specific types of events or
instances of harm in the proposed definition would lead to the
overidentification of critical incidents.
At Sec. 441.302(a)(6)(i)(B), we propose to require that States
have electronic critical incident systems that, at a minimum, enable
electronic collection, tracking (including of the status and resolution
of investigations), and trending of data on critical incidents. We
request comment on the burden associated with requiring States to have
electronic critical incident systems and whether there is specific
functionality, such as unique identifiers, that should be required or
encouraged for such systems. Although we are not proposing to require
States to do so, States are also encouraged to advance the
interoperable exchange of HCBS data and support quality improvement
activities by adopting standards in 45 CFR, part 170 and other relevant
standards identified in the Interoperability Standards Advisory
(ISA).\55\ We also remind States that enhanced FFP is available at a 90
percent FMAP for the design, development, or installation of
improvements of mechanized claims processing and information retrieval
systems, in accordance with applicable Federal requirements.\56\
Enhanced FFP at a 75 percent FMAP is also available for operations of
such systems, in accordance with applicable Federal requirements.\57\
However, we note that receipt of these enhanced funds is conditioned
upon States meeting a series of standards and conditions to ensure
investments are efficient and effective.\58\
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\55\ Relevant standards adopted by HHS and identified in the ISA
include the USCDI (https://www.healthit.gov/isa/united-states-core-data-interoperability-uscdi), eLTSS (https://www.healthit.gov/isa/documenting-care-plans-person-centered-services), and Functional
Assessment Standardized Items (https://www.healthit.gov/isa/representing-patient-functional-status-andor-disability).
\56\ See section 1903(a)(3)(A)(i) and Sec. 433.15(b)(3), 80 FR
75817-75843; https://www.medicaid.gov/state-resourcecenter/faq-medicaid-and-chip-affordable-care-act-implementation/downloads/affordable-care-act-faq-enhancedfunding-for-medicaid.pdf; https://www.medicaid.gov/federal-policy-guidance/downloads/SMD16004.pdf.
\57\ See section 1903(a)(3)(B) and Sec. 433.15(b)(4).
\58\ See Sec. 433.112 (b, 80 FR 75841; https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-C/part-433/subpart-C.
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At Sec. 441.302(a)(6)(i)(C), we propose to require States to
require providers to report to States any critical incidents that occur
during the delivery of section 1915(c) waiver program services as
specified in a waiver participant's person-centered service plan, or
any critical incidents that are a result of the
[[Page 27980]]
failure to deliver authorized services. Based on the findings of the
Joint Report, as well as the OIG and GAO reports cited earlier,
settings in which residential habilitation and day habilitation
services are provided, and services provided in a beneficiary's private
home by a provider should be of particular focus. We believe that such
a requirement will help to specify provider expectations for reporting
critical incidents and to ensure that harm that occurs because of the
failure to deliver services will be appropriately identified as a
critical incident.
At Sec. 441.302(a)(6)(i)(D), we propose to require that States use
claims data, Medicaid Fraud Control Unit data, and data from other
State agencies such as Adult Protective Services or Child Protective
Services to the extent permissible under applicable State law to
identify critical incidents that are unreported by providers and occur
during the delivery of section 1915(c) waiver program services, or as a
result of the failure to deliver authorized services. We believe that
such data can play an important role in identifying serious instances
of harm to waiver program participants, which may be unreported by a
provider, such as a death that occurs as a result of choking of an
individual with a developmental disability residing in a group home, or
a burn that occurs because a provider failed to appropriately supervise
someone with dementia and that results in an emergency department
visit. We request comment on whether States should be required to use
these data sources to identify unreported critical instances, and
whether there are other specific data sources that States should be
required to use to identify unreported critical incidents.
At Sec. 441.302(a)(6)(i)(E), we propose to require that States
share information, consistent with the regulations in 42 CFR part 431,
subpart F, on the status and resolution of investigations. We expect
this data sharing could be accomplished through the use of information
sharing agreements, with other entities in the State responsible for
investigating critical incidents, if the State refers critical
incidents to other entities for investigation. We also propose, at
Sec. 441.302(a)(6)(i)(F), to require States to separately investigate
critical incidents if the investigative agency fails to report the
resolution of an investigation within State-specified timeframes. These
proposed requirements are intended to ensure that the failure to
effectively share information between State agencies or other entities
in the State responsible for investigating incidents does not impede a
State's ability to effectively identify, report, triage, investigate,
resolve, track, and trend critical incidents, particularly where there
could be evidence of serious harm or a pattern of harm to a section
1915(c) waiver program participant for which a provider is responsible.
As noted in section II.B.1. of this proposed rule, in 2014, we
released guidance for section 1915(c) waiver programs in which we
indicated that States should report on State-developed performance
measures across several domains, including to demonstrate that the
State designed and implemented an effective system for assuring waiver
participant health and welfare. Specifically, the 2014 guidance noted
that States should demonstrate: on an ongoing basis that they identify,
address, and seek to prevent instances of abuse, neglect, exploitation,
and unexplained death; that an incident management system is in place
that effectively resolves those incidents and prevents further similar
incidents to the extent possible; State policies and procedures for the
use or prohibition of restrictive interventions (including restraints
and seclusion) are followed; and overall health care standards are
established and monitored. The 2014 guidance also indicated that States
should conduct systemic remediation and implement a Quality Improvement
Project when they score below 86 percent on any of their performance
measures.
Section 1902(a)(6) of the Act requires State Medicaid agencies to
make such reports, in such form and containing such information, as the
Secretary may from time to time require, and to comply with such
provisions as the Secretary may from time to time find necessary to
assure the correctness and verification of such reports. Under our
authority at section 1902(a)(6) of the Act, we propose to modernize the
health and welfare reporting by requiring all States to report on the
same Federally prescribed quality measures as opposed to the State-
developed measures, which naturally vary State by State. Specifically,
at new Sec. 441.302(a)(6)(i)(G), we propose to require that States
meet the reporting requirements at Sec. 441.311(b)(1) related to the
performance of their incident management systems. We discuss these
reporting requirements in our discussion of proposed Sec.
441.311(b)(1). Further, under our authority at sections 1915(c)(2)(A)
and 1902(a)(19) of the Act, we propose to codify a minimum performance
level to demonstrate that States meet the requirements at Sec.
441.302(a)(6). Specifically, at new Sec. 441.302(a)(6)(ii)(A) through
(C), we propose to require that States demonstrate that an
investigation was initiated, within State-specified timeframes, for no
less than 90 percent of critical incidents; an investigation was
completed and the resolution of the investigation was determined,
within State-specified timeframes, for no less than 90 percent of
critical incidents; and corrective action was completed, within State-
specified timeframes, for no less than 90 percent of critical incidents
that require corrective action.
While we expect States to meet State-specified timeframes for
initiating investigations, completing investigations and determining
resolution, and completing corrective action plans for all critical
incidents, we are proposing to establish a minimum 90 percent
performance level in each of these areas in recognition of the various
scenarios that may impact a State's ability to meet these timeframes
for each critical incident (for example, some critical incidents may
require more complex investigations than others, an illness may delay
the interview of an important witness to the incident).
We considered whether to codify the minimum 86 percent performance
level that was established in the 2014 guidance, instead of the minimum
90 percent performance level we have proposed. The minimum 86 percent
performance level was intended to provide States with a reasonable
threshold for demonstrating compliance with the requirements at Sec.
441.302(a)(6). However, we have conducted extensive oversight and
received significant feedback from external parties since we released
the 2014 guidance. Our findings from the oversight and feedback have
led us to conclude that the minimum 86 percent performance level may
not be sufficient to demonstrate a State is meeting these requirements
because it provides States with more latitude than is necessary to
account for unexpected delays in the timeframes for investigating and
addressing critical incidents. Further, findings from our 2016 audits
and 2019 survey, feedback from States, OIG, ACL, OCR, and other
interested parties, and media and anecdotal reports document the harm
that beneficiaries can experience when States fail to investigate and
address critical incidents and indicate that we should establish a more
stringent threshold for States to demonstrate compliance with the
requirements at Sec. 441.302(a)(6). As a result, we are proposing an
increase to the minimum performance level in the 2014 guidance. This
proposed minimum performance level is intended to
[[Page 27981]]
strengthen health and welfare reporting requirements based on feedback
and evidence we have received, while also recognizing that there may be
legitimate reasons for delays in investigating and addressing critical
incidents.
We also considered whether to propose allowing good cause
exceptions to the minimum performance level in the event of a natural
disaster, public health emergency, or other event that would negatively
impact a State's ability to achieve a minimum 90 percent performance
level. In the end, we are not proposing good cause exceptions because
the minimum 90 percent performance level is intended to account for
various scenarios that might impact a State's ability to achieve these
performance levels. Further, as noted earlier with the person-centered
service plan requirements in section II.B.1. of this preamble, there
are existing disaster authorities that States could utilize to request
a waiver of these requirements in the event of a public health
emergency or a disaster.
At Sec. 441.302(a)(6)(iii), we propose to apply these requirements
to services delivered under FFS or managed care delivery systems. As
discussed earlier in section II.B.1. of this preamble, section
2402(a)(3)(A) of the Affordable Care Act requires States to improve
coordination among, and the regulation of, all providers of Federally
and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In the
context of Medicaid coverage of HCBS, it should not matter whether the
services are covered directly on a FFS basis or by a managed care
entity to its enrollees. The requirement for ``consistent
administration'' should require consistency between these two modes of
service delivery. We accordingly are proposing to identify that a State
must ensure compliance with the requirements in Sec. 441.302(a)(6)
with respect to HCBS delivered both under FFS and managed care delivery
systems.
As noted throughout the HCBS proposals in this rule, we recognize
that many States may need time to implement these requirements,
including to amend provider agreements or managed care contracts, make
State regulatory or policy changes, implement process or procedural
changes, update information systems for data collection and reporting,
or conduct other activities to implement these requirements. As a
result, we are proposing at Sec. 441.302(a)(6)(iii) to provide States
with 3 years to implement these requirements in FFS delivery systems
following effective date of the final rule. For States with managed
care delivery systems under the authority of sections 1915(a), 1915(b),
1932(a), or 1115(a) of the Act and that include HCBS in the MCO's,
PIHP's, or PAHP's contract, we are proposing to provide States until
the first managed care plan contract rating period that begins on or
after 3 years after the effective date of the final rule to implement
these requirements. This time period is based on feedback from States
and other interested parties that it could take 2 to 3 years to amend
State regulations and work with their State legislatures, if needed, as
well as to revise policies, operational processes, information systems,
and contracts to support implementation of the proposals outlined in
this section. We also considered all of the HCBS proposals outlined in
proposed rule as whole. We invite comments on whether this timeframe is
sufficient, whether we should require a shorter timeframe (2 years) or
longer timeframe (4 years) to implement these provisions, and if an
alternate timeframe is recommended, the rationale for that alternate
timeframe.
Again, the proposed requirements at Sec. Sec. 441.302(a)(6)(iii)
and 441.311(b)(1), in combination with other proposed requirements
identified throughout this proposed rule, are intended to supersede and
fully replace the reporting expectations and the minimum 86 percent
performance level for State's performance measures described in the
2014 guidance. We expect that States may implement some of the
requirements proposed in this proposed rule in advance of the effective
date. To reduce unnecessary burden and to avoid duplicative or
conflicting reporting requirements, we will work with States to phase-
out the 2014 guidance as they implement these proposed requirements
should a final rule be adopted.
Additionally, as discussed earlier in section II.B.1. of this
preamble, section 2402(a)(3)(A) of the Affordable Care Act requires
States to improve coordination among, and the regulation of, all
providers of Federally and State-funded HCBS programs to achieve a more
consistent administration of policies and procedures across HCBS
programs. In accordance with the requirement of section 2402(a)(3)(A)
of the Affordable Care Act for States to achieve a more consistent
administration of policies and procedures across HCBS programs and
because of the importance of assuring health and welfare for other HCBS
State plan options, we are proposing to incorporate these incident
management requirements within the applicable regulatory sections.
Specifically, we propose to apply the proposed requirements Sec.
441.302(a)(6) to section 1915(j), (k), and (i) State plan services by
cross-referencing at Sec. Sec. 441.570(e), 441.464(e), and
441.745(a)(1)(v), respectively. Consistent with our proposal for
section 1915(c) waivers, we propose these requirements based on our
authority under section 1902(a)(19) of the Act to assure that there are
safeguards for beneficiaries. We believe the same arguments for
proposing these requirements for section 1915(c) waivers are equally
applicable for these other HCBS authorities. We request comment on the
application of these provisions across section 1915(i), (j), and (k)
authorities. To accommodate the addition of new language at Sec.
441.464(e) and (f) (discussed later in section II.B.5. of this proposed
rule), we are proposing to renumber existing Sec. 441.464(e) as Sec.
441.464(g) and existing Sec. 441.464(f) as Sec. 441.464(h).
Finally, we considered whether to also apply the proposed incident
management system and critical incident reporting and performance
threshold requirements to section 1905(a) ``medical assistance'' State
plan personal care, home health, and case management services. However,
we are not proposing that these requirements apply to any section
1905(a) State plan services based on State feedback that they do not
have the same data collection and reporting capabilities in place for
section 1905(a) services as they do for section 1915(c), (i), (j), and
(k) services. Further, the vast majority of HCBS is delivered under
section 1915(c), (i), (j), and (k) authorities, while only a small
percentage of HCBS nationally is delivered under section 1905(a) State
plan authorities. We request comment on whether we should establish
similar health and welfare requirements for section 1905(a) State plan
personal care, home health, and case management services.
4. Reporting (Sec. 441.302(h))
Proposed Sec. 441.311, described in section II.B.7. of this
proposed rule, establishes a new Reporting Requirements section. As
discussed earlier in section II.B.1. of this preamble, section
2402(a)(3)(A) of the Affordable Care Act requires HHS to promulgate
regulations to ensure that States develop HCBS systems that are
designed to improve coordination among, and the regulation of, all
providers of Federally and State-funded HCBS programs to achieve a more
consistent administration of policies and procedures across HCBS
programs.
[[Page 27982]]
In addition to supporting States with achieving a more consistent
administration of policies and procedures across HCBS programs in
accordance with the requirement of section 2402(a)(3)(A) of the
Affordable Care Act, we believe that standardizing reporting across
HCBS authorities will streamline and simplify reporting for providers,
improve States' and CMS's ability to assess HCBS quality and
performance, and better enable States to improve the quality of HCBS
programs through the availability of comparative data. Further, section
1902(a)(6) of the Act requires State Medicaid agencies to make such
reports, in such form and containing such information, as the Secretary
may from time to time require, and to comply with such provisions as
the Secretary may from time to time find necessary to assure the
correctness and verification of such reports.
To avoid duplicative or conflicting reporting requirements at Sec.
441.302(h), we propose to amend Sec. 441.302(h) by removing the
following language: ``annually''; ``The information must be consistent
with a data collection plan designed by CMS and must address the
waiver's impact on -''; and by removing paragraphs (1) and (2) under
Sec. 441.302(h). Further, we propose to add ``, including the data and
information as required in Sec. 441.311'' at the end of the new
amended text, ``Assurance that the agency will provide CMS with
information on the waiver's impact.'' By making these changes, we are
consolidating reporting expectations in one new section at proposed
Sec. 441.311, described in section II.B.7. of this proposed rule,
under our authority at section 1902(a)(6) of the Act and section
2402(a)(3)(A) of the Affordable Care Act. As noted earlier in section
II.B.1. of this proposed rule, this reporting will supersede existing
reporting for section 1915(c) waivers and standardize reporting across
section 1915 HCBS authorities.
5. HCBS Payment Adequacy (Sec. Sec. 441.302(k), 441.464(f),
441.570(f), 441.745(a)(1)(vi))
Section 1902(a)(30)(A) of the Act requires State Medicaid programs
to ensure that payments to providers are consistent with efficiency,
economy, and quality of care and are sufficient to enlist enough
providers so that care and services are available to beneficiaries at
least to the extent as to the general population in the same geographic
area. Access to most HCBS generally requires hands-on and in-person
services to be delivered by direct care workers. Direct care workers
are referred to by various names, such as direct support professionals,
personal care attendants, and home health aides, within and across
States. They perform a variety of roles, including nursing services,
assistance with activities of daily living (such as mobility, personal
hygiene, eating) and instrumental activities of daily living (such as
cooking, grocery shopping, managing finances), behavioral supports,
employment supports, and other services to promote community
integration for older adults and people with disabilities. We discuss
the definition of direct care workers in more detail below in the
context of our proposed definition of direct care workers.
Direct care workers typically earn low wages and receive limited
benefits,59 60 61 contributing to a shortage of direct care
workers and high rates of turnover in this workforce, which can limit
access to and impact the quality of HCBS. Workforce shortages can also
reduce the cost-effectiveness of services for State Medicaid agencies
that take into account the actual cost of delivering services when
determining Medicaid payment rates, such as by increasing the reliance
on overtime and temporary staff, which have higher hourly costs than
non-overtime wages paid to permanent staff. Further, an insufficient
supply of HCBS providers can prevent individuals from transitioning
from institutions to home and community-based settings and from
receiving HCBS that can prevent institutionalization. HCBS is, on
average, less costly than institutional services,62 63 and
most older adults and people with disabilities strongly prefer to live
in the community. Accordingly, limits on the availability of HCBS
lessen the ability for State Medicaid programs to deliver LTSS in a
cost-effective, beneficiary friendly manner.
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\59\ MACPAC Issue Brief. State Efforts to Address Medicaid Home-
and Community-Based Services Workforce Shortages. March 2022.
Accessed at https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
\60\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\61\ We recognize that there are workforce shortages that may
impact access to other Medicaid-covered services aside from HCBS. We
are focusing in this proposed rule on addressing workforce shortages
in HCBS and continue to assess the feasibility and potential impact
of other actions to address workforce shortages in other parts of
the health care sector.
\62\ Reaves, E.L., & Musumeci, M.B. December 15, 2015. Medicaid
and Long-Term Services and Supports: A Primer. Kaiser Family
Foundation. Accessed at https://www.kff.org/medicaid/report/medicaid-and-long-term-services-and-supports-a-primer/.
\63\ Kim, M-Y, Weizenegger, E., & Wysocki, A. July 22, 2022.
Medicaid Beneficiaries Who Use Long-Term Services and Supports:
2019. Chicago, IL: Mathematica. Accessed at https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-user-brief-2019.pdf.
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Shortages of direct care workers and high rates of turnover also
reduce the quality of HCBS. For instance, workforce shortages can
prevent individuals from receiving needed services and, in turn, lead
to poorer outcomes for people who need HCBS. Insufficient staffing can
also make it difficult for providers to achieve quality standards.\64\
High rates of turnover can reduce quality of care,\65\ including
through the loss of experienced and qualified workers and by reducing
continuity of care people receiving HCBS,\66\ which is associated with
the reduced likelihood of improvement in function among people
receiving home health aide services.\67\
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\64\ American Network of Community Options and Resources
(ANCOR). 2021. The state of America's direct support workforce 2021.
Alexandria, VA: ANCOR. Accessed at https://www.ancor.org/sites/default/files/the_state_of_americas_direct_support_workforce_crisis_2021.pdf.
\65\ Newcomer R, Kang T, Faucett J. Consumer-directed personal
care: comparing aged and non-aged adult recipient health-related
outcomes among those with paid family versus non-relative providers.
Home Health Care Serv Q. 2011;30(4):178-97.
\66\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\67\ Russell D, Rosati RJ, Peng TR, Barr[oacute]n Y,
Andreopoulos E . Continuity in the provider of home health aide
services and the likelihood of patient improvement in activities of
daily living. Home Health Care Manage Pract. 2013;25(1):6-12.
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While workforce shortages have existed for years, the COVID-19
pandemic has exacerbated the problem, leading to higher rates of direct
care worker turnover (for instance, due to higher rates of worker-
reported stress), an inability of some direct care workers to return to
their positions prior to the pandemic (for instance, due to difficulty
accessing child care or concerns about contracting COVID-19 for people
with higher risk of severe illness), workforce shortages across the
health care sector, and wage increases in retail and other jobs that
tend to draw from the same pool of workers as some
HCBS.68 69 70
[[Page 27983]]
Further, demand for direct care workers is expected to continue rising
due to the growing needs of the aging population, the changing ability
of aging caregivers to provide supports, a broader societal shift away
from institutional services and towards services that are integrated in
the community, and a decline in the number of younger workers available
to provide services.71 72 73 As discussed previously in
section II.B.1. of this proposed rule, section 2402(a) of the
Affordable Care Act requires the Secretary of HHS to ensure that all
States receiving Federal funds for HCBS, including Medicaid, develop
HCBS systems that are responsive to the needs and choices of
beneficiaries receiving HCBS, maximize independence and self-direction,
provide coordination for and support each person's full engagement in
community life, and achieve a more consistent and coordinated approach
to the administration of policies and procedures across public programs
providing HCBS.\74\ In particular, section 2402(a)(1) of the Affordable
Care Act requires States to allocate resources for services in a manner
that is responsive to the changing needs and choices of beneficiaries
receiving HCBS, while section 2402(a)(3)(B)(iii) of the Affordable Care
Act requires States to oversee and monitor HCBS system functions to
assure a sufficient number of qualified direct care workers to provide
self-directed personal assistance services. To comply with sections
2402(a)(1) and 2402(a)(3)(B)(iii) of the Affordable Care Act, States
must have a sufficient direct care workforce to be able to deliver
services that are responsive to the changing needs and choices of
beneficiaries, and, specifically, a sufficient number of qualified
direct care workers to provide self-directed personal assistance
services.
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\68\ MACPAC Issue Brief. State Efforts to Address Medicaid Home-
and Community-Based Services Workforce Shortages. March 2022.
Accessed at https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
\69\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\70\ American Network of Community Options and Resources
(ANCOR). 2021. The state of America's direct support workforce 2021.
Alexandria, VA: ANCOR. Accessed at https://www.ancor.org/sites/default/files/the_state_of_americas_direct_support_workforce_crisis_2021.pdf.
\71\ MACPAC Issue Brief. State Efforts to Address Medicaid Home-
and Community-Based Services Workforce Shortages. March 2022.
Accessed at https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
\72\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\73\ Centers for Medicare and Medicaid Services. November 2020.
Long-Term Services and Supports Rebalancing Toolkit. Accessed at
https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-rebalancing-toolkit.pdf.
\74\ Section 2402(a) of the Affordable Care Act--Guidance for
Implementing Standards for Person-Centered Planning and Self-
Direction in Home and Community-Based Services Programs. Accessed at
https://acl.gov/sites/default/files/news%202016-10/2402-a-Guidance.pdf.
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Consistent with section 1902(a)(30)(A) of the Act and sections
2402(a)(1) and 2402(a)(3)(B)(iii) of the Affordable Care Act, we
propose to require that State Medicaid agencies demonstrate that
payment rates for certain HCBS authorized under section 1915(c) of the
Act are sufficient to ensure a sufficient direct care workforce
(defined and explained later in this section of the proposed rule) to
meet the needs of beneficiaries and provide access to services in
accordance with the amount, duration, and scope specified in the
person-centered service plan, as required under Sec. 441.301(c)(2). We
believe that this proposal supports the economy, efficiency, and
quality of HCBS authorized under section 1915(c) of the Act, by
ensuring that a sufficient portion of State FFS and managed care
payments for HCBS go directly to compensation of the direct care
workforce. While many States have already voluntarily established such
minimums for payments authorized under section 1915(c) of the Act,\75\
we believe a Federal standard would support ongoing access to, and
quality and efficiency of, HCBS.
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\75\ For instance, as part of their required activities to
enhance, expand, or strengthen HCBS under ARP section 9817, some
States have required that a minimum percentage of rate increases and
supplemental payments go to the direct care workforce. See https://www.medicaid.gov/medicaid/home-community-based-services/guidance/strengthening-and-investing-home-and-community-based-services-for-medicaid-beneficiaries-american-rescue-plan-act-of-2021-section-9817/index.html for more information on ARP section 9817.
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This proposal is designed to affect the inextricable link between
sufficient payments being received by the direct care workforce and
access to and, ultimately, the quality of HCBS received by Medicaid
beneficiaries. We believe that this proposal would not only benefit
direct care workers but also individuals receiving Medicaid HCBS
because supporting and stabilizing the direct care workforce will
result in better qualified employees, lower turnover, and a higher
quality of care. The direct care workforce must be able to attract and
retain qualified workers in order for beneficiaries to access providers
of the services they have been assessed to need and for the direct care
workforce to be comprised of workers with the training, expertise, and
experience to meet the diverse and often complex HCBS needs of
individuals with disabilities and older adults. Without access to a
sufficient pool of direct care providers, individuals are forced to
forgo having their needs met or addressed by workers without sufficient
training, expertise, or experience to meet their unique needs, both of
which could lead to worsening health and quality of life outcomes, loss
of independence, and institutionalization.76 77 78 79
Further, we believe that ensuring adherence to a Federal standard of
the percentage of Medicaid payments going to direct care workers is a
concrete step in recruitment and retention efforts to stabilize this
workforce by enhancing salary competitiveness in the labor market. In
the absence of such requirements, we are unable to support and
stabilize the direct care workforce because we are unable to ensure
that the payments are used primarily and substantially to pay for care
and services provided by direct care workers. Therefore, at Sec.
441.302(k)(3)(i), we propose to require that at least 80 percent of all
Medicaid payments, including but not limited to base payments and
supplemental payments, with respect to the following services be spent
on compensation to direct care workers: homemaker services, home health
aide services, and personal care services.\80\
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\76\ MACPAC Issue Brief. State Efforts to Address Medicaid Home-
and Community-Based Services Workforce Shortages. March 2022.
Accessed at https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
\77\ Campbell, S., A. Del Rio Drake, R. Espinoza, K. Scales.
2021. Caring for the future: The power and potential of America's
direct care workforce. Bronx, NY: PHI http://phinational.org/wp-content/uploads/2021/01/Caring-for-the-Future-2021-PHI.pdf.
\78\ American Network of Community Options and Resources
(ANCOR). 2021. The state of America's direct support workforce 2021.
Alexandria, VA: ANCOR. Accessed at https://www.ancor.org/sites/default/files/the_state_of_americas_direct_support_workforce_crisis_2021.pdf.
\79\ Chong, N., I. Akorbirshoev, J. Caldwell, H.S. Kaye, and M.
Mitra. 2021. The relationship between unmet need for home and
community-based services and health and community living outcomes.
Disability Health Journal. Accessed at https://www.sciencedirect.com/science/article/abs/pii/S1936657421001953.
\80\ We note that section 2402(a) of the Affordable Care Act
applies broadly to all HCBS programs and services funded by HHS.
Further, section 2402(a) does not include limits on the scope of
services, HCBS authorities, or other factors related to its use of
the term HCBS. Therefore, we believe that there is no indication
that personal care, homemaker, and home health aide services would
fall outside the scope of section 2402(a).
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This proposal is based on feedback from States that have
implemented similar requirements for payments for certain HCBS under
section 9817 of the ARP \81\ or other State-led initiatives.
[[Page 27984]]
These States have reported to us through various public engagement
activities that similar requirements have had their intended effect of
ensuring that a sufficient portion of the payment for Medicaid HCBS
goes to compensation for the direct care workforce. These States have
also indicated an 80 percent threshold is an appropriate threshold that
takes into account the expected portion of payments that are necessary
for provider administrative and other costs, aside from direct care
worker compensation, although our research indicates that some States
have successfully implemented other thresholds, ranging from a low of
around 75 percent \82\ to a high of 90 percent. We have also focused
this requirement on homemaker services, home health aide services, and
personal care services because they are services for which we expect
that the vast majority of payment should be comprised of compensation
for direct care workers. These are services that would most commonly be
conducted in individuals' homes and general community settings. As
such, there should be low facility or other indirect costs associated
with the services. We request comment on the following options for the
minimum percentage of payments that must be spent on compensation to
direct care workers for homemaker services, home health aide services,
and personal care services: (1) 75 percent; (2) 85 percent; and (3) 90
percent. If an alternate minimum percentage is recommended, we request
that commenters provide the rationale for that minimum percentage.
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\81\ Information on State activities to expand, enhance, or
strengthen HCBS under ARP section 9817 can be found on Medicaid.gov
at https://www.medicaid.gov/medicaid/home-community-based-services/guidance/strengthening-and-investing-home-and-community-based-services-for-medicaid-beneficiaries-american-rescue-plan-act-of-2021-section-9817/index.html.
\82\ Minnesota has established a minimum threshold of 72.5
percent, while Illinois has implemented a minimum threshold of 77
percent, for similar requirements for HCBS as we are proposing. See
https://www.revisor.mn.gov/statutes/cite/256B.85/pdf and https://casetext.com/regulation/illinois-administrative-code/title-89-social-services/part-240-community-care-program/subpart-t-financial-reporting/section-2402040-minimum-direct-service-worker-costs-for-in-home-service, respectively, for more information.
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We considered whether the proposed requirements at Sec.
441.302(k)(3)(i) related to the percent of payments going to the direct
care workforce should apply to other services, such as adult day
health, habilitation, day treatment or other partial hospitalization
services, psychosocial rehabilitation services, and clinic services for
individuals with chronic mental illness. However, these services may
have facility or other indirect costs for which we do not have adequate
information to determine a minimum percent of the payment that should
be spent on compensation for the direct care workforce. We request
comment on whether the proposed requirements at Sec. 441.302(k)(3)(i)
related to the percent of payments going to the direct care workforce
should apply to other services listed at Sec. 440.180(b). In
particular, in recognition of the importance of services provided to
individuals with intellectual or developmental disabilities, we request
comment on whether the proposed requirements at Sec. 441.302(k)(3)(i)
related to the percent of payments going to the direct care workforce
should apply to residential habilitation services, day habilitation
services, and home-based habilitation services.
We also request comment on the following options for the minimum
percentage of payments that must be spent on compensation to direct
care workers for each specific service that this provision should apply
if this provision should apply to other services at Sec. 440.180(b):
(1) 65 percent; (2) 70 percent; (3) 75 percent; and (4) 80 percent.
Specifically, we request that commenters respond separately on the
minimum percentage of payments for services delivered in a non-
residential community-based facility, day center, senior center, or
other dedicated physical space, which would be expected to have higher
other indirect costs and facility costs built into the Medicaid payment
rate than other HCBS. If an alternate minimum percentage is
recommended, we request that commenters provide the rationale for that
minimum percentage.
We further clarify that we are requesting comment on a different
range of options for the other services at Sec. 440.180(b) than for
the services at Sec. 440.180(b)(2) through (4) because we expect that
some of the other services at Sec. 440.180(b), such as adult day
health and day habilitation services, may have higher other indirect
costs and facility costs than the services at Sec. 440.180(b)(2)
through (4). We also request that commenters respond separately on the
minimum percentage of payments for facility-based residential services
and other facility-based round-the-clock services that have other
indirect costs and facility costs that would be paid for at least in
part by room and board payments that Medicaid does not cover. If a
minimum percentage is recommended for any services, we request that
commenters provide the rationale for that minimum percentage.
At Sec. 441.302(k)(1)(i), we propose to define compensation to
include salary, wages, and other remuneration as defined by the Fair
Labor Standards Act and implementing regulations (29 U.S.C. 201 et
seq., 29 CFR parts 531 and 778), and benefits (such as health and
dental benefits, sick leave, and tuition reimbursement). In addition,
we propose to define compensation to include the employer share of
payroll taxes for direct care workers delivering services under section
1915(c) waivers. We considered whether to include training or other
costs in our proposed definition of compensation. However, we
determined that a definition that more directly assesses the financial
benefits to workers would better ensure that a sufficient portion of
the payment for services went to direct care workers, as it is unclear
that the cost of training and other workforce activities is an
appropriate way to quantify the benefit of those activities for
workers. We request comment on whether the definition of compensation
should include other specific financial and non-financial forms of
compensation for direct care workers.
At Sec. 441.302(k)(1)(ii), we propose to define direct care
workers to include workers who provide nursing services, assist with
activities of daily living (such as mobility, personal hygiene, eating)
or instrumental activities of daily living (such as cooking, grocery
shopping, managing finances), and provide behavioral supports,
employment supports, or other services to promote community
integration. Specifically, we propose to define direct care workers to
include nurses (registered nurses, licensed practical nurses, nurse
practitioners, or clinical nurse specialists) who provide nursing
services to Medicaid-eligible individuals receiving HCBS, licensed or
certified nursing assistants, direct support professionals, personal
care attendants, home health aides, and other individuals who are paid
to directly provide services to Medicaid beneficiaries receiving HCBS
to address activities of daily living or instrumental activities of
daily living, behavioral supports, employment supports, or other
services to promote community integration. We further identify that our
definition of direct care worker is intended to exclude nurses in
supervisory or administrative roles who are not directly providing
nursing services to people receiving HCBS.
Our definition of direct care worker is intended to broadly define
such workers to ensure that the definition appropriately captures the
diversity of roles and titles that direct care workers may have. We
included workers with professional degrees, such as nurses, in our
proposed definition because of the
[[Page 27985]]
important roles that direct care workers with professional degrees play
in the care and services of people receiving HCBS, and because
excluding workers with professional degrees may increase the complexity
of reporting, and may unfairly punish States, managed care plans, and
providers that disproportionately rely on workers with professional
degrees in the delivery of HCBS. We also propose to define direct care
workers to include: individuals employed by a Medicaid provider, State
agency, or third party; contracted with a Medicaid provider, State
agency, or third party; or delivering services under a self-directed
service model. This proposed definition is in recognition of the varied
service delivery models and employment relationships that can exist in
HCBS waivers. We request comment on whether there are other specific
types of direct care workers that should be included in the definition,
and whether any of the types of workers listed should be excluded from
the definition of direct care worker.
Section 1902(a)(6) of the Act requires State Medicaid agencies to
make such reports, in such form and containing such information, as the
Secretary may from time to time require, and to comply with such
provisions as the Secretary may from time to time find necessary to
assure the correctness and verification of such reports. At Sec.
441.302(k)(2), under our authority at section 1902(a)(6) of the Act, we
propose to require that States demonstrate that they meet the minimum
performance level at Sec. 441.302(k)(3)(i) through new Federal
reporting requirements at Sec. 441.311(e). We discuss these reporting
requirements in our discussion of proposed Sec. 441.311(e).
At Sec. 441.302(k)(4), we propose to apply these requirements to
services delivered under FFS or managed care delivery systems. As
discussed earlier in section II.B.1. of this preamble, section
2402(a)(3)(A) of the Affordable Care Act requires States to improve
coordination among, and the regulation of, all providers of Federally
and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In the
context of Medicaid coverage of HCBS, it should not matter whether the
services are covered directly on a FFS basis or by a managed care
entity to its enrollees. The requirement for ``consistent
administration'' should require consistency between these two modes of
service delivery. We accordingly are proposing to specify that a State
must ensure compliance with the requirements in Sec. 441.302(k) with
respect to HCBS delivered both under FFS and managed care delivery
systems.
Similarly, because workforce shortages exist under other HCBS
authorities, which include many of the same types of services to
address activities of daily living or instrumental activities of daily
living as under section 1915(c) waiver authority, we are proposing to
incorporate these requirements within the applicable regulatory
sections. Specifically, we propose to apply the proposed requirements
at Sec. 441.302(k) to section 1915(j), (k), and (i) State plan
services by cross-referencing at Sec. Sec. 441.464(f), 441.570(f), and
441.745(a)(1)(vi), respectively. Consistent with our proposal for
section 1915(c) waivers, we propose these requirements based on our
authority under section 1902(a)(30)(A) of the Act to ensure payments to
HCBS providers are consistent with efficiency, economy, and quality of
care and are sufficient to enlist enough providers so that care and
services are available to beneficiaries at least to the extent as to
the general population in the same geographic area. We believe the same
arguments for proposing these requirements for section 1915(c) waivers
are equally applicable for these other HCBS authorities. We request
comment on the application of payment adequacy provisions across
section 1915(i), (j), and (k) authorities. As noted earlier in section
II.B.4. of this proposed rule, to accommodate the addition of new
language at Sec. Sec. 441.464(e) and 441.464(f), we are proposing to
renumber existing Sec. 441.464(e) as Sec. 441.464(g) and existing
Sec. 441.464(f) as Sec. 441.464(h). We request comment on whether we
should exempt, from these requirements, services delivered using any
self-directed service delivery model under any Medicaid authority.
We considered whether to also apply these proposed payment adequacy
requirements to section 1905(a) ``medical assistance'' State plan
personal care and home health services. However, we are not proposing
that these requirements apply to any 1905(a) State plan services based
on State feedback that they do not have the same data collection and
reporting capabilities in place for section 1905(a) services as they do
for section 1915(c), (i), (j), waiver programs and section 1915(i),
(j), and (k) services. Further, the vast majority of HCBS is delivered
under section 1915(c), (i), (j), and (k) authorities, while only a
small percentage of HCBS nationally is delivered under section 1905(a)
State plan authorities. We request comment on whether we should apply
these requirements to section 1905(a) State plan personal care and home
health services.
As noted throughout the HCBS provisions in this preamble, we
recognize that many States may need time to implement these
requirements, including to amend provider agreements or managed care
contracts, make State regulatory or policy changes, implement process
or procedural changes, update information systems for data collection
and reporting, or conduct other activities to implement these proposed
payment adequacy requirements. We expect that these activities will
take longer than similar activities for other HCBS provisions in this
proposed rule. Further, we expect that it will take a substantial
amount of time for managed care plans and providers to establish the
necessary systems, data collection tools, and processes necessary to
collect the required information to report to States. As a result, we
are proposing at Sec. 441.302(k)(4), to provide States with 4 years to
implement these requirements in FFS delivery systems following
effective date of the final rule. For States with managed care delivery
systems under the authority of sections 1915(a), 1915(b), 1932(a), or
1115(a) of the Act and that include HCBS in the MCO's, PIHP's, or
PAHP's contract, we are proposing to provide States until the first
managed care plan contract rating period that begins on or after 4
years after the effective date of the final rule to implement these
requirements. Similar to our rationale in other sections, this proposed
timeline reflects feedback from States and other interested parties
that it could take 3 to 4 years for States to complete any necessary
work to amend State regulations and work with their State legislatures,
if needed, as well as to revise policies, operational processes,
information systems, and contracts to support implementation of the
proposals outlined in this section. We also considered the overall
burden of the proposed rule as whole in proposing the effective date
for the payment adequacy provision. We invite comments on the overall
burden associated with implementing this section, whether this
timeframe is sufficient, whether we should require a shorter timeframe
(such as 3 years) or longer timeframe (such as 5 years) to implement
the payment adequacy provisions and if an alternate timeframe is
recommended, the rationale for that alternate timeframe.
[[Page 27986]]
6. Supporting Documentation Required (Sec. 441.303(f)(6))
As described in section II.B.7 of this proposed rule, discussing
newly proposed reporting requirements, States vary in whether they
maintain waiting lists for section 1915(c) waivers, and if a waiting
list is maintained, how individuals may join the waiting list. Section
1915(c) of the Act authorizes States to set enrollment limits or caps
on the number of individuals served in a waiver, and many States
maintain waiting lists of individuals interested in receiving waiver
services once a spot becomes available. While some States require
individuals to first be determined eligible for waiver services to join
the waiting list, other States permit individuals to join a waiting
list after an expression of interest in receiving waiver services. This
can overestimate the number of people who need Medicaid-covered HCBS
because the waiting lists may include individuals who are not eligible
for services. According to the Kaiser Family Foundation, over half of
people on HCBS waiting lists live in States that do not screen people
on waiting lists for eligibility.\83\
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\83\ Burns, A., M. O'Malley Watts, M. Ammula. A Look at Waiting
lists for Home and Community-Based Services from 2016 to 2021.
Kaiser Family Foundation. https://www.kff.org/47f8e6f/.
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We have not previously required States to submit any information on
the existence or composition of waiting lists, which has led to gaps in
information on the accessibility of HCBS within and across States.
Further, feedback obtained during various public engagement activities
conducted with States and other interested parties over the past
several years about reporting requirements for HCBS, as well as
feedback received through the RFI \84\ discussed earlier, indicate that
there is a need to improve public transparency and processes related to
States' HCBS waiting lists. In addition, we have found, over the past
several years in particular, that some States are operating waiting
lists for their section 1915(c) waiver programs even though they are
serving fewer people than their CMS-approved enrollment limit or cap,
and States are expected to enroll individuals up to their CMS-approved
enrollment limit or cap before imposing a waiting list. However,
because we do not routinely collect information on States' use of
waiting lists and the number of people on waiting lists, we are unable
to determine the extent to which States are operating such
``unauthorized'' waiting lists or to work with States to address these
``unauthorized'' waiting lists.
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\84\ CMS Request for Information: Access to Coverage and Care in
Medicaid & CHIP. February 2022. For a full list of question from the
RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
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Section 1902(a)(6) of the Act requires State Medicaid agencies to
make such reports, in such form and containing such information as the
Secretary may from time to time require, and to comply with such
provisions as the Secretary may from time to time find necessary to
assure the correctness and verification of such reports. Based on the
authority found at section 1902(a)(6) of the Act, we now propose to
require information from States on waiting lists to improve public
transparency and processes related to States' HCBS waiting lists and
ensure that we are able to adequately oversee and monitor States' use
of waiting lists in their section 1915(c) waiver programs. To address
new proposed requirements at Sec. 441.311(d)(1), described in the next
section of the preamble, on State reporting on waiting lists, we
propose to amend Sec. 441.303(f)(6) by adding the following sentence
to the end of the existing regulatory text: If the State has a limit on
the size of the waiver program and maintains a list of individuals who
are waiting to enroll in the waiver program, the State must meet the
reporting requirements at Sec. 441.311(d)(1).''
7. Reporting Requirements (Sec. Sec. 441.311, 441.474(c), 441.580(i),
and 441.745(a)(1)(vii))
Section 1902(a)(6) of the Act requires State Medicaid agencies to
make such reports, in such form and containing such information, as the
Secretary may from time to time require, and to comply with such
provisions as the Secretary may from time to time find necessary to
assure the correctness and verification of such reports. As discussed
in section II.B.1. of this proposed rule, in 2014, we released guidance
for section 1915(c) waiver programs in which we requested States to
report on State-developed performance measures across several domains,
as part of an overarching HCBS waiver quality strategy. The 2014
guidance established an expectation that States conduct systemic
remediation and implement a Quality Improvement Project when they score
below 86 percent on any of their performance measures. Under our
authority at section 1902(a)(6) of the Act, we are proposing
requirements at Sec. 441.311, in combination with other proposed
requirements identified throughout this proposed rule, to supersede and
fully replace the reporting metrics and the minimum 86 percent
performance level expectations for States' performance measures
described in the 2014 guidance. We describe the basis and scope of this
section in paragraph (a).
The reporting requirements proposed in this proposed rule represent
consolidated feedback from States, consumer advocates, managed care
plans, providers, and other HCBS interested parties on improving and
enhancing section 1915(c) waiver performance to integrate nationally
standardized quality measures into the reporting requirements, address
gaps in existing reporting requirements related to access and the
direct service workforce, strengthen health and welfare and person-
centered planning reporting requirements, and eliminate annual
performance measure reporting requirements that provide limited useful
data for assessing State compliance with statutory and regulatory
requirements. We believe that the proposed reporting requirements will
allow us to better assess State compliance with the statutory and
regulatory requirements for section 1915(c) waiver programs. As
indicated at the end of this preamble section, we propose that the
following reporting requirements also apply to State plan options
authorized under section 1915(i), (j) and (k) of the Act, as well as to
both FFS and managed care delivery systems.
a. Compliance Reporting
(1) Incident Management System Assessment
As noted earlier in section II.B.3. of this preamble, there have
been notable and high-profile instances of abuse and neglect in recent
years that highlight the risks associated with poor quality care and
with inadequate oversight of HCBS in Medicaid, despite State efforts to
implement statutory and regulatory requirements to protect the health
and welfare of individuals receiving section 1915(c) waiver program
services, and State adoption of related subregulatory guidance,
requirements, and adopting subregulatory guidance. In addition, a July
2019 survey of States that operate section 1915(c) waivers found that:
Definitions of critical incidents vary across States and,
in some cases, within States for different HCBS programs or
populations;
Some States do not use standardized forms for reporting
incidents, thereby impeding the consistent collection of information on
critical incidents;
Some States do not have electronic incident management
systems, and, among those that do, many use systems
[[Page 27987]]
with outdated electronic platforms that are not linked with other State
systems, leading to the systems operating in silos and the need to
consolidate information across disparate systems; and
Many States cited the lack of communication within and
across State agencies, including with investigative agencies, as a
barrier to incident resolution.
Based on these findings and reports, as well as feedback obtained
during various public engagement activities conducted with interested
parties over the past several years to standardize and strengthen
health and welfare reporting requirements, we are proposing new
requirements for States' incident management systems at Sec.
441.302(a)(6), as discussed in section II.B.3. of this preamble. We
believe that these proposed reporting requirements will allow us to
better assess State compliance with the requirements at Sec.
441.302(a)(6).
Relying on our authority at section 1902(a)(6) of the Act, at Sec.
441.311(b), we propose to establish new compliance reporting
requirements. Specifically, at Sec. 441.311(b)(1)(i), we propose to
require that States report every 24 months on the results of an
incident management system assessment to demonstrate that they meet the
requirements at Sec. 441.302(a)(6) that the State operate and maintain
an incident management system that identifies, reports, triages,
investigates, resolves, tracks, and trends critical incidents,
including that:
The State define critical incidents to meet the proposed
minimum standard definition at Sec. 441.302(a)(6)(i)(A);
The State have an electronic critical incident system
that, at a minimum, enables electronic collection, tracking (including
of the status and resolution of investigations), and trending of data
on critical incidents as proposed at Sec. 441.302(a)(6)(i)(B);
The State require that providers report any critical
incidents that occur during the delivery of section 1915(c) waiver
program services as specified in a waiver participant's person-centered
service plan, or are a result of the failure to deliver authorized
services, as proposed at Sec. 441.302(a)(6)(i)(C);
The State use claims data, Medicaid Fraud Control Unit
data, and data from other State agencies such as Adult Protective
Services or Child Protective Services to the extent permissible under
applicable State law to identify critical incidents that are unreported
by providers and occur during the delivery of section 1915(c) waiver
program services, or as a result of the failure to deliver authorized
services, as proposed at Sec. 441.302(a)(6)(i)(D);
The State share information on reported incidents, the
status and resolution of investigations, such as through the use of
information sharing agreements, with other entities in the State
responsible for investigating critical incidents, if the State refers
critical incidents to other entities for investigation, as proposed at
Sec. 441.302(a)(6)(i)(E); and
The State separately investigate critical incidents if the
investigative agency fails to report the resolution of an investigation
within State-specified timeframes as proposed at Sec.
441.302(a)(6)(i)(F).
Given the risk of preventable and intentional harm to beneficiaries
when effective incident management systems are not in place, documented
instances of abuse and neglect among people receiving HCBS, and
identified shortcomings and weaknesses of States' incident management
systems discussed earlier, we believe the requirement for States to
report every other year on the results of an incident management system
assessment is in the best interest of and necessary for protecting the
health and welfare of individuals receiving section 1915(c) waiver
program services. In the absence of such a reporting requirement, we
are unable to determine whether States have effective systems in place
to identify and address incidents of abuse, neglect, exploitation, or
other harm during the course of service delivery; ensure that States
are protecting the health and welfare of individuals receiving section
1915(c) waiver program services; and safeguard people receiving section
1915(c) waiver program services from preventable or intentional harm.
In proposing an every other year timeframe for reporting, we were
attempting to take into account the likely frequency of State changes
to policies, procedures, and information systems, while also balancing
State reporting burden and the potential risk to beneficiaries if
States have incident management systems that are not compliant with the
proposed requirements at Sec. 441.302(a)(6). We believe every other
year timeframe for reporting is sufficient to detect substantial
changes to policies, procedures, and information systems and ensure
that we have accurate information on States' incident management
systems. We also propose, at Sec. 441.311(b)(1)(ii), to allow States
to reduce the frequency of reporting to up to once every 60 months for
States with incident management systems that are determined to meet the
requirements at proposed Sec. 441.302(a)(6). We expect to provide
States with technical assistance on how to meet the requirements at
proposed Sec. 441.302(a)(6). We invite comments on whether the
timeframe for States to report on the results of the incident
management system assessment is sufficient or if we should require
reporting more frequently (every year) or less frequently (every 3
years). We also invite comment on whether we should require reporting
more frequently (every 3 years or every 4 years) for States that are
determined to have an incident management system that meets the
requirements at Sec. 441.302(a)(6). If an alternate timeframe is
recommended, we request that commenters provide the rationale for that
alternate timeframe.
(2) Critical Incidents
As discussed earlier in section II.B.4. of this proposed rule, at
Sec. 441.302(a)(6)(i)(A), we propose to require States to define
critical incidents at a minimum as verbal, physical, sexual,
psychological, or emotional abuse; neglect; exploitation including
financial exploitation; misuse or unauthorized use of restrictive
interventions or seclusion; a medication error resulting in a telephone
call to or a consultation with a poison control center, an emergency
department visit, an urgent care visit, a hospitalization, or death; or
an unexplained or unanticipated death, including but not limited to a
death caused by abuse or neglect.
Based on the same rationale as discussed previously in section
II.B.7.a.(1) of this preamble related to the proposed incident
management system assessment proposed reporting requirement, at Sec.
441.311(b)(2), relying on our authority under section 1902(a)(6) of the
Act, we propose to require that States report annually on the number
and percent of critical incidents for which an investigation was
initiated within State-specified timeframes; number and percent of
critical incidents that are investigated and for which the State
determines the resolution within State-specified timeframes; and number
and percent of critical incidents requiring corrective action, as
determined by the State, for which the required corrective action has
been completed within State-specified timeframes. We intend to use the
information generated from the proposed reporting requirements at Sec.
441.311(b)(2)(ii) through (iv) to determine if States meet the
requirements at Sec. 441.302(a)(6)(ii). Given the risk of harm to
beneficiaries when effective incident management
[[Page 27988]]
systems are not in place, documented instances of abuse and neglect
among people receiving HCBS, and identified shortcomings and weaknesses
of States' incident management systems discussed earlier, we believe
the proposed requirement at Sec. 441.311(b)(2) for States to report
annually on critical incidents is in the best interest of and necessary
for protecting the health and welfare of individuals receiving section
1915(c) waiver program services. We invite comments on the timeframe
for States to report on the critical incidents, whether we should
require reporting less frequently (every 2 years), and if an alternate
timeframe is recommended, the rationale for the alternate timeframe.
(3) Person-Centered Planning
Under the authority of section 1902(a)(6) of the Act, we propose at
Sec. 441.311(b)(3) to require that States report annually to
demonstrate that they meet the requirements at Sec. 441.301(c)(3)(ii).
Specifically, at Sec. 441.311(b)(3)(i), we propose to require that
States report on the percent of beneficiaries continuously enrolled for
at least 365 days for whom a reassessment of functional need was
completed within the past 12 months. At Sec. 441.311(b)(3)(ii), we
propose to require that States report on the percent of beneficiaries
continuously enrolled for at least 365 days who had a service plan
updated as a result of a re-assessment of functional need within the
past 12 months. These proposed requirements are based on feedback
obtained during various interested parties' engagement activities
conducted with States and other interested parties over the past
several years about the reporting discussed in the 2014 guidance. As
discussed in section II.B.7. of this preamble, this feedback has
indicated that we should strengthen person-centered planning reporting
requirements, and eliminate annual performance measure reporting
requirements that provide limited useful data for assessing State
compliance with statutory and regulatory requirements. These proposed
requirements are also based on feedback received through the RFI \85\
discussed earlier about the need to standardize reporting and set
minimum standards for HCBS.
---------------------------------------------------------------------------
\85\ CMS Request for Information: Access to Coverage and Care in
Medicaid & CHIP. February 2022. For a full list of question from the
RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
---------------------------------------------------------------------------
As discussed in section II.B.1. of this preamble, we are proposing
a revision to the regulatory text so that it is clear that changes to
the person-centered service plan are not required if the re-assessment
does not indicate a need for changes. As such, for the purpose of the
reporting requirement at Sec. 441.311(b)(3)(ii), beneficiaries will be
considered to have had a service plan updated as a result of the re-
assessment if it is documented that the required re-assessment did not
indicate a need for changes.
For both of the metrics at Sec. 441.301(c)(3), we propose to allow
States to report on a statistically valid random sample of
beneficiaries, rather than for all individuals continuously enrolled in
the waiver program for at least 365 days. We invite comments on whether
there are other specific compliance metrics related to person-centered
planning that we should require States to report, either in place of or
in addition to the metrics we proposed. We also invite comments on the
timeframe for States to report on the person-centered planning, whether
we should require reporting less frequently (every 2 years), and if an
alternate timeframe is recommended, the rationale for the alternate
timeframe.
(4) Type, Amount, and Cost of Services
As discussed previously in section II.B.4. of this preamble, we
propose to amend Sec. 441.302(h) to avoid duplicative or conflicting
reporting requirements with the new Reporting Requirements section at
proposed Sec. 441.311. In particular, at Sec. 441.302(h), we propose
to remove paragraphs (1) and (2). At Sec. 441.311(b)(4), we propose to
add the language previously at Sec. 441.302(h)(1). In doing so, we are
proposing to retain the current requirement that States report on the
type, amount, and cost of services and to include the reporting
requirement in the new consolidated reporting section at Sec. 441.311.
b. Reporting on the Home and Community-Based Services (HCBS) Quality
Measure Set
At Sec. 441.311(c), relying on our authority under section
1902(a)(6) of the Act, we propose to require that States report every
other year on the HCBS Quality Measure Set, which is described later in
section II.B.8. of the preamble. Specifically, we propose, at Sec.
441.311(c)(1)(i), to require that States report every other year,
according to the format and schedule prescribed by the Secretary
through the process for developing and updating the HCBS Quality
Measure Set described later in section II.B.8. of the preamble, on
measures identified in the HCBS Quality Measure Set as mandatory
measures for States to report or are identified as measures for which
the Secretary will report on behalf of States, and, at Sec.
441.311(c)(1)(ii), to allow States to report on measures in the HCBS
Quality Measure Set that are not identified as mandatory, as described
later in this section of this proposed rule. We are proposing every
other year for State reporting in recognition of the fact that the
current, voluntary HCBS Quality Measure Set is heavily comprised of
survey-based measures, which are more burdensome, including for
beneficiaries who would be the respondents for the surveys, and
costlier to implement than other types of quality measures. Further, we
believe that requiring reporting every other year, rather than
annually, would better allow States to use the data that they report
for quality improvement purposes, as it would provide States with
sufficient time to implement interventions that would result in
meaningful improvement in performance scores from one reporting period
to another. We are also proposing this frequency in recognition of the
overall burden of the proposed requirements.
As discussed earlier in section II.B.1. of this preamble, section
1902(a)(19) of the Act requires States to provide safeguards to assure
that eligibility for Medicaid-covered care and services will be
determined and provided in a manner that is consistent with
simplification, simplicity of administration, and in the best interest
of Medicaid beneficiaries. Because the delivery of high quality
services is in the best interest of Medicaid beneficiaries, we propose
at Sec. 441.311(c)(1)(iii), under our authority at section 1902(a)(19)
of the Act, to require States to establish performance targets, subject
to our review and approval, for each of the measures in the HCBS
Quality Measure Set that are identified as mandatory for States to
report or are identified as measures for which we will report on behalf
of States, as well as to describe the quality improvement strategies
that they will pursue to achieve the performance targets for those
measures.\86\ We welcome comments on whether there should be a
threshold of compliance that would exempt the State from developing
improvement strategies, and if so, what that threshold should be.
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\86\ We note that compliance with CMS regulations and reporting
requirements does not imply that a State has complied with the
integration mandate of Title II of the ADA, as interpreted by the
Supreme Court in the Olmstead Decision.
---------------------------------------------------------------------------
At Sec. 441.311(c)(1)(iv), we propose to allow States to establish
State performance targets for other measures in the HCBS Quality
Measure Set that are not identified as mandatory for States to report
or as measures for which
[[Page 27989]]
the Secretary will report on behalf of States as well as to describe
the quality improvement strategies that they will pursue to achieve the
performance targets for those targets.
At Sec. 441.311(c)(2), we propose to report, on behalf of the
States, on a subset of measures in the HCBS Quality Measure Set that
are identified as measures for which we will report on behalf of
States. Further, at Sec. 441.311(c)(3), we propose to allow, but not
require, States to report on measures that are not yet required but
will be, and on populations for whom reporting is not yet required but
will be phased-in in the future.
We invite comments on whether the timeframe for States to report on
the measures in HCBS Quality Measure Set is sufficient, whether we
should require reporting more frequently (every year) or less
frequently (every 3 years), and if an alternate timeframe is
recommended, the rationale for that alternate timeframe. We welcome
comments on any additional changes we should consider in this section.
c. Access Reporting
As noted earlier in section II.B.6. of this preamble, feedback
obtained during various public engagement activities conducted with
States and other interested parties over the past several years about
reporting requirements for HCBS, as well as feedback received through
the RFI \87\ discussed earlier, indicate that there is a need to
improve public transparency and processes related to States' HCBS
waiting lists and for standardized reporting on HCBS access, including
timeliness of HCBS and the comparability to services received to
eligibility for services.
---------------------------------------------------------------------------
\87\ CMS Request for Information: Access to Coverage and Care in
Medicaid & CHIP. February 2022. For a full list of question from the
RFI, see: https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
---------------------------------------------------------------------------
At Sec. 441.311(d)(1)(i), relying on our authority under section
1902(a)(6) of the Act, we propose to require that States provide a
description annually on how they maintain the list of individuals who
are waiting to enroll in a section 1915(c) waiver program, if they have
a limit on the size of the waiver program and maintain a list of
individuals who are waiting to enroll in the waiver program, as
described in Sec. 441.303(f)(6). We further propose to require that
this description must include, but be not limited to, information on
whether the State screens individuals on the waiting list for
eligibility for the waiver program, whether the State periodically re-
screens individuals on the waiver list for eligibility, and the
frequency of re-screening if applicable. We also propose to require
States to report, at Sec. 441.311(d)(1)(ii), the number of people on
the waiting list, if applicable, and, at Sec. 441.311(d)(1)(iii), the
average amount of time that individuals newly enrolled in the waiver
program in the past 12 months were on the waiting list, if applicable.
We invite comments on whether there are other specific metrics or
reporting requirements related to waiting lists that we should require
States to report, either in place of or in addition to the requirements
we proposed. We also invite comments on the timeframe for States to
report on their waiting lists, whether we should require reporting less
frequently (every 2 or 3 years), and if an alternate timeframe is
recommended, the rationale for that alternate timeframe.
At Sec. 441.311(d)(2)(i), based on our authority under section
1902(a)(6) of the Act, we propose to require States report annually on
the average amount of time from when homemaker services, home health
aide services, or personal care services, as listed in Sec.
440.180(b)(2) through (4), are initially approved to when services
began, for individuals newly approved to begin receiving services
within the past 12 months. We propose to focus on these specific
services for this reporting requirement because of feedback from
States, consumer advocates, managed care plans, providers, and other
HCBS interested parties that timely access to these services is
especially challenging and because the failure of States to ensure
timely access to these services poses substantial risk to the health,
safety, and quality of care of individuals residing independently and
in other community-based residences. Having States report this
information will assist us in our oversight of State HCBS programs by
helping us target our technical assistance and monitoring efforts. We
request comment on whether this requirement should apply to additional
services authorized under section 1915(c) of the Act.
For this metric, we propose to allow States to report on a
statistically valid random sample of individuals newly approved to
begin receiving these services within the past 12 months, rather than
for all individuals newly approved to begin receiving these services
within the past 12 months. We invite comments on the timeframe for
States to report on this metric, whether we should require reporting
less frequently (every 2 or 3 years), and if an alternate timeframe is
recommended, the rationale for that alternate timeframe. We also invite
comments on whether there are other specific metrics related to the
amount of time that it takes for eligible individuals to begin
receiving homemaker services, home health aide services, or personal
care services that we should require States to report, either in place
of or in addition to the metric we proposed.
At Sec. 441.311(d)(2)(ii), also based on our authority under
section 1902(a)(6) of the Act, we propose to require States to report
annually on the percent of authorized hours for homemaker services,
home health aide services, or personal care services, as listed in
Sec. 440.180(b)(2) through (4), that are provided within the past 12
months. For this metric, we further propose to allow States to report
on a statistically valid random sample of individuals authorized to
receive these services within the past 12 months, rather than all
individuals authorized to receive these services within the past 12
months. We invite comments on the timeframe for States to report on
this metric, whether we should require reporting less frequently (every
2 or 3 years), and if an alternate timeframe is recommended, the
rationale for that alternate timeframe. We also invite comments on
whether there are other specific metrics related to individuals' use of
authorized homemaker services, home health aide services, or personal
care services that we should require States to report, either in place
of or in addition to the metric we proposed. We further request comment
on whether this requirement should apply to additional services
authorized under section 1915(c) of the Act.
d. Payment Adequacy
At Sec. 441.311(e), we propose new reporting requirements for
section 1915(c) waivers, under our authority at section 1902(a)(6) of
the Act, for States to demonstrate that they meet the proposed HCBS
Payment Adequacy requirements at Sec. 441.302(k). Specifically, we
propose that States report annually on the percent of payments for
homemaker, home health aide, and personal care services, as listed at
Sec. 440.180(b)(2) through (4), that are spent on compensation for
direct care workers. As discussed in section II.B.5. of this preamble,
we have focused this requirement on homemaker services, home health
aide services, and personal care services because they are services for
which we expect that the vast majority of payment should be comprised
of compensation for direct care workers and for which there would be
low facility or other indirect costs. These are services that would
most commonly be conducted in individuals' homes and general community
settings.
[[Page 27990]]
As such, there should be low facility or other indirect costs
associated with the services.
We considered whether the proposed reporting requirements at Sec.
441.311(e) related to the percent of payments going to the direct care
workforce should apply to other services, such as adult day health,
habilitation, day treatment or other partial hospitalization services,
psychosocial rehabilitation services and clinic services for
individuals with chronic mental illness. As discussed in section
II.B.5. of this preamble, these services may have facility or other
indirect costs for which we do not have adequate information to
determine a minimum percent of the payment that should be spent on
compensation for the direct care workforce and, as a result, we are not
proposing to apply HCBS Payment Adequacy requirements at Sec.
441.302(k) to services other than homemaker, home health aide, and
personal care services, as listed at Sec. 440.180(b)(2) through (4).
However, we are requesting comment on whether the proposed requirements
at Sec. 441.302(k)(3)(i) related to the percent of payments going to
the direct care workforce should apply to other services listed at
Sec. 440.180(b). In particular, we are requesting comment on whether
the proposed requirements at Sec. 441.302(k)(3)(i) related to the
percent of payments going to the direct care workforce should apply to
residential habilitation services, day habilitation services, and home-
based habilitation services. As a result, we are also requesting
comment whether States should be required to report annually on the
percent of payments for other services listed at Sec. 440.180(b) that
are spent on compensation for direct care workers and, in particular,
on the percent of payments for residential habilitation services, day
habilitation services, and home-based habilitation services that are
spent on compensation for direct care workers.
We further propose that States separately report for each service
subject to the reporting requirement and, within each service,
separately report on payments for services that are self-directed. We
considered whether other reporting requirements such as a State
assurance or attestation or an alternative frequency of reporting could
be used to determine State compliance with the requirement at Sec.
441.302(k) and decided that the proposed requirement would be most
effective to demonstrate State compliance. We request comment on
whether we should allow States to provide an assurance or attestation,
subject to audit, that they meet the requirement in place of reporting
on the percent of payments, and whether we should reduce the frequency
of reporting to every other year.
The intent of this proposed requirement is for States to report in
the aggregate for each service across all of their services across all
programs as opposed to separately report for each waiver or HCBS
program. As an alternative, we considered whether to require reporting
at the delivery system, HCBS waiver program, or population level.
However, we are not proposing to require additional levels of reporting
because we expect that it would increase reporting burden for States
without providing us with additional information necessary for
determining whether States meet the requirements at Sec. 441.302(k).
We request comment on whether we should require States to report on the
percent of payments for certain HCBS that are spent on compensation for
direct care workers at the delivery system, HCBS waiver program, or
population level. In addition, we considered whether to require States
to report on median hourly wage and on compensation by category,
including salary, wages, and other remuneration; benefits; and payroll
taxes. We believe that such information would be valuable for better
monitoring workforce compensation and its impact on workforce shortages
and turnover and access to services for Medicaid beneficiaries. While
such information should be readily accessible for providers, we have
not proposed requiring these types of reporting, as collecting and
aggregating such information would increase State burden. We request
comment on whether we should require States to report on median hourly
wage and on compensation by category. We considered whether to allow
States, at their option, to exclude, from their reporting to CMS but
not from the proposed requirement at Sec. 441.302(k) related to the
percent of payments that are spent on compensation for direct care
workers, payments to providers of agency-directed services that have
low Medicaid revenues or serve a small number of Medicaid
beneficiaries, based on Medicaid revenues for the service, number of
direct care workers serving Medicaid beneficiaries, or the number of
Medicaid beneficiaries receiving the service. We considered this option
as a way to reduce State, managed care plan, and provider data
collection and reporting burden based on the experience of States that
have implemented similar reporting requirements. However, we are
concerned that such an option could discourage providers from serving
Medicaid beneficiaries or increasing the number of Medicaid
beneficiaries or amount of Medicaid revenues. We request comment on
whether we should allow States the option to exclude, from their
reporting to CMS, payments to providers of agency directed services
that have low Medicaid revenues or serve a small number of Medicaid
beneficiaries, based on Medicaid revenues for the service, number of
direct care workers serving Medicaid beneficiaries, or the number of
Medicaid beneficiaries receiving the service.
We also request comment on whether we should establish a specific
limit on this exclusion and, if so, the specific limit we should
establish, such as to limit the exclusion to providers in the lowest
5th, 10th, 15th, or 20th percentile of providers in terms Medicaid
revenues for the service, number of Medicaid beneficiaries served, or
number of direct care workers serving Medicaid beneficiaries.
We also considered whether to allow States to exclude payments for
self-directed services from this reporting requirement, based on
feedback obtained during various interested parties' engagement
activities conducted with States and other interested parties over the
past several years related to HCBS workforce shortages that indicate
that compensation for direct care workers in self-directed models tends
to be higher and may comprise a higher percentage of the payments for
services than other HCBS, and that administrative costs account for a
small percentage of the cost of self-directed services. However, we
have decided that payments for self-directed services by States should
be included in these reporting requirements. This decision not to
exclude them was based on the importance of ensuring a sufficient
direct care workforce for self-directed services, the experience of
States that have applied similar requirements to report on the percent
of payments for to self-directed services that are spent on
compensation for direct care workers, and the lack of conclusive data
indicating that compensation for direct care workers meets or exceeds
the proposed 80 percent threshold. We request comment on whether we
should allow States to exclude payments for self-directed services from
these reporting requirements.
e. Effective Date
We recognize that many States may need time to implement these
reporting requirements, including to amend provider agreements or
managed care contracts, make State regulatory or
[[Page 27991]]
policy changes, implement process or procedural changes, update
information systems for data collection and reporting, or conduct other
activities to implement these requirements. As a result, we are
proposing at Sec. 441.311(f)(1) to provide States with 3 years to
implement the compliance reporting requirements at Sec. 441.311(b),
the HCBS Quality Measure Set reporting requirements at Sec.
441.311(c), and the access reporting requirements at Sec. 441.311(d)
in FFS delivery systems following the effective date of the final rule.
For States with managed care delivery systems under the authority of
sections 1915(a), 1915(b), 1932(a), or 1115(a) of the Act and that
include HCBS in the MCO's, PIHP's, or PAHP's contract, we are proposing
to provide States until the first managed care plan contract rating
period that begins on or after 3 years after the effective date of the
final rule to implement these requirements. This time period is based
on feedback from States and other interested parties that it could take
2 to 3 years to amend State regulations and work with their State
legislatures, if needed, as well as to revise policies, operational
processes, information systems, and contracts to support implementation
of these proposed reporting requirements. We also have considered all
of the HCBS proposals outlined in this proposed rule as whole. We
invite comments on whether this timeframe is sufficient, whether we
should require a shorter timeframe (2 years) or longer timeframe (4
years) to implement these provisions, and if an alternate timeframe is
recommended, the rationale for that alternate timeframe.
In addition, we are proposing at Sec. 441.311(f)(2) to provide
States with 4 years to implement the payment adequacy reporting
requirements at Sec. 441.311(e) in FFS delivery systems following the
effective date of the final rule. For States with managed care delivery
systems under the authority of sections 1915(a), 1915(b), 1932(a), or
1115(a) of the Act and that include HCBS in the MCO's, PIHP's, or
PAHP's contract, we are proposing to provide States until the first
managed care plan contract rating period that begins on or after 4
years after the effective date of the final rule to implement these
requirements. This time period is intended to align with the effective
date for the HCBS payment adequacy requirements at Sec. 441.302(k),
which are discussed in section II.B.5. of this preamble. It is also
based on feedback from States and other interested parties that it
could take 3 to 4 years to amend State regulations and work with their
State legislatures, if needed, as well as to revise policies,
operational processes, information systems, and contracts to support
implementation of these reporting requirements. We also have considered
all of the HCBS proposals outlined in this proposed rule as whole. We
invite comments on whether this timeframe is sufficient, whether we
should require a shorter timeframe (3 years) or longer timeframe (5
years) to implement these provisions, and if an alternate timeframe is
recommended, the rationale for that alternate timeframe.
At Sec. 441.311(f), we propose to apply all of the reporting
requirements described in Sec. 441.311 to services delivered under FFS
and managed care delivery systems. As discussed earlier in section
II.B.1. of this preamble, section 2402(a)(3)(A) of the Affordable Care
Act requires States to improve coordination among, and the regulation
of, all providers of Federally and State-funded HCBS programs to
achieve a more consistent administration of policies and procedures
across HCBS programs, and as noted in the Medicaid context this would
include consistent administration between FFS and managed care
programs. We accordingly are proposing to specify that a State must
ensure compliance with the requirements in Sec. 441.302(a)(6) with
respect to HCBS delivered both under FFS and managed care delivery
systems.
As discussed earlier in section II.B.1. of this preamble, the
proposed requirements at Sec. 441.311, in combination with other
proposed requirements identified throughout this proposed rule, are
intended to supersede and fully replace the reporting expectations and
the minimum 86 percent performance level for State's performance
measures described in the 2014 guidance, also discussed earlier in
section II.B.1. of this preamble. We expect that States may implement
some of the requirements proposed in this proposed rule in advance of
any effective date. If the rule is finalized, we will work with States
to phase out the 2014 guidance as they implement the requirements in
the future final rule to reduce unnecessary burden and to avoid
duplicative or conflicting reporting requirements.
In accordance with the requirement of section 2402(a)(3)(A) of the
Affordable Care Act for States to achieve a more consistent
administration of policies and procedures across HCBS programs, and
because these reporting requirements are relevant to other HCBS
authorities, we are proposing to incorporate these requirements within
the applicable regulatory sections for other HCBS authorities.
Specifically, we propose to apply the requirements at Sec. 441.311 to
section 1915(j), (k), and (i) State plan services by cross-referencing
at Sec. Sec. 441.474(c), 441.580(i), and 441.745(a)(1)(vii),
respectively. Consistent with our proposal for section 1915(c) waivers,
we propose these requirements based on our authority under section
1902(a)(6) of the Act, which requires State Medicaid agencies to make
such reports, in such form and containing such information, as the
Secretary may from time to time require, and to comply with such
provisions as the Secretary may from time to time find necessary to
assure the correctness and verification of such reports. We believe the
same arguments for proposing these requirements for section 1915(c)
waivers are equally applicable for these other HCBS authorities. We
request comment on the application of these provisions across section
1915(i), (j), and (k) authorities. To accommodate the addition of new
language at Sec. 441.580(i), we are proposing to renumber existing
Sec. 441.580(i) as Sec. 441.580(j).
We considered whether to also apply these reporting requirements to
section 1905(a) ``medical assistance'' State plan personal care, home
health, and case management services. However, we are not proposing
that these requirements apply to any section 1905(a) State plan
services based on State feedback that they do not have the same data
collection and reporting capabilities in place for section 1905(a)
services as they do for sections 1915(c), (i), (j), and (k) services
and because the person-centered planning, service plan, and waiting
list requirements that comprise a significant portion of these
reporting requirements have little to no relevance for section 1905(a)
services, in comparison to section 1915(c), (i), (j), and (k) services.
Further, the vast majority of HCBS is delivered under section 1915(c),
(i), (j), and (k) authorities, while only a small percentage of HCBS
nationally is delivered under section 1905(a) State plan authority. We
request comment on whether we should establish similar reporting
requirements for section 1905(a) ``medical assistance'' State plan
personal care, home health, and case management services.
We expect that, should we finalize these reporting requirements, we
will establish new processes and forms for States to meet the reporting
requirements, provide additional technical information on how States
can meet the reporting requirements including related to sampling
requirements (where States are
[[Page 27992]]
permitted to report on a sample of beneficiaries rather than on all
individuals who meet the inclusion criteria for the reporting
requirement), and amend existing templates and establish new templates
under the Paperwork Reduction Act.
8. Home and Community-Based Services (HCBS) Quality Measure Set
(Sec. Sec. 441.312, 441.474(c), 441.585(d), and 441.745(b)(1)(v)
On July 21, 2022, we issued State Medicaid Director Letter # 22-003
\88\ to release the first official version of the HCBS Quality Measure
Set. The HCBS Quality Measure Set is a set of nationally standardized
quality measures for Medicaid-covered HCBS. It is intended to promote
more common and consistent use within and across States of nationally
standardized quality measures in HCBS programs, create opportunities
for CMS and States to have comparative quality data on HCBS programs,
drive improvement in quality of care and outcomes for people receiving
HCBS, and support States' efforts to promote equity in their HCBS
programs. It is also intended to reduce some of the burden that States
and other interested parties may experience in identifying and using
HCBS quality measures. By providing States and other interested parties
with a set of nationally standardized measures to assess HCBS quality
and outcomes and by facilitating access to information on those
measures, we believe that we can reduce the time and resources that
States and other interested parties expend on identifying, assessing,
and implementing measures for use in HCBS programs.
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\88\ CMS State Medicaid Director Letter. SMD# 22-003 Home and
Community-Based Services Quality Measure Set. July 2022. Accessed at
https://www.medicaid.gov/federal-policy-guidance/downloads/smd22003.pdf.
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Section 1102(a) of the Act provides the Secretary of HHS with
authority to make and publish rules and regulations that are necessary
for the efficient administration of the Medicaid program. Section
1902(a)(6) of the Act requires State Medicaid agencies to make such
reports, in such form and containing such information, as the Secretary
may from time to time require, and to comply with such provisions as
the Secretary may from time to time find necessary to assure the
correctness and verification of such reports. Under our authority at
sections 1102(a) and 1902(a)(6) of the Act, we are proposing to add a
new section, at Sec. 441.312, Home and Community-Based Services
Quality Measure Set, to require use of the measure set in 1915(c)
waiver programs and promote public transparency related to the
administration of Medicaid-covered HCBS. We describe the basis and
scope of this section in proposed paragraph (a).
We believe that quality is a critical component of efficiency, and
as such, having a standardized set of measures that is used to assess
the quality of Medicaid HCBS programs supports the efficient operation
of the Medicaid program. Further, we believe that this proposal is
necessary for the efficient administration of Medicaid-covered HCBS
authorized under section 1915(c) of the Act, consistent with section
1902(a)(4) of the Act, as it would establish a process through which we
would regularly update and maintain the required set of measures at
Sec. 441.311(c) in consultation with States and other interested
parties (as described later in this section of the preamble). This
process would ensure that the priorities of interested parties are
reflected in the selection of the measures included in the HCBS Quality
Measure Set. This process would also ensure that the required set of
HCBS quality measures is updated to address gaps in the HCBS Quality
Measure Set as new measures are developed and to remove measures that
are less relevant or add less value than other available measures, and
that it meets scientific and other standards for quality measures. Due
to the constantly evolving field of HCBS quality measurement, we
believe that the failure to establish such a process would result in
ongoing reporting by States of measures that do not reflect the
priorities of interested parties, measures that offer limited value
compared to other measures, and measures that do not meet strong
scientific and other standards. It would also result in a lack of
reporting on key measurement priority areas, which could be addressed
by updating the HCBS Quality Measure Set as new measures are developed.
The failure to establish such a process would lead to inefficiency in
States' HCBS quality measurement activities through the continued
reporting on an outdated set of measures. In other words, we believe
that such a process is necessary for the efficient administration of
Medicaid-covered HCBS by ensuring that quality measure reporting
requirements are focused on the most valuable, useful, and
scientifically supported areas of quality measurement, and that quality
measures with limited value are removed timely from quality measure
reporting requirements.
We propose a definition at Sec. 441.312(b)(1) for ``Attribution
rules,'' to mean the process States use to assign beneficiaries to a
specific health care program or delivery system for the purpose of
calculating the measures on the ``HCBS Quality Measure Set'' as
described in proposed Sec. 441.312(d)(6), and at Sec. 441.312(b)(2)
for ``Home and Community-Based Services Quality Measure Set'' to mean
the Home and Community-Based Measures for Medicaid established and
updated at least every other year by the Secretary through a process
that allows for public input and comments, including through the
Federal Register.
At Sec. 441.312(c), we describe the general process that the
Secretary will follow to update and maintain the HCBS Quality Measure
Set. Specifically, at Sec. 441.312(c)(1), we propose that the
Secretary will identify and update at least every other year, through a
process that allows for public input and comment, the quality measures
to be included in the HCBS Quality Measure Set. At Sec. 441.312(c)(2),
we propose that the Secretary will solicit comment at least every other
year with States and other interested parties, which are identified
later in this section of the preamble, to:
Establish priorities for the development and advancement
of the HCBS Quality Measure Set.
Identify newly developed or other measures which should be
added including to address gaps in the measures included in the HCBS
Quality Measure Set.
Identify measures which should be removed as they no
longer strengthen the HCBS Quality Measure Set.
Ensure that all measures included in the HCBS Quality
Measure Set are evidence-based, are meaningful for States, and are
feasible for State-level and program-level reporting as appropriate.
The proposed frequency for updating the quality measures included
in the HCBS Quality Measure Set is aligned with the proposed frequency
at Sec. 441.311(c)(1)(i) for States' reporting of the measures in the
HCBS Quality Measure Set. We have based other aspects of the process
that the Secretary will follow to update and maintain the HCBS Quality
Measure Set in part on the proposed processes for the Secretary to
update and maintain the Child, Adult, and Health Home Core Sets as
described in the Medicaid Program and CHIP; Mandatory Medicaid and
[[Page 27993]]
Children's Health Insurance Program (CHIP) Core Set Reporting proposed
rule (87 FR 51303); (hereinafter the ``Mandatory Medicaid and CHIP Core
Set Reporting proposed rule''). We believe that such alignment in
processes will ensure consistency and promote efficiency for both CMS
and States across Medicaid quality measurement and reporting
activities.
At Sec. 441.312(c)(3), we propose that the Secretary will, in
consultation with States and other interested parties (as described
later in this section of preamble), develop and update the measures in
the HCBS Quality Measure Set, at least every other year, through a
process that allows for public input and comment. We invite comments on
whether the timeframes for updating the measures in the HCBS Quality
Measure Set and conducting the process for developing and updating the
HCBS Quality Measure Set is sufficient, whether we should conduct these
activities more frequently (every year) or less frequently (every 3
years), and if an alternate timeframe is recommended, the rationale for
that alternate timeframe.
At Sec. 441.312(d), we describe the proposed process for
developing and updating the HCBS Quality Measure Set. Specifically, we
propose that the Secretary will address the following through the
proposed process:
Identify all measures in the HCBS Quality Measure Set,
including newly added measures, measures that have been removed,
mandatory measures, measures that the Secretary will report on States'
behalf, measures that States can elect to have the Secretary report on
their behalf, as well as the measures that the Secretary will provide
States with additional time to report and the amount of additional
time.
Inform States how to collect and calculate data on the
measures.
Provide a standardized format and reporting schedule for
reporting the measures.
Provide procedures that States must follow in reporting
the measure data.
Identify specific populations for which States must report
the measures, including people enrolled in a specific delivery system
type, people who are dually eligible for Medicare and Medicaid, older
adults, people with physical disabilities, people with intellectual or
developmental disabilities, people who have serious mental illness, and
people who have other health conditions; and provide attribution rules
for determining how States must report on measures for beneficiaries
who are included in more than one population.
Identify the subset of measures that must be stratified by
race, ethnicity, Tribal status, sex, age, rural/urban status,
disability, language, or such other factors as may be specified by the
Secretary.
Describe how to establish State performance targets for
each of the measures.
We anticipate that, for State reporting on the measures in the HCBS
Quality Measure Set, as outlined in Sec. 441.311, the technical
information on attribution rules described at proposed Sec.
441.312(d)(6), would call for inclusion in quality reporting based on a
beneficiary's continuous enrollment in the Medicaid waiver. This would
ensure the State has enough time to furnish services during the
measurement period. In the technical information, we anticipate we
would set attribution rules to address transitions in Medicaid
eligibility, enrollment in Medicare, or transitions between different
delivery systems or managed care plans, within a reporting year, for
example, based on the length of time beneficiaries was enrolled in
each. We invite comment on other considerations we should address in
the attribution rules or other topics we should address in the
technical information.
At Sec. 441.312(e), we propose, in the process for developing and
updating the Home and Community-Based Services Quality Measure Set
described at proposed Sec. 441.312(d), that the Secretary consider the
complexity of State reporting and allow for the phase-in over a
specified period of time of mandatory State reporting for some measures
and of reporting for certain populations, such as older adults or
people with intellectual and disabilities. At Sec. 441.312(f), we
propose that, in specifying the measures and the factors by which
States must report stratified measures, the Secretary will consider
whether such stratified sampling can be accomplished based on valid
statistical methods, without risking a violation of beneficiary
privacy, and, for measures obtained from surveys, whether the original
survey instrument collects the variables or factors necessary to
stratify the measures. This proposed stratification of data for the
measures contained in the HCBS Quality Measure Set is consistent with
our statutory authority under section 1902(a)(6) of the Act, which
requires States to report information ``in such form and containing
such information'' as the Secretary requires.
Stratified sampling is a method of sampling from a population, in
which the sampling can be partitioned into sub-populations, such as by
race, ethnicity, sex, age, rural/urban status, disability, language, or
such other factors. Stratified data would enable us and States to
identify the health and quality of life outcomes of underserved
populations and potential differences in outcomes based on race,
ethnicity, sex, age, rural/urban status, disability, language, or such
factors on measures contained in the HCBS Quality Measure Set.
Measuring health disparities, reporting these results, and driving
improvements in quality are cornerstones of the CMS approach to
advancing health equity. Advancing equity for underserved populations
through data reporting and stratification aligns with E.O. 13985.\89\
In line with the policy objective of E.O. 13985, CMS defines health
equity as ``the attainment of the highest level of health for all
people, where everyone has a fair and just opportunity to attain their
optimal health regardless of race, ethnicity, disability, sexual
orientation, gender identity, socioeconomic status, geography,
preferred language, or other factors that affect access to care and
health outcomes.'' \90\ We are working to advance health equity by
designing, implementing, and operationalizing policies and programs
that support health for all the people served by our programs,
eliminating avoidable differences in health and quality of life
outcomes experienced by people who are disadvantaged or underserved,
and providing the care and support that all individuals need to thrive.
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\87\ Exec. Order No. 13985 (2021), Accessed at https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
\90\ CMS definition of health equity. Accessed at https://www.cms.gov/pillar/health-equity.
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We considered giving States the flexibility to choose which
measures they would stratify and by what factors. However, as discussed
in the Mandatory Medicaid and CHIP Core Set Reporting rule (87 FR
51313), consistent measurement of differences in health and quality of
life outcomes between different groups of beneficiaries is essential to
identifying areas for intervention and evaluation of those
interventions.\91\ This consistency could
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\91\ Schlotthauer AE, Badler A, Cook SC, Perez DJ, Chin MH.
Evaluating Interventions to Reduce Health Care Disparities: An RWJF
Program. Health Aff (Millwood). 2008;27(2):568-573.
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[[Page 27994]]
not be achieved if each State made its own decisions about which data
it would stratify and by what factors.92 93
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\92\ Centers for Medicare & Medicaid Services (CMS) Office of
Minority Health (OMH). Stratified Reporting. 2022; https://www.cms.gov/About-CMS/Agency-Information/OMH/research-and-data/statistics-and-data/stratified-reporting.
\93\ National Quality Forum. A Roadmap for Promoting Health
Equity and Eliminating Disparities. Sep 2017. Accessed at https://www.qualityforum.org/Publications/2017/09/A_Roadmap_for_Promoting_Health_Equity_and_Eliminating_Disparities__The_Four_I_s_for_Health_Equity.aspx.
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We recognize that States may be constrained in their ability to
stratify measures in the HCBS Quality Measure Set and that data
stratification would require additional State resources. There are
several challenges to stratification of measure reporting. First, the
validity of stratification is threatened when the demographic data are
incomplete. Complete demographic information is often unavailable to us
and to States due to several factors, including the fact that Medicaid
applicants and beneficiaries are not required to provide race and
ethnicity data. Second, when States with smaller populations and less
diversity stratify data, it may be possible to identify individual
data, raising privacy concerns. Therefore, if the sample sizes are too
small, the data would be suppressed, in accordance with the CMS Cell
Size Suppression Policy and the data suppression policies for
associated measure stewards and therefore not publicly reported to
avoid a potential violation of privacy.\94\
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\94\ CMS Cell Size Suppression Policy, Issued 2020: https://www.hhs.gov/guidance/document/cms-cell-suppression-policy or the
cell suppression standards of the associated measure stewards.
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We also may face constraints in stratifying measures for which we
are able to report on behalf of States, as our ability to stratify will
be dependent on whether the original dataset or survey instrument: (1)
collects the demographic information or other variables needed and (2)
has a large enough sample size. The Transformed Medicaid Statistical
Information System (T-MSIS), for example, currently has the capability
to stratify some HCBS Quality Measure Set measures by sex and urban/
rural status, but not by race, ethnicity, or disability status. This is
because applicants provide information on sex and urban/rural address,
which is reported to T-MSIS by States, whereas applicants are not
required to provide information on their race and ethnicity or
disability status, and often do not do so. However, we have developed
the capacity to impute race and ethnicity using a version of the
Bayesian Improved Surname Geocoding (BISG) method \95\ that includes
Medicaid-specific enhancements to optimize accuracy, and are able to
stratify by race and ethnicity, urban/rural status, and sex.
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\95\ Elliott, Marc N., et al. ``Using the Census Bureau's
surname list to improve estimates of race/ethnicity and associated
disparities.'' Health Services and Outcomes Research Methodology 9.2
(2009): 69-83.
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The method proposed for this project utilizes State-submitted race/
ethnicity data when it is complete and accurate as based on the
Medicaid DQ Atlas assessment for a given year.\96\ When State-submitted
data is missing or inaccurate, imputed results are used to ensure
statistical accuracy. Because imputations are only used when self-
reported data is missing or States have systematic errors in reporting
race and/or ethnicity, millions of self-reported datapoints are
preserved and model accuracy is improved. This also reflects that, as
the quality of State-submitted data improves, the imputations will be
used less frequently. We will release detailed documentation about the
methodology used to develop the imputations prior to the release of
these results. While complete demographic information for beneficiaries
would always be preferable to using imputed model values, reliable
techniques to impute values is a substitute to enable identification
and analysis of health disparities.
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\96\ Medicaid DQ Atlas. ``Race and Ethnicity.'' https://www.medicaid.gov/dq-atlas/landing/topics/single/map?topic=g3m16&tafVersionId=32.
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With these challenges in mind, we propose that stratification by
States in reporting of HCBS Quality Measure Set data would be
implemented through a phased-in approach in which the Secretary would
specify which measures and by which factors States must stratify
reported measures. In proposed Sec. 441.312(f), States would be
required to provide stratified data for 25 percent of the measures in
the HCBS Quality Measure Set for which the Secretary has specified that
reporting should be stratified by 3 years after the effective date of
these regulations, 50 percent of such measures by 5 years after the
effective date of these regulations, and 100 percent of measures by 7
years after the effective date of these regulations. We note that the
percentages listed here align with the proposed phase-in of equity
reporting in the Mandatory Medicaid and CHIP Core Set Reporting
proposed rule, although the proposed deadlines for each compliance
level would be longer here (87 FR 51314). However, the timeframe
associated with each percentage is different from what was proposed in
that rule. Specifically, that proposed rule would require States to
provide stratified data for 25 percent of measures within 2 years after
the effective date of the final rule, 50 percent of measures within 3
years after the effective date of the final rule, and 100 percent of
measures within 5 years after the effective date of the final rule.
We propose a slower phase-in for stratification for the measures in
the HCBS Quality Measure Set because the HCBS Quality Measure Set was
only first released for voluntary use by States in July 2022, while
Child, Adult, and Health Home Core Sets voluntary reporting has been in
place for a number of years. Further, a substantial portion of the
measures included in the HCBS Quality Measure Set, particularly
compared to the Child, Adult, and Health Home Core Sets, are derived
from beneficiary experience of care surveys, which are costlier to
implement than other types of measures. In addition, the slower phase-
in is also intended to take into consideration the overall burden of
the reporting requirements in this proposed rule.
We have determined that this proposed phased-in approach to data
stratification would be reasonable and minimally burdensome, and thus
consistent with E.O. 13985 on Advancing Racial Equity and Support for
Underserved Communities Through the Federal Government (January 20,
2021),\97\ because we are balancing the importance of being able to
identify differences in outcomes between populations under these
measures with the potential operational challenges that States may face
in implementing these proposed requirements.
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\97\ Exec. Order No. 13985 (2021), Accessed at https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
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We recognize that States may need to make enhancements to their
data and information systems or incur other costs in implementing the
HCBS Quality Measure Set. We remind States that enhanced FFP is
available at a 90 percent match rate for the design, development, or
installation of improvements of mechanized claims
[[Page 27995]]
processing and information retrieval systems, in accordance with
applicable Federal requirements.\98\ Enhanced FFP at a 75 percent match
rate is also available for operations of such systems, in accordance
with applicable Federal requirements.\99\ Receipt of these enhanced
funds is conditioned upon States meeting a series of standards and
conditions to ensure investments are efficient and effective.\100\
States are also encouraged to advance the interoperable exchange of
HCBS data and support quality improvement activities by adopting
standards in 45 CFR part 170 and other relevant standards identified in
the ISA.\101\
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\98\ See section 1903(a)(3)(A)(i) of the Act and Sec.
433.15(b)(3), 80 FR 75817 through 75843; https://www.medicaid.gov/state-resourcecenter/faq-medicaid-and-chip-affordable-care-act-implementation/downloads/affordable-care-act-faq-enhancedfunding-for-medicaid.pdf; https://www.medicaid.gov/federal-policy-guidance/downloads/SMD16004.pdf.
\99\ See section 1903(a)(3)(B) and Sec. 433.15(b)(4).
\100\ See Sec. 433.112 (b, 80 FR 75841; https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-C/part-433/subpart-C.
\101\ Relevant standards adopted by HHS and identified in the
ISA include the USCDI (https://www.healthit.gov/isa/united-states-core-data-interoperability-uscdi), eLTSS (https://www.healthit.gov/isa/documenting-care-plans-person-centered-services), and Functional
Assessment Standardized Items (https://www.healthit.gov/isa/representing-patient-functional-status-andor-disability).
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We solicit comments on the proposed schedule for phasing in
reporting of HCBS Quality Measure Set data. We also seek comment on
whether we should phase-in reporting on all of the measures in the HCBS
Quality Measure Set.
At Sec. 441.312(g), we propose the list of interested parties with
whom the Secretary must consult to specify and update the quality
measures established in the HCBS Quality Measure Set. The proposed list
of interested parties includes: State Medicaid Agencies and agencies
that administer Medicaid-covered HCBS; health care and HCBS
professionals who specialize in the care and treatment of older adults,
children and adults with disabilities, and individuals with complex
medical needs; health care and HCBS professionals, providers, and
direct care workers who provide services to older adults, children and
adults with disabilities and complex medical and behavioral health care
needs who live in urban and rural areas or who are members of groups at
increased risk for poor outcomes; HCBS providers; direct care workers
and organizations representing direct care workers; consumers and
national organizations representing consumers; organizations and
individuals with expertise in HCBS quality measurement; voluntary
consensus standards setting organizations and other organizations
involved in the advancement of evidence-based measures of health care;
measure development experts; and other interested parties the Secretary
may determine appropriate.
Because these quality measurement requirements are relevant to
other HCBS authorities, we are proposing to incorporate these
requirements within the applicable regulatory sections for other HCBS
authorities. Specifically, we propose to apply the proposed
requirements at Sec. 441.312 to section 1915(j), (k), and (i) State
plan services by cross-referencing at Sec. Sec. 441.474(c),
441.585(d), and 441.745(b)(1)(v), respectively. Consistent with our
proposal for section 1915(c) waivers, we propose these requirements
based on our authority under section 1902(a)(6) of the Act, which
requires State Medicaid agencies to make such reports, in such form and
containing such information, as the Secretary may from time to time
require, and to comply with such provisions as the Secretary may from
time to time find necessary to assure the correctness and verification
of such reports. We believe the same arguments for proposing these
requirements for section 1915(c) waivers are equally applicable for
these other HCBS authorities. We request comment on the application of
these provisions across sections 1915(i), (j), and (k) authorities.
9. Website Transparency (Sec. Sec. 441.313, 441.486, 441.595, and
441.750)
Section 1102(a) of the Act provides the Secretary of HHS with
authority to make and publish rules and regulations that are necessary
for the efficient administration of the Medicaid program. Under our
authority at section 1102(a) of the Act, we are proposing to add a new
section, at Sec. 441.313, titled Website transparency, to promote
public transparency related to the administration of Medicaid-covered
HCBS. As noted earlier in section II.B.8. of this preamble, we believe
that quality is a critical component of efficiency, as payments for
services that are low quality do not produce their desired effects and,
as such, are more wasteful than payments for services that are high
quality. However, feedback from interested parties during various
public engagement activities over the past several years have indicated
that it is difficult to find information on HCBS access, quality, and
outcomes in many States. As a result, it is not possible for
beneficiaries, consumer advocates, oversight entities, or other
interested parties to hold States accountable for ensuring that
services are accessible and high quality for people who need Medicaid
HCBS. As a result, we believe that the proposal described immediately
below supports the efficient administration of Medicaid-covered HCBS
authorized under section 1915(c) of the Act by promoting public
transparency and accountability of the quality and performance of
Medicaid HCBS systems, as the availability of such information will
improve the ability of interested parties to hold States accountable
for the quality and performance of their HCBS systems.
Specifically, at Sec. 441.313(a), we propose to require States to
operate a website that meets the availability and accessibility
requirements at Sec. 435.905(b) of this chapter and that provides the
results of the reporting requirements under newly proposed Sec.
441.311 (specifically, incident management, critical incident, person
centered planning, and service provision compliance data; data on the
HCBS Quality Measure Set; access data; and payment adequacy data). We
request comment on whether the requirements at Sec. 435.905(b) are
sufficient to ensure the availability and the accessibility of the
information for people receiving HCBS and other HCBS interested parties
and for specific requirements to ensure the availability and
accessibility of the information.
At Sec. 441.313(a)(1), we propose to require that the data and
information that States are required to report under Sec. 441.311 be
provided on one web page, either directly or by linking to the web
pages of the managed care organization, prepaid ambulatory health plan,
prepaid inpatient health plan, or primary care case management entity
that is authorized to provide services. We request comment on whether
States should be permitted to link to web pages of these managed care
entities and whether we should limit the number of separate web pages
that a State could link to, in place of directly reporting the
information on its own web page.
At Sec. 441.313(a)(2), we propose to require that the web page
include clear and easy to understand labels on documents and links. We
request comment on whether these requirements are sufficient to ensure
the accessibility of the information for people receiving HCBS and
other HCBS interested parties and for specific requirements to ensure
the accessibility of the information.
At Sec. 441.313(a)(3), we propose to require that States verify
the accurate function of the website and the timeliness of the
information and links
[[Page 27996]]
at least quarterly. We request comment on whether this timeframe is
sufficient or if we should require a shorter timeframe (monthly) or a
longer timeframe (semi-annually or annually).
At Sec. 441.313(a)(4), we propose to require that States include
prominent language on the website explaining that assistance in
accessing the required information on the website is available at no
cost and include information on the availability of oral interpretation
in all languages and written translation available in each non-English
language, how to request auxiliary aids and services, and a toll-free
and TTY/TDY telephone number.
We are also proposing at Sec. 441.313(b) that CMS must report on
its CMS website the information reported by States to us under Sec.
441.311. For example, we envision that we will update CMS's website to
provide HCBS comparative information reported by States that can be
compared to HCBS information shared by other States. We also envision
using data from State reporting in future iterations of the CMS
Medicaid and CHIP Scorecard.\102\
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\102\ CMS's Medicaid and CHIP Scorecard. Accessed at https://www.medicaid.gov/state-overviews/scorecard/index.html.
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We are proposing at Sec. 441.313(c), to provide States with 3
years to implement these requirements in FFS delivery systems following
effective date of the final rule. For States with managed care delivery
systems under the authority of sections 1915(a), 1915(b), 1932(a), or
section 1115(a) of the Act and that include HCBS in the MCO's, PIHP's,
or PAHP's contract, we are proposing to provide States until the first
managed care plan contract rating period that begins on or after 3
years after the effective date of the final rule to implement these
requirements. This time period is based primarily on the effective date
for State reporting at Sec. 441.311. We also have considered all of
the HCBS proposals outlined in the proposed rule as whole. We invite
comments on whether this timeframe is sufficient, whether we should
require a longer timeframe (4 years) to implement these provisions, and
if a longer timeframe is recommended, the rationale for that longer
timeframe.
As discussed earlier in section II.B.1. of this preamble, section
2402(a)(3)(A) of the Affordable Care Act requires States to improve
coordination among, and the regulation of, all providers of Federally
and State-funded HCBS programs to achieve a more consistent
administration of policies and procedures across HCBS programs. In the
context of Medicaid coverage of HCBS, it should not matter whether the
services are covered directly on a FFS basis or by a managed care
entity to its enrollees. The requirement for ``consistent
administration'' should require consistency between these two modes of
service delivery. We accordingly are proposing to specify that a State
must ensure compliance with the requirements in Sec. 441.313, with
respect to HCBS delivered both under FFS and managed care delivery
systems.
Similarly, because we are proposing to apply the reporting
requirements at Sec. 441.311 to other HCBS State plan options, we are
proposing to incorporate these website transparency requirements within
the applicable regulatory sections. Specifically, we propose to apply
the proposed requirements of Sec. 441.313 to section 1915(j), (k), and
(i) State plan services by cross-referencing at Sec. Sec. 441.486,
441.595, and 441.750, respectively. Consistent with our proposal for
section 1915(c) waivers, we propose these requirements based on our
authority under section 1102(a) of the Act to make and publish rules
and regulations that are necessary for the efficient administration of
the Medicaid program. We believe the same arguments for proposing these
requirements for section 1915(c) waivers are equally applicable for
these other HCBS authorities. We request comment on the application of
these provisions across section 1915(i), (j), and (k) authorities.
10. Applicability of Proposed Requirements to Managed Care Delivery
Systems
As discussed earlier in sections II.B.1., II.B.4., II.B.5.,
II.B.7., and II.J. of this rule, we are proposing to apply the
requirements at Sec. Sec. 441.301(c)(3), 441.302(a)(6), 441.302(k),
441.311, and 441.313 to both FFS and managed care delivery systems.
Although the proposed provisions at Sec. Sec. 441.301(c)(3),
441.302(a)(6) and (k), 441.311, and 441.313 would apply to LTSS
programs that use a managed care delivery system to deliver services
authorized under section 1915(c) waivers and section 1915(i), (j), and
(k) State plan authorities, we believe incorporating a reference in 42
CFR part 438 would be helpful to States and managed care plans.
Therefore, we propose to add a cross reference to the requirements in
proposed Sec. 438.72 to be explicit that States that include HCBS in
their MCO, PIHP, or PAHP contracts would have to comply with the
requirements at Sec. Sec. 441.301(c)(1) through (3), 441.302(a)(6) and
(k), 441.311, and 441.313. We believe this would make the obligations
of States that implement LTSS programs through a managed care delivery
system clear, consistent, and easy to locate. While we believe the list
proposed in Sec. 438.72 would help States easily identify the
provisions related to LTSS, we identify that a provision specified in
any other section of 42 CFR part 438 or any other Federal regulation
but omitted from Sec. 438.72, is still in full force and effect. We
also note that Sec. 438.208(c)(3)(ii) currently includes a cross-
reference to Sec. 441.301(c)(1) and (2). We are not proposing any
changes to the regulatory language at Sec. 441.301(c)(1) or (2) or to
Sec. 438.208(c)(3)(ii) through this rule. We have included Sec.
441.301(c)(1) and (2) in the proposed regulatory language at Sec.
438.72 so that it is clear that the requirements at Sec. 441.301(c)(1)
and (2) continue to apply when States include HCBS in their MCO, PIHP,
or PAHP contracts.
C. Documentation of Access to Care and Service Payment Rates (Sec.
447.203)
Section 1902(a)(30)(A) of the Act requires that State plans
``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.'' Through the proposed provisions in Sec.
447.203, we seek to establish an updated process through which States
would be required to document, and we would ensure, compliance with the
requirements of section 1902(a)(30)(A) of the Act.
In the 2015 final rule with comment period, we codified a process
that requires States to complete and make public AMRPs that analyze and
inform determinations of the sufficiency of access to care (which may
vary by geographic location in the State) and are used to inform State
policies affecting access to Medicaid services, including provider
payment rates. The AMRP must specify data elements that support the
State's analysis of whether beneficiaries have sufficient access to
care, based on data, trends, and factors that measure beneficiary
needs, availability of care through enrolled providers, and utilization
of services. States are required to update their AMRPs at regular
intervals and whenever the State proposes to reduce FFS provider
payment rates or restructure them in circumstances when the changes
could result in diminished access. Specifically, the current AMRP
process at Sec. 447.203 requires States to consider the extent to
which beneficiary needs are fully met; the availability of
[[Page 27997]]
care through enrolled providers to beneficiaries in each geographic
area, by provider type and site of service; changes in beneficiary
utilization of covered services in each geographic area; the
characteristics of the beneficiary population (including considerations
for care, service and payment variations for pediatric and adult
populations and for individuals with disabilities); and actual or
estimated levels of provider payment available from other payers,
including other public and private payers, by provider type and site of
service. The analysis further requires consideration of beneficiary and
provider input, and an analysis of the percentage comparison of
Medicaid payment rates to other public and private health insurer
payment rates within geographic areas of the State, for each of the
services reviewed, by the provider types and sites of service. While
the current regulations do include broad requirements for what an
acceptable analysis methodology must include, States retain discretion
in establishing their processes, including but not limited to the
specification of data sources and analytical methodologies to be used.
The result is a large analytical burden on States without a
standardization that would allow us and other interested parties to
compare data between States to understand whether the Federal access
standards are successfully achieving robust access consistent with
section 1902(a)(30)(A) of the Act for beneficiaries nationwide.
Through AMRPs, we aimed to create a transparent and data-driven
process through which to ensure State compliance with section
1902(a)(30)(A) of the Act. Following publication of the 2011 proposed
rule and as discussed in both the 2015 final rule with comment period
and the 2016 final rule, as we worked with States to implement the AMRP
requirements, many States expressed numerous concerns about the
rule.103 104 105 States were concerned about the
administrative burden of completing the AMRPs and questioned whether
the AMRP process is the most effective way to establish that access to
care in a State's Medicaid program meets statutory requirements. States
with high managed care enrollment penetration were also concerned about
the AMRP process because the remaining FFS populations in their State
often reside in long-term care facilities or require only specialized
care that is carved out from managed care, but long-term care and
specialized care services were not required to be analyzed under the
AMRP process. We have also heard concerns from other interested
parties, including medical associations and non-profit organizations,
that the 2015 final rule with comment period afforded States too much
discretion in developing access measures which could lead to
ineffective monitoring and enforcement as well as challenges comparing
access across States. One commenter was concerned that States had too
much discretion in ``. . . setting standards and access measures . .
.'' and ``. . .whether they have met their chosen standards'' as this
process relies on self-regulation rather than ``an independent,
objective third party as the primary arbiter of a State's compliance .
. .'' \106\ Another commenter stated that ``CMS should designate a
limited and standardized set of data measures that would be collected
rather than leaving the decision of which data measures to use to State
discretion'' as this would ``enable the development of key, valid, and
uniform measures; more effective monitoring and enforcement; and will
ensure comparability of objective measures across the States.'' \107\
At the time of publication of the 2011 proposed rule and 2015 final
rule with comment period, we believed that a uniform approach to
meeting the statutory requirement under section 1902(a)(30)(A) of the
Act, including setting standardized access to care data measures, could
prove difficult given then-current limitations on data, local
variations in service delivery, beneficiary needs, and provider
practice roles.108 109
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\103\ 76 FR 26341.
\104\ 80 FR 67576 at 67583-67584.
\105\ 81 FR 21479 at 21479.
\106\ American Medical Association, Comment Letter on 2015 Final
Rule with Comment Period (January 4, 2016), https://www.regulations.gov/comment/CMS-2011-0062-0328.
\107\ American Association of Retired Persons, Comment Letter on
2011 Propose Rule (July 5, 2011), https://www.regulations.gov/comment/CMS-2011-0062-0121.
\108\ 76 FR 26341 at 26349.
\109\ 80 FR 67576 at 67577, 67579, 67590.
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Separately, the Supreme Court, in Armstrong v. Exceptional Child
Center, Inc., 135 S. Ct. 1378 (2015), ruled that Medicaid providers and
beneficiaries do not have a private right of action to challenge
Medicaid payment rates in Federal courts. This decision means provider
and beneficiary legal challenges are unavailable in Federal court to
supplement our oversight as a means of ensuring compliance with section
1902(a)(30)(A) of the Act. The Armstrong decision also underscored HHS'
and CMS' unique responsibility for resolving issues concerning the
interpretation and implementation of section 1902(a)(30)(A) of the Act.
By concluding that the responsible Federal administrative agency is
better suited than Federal courts to make determinations regarding the
sufficiency of Medicaid payment rates, the Supreme Court's Armstrong
decision placed added importance on CMS' administrative review of SPAs
proposing to reduce or restructure FFS payment rates. Accordingly, the
2015 final rule with comment period was an effort to establish a more
robust oversight and enforcement strategy with respect to section
1902(a)(30)(A) of the Act.
In consideration of State agencies' and other interested parties'
feedback on the AMRP process, as well as CMS' obligation to ensure
continued compliance with section 1902(a)(30)(A) of the Act, we propose
to update the requirements in Sec. 447.203. We propose to rescind and
replace the AMRP requirements currently in Sec. 447.203(b)(1) through
(8) with a streamlined and standardized process, described in proposed
Sec. 447.203(b) and (c). This proposed change is informed by a center-
wide review of our policy and processes regarding access to care for
all facets of the Medicaid program. The 2015 final rule with comment
period acknowledged our need to better understand FFS rate actions and
their potential impact on State programs, and the requirements we
finalized require a considerable amount of data from States. To ensure
States were meeting the statutory requirement under section
1902(a)(30)(A) of the Act, the AMRP process was originally intended to
establish a transparent data-driven process for States to measure the
current status of access to services within the State and utilize this
process for monitoring access when proposing rate reductions and
restructurings.\110\ As the rule took effect and as we reviewed State's
AMRPs, we found that some rate reductions and restructurings had much
smaller impacts than others. The 2017 SMDL reflected the experience
that certain payment rate changes would not likely result in diminished
access to care and do not require the substantial review of access data
that generally is required under the 2015 final rule with comment
period. Since publication of the 2019 CMCS Informational Bulletin
stating the agency's intention to establish a new access strategy, we
have developed this proposal for a new process that considers the
lessons learned under the AMRP process, and emphasizes transparency and
data
[[Page 27998]]
analysis, with specific proposed requirements varying depending on the
State's current payment levels relative to Medicare, the magnitude of
the proposed rate reduction or restructuring, and any access to care
concerns raised to State Medicaid agency by interested parties. With
these proposed provisions, we aim to balance Federal and State
administrative burden with our shared obligation to ensure compliance
with section 1902(a)(30)(A) of the Act (and our obligation to oversee
State compliance with the same).
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\110\ 80 FR 67576 at 67577.
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1. Fully Fee-For-Service States
We are seeking comment on whether additional access standards for
States with a fully FFS delivery system may be appropriate. Because the
timeliness standards of the proposed Medicaid and Children's Health
Insurance Program Managed Care Access, Finance, and Quality proposed
rule (Managed Care proposed rule) at Sec. 438.68 would not apply to
any care delivery in such States, we are considering whether a narrow
application of timeliness standards to fully FFS States that closely
mirrors the proposed appointment wait time standards, secret shopper
survey requirements, and publication requirements (as applied to
outpatient mental health and substance use disorder, adult and
pediatric; primary care, adult and pediatric; obstetrics and
gynecology; and an additional type of service determined by the State)
in that rule might be appropriate. Given that timeliness standards
would apply directly to States, we also seek comment on a potentially
appropriate method for CMS to collect data demonstrating that States
meet the established standards at least 90 percent of the time.
2. Payment Rate Transparency (Sec. 447.203(b))
We propose to rescind Sec. 447.203(b) in its entirety and replace
it with new requirements to ensure FFS Medicaid payment rate adequacy,
including a new process to promote payment rate transparency. This new
proposed process would require States to publish their FFS Medicaid
payment rates in a clearly accessible, public location on the State's
website, as described later in this section. Then, for certain
services, States would be required to conduct a comparative payment
rate analysis between the States' Medicaid payment rates and Medicare
rates, or provide a payment rate disclosure for certain HCBS that would
permit CMS to develop and publish HCBS payment benchmark data.
In paragraph (b)(1), we propose to require the State agency to
publish all Medicaid FFS payment rates on a website developed and
maintained by the single State agency that is accessible to the general
public. We propose that published Medicaid FFS payment rates would
include fee schedule payment rates made to providers delivering
Medicaid services to Medicaid beneficiaries through a FFS delivery
system. We also propose to require that the website be easily reached
from a hyperlink easily reached from a hyperlink on the State Medicaid
agency's website.
Within this payment rate publication, we propose that FFS Medicaid
payment rates must be organized in such a way that a member of the
public can readily determine the amount that Medicaid would pay for the
service and, in the case of a bundled or similar payment methodology,
identify each constituent service included within the rate and how much
of the bundled payment is allocated to each constituent service under
the State's methodology. We also propose that, if the rates vary, the
State must separately identify the Medicaid FFS payment rates by
population (pediatric and adult), provider type, and geographical
location, as applicable.
Longstanding legal requirements to provide effective communication
with individuals with disabilities and the obligation to take
reasonable steps to provide meaningful access to individuals with
limited English proficiency also apply to the State's website
containing Medicaid FFS payment rate information. Under Title II of the
Americans with Disabilities Act of 1990, section 504 of the
Rehabilitation Act, section 1557 of the Affordable Care Act, and
implementing regulations, qualified individuals with disabilities may
not be excluded from participation in, or denied the benefits of any
programs or activities of the covered entity, or otherwise be subjected
to discrimination by any covered entity, on the basis of disability,
and programs must be accessible to people with disabilities.\111\
Individuals with disabilities are entitled to communication that is as
effective as communication for people without disabilities, including
through the provision of auxiliary aids and services.\112\ Section 1557
of the Affordable Care Act requires recipients of Federal financial
assistance, including State Medicaid programs, to take reasonable steps
to provide meaningful access to their programs or activities for
individuals with limited English proficiency, and requires the
provision of interpreting services and translations when it is a
reasonable step to provide meaningful access.\113\
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\111\ 29 U.S.C. 794; 42 U.S.C. 18116(a); 42 U.S.C. 12132; 28
CFR. 35.130(a); 45 CFR 84.4(a); 45 CFR 92.2(b).
\112\ 28 CFR 35.160; 45 CFR 92.102; see also 45 CFR 84.52(d).
\113\ 45 CFR 92.101; see also https://www.hhs.gov/civil-rights/for-providers/laws-regulations-guidance/guidance-federal-financial-assistance-title-vi/index.html.
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We propose that for States that pay varying Medicaid FFS payment
rates by population (pediatric and adult), provider type, and
geographical location, as applicable, those States would need to
separately identify their Medicaid FFS payment rates in the payment
rate transparency publication by each grouping or multiple groupings,
when applicable to a State's program. In the event rates vary according
to these factors, as later discussed in this proposed rule, our intent
is that a member of the public be readily able to determine the payment
amount that would be made, accounting for all relevant circumstances.
For example, a State that varies their Medicaid FFS payment rates by
population may pay for a service identified by code 99202 when provided
to a child at a rate of $110.00 and when provided to an adult at a rate
of $80.00. Because the Medicaid FFS payment rates vary based on
population, both of these Medicaid FFS payment rates would need to be
included separately as Medicaid FFS payment rates for 99202 in the
State's payment rate transparency publication. As another example, a
State that varies their Medicaid FFS payment rates by provider type may
pay for 99202 when delivered by a physician at a rate of $50.00, and
when delivered by a nurse practitioner or physician assistant at a rate
of $45.00.
We are aware that some State plans include language that non-
physician practitioners (NPPs), such as a nurse practitioner or
physician assistant, are paid a percentage of the State's fee schedule
rate. Because the Medicaid FFS payment rates vary by provider type,
both of the Medicaid FFS payment rates in both situations (fee schedule
rates of $50.00 and $45.00) would need to be separately identified as
Medicaid FFS payment rates for 99202 in the State's payment rate
transparency publication, regardless of whether the State has
individually specified each amount certain in its approved payment
schedule or has State plan language specifying the nurse practitioner
or physician assistant rate as a percentage of the physician rate.
Additionally, for
[[Page 27999]]
example, a State that varies their Medicaid FFS payment rates by
geographical location may pay for 99202 delivered in a rural area at a
rate of $70, in an urban or non-rural area as a rate of $60, and in a
major metropolitan area as a rate of $50. We are also aware that States
may vary their Medicaid FFS payment rates by geographical location by
zip code, by metropolitan or micropolitan areas, or other geographical
location breakdowns determined by the State. Because the Medicaid FFS
payment rates vary based on geographical location, all Medicaid FFS
payment rates based on geographical location would need to be included
separately as Medicaid FFS payment rates for 99202 in the State's
payment rate transparency publication.
For a State that varies its Medicaid FFS payment rates by any
combination of these groupings, then the payment rate transparency
publication would be required to reflect these multiple groupings. For
example, the State would be required to separately identify the rate
for a physician billing 99202 provided to a child in a rural area, the
rate for a nurse practitioner billing 99202 provided to a child in a
rural area, the rate for a physician billing 99202 provided to an adult
in a rural area, the rate for a nurse practitioner billing 99202
provided to an adult in a rural area, the rate for a physician billing
99202 provided to a child in an urban area, the rate for a nurse
practitioner billing 99202 provided to a child in an urban area, and so
on. This information would be required to be presented clearly so that
a member of the public can readily determine the payment rate for a
service that would be paid for each grouping or combination of
groupings (population (pediatric and adult), provider type, and
geographical location), as applicable. We acknowledge that States may
also pay a single Statewide rate regardless of population (pediatric
and adult), provider type, and geographical location, and as such would
only need to list the single Statewide rate in their payment rate
transparency publication.
We acknowledge that there may be additional burden associated with
our proposal that the payment rate transparency publication include a
payment rate breakdown by population (pediatric and adult), provider
type, and geographical location, as applicable, when States' Medicaid
FFS payment rates vary based on these groupings. Despite the additional
burden, we believe that the additional level of granularity in the
payment rate transparency publication is important for ensuring
compliance with section 1902(a)(30)(A) of the Act, given State Medicaid
programs rely on multiple provider types to deliver similar services to
Medicaid beneficiaries of all ages, across multiple Medicaid benefit
categories, throughout each area of each State.
We further propose that Medicaid FFS payment rates published under
the proposed payment rate transparency requirement would only include
fee schedule payment rates made to providers delivering Medicaid
services to Medicaid beneficiaries through a FFS delivery system. To
ensure maximum transparency in the case of a bundled fee schedule
payment rate or rate determined by a similar payment methodology where
a single payment rate is used to pay for multiple services, we propose
that the State must identify each constituent service included in the
bundled fee schedule payment rate or rate determined by a similar
payment methodology. We also propose that the State must identify how
much of the bundled fee schedule payment rate or rate determined by a
similar payment methodology is allocated to each constituent service
under the State's payment methodology. For example, if a State's fee
schedule lists a bundled fee schedule rate that pays for day treatment
under the rehabilitation benefit and the following services are
included in the day treatment bundle: community based psychiatric
rehabilitation and support services, individual therapy, and group
therapy, then the State would need to identify services community based
psychiatric rehabilitation and support services, individual therapy,
and group therapy separately and each portion of the bundled fee
schedule payment rate for day treatment that is allocated to community
based psychiatric rehabilitation and support services, individual
therapy, and group therapy. Proposing to require States identify the
portion of the bundled fee is allocable to each constituent service
included in the bundled fee schedule payment rate would add an
additional level of granularity to the payment rate transparency
publication that continues to enable a member of the public to readily
be able to determine the payment amount that would be made for a
service, accounting for all relevant circumstances, including the
payment rates for each constituent service within a bundle and as a
standalone service. We also propose to require that the website be
easily reached from a hyperlink to ensure transparency of payment rate
information is available to beneficiaries, providers, CMS, and other
interested parties.
We propose the initial publication of Medicaid FFS payment rates
would occur no later than January 1, 2026, and include approved
Medicaid FFS payment rates in effect as of that date, January 1, 2026.
We propose this timeframe to provide States with at least 2 years from
the possible effective date of the final rule, if this proposal is
finalized, to comply with the payment rate transparency requirement.
The proposed timeframe would initially set a consistent baseline for
all States to first publish their payment rate transparency information
and then set a clear schedule for States to update their payment rates
based on the cadence of the individual States' payment rate changes.
The same initial publication due date for all States to publish
their payment rates as of January 1, 2026, would promote comparability
between States' payment rate transparency publications. Once States
would begin making updates to their payment rate transparency
publication, there would be a clear distinction between State payment
rates that have recently updated their payment rates and State payment
rates that have long maintained the same payment rates. For example,
two States initially publish their payment rates for 99202 at $50;
however, one State annually increases their payment rate by 5 percent
over the next 2 years and would update their payment rate transparency
publication in 2027 with a payment rate of $52.50, then in 2028 with a
payment rate of $55.13, while the other States' payment rate for the
same service remains at $50 in 2027 and 2028. The transparency of a
State's recent payment rates including the date the payment rates were
last updated on the State Medicaid agency's website, as discussed
later, as well as the ability to compare payment rates between States
on accessible and easily reachable State-maintained websites,
highlights how the proposed payment rate transparency would help to
ensure that Medicaid payment rate information is available to
beneficiaries, providers, CMS, and other interested parties for the
purposes of assessing access to care issues to better ensure compliance
with section 1902(a)(30)(A) of the Act.
We also propose that the initial publication include approved
Medicaid FFS payment rates in effect as of January 1, 2026. We propose
this language to narrow the scope of the publication to CMS-approved
payment rates and methodologies, thereby excluding any rate changes for
which a SPA or similar amendment request is
[[Page 28000]]
pending CMS review or approval. SPAs are submitted throughout the year,
can include retroactive effective dates, and are subject to a CMS
review period that varies in duration.114 115
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\114\ In accordance with 42 CFR 430.20, an approved SPA can be
effective no earlier than the first day of the calendar quarter in
which an approvable amendment is submitted. For example, a SPA
submitted on September 30th can be retroactively effective to July
1st.
\115\ In accordance with 42 CFR 430.16, a SPA will be considered
approved unless CMS, within 90 days after submission, requests
additional information or disapproves the SPA. When additional
information is requested by CMS and the State has respond to the
request, CMS will then have another 90 days to either approve,
disapprove, and request the State withdraw the SPA or the State's
response to the request for additional information. This review
period includes two 90-day review periods plus additional time when
CMS has requested additional information which can result is a wide
variety of approval timeframes.
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As discussed later in this proposed rule regarding paragraph (b)(2)
and(b)(3), States are encouraged to use the proposed payment rate
transparency publication as a source of Medicaid payment rate data for
compliance with the paragraph (b)(3)(i)(B) proposed comparative payment
rate analysis and paragraph (b)(3)(ii)(B) proposed payment rate
disclosure requirements. However, we note that the comparative payment
rate analysis and payment rate disclosure requirements impose a one-
year lag on the date when rates are effective. We include a more in-
depth discussion of the timeframes for publication of the comparative
payment rate analysis and payment rate disclosure in paragraph (b)(4)
later in this proposed rule, where we note that the 1-year shift in
timeframe is necessitated by the timing of when Medicare publishes
their payment rates in November and the rates taking effect on January
1, leaving insufficient time for CMS to publish the code list for
States to use for the comparative payment rate analysis and for States
develop and publish their comparative payment rate analysis and payment
rate disclosure by January 1. We note that the ongoing payment
transparency publication requirements will allow the public to view
readily available, current Medicaid payment rates at all times, even if
slightly older Medicaid payment rate information must be used for
comparative payment rate analyses due to the cadence of Medicare
payment rate changes as well as the payment rate disclosure. We are
cognizant that the payment rate disclosure does not depend on the
availability of Medicare payment rates, however, we are proposing to
provide States with the same amount of time to comply with both of the
proposed comparative payment rate analysis and payment rate disclosure
requirements.
If this proposal is finalized at a time that does not allow for
States to have a period of at least 2 years between the effective date
of the final rule and the proposed January 1, 2026, due date for the
initial publication of Medicaid FFS payment rates, then we would
propose an alternative date of July 1, 2026, for the initial
publication of Medicaid FFS payment rates and for the initial
publication to include approved Medicaid FFS payment rates as of that
date, July 1, 2026. This shift would allow more time for States to
comply with the payment rate transparency requirements. We acknowledge
that the date of the initial payment rate transparency publication is
subject to change based on the final rule publication schedule and
effective date, if this rule is finalized. If further adjustment is
necessary beyond the July 1, 2026, timeframe to allow adequate time for
States to comply with the payment rate transparency requirements, then
we would adjust date of the initial payment rate transparency
publication in 6-month intervals, as appropriate, to allow for
approximately 2 years between the effective date of the final rule and
the initial required payment rate transparency publication.
We propose to require the that the single State agency include the
date the payment rates were last updated on the State Medicaid agency's
website. We also propose to require that the single State agency ensure
that Medicaid FFS payment rates are kept current where any necessary
updates to the State fee schedules made no later than 1 month following
the date of CMS approval of the SPA, section 1915(c) HCBS waiver, or
similar amendment revising the provider payment rate or methodology.
Finally, in paragraph (b)(1), we propose that, in the event of a
payment rate change that occurs in accordance with a previously
approved rate methodology, the State would be required to update its
payment rate transparency publication no later than 1 month after the
effective date of the most recent update to the payment rate. This
provision is intended to capture Medicaid FFS payment rate changes that
occur because of previously approved SPAs containing payment rate
methodologies. For example, if a State sets their Medicaid payment
rates for Durable Medical Equipment, Prosthetics, Orthotics and
Supplies (DMEPOS) at a percentage of the most recent Medicare fee
schedule rate, then the State's payment rate would change when Medicare
adopts a new fee schedule rate through the quarterly publications of
the Medicare DMEPOS fee schedule, unless otherwise specified in the
approved State plan methodology that the State implements a specific
quarterly publication, for example, the most recent April Medicare
DMEPOS fee schedule. Therefore, the State's Medicaid FFS payment rate
automatically updates when Medicare publishes a new fee schedule,
without the submission of a SPA because the State's methodology pays a
percentage of the most recent State plan specified Medicare fee
schedule rate. In this example, the State would need to update its
Medicaid FFS payment rates in the payment rate transparency publication
no later than 1 month after the effective date of the most recent
update to the Medicare fee schedule payment rate made applicable under
the approved State plan payment methodology.
While there is no current Federal requirement for States to
consistently publish their rates in a publicly accessible manner, we
are aware that most States already publish at least some of their
payments through FFS rate schedules on State agency websites.
Currently, rate information may not be easily obtained from each
State's website in its current publication form, making it difficult to
understand the amounts that States pay providers for items and services
furnished to Medicaid beneficiaries and to compare Medicaid payment
rates to other health care payer rates or across States. However,
through this proposal we seek to ensure all States do so in a format
that is publicly accessible and where all Medicaid FFS payment rates
can be easily located and understood. The new transparency requirements
under this proposed rule would help to ensure that interested parties
have access to updated payment rate schedules and could conduct
analyses that would provide insights into how State Medicaid payment
rates compare to, for example, Medicare payment rates and other State
Medicaid payment rates. The proposal intends to help ensure that
payments are transparent and clearly understandable to beneficiaries,
providers, CMS, and other interested parties. We are seeking public
comment on the proposed requirement for States to publish their
Medicaid FFS payment rates for all services, the proposed structure for
Medicaid FFS payment rate transparency publication on the State's
website, and the timing of the publication of and updates to the
State's Medicaid FFS payment rates for the
[[Page 28001]]
proposed payment rate transparency requirements in Sec. 447.203(b)(1).
In paragraph (b)(2), we propose to require States to develop and
publish a comparative payment rate analysis of Medicaid payment rates
for certain specified services, and a payment rate disclosure for
certain HCBS. In paragraph (b)(2) we specify the categories of services
that States would be required to include in a comparative payment rate
analysis and payment rate disclosure of Medicaid payment rates.
Specifically, we are proposing that for each of the categories of
services in paragraphs (b)(2)(i) through (iii), each State agency would
be required to develop and publish a comparative payment rate analysis
of Medicaid payment rates as specified in proposed Sec. 447.203(b)(3).
We also propose that for each of the categories of services in
paragraph (b)(2)(iv), each State agency would be required to develop
and publish a payment rate disclosure of Medicaid payment rates as
specified in proposed Sec. 447.203(b)(3). We propose for both the
comparative payment rate analysis and payment rate disclosure that, if
the rates vary, the State must separately identify the payment rates by
population (pediatric and adult), provider type, and geographical
location, as applicable. The categories of services listed in paragraph
(b)(2) include: primary care services; obstetrical and gynecological
services; outpatient behavioral health services; and personal care,
home health aide, and homemaker services, as specified in Sec.
440.180(b)(2) through (4), provided by individual providers and
providers employed by an agency.
In paragraph (b)(2), we propose to require States separately
identify the payment rates in the comparative payment rate analysis and
payment rate disclosure, if the rates vary, by population (pediatric
and adult), provider type, and geographical location, as applicable.
These proposed breakdowns of the Medicaid payment rates, similar to how
we propose payment rates would be broken down in the payment rate
transparency disclosures under proposed Sec. 447.203(b)(1), would
apply to all proposed categories of services listed in paragraph
(b)(2): primary care services, obstetrical and gynecological services,
outpatient behavioral health services, and personal care, home health
aide, and homemaker services provided by individual providers and
providers employed by an agency.
We acknowledge that not all States pay varied payment rates by
population (pediatric and adult), provider type, and geographical
location, which is why we have included language ``if the rates vary''
and ``as applicable'' in the proposed regulatory text. This language is
included in the proposed regulatory text to ensure the comparative
payment rate analysis and payment rate disclosure captures all Medicaid
payment rates, including when States pay varied payment rates by
population (pediatric and adult), provider type, and geographical
location. We also included proposed regulatory text for the payment
rate disclosure that ensures the average hourly payment rates for
personal care, home health aide, and homemaker services provided by
individual providers and providers employed by an agency are separately
identified for payments made to individual providers and to providers
employed by an agency, if the rates vary, as later discussed in
connection with proposed Sec. 447.203(b)(3)(ii). For States that do
not pay varied payment rates by population (pediatric and adult),
provider type, and geographical location and pay a single Statewide
payment rate for a single service, then the comparative payment rate
analysis and payment rate disclosure would only need to include the
State's single Statewide payment rate.
We propose to include a breakdown of Medicaid payment rates by
population (pediatric and adult), provider type, and geographical
location, as applicable, on the Medicaid side of the comparative
payment rate analysis in paragraph (b)(2) to align with the proposed
payment rate transparency provision, to account for State Medicaid
programs that pay variable Medicaid payment rates by population
(pediatric and adult), provider type, and geographical location, and to
help ensure the State's comparative payment rate analyses accurately
align with Medicare. Following the initial year that the provisions
proposed in this rule would be in effect, these proposed provisions
would align with and build on the payment rate transparency
requirements described in Sec. 447.203(b)(1), because States could
source the codes and their corresponding Medicaid payment rates that
the State already would publish to meet the payment rate transparency
requirements.
These proposed provisions are also intended to help ensure that the
State's comparative payment rate analysis contains the highest level of
granularity in each proposed aspect by considering and accounting for
any variation in Medicaid payment rates by population (pediatric and
adult), provider type, and geographical location, as currently required
in the AMRP process under current Sec. 447.203(b)(1)(iv) and (v), and
(b)(3). Additionally, Medicare varies payment rates for certain NPPs
(nurse practitioners, physician assistants, and clinical nurse
specialists) by paying them 85 percent of the full Medicare physician
fee schedule amount and varies their payment rates by geographical
location through calculated adjustments to the pricing amounts to
reflect the variation in practice costs from one geographical location
to another; therefore, the comparative payment rate analysis accounting
for these payment rate variations is crucial to ensuring the Medicaid
FFS payment rates accurately align with FFS Medicare Physician Fee
Schedule (PFS) rates.\116\ As discussed later in this proposed rule,
Medicare payment variations for provider type and geographical location
would be directly compared with State Medicaid payment rates that also
apply the same payment variations, in addition to payment variation by
population (pediatric and adult) which is unique to Medicaid, yet an
important payment variation to take into consideration when striving
for transparency of Medicaid payment rates. For States that do not pay
varied payment rates by population (pediatric and adult), provider
type, or geographical location and pay a single Statewide payment rate
for a single service, Medicare payment variations for provider type and
geographical location would be considered by calculating a Statewide
average of Medicare PFS rates which is later discussed in this proposed
rule.
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\116\ https://www.medpac.gov/wp-content/uploads/2021/11/MedPAC_Payment_Basics_22_Physician_FINAL_SEC.pdf.
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Similar to the payment rate transparency publication, we
acknowledge that there may be additional burden associated with our
proposal that the payment rate transparency publication and the
comparative payment rate analysis include a payment rate breakdown by
population (pediatric and adult), provider type, and geographical
location, as applicable, when States' payment rates vary based on these
groupings. However, we believe that any approach to requiring a
comparative payment rate analysis would involve some level of burden
that is greater for States that choose to employ these payment rate
differentials, since any comparison methodology would need to take
account--through a separate comparison, weighted average, or other
mathematically reasonable approach--of all rates paid under the
Medicaid program for a given service. In all
[[Page 28002]]
events, we believe this proposal would create an additional level
granularity in the analysis that is important for ensuring compliance
with section 1902(a)(30)(A) of the Act. Multiple types of providers,
for example, physicians, physician assistants, and nurse practitioners,
are delivering similar services to Medicaid beneficiaries of all ages,
across multiple Medicaid benefit categories, throughout each State.
Section 1902(a)(30)(A) states ``. . . 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,'' and we believe that having
sufficient access to a variety of provider types is important to
ensuring access for Medicaid beneficiaries meets this statutory
standard. For example, a targeted payment rate reduction to nurse
practitioners, who are often paid less than 100 percent of the State's
physician fee schedule rate, could have a negative impact on access to
care for services provided by nurse practitioners, but this reduction
would not directly impact physicians or their willingness to
participate in Medicaid and furnish services to beneficiaries. By
proposing that the comparative payment rate analysis include a
breakdown by provider type, where States distinguish payment rates for
a service by provider type, the analysis would capture this payment
rate variation among providers of the same services and provide us with
a granular level of information to aid in determining if access to care
is sufficient, particularly in cases where beneficiaries depend to a
large extent on the particular provider type(s) that would be affected
by the proposed rate change for the covered service(s).
We identified payment rate variation by population (pediatric and
adult), provider type, and geographical location as the most commonly
applied adjustments to payment rates that overlap between FFS Medicaid
and Medicare and could be readily broken down into separately
identified payment rates for comparison in the comparative payment rate
analysis. For transparency purposes and to help to ensure the
comparative payment rate analysis is conducted at a granular level of
analysis, we believe it is important for the State to separately
identify their rates, if the rates vary, by population (pediatric and
adult), provider type, and geographical location, as applicable. We are
seeking public comments on the proposal to require the comparative
payment rate analysis includes, if the rates vary, separate
identification of payment rates by population (pediatric and adult),
provider type, and geographical location, as applicable, in the
comparative payment rate analysis in proposed Sec. 447.203(b)(2).
We acknowledge that States may apply additional payment adjustments
or factors, for example, the Consumer Price Index, Medicare Economic
Index, or State-determined inflationary factors or budget neutrality
factors, to their Medicaid payment rates other than population
(pediatric and adult), provider type, and geographical location
identified in this proposed rule. We would expect any other additional
payment adjustments and factors to already be included in the State's
published Medicaid fee schedule rate or calculable from the State plan
because Sec. 430.10 requires the State plan to be a ``comprehensive
written statement . . . contain[ing] all information necessary for CMS
to determine whether the plan can be approved to serve as a basis for .
. . FFP . . .'' Therefore, for States paying for services with a fee
schedule payment rate, the Medicaid fee schedule is the sole source of
information for providers to locate their final payment rate for
Medicaid services provide to Medicaid beneficiaries under a FFS
delivery system. For States with a rate-setting methodology where the
approved State plan describes how rates are set based upon a fee
schedule (for example, payment for NPPs are set a percentage of a
certain published Medicaid fee schedule), the Medicaid fee schedule
would again be the source of information for providers to identify the
relevant starting payment rate and apply the rate-setting methodology
described in the State plan to ascertain their Medicaid payment.\117\
We are also seeking public comment on any additional types of payment
adjustments or factors States make to their Medicaid payment rates as
listed on their State fee schedules that should be identified in the
comparative payment rate analysis that we have not already discussed in
Sec. 447.203(b)(i)(B) of this proposed rule, and how the inclusion of
any such additional adjustments or factors should be considered in the
development of the Medicare PFS rate to compare Medicaid payment rates
to, as later described in Sec. 447.203(b)(3)(i)(C), of this proposed
rule.
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\117\ https://www.medicaid.gov/state-resource-center/downloads/spa-and-1915-waiver-processing/fed-req-pymt-methodologies.docx.
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In paragraphs (b)(2)(i) through (iv), we propose that primary care
services, obstetrical and gynecological services, and outpatient
behavioral health services would be subject to a comparative payment
rate analysis of Medicaid payment rates and personal care, home health
aide, and homemaker services provided by individual providers and
providers employed by an agency would be subject to a payment rate
disclosure of Medicaid payment rates. We begin with a discussion about
the importance of primary care services, obstetrical and gynecological
services, and outpatient behavioral health services as proposed in
Sec. 447.203(b)(2)(i) through (iii), and the reason for their
inclusion in this proposed requirement. Then, we will discuss the
importance and justification for including personal care, home health
aide, and homemaker services provided by individual providers and
providers employed by an agency as proposed in Sec. 447.203(b)(2)(iv).
In Sec. 447.203(b)(2)(i) through (iii), we propose to require
primary care services, obstetrical and gynecological services, and
outpatient behavioral health services be included in the comparative
payment rate analysis, because we believe that these categories of
services are critical preventive, routine, and acute medical services
in and of themselves, and that they often serve as gateways to access
to other needed medical services, including specialist services,
laboratory and x-ray services, prescription drugs, and other mandatory
and optional Medicaid benefits that States cover. Including these
categories of services in the comparative payment rate analysis would
require States to closely examine their Medicaid FFS payment rates to
comply with section 1902(a)(30)(A) of the Act. As described in the
recent key findings from public comments on the February 2022 RFI that
we published, payment rates are a key driver of provider participation
in the Medicaid program.\118\ By proposing that States compare their
Medicaid payment rates for primary care services, obstetrical and
gynecological services, and outpatient behavioral health services to
Medicare payment rates, States would be required to analyze if and how
their 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
[[Page 28003]]
services are available to the general population in the geographic
area.
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\118\ Summary of Public Comments in response to the CMS 2022
Request for Information: Access to Coverage and Care in Medicaid &
CHIP. December 2022. For the report, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-report.pdf.
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As discussed later in this section, we believe that Medicare
payment rates for these services are likely to serve as a reliable
benchmark for a level of payment sufficient to enlist providers to
furnish the relevant services to a beneficiary because Medicare
delivers services through a FFS delivery system across all geographical
regions of the US and historically, the vast majority of physicians
accept new Medicare patients, with extremely low rates of physicians
opting out of the Medicare program, suggesting that Medicare's payment
rates are generally consistent with a high level of physician
willingness to accept new Medicare patients.\119\ Additionally,
Medicare payment rates are publicly published in an accessible and
consistent format by CMS making Medicare payment rates an available and
reliable comparison point for States, rather than private payer data
which typically is considered proprietary information and not generally
available to the public. Therefore, the proposed requirement that
States develop and publish a comparative payment rate analysis would
enable States, CMS, and other interested parties to closely examine the
relationship between State Medicaid FFS payment rates and those paid by
Medicare. This analysis would continually help States to ensure that
their Medicaid payment rates are set at a level that is likely
sufficient to meet the statutory access standard under 1902(a)(30)(A)
of the Act that payments by enlisting 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. We believe that the comparative payment rate analysis
would provide States, CMS, and other interested parties with clear and
concise information for identifying when there is a potential access to
care issue, such as Medicaid payment rates not keeping pace with
changes in corresponding Medicare rates and decreases in claims volume
and beneficiary utilization of services. As discussed later in this
section, numerous studies have found a relationship between Medicaid
payment rates and provider participation in the Medicaid program and,
given the statutory standard of ensuring access for Medicaid
beneficiaries, a comparison of Medicaid payment rates to other payer
rates, particularly Medicare payment rates as justified later in this
rule, is an important barometer of whether State payment rates and
policies are sufficient for meeting the statutory access standard under
section 1902(a)(30)(A) of the Act.
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\119\ Physicians and practitioners who do not wish to enroll in
the Medicare program may ``opt-out'' of Medicare. This means that
neither the physician, nor the beneficiary submits the bill to
Medicare for services rendered. Instead, the beneficiary pays the
physician out-of-pocket and neither party is reimbursed by Medicare.
A private contract is signed between the physician and the
beneficiary that states, that neither one can receive payment from
Medicare for the services that were performed. See https://data.cms.gov/provider-characteristics/medicare-provider-supplier-enrollment/opt-out-affidavits.
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We propose to focus on these particular services because they are
critical medical services and of great importance to overall
beneficiary health. Beginning with primary care, these services provide
access to preventative services and facilitate the development of
crucial doctor-patient relationships. Primary care providers often
deliver preventative health care services, including immunizations,
screenings for common chronic and infectious diseases and cancers,
clinical and behavioral interventions to manage chronic disease and
reduce associated risks, and counseling to support healthy living and
self-management of chronic diseases; Medicaid coverage of preventative
health care services promotes disease prevention which is critical to
helping people live longer, healthier lives.\120\ Accessing primary
care services can often result in beneficiaries receiving referrals or
recommendations to schedule an appointment with physician specialists,
such as gastroenterologists or neurologists, that they would not be
able to obtain without the referral or recommendation by the primary
care physician. Additionally, primary care physicians provide
beneficiaries with orders for laboratory and x-ray services as well as
prescriptions for necessary medications that a beneficiary would not be
able to access without the primary care physician. Research over the
last century has shown that the impact of the doctor-patient
relationship on patient's health care experience, health outcomes, and
health care costs exists \121\ and more recent studies have shown that
the quality of the physician-patient relationship is positively
associated with functional health among patients.\122\ Another study
found that higher primary care payment rates reduced mental illness and
substance use disorders among non-elderly adult Medicaid enrollees,
suggesting that positive spillover from increasing primary care rates
also positively impacted behavioral health outcomes.\123\ Lastly,
research has shown that a reduction in barriers to accessing primary
care services has been associated with helping reduce health
disparities and the risk of poor health outcomes. 124 125
These examples illustrate how crucial access to primary care services
is for overall beneficiary health and to enable access to other medical
services. We are seeking public comment on primary care services as one
of the proposed categories of services subject to the comparative
payment rate analysis requirements in proposed Sec. 447.203(b)(2)(i).
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\120\ https://www.medicaid.gov/medicaid/benefits/prevention/index.html.
\121\ Cockerham, W.C. (2021). The Wiley Blackwell Companion to
Medical Sociology (1st ed.). John Wiley & Sons.
\122\ Olaisen, R.H., Schluchter, M.D., Flocke, S.A., Smyth,
K.A., Koroukian, S.M., & Stange, K.C. (2020). Assessing the
longitudinal impact of physician-patient relationship on Functional
Health. The Annals of Family Medicine, 18(5), 422-429. https://doi.org/10.1370/afm.2554.
\123\ Maclean, Johanna Catherine, McCleallan, Chandler, Pesko,
Michael F., and Polsky, Daniel. (2023). Medicaid reimbursement rates
for primary care services and behavioral health outcomes. Health
economics, 1-37. https://doi.org/10.1002/hec.4646.
\124\ Starfield, B., Shi, L., & Macinko, J. (2005). Contribution
of primary care to health systems and health. The Milbank quarterly,
83(3), 457-502. https://doi.org/10.1111/j.1468-0009.2005.00409.x.
\125\ https://health.gov/healthypeople/priority-areas/social-determinants-health/literature-summaries/access-primary-care.
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Similar to primary care services, both obstetrical and
gynecological services and outpatient behavioral health services
provide access to preventative and screening services unique to each
respective field. A well-woman visit to an obstetrician-gynecologist
often provides access to screenings for cervical and breast cancer;
screenings for Rh(D) incompatibility, syphilis infection, and hepatitis
B virus infection in pregnant persons; monitoring for healthy weight
and weight gain in pregnancy; immunization against the human
papillomavirus infection; and perinatal depression screenings among
other recommended preventive services.126 127 Behavioral
health care
[[Page 28004]]
promotes mental health, resilience, and wellbeing; the treatment of
mental and substance use disorders; and the support of those who
experience and/or are in recovery from these conditions, along with
their families and communities. Outpatient behavioral health services
can overlap with preventative primary care and obstetrical and
gynecological services, for example screening for depression in adults
and perinatal depression screenings, but also provide unique
preventative and screening services such as screenings for unhealthy
alcohol use in adolescents and adults, anxiety in children and
adolescents, and eating disorders in adolescents and adults, among
other recommended preventive services.\128\
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\126\ Rh(D) incompatibility is a preventable pregnancy
compilation where a woman who is Rh negative is carrying a fetus
that is Rh positive (Rh factor is a protein that can be found on the
surface of red blood cells). When the blood of an Rh-positive fetus
gets into the bloodstream of an Rh-negative woman, her body will
recognize that the Rh-positive blood is not hers. Her body will try
to destroy it by making anti-Rh antibodies. These antibodies can
cross the placenta and attack the fetus's blood cells. This can lead
to serious health problems, even death, for a fetus or a newborn.
Prevention of Rh(D) incompatibility screening for Rh negative early
in pregnancy (or before pregnancy) and, if needed, giving you a
medication to prevent antibodies from forming.
\127\ https://www.acog.org/clinical/clinical-guidance/committee-opinion/articles/2018/10/well-woman-visit.
\128\ https://www.uspreventiveservicestaskforce.org/uspstf/topic_search_results?topic_status=P.
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The U.S. is simultaneously experiencing a maternal health crisis
and mental health crisis, putting providers of obstetrical and
gynecological and outpatient behavioral health services, respectively,
at the forefront.129 130 According to MACPAC, ``Medicaid
plays a key role in providing maternity-related services for pregnant
women, paying for slightly less than half of all births nationally in
2018.'' \131\ Given Medicaid's significant role in maternal health
during a time when maternal mortality rates in the United States
continue to worsen and the racial disparities among mothers continues
to widen,132 133 accessing obstetrical and gynecological
care, including care before, during, and after pregnancy is crucial to
positive maternal and infant outcomes.\134\ We are seeking public
comment on obstetrical and gynecological services as one of the
proposed categories of services subject to the comparative payment rate
analysis requirements in proposed Sec. 447.203(b)(2)(ii).
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\129\ https://www.whitehouse.gov/wp-content/uploads/2022/06/Maternal-Health-Blueprint.pdf.
\130\ https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/31/fact-sheet-biden-harris-administration-highlights-strategy-to-address-the-national-mental-health-crisis/.
\131\ https://www.macpac.gov/wp-content/uploads/2020/01/Medicaid%E2%80%99s-Role-in-Financing-Maternity-Care.pdf.
\132\ https://www.cdc.gov/nchs/data/hestat/maternal-mortality/2020/maternal-mortality-rates-2020.htm.
\133\ https://www.nytimes.com/2022/02/23/health/maternal-deaths-pandemic.html?smid=url-share.
\134\ https://www.cms.gov/About-CMS/Agency-Information/OMH/equity-initiatives/rural-health/09032019-Maternal-Health-Care-in-Rural-Communities.pdf.
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Improving access to behavioral health services is a critical,
national issue facing all payors, particularly for Medicaid which plays
a crucial role in mental health care access as the single largest payer
of services and has a growing role in payment for substance use
disorder services, in part due to Medicaid expansion and various
efforts by Congress to improve access to mental health and substance
use disorder services.135 136 Several studies have found an
association between reducing the uninsured rate through increased
Medicaid enrollment and improved and expanded access to critically
needed behavioral health services.\137\ Numerous studies have found
positive outcomes associated with Medicaid expansion: increases in the
insured rate and access to care and medications for adults with
depression, increases in coverage rates and a greater likelihood of
being diagnosed with a mental health condition as well as the use of
prescription medications for a mental health condition for college
students from disadvantaged backgrounds,\138\ and a decrease in delayed
or forgone necessary care in a nationally representative sample of non-
elderly adults with serious psychological distress.\139\ While
individuals who are covered by Medicaid have better access to
behavioral health services compared to people who are uninsured, some
coverage gaps remain in access to behavioral health care for many
people, including those with Medicaid.
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\135\ https://www.medicaid.gov/medicaid/access-care/downloads/coverage-and-behavioral-health-data-spotlight.pdf.
\136\ https://www.medicaid.gov/medicaid/benefits/behavioral-health-services/index.html.
\137\ https://www.cbpp.org/research/health/to-improve-behavioral-health-start-by-closing-the-medicaid-coverage-gap.
\138\ Cowan, Benjamin W. & Hao, Zhuang. (2021). Medicaid
expansion and the mental health of college students. Health
economics, 30(6), 1306-1327. https://www.nber.org/system/files/working_papers/w27306/w27306.pdf.
\139\ Novak, P., Anderson, A. C., & Chen, J. (2018). Changes in
Health Insurance Coverage and Barriers to Health Care Access Among
Individuals with Serious Psychological Distress Following the
Affordable Care Act. Administration and policy in mental health,
45(6), 924-932. https://doi.org/10.1007/s10488-018-0875-9.
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Some of the barriers to accessing behavioral health treatment in
Medicaid reflect larger system-wide access problems: overall shortage
of behavioral health providers in the United States and relatively
small number of psychiatrists who accept any form of insurance or
participate in health coverage programs.\140\ Particularly for
outpatient behavioral health services for Medicaid beneficiaries, one
reason physicians are unwilling to accept Medicaid patients is because
of low Medicaid payment rates.\141\ One study found evidence of low
Medicaid payment rates by examining outpatient Medicaid claims data
from 2014 in 11 States with a primary behavioral health diagnosis and
an evaluation and management (E/M) procedure code of 99213 (Established
patient office visit, 20-29 minutes) or 99214 (Established patient
office visit, 30-39 minutes) and found that psychiatrists in nine
States were paid less, on average, than primary care physicians.\142\
These pieces of research and data about the importance of outpatient
behavioral health services and the existing challenges beneficiaries
face in trying to access outpatient behavioral health services
underscore how crucial access to outpatient behavioral health services
is, and that adequate Medicaid payment rates for these services is
likely to be an important driver of access for beneficiaries. We are
seeking public comment on outpatient behavioral health services as one
of the proposed categories of services subject to the comparative
payment rate analysis requirements in proposed Sec.
447.203(b)(2)(iii).
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\140\ https://www.kff.org/medicaid/issue-brief/medicaids-role-in-financing-behavioral-health-services-for-low-income-individuals/.
\141\ https://www.healthaffairs.org/do/10.1377/forefront.20190401.678690/full/.
\142\ Mark, Tami L., Parish, William, Zarkin, Gary A., and
Weber, Ellen. (2020). Comparison of Medicaid Reimbursements for
Psychiatrists and Primary Care Physicians. Psychiatry services
71(9), 947-950. https://doi.org/10.1176/appi.ps.202000062.
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In Sec. 447.203(b)(2)(iv), we propose to require personal care,
home health aide, and homemaker services provided by individual
providers and providers employed by an agency in the payment rate
disclosure requirements proposed in Sec. 447.203(b)(3)(ii). We are
cognizant that many HCBS providers nationwide are facing workforce
shortages and high staff turnover that have been exacerbated by the
COVID-19 pandemic, and these issues and related difficulty accessing
HCBS can lead to higher rates of costly, institutional stays for
beneficiaries.\143\ As with any covered service, the supply of HCBS
providers has a direct and immediate impact on beneficiaries' ability
to access high quality HCBS, therefore, we included special
considerations for LTSS, specifically HCBS, through two proposed
provisions in Sec. 447.203. The first provision in proposed paragraph
[[Page 28005]]
(b)(2)(iv) would require States to include personal care, home health
aide, and homemaker services provided by individual providers and
providers employed by an agency to be included in the payment rate
disclosure in proposed paragraph (b)(3)(ii). The second provision in
paragraph (b)(6), discussed in the next section, would require States
to establish an interested parties' advisory committee to advise and
consult on rates paid to certain HCBS providers. This provision is
intended to help contextualize lived experience of direct care workers
and beneficiaries who receive the services they deliver by providing
direct care workers, beneficiaries and their authorized
representatives, and other interested parties with the ability to make
to recommendations to the Medicaid agency regarding the sufficiency of
Medicaid payment rates for these specified services to help ensure
sufficient provider participation so that these HCBS are accessible to
beneficiaries consistent with section 1902(a)(30)(A) of the Act.
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\143\ https://www.kff.org/coronavirus-covid-19/event/march-30-web-event-unsung-heroes-the-crucial-role-and-tenuous-circumstances-of-home-health-aides-during-the-pandemic/; https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
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The proposed payment rate disclosure would require States to
publish the average hourly payment rates made to individual providers
and to providers employed by an agency, separately, if the rates vary,
for each category of services specified in paragraph (b)(2)(iv) of this
section. No comparison to Medicare payment rates would be required in
recognition that Medicare generally does not cover and pay for these
services, and when these services are covered and paid for by Medicare,
the services are very limited and provided on a short-term basis,
rather than long-term basis as with Medicaid HCBS. While Medicare
covers part-time or intermittent home health aide services (only if a
Medicare beneficiary is also getting other skilled services like
nursing and/or therapy at the same time) under Medicare Part A
(Hospital Insurance) or Medicare Part B (Medical Insurance), Medicare
does not cover personal care or homemaker services.\144\
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\144\ https://www.medicare.gov/coverage/home-health-services.
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We propose to require these services be subject to a payment rate
disclosure because this proposed rule aims to standardize data and
monitoring across service delivery systems with the goal of improving
access to care. To remain consistent with the proposed HCBS provisions
at Sec. 441.311(d)(2) and (e), where we propose to require annual
State reporting on access and payment adequacy metrics for homemaker,
home health aide, and personal care services, we are proposing to
include these services, provided by individual providers and providers
employed by an agency in the FFS payment rate disclosure proposed in
Sec. 447.203(b)(2). As described earlier in the HCBS provisions of
this rule, these specific services were chosen because we expect them
to be most commonly conducted in individuals' homes and general
community settings and, therefore, constitute the vast majority of FFS
payments for direct care workers delivering services under FFS. We
acknowledge that the proposed analyses required of States in the HCBS
provisions at Sec. 441.311(d)(2) and (e) and in the FFS provisions at
Sec. 447.203(b)(2) are different, although, unique to assessing access
in each program and delivery system. We are proposing to include
personal care, home health aide, and homemaker services for consistency
with HCBS access and payment adequacy provisions in this proposed rule,
and also to include these services in the proposed provisions of Sec.
447.203(b)(2) to require States to conduct and publish a payment rate
disclosure. We believe the latter proposal is important because the
payment rate disclosure of personal care, home health aide, and
homemaker services would provide CMS with sufficient information,
including average hourly payment rates, claims volume, and number of
Medicaid enrolled beneficiaries who received a service as specified in
proposed Sec. 447.203(b)(3)(ii), from States for ensuring compliance
with section 1902(a)(30)(A) of the Act, which requires that payments be
consistent with efficiency, economy, and quality of care and 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.
Additionally, this proposal to include personal care, home health aide,
and homemaker services provided by individual providers and providers
employed by an agency is supported by the statutory mandate at section
2402(a) of the Affordable Care Act. Among other things, section 2402(a)
of the Affordable Care Act directs the Secretary to promulgate
regulations ensuring that all States develop service systems that
ensure that there is an adequate number of qualified direct care
workers to provide self-directed services. We are seeking public
comment on personal care, home health aide, and homemaker services
provided by individual providers and providers employed by an agency as
the proposed categories of services subject to the payment rate
disclosure requirements in proposed Sec. 447.203(b)(2)(iv).
After discussing our proposed categories of services for the
comparative payment rate analysis and payment rate disclosure
requirements, we discuss the similarities and differences between the
proposed rule and services currently included in the existing AMRP
requirements. While this proposed rule would eliminate the triennial
AMRP process, there are some similarities between the service
categories for which we are proposing to require a comparative payment
rate analysis or payment rate disclosure in Sec. 447.203(b)(2) and
those subject to the current AMRP requirements under Sec.
447.203(b)(5)(ii). Specifically, Sec. 447.203(b)(5)(ii)(A) currently
requires the State agency to use data collected through the AMRP to
provide a separate analysis for each provider type and site of service
for primary care services (including those provided by a physician,
FQHC, clinic, or dental care). We are proposing the comparative payment
rate analysis include primary care services, without any parenthetical
description. We believe this is appropriate because the proposed rule
includes a comparative payment rate analysis that is at the Current
Procedural Terminology (CPT) or Healthcare Common Procedure Coding
System (HCPCS) code level, as applicable, the specifics for which are
discussed later in this section. This approach requires States to
perform less sub-categorization of the data analysis, and as discussed
later the analysis, would exclude FQHCs and clinics.
The current AMRP process also includes in Sec.
447.203(b)(5)(ii)(C) behavioral health services (including mental
health and substance use disorder); however, this proposed rule
specifies that the comparative payment rate analysis only would include
outpatient behavioral health services to narrow the scope of the
analysis by excluding inpatient behavioral health services (including
inpatient behavioral health services furnished in psychiatric
residential treatment facilities, institutions for mental diseases, and
psychiatric hospitals). While we acknowledge that behavioral health
services encompass a broad range of services provided in a wide variety
of settings, from outpatient screenings in a physician's office to
inpatient hospital treatment, we are proposing to narrow the scope of
behavioral health services to just outpatient services to focus the
comparative payment rate analysis on ambulatory care provided by
practitioners in an office-based setting without duplicating existing
[[Page 28006]]
requirements, or analysis that must be completed to satisfy existing
requirements, for upper payment limits (UPL) and the supplemental
payment reporting requirements under section 1903(bb) of the Act, as
established by Division CC, Title II, Section 202 (section 202) of the
Consolidated Appropriations Act, 2021 (CAA) (Public Law 116-260).
The proposed categories of services in this rule are delivered as
ambulatory care where the patient does not need to be hospitalized to
receive the service being delivered. Particularly for behavioral health
services, we propose to narrow the scope to outpatient behavioral
health services to maintain consistency within the categories of
service included in the proposed comparative payment rate analysis and
payment rate disclosure all being classified as ambulatory care.
Additionally, as discussed further in this section of the proposed
rule, we proposed that the comparative payment rate analysis would be
conducted on a CPT/HCPCS code level, focusing on E/M codes. By
narrowing the comparative payment rate analysis to E/M CPT/HCPCS codes,
we are proposing States' analyses includes a broad range of core
services which would cover a variety of commonly provided services that
fall into the categories of service proposed in paragraphs (b)(2)(i)
through (iii). To balance State administrative burden with our
oversight of State compliance with the access requirement in section
1902(a)(30)(A) of the Act, we are also proposing to limit the services
to those delivered primarily by physicians and NPPs in an office-based
setting for primary care, obstetrical and gynecological, and outpatient
behavioral health services. By excluding facility-based services,
particularly inpatient behavioral health services, we intend to ensure
the same E/M CPT/HCPCS code-level methodology could be used for all
categories of services included in the proposed comparative payment
rate analysis, including the use of E/M CPT/HCPCS codes used for
outpatient behavioral health services. Rather than fee schedule rates,
States often pay for inpatient behavioral health services using
prospective payment rate methodologies, such as Diagnosis Related
Groups (DRGs), or interim payment methodologies that are reconciled to
actual cost.\145\ These methodologies pay for a variety of services
delivered by multiple providers that a patient receives during an
inpatient hospital stay, rather than a single ambulatory service billed
by a single provider using a single CPT/HCPCS code. Variations in these
payment methodologies and what is included in the rate could complicate
the proposed comparison to FFS Medicare rates for the services
identified in paragraphs (b)(2)(i) through (iii) and could frustrate
comparisons between States and sometimes even within a single State.
Therefore, we do not believe the E/M CPT/HCPCS code level methodology
proposed for the comparative payment rate analysis would be feasible
for inpatient behavioral health services or other inpatient and
facility-based services in general.
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\145\ https://www.cms.gov/icd10m/version37-fullcode-cms/fullcode_cms/Design_and_development_of_the_Diagnosis_Related_Group_(DRGs).pdf.
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While we considered including inpatient behavioral health services
as one of the proposed categories of services in the comparative
payment rate analysis, we ultimately did not because we already collect
and review Medicaid and Medicare payment rate data for inpatient
behavioral health services through annual upper payment limits
demonstrations (UPL) and supplemental payment reporting requirements
under section 1903(bb) of the Act. SMDL 13-003 discusses the annual
submission of State UPL demonstrations for inpatient hospital services,
among other services, including a complete data set of payments to
Medicaid providers and a reasonable estimate of what Medicare would
have paid for the same services.146 147 UPL requirements go
beyond the proposed requirements in this rule by requiring States to
annually submit the following data for all inpatient hospital services,
depending on the State's UPL methodology, on a provider level basis:
Medicaid charges, Medicaid base payments, Medicaid supplemental
payments, Medicaid discharges, Medicaid case mix index, Medicaid
inflation factors, other adjustments to Medicaid payments, Medicaid
days, Medicare costs, Medicare payments, Medicare discharges, Medicare
case mix index, Medicare days, UPL inflation factors, Medicaid provider
tax cost, and other adjustments to the UPL amount. If we proposed
inpatient behavioral health services as one of the categories of
services subject to the comparative payment rate analysis, then this
proposed rule would require States to biennially submit the following
data for only inpatient behavioral health services on a CPT/HCPCS code
level basis: Medicaid base payment rates for select E/M CPT/HCPCS codes
(accounting for rate variation based on population (pediatric and
adult), provider type, and geographical location, as applicable), the
corresponding Medicare payment rates, Medicaid base payment rate as a
percentage of Medicare payment rate, and the number of Medicaid-paid
claims. While the UPL requires aggregated total payment and cost data
at the provider level and the comparative payment rate analysis would
require more granular base payment data at the CPT/HCPCS code level,
the UPL overall requires aggregate Medicaid provider payment data for
both base and supplemental payments as well as more detailed data for
calculating what Medicare would have paid as the upper payment amount.
Therefore, proposing to require States include Medicaid and Medicare
payment rate data for inpatient behavioral health services in the
comparative payment rate analysis would be duplicative of existing UPL
requirements that are inclusive of and more comprehensive than the
payment information proposed in the comparative payment rate analysis.
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\146\ https://www.medicaid.gov/sites/default/files/Federal-Policy-Guidance/Downloads/SMD-13-003-02.pdf.
\147\ If a State's payment methodology describes payment at no
more than 100 percent of the Medicare rate for the period covered by
the UPL, then the State does not need to submit a demonstration. See
FAQ ID: 92201. https://www.medicaid.gov/faq/index.html?search_api_fulltext=ID%3A92201&sort_by=field_faq_date&sort_order=DESC.
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Additionally, section 1903(bb) of the Act requires us to establish
a Medicaid supplemental payment reporting system that collects detailed
information on State Medicaid supplemental payments, including total
quarterly supplemental payment expenditures per provider; information
on base payments made to providers that have received a supplemental
payment; and narrative information describing the methodology used to
calculate a provider's payment, criteria used to determine which
providers qualifies to receive a payment, and explanation describing
how the supplemental payments comply with section 1902(a)(30)(A) of the
Act. Section 1903(bb)(1)(C) of the Act requires us to make State-
reported supplemental payment information publicly available. For
States making or wishing to make supplemental payments, including for
inpatient behavioral health services, States must report supplemental
payment information to us and we must make that information public and,
therefore, transparent. Though this proposed rule seeks to increase
transparency, with the
[[Page 28007]]
proposed provisions under Sec. 447.203(b)(1) through (5) focusing on
transparency of FFS Medicaid base payment rates, including inpatient
behavioral health services as a category of service in Sec.
447.203(b)(2) subject to the comparative payment rate analysis would be
duplicative of the existing upper payment limit and supplemental
payment reporting requirements, which capture and make transparent base
and supplemental payment information for inpatient behavioral health
services. However, we are seeking public comment regarding our decision
not to include inpatient behavioral health services as one of the
categories of services subject to the comparative payment rate analysis
requirements in proposed Sec. 447.203(b)(2) in the final rule, should
we finalize the comparative payment rate analysis proposal.
The AMRP process also currently includes in Sec.
447.203(b)(5)(ii)(D) pre- and post-natal obstetric services including
labor and delivery; we are proposing to include these services in the
comparative payment rate analysis requirements under proposed Sec.
447.203(b)(2)(ii), but intend to broaden the scope of this category of
services to include both obstetrical and gynecological services. This
expanded proposed provision would capture a wider array of services,
both obstetrical and gynecological services, for States and CMS to
assess and ensure access to care in Medicaid FFS is at least as great
for beneficiaries as is generally available to the general population
in the geographic area, as required by with section 1902(a)(30)(A) of
the Act. Lastly, similar to current Sec. 447.203(b)(5)(ii)(E), which
specifies that Home health services are included in the AMRP process,
we are proposing to include personal care, home health aide, and
homemaker services, provided by individual providers and providers
employed by an agency. This refined proposed provision would help
ensure a more standardized effort to monitor access across Medicaid
delivery systems, including for Medicaid-covered LTSS. We believe this
proposal also addresses public comments received in response to the
February 2022 RFI.\148\ Many commenters highlighted the workforce
crisis among direct care workers and the impact on HCBS. Specifically,
commenters indicated that direct care workers receive low payment
rates, and for agency-employed direct care workers, home health
agencies often cite low Medicaid payment as a barrier to raising wages
for workers. Commenters suggested that States should be collecting and
reporting to CMS the average of direct care worker wages while
emphasizing the importance of data transparency and timeliness. We are
responding to these public comments through this proposed rule by
proposing to require States to transparently publish a payment rate
disclosure that collects and reports the average hourly rate paid to
individual providers and providers employed by an agency for services
provided by certain direct care workers (personal care, home health
aide, and homemaker services).
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\148\ Summary of Public Comments in response to the CMS 2022
Request for Information: Access to Coverage and Care in Medicaid &
CHIP. December 2022. For the report, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-report.pdf.
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In public comments that we received during the public comment
period for the 2015 final rule with comment period, many commenters
requested that we require States to publish access to care analyses for
pediatric services, including pediatric primary care, behavioral
health, and dental care. At the time, we responded that pediatric
services did not need to be specified in the required service
categories because States were already required through Sec.
447.203(b)(1)(iv) to consider the characteristics of the beneficiary
population, ``including . . . payment variations for pediatric and
adult populations,'' within the AMRPs.\149\ Although we are proposing
to eliminate the AMRP requirements, our proposed rule continues to
include special considerations for pediatric populations that are
addressed in the discussion of proposed paragraph (b)(2).
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\149\ 80 CFR 67576 at 67592.
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We are proposing to eliminate the following from the current AMRP
process without replacement in the proposed comparative payment rate
analysis requirement, Sec. 447.203(b)(5)(ii)(F): Any additional types
of services for which a review is required under current Sec.
447.203(b)(6); Sec. 447.203(b)(5)(ii)(G): Additional types of services
for which the State or CMS has received a significantly higher than
usual volume of beneficiary, provider or other interested party access
complaints for a geographic area, including complaints received through
the mechanisms for beneficiary input consistent with current Sec.
447.203(b)(7); and Sec. 447.203(b)(5)(ii)(H): Additional types of
services selected by the State.
We propose to eliminate Sec. 447.203(b)(5)(ii)(F) and (G) without
a direct replacement because the proposed State Analysis Procedures for
Rate Reduction or Restructuring described in Sec. 447.203(c) are
inclusive of and more refined than the current AMRP requirements for
additional types of services for which a review is required under
current Sec. 447.203(b)(6). Specifically, as discussed later in this
section, we are proposing in Sec. 447.203(c)(1) that States seeking to
reduce provider payment rates or restructure provider payments would be
required to provide written assurance and relevant supporting
documentation that three conditions are met to qualify for a
streamlined SPA review process, including that required public
processes yielded no significant access to care concerns for
beneficiaries, providers, or other interested parties, or if such
processes did yield concerns, that the State can reasonably respond to
or mitigate them, as appropriate. If the State is unable to meet all
three of the proposed conditions for streamlined SPA review, including
the absence of or ability to appropriately address any access concern
raised through public processes, then the State would be required to
submit additional information to support that its SPA is consistent
with the access requirement in section 1902(a)(30)(A) of the Act, as
proposed in Sec. 447.203(c)(2). We are proposing to modify this aspect
of the current AMRP process, because our implementation experience
since the 2017 SMDL has shown that States typically have been able to
work directly with the public (including beneficiaries and beneficiary
advocacy groups, and providers) to resolve access concerns, which
emphasizes that public feedback continues to be a valuable source of
knowledge regarding access in Medicaid. We believe this experience
demonstrates that public processes that occur before the submission of
a payment SPA to CMS often resolve initial access concerns, and where
concerns persist, they will be addressed through the SPA submission and
our review process, as provided in proposed Sec. 447.203(c). Rather
than services affected by proposed provider rate reductions or
restructurings (current Sec. 447.203(b)(5)(ii)(F)) and services for
which the State or CMS received significantly higher than usual volume
of complaints (current Sec. 447.203(b)(5)(ii)(G)) being addressed
through an AMRP, these services subject to rate reductions or
restructurings and services where a high volume of complaints have been
expressed would now be addressed by the State analysis procedures in
proposed Sec. 447.203(c). We believe this approach would ensure public
feedback is fully considered in the context of a payment SPA, without
the need to specifically require a
[[Page 28008]]
comparative payment rate analysis for the service(s) subject to payment
rate reduction or restructuring under proposed Sec. 447.203(b)(2).
Lastly, we propose to eliminate current Sec. 447.203(b)(5)(ii)(H),
requiring the AMRP include analysis regarding ``Additional types of
services selected by the State,'' without a direct replacement because
our implementation experience has shown that the majority of States did
not select additional types of service to include in their AMRPs beyond
the required services Sec. 447.203(b)(5)(ii)(A) through (G). When
assessing which services to include in this proposed rule, we
determined that the absence of an open-ended type of service option,
similar to Sec. 447.203(b)(5)(ii)(H) is unlikely to affect the quality
of the analysis proposed in this rule and therefore, we are not
including it in the proposed set of services required for the
comparative payment rate analysis. These shifts in policy were informed
by our implementation experience and our consideration of State
concerns about the burden and value of the AMRP process.
In paragraph (b)(3), we propose that the State agency would be
required to develop and publish, consistent with the publication
requirements described in paragraph (b)(1) of this section for payment
rate transparency data, a comparative payment rate analysis and payment
rate disclosure. This comparative payment rate analysis is divided into
two sections based on the categories of services and the organization
of each analysis or disclosure. Paragraph (b)(3)(i) describes the
comparative payment rate analysis for the categories of service
described in paragraphs (b)(2)(i) through (iii): primary care services,
obstetrical and gynecological services, and outpatient behavioral
health services. Paragraph (b)(3)(ii) describes the payment rate
disclosure for the categories of service described in paragraphs
(b)(2)(iv): personal care, home health aide, and homemaker services
provided by individual providers and providers employed by an agency.
Specifically, in paragraph (b)(3)(i), we propose that for the
categories of service described in paragraphs (b)(2)(i) through (iii),
the State's analysis would compare the State's Medicaid FFS payment
rates to the most recently published Medicare payment rates effective
for the same time period for the E/M CPT/HCPCS codes applicable to the
category of service. The proposed comparative payment rate analysis of
FFS Medicaid payment rates to FFS Medicare payment rates would be
conducted on a code-by-code basis at the CPT/HCPCS code level using the
most current set of codes published by us. It is intended to provide an
understanding of how Medicaid payment rates compare to the payment
rates established and updated under the FFS Medicare program.
We would expect to publish the E/M CPT/HCPCS codes to be used for
the comparative payment rate analysis in subregulatory guidance along
with the final rule, if this proposal is finalized. We propose that we
would identify E/M CPT/HCPCS codes to be included in the comparative
payment rate analysis based on the following criteria: the code is
effective for the same time period of the comparative payment rate
analysis; the code is classified as an E/M CPT/HCPCS code by the
American Medical Association (AMA) CPT Editorial Panel; the code is
included on the Berenson-Eggers Type of Service (BETOS) code list
effective for the same time period as the comparative payment rate
analysis and falls into the E/M family grouping and families and
subfamilies for primary care services, obstetrics and gynecological
services, and outpatient behavioral services; and the code has an A
(Active), N (Non-Covered), R (Restricted), or T (Injections) code
status on the Medicare PFS with a Medicare established relative value
unit (RVU) and payment amount for the same time period of the
comparative payment rate analysis.150 151 152
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\150\ https://www.ama-assn.org/practice-management/cpt/cpt-evaluation-and-management.
\151\ https://data.cms.gov/provider-summary-by-type-of-service/provider-service-classifications/restructured-betos-classification-system.
\152\ https://www.cms.gov/medicare/medicare-fee-for-service-payment/physicianfeesched.
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The CMS published list of E/M CPT/HCPCS codes subject to the
comparative payment rate analysis would classify each E/M CPT/HCPCS
code into a corresponding category of service as described in proposed
Sec. 447.203(b)(2)(i) through (iii). As previously discussed, by
narrowing the comparative payment rate analysis to CMS-specified E/M
CPT/HCPCS codes, we are proposing States' analyses include a broad
range of core services which would cover a variety of commonly provided
services that fall into the categories of service proposed in
paragraphs (b)(2)(i) through (iii), while also limiting the services to
those delivered primarily by physicians and NPPs in an office-based
setting. Based on the categories of services specified in proposed
Sec. 447.203(b)(2)(i) through (iii), we expect the selected E/M CPT/
HCPCS codes to fall under mandatory Medicaid benefit categories, and
therefore, we expect that all States would cover and pay for the
selected E/M CPT/HCPCS codes. To clarify, we did not narrow the list of
E/M CPT/HCPCS codes to those with an A (Active), N (Non-Covered), R
(Restricted), or T code status on the Medicare PFS with a Medicare
established relative value unit (RVU) and payment amount on the basis
of Medicare coverage of a particular code. We are cognizant that codes
with N (Non-Covered), R (Restricted), or T code statuses have limited
or no Medicare coverage, however, Medicare may establish RVUs and
payment amounts for these codes. Therefore, when Medicare does
establish RVUs and payment amounts for codes with N (Non-Covered), R
(Restricted), or T (Injections) code statuses on the Medicare PFS, we
are proposing to include these codes in the comparative payment rate
analysis in order to ensure the analysis includes a comprehensive set
of codes, for example pediatric services, including well child visits
(for example, 99381 through 99384), that are commonly provided services
that fall into the categories of service proposed in paragraphs
(b)(2)(i) through (iii) and delivered primarily by physicians and NPPs
in an office-based setting, as previously described.
As discussed later in this rule, we propose that the comparative
payment rate analysis would be updated no less than every 2 years.
Therefore, prior to the start of the calendar year in which States
would be required to update their comparative payment rate analysis, we
would intend to publish an updated list of E/M CPT/HCPCS codes for
States to use for their comparative payment rate analysis updates
through subregulatory guidance. The updated list of E/M CPT/HCPCS codes
would incorporate changes made by to the AMA CPT Editorial Panel (such
as additions, removals, or amendments to a code definition where there
is a change in the set of codes classified as an E/M CPT/HCPCS code
billable for primary care services, obstetrics and gynecological
services, or outpatient behavioral services) and changes to the
Medicare PFS based on the most recent Medicare PFS final rule (such as
changes in code status or creation of Medicare-specific codes).\153\
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\153\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.
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We intend to publish the initial and subsequent updates of the list
of E/M CPT/HCPCS codes subject to the comparative payment rate analysis
in a timely manner that allows States approximately one full calendar
year between the publication of the CMS-
[[Page 28009]]
published list of E/M CPT/HCPCS codes and the due date of the
comparative payment rate analysis, if this proposal is finalized. We
are aware that Medicare may issue a correction to the Medicare PFS
after the final rule is in effect, and this correction may impact our
published list of E/M CPT/HCPCS codes. In this instance, for codes
included on our published list of E/M CPT/HCPCS codes that are affected
by a correction to the most recent Medicaid PFS final rule, we may add
or remove an E/M CPT/HCPCS code from the published list, as
appropriate, depending on the change to the Medicare PFS.
Alternatively, depending on the nature of the change, we would expect
States to accurately identify which code(s) are used in the Medicaid
program during the relevant period that best correspond to the CMS-
identified E/M CPT/HCPCS code(s) affected by the Medicare PFS
correction. We would expect States to rely on the CMS published list of
E/M CPT/HCPCS codes subject to the comparative payment rate analysis
for complying with the proposed requirements in paragraphs (b)(2)
through (4).
We acknowledge that there are limitations to relying on E/M CPT/
HCPCS codes to select payment rates for comparative payment rate
analysis to aid States, CMS, and other interested parties in assessing
if 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. Providers across the country and within each State
deliver a variety of services to patients, including individuals with
public and private sources of coverage, and then bill them under a
narrow subset of CPT/HCPCS codes that fit into the E/M classification
as determined by the AMA CPT Editorial Panel. The actual services
delivered can require a wide array of time, skills, and experience of
the provider which must be represented by a single five digit code for
billing to receive payment for the services delivered. While there are
general principles that guide providers in billing the most
representative E/M CPT/HCPCS code for the service they delivered, two
providers might perform substantially similar activities when
delivering services and yet bill different E/M CPT/HCPCS codes for
those activities, or bill the same E/M CPT/HCPCS code for furnishing
two very different services. The E/M CPT/HCPCS code itself is not a
tool for capturing the exact service that was delivered, but medical
documentation helps support the billing of a particular E/M CPT/HCPCS
code.
Although they do not encompass all Medicaid services covered and
paid for in the Medicaid program which are subject to the requirements
in section 1902(a)(30)(A) of the Act, E/M CPT/HCPCS codes are some of
the most commonly billed codes and including them in the comparative
payment rate analysis would allow us to uniformly compare Medicaid
payment rates for these codes to Medicare PFS rates. As such, to
balance administrative burden on States and our enforcement
responsibilities, we are proposing to use E/M CPT/HCPCS codes in the
comparative payment rate analysis to define the parameters of our
analysis to how much Medicaid and the FFS Medicare program would pay
for services that can be classified into a particular E/M CPT/HCPCS
code. We are seeking public comment on the proposed comparative payment
rate analysis requirement in Sec. 447.203(b)(3)(i), including the
proposed requirement to conduct the analysis at the CPT/HCPCS code
level, the proposed criteria that we would apply in selecting E/M CPT/
HCPCS codes for inclusion in the required analysis, and the proposed
requirement for States to compare Medicaid payment rates for the
selected E/M CPT/HCPCS codes to the most recently published Medicare
non-facility payment rate as listed on the Medicare PFS effective for
the same time period which is discussed in more detail later in this
rule when describing the proposed provisions of Sec.
447.203(b)(3)(i)(C).
In paragraph (b)(3)(i), we further propose that the State's
comparative payment rate analysis would be required to meet the
following requirements: (A) the analysis must be organized by category
of service as described in Sec. 447.203(b)(2)(i) through (iii); (B)
the analysis must clearly identify the Medicaid base payment rates for
each E/M CPT/HCPCS code identified by us under the applicable category
of service, including, if the rates vary, separate identification of
the payment rates by population (pediatric and adult), provider type,
and geographical location, as applicable; (C) the analysis must clearly
identify the Medicare PFS non-facility payment rates effective for the
same time period for the same set of E/M CPT/HCPCS codes, and for the
same geographical location as the Medicaid base payment rates, that
correspond to the Medicaid payment rates identified under paragraph
(b)(3)(i)(B); (D) the analysis must specify the Medicaid payment rate
identified under paragraph (b)(3)(i)(B) as a percentage of the Medicare
payment rate identified under paragraph (b)(3)(i)(C) for each of the
services for which the Medicaid payment rate is published under
paragraph (b)(3)(i)(B); and (E) the analysis must specify the number of
Medicaid-paid claims within a calendar year for each of the services
for which the Medicaid payment rate is published under paragraph
(b)(3)(i)(B). We are seeking public comment on the proposed
requirements and content of the items in proposed Sec.
447.203(b)(3)(i)(A) through (E).
In paragraph (b)(3)(i)(A), we propose to require States to organize
their comparative payment rate analysis by the service categories
described in paragraphs (b)(2)(i) through (iii) of this section. This
proposed requirement is included to ensure the analysis breaks out the
payment rates for primary care services, obstetrical and gynecological
services, and outpatient behavioral health services separately for
individual analyses of the payment rates for each CMS-selected E/M CPT/
HCPCS code, grouped by category of service. We are seeking public
comment on the proposed requirement for States to break out their
payment rates at the CPT/HCPCS code level for primary care services,
obstetrical and gynecological services, and outpatient behavioral
health services, separately, in the comparative payment rate analysis
as specified in proposed Sec. 447.203(b)(3)(i)(A).
In paragraph (b)(3)(i)(B), after organizing the analysis by Sec.
447.203(b)(2)(i) through (iii) categories of service and CMS-specified
E/M CPT/HCPCS code, we propose to require States to clearly identify
the Medicaid base payment rate for each code, including, if the rates
vary, separate identification of the payment rates by population
(pediatric and adult), provider type, and geographical location, as
applicable. We propose that the Medicaid base payment rate in the
comparative payment rate analysis would only include the State's
Medicaid fee schedule rate, that is, the State's Medicaid base rate for
each E/M CPT/HCPCS code. By specifying the services included in the
comparative payment rate analysis by E/M CPT/HCPCS code, we expect the
Medicaid base payment rate in the comparative payment rate analysis
would only include the State's Medicaid fee schedule rate for that
particular E/M CPT/HCPCS code as published on the State's Medicaid fee
schedule effective for the same time period covered by the comparative
payment rate analysis. As an example,
[[Page 28010]]
the State's Medicaid fee schedule rate as published on the Medicaid fee
schedule effective for the time period of the comparative payment rate
analysis for 99202 is listed as $50.00. This rate would be the Medicaid
base payment rate in the State's comparative payment rate analysis for
comparison to the Medicare non-facility rate which is discussed later
in this section.
Medicaid base payment rates are typically determined through one of
three methods: the resource-based relative value scale (RBRVS), a
percentage of Medicare's fee, or a State-developed fee schedule using
local factors.\154\ The RBRVS system, initially developed for the
Medicare program, assigns a relative value to every physician procedure
based on the complexity of the procedure, practice expense, and
malpractice expense. States may also adopt the Medicare fee schedule
rate, which is also based on RBRVS, but select a fixed percentage of
the Medicare amount to pay for Medicaid services. States can develop
their own PFSs, typically determined based on market value or an
internal process, and often do this in situations where there is no
Medicare or private payer equivalent or when an alternate payment
methodology is necessary for programmatic reasons. States often adjust
their payment rates based on provider type, geography, site of
services, patient age, and in-State or out-of-State provider status.
Additionally, Medicaid base payment rates can be paid to physicians in
a variety of settings, including clinics, community health centers, and
private offices.
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\154\ https://www.macpac.gov/wp-content/uploads/2017/02/Medicaid-Physician-Fee-for-Service-Payment-Policy.pdf.
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We acknowledge that only including Medicaid base payments in the
analysis does not necessarily represent all of a provider's revenues
that may be related to furnishing services to Medicaid beneficiaries,
and that other revenues not included in the proposed comparative
analysis may be relevant to a provider's willingness to participate in
Medicaid (such as beneficiary cost sharing payments, disproportionate
share hospital payments for qualifying hospitals, supplemental
payments, etc.). Public comments we received on the 2011 proposed rule
and responded to in the 2015 final rule with comment period regarding
the AMRPs expressed differing views regarding which provider
``revenues'' should be included within comparisons of Medicaid to
Medicare payment rates. One commenter ``noted that the preamble of the
2011 proposed rule refers to `payments' and `rates' interchangeably but
that courts have defined payments to include all Medicaid provider
revenues rather than only Medicaid FFS rates.'' The commenter stated
that if the final rule consider[ed] all Medicaid revenues received by
providers, States may be challenged to make any change to the Medicaid
program that might reduce provider revenues.'' \155\ This proposed rule
narrows the Medicaid base payment rates to the amount listed on the
State's fee schedule in order for the comparative payment rate analysis
to accurately and analogously compare Medicaid fee schedule rates to
Medicare fee schedule rates as listed on the Medicare PFS.
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\155\ 80 FR 67576 at 67581.
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We believe this proposal represents the best way to create a
consistent metric across States against which to evaluate access. To be
specific, we are not proposing to include supplemental payments in the
comparative payment rate analysis. Requiring supplemental payment data
be collected and included under this rule would be duplicative of
existing requirements. State supplemental payment and DSH payment data
are already subject to our review in various forms, such as through DSH
audits for DSH payments, and through annual upper payment limits
demonstrations, and through supplemental payment reporting under
section 1903(bb) of the Act.156 157 As such, we do not see a
need to add additional reporting requirements concerning supplemental
payments as part of the proposals in this rulemaking to allow us the
opportunity to review the data. Also, supplemental payments are often
made for specific Medicaid-covered services and targeted to a subset of
Medicaid-participating providers; not all Medicaid-participating
providers, and not all providers of a given Medicaid-covered service,
may receive supplemental payments in a State. Therefore, including
supplemental payments in the comparative payment rate analysis would
create additional burden for States without then also providing an
accurate benchmark of how payments may affect beneficiary access due to
the potentially varied and uneven distribution of supplemental
payments. Accordingly, we are proposing to require that States conduct
the comparative payment rate analysis for only Medicaid base payment
rates for selected E/M CPT/HCPCS codes. For each proposed category of
service listed in paragraphs (b)(2)(i) through (iii), this would result
in a transparent and parallel comparison of Medicaid base payment rates
that all Medicaid-participating providers of the service would receive
to the payment rates that Medicare would pay for the same E/M CPT/HCPCS
codes.
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\156\ CMS State Medicaid Director Letter: SMDL 13-003. March
2013. Federal and State Oversight of Medicaid Expenditures.
Available at https://www.medicaid.gov/sites/default/files/Federal-Policy-Guidance/Downloads/SMD-13-003-02.pdf.
\157\ CMS State Medicaid Director Letter: SMDL 21-006. December
2021. New Supplemental Payment Reporting and Medicaid
Disproportionate Share Hospital Requirements under the Consolidated
Appropriations Act, 2021. Available at https://www.medicaid.gov/federal-policy-guidance/downloads/smd21006.pdf.
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Additionally, in paragraph (b)(3)(i)(B), we propose that, if the
States' payment rates vary, the Medicaid base payment rates must
include a breakdown by payment rates paid to providers delivering
services to pediatric and adult populations, by provider type, and
geographical location, as applicable, to capture this potential
variation in the State's payment rates. This proposed provision to
breakdown the Medicaid payment rate is first stated in proposed
paragraph (b)(2) and carried through in proposed paragraph (b)(3)(i)(B)
to provide clarity to States about how the Medicaid payment rate should
be reported in the comparative payment rate analysis.
In paragraph (b)(3)(i)(C), we propose to require States'
comparative payment rate analysis clearly identify the Medicare non-
facility payment rates effective for the same time period for the same
set of E/M CPT/HCPCS codes, and for the same geographical location,
that correspond to the Medicaid payment rates identified under
paragraph (b)(3)(i)(B), including, separate identification of the
payment rates by provider type. We are not proposing to establish a
threshold percentage of Medicare non-facility payment rates that States
would be required to meet when setting their Medicaid payment rates.
Rather, we are proposing to use Medicare non-facility payment rates as
listed on the Medicare PFS as a benchmark to which States would compare
their Medicaid payment rates to inform their and our assessment of
whether the State's payment rates are compliant with section
1902(a)(30)(A) of the Act. Benchmarking against FFS Medicare, another
of the nation's large public health coverage programs, serves as an
important data point in determining whether payment rates are likely to
be sufficient to ensure access for Medicaid beneficiaries at least as
great as for the general population in the geographic area, and whether
any identified access concerns may be related to payment sufficiency.
Similar to Medicaid, Medicare provides health coverage for a
significant number of
[[Page 28011]]
Americans across the country. In December 2022, total Medicaid
enrollment was at 85.2 million individuals \158\ while total Medicare
enrollment was at 65.4 million individuals.159 160 Both the
Medicare and Medicaid programs cover and pay for services provided to
beneficiaries residing in every State and territory of the United
States. As previously described, Medicare non-facility payment rates as
listed on the Medicare PFS for covered, non-covered, and limited
coverage services generally are determined on a national level as well
as adjusted to reflect the variation in practice costs from one
geographical location to another. Medicare also ensures that their
payment rate data are publicly available in a format that can be
analyzed. The accessibility and consistency of the Medicare non-
facility payment rates as listed on the Medicare PFS, compared to
negotiated private health insurance payment rates that typically are
considered proprietary information and, therefore, not generally
available to the public, makes Medicare non-facility payment rates as
listed on the Medicare PFS an available and reliable comparison point
for States to use in the comparative payment rate analysis.
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\158\ https://www.medicaid.gov/medicaid/national-medicaid-chip-program-information/downloads/December-2022-medicaid-chip-enrollment-trend-snapshot.pdf.
\159\ Total Medicare enrollment equals the Tot_Benes variable in
the Medicare Monthly Enrollment Data for December (Month) 2022
(Year) at the national level (Bene_Geo_Lvl). Tot_Benes is a count of
all Medicare beneficiaries, including beneficiaries with Original
Medicare and beneficiaries with Medicare Advantage and Other Health
Plans. We utilized the count of all Medicare beneficiaries because
Original Medicare, Medicare Advantage, and other Health Plans offer
fee-for-service payments to providers. See the Medicare Monthly
Enrollment Data Dictionary for more information about the variables
in the Medicare Monthly Enrollment Data: https://data.cms.gov/sites/default/files/2023-02/1ec24f76-9964-4d00-9e9a-78bd556b7223/Medicare%20Monthly%20Enrollment_Data_Dictionary%2020230131_508.pdf.
\160\ https://data.cms.gov/summary-statistics-on-beneficiary-enrollment/medicare-and-medicaid-reports/medicare-monthly-enrollment.
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Additionally, Medicare is widely accepted nationwide according to
recent findings from the National Electronic Health Records Survey. In
2019, 95 percent of physicians accepting new patients overall, and 89
percent of office-based physicians, were accepting new Medicare
patients, and the percentage of office-based physicians accepting new
Medicare patients has remained stable since 2011 when the value was 88
percent, with modest fluctuations in the years in between.\161\ In
regards to physician specialties that align with the proposed
categories of services in this rule, 81 percent of general practice/
family medicine physicians and 81 percent of physicians specializing in
internal medicine were accepting new Medicare patients, 93 percent of
physicians specializing obstetrics and gynecology were accepting new
Medicare patients, and 60 percent of psychiatrists were accepting new
Medicare patients in 2019. Although the percentage of psychiatrists who
accept Medicare is lower than other types physicians providing services
included in the comparative payment rate analysis, this circumstance is
not unique to Medicare amongst payers. For example, 60 percent of
psychiatrists were also accepting new privately insured patients in
2019. Therefore, the decreased rate of acceptance by psychiatrists
relative to certain other physician specialists does not make Medicare
an inappropriate benchmark when evaluated against other options for
comparison.\162\
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\161\ https://www.kff.org/medicare/issue-brief/most-office-based-physicians-accept-new-patients-including-patients-with-medicare-and-private-insurance/.
\162\ https://www.kff.org/medicare/issue-brief/faqs-on-mental-health-and-substance-use-disorder-coverage-in-medicare/.
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Historically, Medicare has low rates of physicians formally opting
out of the Medicare program with 1 percent of physicians consistently
opting out between 2013 and 2019 and of that 1 percent of physicians
opting out of Medicare, 42 percent were psychiatrists.\163\ This
information suggests that Medicare's payment rates generally are
consistent with a high level of physician willingness to accept new
Medicare patients, with the vast majority of physicians willing to
accept Medicare's payment rates. For the reasons previously described,
we are proposing to use Medicare non-facility payment rates as listed
on the Medicare PFS as a national benchmark for States to compare their
Medicaid payment rates in the comparative payment rate analysis because
we believe that the Medicare payment rates for these services are
likely to serve as a reliable benchmark for a level of payment
sufficient to enlist providers to furnish the relevant services to an
individual. We are seeking public comment on the proposed used of
Medicare non-facility payment rates as listed on the Medicare PFS as a
benchmark for States to compare their Medicaid payment rates to in the
comparative payment rate analysis requirements in proposed Sec.
447.203(b)(3)(i) to help assess if Medicaid 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.
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\163\ Physicians and practitioners who do not wish to enroll in
the Medicare program may ``opt-out'' of Medicare. This means that
neither the physician, nor the beneficiary submits the bill to
Medicare for services rendered. Instead, the beneficiary pays the
physician out-of-pocket and neither party is reimbursed by Medicare.
A private contract is signed between the physician and the
beneficiary that states, that neither one can receive payment from
Medicare for the services that were performed. See 2022 opt-out
affidavit data published by the Centers for Medicare & Medicaid
services: https://data.cms.gov/provider-characteristics/medicare-provider-supplier-enrollment/opt-out-affidavits.
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Specifically, in paragraph (b)(3)(i)(C), we propose to require
States to compare their Medicaid payment rates to the Medicare non-
facility payment rates effective for the same time period as the same
set of E/M CPT/HCPCS codes paid under Medicaid as specified under
paragraph (b)(3)(i)(B) of this section, including, separate
identification of the payment rates by provider type. We propose to
require States to compare their payment rates to the corresponding
Medicare PFS non-facility rates because we are seeking a payment
analysis that compares Medicaid payment rates to Medicare payment rates
at comparable location of service delivery (that is, in a non-clinic,
non-hospital, ambulatory setting such as a physician's office). States
often pay physicians operating in an office based on their Medicaid fee
schedule whereas they may pay physicians operating in hospitals or
clinics using an encounter rate. The Medicaid fee schedule rate
typically reflects payment for an individual service that was rendered,
for example, an office visit that is billed as a single CPT/HCPCS code.
An encounter rate often reflects reimbursement for total facility
specific costs divided by the number of encounters to calculate a per
visit or per encounter rate that is paid to the facility for all
services received during an encounter, regardless of which specific
services are provided during a particular encounter. For example, the
same encounter rate may be paid for a beneficiary who has an office
visit with a physician, a dental examination and cleaning from a
dentist, and laboratory tests and for a beneficiary who receives an
office visit with a physician and x-rays. Encounter rates are typically
paid to facilities, such as hospitals, FQHCs, RHCs, or clinics, many of
which function as safety net providers that offer a wide variety of
medical services. Within the Medicaid program, encounter rates can vary
[[Page 28012]]
widely in the rate itself and services paid for through the encounter
rate. Proposing States demonstrate the economy and efficiency of their
encounter rates would be an entirely different exercise to the fee
schedule rate comparison proposed in this rule because encounter rates
are often based on costs unique to the provider, and States often
require providers to submit cost reports to States for review to
support payment of the encounter rate. Comparing cost between the
Medicaid and Medicare program would require a different methodology,
policies, and oversight than what is proposed in this rule due to the
differences within and between each program. While the Medicare program
has a broad, national policy for calculating encounter rates for
providers, including prospective payment systems for hospitals, FQHCs,
and other types of facilities, Medicare calculates these encounter
rates differently than States may calculate analogous rates in
Medicaid. Therefore, proposing States disaggregate each of their
encounter rates and services covered in each encounter rate to compare
to Medicare's encounter rates would be challenging for States.
From that logic, we likewise determined that the Medicare non-
facility payment rates as listed on the Medicare PFS rate afforded the
best point of comparison because it is the most accurate and most
analogous comparison of a service-based access analysis using Medicare
non-facility payment rates as listed on the Medicare PFS as a benchmark
to compare Medicaid fee schedule rates on a CPT/HCPCS code level basis,
as opposed to an encounter rate which could include any number of
services or specialties. The Medicare non-facility payment rate as
listed on the Medicare PFS is described as ``. . . the fee schedule
amount when a physician performs a procedure in a non-facility setting
such as the office'' and ``[g]enerally, Medicare gives higher payments
to physicians and other health care professionals for procedures
performed in their offices [compared to those performed elsewhere]
because they must supply clinical staff, supplies, and equipment.''
\164\ As such, we believe the Medicaid fee schedule best represents the
payment intended to pay physicians and non-physician practitioners for
delivery of individual services in an office (non-facility) setting,
and the Medicare non-facility payment rate as listed on the Medicare
PFS represents the best equivalent to that amount and consideration.
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\164\ https://www.cms.gov/files/document/physician-fee-schedule-guide.pdf.
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For the purposes of the comparative payment rate analysis, we would
expect States to source the Medicare non-facility payment rate from the
published Medicare fee schedule amounts on the Medicare PFS through one
or both of the following sources: the Physician Fee Schedule Look-Up
Tool \165\ on cms.gov or Excel file downloads of the Medicare PFS
Relative Value Files \166\ for the relevant calendar year from cms.gov.
We encourage States to begin sourcing Medicare non-facility payment
rates from the Physician Fee Schedule Look-Up Tool and utilize the
Physician Fee Schedule Guide for instructions on using the Look-Up
Tool. When codes are not available in the Look-Up Tool, we would direct
States to the Excel file downloads of the Medicare PFS Relative Value
Files where States can find necessary information for calculating
Medicare non-facility payment rates.
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\165\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PFSlookup.
\166\ https://www.cms.gov/medicare/medicare-fee-for-service-payment/physicianfeesched/pfs-relative-value-files.
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As described in the Medicare Claims Processing Manual, most
physician services are paid according to the Medicare PFS and the fee
schedule amounts for a particular procedure code (including HCPCS, CPT,
and CDT) are computed using a resource-based formula made up of three
components of a procedure's RVU: physician work, practice expense, and
malpractice as well as geographical differences in each locality area
of the country.\167\ The resource-based formula also includes
adjustments to reflect the variation in practice costs from one
geographical location to another. Medicare establishes a geographic
practice cost index (GPCI) for every Medicare payment locality for each
of the three components of a procedure's RVU for physician work,
practice expense, and malpractice and applies the GPCIs in the
calculation of a fee schedule payment amount by multiplying the RVU for
each component times the GPCI for that component.\168\
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\167\ https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/clm104c12.pdf.
\168\ https://www.cms.gov/medicare/physician-fee-schedule/search/overview.
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Medicare also includes adjustments to the fee schedule amounts, for
example, based on site of service (non-facility versus facility
setting), where the rate, facility or non-facility, that a physician
service is paid under the PFS is determined by the place of service
(POS) code that is used to identify the setting where the beneficiary
received the face-to-face encounter with the billing practitioner. We
are proposing States use the Medicare non-facility payment rate as
listed on the Medicare PFS in the comparative payment rate analysis.
For codes that are not available in the Look-Up Tool, we would direct
States to the Excel file downloads of the Medicare PFS Relative Value
Files which include the RVUs, GPCI, and the ``National Physician Fee
Schedule Relative Value File Calendar Year 2023'' file which contains
the associated relative value units (RVUs), a fee schedule status
indicator, and various payment policy indicators needed for payment
adjustment (i.e., payment of assistant at surgery, team surgery,
bilateral surgery, etc.). We expect States to utilize the formula for
the Non-Facility Pricing Amount in ``National Physician Fee Schedule
Relative Value File Calendar Year 2023'' file to calculate the ``Non-
Facility Price'' using the RVUs, GPCIs, and conversion factors for
codes not available in the Look-Up Tool. For codes available in the
Look-Up Tool, we expect States to specifically use the Medicare payment
rates listed under the ``Non-Facility Price'' header as described on
the Medicare PFS. The Non-Facility Price is the established Medicare
payment rate as listed on the Medicare PFS which includes the amount
that Medicare pays for the claim and any applicable co-insurance and
deductible amounts owed by the patient.
Medicaid fee-schedule rates should be representative of the total
computable payment amount a provider would expect to receive as
payment-in-full for the provision of Medicaid services to individual
beneficiaries. 42 CFR 447.15 defines payment-in-full as ``the amounts
paid by the agency plus any deductible, coinsurance or copayment
required by the plan to be paid by the individual.'' Therefore, the
State's Medicaid base payment rate used for comparison should be
inclusive of total base payment from the Medicaid agency plus any
applicable coinsurance and deductibles to the extent that a beneficiary
is expected to be liable for those payments. If a State Medicaid fee
schedule does not include these additional beneficiary cost-sharing
payment amounts, then the Medicaid fee schedule amounts would need to
be modified to align with the inclusion of expected beneficiary cost
sharing in Medicare's non-facility payment rates as listed on the
Medicare PFS.\169\
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\169\ According to the Medicare Physician Fee Schedule Guide,
for most codes, Medicare pays 80% of the amount listed and the
beneficiary is responsible for 20 percent.
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[[Page 28013]]
In paragraph (b)(3)(i)(C), we propose that the Medicare non-
facility payment rates must be effective for the same time period for
the same set of E/M CPT/HCPCS codes that correspond to the Medicaid
base payment rates identified under paragraph (b)(3)(i)(B) of this
section. We included this language to ensure the comparative payment
rate analysis is as accurate and analogous as possible by proposing
that the Medicaid and Medicare payment rates that are effective during
the same time period for the same set of E/M CPT/HCPCS codes. As later
described in this rule, in paragraph (b)(4), we propose the initial
comparative payment rate analysis and payment rate disclosure of its
Medicaid payment rates would be a retroactive analysis of payment rates
that are in effect as of January 1, 2025, with the analysis and
disclosure published no later than January 1, 2026. For example, the
first comparative payment rate analysis a State develops and publishes
would compare Medicaid base payment rates in effect as of January 1,
2025, to the Medicare non-facility payment rates effective January 1,
2025, to ensure the Medicare non-facility payment rates are effective
for the same time period for the same set of E/M CPT/HCPCS codes that
correspond to the Medicaid base payment rates identified under
paragraph (b)(3)(i)(B) of this section.
Additionally, in paragraph (b)(3)(i)(C), we propose that the
Medicare non-facility payment rates as listed on the Medicare PFS used
for the comparison must be for the same geographical location as the
Medicaid base payment rates. For States that pay Medicaid payment rates
based on geographical location (for example, payment rates that vary by
rural or non-rural location, by zip code, or by metropolitan
statistical area), we propose that States comparative payment rate
analysis would need to utilize the Medicare non-facility payment rates
as listed on the Medicare PFS for the same geographical location as the
Medicaid base payment rates to achieve an equivalent comparison. We
would expect States to review Medicare's published listing of the
current PFS locality structure organized by State, locality area, and
when applicable, counties assigned to each locality area and identify
the comparable Medicare locality area for the same geographical area as
the Medicaid base payment rates.\170\
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\170\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Locality.
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We recognize that States that make Medicaid payment based on
geographical location may not use the same locality areas as Medicare.
For example, a State may use its own State-determined geographical
designations, resulting in 5 geographical areas in the State for
purposes of Medicaid payment while Medicare recognizes 3 locality areas
for the State based on Metropolitan Statistical Area (MSA) delineations
determined by the US Office of Management and Budget (OMB) and are the
result of the application of published standards to Census Bureau
data.\171\ In this instance, we would expect the State to determine an
appropriate method to accomplish the comparative payment rate analysis
that aligns the geographic area covered by each payer's rate as closely
as reasonably feasible. For example, if the State identifies two
geographic areas for Medicaid payment purposes that are contained
almost entirely within one Medicare geographic area, then the State
reasonably could determine to use the same Medicare non-facility
payment rate as listed on the Medicare PFS in the comparative payment
rate analysis for each Medicaid geographic area. As another example, if
the State defined a single geographic area for Medicaid payment
purposes that contained two Medicare geographic areas, then the State
might determine a reasonable method to weight the two Medicare payment
rates applicable within the Medicaid geographic area, and then compare
the Medicaid payment rate for the Medicaid-defined geographic area to
this weighted average of Medicare payment rates. Alternatively, as
discussed in the next paragraph, the State could determine to use the
unweighted arithmetic mean of the two Medicare payment rates applicable
within the Medicaid-defined geographic area. We are seeking public
comment on the proposed use of Medicare non-facility payment rates as
listed on the Medicare PFS as a benchmark for States to compare their
Medicaid payment rates to in the comparative payment rate analysis
requirements in proposed Sec. 447.203(b)(3)(i) to help assess if
Medicaid 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.
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\171\ https://www.census.gov/programs-surveys/metro-micro/about/delineation-files.html.
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We are aware that States may not determine their payment rates by
geographical location. For States that do not pay Medicaid payment
rates based on geographical location, we propose that States compare
their Medicaid payment rates (separately identified by population,
pediatric and adult, and provider type, as applicable) to the Statewide
average of Medicare non-facility payment rates as listed on the
Medicare PFS for a particular CPT/HCPCS code. The Statewide average of
the Medicare non-facility payment rates as listed on the Medicare PFS
for a particular CPT/HCPCS code would be calculated as a simple average
or arithmetic mean where all Medicare non-facility payment rates as
listed on the Medicare PFS for a particular CPT/HCPCS code for a
particular State would be summed and divided by the number of all
Medicare non-facility payment rates as listed on the Medicare PFS for a
particular CPT/HCPCS code for a particular State. This calculated
Statewide average of the Medicare non-facility payment rates as listed
on the Medicare PFS would be calculated for each CPT/HCPCS code subject
to the comparative payment rate analysis using the Non-Facility Price
for each locality in the State rates as listed on the Medicare PFS. As
previously mentioned, Medicare has published a listing of the current
PFS locality structure organized by State, locality area, and when
applicable, counties assigned to each locality area and we would expect
States to utilize this listing to identify the Medicare locality areas
in their State. For example, the Specific Medicare Administrative
Contractor (MAC) for Maryland is 12302 and there are two Specific
Locality codes, 1230201 for BALTIMORE/SURR. CNTYS and 1230299 for REST
OF STATE. When using the Medicare Physician Fee Schedule Look Up Tool
to identify the Medicare Non-Facility Price(s) for CY 2023 for 99202 in
the Specific MAC locality code for Maryland (12302 MARYLAND), the
following search results are populated: Medicare Non-Facility Price of
$77.82 for BALTIMORE/SURR. CNTYS and $74.31 for REST OF STATE.\172\
These two Medicare Non-Facility Price(s) would be averaged to obtain a
calculated Statewide average for Maryland of $76.07.
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\172\ https://www.cms.gov/medicare/physician-fee-schedule/search?Y=0&T=4&HT=0&CT=1&H1=99202&C=43&M=5.
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For States that do not determine their payment rates by
geographical location, we propose that States would use the Statewide
average of the Medicare Non-Facility Price(s) as listed on the PFS, as
previously described, because it ensures consistency across all States'
comparative payment rate analysis,
[[Page 28014]]
aligns with the geographic area requirement of section 1902(a)(30)(A)
of the Act, and ensures the Medicare non-facility payment rates as
listed on the Medicare PFS that States use in their comparative payment
rate analysis accurately reflect how Medicare pays for services. This
proposal ensures that all States' comparative payment rate analyses
consistently incorporate Medicare geographical payment rate adjustments
as proposed in paragraph (b)(3)(i)(C). As previously discussed, we
propose that States that do pay varying rates by geographical location
would need to identify the comparable Medicare locality area for the
same geographical area as their Medicaid base payment rates. However,
for States that do not pay varying rates by geographical location, at
the operational level, the State is effectively paying a Statewide
Medicaid payment rate, regardless of geographical location, that cannot
be matched to a Medicare non-facility payment rate in a comparable
Medicare locality area for the same geographical area as the Medicaid
base payment rates. Therefore, in order consistently apply the proposed
provision that the Medicare non-facility payment rate must be for the
same geographical location as the Medicaid base payment rates, States
that do not pay varying rates by geographical location would be
required to calculate a Statewide average of the Medicare non-facility
payment rate to compare the State's Statewide Medicaid payment rate.
Additionally, we propose that States that do not determine their
payment rates by geographical location should use the Statewide average
of the Medicare non-facility payment rates as listed on the Medicare
PFS to align the implementing regulatory text with the statute's
geographic area requirement in section 1902(a)(30)(A) of the Act.
Section 1902(a)(30)(A) of the Act requires that Medicaid payments 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. Therefore, the proposed provisions of this rule, which are
implementing section 1902(a)(30)(A) of the Act, must include a method
of ensuring we have sufficient information for determining sufficiency
of access to care as compared to the general population in the
geographic area. As we have proposed to use Medicare non-facility
payment rates as a benchmark for comparing Medicaid base payment rates,
we believe that utilizing a Statewide average of Medicare non-facility
payment rates as listed on the Medicare PFS for States that do not pay
varying rates by geographical location would align the geographic area
requirement of section 1902(a)(30)(A) of the Act, treating the entire
State (throughout which the Medicaid base payment rate applies
uniformly) as the relevant geographic area.
We considered requiring States weight the Statewide average of the
Medicare non-facility payment rates by the proportion of the Medicare
beneficiary population covered by each rate, but we did not propose
this due to the additional administrative burden this would create for
States complying with the proposed comparative payment rate analysis as
well as limited availability of Medicare beneficiary and claims data
necessary to weight the Statewide average of the Medicare non-facility
payment rates as described above. As proposed, States that do not
determine their payment rates by geographical location would be
required to consider Medicare's geographically determined payment rates
by Statewide average of the Medicare non-facility payment rates. We
believe that proposing an additional step to weight the Statewide
average by the proportion of the Medicare beneficiary population
covered by each rate would create would not result in a practical
version of the Medicare non-facility payment rate for purposes of the
comparative payment rate analysis. Additionally, proposing only States
that do not determine their payment rates by geographical location
would result in additional administrative burden that is not imposed on
States who do determine their payment rates by geographical location.
Additionally, in order to accurately weight the Statewide average of
the Medicare non-facility payment rates by the proportion of the
Medicare beneficiary population covered by each rate, States would
likely require Medicare-paid claims data for each code subject to the
comparative payment rate analysis, broken down by each of the
comparable Medicare locality areas for the same geographical area as
the Medicaid base payment rates that are included in the Statewide
average of Medicare non-facility payment rates. While total Medicare
beneficiary enrollment data broke down by State and county level is
publicly available on data.cms.gov, Medicare-paid claims data broken
down by the Medicare locality areas used in the Medicare PFS and by
code level is not published by CMS and would be inaccessible for the
State to utilize in weighting the Statewide average of the Medicare
non-facility payment rates by the proportion of the Medicare
beneficiary population covered by each rate. As proposed, we believe
that States that do not determine their payment rates by geographical
location calculating simple Statewide average of the Medicare non-
facility rates in their State ensures consistency across all States'
comparative payment rate analysis, aligns with the geographic area
requirement of section 1902(a)(30)(A) of the Act, and ensures the
Medicare non facility payment rates as listed on the Medicare PFS that
States use in their comparative payment rate analysis accurately
reflect how Medicare pays for services. We are seeking public comment
regarding our decision not to propose requiring States that do not pay
varying Medicaid rates by geographical location weight the Statewide
average of the Medicare non-facility payment rates by the distribution
of Medicare beneficiaries in the State.
Furthermore, in paragraph (b)(3)(i)(C), we propose that the
Medicare non-facility payment rate must separately identify the payment
rates by provider type. We previously discussed that some States and
Medicare pay a percentage less than 100 percent of their fee schedule
payment rates to NPPs, including, for example, nurse practitioners,
physician assistants, and clinical nurse specialists. To ensure a
State's comparative payment rate analysis is as accurate as possible
when comparing their Medicaid payment rates to Medicare, we are
proposing that States include a breakdown of Medicare's non-facility
payment rates by provider type. The proposed breakdown of Medicare's
payment rates by provider type would be required for all States,
regardless of whether or how the State's Medicaid payment rates vary by
provider type, because it ensures the comparative payment rate analysis
accurately reflects this existing Medicare payment policy on the
Medicare side of the analysis. Therefore, every comparative payment
rate analysis would include the following Medicare non-facility payment
rates for the same set of E/M CPT/HCPCS codes paid under Medicaid as
described in Sec. 447.203(b)(3)(i)(B): the non-facility payment rate
as listed on Medicare PFS rate as the Medicare payment rate for
physicians and the non-facility payment rate as listed on Medicare PFS
rate multiplied by 0.85 as the Medicare payment rate for NPPs.
As previously mentioned in this proposed rule, Medicare pays nurse
practitioners, physician assistants, and clinical nurse specialists at
85 percent of the Medicare PFS rate. Medicare
[[Page 28015]]
implements a payment policy where the fee schedule amounts, including
the Medicare non facility payment rates, as listed on the Medicare PFS
are reduced to 85 percent when billed by NPPs, including nurse
practitioners, physician assistants, and clinical nurse specialists,
whereas physicians are paid 100 percent of the fee schedule amounts as
listed on the Medicare PFS.\173\ As proposed, States' comparative
payment rate analysis would need to match their Medicaid payment rates
for each provider type to the corresponding Medicare non-facility
payment rates for each provider type, regardless of the State paying
varying or the same payment rates to their providers for the same
service. As an example of a State that pays varying rates based on
provider type, if a State's Medicaid fee schedule lists a rate of
$100.00 when a physician delivers and bills for 99202, then the $100.00
Medicaid base payment rate would be compared to 100 percent of the
Medicare non-facility payment rate as listed on the Medicare PFS. If
the same State's Medicaid fee schedule lists a rate of $75 when a nurse
practitioner delivers and bills for 99202 (or the State's current
approved State plan language states that a nurse practitioner is paid
75 percent of the State's Medicaid fee schedule rate), then the $75
Medicaid base payment rate would be compared to the Medicare non-
facility payment rate as listed on the Medicare PFS multiplied by 0.85.
Both Medicare non-facility payments rates would need to account for any
applicable geographical variation, including the Non-Facility Price as
listed on the Medicare PFS for each relevant locality area or the
calculated Statewide average of the Non-Facility Price as listed on the
Medicare PFS for all relevant areas of a State, as previously discussed
in this section, for an accurate comparison to the corresponding
Medicaid payment rate. Alternatively, if a State pays the same $80
Medicaid base payment rate for the service when delivered by physicians
and by nurse practitioners, then the $80 would be listed separately for
physicians and nurse practitioners as the Medicaid base payment rate
and compared to the Medicare non-facility payment rate as listed on the
Medicare PFS for physicians and the Medicare non-facility payment rate
as listed on the Medicare PFS multiplied by 0.85 for nurse
practitioners.
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\173\ https://www.cms.gov/files/document/physician-fee-schedule-guide.pdf.
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This granular level of comparison provides States with the
opportunity to benchmark their Medicaid payment rates against Medicare
as part of the State's and our process for ensuring compliance with
section 1902(a)(30)(A) of the Act. For example, a State's comparative
payment rate analysis may show that the State's Medicaid base payment
rate for physicians is 80 percent of the Medicare non-facility payment
rate and their Medicaid base payment rate for nurse practitioners is 71
percent of the Medicare non-facility payment rate for NPPs, because the
State pays a reduced rate to nurse practitioners. Although Medicare
also pays a reduced rate to nurse practitioners, the reduced rate the
State pays to nurse practitioners compared to Medicare's reduced rate
is still a lower percentage than the physician rate. However, another
State's comparative payment rate analysis may show that the State's
Medicaid base payment rate for physicians is 95 percent of the Medicare
non-facility payment rate and their Medicaid base payment rate for
nurse practitioners is 110 percent of the Medicare non-facility payment
rate because the State pays all providers the same Medicaid base
payment rate while Medicare pays a reduced rate of 85 percent of the
Medicare non-facility payment rate as listed on the Medicare PFS when
the service is furnished by an NPP. By conducting this level of
analysis through the comparative payment rate analysis, States would be
able to pinpoint where there may be existing or potential future access
to care concerns rooted in payment rates. We are seeking public comment
on the proposed requirement for States to compare their Medicaid
payment rates to the Medicare non-facility payment rate as listed on
the Medicare PFS, effective for the same time period for the same set
of E/M CPT/HCPCS codes, and for the same geographical location as the
Medicaid base payment rates, that correspond to the Medicaid base
payment rates identified under paragraph (b)(3)(i)(B) of this section,
including, separate identification of the payment rates by provider
type, as proposed in Sec. 447.203(b)(3)(i)(C).
In paragraph (b)(3)(i)(D), we propose to require States specify the
Medicaid base payment rate identified under proposed Sec.
447.203(b)(3)(i)(B) as a percentage of the Medicare non-facility
payment rate identified under proposed Sec. 447.203(b)(3)(i)(C) for
each of the services for which the Medicaid base payment rate is
published under proposed Sec. 447.203(b)(3)(i)(B). For each E/M CPT/
HCPCS code that we select, we propose that States would calculate each
Medicaid base payment rate as specified in paragraph (b)(3)(i)(B) as a
percentage of the corresponding Medicare non-facility payment rate
specified in paragraph (b)(3)(i)(C). Both rates would be required to be
effective for the same time period of the comparative payment rate
analysis. As previous components of the proposed comparative payment
rate analysis have considered variance in payment rates based on
population the service is delivered to (adult or pediatric), provider
type, and geographical location to extract the most granular and
accurate Medicaid and Medicare payment rate data, we propose that
States would calculate the Medicaid base payment rate as a percentage
of the Medicare non-facility payment rate in the comparative payment
rate analysis to obtain an informative metric that can be used in the
State's and our assessment of whether the State's payment rates are
compliant with section 1902(a)(30)(A) of the Act. As previously
discussed, benchmarking against Medicare serves as an important data
point in determining whether payment rates are likely to be sufficient
to ensure access for Medicaid beneficiaries at least as great as for
the general population in the geographic area, and whether any
identified access concerns may be related to payment sufficiency. We
propose that States would calculate their Medicaid payment rates as a
percentage of the Medicare non-facility payment rate because it is a
common, simple, and informative statistic that can provide us with a
gauge of how Medicaid payment rates compare to Medicare non-facility
payment rates in the same geographic area. Initially and over time,
States, CMS, and other interested parties would be able to compare the
State's Medicaid payment rates as a percentage of Medicare's non-
facility payment rates to identify how the percentage changes over
time, in view of changes that may take place to the Medicaid and/or the
Medicare payment rate. Being able to track and analyze the change in
percentage over time would help States and CMS identify possible access
concerns that may be related to payment insufficiency.
The organization and content of the comparative payment rate
analysis, including the expression of the Medicaid base payment rate as
a percentage of the Medicare payment rate, can provide us with a great
deal of information about access in the State. For example, we would be
able to identify when and how the Medicaid base payment rate as a
percentage of the Medicare non-facility payment rate for E/M CPT/HCPCS
codes for primary care
[[Page 28016]]
services may decrease over time if Medicare adjusts its rates and a
State does not, and use this information to more closely examine for
possible access concerns. This type of analysis would provide us with
actionable information to help ensure consistency with section
1902(a)(30)(A) of the Act by using Medicare non-facility payment rates
paid across the same geographical areas of the State as a point of
comparison for payment rate sufficiency as a critical element of
beneficiary access to care. When explaining the rationale for proposing
to use Medicare non-facility payment rates for comparison earlier in
this rule, we emphasized the ability to demonstrate to States that
certain Medicaid payment rates have not kept pace with changes to
Medicare non-facility payment rates and how the comparative payment
rate analysis would help them identify areas where they also might want
to consider rate increases that address market changes. We are seeking
public comment on the proposed requirement for States to calculate
their Medicaid payment rates as a percentage of the Medicare non-
facility payment rate for each of the services for which the Medicaid
base payment rate is published under proposed paragraph (b)(3)(i)(B),
as described in proposed Sec. 447.203(b)(3)(i)(D). We are also seeking
public comment on any challenges States might encounter when comparing
their Medicaid payment rates to Medicare non-facility payment rates
under proposed Sec. 447.203(b)(3)(i)(D), particularly for any of the
proposed categories of service in paragraphs (b)(2)(i) through (iii),
as well as suggestions for an alternative comparative analysis that
might be more helpful, or less burdensome and equally helpful, for
States, CMS, and other interested parties to assess whether a State's
Medicaid payment rates are consistent with the access standard in
section 1902(a)(30)(A) of the Act.
We are aware that provider payment rates are an important factor
influencing beneficiary access; as expressly indicated in section
1902(a)(30)(A) of the Act, insufficient provider payment rates are not
likely to enlist enough providers willing to serve Medicaid
beneficiaries to ensure broad access to care; however, there may be
situations where access issues are principally due to other causes. For
example, even if Medicaid payment rates are generally consistent with
amounts paid by Medicare (and those amounts have been sufficient to
ensure broad access to services for Medicare beneficiaries), Medicaid
beneficiaries may have difficulty scheduling behavioral health care
appointments because the overall number of behavioral health providers
within a State is not sufficient to meet the demands of the general
population. Therefore, a State's rates may be consistent with the
requirements of section 1902(a)(30)(A) of the Act even when access
concerns exist, and States and CMS may need to examine other strategies
to improve access to care beyond payment rate increases. By contrast,
comparing a State's Medicaid behavioral health payment rates to
Medicare may demonstrate that the State's rates fall far below Medicare
non-facility payment rates, which would likely impede beneficiaries
from accessing needed care when the demand already exceeds the supply
of providers within a State. In that case, States may need to evaluate
budget priorities and take steps to ensure behavioral health rates are
consistent with section 1902(a)(30)(A) of the Act.
Lastly, in paragraph (b)(3)(i)(E), we propose to require States to
specify in their comparative payment rate analyses the number of
Medicaid-paid claims and the number of Medicaid enrolled beneficiaries
who received a service within a calendar year for each of the services
for which the Medicaid base payment rate is published under paragraph
(b)(3)(i)(B). The previous components of the comparative payment rate
analysis focus on the State's payment rate for the E/M CPT/HCPCS code
and comparing the Medicaid base payment rate to the Medicare non-
facility payment rate for the same code (separately, for each Medicaid
base payment rate by population (adult or pediatric), provider type,
and geographic area, as applicable). This component examines the
Medicaid-paid claims volume of each E/M CPT/HCPCS code included in the
comparative payment rate analysis relative to the number of Medicaid
enrolled beneficiaries receiving each service within a calendar year.
We propose to limit the claims volume data to Medicaid-paid claims, and
the number of beneficiaries would be limited to Medicaid-enrolled
beneficiaries who received a service in the calendar year of the
comparative payment rate analysis, where the service would fall into
the list of CMS-identified E/M CPT/HCPCS code(s). In other words, a
beneficiary would be counted in the comparative payment rate analysis
for a particular calendar year when the beneficiary received a service
that is included in one of the categories of services described in
paragraphs (b)(2)(i) through (iii) for which the State has a Medicaid-
based payment rate (the number of Medicaid-enrolled beneficiaries who
received a service). A claim would be counted in the comparative
payment rate analysis for a particular calendar year when that
beneficiary had a claim submitted on their behalf by a provider who
billed one of the codes from the list of CMS-identified E/M CPT/HCPCS
code(s) to the State and the State paid the claim (number of Medicaid-
paid claims). With this proposal, we are seeking to ensure the
comparative payment rate analysis reflects actual services received by
beneficiaries and paid for by the State, or realized access.\174\
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\174\ Andersen, R.M., and P.L. Davidson. 2007. Improving access
to care in America: Individual and contextual indicators. In
Changing the U.S. health care system: Key issues in health services
policy and management, 3rd edition, Andersen, R.M., T.H. Rice, and
G.F. Kominski, eds. San Francisco, CA: John Wiley & Sons.
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We considered but did not propose States identify the number of
unique Medicaid-paid claims and the number of unique Medicaid-enrolled
beneficiaries who received a service within a calendar year for each of
the services for which the Medicaid base payment rate is published
pursuant to paragraph (b)(3)(i)(B). We considered this detail in order
to identify the unique, or deduplicated, number of beneficiaries who
received a service that falls into one of the categories of services
described in in paragraph (b)(2)(i) through (iii) in a calendar year.
For example, if a beneficiary has 6 visits to their primary care
provider in a calendar year and the provider bills 6 claims with 99202
for the same beneficiary, then the beneficiary and claims for 99202
would only be counted as one claim and one beneficiary. Therefore, we
chose not to propose this aspect because we intend for the comparative
payment rate analysis to capture the total amount of actual services
received by beneficiaries and paid for by the State. We are seeking
public comment regarding our decision not to propose States identify
the number of unique Medicaid-paid claims and the number of unique
Medicaid enrolled beneficiaries who received a service within a
calendar year for each of the services for which the Medicaid base
payment rate is published pursuant to paragraph (b)(3)(i)(B) in
comparative payment rate analysis as proposed Sec.
447.203(b)(3)(i)(E).
We also considered but did not propose States identify the total
Medicaid-enrolled population who could potentially receive a service
within a calendar year for each of the services for which the Medicaid
base
[[Page 28017]]
payment rate is published pursuant to paragraph (b)(3)(i)(B), in
addition to the proposing States identify the number of Medicaid-
enrolled beneficiaries who received a service. This additional data
element in the comparative payment rate analysis would reflect the
number of Medicaid-enrolled beneficiaries who could have received a
service, or potential access, in comparison to the number of Medicaid-
enrolled beneficiaries who actually received a service. We did not
propose this aspect because this could result in additional
administrative burden on the State, as we already collect and publish
similar data through Medicaid and CHIP Enrollment Trends Snapshots
published on Medicaid.gov. We are also seeking public comment regarding
our decision not to propose States identify the total Medicaid-enrolled
population who could receive a service within a calendar year for each
of the services for each of the services for each of the services for
which the Medicaid base payment rate is published pursuant to paragraph
(b)(3)(i)(B) in the comparative payment rate analysis as proposed Sec.
447.203(b)(3)(i)(E).
We propose to include beneficiary and claims information in the
comparative payment rate analysis to contextualize the payment rates in
the analysis, and to be able to identify longitudinal changes in
Medicaid service volume in the context of the Medicaid beneficiary
population receiving services, since utilization changes could be an
indication of an access to care issue. For example, a decrease in the
number of Medicaid-paid claims for primary care services furnished to
Medicaid beneficiaries in an area (when the number of Medicaid-enrolled
beneficiaries who received primary care services in the area is
constant or increasing) could be an indication of an access to care
issue. Without additional context provided by the number of Medicaid
enrolled beneficiaries who received a service, changes in claims volume
could be attributed to a variety of changes in the beneficiary
population, such as a temporary loss of coverage when enrollees
disenroll and then re-enroll within a short period of time.
Further, if the Medicaid base payment rate for the services with
decreasing Medicaid service volume has failed to keep pace with the
corresponding Medicare non-facility payment rate over the period of
decrease in utilization (as reflected in changes in the Medicaid base
payment rate expressed as a percentage of the Medicare non-facility
payment rate as required under proposed Sec. 447.203(b)(3)(i)(D)),
then we would be concerned and would further scrutinize whether any
access to care issue might be caused by insufficient Medicaid payment
rates for the relevant services. With each biennial publication of the
State's comparative payment rate analysis, as proposed in Sec.
447.203(b)(4), discussed later in this section, States and CMS would be
able to compare the number of paid claims in the context of the number
of Medicaid enrolled beneficiaries receiving services within a calendar
year for the services subject to the comparative payment rate analysis
with previous years' comparative payment rate analyses. Collecting and
comparing the number of paid claims data in the context of the number
of Medicaid enrolled beneficiaries receiving services alongside
Medicaid base payment rate data may reveal trends where an increase in
the Medicaid base payment rate is correlated with an increase in
service volume and utilization, or vice versa with a decrease in the
Medicaid base payment rate is correlated with a decrease in service
volume and utilization. As claims utilization and number of Medicaid
enrolled beneficiaries receiving services are only correlating trends,
we acknowledge that there may be other contextualizing factors outside
of the comparative payment rate analysis that affect changes in service
volume and utilization and we would (and would expect States and other
interested parties to) take such additional factors into account in
analyzing and ascribing significance to changes in service volume and
utilization. We are seeking public comment on the proposed requirement
for States to include the number of Medicaid-paid claims and the number
of Medicaid enrolled beneficiaries who received a service within a
calendar year for which the Medicaid base payment rate is published
under proposed paragraph (b)(3)(i)(B), as specified in proposed Sec.
447.203(b)(3)(i)(E).
We believe the comparative payment rate analysis proposed in
paragraph (b)(3) is needed to best enable us to ensure State compliance
with the requirement in section 1902(a)(30)(A) of the Act that payments
are sufficient to enlist enough providers so that care and services are
available to Medicaid beneficiaries at least to the extent they are
available to the general population in the geographic area. As
demonstrated by the findings of Sloan, et al.,\175\ which have since
been supported and expanded upon by numerous researchers, multiple
studies examining the relationship between Medicaid payment and
physician participation,176 177 at the State level,\178\ and
among specific provider types,179 180 have found a direct,
positive association between Medicaid payment rates and provider
participation in the Medicaid program. While multiple factors may
influence provider enrollment (such as administrative burden), section
1902(a)(30)(A) of the Act specifically concerns the sufficiency of
provider payment rates. Given this statutory requirement, a comparison
of Medicaid payment rates to other payer rates is an important
barometer of whether State payment policies are likely to support the
statutory standard of ensuring access for Medicaid beneficiaries such
that covered care and services are available to them at least to the
extent that the same care and services are available to the general
population in the geographic area.
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\175\ Sloan, F. et al. ``Physician Participation in State
Medicaid Programs.'' The Journal of Human Resources, Volume 13,
Supplement: National Bureau of Economic Research Conference on the
Economics of Physician and Patient Behavior, 1978, p. 211-245.
https://www.jstor.org/stable/145253?seq=1#metadata_info_tab_contents. Accessed August 16, 2022.
\176\ Chen, A. ``Do the Poor Benefit from More Generous Medicaid
Policies'' SSRN Electronic Journal, January 2014., p. 1-46. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2444286. Accessed June
16, 2022.
\177\ Holgash, K. and Martha Heberlein, ``Physician Acceptance
of New Medicaid Patients: What Matters and What Doesn't'' Health
Affairs, April 10, 2019. https://www.healthaffairs.org/do/10.1377/
forefront.20190401.678690/#:~:text=Physicians%
E2%80%99%20acceptance%20of%20new
%20Medicaid%20patients%20is%20only,of%20Medicaid%20patients%20already
%20in%20the%20physician%E2%80%99s%20care. Accessed June 16, 2022.
\178\ Fakhraei, H. ``Payments for Physician Services: An
analysis of Maryland Medicaid Reimbursement Rates'' International
Journal of Healthcare Technology and Management, Volume 7, Numbers
1-2, January 2005, p. 129-142. https://www.researchgate.net/publication/228637758_Payments_for_physician_services_An_analysis_of_Maryland_Medicaid_reimbursement_rates. Accessed June 16, 2022.
\179\ Berman, S., et al. ``Factors that Influence the
Willingness of Private Primary Care Pediatricians to Accept More
Medicaid Patients,'' Pediatrics, Volume 110, Issue 2, August 2002,
p. 239-248. https://publications.aap.org/pediatrics/article-abstract/110/2/239/64380/Factors-That-Influence-the-Willingness-of-Private?redirectedFrom=fulltext?autologincheck=redirected. Accessed
June 16, 2022.
\180\ Suk-fong S., Tang, et al. ``Increased Medicaid Payment and
Participation by Office-Based Primary Care Pediatricians,''
Pediatrics, Volume 141, number 1, January 2018, p. 1-9. https://publications.aap.org/pediatrics/article/141/1/e20172570/37705/Increased-Medicaid-Payment-and-Participation-by. Accessed June 16,
2022.
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The AMRP requirements currently address this standard under section
1902(a)(30)(A) of the Act by requiring States to compare Medicaid
payment rates to the payment rates of other
[[Page 28018]]
public and private payers in current Sec. 447.203(b)(1)(v) and (b)(3).
While we are proposing to eliminate the AMRP requirements with this
proposed rule, we believe that our proposal to require States to
compare their Medicaid payment rates for services under specified E/M
CPT/HCPCS codes against Medicare non-facility payment rates for the
same codes, as described in Sec. 447.203(b)(3), would well position
States and CMS to continue to meet the statutory access requirement.
Some studies examining the relationship between provider payments and
various access measures have quantified the relationship between the
Medicaid-Medicare payment ratio and access measures. Two studies
observed that increases in the Medicaid-Medicare payment ratio is
associated with higher physician acceptance rates of new Medicaid
patients and with an increased probability of a beneficiary having an
office-based physician as the patient's usual source of
care.181 182 These studies led us to conclude that Medicare
non-facility payment rates are likely to be a sufficient benchmark for
evaluating access to care, particularly ambulatory physician services,
based on provider payment rates.
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\181\ Holgash, K. and Martha Heberlein, Health Affairs, April
10, 2019.
\182\ Cohen, J.W., Inquiry, Fall 1993.
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By comparing FFS Medicaid payment rates to corresponding FFS
Medicare non-facility payment rates, where Medicare is a public payer
with large populations of beneficiaries and participating providers
whose payment rates are readily available, we aim to establish a
uniform benchmarking approach that allows for more meaningful oversight
and transparency and reduces the burden on States and CMS relative to
the current AMRP requirements that do not impose specific
methodological standards for comparing payment rates and that
contemplate the availability of private payer rate information that has
proven difficult for States to obtain due to its often proprietary
nature. This aspect of the proposal specifically responds to States'
expressed concerns that the AMRP requirement to include ``actual or
estimated levels of provider payment available from other payers,
including other public and private payers'' was challenging to
accomplish based on the general unavailability of this information, as
discussed elsewhere in this proposed rule.
Following the 2011 proposed rule, and as addressed by us through
public comment response in the 2015 final rule with comment period,
States expressed concerns that private payer payment rates were
proprietary information and not available to them and that large
private plans did not exist within some States so there were no private
payer rates to compare to, therefore, the State would need to rely on
State employee health plans or non-profit insurer rates.\183\ States
also expressed that other payer data, including public and private
payers, in general may be unsound for comparisons because of a lack of
transparency about the payment data States would have compared their
Medicaid payment rates to. Since 2016, we have learned a great deal
from our implementation experience of the AMRP process. We have learned
that very few States were able to include even limited private payer
data in their AMRPs. States that were able include private payer data
were only able to do so because the State had existing Statewide all
payer claiming or rate-setting systems, which gave them access to
private payer data in their State, or the State previously based their
State plan payment rates off of information about other payers (such as
the American Dental Association's Survey of Dental Fees) that gave them
access to private payer data.\184\ Based on our implementation
experience and concerns from States about the current requirement in
Sec. 447.203(b)(1)(v) to obtain private payer data, we are proposing
to require States only compare their Medicaid payment rates to
Medicare's, for which payment data are readily and publicly available.
---------------------------------------------------------------------------
\183\ Alaska Department of Health and Social Services, Comment
Letter on 2011 Proposed Rule (July 7, 2011), https://www.regulations.gov/comment/CMS-2011-0062-0102.
\184\ https://www.medicaid.gov/sites/default/files/2019-12/co-amrp-2016.pdf, https://www.medicaid.gov/sites/default/files/2019-12/md-amrp-16.pdf, https://www.medicaid.gov/sites/default/files/2019-12/sd-amrp-16.pdf.
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Next, in paragraph (b)(3)(ii), we propose that for each category of
services described in proposed paragraph (b)(2)(iv), the State agency
would be required to publish a payment rate disclosure that expresses
the State's payment rates as the average hourly payment rates,
separately identified for payments made to individual providers and to
providers employed by an agency, if the rates differ. The payment rate
disclosure would be required to meet specified requirements. The reason
for including this proposal builds on our justification for including
personal care, home health aide, and homemaker services provided by
individual providers and providers employed by an agency in this
proposed rule, which is to remain consistent with the proposed HCBS
provisions at Sec. 441.311(d)(2) and (e) and take specific action
regarding direct care workers per Section 2402(a) of the Affordable
Care Act. HCBS and direct care workers that deliver these services are
unique to Medicaid and often not covered by other payers, which is why
we are proposing a different analysis of payment rates for providers of
these services that does not involve a comparison to Medicare. As
previously stated, Medicare covers part-time or intermittent home
health aide services (only if a Medicare beneficiary is also getting
other skilled services like nursing and/or therapy at the same time)
under Medicare Part A (Hospital Insurance) or Medicare Part B (Medical
Insurance); however, Medicare does not cover personal care or homemaker
services. Therefore, comparing personal care and homemaker services to
Medicare, as we proposed in paragraph (b)(3)(i) for other specified
categories of services, would not be feasible for States, and a
comparison of Medicaid home health aide average hourly payment rates to
analogous rates for Medicare would be of limited utility given the
differences in circumstances when Medicaid and Medicare may pay for
such services.
As previously discussed, private payer data are often considered
proprietary and not available to States, thereby eliminating private
payers as feasible point of comparison. Even if private payer payment
rate data were more readily available, like Medicare, many private
payers do not cover HCBS as HCBS is unique to the Medicaid program,
leaving Medicaid as the largest or the only payer for personal care,
home health aide, and homemaker services. Given Medicaid's status as
the most important payer for HCBS, we believe that scrutiny of Medicaid
HCBS payment rates themselves, rather than a comparison to other payer
rates that frequently do not exist, is most important in ascertaining
whether such Medicaid payment rates are sufficient to enlist adequate
providers so that the specified services are available to Medicaid
beneficiaries at least to the same extent as to the general population
in the geographic area. We acknowledge that individuals without
insurance may self-pay for medical services provided in their home or
community; however, similar to private payer data, self-pay data is
unlikely to be available to States. Because HCBS coverage is unique to
Medicaid, Medicaid beneficiaries are generally the only individuals in
a given geographic area with access to HCBS. Through the proposed
payment rate disclosure, Medicaid payments rates
[[Page 28019]]
would be transparent and comparable among States and would assist
States to analyze if and how their payment rates are compliant with
section 1902(a)(30)(A) of the Act.
As noted previously in this section, we propose to require States
to express their rates separately as the average hourly payments made
to individual providers and providers employed by an agency, if the
rates differ, as applicable for each category of service specified in
proposed Sec. 447.203(b)(2)(iv). We believe expressing the data in
this manner would best account for variations in types and levels of
payment that may occur in different settings and employment
arrangements. Individual providers are often self-employed or contract
directly with the State to deliver services as a Medicaid provider
while providers employed by an agency are employed by the agency which
works directly with the Medicaid agency to provide Medicaid services.
These differences in employment arrangements often include differences
in the hourly rate a provider would receive for services delivered, for
example, providers employed by an agency typically receive benefits,
such as health insurance, and the cost of those benefits are factored
into the hourly rate that the State pays for the services delivered by
providers employed by an agency (even though the employed provider does
not retain the entire amount as direct monetary compensation). However,
these benefits are not always available for individual providers who
may need to separately purchase a marketplace health plan or be able to
opt into the State-employee health plan, for example. Therefore, the
provider employed by an agency potentially could receive a higher
hourly rate because benefits are factored into the hourly rate they
receive for delivering services, whereas the individual provider might
be paid a rate that does not reflect employment benefits.
With States expressing their payment rates separately as the
average hourly payment rate made to individual and agency employed
providers for personal care, home health aide, and homemaker services,
States, CMS, and other interested parties would be able to compare
payment rates among State Medicaid programs. Such comparisons may be
particularly relevant for States in close geographical proximity to
each other or that otherwise may compete to attract providers of the
services specified in proposed paragraph (b)(2)(iv) or where such
providers may experience similar costs or other incentives to provide
such services. For example, from reviewing all States' payment rate
analyses for personal care, home health aide, and homemaker services,
we would be able to learn that two neighboring States have similar
hourly rates for providers of these services, but a third neighboring
State has much lower hourly rates than both of its neighbors. This
information could highlight a potential access issue, since providers
in the third State might have an economic incentive to move to one of
the two neighboring States where they could receive higher payments for
furnishing the same services. Such movement could result in
beneficiaries in the third State having difficulty accessing covered
services, compared to the general population in the tri-State
geographic area.
Additionally in paragraph (b)(3)(ii), we propose that the State's
payment rate disclosure must meet the following requirements: (A) the
State must organize the payment rate disclosure by category of service
as specified in proposed paragraph (b)(2)(iv); (B) the disclosure must
identify the average hourly payment rates, including, if the rates
vary, separate identification of the average hourly payment rates for
payments made to individual providers and to providers employed by an
agency by population (pediatric and adult), provider type, and
geographical location, as applicable; and (C) the disclosure must
identify the number of Medicaid-paid claims and the number of Medicaid
enrolled beneficiaries who received a service within a calendar year
for each of the services for which the Medicaid base payment rate is
published under proposed paragraph (b)(3)(ii)(B). We are seeking public
comment on the proposed requirements and content of the items in
proposed Sec. 447.203(b)(3)(ii)(A) through (C).
In paragraph (b)(3)(ii)(A), we propose to require States to
organize their payment rate disclosures by each of the categories of
services specified in proposed paragraph (b)(2)(iv), that is, to break
out the payment rates for personal care, home health aide, and
homemaker services provided by individual providers and providers
employed by an agency, separately for individual analyses of the
payment rates for each category of service and type of employment
structure. We are seeking public comment on the proposed requirement
for States to break out their payment rates for personal care, home
health aide, and homemaker services separately for individual analyses
of the payment rates for each category of service in the comparative
payment rate analysis, as described in proposed Sec.
447.203(b)(3)(ii)(A).
In paragraph (b)(3)(ii)(B), we propose to require States identify
in their disclosure the Medicaid average hourly payment rates by
applicable category of service, including, if the rates vary, separate
identification of the average hourly payment rates for payments made to
individual providers and to providers employed by an agency, as well as
by population (pediatric and adult), provider type, and geographical
location, as applicable. Given that direct care workers deliver unique
services in Medicaid that are often not covered by other payers, we are
proposing to require a payment rate disclosure, instead of comparative
payment rate analysis. To be clear, we are not proposing to require a
State's payment rate disclosure for personal care, home health aide,
and homemaker services be broken down and organized by E/M CPT/HCPCS
codes, nor are we proposing States compare their Medicaid payment rates
to Medicare for these services.
We propose to require States calculate their Medicaid average
hourly payment rates made to providers of personal care, home health
aide, and homemaker services, separately, for each of these categories
of services, by provider employment structures (individual providers
and agency employed providers). For each of the categories of services
in paragraph (b)(3)(ii)(A), one Medicaid average hourly payment rate
would be calculated as a simple average or arithmetic mean where all
payment rates would be adjusted to an hourly figure, summed, then
divided by the number of all hourly payment rates. As an example, the
State's Medicaid average hourly payment rate for personal care
providers may be $10.50 while the average hourly payment rate for a
home health aide is $15.00. A more granular analysis may show that
within personal care providers receiving a payment rate of $10.50, an
individual personal care provider is paid an average hourly payment
rate of $9.00, while a personal care provider employed by an agency is
paid an average hourly payment rate of $12.00 for the same type of
service. Similarly for home health aides, a more granular analysis may
show that within home health aides receiving a payment rate of $15.00,
an individual home health aide is paid an average hourly payment rate
of $13.00, while a home health aide employed by an agency is paid an
average hourly payment rate of $17.00.
We understand that States may set payment rates for personal care,
home health aide, and homemaker services based on a particular unit of
time for delivering the service, and that time
[[Page 28020]]
may not be in hourly increments. For example, different States might
pay for personal care services using 15-minute increments, on an hourly
basis, through a daily rate, or based on a 24-hour period. By proposing
to require States to represent their rates as an hourly payment rate,
we would be able to standardize the unit (hourly) and payment rate for
comparison across States, rather than comparing to Medicare. To the
extent a State pays for personal care, home health aide, or homemaker
services on an hourly basis, the State would simply use that hourly
rate in its Medicaid average hourly payment rate calculation of each
respective category of service. However, if for example a State pays
for personal care, home health aide, or homemaker services on a daily
basis, we would expect the State to divide that rate by the number of
hours covered by the rate.
Additionally, and similar to proposed paragraph (b)(3)(i)(E), we
propose in paragraph (b)(3)(ii)(B), that, if the States' Medicaid
average hourly payment rates vary, the rates must separately identify
the average hourly payment rates for payments made to individual
providers and to providers employed by an agency, by population
(pediatric and adult), provider type, and geographical location, as
applicable. We include this proposed provision with the intent of
ensuring the payment rate disclosure contains the highest level of
granularity in each element. As previously discussed, States may pay
providers different payment rates for billing the same service based on
the population being served, provider type, and geographical location
of where the service is delivered. We are seeking public comments on
the proposed requirement for States to calculate the Medicaid average
hourly payment rate made separately to individual providers and to
agency employed providers, which accounts for variation in payment
rates by population (pediatric and adult), provider type, and
geographical location, as applicable, in the payment rate disclosure as
discussed in this section about proposed Sec. 447.203(b)(3)(ii)(B).
In paragraph (b)(3)(ii)(C), we propose to require that the State
disclosure must identify the number of Medicaid-paid claims and the
number of Medicaid enrolled beneficiaries who received a service within
a calendar year for each of the services for which the Medicaid payment
rate is published under proposed paragraph (b)(3)(ii)(B), so that
States, CMS, and other interested parties would be able to
contextualize the previously described payment rate information with
information about the volume of paid claims and number of beneficiaries
receiving personal care, home health aide, and homemaker services.
We propose that the number of Medicaid-paid claims and number of
Medicaid enrolled beneficiaries who received a service be reported
under the same breakdown as paragraph (b)(3)(ii), where the State
provides the number of paid claims and number of beneficiaries
receiving services from individual providers versus agency-employed
providers of personal care, home health aide services, and homemaker
services. As with the comparative payment rate analysis, we are
proposing the claims volume data would be limited to Medicaid-paid
claims and the number of beneficiaries would be limited to Medicaid
enrolled beneficiaries who received a service in the calendar year of
the payment rate disclosure, where the services would fall into the
categories of service for which the average hourly payment rates are
published pursuant to paragraph (b)(3)(ii)(B). In other words,
beneficiary would be counted in the payment rate disclosure for a
particular calendar year when the beneficiary received a service that
is included in one of the categories of services described in paragraph
(b)(2)(iv) that the State has calculated average hourly payment rates
for (the number of Medicaid enrolled beneficiaries who received a
service). A claim would be counted when that beneficiary had a claim
submitted on their behalf by a provider who billed for one of the
categories of services described in paragraph (b)(2)(iv) and the State
paid the claim (number of Medicaid-paid claims). We are seeking to
ensure the payment rate disclosure reflects actual services received by
beneficiaries and paid for by the State, or realized access.\185\
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\185\ Andersen, R.M., and P.L. Davidson. 2007. Improving access
to care in America: Individual and contextual indicators. In
Changing the U.S. health care system: Key issues in health services
policy and management, 3rd edition, Andersen, R.M., T.H. Rice, and
G.F. Kominski, eds. San Francisco, CA: John Wiley & Sons.
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Similar to the comparative payment rate analysis, we considered but
did not propose States identify the number of unique Medicaid-paid
claims and the number of unique Medicaid enrolled beneficiaries who
received a service within a calendar year for each of the services for
which the average hourly payment rates are published pursuant to
paragraph (b)(3)(ii)(B). We also considered but did not propose States
identify the total Medicaid enrolled population who could receive a
service within a calendar year for each of the services for which the
average hourly payment rates are published pursuant to paragraph
(b)(3)(ii)(B) in addition to the proposing States identify the number
of Medicaid enrolled beneficiaries who received a service. As discussed
in the comparative payment rate discussion, we are requesting public
comment on our decision not to require these levels of detail for the
payment rate disclosure. Also similar to the comparative payment rate
analysis requirement under proposed paragraph (b)(3)(i)(E), this
disclosure element would help States, CMS, and other interested parties
identify longitudinal changes in Medicaid service volume and
beneficiary utilization changes that may be an indication of an access
to care issue. Again, with each biennial publication of the State's
comparative payment rate analysis and payment rate disclosure, States
and CMS would be able to compare the number of Medicaid-paid claims and
number of Medicaid enrolled beneficiaries who received a service within
a calendar year for services subject to the payment rate disclosure
with previous years' disclosures. Collecting and comparing data on the
number of paid claims and number of Medicaid enrolled beneficiaries
alongside Medicaid average hourly payment rate data may reveal trends,
such as where a provider type that previously delivered a low volume of
services to beneficiaries has increased their volume of services
delivered after receiving an increase in their payment rate.
We acknowledge that one limitation of using the average hourly
payment rate is that the statistic is sensitive to highs and lows so
one provider receiving an increase in their average hourly payment rate
would bring up the average overall while other providers may not see an
improvement. As these are only correlating trends, we also acknowledge
that there may be other contextualizing factors outside of the payment
rate disclosure that may affect changes in service volume and
utilization. We are seeking public comments on the proposed requirement
for States to include the number of Medicaid-paid claims and number of
Medicaid enrolled beneficiaries who received a service within a
calendar year for which the Medicaid payment rate is published under
paragraph (b)(3)(ii)(B), as specified in proposed Sec.
447.203(b)(3)(ii)(C).
Additionally, in recognition of the importance of services provided
to individuals with intellectual or developmental disabilities and in
an effort to remain consistent with the proposed HCBS provisions at
[[Page 28021]]
Sec. 441.302(k)(3)(i), we are seeking public comment on whether we
should propose a similar provision that would require at least 80
percent of all Medicaid FFS payments with respect to personal care,
home health aide, and homemaker services provided by individual
providers and providers employed by an agency must be spent on
compensation for direct care workers.
In paragraph (b)(4), we propose to require the State agency to
publish the initial comparative payment rate analysis and payment rate
disclosure of its Medicaid payments in effect as of January 1, 2025, as
required under Sec. 447.203(b)(2) and (b)(3), by no later than January
1, 2026. Thereafter, the State agency would be required to update the
comparative payment rate analysis and payment rate disclosure no less
than every 2 years, by no later than January 1 of the second year
following the most recent update. The comparative payment rate analysis
and payment rate disclosure would be required to be published
consistent with the publication requirements described in proposed
Sec. 447.203(b)(1) for payment rate transparency data.
As previously discussed in this proposed rule, we propose that the
Medicaid payment rates included in the initial comparative payment rate
analysis and payment rate disclosure would be those in effect as of
January 1, 2025. Specifically, for the comparative payment rate
analysis, we propose States would conduct a retrospective analysis to
ensure CMS can publish the list of E/M CPT/HCPCS codes for the
comparative payment rate analysis and States have timely access to all
information required to complete comparative payment rate analysis. As
described in paragraph (b)(3)(i)(C), we propose States would compare
their Medicaid payment rates to the Medicare non-facility payment rates
effective for the same time period for the same set of E/M CPT/HCPCS
codes, therefore, the Medicare non-facility payment rates as published
on the Medicare PFS for the same time period as the State's Medicaid
payment rates would need to be available to States in a timely manner
for their analysis and disclosure to be conducted and published as
described in paragraph (b)(4). Medicare publishes its annual PFS final
rule in November of each year and the Medicare non-facility payment
rates as listed on the Medicare PFS are effective the following January
1. For example, the 2025 Medicare PFS final rule would be published in
November 2024 and the Medicare non-facility payment rates as listed on
the Medicare PFS would be effective January 1, 2025, so States would
compare their Medicaid payment rates effective as of January 1, 2025,
to the Medicare PFS payment rates effective January 1, 2025 when
submitting the initial comparative payment rate analysis that is due on
January 1, 2026.
Also previously discussed in this proposed rule, we intend to
publish the initial and subsequent updates to the list of E/M CPT/HCPCS
codes subject to the comparative payment rate analysis in a timely
manner that allows States approximately one full calendar year between
the publication of the CMS-published list of E/M CPT/HCPCS codes and
the due date of the comparative payment rate analysis. Because the list
of E/M CPT/HCPCS codes is derived from the relevant calendar year's
Medicare PFS, the Medicare non-facility payment rates the State would
need to include in their comparative payment rate analysis would also
be available to States. We expect approximately one full calendar year
of the CMS-published list of E/M CPT/HCPCS codes and Medicare non-
facility payment rates as listed on the Medicare PFS being available to
States would provide the States with sufficient time to develop and
publish their comparative payment rate analyses as described in
paragraph (b)(4). We considered proposing the same due date and
effective time period for Medicaid and Medicare payment rates where the
initial publication of the comparative payment rate analysis would be
due January 1, 2026, and would contain payment rates effective January
1, 2026; however, we believe a two month time period between Medicare
publishing its PFS payment rates in November and the PFS payment rates
taking effect on January 1 would be an insufficient amount of time for
CMS to publish the list of E/M CPT/HCPCS codes subject to the
comparative payment rate analysis and for States to develop and publish
their comparative payment rate analyses by January 1. While the
proposed payment rate disclosure would not require a comparison to
Medicare, we are proposing to use the same due date and effective
period of Medicaid payment rates for both the proposed comparative
payment rate analysis and payment rate disclosure to maintain
consistency.
We expect the proposed initial publication timeframe to provide
sufficient time for States to gather necessary data, perform, and
publish the first required comparative payment rate analysis and
payment rate disclosure. We determined this timeframe was sufficient
based on implementation experience from the AMRP process, where we
initially proposed a 6-month timeframe between the January 4, 2016
effective date of the 2015 final rule with comment period in the
Federal Register, and the due date of the first AMRP, July 1, 2016. At
the time, we believed that this timeframe would be sufficient for
States to conduct their first review for service categories newly
subject to ongoing AMRP requirements; however, after receiving several
public comments from States on the 2015 final rule with comment period
that State agency staff may have difficulty developing and submitting
the initial AMRPs within the July 1, 2016 timeframe, we modified the
policy as finalized in the 2016 final rule.\186\ Specifically, we
revised the deadline for submission of the initial AMRP until October
1, 2016 and we made a conforming change to the deadline for submission
in subsequent review periods at Sec. 447.203(b)(5)(i) to October
1.\187\ We also found that, despite this additional time, some State
were still late in submitting their first AMRP to us. Therefore, we
believe that proposing an initial publication date of January 1, 2026,
thereby providing States with approximately 2 years between the
effective date of the final rule, if this proposal is finalized, and
the due date of the first comparative payment rate analysis and payment
rate disclosure, would be sufficient. In alignment with the proposed
payment rate transparency requirements, if this rule is finalized at a
time that does not allow for States to have a period of 2 years from
the effective date of the final rule and the proposed January 1, 2026
date to publish the initial comparative payment rate analysis and
payment rate disclosure, then we would propose an alternative date of
July 1, 2026 for the initial comparative payment rate analysis and
payment rate disclosure and for the initial comparative payment rate
analysis and payment rate disclosure to include Medicaid payment rates
approved as of July 1, 2025 to allow more time for States to comply
with the initial comparative payment rate analysis and payment rate
disclosure requirements. We acknowledge that the date of the initial
comparative payment rate analysis and payment rate disclosure
publication is subject to change based on the final rule publication
schedule and effective date, if this rule is finalized. If further
adjustment is necessary beyond the July 1, 2026 timeframe to allow more
time for States to comply with the payment rate transparency
requirements, then we would adjust date of the initial payment
[[Page 28022]]
rate transparency publication in 6-month intervals, as appropriate.
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\186\ 81 FR 21479 at 21479-21480.
\187\ 81 FR 21479 at 21480.
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Also, in Sec. 447.203(b)(4), we propose to require the State
agency to update the comparative payment rate analysis and payment rate
disclosure no less than every 2 years, by no later than January 1 of
the second year following the most recent update. We propose that the
comparative payment rate analysis and payment rate disclosure would be
required to be published consistent with the publication requirements
described in proposed paragraph (b)(1) for payment rate transparency
data. After publication of the 2011 proposed rule, and as we worked
with States to implement the current AMRP requirements after
publication of the 2015 final rule with comment period, many States
expressed concerns that the current requirements of Sec. 447.203,
specifically those in current Sec. 447.203(b)(6) that impose
additional analysis and monitoring requirements in the case of provider
rate reductions or restructurings that could result in diminished
access, are overly burdensome. As described in the 2018 and 2019
proposed rules, ``a number of States expressed concern regarding the
administrative burden associated with the requirements of Sec.
447.203, particularly those States with a very high beneficiary
enrollment in comprehensive, risk-based managed care and a limited
number of beneficiaries receiving care through a FFS delivery system.''
188 189
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\188\ 83 FR 12696 at 12697.
\189\ 84 FR 33722 at 33723.
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Additionally, from our implementation experience, we learned that
the triennial due date for updated AMRPs required by current Sec.
447.203(b)(5)(ii) was too infrequent for States or CMS to identify and
act on access concerns identified by the AMRPs. For example, one State
timely submitted its initial ongoing AMRP on October 1, 2016,
consistent with the requirements in Sec. 447.203(b)(1) through (5),
and timely submitted its first AMRP update (the next ongoing AMRP) 3
years later, on October 1, 2019. The 2016 AMRP included data about
beneficiary utilization and Medicaid-participating providers accepting
new Medicaid patients from 2014 to 2015 (the most recent data available
at the time the State was developing the AMRP), while the 2019 AMRP
update included similar data for 2016 to 2017 (the most recent data
then available). The 2019 AMRP showed that the number of Medicaid-
participating providers accepting new Medicaid patients significantly
dropped in 2016, and the State received a considerable number of public
comments during the 30-day public comment period for the 2019 AMRP
update prior to submission to us per the requirements in Sec.
447.203(b) and (b)(2). This data lag between a drop in Medicaid-
participating providers accepting new Medicaid patients in 2016 and CMS
receiving the next AMRP update with information about related concerns
in 2019 illustrates how the infrequency of the triennial due date for
the AMRP updates could allow a potential access concern to develop
without notice by the State or CMS in between the due dates of the
ongoing AMRP updates. Although Sec. 447.203(b)(7) currently requires
States to have ongoing mechanisms for beneficiary and provider input on
access to care, and States are expected to promptly respond to concerns
expressed through these mechanisms that cite specific access problems,
beneficiaries and providers themselves may not be aware of even
widespread access issues if such issues are not noticed before
published data reveal them.
We also learned from our AMRP implementation experience that the
timing of the ongoing AMRP submissions required by current Sec.
447.203(b)(5)(ii) and access reviews associated with rate reduction or
restructuring SPA submissions required by Sec. 447.203(b)(6) have led
to confusion about the due date and scope of routine, ongoing AMRP
updates and SPA-connected access review submissions, particularly when
States were required to submit access reviews within the 3-year period
between AMRP updates when proposing a rate reduction or restructuring
SPA, per the requirements in current Sec. 447.203(b)(6). For example,
one State timely submitted its initial ongoing AMRP on October 1, 2016,
consistent with the requirements in Sec. 447.203(b)(1) through (5),
then the State submitted a SPA that proposed to reduce provider payment
rates for physical therapy services with an effective date of July 1,
2018, along with an access review for the affected service completed
within the prior 12 months, consistent with the requirements in Sec.
447.203(b)(6). The State's access review submission consisted of its
2016 AMRP submission, updated with data from the 12 months prior to
this SPA submission, with the addition of physical therapy services for
which the SPA proposed to reduce rates. Because the State submitted an
updated version of its 2016 AMRP in 2018 in support of the SPA
submission, the State was confused whether its next AMRP update
submission was due in 2019 (3 years from 2016), or in 2021 (3 years
from 2018). Based on the infrequency of a triennial due date for AMRP
updates and the numerous instances of similar State confusion during
the implementation process for the AMRPs, we identified that the
triennial timeframe was insufficient for the proposed comparative
payment rate analysis and payment rate disclosure. As we considered a
new timeframe for updates to the comparative payment rate analysis and
payment rate disclosure to propose in this rulemaking, we initially
considered proposing to require annual updates. However, we believe
annual updates would add unnecessary administrative burden as annual
updates would be too frequent because many States do not update their
Medicaid fee schedule rates for the codes subject to the comparative
payment rate analysis and payment rate disclosure on an annual basis.
As proposed, the payment rates for the categories of services
subject to the proposed comparative payment rate analysis and payment
rate disclosure are for office-based visits and, in our experience, the
Medicaid payment rates generally do not change much over time due to
the nature of an office visit.\190\ Office visits primarily include
vitals being taken and the time a patient meets with a physician or
NPP; therefore, States would likely have a considerable amount of
historical payment data for supporting the current payment rates for
such services. Given the relatively stable nature of payment rates for
office visits, we aim to help ensure the impact of the comparative
payment rate analysis is maximized for ensuring compliance with section
1902(a)(30)(A) of the Act while minimizing unnecessary burden on States
by holding all States to a proposed update frequency of 2 years to
capture all Medicaid (and corresponding Medicare) payment rate changes.
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\190\ We acknowledge that Medicaid primary care payment
increase, a provision in the Patient Protection and Affordable Care
Act (ACA, Pub. L. 111-148, as amended), temporarily raised Medicaid
physician fees for evaluation and management services (Current
Procedural Terminology codes 99201-99499) and vaccine administration
services and counseling related to children's vaccines (Current
Procedural Terminology codes 90460, 90461, and 90471-90474). This
provision expired on December 31, 2014. https://www.macpac.gov/wp-content/uploads/2015/03/An-Update-on-the-Medicaid-Primary-Care-Payment-Increase.pdf.
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As this proposed rule strives to reduce the amount of
administrative burden from AMRPs on States while also fulfilling our
oversight responsibilities, we believe updating the comparative payment
rate analysis and
[[Page 28023]]
payment rate disclosure no less than every 2 years achieves an
appropriate balance between administrative burden and our oversight
responsibilities with regard to section 1902(a)(30)(A) of the Act. We
intend for the comparative payment rate analysis and payment rate
disclosure States develop and publish to be time-sensitive and useful
sources of information and analysis to help ensure compliance with
section 1902(a)(30)(A) of the Act. If this proposal is finalized, both
the comparative payment rate analysis and payment rate disclosure would
provide the State, CMS, and other interested parties with cross-
sectional data of Medicaid payment rates at various points in time.
This data could be used to track Medicaid payment rates over time as a
raw dollar amount and as a percentage of Medicare non-facility payment
rates as listed on the Medicare PFS as well as changes in the number of
Medicaid-paid claims volume and number of Medicaid enrolled
beneficiaries who received a service over time. The availability of
this data could be used to inform State policy changes, to compare
payment rates across States, or be used for research on Medicaid
payment rates and policies. While we believe the comparative payment
rate analysis and payment rate disclosure would provide useful and
actionable information to States, we do not want to overburden States
with annual updates to the comparative payment rate analysis and
payment rate disclosure. As we are proposing to replace the triennial
AMRP process with less administratively burdensome processes (payment
rate transparency publication, comparative payment rate analysis,
payment rate disclosure, and State analysis procedures for rate
reductions and restructurings) for ensuring compliance with section
1902(a)(30)(A) of the Act, we believe annual updates to the comparative
payment rate analysis and payment rate disclosure would negate at least
a portion of the decrease in administrative burden from eliminating the
AMRP process.
With careful consideration, we believe that our proposal to require
updates to the comparative payment rate analysis and payment rate
disclosure to occur no less than every 2 years is reasonable. We expect
the proposed biennial publication requirement for the comparative
payment rate analysis and payment rate disclosure after the initial
publication date would be feasible for State agencies, provide a
straightforward timeline for updates, limit unnecessary State burden,
help ensure public payment rate transparency, and enable us to conduct
required oversight. We are seeking public comment on the proposed
timeframe for the initial publication and biennial update requirements
for the comparative payment rate analysis and payment rate disclosure
as proposed in Sec. 447.203(b)(4).
Lastly, we also propose in paragraph (b)(4) to require States to
publish the comparative payment rate analysis and payment rate
disclosure consistent with the publication requirements described in
proposed paragraph (b)(1) for payment rate transparency data. Paragraph
(b)(1) would require the website developed and maintained by the single
State Agency to be accessible to the general public. We are proposing
States utilize the same website developed and maintained by the single
State Agency to publish their Medicaid FFS payment rates and their
comparative payment rate analysis and payment rate disclosure. We are
seeking public comment on the proposed required location for States to
publish their comparative payment rate analysis and payment rate
disclosure proposed in Sec. 447.203(b)(4).
In Sec. 447.203(b)(5), we propose a mechanism to ensure compliance
with paragraphs (b)(1) through (b)(4). Specifically, we propose that,
if a State fails to comply with the payment rate transparency and
comparative payment rate analysis and payment rate disclosure
requirements in paragraphs (b)(1) through (b)(4) of proposed Sec.
447.203, including requirements for the time and manner of publication,
that, under section 1904 of the Act and procedures set forth in
regulations at 42 CFR part 430 subparts C and D, future grant awards
may be reduced by the amount of FFP we estimate is attributable to the
State's administrative expenditures relative to the total expenditures
for the categories of services specified in paragraph (b)(2) of
proposed Sec. 447.203 for which the State has failed to comply with
applicable requirements, until such time as the State complies with the
requirements. We also propose that unless otherwise prohibited by law,
FFP for deferred expenditures would be released after the State has
fully complied with all applicable requirements. This proposed
enforcement mechanism is similar in structure to the mechanism that
applies with respect to the Medicaid Disproportionate Share Hospital
(DSH) reporting requirements in Sec. 447.299(e), which specifies that
State failure to comply with reporting requirements will lead to future
grant award reductions in the amount of FFP CMS estimates is
attributable to expenditures made for payments to the DSH hospitals as
to which the State has not reported properly. We are proposing this
long-standing and effective enforcement mechanism in this proposed rule
because we believe it is proportionate and clear, and to remain
consistent with other compliance actions we take for State non-
compliance with statutory and regulatory requirements. We are seeking
public comment on the proposed method for ensuring compliance with the
payment rate transparency and comparative payment rate analysis and
payment rate disclosure requirements, as specified in proposed Sec.
447.203(b)(5).
A fundamental element of ensuring access to covered services is the
sufficiency of a provider network. As discussed elsewhere in this rule,
the HCBS direct care workforce is currently experiencing notable worker
shortages.\191\ A robust workforce providing HCBS allows more
beneficiaries to obtain necessary services in home and community-based
settings. We are proposing to use data-driven benchmarks in requiring
comparative payment rate analyses relative to Medicare non-facility
payment rates for the categories of service specified in proposed Sec.
447.203(b)(2)(i) through (iii), but Medicare non-facility payment rates
are generally not relevant in the context of HCBS, as discussed earlier
in this section. Furthermore, data alone cannot replace the lived
experience of direct care workers and recipients of the services they
provide.
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\191\ https://www.macpac.gov/wp-content/uploads/2022/03/MACPAC-brief-on-HCBS-workforce.pdf.
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Understanding how Medicaid payment rates compare in different
geographic areas of a State and across State programs is also an
important access to care data point for covered benefits where Medicaid
is a predominant payer of services, as in the case of HCBS. In the
absence of HCBS coverage and a lack of available payment rate and
claims utilization data from other health payers, such as Medicare or
private insurers, and with the significant burden and potential
infeasibility associated with gathering payment data for individuals
who pay out of pocket (that is, self-pay), we believe it would be a
reasonable standard for States to compare their rates to geographically
similar State Medicaid program payment rates as a basis for
understanding compliance with section 1902(a)(30)(A) of the Act for
those services. In addition, even for services where other payers
establish
[[Page 28024]]
payment rates, comparisons to rates paid by other geographically
similar States could be important to understanding compliance with
section 1902(a)(30)(A) of the Act since Medicaid beneficiaries may have
unique health care needs that are not typical of the general population
in particular geographic areas.
Section 2402(a) of the Affordable Care Act directs the Secretary to
promulgate regulations ensuring that all States develop service systems
that, among other things, improve coordination and regulation of
providers of HCBS to oversee and monitor functions, including a
complaint system, and ensure that there are an adequate number of
qualified direct care workers to provide self-directed services. This
statutory mandate, coupled with the workforce shortages exacerbated by
the COVID-19 pandemic, necessitates action specific to direct care
workers. As such, we are proposing to require States to establish an
interested parties' advisory group to advise and consult on FFS rates
paid to direct care workers providing self-directed and agency-directed
HCBS, at a minimum for personal care, home health aide, and homemaker
services as described in Sec. 440.180(b)(2) through (4), and States
may choose to include other HCBS. The definition of direct care workers
is proposed elsewhere in this rule under Sec. 441.302(k)(1)(ii). We
propose to utilize that definition, to consider a direct care worker a
registered nurse, licensed practical nurse, nurse practitioner, or
clinical nurse specialist who provides nursing services to Medicaid-
eligible individuals receiving HCBS; a licensed nursing assistant who
provides such services under the supervision of a registered nurse,
licensed practical nurse, nurse practitioner, or clinical nurse
specialist; a direct support professional; a personal care attendant; a
home health aide; or other individuals who are paid to provide services
to address activities of daily living or instrumental activities of
daily living directly to Medicaid-eligible individuals receiving HCBS
available under part 441, subpart G. A direct care worker may be
employed by a Medicaid provider, State agency, or third party;
contracted with a Medicaid provider, State agency, or third party; or
delivering services under a self-directed service model.
We propose that the group would consult on rates for service
categories under the Medicaid State plan, section 1915(c) waiver and
demonstration programs, as applicable, where payments are made to
individual providers or providers employed by an agency for, at a
minimum, the previously described types of services, including for
personal care, home health aide, and homemaker services provided under
sections 1905(a), 1915(i), 1915(j), and 1915(k) State plan authorities,
and section 1915(c) waivers. These proposed requirements also would
extend to rates for HCBS provided under section 1115 demonstrations, as
is typical for rules pertaining to HCBS authorized using demonstration
authority. The interested parties advisory group may consult on other
HCBS, at the State's discretion.
Specifically, in Sec. 447.203(b)(6), we propose that the State
agency would be required to establish an advisory group for interested
parties to advise and consult on provider rates with respect to service
categories under the Medicaid State plan, section 1915(c) waiver and
demonstration programs, as applicable, where payments are made to the
direct care workers specified in Sec. 441.302(k)(1)(ii) for the self-
directed or agency-directed services found at Sec. 440.180(b)(2)
through (4). The interested parties' advisory group would be required
to include, at a minimum, direct care workers, beneficiaries and their
authorized representatives, and other interested parties. ``Authorized
representatives'' refers to individuals authorized to act on the behalf
of the beneficiary, and other interested parties may include
beneficiary family members and advocacy organizations. To the extent a
State's MAC established under proposed Sec. 431.12, if finalized,
meets the requirements of this regulation, the State could utilize that
committee for this purpose. However, we note the roles of the MAC under
proposed Sec. 431.12 and the interested party advisory group under
proposed Sec. 447.203(b)(6) would be distinct, and the existence or
absence of one committee or group (for example, if one of these
proposals is not finalized) would not affect the requirements with
respect to the other as established in a final rule.
We further propose in Sec. 447.203(b)(6)(iii) that the interested
parties' advisory group would advise and consult with the Medicaid
agency on current and proposed payment rates, HCBS payment adequacy
data as required at Sec. 441.311(e), and access to care metrics
described in Sec. 441.311(d)(2), associated with services found at
Sec. 440.180(b)(2) through (4), to ensure the relevant Medicaid
payment rates are sufficient to ensure access to homemaker services,
home health aide services, and personal care services for Medicaid
beneficiaries at least as great as available to the general population
in the geographic area and to ensure an adequate number of qualified
direct care workers to provide self-directed personal assistance
services.
In proposed Sec. 447.203(b)(6)(iv), we propose that the interested
parties advisory group would meet at least every 2 years and make
recommendations to the Medicaid agency on the sufficiency of State
plan, 1915(c) waiver, and demonstration direct care worker payment
rates, as applicable. The State agency would be required to ensure the
group has access to current and proposed payment rates, HCBS provider
payment adequacy minimum performance and reporting standards as
described in Sec. 441.311(e), and applicable access to care metrics
for HCBS as described in Sec. 441.311(d)(2) to produce these
recommendations. These materials would be required to be made be
available with sufficient time for the advisory group to consider them,
formulate recommendations, and transmit those recommendations to the
State. If the State has asked the group to consider a proposed rate
change, they would need to provide the group with sufficient time to
review and produce a recommendation within the State's intended rate
adjustment schedule. This would be necessary because the group's
recommendation would be considered part of the interested parties input
described in proposed Sec. Sec. 447.203(c)(4) and 447.204(b)(3), which
States would be required to consider and analyze. The interested
parties' advisory group would make recommendations to the Medicaid
agency on the sufficiency of the established and proposed State plan,
section 1915(c) waiver and demonstration payment rates, as applicable.
In other words, the group would provide information to the State
regarding whether, based on the group's knowledge and experience,
current payment rates are sufficient to enlist a sufficiently large
work force to ensure beneficiary access to services, and whether a
proposed rate change would be consistent with a sufficiently large work
force or would disincentivize participation in the work force in a
manner that might compromise beneficiary access.
We propose to require States to convene this interested parties'
advisory group every 2 years, at a minimum, to advise and consult on
current and suggested payment rates and the sufficiency of these rates
to ensure access to HCBS for beneficiaries consistent with section
1902(a)(30)(A) of the Act. This timing aligns with the comparative
payment rate analysis and payment rate disclosure publication
requirements proposed in Sec. 447.203(b)(4), although we note that
[[Page 28025]]
this would be a minimum requirement and a State may find that more
frequent meetings would be necessary or helpful for the advisory group
to provide meaningful and actionable feedback. We further propose that
the process by which the State selects its advisory group members and
convenes meetings would be required to be made publicly available, but
other matters, such as the tenure of members, would be left to the
State's discretion.
Finally, in Sec. 447.203(b)(6)(v), we propose that the Medicaid
agency would be required to publish the recommendations of the
interested parties' advisory group consistent with the publication
requirements described in paragraph (b)(1) of this section for payment
rate transparency data, within 1 month of when the group provides the
recommendation to the agency. We intend that States would consider, but
not be required to adopt, the recommendations of the advisory group.
Under this proposal, the work of the advisory group would be regarded
as an element of the State's overall rate-setting process.
Additionally, the feedback of this advisory group would not be required
for rate changes. That is to say, should a State need or want to adjust
rates and it is not feasible to obtain a recommendation from the
advisory group in a particular instance, the State would still be
permitted to submit its rate change SPA to CMS. However, to the extent
the group comments on proposed rate changes, its feedback would be
considered part of the interested parties input described in proposed
Sec. Sec. 447.203(c)(4) and 447.204(b)(3), which States would be
required to consider and analyze, and submit such analysis to us, in
connection with any SPA submission that proposes to reduce or
restructure Medicaid service payment rates. In addition, by way of
clarification, we intend that the advisory group would be permitted to
suggest alternate rates besides those proposed by the State for
consideration.
We are seeking public comment on the proposed interested parties
advisory group and about whether other categories of services should be
included in the requirement for States to consult with the interested
parties advisory group.
3. State Analysis Procedures for Rate Reduction or Restructuring (Sec.
447.203(c))
As stated previously, the Supreme Court's Armstrong decision
underscored the importance of CMS' administrative review of Medicaid
payment rates to ensure compliance with section 1902(a)(30)(A) of the
Act. CMS' oversight role is particularly important when States propose
to reduce provider payment rates or restructure provider payments,
since provider payment rates can affect provider participation in
Medicaid, and therefore, beneficiary access to care. In Sec.
447.203(c), we propose a process for State access analyses that would
be required whenever a State submits a SPA proposing to reduce provider
payment rates or restructure provider payments.
As noted previously, the 2015 final rule with comment period
required that, for any SPA proposing to reduce provider payment rates
or restructure provider payments in circumstances when the changes
could result in diminished access, States must submit a detailed
analysis of access to care under Sec. Sec. 447.203(b)(1) and (b)(6)
and 447.204(b)(1). This analysis includes, under current Sec.
447.203(b)(1), the extent to which beneficiary needs are fully met; the
availability of care through enrolled providers to beneficiaries in
each geographic area, by provider type and site of service; changes in
beneficiary utilization of covered services in each geographic area;
the characteristics of the beneficiary population (including
considerations for care, service and payment variations for pediatric
and adult populations and for individuals with disabilities); and
actual or estimated levels of provider payment available from other
payers, including other public and private payers, by provider type and
site of service. Currently, this information is required for any SPA
that proposes to reduce provider payment rates or restructure provider
payments in circumstances when the changes could result in diminished
access, regardless of the provider payment rates or levels of access to
care before the proposed reduction or restructuring.
Following the implementation of the 2015 final rule with comment
period, as we worked with States to implement the AMRP requirements,
many States expressed concerns that the requirements that accompany
proposed rate reductions or restructurings are overly burdensome.
Specifically, States pointed to instances where proposed reductions or
restructurings are nominal, or where rate changes are made via the
application of a previously approved rate methodology, such as when the
State's approved rate methodology ties Medicaid payment rates to a
Medicare fee schedule and the Medicare payment rate is reduced. We
acknowledged these concerns through previous proposed rulemaking. In
the 2018 proposed rule, we agreed that our experience implementing the
AMRP process from the 2015 final rule with comment period raised
questions about the benefit of the access analysis when proposed rate
changes include nominal rate reductions or restructurings that are
unlikely to result in diminished access to care.\192\
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\192\ 83 FR 12696 at 12697.
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We did not finalize the 2018 proposed rule; instead, in response to
feedback, we proposed a rescission of the AMRP process in the 2019
proposed rule.\193\ In that proposed rule, we indicated that future
guidance would be forthcoming to provide information on the required
data and analysis that States might submit with rate reduction or
restructuring SPAs in place of the AMRPs to support compliance with
section 1902(a)(30)(A) of the Act.\194\ We did not finalize the
rescission proposed in the 2019 proposed rule. Although we are
concerned that the current AMRP process is overly burdensome for States
and CMS in relation to the benefit obtained in helping ensure
compliance with the access requirement in section 1902(a)(30)(A) of the
Act, our 2018 and 2019 proposed rules did not adequately consider our
need for information and analysis from States seeking to reduce
provider payment rates or restructure provider payments to enable us to
determine that the statutory access requirement is met when making SPA
approval decisions.
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\193\ 84 FR 3372.2.
\194\ Id at 33723.
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To improve the efficiency of our administrative procedures and
better inform our SPA approval decisions, this proposed rule would
establish standard information that States would be required to submit
with any proposed rate reductions or proposed payment restructurings in
circumstances when the changes could result in diminished access,
including a streamlined set of data when the reductions or
restructurings are nominal, the State rates are above a certain
percentage of Medicare payment rates, and there are no evident access
concerns raised through public processes; and an additional set of data
elements that would be required when States propose FFS provider
payment rate reductions or restructurings in circumstances when the
changes could result in diminished access and these criteria are not
met. For both sets of required or potentially required elements, we are
proposing to standardize the data and information States would be
required to submit with rate reduction or restructuring SPAs. Although
the AMRP processes have helped to improve our administrative
[[Page 28026]]
reviews and helped us make informed SPA approval determinations, the
procedures within this proposed rule would provide us with similar
information in a manner that reduces State burden. Additionally, the
proposed procedures would provide States increased flexibility to make
program changes with submission of streamlined supporting data to us
when current Medicaid rates and proposed changes fall within specified
criteria that create a reasonable presumption that proposed reductions
or restructuring would not reduce beneficiary access to care in a
manner inconsistent with section 1902(a)(30)(A) of the Act.
This proposed rule seeks to achieve a more appropriate balance
between reducing unnecessary burden for States and CMS, and ensuring
that we have the information necessary to make appropriate
determinations for whether a rate reduction or restructuring SPA might
result in beneficiary access to covered services failing to meet the
standard in section 1902(a)(30)(A) of the Act. In Sec. 447.203(c), we
propose to establish analyses that States would be required to perform,
document, and submit concurrently with the submission of rate reduction
and rate restructuring SPAs, with additional analyses required in
certain circumstances due to potentially increased access to care
concerns.
We are proposing a two-tiered approach for determining the level of
access analysis States would be required to conduct when proposing
provider payment rate reductions or payment restructurings. The first
tier of this approach, proposed at Sec. 447.203(c)(1), sets out three
criteria for States to meet when proposing payment rate reductions or
payment restructurings in circumstances when the changes could result
in diminished access that, if met, would not require a more detailed
analysis to establish that the proposal meets the access requirement in
section 1902(a)(30)(A) of the Act. The State agency would be required
to provide written assurance and relevant supporting documentation that
the three criteria specified in those paragraphs are met, as well as a
description of the State's procedures for monitoring continued
compliance with section 1902(a)(30)(A) of the Act. As explained in more
detail later in this section, these criteria proposed in Sec.
447.203(c)(1) represent thresholds we believe would likely assure that
Medicaid payment rates would continue to be sufficient following the
change 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.
We note that, in the course of our review of a payment SPA that
meets these criteria, as with any SPA review, we may need to request
additional information to ensure that all Federal SPA requirements are
met. We also note that meeting the three criteria described in proposed
Sec. 447.203(c)(1) does not guarantee that the SPA would be approved,
if other applicable Federal requirements are not met. Furthermore, if
any criterion in the first tier is not met, we propose a second tier in
Sec. 447.203(c)(2), which would require the State to conduct a more
extensive access analysis in addition to providing the results of the
analysis in the first tier. A detailed discussion of the second tier
follows the details of the first tier in this section.
Under proposed Sec. 447.203(c)(1)(i), the State would be required
to provide a supported assurance that Medicaid payment rates in the
aggregate (including base and supplemental payments) following the
proposed reduction or restructuring for each benefit category affected
by the proposed reduction or restructuring would be at or above 80
percent of the most recently published Medicare payment rates for the
same or a comparable set of Medicare-covered services.
In proposed Sec. 447.203(c)(1)(i), we mean for ``benefit
category'' to refer to all individual services under a category of
services described in section 1905(a) of the Act for which the State is
proposing a payment rate reduction or restructuring. Comparing the
payment rates in the aggregate would involve first performing a
comparison of the Medicaid to the Medicare payment rate on a code-by-
code basis, meaning CPT, CDT, or HCPCS as applicable, to derive a ratio
for individual constituent services, and then the ratios for all codes
within the benefit category would be averaged by summing the individual
ratios then dividing the sum by the number of ratios. For example, if
the State is seeking to reduce payment rates for a subset of physician
services, the State would review all current payment rates for all
physician services and determine if the proposed reduction to the
relevant subset of codes would result in an average Medicaid payment
rate for all physician services that is at or above 80 percent of the
average corresponding Medicare payment rates. For supplemental
payments, we are relying upon the definition of supplemental payments
in section 1903(bb)(2) of the Act, which defines supplemental payments
as ``a payment to a provider that is in addition to any base payment
made to the provider under the State plan under this title or under
demonstration authority . . . [b]ut such term does not include a
disproportionate share hospital payment made under section 1923 [of the
Act].'' With the inclusion of supplemental payments, States would need
to aggregate the supplemental payments paid to qualifying providers
during the State fiscal year and divide by all providers' total service
volume (including service volume of providers that do not qualify for
the supplemental payment) to establish an aggregate, per-service
supplemental payment amount, then add that amount to the State's fee
schedule rate to compare the aggregate Medicaid payment rate to the
corresponding Medicare payment rate. As this supportive assurance in
proposed Sec. 447.203(c)(1)(i) is expected to be provided with an
accompanying SPA, CMS may ask the State to explain how the analysis was
conducted if additional information is needed as part of the analysis
of the SPA. We are requesting comment on the proposed Sec.
447.203(c)(1)(i) supported assurance that Medicaid payment rates in the
aggregate (including base and supplemental payments) following the
proposed reduction or restructuring for each benefit category affected
by the proposed reduction or restructuring would be at or above 80
percent of the most recently published Medicare payment rates for the
same or a comparable set of Medicare-covered services should include a
weighted average of the payment rate analysis by service volume, number
of beneficiaries receiving the service, and total amount paid by
Medicaid for the code in a year using State's Medicaid utilization data
from the MMIS claims system rather than using a straight code-by-code
analysis.
We understand that this approach may have a smoothing effect on the
demonstrated overall levels of Medicaid payment within a benefit
category under the State plan. In many circumstances, only a subset of
providers are recipients of Medicaid supplemental payments with the
rest of the providers within the benefit category simply receiving the
State plan fee schedule amount. This could result in a demonstration
showing the Medicaid payments being high relative to Medicare, but the
actual payments to a large portion of the providers would be less than
the overall demonstration would suggest. As an alternative, we
considered whether to adopt separate comparisons for
[[Page 28027]]
providers who do and who do not receive supplemental payments, where a
State makes supplemental payments for a service to some but not all
providers of that service. We are requesting comments on the proposed
approach and this alternative.
We selected FFS Medicare, as opposed to Medicare Advantage, as the
proposed payer for comparison for a number of reasons. A threshold
issue is payment rate data availability: private payer data may be
proprietary or otherwise limited in its availability for use by States.
In addition, Medicare sets its prices rather than negotiating them
through contracts with providers, and is held to many similar statutory
standards as Medicaid with respect to those prices, such as efficiency,
access, and quality.\195\ For example, section 1848(g)(7) of the Act
directs the Secretary of HHS to monitor utilization and access for
Medicare beneficiaries provided through the Medicare fee schedule
rates, and directs that the Medicare Payment Advisory Commission
(MedPAC) shall comment on the Secretary's recommendations. In
developing its comments, MedPAC convenes and consults a panel of
physician experts to evaluate the implications of medical utilization
patterns for the quality of and access to patient care. In a March 2001
report, MedPAC summarized its evaluation of Medicare rates, stating
``Medicare buys health care products and services from providers who
compete for resources in private markets. To ensure beneficiaries'
access to high-quality care, Medicare's payment systems therefore must
set payment rates for health care products and services that are: high
enough to stimulate adequate numbers of providers to offer services to
beneficiaries, sufficient to enable efficient providers to supply high-
quality services, given the trade-offs between cost and quality that
exist with current technology and local supply conditions for labor and
capital, and low enough to avoid imposing unnecessary burdens on
taxpayers and beneficiaries through the taxes and premiums they pay to
finance program spending.'' \196\ Medicare's programmatic focus on
beneficiary access aligns with the requirements of section
1902(a)(30)(A) of the Act.
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\195\ https://www.healthcarevaluehub.org/advocate-resources/publications/medicare-rates-benchmark-too-much-too-little-or-just-right.
\196\ MedPAC. Report to the Congress: Medicare Payment Policy,
March 2001. https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/default-source/reports/Mar01Ch1.pdf. Accessed
December 20, 2022.
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In addition, Medicare fee schedule rates are stratified by
geographic areas within the States, which we seek to consider, as well
to ensure that payment rates are consistent with section 1902(a)(30)(A)
of the Act. The Medicare PFS pricing amounts are adjusted to reflect
the variation in practice costs from area to area. Medicare established
GPCI for every Medicare payment locality for each of the three
components of a procedure's relative value unit (that is, the RVUs for
work, practice expense, and malpractice). The current Medicare PFS
locality structure was implemented in 2017 in accordance with the
Protecting Access to Medicare Act of 2014 (PAMA 2014). Under the
current locality structure, there are 112 total PFS localities.\197\
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\197\ Section 220(b) of PAMA 204 added section 1848(e)(6) of the
Act, which requires that, for services furnished on or after January
1, 2017, the locality definitions for California, which has the most
unique locality structure, be based on the Metropolitan Statistical
Area (MSA) delineations as defined by the Office of Management and
Budget (OMB). The resulting modifications to California's locality
structure increased its number of localities from 9 under the
previous structure to 27 under the MSA-based locality structure
(operational note: for the purposes of payment the actual number of
localities under the MSA-based locality structure is 32). Of the 112
total PFS localities, 34 localities are Statewide areas (that is,
only one locality for the entire State). There are 75 localities in
the other 16 States, with 10 States having 2 localities, 2 States
having 3 localities, 1 State having 4 localities, and 3 States
having 5 or more localities. The District of Columbia, Maryland, and
Virginia suburbs, Puerto Rico, and the Virgin Islands are additional
localities that make up the remainder of the total of 112
localities. Medicare PFS Locality Configuration. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Locality. Accessed December 21, 2022.
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When considering geography in their rate analyses, CMS expects
States to conduct a code-by-code analysis of the ratios of Medicaid-to-
Medicare provider payment rates for all applicable codes within the
benefit category, either for each of the GPCIs within the State, or by
calculating an average Medicare rate across the GPCIs within the State
(such as in cases where a State does not vary its rates by region). In
cases where a State does vary its Medicaid rates based on geography,
but that variation does not align with the Medicare GPCI, the State
should utilize the Medicare payment rates as published by Medicare for
the same geographical location as the Medicaid base payment rates to
achieve an equivalent comparison and align the Medicare GPCI to the
locality of the Medicaid payment rates, using the county and locality
information provided by Medicare for the GPCIs, for purposes of
creating a reasonable comparison of the payment rates.\198\ To conduct
such an analysis that meets the requirements of proposed Sec.
447.203(c)(1)(i), States may compare the Medicaid payment rates
applicable to the same Medicare GPCI to each Medicare rate by GPCI
individually, and then aggregate that comparison into an average rate
comparison for the benefit category. To the extent that Medicaid
payment rates do not vary by geographic locality within the State, the
State may also calculate a Statewide average Medicare rate based upon
all of the rates applicable to the GPCIs within that State, and compare
that average Medicare rate to the average Medicaid rate for the benefit
category.
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\198\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Locality.
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Once we decided to propose using Medicare payment rates as a point
of comparison, we needed to decide what threshold ratio of proposed
Medicaid to Medicare payment rates should trigger additional
consideration and review for potential access issues. First, we
considered how current levels of Medicaid payment compares to the
Medicare payment for the same services. In a 2021 Health Affairs
article, Zuckerman, et al, found that ``Medicaid physician fees were 72
percent of Medicare physician fees for twenty-seven common procedures
in 2019.'' \199\ This ratio varied by service type. For example, ``the
2019 Medicaid-to-Medicare fee index was lower for primary care (0.67)
than for obstetric care (0.80) or for other services (0.78).'' The
authors also found that ``between 2008 and 2019 Medicare and Medicaid
fees both increased (23.6 percent for Medicare fees and 19.9 percent
for Medicaid fees), leaving the fee ratios similar.'' \200\
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\199\ Zuckerman, S. et al. ``Medicaid Physician Fees Remained
Substantially Below Fees Paid By Medicare in 2019,'' Health Affairs,
Volume 40, Number 2, February 2021. Available at https://doi.org/10.1377/hlthaff.2020.00611 (accessed December 23, 2022).
\200\ Id.
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Next, considering that Medicaid rates are generally lower than
Medicare, we wanted to examine the relationship between these rates and
a beneficiary's ability to access covered services. This led us to
first look into a comparison of physician new patient acceptance rates
based on a prospective new patient's payer. In a June 2021 fact sheet,
the Medicaid and CHIP Payment and Access Commission (MACPAC) found ``in
2017 (the most recent year available), physicians were significantly
less likely to accept new patients insured by Medicaid (74.3 percent)
than those with Medicare (87.8 percent) or
[[Page 28028]]
private insurance (96.1 percent).'' \201\ MACPAC found this to be true
``regardless of physician demographic characteristics (age, sex, region
of the country); and type and size of practice.'' \202\
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\201\ MACPAC. ``Physician Acceptance of New Medicaid Patients:
Finding from the National Electronic Health Records Survey.'' June.
2021. Available at https://www.macpac.gov/wp-content/uploads/2021/06/Physician-Acceptance-of-New-Medicaid-Patients-Findings-from-the-National-Electronic-Health-Records-Survey.pdf (accessed December 23,
2023).
\202\ Id.
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We then wanted to confirm whether this was related to the rates
themselves. In a 2019 Health Affairs article, the authors found that,
``higher payment continues to be associated with higher rates of
accepting new Medicaid patients . . . physicians most commonly point to
low payment as the main reason they choose not to accept patients
insured by Medicaid.'' \203\ The study found that physicians in States
that pay above the median Medicaid-to-Medicare fee ratio accepted new
Medicaid patients at higher rates than those in States that pay below
the median, with acceptance rates increasing by nearly 1 percentage
point (0.78) for every percentage point increase in the fee ratio.\204\
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\203\ Holgash, K. and Martha Heberlein, ``Physician Acceptance
Of New Medicaid Patients: What Matters And What Doesn't.'' Health
Affairs, April 10, 2019. Available at https://www.healthaffairs.org/do/10.1377/forefront.20190401.678690/full/ (accessed February 22,
2023).
\204\ Id.
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Similarly, in a 2020 study published by the National Bureau of
Economic Research, researchers found that there was a positive
association between increasing Medicaid physician fees and increased
likelihood of having a usual source of care, improved access to
specialty doctor care, and large improvements in caregivers'
satisfaction with the adequacy of health coverage, among children with
special health care needs with a public source of health coverage.\205\
Further, Berman, et al, focused on pediatricians looked at Medicaid-
Medicare fee ratio quartiles and found that the percent of
pediatricians accepting all Medicaid patients and relative pediatrician
participation in Medicaid increased at each quartile, but improvement
was most significant up to the third quartile.\206\ According to the
Kaiser Family Foundation, in 2016, following the expiration of section
1202 of the Affordable Care Act (Pub. L. 111-148), which amended
section 1902(a)(13) of the Act to implement a temporary payment floor
for certain Medicaid primary care physician services, the third
quartile of States had Medicaid-Medicare fee ratios of between 79 and
86 percent for all services provided under all State Medicaid fee-for-
service programs.\207\ Importantly, considering the proposed
requirements at paragraph (c) pertain to proposed payment rate
reductions or payment restructurings in circumstances when the changes
could result in diminished access, multiple recent studies have also
shown that the association between Medicaid physician fees and measures
of beneficiary access are consistent whether physician payments are
increased or decreased to reach a particular level at which access is
assessed.\208\
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\205\ Chatterji, P. et al. ``Medicaid Physician Fees and Access
to Care Among Children with Special Health Care Needs'' National
Bureau of Economic Research, Working Paper 26769, February 2020, p.
2-54. Medicaid Physician Fees and Access to Care among Children with
Special Health Care Needs [bond] NBER. Accessed June 16, 2022.
\206\ Berman, S., et al. ``Factors that Influence the
Willingness of Private Primary Care Pediatricians to Accept More
Medicaid Patients'' Pediatrics.
\207\ https://www.kff.org/medicaid/state-indicator/medicaid-to-medicare-fee-index.
\208\ Candon, M., et al. ``Declining Medicaid Fees and Primary
Care Appointment Availability for New Medicaid Patients'' JAMA
Internal Medicine, Volume 178, Number 1, January 2018, p. 145-146.
Available at https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2663253. Accessed June 16, 2022.
---------------------------------------------------------------------------
The Kaiser Family Foundation found that 23 States have Medicaid-to-
Medicare fee ratios of at least 80 percent for all services, 17 States
have fee ratios of 80 percent for primary care services, 32 States have
fee ratios of 80 percent for obstetric care, and 27 States have fee
ratios of 80 percent for other services.\209\ Additional studies
support the Holgash and Heberlein findings that physicians most
commonly point to low payment as the main reason they choose not to
accept patients insured by Medicaid, showing that States with a
Medicaid to Medicare fee ratio at or above 80 percent show improved
access for children to a regular source of care,\210\ and decreased use
of hospital-based facilities, versus States with a lower Medicaid to
Medicare fee ratio.
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\209\ https://www.kff.org/medicaid/state-indicator/medicaid-to-medicare-fee-index.
\210\ Chatterji, P. et al. ``Medicaid Physician Fees and Access
to Care Among Children with Special Health Care Needs'' National
Bureau of Economic Research, Working Paper 26769, February 2020, p.
2-54. Available at https://www.nber.org/papers/w26769. Accessed
August 16, 2022.
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In general, we are concerned that higher rates of acceptance by
some providers of new patients with payers other than Medicaid
(specifically, Medicare and private coverage), and indications by some
providers that low Medicaid payments are a primary reason for not
accepting new Medicaid patients, may suggest that some beneficiaries
could have a more difficult time accessing covered services than other
individuals in the same geographic area. We are encouraged by findings
that suggest that some increases in Medicaid payment rates may drive
increases in provider acceptance of new Medicaid patients, with one
study finding that new Medicaid patient acceptance rates increased by
0.78 percent for every percentage point increase in the Medicaid-to-
Medicare fee ratio, for certain providers for certain States above the
median Medicaid-to-Medicare fee ratio.211 212 In line with
the Berman study, which found that increases in the percentage of
pediatricians participating in Medicaid and of pediatricians accepting
new Medicaid patients occurred with Medicaid payment rate increases at
each quartile of the Medicaid-to-Medicare fee ratio but were most
significant up to the third quartile, we believe that beneficiaries in
States that provide this level of Medicaid payment generally may be
less likely to encounter access to care issues at rates higher than the
general population.\213\ In line with the Kaiser Family Foundation
reporting of the Medicaid-to-Medicare fee ratio third quartile as
ranging from 79 to 86 percent in 2016, depending on the service, we
believe that a minimum 80 percent Medicaid-to-Medicare fee ratio is a
reasonable threshold to propose in Sec. 447.203(c)(1)(i) as one of
three criteria State proposals to reduce or restructure provider
payments would be required to meet to qualify for the proposed
streamlined documentation process.\214\ As documented by the Kaiser
Family Foundation, many States currently satisfy this ratio for many
Medicaid-covered services, and according to findings by Zuckerman, et
al. in Health Affairs, in 2019, the average nationwide fee ratio for
obstetric care met this
[[Page 28029]]
proposed threshold.215 216 We propose that this percentage
would hold across benefit categories, because we did not find any
indication that a lower threshold would be adequate, or that a higher
threshold would be strictly necessary, to support a level of access to
covered services for Medicaid beneficiaries at least as great as for
the general population in the geographic area. It is worth noting that
the disparities in provider participation for some provider types may
be larger than this overview suggests, as such we are proposing a
uniform standard in the interest of administrative simplicity, but note
that States must meet all three of the criterion in proposed paragraph
(c)(1) to qualify for the streamlined analysis process; otherwise, the
additional analysis specified in proposed paragraph (c)(2) would be
required.
---------------------------------------------------------------------------
\211\ MACPAC. ``Physician Acceptance of New Medicaid Patients:
Finding from the National Electronic Health Records Survey.'' June.
2021. Available at https://www.macpac.gov/wp-content/uploads/2021/06/Physician-Acceptance-of-New-Medicaid-Patients-Findings-from-the-National-Electronic-Health-Records-Survey.pdf (accessed December 23,
2023).
\212\ Holgash, K. and Martha Heberlein, ``Physician Acceptance
Of New Medicaid Patients: What Matters And What Doesn't.'' Health
Affairs, April 10, 2019. Available at https://www.healthaffairs.org/do/10.1377/forefront.20190401.678690/full/ (accessed February 22,
2023).
\213\ Berman, S., et al. ``Factors that Influence the
Willingness of Private Primary Care Pediatricians to Accept More
Medicaid Patients'' Pediatrics.
\214\ https://www.kff.org/medicaid/state-indicator/medicaid-to-medicare-fee-index.
\215\ Id.
\216\ Zuckerman, S. et al. ``Medicaid Physician Fees Remained
Substantially Below Fees Paid By Medicare in 2019,'' Health Affairs,
Volume 40, Number 2, February 2021. Available at https://doi.org/10.1377/hlthaff.2020.00611 (accessed December 23, 2022).
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Given the results of this literature review, and by proposing this
provision as only one part of a three-part assessment of the likely
effect of a proposed payment rate reduction or payment restructuring on
access to care, as further discussed in this section, we propose 80
percent of the most recently published Medicare payment rates, as
identified on the applicable Medicare fee schedule for the same or a
comparable set of Medicare-covered services, as a benchmark for the
level of Medicaid payment for benefit categories that are subject to
proposed provider payment reductions or restructurings that is likely
to enlist enough providers so that care and services are available to
Medicaid beneficiaries at least to the extent as to the general
population in the geographic area, where the additional tests in
proposed Sec. 447.203(c)(1) also are met. The published Medicare
payment rates means the amount per applicable procedure code identified
on the Medicare fee schedule. The established Medicare fee schedule
rate includes the amount that Medicare pays for the claim and any
applicable co-insurance and deductible amounts owed by the patient.
Medicaid fee-schedule rates should be representative of the total
computable payment amount a provider would expect to receive as
payment-in-full for the provision of Medicaid services to individual
beneficiaries. Section 447.15 defines payment-in-full as ``the amounts
paid by the agency plus any deductible, coinsurance or copayment
required by the plan to be paid by the individual.'' Therefore, State
fee schedule should be inclusive of total base payment from the
Medicaid agency plus any applicable coinsurance and deductibles to the
extent that a beneficiary is expected to be liable for those payments.
If a State Medicaid fee schedule does not include these additional
beneficiary cost-sharing payment amounts, then the Medicaid fee
schedule amounts would need to be modified to include expected
beneficiary cost sharing to align with Medicare's fee schedule.
We note that Medicaid benefits that do not have a reasonably
comparable Medicare-covered analogue, and for which a State proposes a
payment rate reduction or payment restructuring in circumstances when
the changes could result in diminished access, would be subject to the
expanded review criteria proposed in Sec. 447.203(c)(2), because the
State would be unable to demonstrate its Medicaid payment rates are at
or above 80 percent of Medicare payment rates for the same or a
comparable set of Medicare-covered services after the payment rate
reduction or payment restructuring in circumstances when the changes
could result in diminished access. For identifying a comparable set of
Medicare-covered services, we would expect to see services that bear a
reasonable relationship to each other. For example, the clinic benefit
in Medicaid does not have a directly analogous clinic benefit in
Medicare. In Medicaid, clinic services generally are defined in Sec.
440.90, as ``preventive, diagnostic, therapeutic, rehabilitative, or
palliative services that are furnished by a facility that is not part
of a hospital but is organized and operated to provide medical care to
outpatients.'' This can include a number of primary care services
otherwise available through physician practices and other primary care
providers, such as nurse practitioners. Therefore, in seeking to
construct a comparable set of Medicare-covered services to which the
State could compare its proposed Medicaid payment rates, the State
reasonably could include Medicare payment rates for practitioner
services, such as physician and nurse practitioner services, or
payments for facility-based services that bear a reasonable similarity
to clinic services, potentially including those provided in Ambulatory
Surgical Centers. We would expect the State to develop a reasonably
comparable set of Medicare-covered services to which its proposed
Medicaid payment rates could be compared and to include with its
submission an explanation of its reasoning and methodology for
constructing the Medicare rate to compare Medicaid payment rates to.
In Sec. 447.203(c)(1)(ii), we propose that the State would be
required to provide a supported assurance that the proposed reduction
or restructuring, including the cumulative effect of all reductions or
restructurings taken throughout the State fiscal year, would result in
no more than a 4 percent reduction in aggregate FFS Medicaid
expenditures for each benefit category affected by proposed reduction
or restructuring within a single State fiscal year. The documentation
would need to show the change stated as a percentage reduction in
aggregate FFS Medicaid expenditures for each affected benefit category.
We recognize that the effects of payment rate reductions and payment
restructurings on beneficiary access generally cannot be determined
through any single measure, and applying a 4 percent threshold without
sufficient additional safeguards would not be prudent. Therefore, we
are proposing to limit the 4 percent threshold as the cumulative
percentage of rate reductions or restructurings applied to the overall
FFS Medicaid expenditures for a particular benefit category affected by
the proposed reduction(s) or restructuring(s) within each State fiscal
year. We are proposing the cumulative application of the threshold to
State plan actions taken within a State fiscal year as opposed to a
SPA-specific application to avoid circumstances where a State may
propose rate reductions or restructurings that cumulatively exceed the
4 percent threshold across multiple SPAs without providing additional
analysis.
For example, if a State proposed to reduce payment rates for a
broad set of obstetric services by 3 percent in State fiscal year 2023
and had not proposed any other payment changes affecting the benefit
category of obstetric care during the same State fiscal year, that
payment change would meet the criterion proposed in Sec.
447.203(c)(1)(ii) because it would be expected to result in no more
than a 3 percent reduction in aggregate Medicaid expenditures for
obstetric care within a State fiscal year. However, if the State had
received approval earlier in the State fiscal year to revise its
obstetric care payment methodology to include value-based arrangements
expected to reduce overall Medicaid expenditures for obstetric care by
2 percent per State fiscal year, then it is likely that the cumulative
effect of the proposal to reduce payment rates for a broad set of
obstetric services by 3 percent and the Medicaid obstetric care
[[Page 28030]]
expenditure reductions under the earlier-approved payment restructuring
would result in an aggregate reduction to FFS Medicaid expenditures for
obstetric services of more than 4 percent in a State fiscal year. If
so, the State's proposal would not meet the criterion proposed in Sec.
447.203(c)(1)(ii), and the proposal would be subject to the additional
review criteria proposed in Sec. 447.203(c)(2). The State would need
to document for our review whether the three percent payment rate
reduction proposal for the particular subset of obstetric services
would be likely to result in a greater than 2 percent further reduction
in aggregate FFS Medicaid expenditures for obstetric care as compared
to the expected expenditures for such services for the State fiscal
year before any payment rate reduction or payment restructuring; if
this expected aggregate reduction is demonstrated to be 2 percent or
less, then the proposal still could meet the criterion proposed in
Sec. 447.203(c)(1)(ii).
We propose to codify a 4 percent reduction threshold for aggregate
FFS Medicaid expenditures in each benefit category affected by a
proposed payment rate reduction or payment restructuring within a State
fiscal year. This threshold is consistent with one we proposed in the
2018 proposed rule, which proposed to require the States to submit an
AMRP with any SPA that proposed to reduce provider payments by greater
than 4 percent in overall service category spending in a State fiscal
year or greater than 6 percent across 2 consecutive State fiscal years,
or restructure provider payments in circumstances when the changes
could result in diminished access.\217\ The proposed rule received
positive feedback from States regarding its potential for mitigating
administrative burden, and providing States with flexibility to
administer their programs and make provider payment rate changes. Some
States and national organizations requested that we increase the rate
reduction threshold to 5 percent and increase the consecutive year
threshold to 8 percent.218 219 Non-State commenters
cautioned CMS against providing too much administrative flexibility and
to not abandon the Medicaid access analysis the current regulations
require. Commenters also raised that 4 and 6 percent may seem nominal
for larger medical practices and health care settings, but for certain
physician practices or direct care workers a 6 percent reduction in
payment could be considerable.\220\ This feedback has been essential in
considering how we proceed with this proposed rule, in which we
emphasize that the size of the rate reduction threshold proposed in
Sec. 447.203(c)(1)(ii) would operate in conjunction with the two other
proposed elements in Sec. 447.203(c)(1)(i) and (iii) to qualify the
State for a streamlined analysis process and would not exempt the
proposal from scrutiny for compliance with section 1902(a)(30)(A) of
the Act.
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\217\ 83 FR 12696 at 12698.
\218\ Connecticut Department of Social Services. Comment Letter
on 2018 Proposed Rule (May 21, 2018), https://downloads.regulations.gov/CMS-2018-0031-0021/attachment_1.pdf.
\219\ National Association of Medicaid Directors. Comment Letter
on 2018 Proposed rule (June 1, 2018), https://downloads.regulations.gov/CMS-2018-0031-0115/attachment_1.pdf.
\220\ American Academy of Family Physicians, Comment Letter on
2018 Proposed Rule (May 21, 2018), https://downloads.regulations.gov/CMS-2018-0031-0017/attachment_1.pdf.
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We are proposing a 4 percent threshold on cumulative provider
payment rate reductions throughout a single State fiscal year as one of
the criteria of the streamlined process in proposed paragraph (c)(1),
and therefore, emphasizing that while we believe this payment threshold
to be nominal and unlikely to diminish access to care, we propose to
include paragraph (c)(1)(i) to require States to review current levels
of provider payment in relation to Medicare and propose to include
paragraph (c)(1)(iii) to require that States rely on the public process
to inform the determination on the sufficiency of the proposed payment
rates after reduction or restructuring, with consideration for
providers and practice types that may be disproportionately impacted by
the State's proposed rate reductions or restructurings.
As previously noted, we would not consider any payment rate
reduction or payment rate restructuring proposal to qualify for the
streamlined analysis process in the proposed paragraph (c)(1) unless
all three of the proposed paragraph (c)(1) criteria are met. Using
information from the Kaiser Family Foundation's Medicaid-to-Medicare
fee index \221\ as an example, only 15 States could have reduced
primary care service provider payment rates by up to 4 percent in 2019
and continued to meet the 80 percent of Medicare threshold in proposed
paragraph (c)(1). Even those 15 States with rates above the 80 percent
of Medicare threshold would be subject to proposed paragraph (c)(2)
requirements if the State received significant public feedback that the
proposed payment reduction or restructuring would result in an access
to care concern, if the State were unable to reasonably respond to or
mitigate such concerns. All States with primary care service payment
rates below the 80 percent of Medicare threshold, no matter the size of
the payment rate reduction or restructuring and no matter whether
interested parties expressed access concerns through available public
processes, would have to conduct an additional access analysis required
under proposed paragraph (c)(2).
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\221\ https://www.kff.org/medicaid/state-indicator/medicaid-to-medicare-fee-index/.
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We issued SMDL #17-004 to provide States with guidance on complying
with regulatory requirements to help States avoid unnecessary burden
when seeking approval of and implementing payment changes, because
States often seek to make payment rate and/or payment structure changes
for a variety of programmatic and budgetary reasons with limited or
potentially no effect on beneficiary access to care, and we recognized
that State legislatures needed some flexibility to manage State budgets
accordingly. We discussed a 4 percent spending reduction threshold with
respect to a particular service category in SMDL #17-004 as an example
of a targeted reduction where the overall change in net payments within
the service category would be nominal and any effect on access
difficult to determine (although we reminded States that they should
document that the State followed the public process under Sec.
447.204, which could identify access concerns even with a seemingly
nominal payment rate reduction). To our knowledge, since the release of
SMDL #17-004, the 4 percent threshold for regarding a payment rate
reduction as nominal has not resulted in access to care concerns in
State Medicaid programs, and it received significant State support for
this reason in comments submitted in response to the 2018 proposed
rule.\222\
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\222\ See, for example: Indiana Family and Social Services
Administration. Comment Letter on 2018 Proposed Rule (May 24, 2018),
https://downloads.regulations.gov/CMS-2018-0031-0055/attachment_1.pdf; Colorado Department of Health Care Policy and
Financing. Comment Letter on 2018 Proposed Rule (May 24, 2018),
https://downloads.regulations.gov/CMS-2018-0031-0087/attachment_1.pdf; The Commonwealth of Massachusetts Executive Office
of Health and Human Services Office of Medicaid. Comment Letter on
2018 Proposed Rule (May 21, 2018), https://downloads.regulations.gov/CMS-2018-0031-0020/attachment_1.pdf.
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In instances where States submitted payment rate reduction SPAs
after the publication of SMDL #17-004, we routinely have asked the
State for an explanation of the purpose of the proposed change, whether
the FFS Medicaid expenditure impact for the
[[Page 28031]]
service category would be within a 4 percent reduction threshold, and
for an analysis of public comments received on the proposed change, and
approved those SPAs to the extent that the State was able to resolve
any potential access to care issues and determined that access would
remain consistent for the Medicaid population. For example, of the 849
SPAs approved in 2019, there were 557 State payment rate changes. Of
those, 39 were classified as payment rate reductions or methodology
changes that resulted in a reduction in overall provider payment.
Within those 39, there were 18 SPAs that sought to reduce payments by
less than 4 percent of overall spending within the benefit category,
most of which were decreases related to changes in Medicare payment
formulas. Sixteen of the remaining 21 SPAs fell into an area discussed
in SMDL #17-004 as being unlikely to result in diminished access to
covered services, where with the State's analytical support, we were
able to determine that the payment rates would continue to comply with
section 1902(a)(30)(A) of the Act without submitting an AMRP with the
SPA. Six of these SPAs represented rate freezes meant to continue
forward a prior year's rates or eliminated an inflation adjustment. Six
SPAs reduced a payment rate to comply with Federal requirements, such
as the Medicaid UPLs in Sec. Sec. 447.272 and 447.321, the Medicaid
DME FFP limit in section 1903(i)(27) of the Act, or the Medicaid
hospice rate, per section 1902(a)(13)(B) of the Act. Four SPAs
contained reductions that resulted from programmatic changes such as
the elimination of a Medicaid benefit or shifting the delivery system
for a benefit to coverage by a pre-paid ambulatory health plan.
Finally, we found five SPAs for which States were required to submit
AMRPs, three of which were submitted to us in 2017 and updated for
2019. Overall, our review of SPAs revealed that smaller reductions may
often be a result of elements of the State's approved payment
methodology or other requirements that may be outside of the State's
control, such as Federal payment limits or changes in the Medicare
payment rate formulas that might be incorporated into a State's
approved payment methodology, or coding changes that might affect the
amount of payment related to the unit of service. We determined, using
this information, that it is necessary to provide States with some
degree of flexibility in making changes, even if that change is a
reduction in provider payment. For example, if a State submits a SPA to
reduce or restructure inpatient hospital base or supplemental payments,
where inaction on the State's part would result in the State exceeding
the applicable UPL, the State would need to reduce inpatient hospital
payments or risk a compliance action against the State for violating
Medicaid UPL requirements authorized under section 1902(a)(30)(A) of
the Act and implementing regulations in 42 CFR 447 subparts C and F. We
recognize that this flexibility does not eliminate the need to monitor
or consider access to care when making payment rate decisions, but also
recognize the need to provide some relief in circumstances where the
State must take a rate action to address an issue of compliance with
another statutory or regulatory requirement.
Accordingly, we propose that, where a State has provided the
information required under proposed paragraphs (c)(1)(i) through (iii),
we would consider that the proposed reduction would result in a nominal
payment adjustment unlikely to diminish access below the level
consistent with section 1902(a)(30)(A) of the Act and would approve the
SPA, provided all other criteria for approval also are met, without
requiring the additional analysis that otherwise would be required
under proposed Sec. 447.203(c)(2).
Finally, in Sec. 447.203(c)(1)(iii), we propose that the State
would be required to provide a supported assurance that the public
processes described in Sec. 447.203(c)(4) yielded no significant
access to care concerns or yielded concerns that the State can
reasonably respond to or mitigate, as appropriate, as documented in the
analysis provided by the State under Sec. 447.204(b)(3). The State's
response to any access concern identified through the public processes,
and any mitigation approach, as appropriate, would be expected to be
fully described in the State's submission to us.
We note that the proposed requirement in Sec. 447.203(c)(4) would
not duplicate the requirements in current Sec. 447.204(a)(2), as the
current Sec. 447.204(a)(2) requires States to consider provider and
beneficiary input as part of the information that States are required
to consider prior to the submission of any SPA that proposes to reduce
or restructure Medicaid service payment rates. The proposed Sec.
447.203(c)(4) describes material that States would be required to
include with any SPA submission that proposes to reduce or restructure
provider payment rates. As discussed in the CMCS informational bulletin
dated June 24, 2016,\223\ before submitting SPAs to us, States are
required under Sec. 447.204(a)(2) to make information available so
that beneficiaries, providers, and other interested parties may provide
input on beneficiary access to the affected services and the impact
that the proposed payment change would have, if any, on continued
service access. States are expected to obtain input from beneficiaries,
providers, and other interested parties, and analyze the input to
identify and address access to care concerns. States must obtain this
information prior to submitting a SPA to us and maintain a record of
the public input and how the agency responded to the input. When a
State submits the SPA to us, Sec. 447.204(b)(3) requires the State to
also submit a specific analysis of the information and concerns
expressed in input from affected interested parties. We would rely on
this and other documentation submitted by the State, including under
proposed Sec. 447.203(c)(1)(iii), (c)(2)(vi), and (c)(4), to inform
our SPA approval decisions.
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\223\ CMCS Informational Bulletin, ``Federal public notice and
public process requirements for changes to Medicaid payment rates.''
Published June 24, 2016. https://www.medicaid.gov/federal-policy-guidance/downloads/cib062416.pdf. Accessed November 3, 2022.
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In addition, States are required use the applicable public process
required under section 1902(a)(13) of the Act, as applicable, and
follow the public notice requirement in Sec. 447.205, as well as any
other public processes required by State law (for example, State-
specified budgetary process requirements), in setting payment rates and
methodologies in view of potential access to care concerns. States have
an important role in identifying access to care concerns, including
through ongoing and collaborative efforts with beneficiaries,
providers, and other interested parties. We understand that not every
concern would be easily resolvable, but we anticipate that States would
be meaningfully engaged with their beneficiary, provider, and other
interested party communities to identify and mitigate issues as they
arise. As discussed herein, we would consider information about access
concerns raised by beneficiaries, providers, and other interested
parties when States propose SPAs to reduce Medicaid payment rates or
restructure Medicaid payments and would not approve proposals that do
not comport with all applicable requirements, including the access
standard in section 1902(a)(30)(A) of the Act.
In feedback received regarding implementation of the AMRP
[[Page 28032]]
requirements in the 2015 final rule with comment period, States
expressed concern about burdensome requirements to draft, seek public
input on, and update their AMRP after receiving beneficiary or provider
complaints that were later resolved by the State's engagement with
beneficiaries and the provider community. Our proposal to require
access review procedures specific to State proposals to reduce payment
rates or restructure payments would provide an opportunity for the
State meaningfully to address and respond to interested parties' input,
and seeks to balance State burden concerns with the clear need to
understand the perspectives of interested parties most likely to be
affected by a Medicaid payment rate reduction or payment restructuring.
Currently, Sec. 447.203(b)(7) requires States to have ongoing
mechanisms for beneficiary and provider input on access to care through
various mechanisms, and to maintain a record of data on public input
and how the State responded to such input, which must be made available
to us upon request. We propose to retain this important mechanism and
to relocate it to Sec. 447.203(c)(4). Through the cross reference to
proposed Sec. 447.203(c)(4) in proposed Sec. 447.203(c)(1)(iii), we
would require States to use the ongoing beneficiary and provider
feedback mechanisms to aid in identifying and assessing any access to
care issues in cooperation with their interested parties' communities,
as a component of the streamlined access analysis criteria in proposed
Sec. 447.203(c)(1).
Together, we believe the proposed criteria of Sec.
447.203(c)(1)(i) through (iii), where all are met, would establish that
a State's proposed Medicaid payment rates and/or payment structure are
consistent with the access requirement in section 1902(a)(30)(A) of the
Act at the time the State proposes a payment rate reduction or payment
restructuring in circumstances when the changes could result in
diminished access. Importantly, as noted above, proposed Sec.
447.203(c)(4) (proposed to be relocated from current Sec.
447.203(b)(7)) would ensure that States have ongoing procedures for
compliance monitoring independent of any approved Medicaid payment
changes.
We previously outlined in SMDL #17-004 several circumstances where
Medicaid payment rate reductions generally would not be expected to
diminish access: reductions necessary to implement CMS Federal Medicaid
payment requirements; reductions that will be implemented as a decrease
to all codes within a service category or targeted to certain codes,
but for services where the payment rates continue to be at or above
Medicare and/or average commercial rates; and reductions that result
from changes implemented through the Medicare program, where a State's
service payment methodology adheres to the Medicare methodology. This
proposed rule would not codify this list of policies that may produce
payment rate reductions unlikely to diminish access to Medicaid-covered
services. However, as a possible addition to the proposed streamlined
access analysis criteria in proposed Sec. 447.203(c)(1), we are
requesting comment on whether this list of circumstances discussed in
SMDL #17-004 should be included in a new paragraph under proposed Sec.
447.203(c)(1) and, if one or more of these circumstances were
applicable, the State's proposal would be considered to qualify for the
streamlined analysis process under proposed Sec. 447.203(c)(1)
notwithstanding the other proposed criteria in proposed
paragraph(c)(1).
Proposed paragraph (c)(1) discusses the full set of written
assurances and relevant supporting documentation that States would be
required to submit with a proposed payment rate reduction or payment
restructuring SPA in circumstances when the changes could result in
diminished access, where the requirements in proposed paragraphs
(c)(1)(i) through (c)(1)(iii) are met. The inclusion of documentation
that confirms all criteria proposed in paragraph (c)(1) are met would
exempt the State from the requirements in proposed Sec. 447.203(c)(2),
discussed later in this section; however, it would not guarantee SPA
approval. Proposed payment rate reduction SPAs and payment rate
restructuring SPAs meeting the requirements in proposed Sec.
447.203(c)(1) would still be subject to CMS' standard review
requirements for all proposed SPAs to ensure compliance with section
1902(a) of the Act, including implementing regulations in part 430.
Specifically, and without limitation, this includes compliance with
sections 1902(a)(2) of the Act, requiring financial participation by
the State in payments authorized under section 1903 of the Act. CMS
reviews SPAs involving payments to ensure that the State has identified
an adequate source of non-Federal share financing for payments under
the SPA so that section 1902(a)(2) of the Act is satisfied; in
particular, section 1903(w) of the Act and its implementing regulations
establish requirements for certain non-Federal share financing sources
that CMS must ensure are met. We further note that a proposed SPA's
failure to meet the criteria in proposed paragraph (c)(1) would not
result in automatic SPA disapproval; rather, such proposals would be
subject to additional documentation and review requirements, as
described in proposed Sec. 447.203(c)(2).
In paragraph (c)(2), we propose the additional, more rigorous State
access analysis that States would be required to submit where the State
proposes to reduce provider payment rates or restructure provider
payments in circumstances when the changes could result in diminished
access where the requirements in paragraphs (c)(1)(i) through (iii) are
not met. We believe this more rigorous access analysis should be
required because we believe that, where the State is unable to
demonstrate that the proposed paragraph (c)(1) criteria are met, more
scrutiny is needed to ensure that the proposed payment rates and
structure would be sufficient to enlist enough providers so that
covered services would be available to beneficiaries at least to the
same extent as to the general population in the geographic area.
Accordingly, we are proposing in Sec. 447.203(c)(2) to have States
document current and recent historical levels of access to care,
including a demonstration of counts and trends of actively
participating providers, counts and trends of FFS Medicaid
beneficiaries who receive the services subject to the proposed payment
rate reduction or payment restructuring; and service utilization
trends, all for the 3-year period immediately preceding the submission
date of the proposed rate reduction or payment restructuring SPA, as a
condition for approval. As with the current AMRP process, the
information provided by the State would serve as a baseline of
understanding current access to care within the State's program, from
which the State's payment rate reduction or payment restructuring
proposal would be scrutinized.
The 2015 final rule with comment period included requirements that
the AMRP process include data on the following topics, in current Sec.
447.203(b)(1)(i) through (v): the extent to which beneficiary needs are
fully met; the availability of care through enrolled providers to
beneficiaries in each geographic area, by provider type and site of
service; changes in beneficiary utilization of covered services in each
geographic area; the characteristics of the beneficiary population
(including considerations for care, service and payment variations for
pediatric and adult populations and for
[[Page 28033]]
individuals with disabilities); and actual or estimated levels of
provider payment available from other payers, including other public
and private payers, by provider type and site of service. The
usefulness of the ongoing AMRP data was directly related to the quality
of particular data measures that States selected to use in their AMRPs,
and one of the biggest concerns we heard about the process was that
States were not always certain that they were providing us with the
relevant data that we needed to make informed decisions about Medicaid
access to care because the 2015 final rule provided States with a
considerable amount of flexibility in determining the type of data that
may be provided in support of the State's access analysis included in
their AMRP. In addition, States were required to consult with the
State's medical advisory committees and publish the draft AMRP for no
less than 30 days for public review and comment, per Sec. 447.203(b).
Therefore, the final AMRP, so long as the base data elements were met
and supported the State's conclusion that access to care in the
Medicaid program met the requirements of section 1902(a)(30)(A) of the
Act, then the AMRP was accepted by us. As a result, the AMRPs were
often very long and complex documents that sometimes included data that
was not necessarily useful for understanding the extent of beneficiary
access to services in the State or for making administrative decisions
about SPAs. In an effort to promote standardization of data measures
and limit State submissions to materials likely to assist in ensuring
consistency of payment rates with the requirements of section
1902(a)(30)(A) of the Act, we are proposing to maintain a number of the
currently required data elements from the AMRP but to be more precise
about the type of information that would be required.
In Sec. 447.203(c)(2), we propose that, for any SPA that proposes
to reduce provider payment rates or restructure provider payments in
circumstances when the changes could result in diminished access, where
the requirements in paragraphs (c)(1)(i) through (iii) are not met, the
State would be required to also provide specified information to us as
part of the SPA submission as a condition of approval, in addition to
the information required under paragraph (c)(1), in a format prescribed
by us. Specifically, in Sec. 447.203(c)(2)(i), we propose to require
States to provide a summary of the proposed payment change, including
the State's reason for the proposal and a description of any policy
purpose for the proposed change, including the cumulative effect of all
reductions or restructurings taken throughout the current State fiscal
year in aggregate FFS Medicaid expenditures for each benefit category
affected by proposed reduction or restructuring within a State fiscal
year. We are proposing to collect this information for SPAs that
require a Sec. 447.203(c)(2) analysis, but for those that meet the
criteria proposed under Sec. 447.203(c)(1), we are not proposing to
require a summary of the proposed payment change, including the State's
reason for the proposal and a description of any policy purpose for the
proposed change beyond that which is already provided as part of a
normal State plan submission or as may be requested by CMS through the
normal State plan review process; we are requesting comment whether
these elements should apply to both proposed Sec. 447.203(c)(1) and
(c)(2) equally.
In Sec. 447.203(c)(2)(ii), we propose to require the State to
provide Medicaid payment rates in the aggregate (including base and
supplemental payments) before and after the proposed reduction or
restructuring for each benefit category affected by proposed reduction
or restructuring, and a comparison of each (aggregate Medicaid payment
before and after the reduction or restructuring) to the most recently
published Medicare payment rates for the same or a comparable set of
Medicare-covered services and, as reasonably feasible, to the most
recently available payment rates of other health care payers in the
State or the geographic area for the same or a comparable set of
covered services. This proposed element is similar to the current Sec.
447.203(b)(1)(v) rate comparison requirement, which requires the AMRP
to include ``[a]ctual or estimated levels of provider payment available
from other payers, including other public and private payers, by
provider type and site of service.'' However, the proposed analysis
specifically would require an aggregate comparison including Medicaid
base and supplemental payments, as applicable, before and after the
proposed reduction or restructuring are implemented, compared to the
most recently published Medicare payment rates for the same or
comparable set of Medicare-covered services and, as reasonably
feasible, to the most recently available payment rates of other health
care payers in the State or the geographic area for the same or a
comparable set of covered services. We found that, first, States
struggled with obtaining and providing private payer data as
contemplated by the 2015 final rule with comment period, and, second,
States were confused about how to compare Medicaid rates to Medicare
rates where there were no comparable services between Medicare and
Medicaid. We wanted to acknowledge the feedback we received from States
during the AMRP process and modify the requirements in the proposed
rule by focusing on the more readily available Medicare payment data as
the most relevant payment comparison for Medicaid in this proposed
rule, as discussed in detail above. We believe that the E/M CPT/HCPCS
code comparison methodology included in the proposed Sec.
447.203(b)(3)(i) and the payment rate disclosure in proposed Sec.
447.203(b)(3)(ii) can serve, at a minimum, as frameworks for States
that struggled to compare Medicaid rates to Medicare where there may be
no other comparable services between the two programs. Otherwise where
comparable services exist, States would be required to compare all
applicable Medicaid payment rates within the benefit category to the
Medicare rates for the same or comparable services under proposed Sec.
447.203(c)(2)(ii). For reasons mentioned previously in this section,
Medicare through MEDPAC engages in substantial analysis of access to
care as it reviews payment rates for services, so we believe this is a
sufficient benchmark for the Medicaid payment rate analysis.
In Sec. 447.203(c)(2)(iii), we are proposing to require States to
provide information about the number of actively participating
providers of services in each benefit category affected by the proposed
reduction or restructuring. For this purpose, an actively participating
provider is a provider that is participating in the Medicaid program
and actively seeing and providing services to Medicaid beneficiaries or
accepting Medicaid beneficiaries as new patients. The State would be
required to provide the number of actively participating providers of
services in each affected benefit category for each of the 3 years
immediately preceding the SPA submission date, by State-specified
geographic area (for example, by county or parish), provider type, and
site of service. The State would be required to document observed
trends in the number of actively participating providers in each
geographic area over this period. The State could provide estimates of
the anticipated effect on the number of actively participating
providers of services in each benefit category affected by the proposed
[[Page 28034]]
reduction or restructuring, by geographic area. This data element is
similar to current Sec. 447.203(b)(1)(ii), under which States must
analyze the availability of care through enrolled providers to
beneficiaries in each geographic area, by provider type and site of
service, in the AMRP; however, the proposal would require specific
quantitative information describing the number of providers, by
geographic area, provider type, and site of service available to
furnish services to Medicaid beneficiaries and leaves less discretion
to the States on specific data measures. With all of the data elements
included in proposed paragraph (c)(2), we are proposing that the data
come from the 3 years immediately preceding the State plan amendment
submission date, as this would provide us with the most recent data and
would allow for considerations for data anomalies that might otherwise
distort a demonstration of access to care if only 1 year of data was
used.
In Sec. 447.203(c)(2)(iv), we are proposing to require States to
provide information about the number of Medicaid beneficiaries
receiving services through the FFS delivery system in each benefit
category affected by the proposed reduction or restructuring. The State
would be required to provide the number of beneficiaries receiving
services in each affected benefit category for each of the 3 years
immediately preceding the SPA submission date, by State-specified
geographic area (for example, by county or parish). The State would be
required to document observed trends in the number of Medicaid
beneficiaries receiving services in each affected benefit category in
each geographic area over this period. The State would be required to
provide quantitative and qualitative information about the beneficiary
populations receiving services in the affected benefit categories over
this period, including the number and proportion of beneficiaries who
are adults and children and who are living with disabilities, and a
description of the State's consideration of the how the proposed
payment changes may affect access to care and service delivery for
beneficiaries in various populations. The State would be required to
provide estimates of the anticipated effect on the number of Medicaid
beneficiaries receiving services through the FFS delivery system in
each benefit category affected by the proposed reduction or
restructuring, by geographic area. This proposed provision is a
combination of current Sec. 447.203(b)(1)(i) and (iv), which require
States to provide an analysis of the extent to which beneficiary needs
are met, and the characteristics of the beneficiary population
(including considerations for care, service and payment variations for
pediatric and adult populations and for individuals with disabilities).
Even though we are not proposing to require this analysis to be updated
broadly with respect to many benefit categories on an ongoing basis, we
would require current information on the number of beneficiaries
currently receiving services through the FFS delivery system in each
benefit category affected by the proposed reduction or restructuring to
inform our SPA review process to ensure that the statutory access
standard is met. The inclusion of this beneficiary data is relevant
because it provides information about the recipients of Medicaid
services and where, geographically, these populations reside to ensure
that the statutory access standard is met.
In Sec. 447.203(c)(2)(v), we are proposing to require information
about the number of Medicaid services furnished through the FFS
delivery system in each benefit category affected by the proposed
reduction or restructuring. The State would be required to provide the
number of Medicaid services furnished in each affected benefit category
for each of the 3 years immediately preceding the SPA submission date,
by State-specified geographic area (for example, by county or parish),
provider type, and site of service. The State would be required to
document observed trends in the number of Medicaid services furnished
in each affected benefit category in each geographic area over this
period. The State would be required to provide quantitative and
qualitative information about the Medicaid services furnished in the
affected benefit categories over this period, including the number and
proportion of Medicaid services furnished to adults and children and
who are living with disabilities, and a description of the State's
consideration of the how the proposed payment changes may affect access
to care and service delivery. The State would be required to provide
estimates of the anticipated effect on the number of Medicaid services
furnished through the FFS delivery system in each benefit category
affected by the proposed reduction or restructuring, by geographic
area. This proposed data element is similar to that currently required
in Sec. 447.203(b)(1)(iii), which requires an analysis of changes in
beneficiary utilization of covered services in each geographic area.
However, as stated earlier, the difference here is that this proposed
analysis would be limited to the beneficiary populations impacted by
the rate reduction or restructuring, for a more narrow set of data
points, rather than requiring the State to conduct a full review of the
Medicaid beneficiary population every 3 years on an ongoing basis. Even
though we are not proposing to require this analysis to be updated
broadly with respect to many benefit categories on an ongoing basis, we
would require current information on the number and types of Medicaid
services being delivered to Medicaid beneficiaries through the FFS
delivery system in each benefit category affected by the proposed
reduction or restructuring to inform our SPA review process to ensure
that the statutory access standard is met. The inclusion of this data
is relevant because it provides information about the actual
distribution of care received by Medicaid beneficiaries and where,
geographically, these services are provided to ensure that the
statutory access standard is met.
Finally, in Sec. 447.203(c)(2)(vi), we are proposing to require a
summary of, and the State's response to, any access to care concerns or
complaints received from beneficiaries, providers, and other interested
parties regarding the service(s) for which the payment rate reduction
or restructuring is proposed as required under Sec. 447.204(a)(2).
This proposed requirement mirrors the requirement in Sec.
447.204(b)(3), which requires that for any SPA submission that proposes
to reduce or restructure Medicaid service payment rates, a specific
analysis of the information and concerns expressed in input from
affected interested parties must be provided at the time of the SPA
submission. The new proposed Sec. 447.203(c)(2)(vi) requires the same
analysis while providing more detail as to what we expect the State to
provide. Specifically, proposed Sec. 447.203(c)(2)(vi) would require
information about concerns and complaints from beneficiaries and
providers specifically, as well as from other interested parties, and
would underscore that the required analysis would be required to
include the State's responses.
Where any of the previously discussed proposed data elements
requires an analysis of data over a 3-year period, we are proposing
this time span to smooth statistical anomalies, and so that data
variations can be understood. For example, any 3-year period look-back
that includes portions of time
[[Page 28035]]
during a public health emergency, such as that for the COVID-19
pandemic, might include much more variation in the access to care
measures than periods before or after the public health emergency. By
using a 3-year period, it is more likely that the State, CMS, and other
interested parties would be able to identify and appropriately account
for short term disruptions in access-related measures, for example,
when the number of services performed dropped precipitously in 2020 as
elective visits and procedures were postponed or canceled due to the
public health emergency.\224\ If the proposed rule only included a 12-
month period, for example, it might not be clear that the data
represent an accurate reflection of access to care at the time of the
proposed reduction or restructuring. For example, a State may see
variation in service utilization if there have been programmatic
changes that are introduced over time, such as a move to increase care
provided through a managed care delivery system in the State through
which the fee-for-service utilization declines steadily until managed
care enrollment targets are achieved, but a one-time review of that
fee-for-service utilization capturing just a 12-month period might not
capture data most reflective of the current fee-for-service utilization
demonstrating access to care consistent with section 1902(a)(30)(A) of
the Act. We are seeking public comment on the proposed use of a 3-year
period where the proposed rule would require data about trends over
time in the data elements proposed to be required under Sec.
447.203(c)(2). We are also seeking public comment on the data elements
required in Sec. 447.203(c)(2) as additional State rate analysis.
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\224\ Stuart, B. ``How The COVID-19 Pandemic Has Affected
Provision Of Elective Services: The Challenges Ahead.'' Health
Affairs, October 8, 2020. Available at https://www.healthaffairs.org/do/10.1377/forefront.20201006.263687 (accessed
February 27, 2023).
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Proposed paragraph (c)(2) would require that States conduct and
provide to us a rigorous analysis of a proposed payment rate
reduction's or payment restructuring's potential to affect beneficiary
access to care. However, by limiting these analyses to only those
proposed payment rate reductions and payment restructurings in
circumstances when the changes could result in diminished access that
do not meet the criteria in proposed paragraph (c)(1), we believe that
the requirements proposed in paragraph (c)(2) would help to enable us
to determine whether the proposed State Medicaid payment rates and
payment methodologies are consistent with section 1902(a)(30)(A) of the
Act while minimizing State and Federal administrative burden, to the
extent possible. We would use this State-provided information and
analysis to help us understand the current levels of access to care in
the State's program, and determine, considering the provider,
beneficiary, and other interested party input collected through
proposed Sec. 447.203(c)(4), whether the proposed payment rate
reduction or payment restructuring likely would reduce access to care
for the particular service(s) consistent with the statutory standard in
section 1902(a)(30)(A) of the Act. If we approve the State's proposal,
the data provided would serve as a baseline for prospective monitoring
of access to care within the State.
The proposed analysis and documentation requirements in paragraph
(c)(2) draw, in part, from the current requirements of the AMRP process
in the current Sec. 447.203(b)(1), and reflect the diverse methods and
measures that are and can be used to monitor access to care. We also
drew on some of the comments received on the 2011 proposed rule, as
discussed in the 2015 final rule with comment period, where several
commenters recommended that CMS consider identifying a set of uniform
measures that States must collect data on or that CMS weighs more
heavily in its analysis.\225\ We are proposing to provide more
specificity on the types of uniform data elements in this proposed rule
in Sec. 447.203(c) than is provided under current Sec. 447.203(b)(1).
States have shown that they have access to the data listed in the
proposed Sec. 447.203(c)(2) when we have requested it during SPA
reviews and through the AMRP process, and through this proposed rule,
we are proposing to specify the type of data that we would expect
States to provide with rate reduction or restructuring SPAs that do not
meet the proposed criteria for streamlined analysis under Sec.
447.203(c)(1). As noted elsewhere in the preamble, the ongoing AMRP
requirements have presented an administratively burdensome process for
States to follow every 3 years, particularly where we did not provide
States with the specific direction on the types of data elements we
preferred for States to include. However, the data elements involved in
the current AMRP process in Sec. 447.203(b)(1) can provide useful
information about beneficiary access to care in current Sec.
447.203(b)(1)(i), (iii), and (iv); Medicaid provider availability in
current Sec. 447.203(b)(1)(ii); and about payment rates available from
other payers, which may affect Medicaid beneficiaries' relative ability
to access care, in current Sec. 447.203(b)(1)(v). We found that the
AMRPs were most relevant when updated to accompany a submission of rate
reduction or restructuring SPAs as specified in the current Sec.
447.203(b)(6); accordingly, to better balance ongoing State and Federal
administrative burden with our need to obtain access-related
information to inform our approval decisions for payment rate reduction
or restructuring SPAs, we are proposing to end the ongoing AMRP
requirement but maintain a requirement that States include similar data
elements when submitting such SPAs to us that do not qualify for the
proposed streamlined analysis process under Sec. 447.203(c)(1).
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\225\ 80 FR 67576 at 67590.
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The proposed analyses in paragraph (c)(2) would enable us to focus
our review of Medicaid access to care on proposals that may result in
diminished access to care, enabling us to more substantively review a
proposed rate reduction's or restructuring's potential impact on access
(for example, counts of participating providers), realized access (for
example, service utilization trends), and the beneficiary experience of
care (for example, characteristics of the beneficiary population,
beneficiary utilization data, and information related to feedback from
beneficiaries and other interested parties collected during the public
process and through ongoing beneficiary feedback mechanisms, along with
the State's responses to that feedback), while also being able to more
quickly work through a review of nominal rate reduction SPAs for which
States have demonstrated certain levels of payment and for which the
public process did not generate access to care concerns. By including
information on provider type and site of service, we believe States
would be able to demonstrate access to the services provided under a
specific benefit category within a number different settings across the
Medicaid program, such as the availability of physicians services
delivered in a physician practice, clinic setting, FQHC or RHC, or even
in a hospital-based office setting. We believe that by defining
specific data elements which must be provided to support a payment rate
reduction SPA would create a more predictable process for States and
for CMS in conducting the SPA review than under the current AMRP
process in Sec. 447.203(b)(6).
Furthermore, data elements proposed to be required under proposed
Sec. 447.203(c)(2) would be based on State-specified geographic
stratifications, to help ensure we can perform access
[[Page 28036]]
review consistent with the requirements of section 1902(a)(30)(A) of
the Act. We expect that States would have readily available access to
geographically differential beneficiary and provider data. Some of this
information is available through CMS-maintained resources, such as the
Transformed Medicaid Statistical Information System (T-MSIS), and other
data is available through the National Plan and Provider Enumeration
System (NPPES), but we believe that States should have their own data
systems that would allow them to generate the most up-to-date
beneficiary utilization and provider enrollment data, stratified by
geographic areas within the State. States should use the most recent
complete data available for each of the proposed data elements, and
each would be required to be demonstrated to CMS by State-specified
geographic area. We believe that the geographic stratification would
enable CMS to establish a baseline for Medicaid access to care within
the geographic areas so that we can determine if current levels of
access to care are consistent with section 1902(a)(30)(A) of the Act,
and can make future determinations if access is diminished in the
future within the geographic area. For all of the data elements in
proposed Sec. 447.203(c)(2), the more geographic differentiation that
can be provided (that is, the smaller and more numerous the distinct
geographic areas of the State that are selected for separate analysis),
the more we believe that the State can meaningfully demonstrate that
the proposed rate changes are consistent with the access standard in
section 1902(a)(30)(A) of the Act, which requires that States assure
that payments 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.
If finalized, we anticipate releasing subregulatory guidance,
including a template to support completion of the analysis that would
be required under paragraph (c)(2), prior to the beginning date of the
Comparative Payment Rate Analysis Timeframe proposed in Sec.
447.203(b)(4). In the intervening period, we anticipate working
directly with States through the SPA review process to ensure
compliance with section 1902(a)(30)(A) of the Act.
In Sec. 447.203(c)(3), we propose mechanisms for ensuring
compliance with requirements for State analysis for rate reduction or
restructuring, as specified in proposed paragraphs (c)(1) and (c)(2),
as applicable. We propose that a State that submits a SPA that proposes
to reduce provider payments or restructure provider payments that fails
to provide the required information and analysis to support approval as
specified in proposed paragraphs (c)(1) and (2), as applicable, may be
subject to SPA disapproval under Sec. 430.15(c). Additionally, States
that submit relevant information, but where there are unresolved access
to care concerns related to the proposed SPA, including any raised by
CMS in our review of the proposal and any raised through the public
process as specified in proposed paragraph (c)(4) of this section, or
under Sec. 447.204(a)(2), may be subject to SPA disapproval under
Sec. 430.15(c). Disapproving a SPA means that the State would not have
authority to implement the proposed rate reduction or restructuring and
would be required to continue to pay providers according to the rate
methodology described in the approved State plan. Proposed paragraph
(c)(3) would further provide that if, after approval of a proposed rate
reduction or restructuring, State monitoring of beneficiary access
shows a decrease in Medicaid access to care, such as a decrease in the
provider-to-beneficiary ratio for any affected service, or the State or
CMS experiences an increase in the number of beneficiary or provider
complaints or concerns about access to care that suggests possible
noncompliance with the access requirements in section 1902(a)(30)(A) of
the Act, we may take a compliance action. As described in Sec.
447.204(d), compliance actions would be carried out using the
procedures described in Sec. 430.35.
As discussed in the prior section, we are proposing to move current
Sec. 447.203(b)(7) to proposed Sec. 447.203(c)(4). We are not
proposing any changes to the public process described in current
paragraph (b)(7). If the other provisions of this proposed rule are
finalized, we would redesignate paragraph (b)(7) as paragraph (c)(4).
The ability for providers and beneficiaries to provide ongoing feedback
to the State regarding access to care and a beneficiary's ability to
access Medicaid services is essential to the Medicaid program in that
it provides the primary interested parties the opportunity to
communicate with the State and for the State to track and take account
of those interactions in a meaningful way. The ongoing mechanisms for
provider and beneficiary feedback must be retained in this proposed
rule as this process serves an important role in determining whether or
not the public has raised concerns regarding access to Medicaid-covered
services, which would inform the State's approach to ongoing Medicaid
provider payment rates and methodologies, and whether related proposals
would be approvable.
We are proposing to move current Sec. 447.203(b)(8) to proposed
Sec. 447.203(c)(5) to better organize Sec. 447.203 to reflect the
policies in this proposed rule. We are not proposing any changes to the
methods for addressing access questions and remediation of inadequate
access to care, as described in current paragraph (b)(8). If the other
provisions of this proposed rule are finalized, we would redesignate
paragraph (b)(8) as paragraph (c)(5). It is important to retain this
provision because we acknowledge that there may be access issues that
come about apart from a specific State payment rate action, and there
must be mechanisms through which those issues can be identified and
corrective action taken.
Finally, we are proposing to move current Sec. 447.204(d) to
proposed Sec. 447.203(c)(6). We believe the subject matter, of
compliance actions for an access deficiency, is better aligned to the
proposed changes in Sec. 447.203. We are not proposing any changes to
defining the remedy for the identification of an unresolved access
deficiency, as described in current Sec. 447.204(d). If the other
provisions of this proposed rule are finalized, we would redesignate
Sec. 447.204(d) as paragraph (c)(6).
We are seeking public comment on our proposed procedures and
requirements for State analysis for payment rate reduction or payment
restructuring SPAs, including the qualification criteria for
streamlined analysis proposed in Sec. 447.203(c)(1), the proposed
additional analysis elements in Sec. 447.203(c)(2) for those proposed
payment rate reductions or payment restructurings that do not meet the
criteria in paragraph (c)(1), the proposed methods for ensuring
compliance in Sec. 447.203(c)(3), the proposed mechanisms for ongoing
beneficiary and provider input in Sec. 447.203(c)(4), the proposed
methods to address access questions and remediation of inadequate
access to care in Sec. 447.203(c)(5), and the proposed compliance
actions for access deficiencies in Sec. 447.203(c)(6).
4. Medicaid Provider Participation and Public Process To Inform Access
to Care (Sec. 447.204)
In Sec. 447.204, we propose conforming changes to reflect proposed
changes in Sec. 447.203, if finalized. These conforming edits are
limited to Sec. 447.204(a)(1) and (b) and are necessary
[[Page 28037]]
for consistency with the newly proposed changes in Sec. 447.203(b).
The remaining paragraphs of Sec. 447.204 would be unchanged.
Specifically, we propose to update the language of Sec.
447.204(a)(1), which currently references Sec. 447.203, to reference
Sec. 447.203(c). Because we are proposing wholesale revisions to Sec.
447.203(b) and the addition of Sec. 447.203(c), the proposed data and
analysis referenced in the current citation to Sec. 447.203 would be
located more precisely in Sec. 447.203(c). Current Sec. 447.204(b)(1)
refers to the State's most recent AMRP performed under current Sec.
447.203(b)(6) for the services at issue in the State's payment rate
reduction or payment restricting SPA; we propose to remove this
requirement to align with our proposal to rescind the AMRP requirements
in current Sec. 447.203(b). Current Sec. 447.204(b)(2) and (3)
require the State to submit with such a payment SPA an analysis of the
effect of the change in the payment rates on access and a specific
analysis of the information and concerns expressed in input from
affected interested parties; we believe these current requirements are
addressed in proposed Sec. 447.203(c)(1) and (2), as applicable. We
believe that the continued inclusion of these paragraphs (b)(2) and (3)
would be unnecessary or redundant in light of the proposals in Sec.
447.203(c)(1) and (2), if finalized. The objective processes proposed
under Sec. 447.203(c)(1) and (2), which would require States to submit
quantitative and qualitative information with a proposed payment rate
reduction or payment restructuring SPA, would be sufficient for us to
obtain the information necessary to assess the State's proposal with
the same or similar information as currently is required under Sec.
447.204(b)(2) and (3).
With the removal of Sec. 447.204(b)(1) through (b)(3), we propose
to revise Sec. 447.204(b) to read, ``[t]he State must submit to us
with any such proposed State plan amendment affecting payment rates
documentation of the information and analysis required under Sec.
447.203(c) of this chapter.''
Finally, as noted in the previous section, we propose to remove and
relocate Sec. 447.204(d), as we felt the nature of that provision is
better suited to codification in Sec. 447.203(c)(6).
We are seeking public comment on the proposed amendments to Sec.
447.204.
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.
We are soliciting public comment on each of these issues for the
following sections of this document that contain information collection
requirements (see section III.E. of this preamble for further
information). Comments, if received, will be responded to within the
subsequent final rule.
A. Wage Estimates
To derive average costs, we used data from the U.S. Bureau of Labor
Statistics' (BLS's) May 2021 National Occupational Employment and Wage
Estimates for all salary estimates (http://www.bls.gov/oes/current/oes_nat.htm). In this regard, Table 1 presents BLS' mean hourly wage,
our estimated cost of fringe benefits and other indirect costs \226\
(calculated at 100 percent of salary), and our adjusted hourly wage.
---------------------------------------------------------------------------
\226\ https://aspe.hhs.gov/reports/valuing-time-us-department-health-human-services-regulatory-impact-analyses-conceptual-framework.
Table 1--National Occupational Employment and Wage Estimates
----------------------------------------------------------------------------------------------------------------
Fringe
Occupational Mean hourly benefits and Adjusted
Occupation title code wage ($/hr) other indirect hourly wage ($/
costs ($/hr) hr)
----------------------------------------------------------------------------------------------------------------
Administrative Services Manager................. 11-3012 54.34 54.34 108.68
Business Operations Specialist.................. 13-1000 38.64 38.64 77.28
Business Operations Specialist, All Other....... 13-1199 38.10 38.10 76.20
Chief Executive................................. 11-1011 102.41 102.41 204.82
Compensation, Benefits, and Job Analyst......... 13-1141 35.49 35.49 70.98
Computer and Information Analyst................ 15-1210 50.40 50.40 100.80
Computer Programmer............................. 15-1251 46.46 46.46 92.92
Data Entry Keyers............................... 43-9021 17.28 17.28 34.56
General and Operations Manager.................. 11-1021 55.41 55.41 110.82
Human Resources Manager......................... 11-3121 65.67 65.67 131.34
Management Analyst.............................. 13-1111 48.33 48.33 96.66
Social and Community Service Managers........... 11-9151 36.92 36.92 73.84
Social Science Research Assistants.............. 19-4061 27.13 27.13 54.26
Statistician.................................... 15-2041 47.81 47.81 95.62
Survey Researcher............................... 19-3022 31.10 31.10 62.20
Training and Development Specialist............. 13-1151 32.51 32.51 65.02
----------------------------------------------------------------------------------------------------------------
For States and the private sector the employee hourly wage
estimates have been adjusted by a factor of 100 percent. This is
necessarily a rough adjustment, both because fringe benefits and other
indirect costs vary significantly across employers, and because methods
of estimating these costs vary widely across studies. Nonetheless, we
believe
[[Page 28038]]
that there is no practical alternative and that doubling the hourly
wage to estimate total cost is a reasonably accurate estimation method.
We believe that the costs for beneficiaries undertaking
administrative and other tasks on their own time is a post-tax hourly
wage rate of $20.71/hr.
We adopt an hourly value of time based on after-tax wages to
quantify the opportunity cost of changes in time use for unpaid
activities. This approach matches the default assumptions for valuing
changes in time use for individuals undertaking administrative and
other tasks on their own time, which are outlined in an ASPE report on
``Valuing Time in U.S. Department of Health and Human Services
Regulatory Impact Analyses: Conceptual Framework and Best Practices.''
[*] We start with a measurement of the usual weekly earnings of wage
and salary workers of $998. [**] We divide this weekly rate by 40 hours
to calculate an hourly pre-tax wage rate of $24.95. We adjust this
hourly rate downwards by an estimate of the effective tax rate for
median income households of about 17 percent, resulting in a post-tax
hourly wage rate of $20.71. We adopt this as our estimate of the hourly
value of time for changes in time use for unpaid
activities.227 228 Unlike our State and private sector wage
adjustments, we are not adjusting beneficiary wages for fringe benefits
and other indirect costs since the individuals' activities, if any,
would occur outside the scope of their employment.
---------------------------------------------------------------------------
\227\ Department of Health and Human Services, Office of the
Assistant Secretary for Planning and Evaluation. 2017. ``Valuing
Time in U.S. Department of Health and Human Services Regulatory
Impact Analyses: Conceptual Framework and Best Practices.'' https://aspe.hhs.gov/reports/valuing-time-us-department-health-human-services-regulatory-impact-analyses-conceptual-framework.
\228\ U.S. Bureau of Labor Statistics. Employed full time:
Median usual weekly nominal earnings (second quartile): Wage and
salary workers: 16 years and over [LEU0252881500A], retrieved from
FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/LEU0252881500A. Annual Estimate, 2021.
---------------------------------------------------------------------------
B. Adjustment to State Cost Estimates
To estimate the financial burden on States, it was important to
consider the Federal government's contribution to the cost of
administering the Medicaid program. The Federal government provides
funding based on an FMAP that is established for each State, based on
the per capita income in the State as compared to the national average.
FMAPs range from a minimum of 50 percent in States with higher per
capita incomes to a maximum of 83 percent in States with lower per
capital incomes. For Medicaid, all States receive a 50 percent FMAP for
administration. States also receive higher Federal matching rates for
certain systems improvements, redesign, or operations. As such, and
taking into account the Federal contribution to the costs of
administering the Medicaid programs for purposes of estimate State
burden with respect to collection of information, we elected to use the
higher end estimate that the States would contribute 50 percent of the
costs, even though the burden would likely be much smaller.
C. Proposed Information Collection Requirements (ICRs)
1. ICRs Regarding Medicaid Advisory Committee and Beneficiary Advisory
Group (Sec. 431.12)
The following proposed changes will be submitted to OMB for review
under control number 0938-TBD (CMS-10845). At this time, the control
number is to be determined (TBD). OMB will assign the control number
upon their clearance of this new collection of information request. The
control number will be set out in the subsequent final rule (CMS-2442-
F).
Currently, most States have an established Medicaid Advisory
Committee (MAC, previously known as a Medical Care Advisory Committee,
or MCAC) whereby each State has the discretion on how to operate its
MAC. A small number of States also use consumer advisory subcommittees
as part of their MACs, similar to the Beneficiary Advisory Groups
(BAGs) in proposed Sec. 431.12. We reviewed data from 10 States to
determine the current status of MACs and to determine the burden needed
to comply with the proposed Sec. 431.12 requirements across 50 States
and the District of Columbia.
Under the proposed provision, States would be required to:
Appoint members to the MAC and BAG on a rotating and
continuous basis.
Develop and publish a process for MAC and BAG member
recruitment and appointment and selection of MAC and BAG leadership.
Develop and publish:
++ Bylaws for governance of the MAC.
++ A current list of MAC and BAG membership.
++ Past meeting minutes, including a summary from the most recent
BAG Meeting.
Develop, publish, and implement a regular meeting schedule
for the MAC and BAG.
Additionally, the State must provide and post to its website an
annual report written by the MAC to the State describing its
activities, topics discussed, recommendations. The report must also
include actions taken by the State based on the MAC recommendations.
The proposed requirements would require varying levels of effort by
States. For example, a handful of States already have a BAG. However,
we believe that most States will be required to create new structures
and processes. The majority of States reviewed are already meeting some
of the new proposed requirements for MACs, such as publication of
meeting schedules, publication of membership lists, and publication of
bylaws. However, all MAC bylaws would need to be updated to meet the
new proposed requirements. Our review showed that most States are not
currently publishing their recruitment and appointment processes for
MAC members, and those that did would need to update these processes to
meet the new proposed requirements. About half of the States reviewed
published meeting minutes with responses and State actions, as required
under the new proposed requirements. But only one State reviewed
published an annual report, so this will likely be a new requirement
for almost all State MACs. States will not need to modify or build a
reporting systems to create and post these annual reports. Due to the
wide range in the use and maturity of current MCACs across the States,
we are providing a range of estimates to address these variations. We
recognize that some States, which do not currently operate a MCAC, will
have a higher burden to implement the requirements of Sec. 431.12 to
shift to the MAC and BAG structure. However, our research showed that
the majority of States do have processes and procedures for their
current MCACs, which will require updating, but at a much lower burden.
Therefore, we believe it is appropriate to offer average low and high
burden estimates.
For a low estimate, we estimate it would take a team of business
operations specialists 120 hours at $76.20/hr to develop and publish
the processes and report. In aggregate, we estimate an annual burden of
6,120 hours (120 hr/response x 51 responses) at a cost of $466,344
(6,120 hr x $76.20/hr). We also estimate that it would take 40 hours at
$131.34/hr for a human resources manager to review and approve bylaws
and help with recruitment and appointment and selection of MAC and BAG
leadership which would occur every 2 years. In aggregate, we estimate a
biennial burden of 2,040 hours (40 hr/response x 51
[[Page 28039]]
responses) at a cost of $267,934 (2,040 hr x $131.34/hr). Additionally,
we estimate it would take 10 hours at $110.82/hr for an operations
manager to review the updates and prepare the required reports for
annual publication. In aggregate, we estimate an annual burden of 510
hours (10 hr/response x 51 responses) at a cost of $56,518 (510 hr x
$110.82/hr).
We derived the high estimate by doubling the hours from the low
estimate. We used this approach because all States already have a MCAC
requirement which means the type of work being discussed is already
underway in most States and that there is reference point for the type
of work described. For example, we estimate it would take a team of
business operations specialists 240 hours at $76.20/hr to develop and
publish the processes and annual report. In aggregate, we estimate an
annual burden of 12,240 hours (240 hr/response x 51 responses) at a
cost of $932,688 (12,240 hr x $76.20/hr). We also estimate that it
would take 80 hours at $131.34/hr for a human resources manager to
review and approve bylaws and help with recruitment and appointment and
selection of MAC and BAG leadership which would occur every 2 years. In
aggregate, we estimate a biennial burden of 4,080 hours (80 hr/response
x 51 responses) at a cost of $535,867 (4,080 hr x $131.34).
Additionally, we estimate it would take 20 hours at $110.82/hr for an
operations manager to review the updates and prepare the required
annual report for publication. In aggregate, we estimate an annual
burden of 1,020 hours (20 hr/response x 51 responses) at a cost of
$113,036 (1,020 hr x $110.82/hr).
We have summarized the total burden in Table 2. To be conservative
and not underestimate our burden analysis, we are using the high end of
our estimates to score the PRA-related impact of the proposed
requirements.
Table 2--Summary of Burden Estimates for Medical Care Advisory Committee Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 431.12 (develop/publish report) 51 51 Annual................... 240 12,240 76.20 932,688 466,344
Sec. 431.12 (review/approve bylaws). 51 51 Biennial................. 80 4,080 131.34 535,867 267,934
Sec. 431.12 (review updates/prepare 51 51 Annual................... 20 1,020 110.82 113,036 56,518
reports).
-----------------------------------------------------------------------------------------------------------------
Total............................. 51 153 Varies................... Varies 17,340 Varies 1,581,591 790,795
--------------------------------------------------------------------------------------------------------------------------------------------------------
2. ICRs Regarding Person-Centered Service Plans (Sec. 441.301(c)(3);
Cross-Referenced to Sec. Sec. 441.450(c), 441.540(c), and 441.725(c),
and Part 438)
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
Section 1915(c)(1) of the Act requires that services provided
through section 1915(c) waiver programs be provided under a written
plan of care (hereinafter referred to as ``person-centered service
plans'' or ``service plans''). Existing Federal regulations at Sec.
441.301(c) address the person-centered planning process and include a
requirement at Sec. 441.301(c)(3) that the person-centered service
plan be reviewed and revised upon reassessment of functional need, at
least every 12 months, when the individual's circumstances or needs
change significantly or at the request of the individual.
In 2014, we released guidance for section 1915(c) waiver programs
\229\ (hereinafter the ``2014 guidance'') that included expectations
for State reporting of State-developed performance measures to
demonstrate compliance with section 1915(c) of the Act and the
implementing regulations in part 441, subpart G through six assurances,
including assurances related to person-centered service plans. The 2014
guidance also indicated that States should conduct systemic remediation
and implement a Quality Improvement Project when they score below an 86
percent threshold on any of their performance measures. Based on
feedback CMS obtained during various public engagement activities
conducted with States and other interested parties over the past
several years about the reporting discussed in the 2014 guidance, as
well as feedback received through the RFI \230\ discussed earlier about
the need to standardize reporting and set minimum standards for HCBS,
we are proposing a different approach for States to demonstrate that
they meet the statutory requirements in section 1915(c) of the Act and
the regulatory requirements in part 441, subpart G, including the
requirements regarding assurances around service plans.
---------------------------------------------------------------------------
\229\ Modifications to Quality Measures and Reporting in Sec.
1915(c) Home and Community-Based Waivers. March 2014. Accessed at
https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_2.pdf.
\230\ CMS Request for Information: Access to Coverage and Care
in Medicaid & CHIP. February 2022. For a full list of question from
the RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
---------------------------------------------------------------------------
Within this rule we propose to replace expectations for State
reporting of State-developed performance measures and the 86 percent
performance threshold included in the 2014 guidance and codify
requirements for reporting on standardized measures and a minimum
performance level for States to demonstrate that they meet the existing
person-centered service plan requirements at Sec. 441.301(c)(3).
Specifically, at new Sec. 441.301(c)(3)(ii)(A), we propose to require
that States demonstrate that a reassessment of functional need was
conducted at least annually for at least 90 percent of individuals
continuously enrolled in the waiver for at least 365 days. We also
propose, at new Sec. 441.301(c)(3)(ii)(B), to require that States
demonstrate that they reviewed the person-centered service plan and
revised the plan as appropriate based on the results of the required
reassessment of functional need at least every 12 months for at least
90 percent of individuals continuously enrolled in the waiver for at
least 365 days. At
[[Page 28040]]
Sec. 441.311(b)(3), we propose to modernize the service plan reporting
requirement by standardizing State reporting through new Federal
reporting requirements. These performance and reporting requirements,
in combination with other proposed requirements \231\ identified
throughout this proposed rule, are intended to supersede and fully
replace existing reporting requirements and required performance levels
for section 1915(c) waiver programs, which were established through the
2014 guidance discussed earlier.\232\ We propose to apply these
requirements to services delivered under FFS or managed care delivery
systems. Further, we propose to apply the proposed requirements at
Sec. 441.301(c)(3) to sections 1915(j), (k), and (i) State plan
services by cross-referencing at Sec. Sec. 441.450(c), 441.540(c), and
441.725(c), respectively. In addition, we propose to reposition,
specify, and remove extraneous language from Sec. 441.301(c)(1).
---------------------------------------------------------------------------
\231\ The other requirements relate to incident management,
critical incident, person centered planning, and service provision
compliance reporting; reporting on the HCBS Quality Measure Set;
access reporting; and payment adequacy reporting.
\232\ Modifications to Quality Measures and Reporting in Sec.
1915(c) Home and Community-Based Waivers. March 2014 Accessed at
https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_71.pdf.
---------------------------------------------------------------------------
a. One Time Person-Centered Service Plan Requirements: State (Sec.
441.301(c)(3))
As discussed above, at new Sec. 441.301(c)(3)(ii)(A), we propose
to require that States demonstrate that a reassessment of functional
need was conducted at least annually for at least 90 percent of
individuals continuously enrolled in the waiver for at least 365 days.
We also propose, at new Sec. 441.301(c)(3)(ii)(B), to require that
States demonstrate that they reviewed the person-centered service plan
and revised the plan as appropriate based on the results of the
required reassessment of functional need at least every 12 months for
at least 90 percent of individuals continuously enrolled in the waiver
for at least 365 days. The burden associated with the person-centered
service plan reporting requirements proposed at Sec.
441.301(c)(3)(ii)(A) and (B) will affect the 48 States (including the
District of Columbia) that deliver HCBS under sections 1915(c), (i),
(j), or (k) authorities.\233\ We anticipate that States will need to
update State policy and oversight and monitoring processes related to
the codification of the new 90 percent minimum performance level
associated with requirements.
---------------------------------------------------------------------------
\233\ Arizona, Rhode Island, and Vermont do not have HCBS
programs under any of these authorities.
---------------------------------------------------------------------------
However, because we are codifying a minimum performance level
associated with existing regulations but not otherwise changing the
regulatory requirements under Sec. 441.301(c)(3)(ii)(A) and (B), we do
not estimate any additional burden related to those requirements. We
also hold that there is no additional burden associated with
repositioning, specifying, and removing extraneous language from the
regulatory text at Sec. 441.301(c)(1). In this regard we are only
estimating burden for updating State policy and oversight and
monitoring processes related to the codification of the new 90 percent
minimum performance level associated with requirements.
We estimate it would take 8 hours at $108.68/hr for an
administrative services manager to update State policy and oversight
and monitoring processes, 2 hours at $110.82/hr for a general and
operations manager to review and approve the updates to State policy
and oversight and monitoring processes, and 1 hour at $204.82/hr for a
chief executive to review and approve the updates to State policy and
oversight and monitoring processes. In aggregate, we estimate a one-
time burden of 528 hours (48 States x [8 hr + 2 hr + 1 hr]) at a cost
of $62,203 (48 States x [(8 hr x $108.68/hr) + (2 hr x $110.82/hr) + (1
hr x $204.82/hr)]). Taking into account the Federal contribution to
Medicaid administration, the estimated State share of this cost would
be $31,102 ($62,203 x 0.50).
Table 3--Summary of One-Time Burden Estimates for States for the Person-Centered Service Plan Requirements at Sec. 441.301(c)(3)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Update State policy and oversight and 48 48 Once..................... 8 384 108.68 41,733 20,867
monitoring processes.
Review and approval of State policy 48 48 Once..................... 2 96 110.82 10,639 5,319
update at the management level.
Review and approval of State policy 48 48 Once..................... 1 48 204.82 9,831 4,916
update at the chief executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 144 Once..................... 11 528 Varies 62,203 31,102
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. One Time Person-Centered Service Plan Requirements: Managed Care
Entities (Sec. 441.301(c)(3))
As discussed earlier in sections II.B.1 of this preamble, we are
proposing to also apply, to managed care delivery systems, the
requirements at Sec. 441.301(c)(3) to demonstrate that a reassessment
of functional need was conducted at least annually for at least 90
percent of individuals continuously enrolled in the waiver for at least
365 days and to demonstrate that they reviewed the person centered
service plan and revised the plan as appropriate based on the results
of the required reassessment of functional need at least every 12
months for at least 90 percent of individuals continuously enrolled in
the waiver for at least 365 days. As with the burden estimate for
States, we do not estimate an ongoing burden related to the
codification of a minimum performance level associated with the
requirements at Sec. 441.301(c)(3).
For managed care entities we estimate it would take 5 hours at
$108.68/hr for an administrative services manager to update
organizational policy and oversight and monitoring processes related to
the codification of a new minimum performance level and 1 hour at
$204.82/hr for a chief executive to review and approve the updates to
organizational policy and oversight and monitoring processes. In
aggregate, we estimate a one-time burden of 966 hours (161 managed care
entities x [5 hr + 1 hr]) at a cost of $120,463 (161 managed care
entities x [(5 hr x $108.68/hr) + (1 hr x $204.82/hr)]).
[[Page 28041]]
Table 4--Summary of One-Time Burden Estimates for Managed Care Entities (MCEs) for the Person-Centered Service Plan Requirements at Sec. 441.301(c)(3)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Update organizational policy and 161 161 Once..................... 5 805 108.68 87,487 n/a
oversight and monitoring processes.
Review and approval of policy and 161 161 Once..................... 1 161 204.82 32,976 n/a
oversight and monitoring processes.
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 322 Once..................... 6 966 Varies 120,463 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
3. ICRs Regarding Grievance System (Sec. 441.301(c)(7); Cross-
Referenced to Sec. Sec. 441.464(d)(2)(v), 441.555(b)(2)(iv), and
441.745(a)(1)(iii), and Part 438)
At Sec. 441.301(c)(7), we propose to require that States establish
grievance procedures for Medicaid beneficiaries receiving section
1915(c) waiver program services through a FFS delivery system to file a
complaint or expression or dissatisfaction related to the State's or a
provider's compliance with the person-centered planning and service
plan requirements at Sec. 441.301(c)(1) through (3) and the HCBS
settings requirements at Sec. 441.301(c)(4) through (6).
Proposed Sec. 441.301(c)(7)(vii) lists proposed recordkeeping
requirements related to grievances. Specifically, at Sec.
441.301(c)(7)(vii)(A), we propose to require that States maintain
records of grievances and review the information as part of their
ongoing monitoring procedures. At Sec. 441.301(c)(7)(vii)(B)(1)
through (7), we propose to require that the record of each grievance
must contain the following information at a minimum: a general
description of the reason for the grievance, the date received, the
date of each review or review meeting (if applicable), resolution and
date of the resolution of the grievance (if applicable), and the name
of the beneficiary for whom the grievance was filed. Further, at Sec.
441.301(c)(7)(vii)(C), we propose to require that grievance records be
accurately maintained and in a manner that would be available upon our
request.
We also propose to apply these proposed requirements in Sec.
441.301(c)(7) to sections 1915(j), (k), and (i) State plan services by
cross-referencing at Sec. Sec. 441.464(d)(2)(v), 441.555(b)(2)(iv),
and 441.745(a)(1)(iii), respectively. However, to avoid duplication
with the grievance requirements at part 438, subpart F, we do not
propose to apply these requirements to managed care delivery systems.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our reporting tools
and survey instrument has been developed. The survey instrument and
burden will be made available to the public for their review under the
standard non-rule PRA process which includes the publication of 60- and
30-day Federal Register notices. In the meantime, we are setting out
our preliminary burden figures (see below) as a means of scoring the
impact of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
a. States
The burden associated with the grievance system requirements
proposed at Sec. 441.301(c)(7) will affect the 48 States (including
the District of Columbia) that deliver at least some HCBS under
sections 1915(c), (i), (j), or (k) authorities through FFS delivery
systems.234 235 While some States may have existing
grievance systems in place for their FFS delivery systems, we are
unable to determine the number of States with existing grievance
systems or whether those grievance systems would meet the proposed
requirements at Sec. 441.301(c)(7). As a result, we do not take this
information into account in our burden estimate. We estimate a one-time
and on-going burden to implement these requirements at the State level.
---------------------------------------------------------------------------
\234\ Arizona, Rhode Island, and Vermont do not have HCBS
programs under any of these authorities.
\235\ While some States deliver the vast majority of HCBS
through managed care delivery systems, States would be subject to
these requirements if they deliver any HCBS under section 1915(c),
(i), (j), or (k) authorities through a fee-for service delivery
system. Based on data showing that the percent of LTSS expenditures
delivered through managed LTSS delivery systems varied between 3
percent and 93 percent in 2019 across all States with managed LTSS,
we assume that all States deliver at least some HCBS through fee-
for-service delivery systems (https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltssexpenditures2019.pdf). We
anticipate that the burden associated with implementing these
requirements will be lower for States that deliver the vast majority
of HCBS through managed care delivery systems.
---------------------------------------------------------------------------
Specifically, States will have to: (1) develop and implement
policies and procedures; (2) establish processes and data collection
tools for accepting, tracking, and resolving, within required
timeframes, beneficiary grievances, including processes and tools for:
providing beneficiaries with reasonable assistance with filing a
grievance, for accepting grievances orally and in writing, for
reviewing grievance resolutions with which beneficiaries are
dissatisfied, and for providing beneficiaries with a reasonable
opportunity to present evidence and testimony and make legal and
factual arguments related to their grievance; (3) inform beneficiaries,
providers, and subcontractors about the grievance system; and (4)
develop beneficiary notices; and collect and maintain information on
each grievance, including the reason for the grievance, the date
received, the date of each review or review meeting (if applicable),
resolution and date of the resolution of the grievance (if applicable),
and the name of the beneficiary for whom the grievance was filed.
i. One-Time Grievance System Requirements: States (Sec. 441.301(c)(7))
With regard to the one-time requirements, we estimate it would
take: 240 hours at $108.68/hr for an administrative services manager to
draft policy and procedure content, prepare notices and informational
materials, draft rules for publication, and conduct public hearings;
100 hours at $92.92/hr for a computer programmer to build, design, and
operationalize internal systems for data collection and tracking; 120
hours at $65.02/hr for a training and development specialist to develop
and conduct training for staff; 40 hours at $110.82/hr for a general
and operations manager to review and approve policies, procedures,
rules for publication, notices, and training materials; and 20
[[Page 28042]]
hours at $204.82/hr for a chief executive to review and approve all
operations associated with this collection of information requirement.
In aggregate, we estimate a one-time burden of 24,960 hours (520 hr x
48 States) at a cost of $2,481,926 (48 States x [(240 hr x $108.68/hr)
+ (100 hr x $92.92/hr) + (120 hr x $65.02/hr) + (40 hr x $110.82/hr) +
(20 hr x $204.82/hr)]). Taking into account the Federal contribution to
Medicaid administration, the estimated State share of this cost would
be $1,240,963 ($2,481,926 x 0.50).
Table 5--Summary of One-Time Burden Estimates for States for the Grievance System Requirements at Sec. 441.301(c)(7)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft policy and procedures, rules for 48 48 Once..................... 240 11,520 108.68 1,251,994 625,997
publication; prepare beneficiary
notices, informational materials;
conduct public hearings.
Build, design, operationalize internal 48 48 Once..................... 100 4,800 92.92 446,016 223,008
systems for data collection and
tracking.
Develop and conduct training for staff 48 48 Once..................... 120 5,760 65.02 374,515 187,258
Review and approve policies, 48 48 Once..................... 40 1,920 110.82 212,774 106,387
procedures, rules for publication,
notices, and training materials at
the management level.
Review and approve all operations in 48 48 Once..................... 20 960 204.82 196,627 98,314
collection of information requirement
at the chief executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 240 Once..................... 520 24,960 Varies 2,481,926 1,240,964
--------------------------------------------------------------------------------------------------------------------------------------------------------
ii. Ongoing Grievance System Requirements: States (Sec. 441.301(c)(7))
With regard to the on-going requirements, we estimate that
approximately 2 percent of 1,460,363 Medicaid beneficiaries who receive
HCBS under section 1915(c), (i), (j), or (k) authorities through FFS
delivery systems annually \236\ will file a grievance or appeal (29,207
grievances = 1,460,363 x 0.02).\237\ We estimate it would take: 0.333
hours or 20 minutes at $76.20/hr for a business operations specialist
to collect the required information for each grievance from the
beneficiary, 0.166 hours or 10 minutes at $34.56/hr for a data entry
worker to record the required information on each grievance, 20 hours
at $92.92/hr for a computer programmer to maintain the system for
storing information on grievances, 12 hours at $110.82/hr for a general
and operations manager to monitor and oversee the collection and
maintenance of the required information, and 2 hours at $204.82/hr for
a chief executive to review and approve all operations associated with
this collection of information requirement. In aggregate, we estimate
an on-going burden of 16,206 hours at a cost of $1,081,374 ([(29,207
grievances x 0.333 hr x $76.20/hr) + (29,207 grievances x 0.166 hr x
$34.56/hr) + (48 States x 20 hr x $92.92/hr) + (48 States x 12 hr x
$110.82/hr) + (48 States x 2 hr x $204.82/hr)]). Taking into account
the Federal contribution to Medicaid administration, the estimated
State share of this cost would be $540,687 ($1,081,374 x 0.50) per
year.
---------------------------------------------------------------------------
\236\ https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-user-brief-2019.pdf.
\237\ We based this percent on an estimate of the percent of
Medicaid beneficiaries that file appeals and grievances in Medicaid
managed care in Supporting Statement A for the information
collection requirements for the Medicaid managed care file rule
(CMS-2408-F, RIN 0938-AT40). See https://omb.report/icr/202205-0938-015/doc/121334100 for more information.
Table 6--Summary of Ongoing Burden for States for the Grievance System Requirements at Sec. 441.301(c)(7)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Collect required grievance data and 48 29,207 On occasion.............. 0.333 9,726 76.20 741,116 370,558
information.
Enter required grievance data and 48 29,207 On occasion.............. 0.166 4,848 34.56 167,559 83,780
information into data collection and
tracking system.
Perform maintenance on system for 48 48 Annually................. 20 960 92.92 89,203 44,602
storing data and information on
grievances.
Monitor and oversee the collection and 48 48 Annually................. 12 576 110.82 63,832 31,916
maintenance of the required
information at the management level.
Review and approve all operations 48 48 Annually................. 2 96 204.82 19,663 9,831
associated with collection of
information requirement at the
executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 58,558 Varies................... Varies 16,206 Varies 1,081,374 540,687
--------------------------------------------------------------------------------------------------------------------------------------------------------
4. ICRs Regarding Incident Management System (Sec. 441.302(a)(6);
Cross-Referenced to Sec. Sec. 441.464(e), 441.570(e),
441.745(a)(1)(v), and Part 438)
At Sec. 441.302(a)(6), we propose to require that States provide
an assurance that they operate and maintain an incident management
system that identifies, reports, triages, investigates, resolves,
tracks, and trends critical incidents. At Sec. 441.302(a)(6)(i)(A), we
propose to establish a minimum standard definition of a critical
incident. At Sec. 441.302(a)(6)(i)(B), we propose to require that
States have electronic incident management systems that, at a minimum,
enable electronic collection, tracking (including of the status and
[[Page 28043]]
resolution of investigations), and trending of data on critical
incidents. At Sec. 441.302(a)(6)(i)(C), we propose to require States
to require providers to report to States any critical incidents that
occur during the delivery of section 1915(c) waiver program services as
specified in a waiver participant's person-centered service plan, or
are a result of the failure to deliver authorized services. At Sec.
441.302(a)(6)(i)(D), we propose to require that States use claims data,
Medicaid Fraud Control Unit data, and data from other State agencies
such as Adult Protective Services or Child Protective Services to the
extent permissible under applicable State law to identify critical
incidents that are unreported by providers and occur during the
delivery of section 1915(c) waiver program services, or as a result of
the failure to deliver authorized services. At Sec.
441.302(a)(6)(i)(E), we propose to require that States share
information on the status and resolution of investigations if the State
refers critical incidents to other entities for investigation. We also
propose, at Sec. 441.302(a)(6)(i)(F), to require States to separately
investigate critical incidents if the investigative agency fails to
report the resolution of an investigation within State-specified
timeframes. At Sec. 441.302(a)(6)(i)(G), we propose to require that
States meet the reporting requirements at Sec. 441.311(b)(1) related
to the performance of their incident management systems. We also
propose to codify minimum performance levels to demonstrate that States
meet the requirements at Sec. 441.302(a)(6). These performance and
reporting requirements, in combination with other proposed requirements
identified throughout this proposed rule, are intended to supersede and
fully replace existing reporting requirements and required performance
levels for section 1915(c) waiver programs, which were established in
2014.\238\
---------------------------------------------------------------------------
\238\ Modifications to Quality Measures and Reporting in Sec.
1915(c) Home and Community-Based Waivers. March 2014 Accessed at
https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_71.pdf.
---------------------------------------------------------------------------
At Sec. 441.302(a)(6)(iii), we propose to apply these requirements
to services delivered under FFS or managed care delivery systems. We
also propose to apply the proposed requirements Sec. 441.302(a)(6) to
sections 1915(j), (k), and (i) State plan services by cross-referencing
at Sec. Sec. 441.570(e), 441.464(e), and 441.745(a)(1)(v),
respectively.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
a. States
The burden associated with the incident management system
requirements proposed at Sec. 441.302(a)(6) will affect the 48 States
(including Washington, DC) that deliver HCBS under section 1915(c),
(i), (j), or (k) authorities.\239\ We estimate a one-time and on-going
burden to implement these requirements at the State level. The burden
for the proposed reporting requirements at Sec. 441.311(b)(1) is
included in the ICR #8, which is the ICRs Regarding Compliance
Reporting (Sec. 441.311(b)).
---------------------------------------------------------------------------
\239\ Arizona, Rhode Island, and Vermont do not have HCBS
programs under any of these authorities.
---------------------------------------------------------------------------
All of the States impacted by Sec. 441.302(a)(6)(i)(B), requiring
that States use an information system, as defined in 45 CFR 164.304 and
compliant with 45 CFR part 164, have existing incident management
systems in place. However, we assume that all States will need to make
at least some changes to their existing systems to fully comply with
the proposed requirements. Specifically, States will have to update
State policies and procedures; implement new or update existing
electronic incident management systems; publish revised provider
requirements through State notice and publication processes; update
provider manuals and other policy guidance; amend managed care
contracts; collect required information from providers; use other
required data sources to identify unreported incidents; and share
information with other entities in the State responsible for
investigating critical incidents.
i. One Time Incident Management System Requirements: States (Sec.
441.302(a)(6))
With regard to the one-time requirements related to proposed Sec.
441.302(a)(6), we estimate it would take: 120 hours at $108.68/hr for
an administrative services manager to draft policy content, prepare
notices and draft rules for publication, conduct public hearings, and
draft contract modifications for managed care plans; 20 hours at
$96.66/hr for a management analyst to update provider manuals; 80 hours
at $65.02/hr for a training and development specialist to develop and
conduct training for providers; 80 hours at $76.20/hr for a business
operations specialist to establish processes for information sharing
with other entities; 80 hours at $100.80/hr for a computer and
information analyst to build, design, and implement reports for using
claims and other data to identify unreported incidents; 24 hours at
$110.82/hr for a general and operations manager to review and approve
managed care contract modifications, policy and rules for publication,
and training materials; and 10 hours at $204.82/hr for a chief
executive to review and approve all operations associated with this
requirement.
In aggregate, we estimate a one-time burden of 19,872 hours (414 hr
x 48 States) at a cost of $1,874,125 (48 States x [(120 hr x $108.68/
hr) + (20 hr x $96.66/hr) + (80 hr x $65.02/hr) + (80 hr x $76.20/hr) +
(80 hr x $100.80/hr) + (24 hr x $110.82/hr) + (10 hr x $204.82/hr)]).
Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be
$937,063 ($1,874,125 x 0.50).
In addition, we estimate that States, based on the results of the
incident management system assessment discussed earlier in section
II.B.3. of this preamble, that 82 percent of States, or 39 States (48
States x 0.82), would need to update existing electronic incident
management systems, while the remaining 9 States would need to
implement new electronic incident management systems, to meet the
proposed requirement at Sec. 441.302(a)(6)(i)(B). We estimate based on
information reported by some States in spending plans for section 9817
of the American Rescue Plan Act of 2021 that the cost per State to
update existing electronic systems is $2 million while the cost per
State to implement new electronic systems is $5 million.\240\ In
[[Page 28044]]
aggregate, we estimate a one-time technology burden of $123,000,000
[($2,000,000 x 39 States) + ($5,000,000 x 9 States)]. Taking into
account the Federal contribution to Medicaid administration, the
estimated State share of this cost would be $ 61,500,000 ($123,000,000
x 0.50).
---------------------------------------------------------------------------
\240\ Enhanced Federal Financial Participation (FFP) is
available at a 90 percent Federal Medical Assistance Percentage
(FMAP) rate for the design, development, or installation of
improvements of mechanized claims processing and information
retrieval systems, in accordance with applicable Federal
requirements. Enhanced FFP at a 75 percent FMAP rate is also
available for operations of such systems, in accordance with
applicable Federal requirements. However, the receipt of these
enhanced funds is conditioned upon States meeting a series of
standards and conditions to ensure investments are efficient and
effective. As a result, we do not assume for the purpose of this
burden estimate that States will qualify for the enhanced Federal
match. This estimate overestimates State burden to the extent that
States qualify for the enhanced Federal match.
Table 7--Summary of One-Time Burden for States for the Incident Management System Requirements (Sec. 441.302(a)(6))
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/hr) Total cost ($) State share
respondents responses (hr) time (hr) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft policy content, prepare 48 48 Once............ 120 5,760 108.68/hr....... 625,997 312,998
notices and draft rules for
publication, conduct public
hearings, and draft contract
modifications for managed
care plans.
Update provider manuals....... 48 48 Once............ 20 960 96.66/hr........ 92,794 46,397
Develop and conduct training 48 48 Once............ 80 3,840 65.02/hr........ 249,677 124,838
for providers.
Establish processes for 48 48 Once............ 80 3,840 76.20/hr........ 292,608 146,304
information sharing with
other entities.
Build, design, and implement 48 48 Once............ 80 3,840 100.80/hr....... 387,072 193,536
reports for using claims and
other data to identify
unreported incidents.
Review and approve managed 48 48 Once............ 24 1,152 110.82/hr....... 127,665 63,832
care contract modifications,
policy and rules for
publication, and training
materials at the management
level.
Review and approve all 48 48 Once............ 10 480 204.82/hr....... 98,314 49,157
operations associated with
this requirement at the
executive level.
Subtotal Labor-Related Burden. 48 336 Once............ Varies 19,872 Varies.......... 1,874,125 937,063
Update existing electronic 39 39 Once............ n/a n/a 2,000,000/system 78,000,000 39,000,000
incident management systems.
Implement new electronic 9 9 Once............ n/a n/a 5,000,000/system 45,000,000 22,500,000
systems.
Subtotal Non-Labor Burden..... 48 48 Once............ n/a n/a Varies.......... 123,000,000 61,500,000
-------------------------------------------------------------------------------------------------------------------------
Total..................... 48 384 Once............ 414 19,872 Varies.......... 124,874,125 62,437,063
--------------------------------------------------------------------------------------------------------------------------------------------------------
ii. Ongoing Incident Management System Requirements: States (Sec.
441.302(a)(6))
With regard to the ongoing requirements Sec. 441.302(a)(6), we
estimate that there are 0.5 critical incidents annually \241\ for each
of the 1,889,640 Medicaid beneficiaries who receive HCBS under sections
1915(c), (i), (j), or (k) authorities annually, or 944,820 (1,889,640 x
0.5) critical incidents annually.\242\ We further estimate that, based
on data on unreported incidents, these requirements will result in the
identification of 30 percent more critical incidents annually, or
283,446 (944,820 x 0.3) critical incidents; \243\ that 76 percent, or
215,419 (283,446 x 0.76) will be reported for individuals enrolled in
FFS delivery systems; \244\ and that 10 percent of those for
individuals enrolled in FFS delivery systems (21,542 = 215,419 x 0.1)
will be made through provider reports and 90 percent (193,877 = 215,419
x 0.9) through claims identification and other sources.\245\ We
estimate 0.166 hr or 10 minutes at $34.56/hr for a data entry worker to
record the information on each reported critical incident reported by
providers for individuals enrolled in FFS delivery systems. In
aggregate, we estimate an ongoing burden each year of 3,576 hours
(21,542 incidents x 0.166 hr) at a cost of $123,587 (3,576 hr x $34.56/
hr) to record the information on each reported critical incident
reported by providers for individuals enrolled in FFS delivery systems.
While States can establish different processes for the reporting of
critical incidents for individuals enrolled in managed care, we assume
for the purpose of this analysis that the States would delegate
provider reporting critical incidents and identification of critical
incidents through claims and other data sources to managed care
entities and that the managed care entities would be responsible for
reporting the identified critical incidents to the State.\246\ We
further assume that the information reported by managed care entities
to the State and identified by the State through claims and other data
sources would be in an electronic form. For the 68,027 more critical
incidents for individuals enrolled in managed care (283,446 more
critical incidents identified x 24 percent
[[Page 28045]]
for individuals enrolled in managed care), and the 193,877 more
critical incidents identified through claims and other data sources for
individuals enrolled in FFS (283,446 more critical incidents identified
x 76 percent for individuals enrolled in FFS x 90 percent identified
through claims and other sources), we estimate 2 minutes (0.0333 hr) at
$34.56/hr for a data entry worker to record the information on each of
these 261,904 critical incidents (68,027 + 193,877). In aggregate, for
Sec. 441.302(a)(6), we estimate an ongoing annual burden of 8,721
hours (261,904 incidents x 0.0333 hr) at a cost of $301,398 (8,721 hr x
$34.56/hr) on these critical incidents.
---------------------------------------------------------------------------
\241\ Data on the number of critical incidents is limited. We
base our estimate on available public information, such as https://oig.hhs.gov/oas/reports/region7/71806081.pdf and https://dhs.sd.gov/servicetotheblind/docs/2015%20CIR%20Annual%20Trend%20Analysis.pdf.
\242\ https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-user-brief-2019.pdf.
\243\ Data on the number of unreported critical incidents is
limited. We base our estimate on available public information, such
as https://pennlive.com/news/2020/01/possible-abuse-of-group-home-residents-wasnt-adequately-tracked-in-pa-federal-audit.html and
https://www.kare11.com/article/news/local/federal-audit-finds-maine-dhhs-failed-to-investigate-multiple-deaths-critical-incidents/97-463258015.
\244\ https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-user-brief-2019.pdf.
\245\ Data is limited on the identification of critical
incidents through various data sources. We conservatively assume
that 25 percent of more critical incidents identified as a result of
these requirements will be reported by providers even though claims
data will likely identify a substantially higher of percentage of
claims than will be reported by providers.
\246\ Addressing Critical Incidents in the MLTSS Environment:
Research Brief, ASPE, https://aspe.hhs.gov/reports/addressing-critical-incidents-mltss-environment-research-brief-0.
---------------------------------------------------------------------------
In total, for Sec. 441.302(a)(6), we estimate an ongoing burden
each year of 12,297 hours (3,576 hours + 8,721 hours) at a cost of
$424,985 ($123,587 + $301,398) to record the information on all
critical incidents for individuals enrolled in FFS and managed care
delivery systems across all States. We further estimate it would take
12 hours at $76.20/hr for a business operations specialist to maintain
processes for information sharing with other entities; 20 hours at
$100.80/hr for a computer and information analyst to update and
maintain reports for using claims and other data to identify unreported
incidents; 24 hours at $110.82/hr for a general and operations manager
to monitor the operations associated with this requirement; and 4 hours
at $204.82/hr for a chief executive to review and approve all
operations associated with this collection of information requirement
in each State. In aggregate, we estimate an ongoing burden of 15,177
hours ([60 hr x 48 States] + 12,297 hr) at a cost of $732,617 ($424,985
+ [48 States x ((12 hr x $76.20/hr) + (20 hr x $100.80/hr) + (24 hr x
$110.82/hr) + 4 hr x $204.82/hr)]). In addition, we estimate an on-
going annual technology-related cost of $500,000 per State for States
to maintain their electronic incident management systems. In aggregate,
we estimate an ongoing burden of $24,000,000 ($500,000 x 48 States) for
States to maintain their electronic incident management systems. In
total, we estimate an ongoing annual burden of 15,177 hours at a cost
$24,732,617 ($732, 617 + $24,000,000). Taking into account the Federal
contribution to Medicaid administration, the estimated State share of
this cost would be $12,366,309 ($24,732,617 x 0.50). Taking into
account the Federal contribution to Medicaid administration, the
estimated State share of this cost would be $12,366,309 ($24,732,617 x
0.50).
Table 8--Summary of Ongoing Burden for States for the Incident Management System Requirements at Proposed Sec. 441.302(a)(6)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Number of Total Time per Total time State share
Requirement respondents responses Frequency response (hr) (hr) Wage ($/hr) Total cost ($) ($)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Record the information on each reported 48 21,542 Annually.................. 0.166 3,576 34.56/hr.................. 123,587 61,793
critical incident reported by providers
for individuals enrolled in FFS
delivery systems.
Record the information on critical 48 261,904 Annually.................. 0.033 8,721 34.56/hr.................. 301,398 150,699
incidents for individuals enrolled in
managed care and critical incidents
identified through claims and other
data sources for individuals enrolled
in FFS.
Maintain processes for information 48 48 Annually.................. 12 576 76.20/hr.................. 43,891 21,946
sharing with other entities.
Update and maintain reports for using 48 48 Annually.................. 20 960 100.80/hr................. 96,768 48,384
claims and other data to identify
unreported incidents.
Monitor operations associated with this 48 48 Annually.................. 24 1,152 110.82/hr................. 127,664.64 63,832
requirement at the management level.
Review and approve all operations 48 48 Annually.................. 4 192 204.82/hr................. 39,325.44 19,662.72
associated with this collection of
information requirement at the
executive level.
Subtotal: Labor Related Burden.......... 48 283,638 Annually.................. Varies 15,177 Varies.................... 732,634 366,317
Maintain electronic incident management 48 48 Annually.................. n/a n/a 500,000/system............ 24,000,000 12,000,000
systems (specifically, Sec.
441.302(a)(6)(i)(B)).
Total Technology Cost................... 48 48 Annually.................. n/a n/a 500,000/system............ 24,000,000 12,000,000
-------------------------------------------------------------------------------------------------------------------------------------------------------
Total............................... 48 283,638 Annually.................. Varies 15,177 Varies.................... 24,732,634 12,366,317
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
b. Service Providers and Managed Care Contractors
The burden associated with this proposed rule would affect service
providers that provide HCBS under sections 1915(c), (i), (j), and (k)
authorities, as well as managed care entities that contract with the
States to provide managed long-term services and supports.
The following discussion estimates an ongoing burden for service
providers to implement these requirements and both a one-time and
ongoing burden for managed care contractors.
[[Page 28046]]
i. On-Going Incident Management System Requirements: Service Provider
To estimate the number of service providers that would be impacted
by this proposed rule, we used unpublished data from the Provider
Relief Fund to estimate that there are 19,677 providers nationally
across all payers delivering the types of HCBS that are delivered under
sections 1915(c), (i), (j), and (k) authorities. We then prorate the
number to estimate the number of providers in the 48 States that are
subject to this requirement (19,677 providers nationally x 48 States
subject to the proposed requirement/51 States = 18,520 providers). We
used data from the Centers for Disease Control and Prevention \247\ to
estimate the percentage of these HCBS providers that participate in
Medicaid and, due to uncertainty in the data and differences in
provider definitions, estimate both a lower and upper range of
providers affected. At a low end of 78 percent Medicaid participation,
we estimate that there are 14,446 providers impacted (18,520 providers
x 0.78), while at a high end of 85 percent participation, we estimate
that there are 15,742 providers impacted (18,520 providers x 0.85). To
be conservative and not underestimate our projected burden analysis, we
are using the high end of our estimates to score the PRA-related impact
of the proposed requirements.
---------------------------------------------------------------------------
\247\ https://www.cdc.gov/nchs/data/series/sr_03/sr03_43-508.pdf.
---------------------------------------------------------------------------
As discussed earlier, we estimate that providers will report 10
percent, or 28,345, of the more critical incidents (283,446 more
critical incidents x 0.10) identified annually as a result of these
requirements. Based on these figures, we estimate that, on average,
each provider will report 1.8 (28,345 incidents/15,742 providers) more
critical incidents annually. We further estimate that, on average, it
would take a provider 1 hour at $110.82/hr for a general and operations
manager to collect the required information and report the information
to the State or to the managed care entity as appropriate for each
incident.\248\ In aggregate, for Sec. 441.302(a)(6), we estimate an
ongoing burden of 28,345 hours (28,345 incidents x 1 hr) at a cost of
$3,141,193 (28,345 hr x $110.82/hr).
---------------------------------------------------------------------------
\248\ The actual amount of time for each incident will vary
depending on the nature of the critical incident and the specific
reporting requirements of each State and managed care entity. This
estimate assumes that some critical incidents will take
substantially less time to report, while others could take
substantially less time.
Table 9--Summary of Ongoing Burden for Service Providers for the Incident Management System Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total responses Frequency response Total Wage ($/ Total State
respondents (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Collect the required information 15,742 providers.... 28,345 incidents... Annually........... 1 28,345 110.82 3,141,193 n/a
and report the information to
the State or to the managed care
entity (Sec.
441.302(a)(6)(i)(C)).
----------------------------------------------------------------------------------------------------------------------
Total........................ 15,742 providers.... 28,345 incidents... Annually........... 1 28,345 110.82 3,141,193 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
ii. One Time Incident Management System Requirements: Managed Care
Entities (Sec. 441.302(a)(6))
As required under proposed Sec. 441.302(a)(6), while States can
establish different processes for the reporting of critical incidents
for individuals enrolled in managed care, we assume for the purpose of
this analysis that the States would delegate provider reporting of
critical incidents and identification of critical incidents through
claims and other data sources to managed care entities and that the
managed care entities would be responsible for reporting the identified
critical incidents to the State.\249\ We further assume that the
information reported by managed care entities to the State would be in
an electronic form.
---------------------------------------------------------------------------
\249\ Addressing Critical Incidents in the MLTSS Environment:
Research Brief, available at https://aspe.hhs.gov/reports/addressing-critical-incidents-mltss-environment-research-brief-0.
---------------------------------------------------------------------------
We estimated that there are 161 managed long-term services and
supports plans providing services across 25 States.\250\ With regard to
the one-time requirements at Sec. 441.302(a)(6), we estimate it would
take: 20 hours at $108.68/hr for an administrative services manager to
draft policy for contracted providers; 20 hours at $96.66/hr for a
management analyst to update provider manuals; 40 hours at $65.02/hr
for a training and development specialist to develop and conduct
training for providers; 80 hours at $100.80/hr for a computer and
information analyst to build, design, and implement reports for using
claims and other data to identify unreported incidents; and 6 hours at
$204.82/hr for a chief executive to review and approve all operations
associated with this requirement. In aggregate, we estimate a one-time
burden of 26,726 hours (161 managed care entities x 166 hr) at a cost
of $2,576,084 (161 managed care entities x [(20 hr x $108.68/hr) + (20
hr x $96.66/hr) + (40 hr x $65.02/hr) + (80 hr x $100.80/hr) + (6 hr x
$204.82/hr)]).
---------------------------------------------------------------------------
\250\ ``A View from the States: Key Medicaid Policy Changes:
Results from a 50-State Medicaid Budget Survey for State Fiscal
Years 2019 and 2020,'' https://www.kff.org/report-section/a-view-from-the-states-key-medicaid-policy-changes-long-term-services-and-supports/.
Table 10--Summary of One-Time Burden for Managed Care Entities (MCEs) for the Incident Management System Requirements at Sec. 441.302(a)(6)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft policy for contracted providers. 161 161 Once..................... 20 3,220 108.68 349,950 n/a
Update provider manuals............... 161 161 Once..................... 20 3,220 96.66 311,245 n/a
Develop and conduct training for 161 161 Once..................... 40 6,440 65.02 418,729 n/a
providers.
Build, design, and implement reports 161 161 Once..................... 80 12,880 100.80 1,298,304 n/a
for using claims and other data to
identify unreported incidents.
[[Page 28047]]
Review and approve all operations 161 161 Once..................... 6 966 204.82 197,856 n/a
associated with this requirement.
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 805 Once..................... Varies 26,726 Varies 2,576,084 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
iii. Ongoing Incident Management System Requirements: Managed Care
Entities (Sec. 441.302(a)(6))
The on-going burden to managed care entities consists of the
collection and maintenance of information on critical incidents. As
noted earlier, we estimate that these requirements will result in the
identification of 283,446 more critical incidents annually than are
currently identified by States. We further estimate that 24 percent, or
68,027 (283,446 x 0.24), will be reported for individuals enrolled in
managed care delivery systems \251\ and that 10 percent, or 6,803
(68,027 x 0.10), will be made through provider reports and 90 percent,
or 61,224 (68,027 x 0.90), through claims identification and other
sources.\252\ We estimate that it would take 0.166 hr at $34.56/hr for
a data entry worker to record the information on each reported critical
incident reported by providers (Sec. 441.302(a)(6)(i)(B)(2)). In
aggregate, we estimate an ongoing burden of 1,129 hours (6,803 critical
incidents made through provider reports x 0.166 hr) at a cost of
$39,018 (1,129 hr x $34.56/hr). We also estimate that it would take: 20
hours at $100.80/hr for a computer and information analyst to update
and maintain reports for using claims and other data to identify
unreported incidents (Sec. 441.302(a)(6)(i)(B)(3)); 6 hours at
$110.82/hr for a general and operations manager to monitor the
operations associated with this requirement and report the information
to the State (Sec. 441.302(a)(6)(i)(E)); and 1 hour at $204.82/hr for
a chief executive to review and approve all operations associated with
this collection of information requirement (Sec. 441.302(a)(6)(i)(G)).
In aggregate, we estimate an ongoing burden of 5,476 hours (1,129 hr +
[161 managed care entities x 27 hr]) at a cost of $503,622 ($39,018 +
(161 managed care entities x [(20 hr x $100.80/hr) + (6 hr x $110.82/
hr) + (1 hr x $204.82/hr)]).
---------------------------------------------------------------------------
\251\ https://www.medicaid.gov/medicaid/long-term-services-supports/downloads/ltss-user-brief-2019.pdf.
\252\ Data is limited on the identification of critical
incidents through various data sources. We conservatively assume
that 25 percent of additional critical incidents identified as a
result of these requirements will be reported by providers even
though claims data will likely identify a substantially higher of
percentage of claims than will be reported by providers.
Table 11--Summary of Ongoing Burden for Managed Care Entities (MCEs) for the Incident Management System Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Record the information on each 161 6,803 Annually................. 0.166 1,129 34.56 39,029 n/a
reported critical incident reported
by providers (Sec.
441.302(a)(6)(i)(B)(2)).
Update and maintain reports for using 161 161 Annually................. 20 3,220 100.80 324,576 n/a
claims and other data to identify
unreported incidents (Sec.
441.302(a)(6)(i)(B)(3)).
Monitor the operations associated with 161 161 Annually................. 6 966 110.82 107,052 n/a
this requirement and report the
information to the State (Sec.
441.302(a)(6)(i)(E)).
Review and approve all operations 161 161 Annually................. 1 161 204.82 32,976 n/a
associated with this requirement
(Sec. 441.302(a)(6)(i)(G)).
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 7,286 Annually................. Varies 5,476 Varies 503,633 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
5. ICRs Regarding HCBS Payment Adequacy (Sec. Sec. 441.302(k) and
441.311(e); Cross-Referenced to Sec. Sec. 441.464(f), 441.570(f) and
441.745(a)(1)(iv), and Part 438)
This proposed rule would update Sec. 441.302, by adding new
paragraph (k)(2), which would require that at least 80 percent of
Medicaid payments for the following services be spent on compensation,
as defined at Sec. 441.302(k)(1)(i), to direct care workers for the
following services: homemaker services, home health aide services, and
personal care services.
Proposed Sec. 441.302(k)(1)(i) defines compensation to include
salary, wages, and other remuneration as defined by the Fair Labor
Standards Act and implementing regulations (29 U.S.C. 201 et seq., 29
CFR parts 531 and 778); benefits (such as health and dental benefits,
sick leave, and tuition reimbursement); and the employer share of
payroll taxes for direct care workers delivering services authorized
under section 1915(c) of the Act. Proposed Sec. 441.302(k)(1)(ii)
defines direct care workers to include workers who provide nursing
services, assist with activities of daily living (such as mobility,
personal hygiene, eating), or provide support with instrumental
activities of daily living (such as cooking, grocery shopping, managing
finances). Specifically, direct care workers include nurses (registered
nurses, licensed practical nurses, nurse practitioners, or clinical
nurse specialists) who provide nursing services to Medicaid-eligible
individuals receiving HCBS, licensed or certified nursing assistants,
direct support professionals, personal care attendants, home health
aides, and other individuals who are paid to directly provide services
to Medicaid beneficiaries receiving HCBS to address activities of daily
living or instrumental activities of daily living. Direct care
[[Page 28048]]
workers include individuals employed by a Medicaid provider, State
agency, or third party; contracted with a Medicaid provider, State
agency, or third party; or delivering services under a self-directed
service model.
To demonstrate compliance with the requirements proposed at Sec.
441.302(k), new reporting requirements are proposed at Sec.
441.311(e). Specifically, States would be required to report separately
on the percent of payments that are spent on the direct care workforce
for HCBS services. The services are found at Sec. 440.180(b)(2)
through (4), and include: homemaker services, home health aide
services, and personal care services. Separate reporting would be
required on payment for services that are self-directed.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument will be made
available to the public for their review under the standard non-rule
PRA process which includes the publication of 60- and 30-day Federal
Register notices. In the meantime, we are setting out our preliminary
burden figures (see below) as a means of scoring the impact of this
rule's proposed changes. The availability of the survey instrument and
more definitive burden estimates will be announced in both Federal
Register notices. The CMS ID number for that collection of information
request is CMS-10854 (OMB control number 0938-TBD). Since this would be
a new collection of information request, the OMB control number has yet
to be determined (TBD) but will be issued by OMB upon their approval of
the new collection of information request.
a. States
The burden associated with the proposed requirements would affect
the 48 States (including Washington, DC) that deliver HCBS under
sections 1915(c), (i), (j), or (k) authorities.253 254 We
estimate both a one-time and ongoing burden to implement these
requirements at the State level. Specifically, under proposed
Sec. Sec. 441.302(k) and 441.311(e), States would have to: (1) draft
new policy (one-time); (2) publish the provider requirements through
State notice and publication processes (one-time); (3) update provider
manuals and other policy guidance for each of the services subject to
the requirement (one-time); (4) inform providers of services through
State notification processes, both initially and annually (one-time and
ongoing); (5) collect the information from providers for each service
required (ongoing); (6) aggregate the data broken down by each service
as well as self-directed services (ongoing); (7) derive an overall
percentage for each service including self-directed services (ongoing);
and (8) report to us on an annual basis (ongoing).
---------------------------------------------------------------------------
\253\ Arizona, Rhode Island, and Vermont do not have HCBS
programs under any of these authorities.
\254\ For purposes of this burden analysis, we are not taking
into consideration temporary wage increases or bonus payments that
have been or are being made.
---------------------------------------------------------------------------
i. One Time HCBS Payment Adequacy Requirements: State Burden
With regard to the one-time requirements, we estimate it would
take: 80 hours at $108.68/hr for an administrative services manager to:
draft policy content, prepare notices and draft rules for publication,
conduct public hearings, and draft contract modifications for managed
care plans; 30 hours at $96.66/hr for a management analyst to update
provider manuals for each of the affected services, and draft provider
agreement amendments; 25 hours at $92.92/hr for a computer programmer
to build, design, and operationalize internal systems for collection,
aggregation, stratification by service, reporting, and creating
remittance advice; 60 hours at $65.02/hr for a training and development
specialist to develop and conduct training for providers; 6 hours at
$110.82/hr for a general and operations manager to: review, approve
managed care contract modifications, policy and rules for publication,
and training materials; and 3 hours at $204.82/hr for a chief executive
to review and approve all operations associated with this requirement.
In aggregate, we estimate a one-time burden of 9,792 hours (204 hr x 48
States) at a cost of $916,693 (48 States x [(80 hr x $108.68/hr) + (30
hr x $96.66/hr) + (25 hr x $92.92/hr) + (60 hr x $65.02/hr) + (6 hr x
$110.82/hr) + (3 hr x $204.82/hr)]). Taking into account the Federal
contribution to Medicaid administration, the estimated State share of
this cost would be $458,347 ($916,693 x 0.50).
Table 12--Summary of One-Time Burden for States for the HCBS Payment Adequacy Requirements at Sec. Sec. 441.302(k) and 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft policy content, prepare notices 48 48 Once..................... 80 3,840 108.68 417,331 208,666
and draft rules for publication,
conduct public hearings; and draft
contract modifications for managed
care plans.
Update provider manuals for each of 48 48 Once..................... 30 1,440 96.66 139,190 69,595
the affected services, draft provider
agreement amendment.
Build, design, and operationalize 48 48 Once..................... 25 1,200 92.92 111,504 55,752
internal systems for collection,
aggregation, stratification by
service, reporting, and creating
remittance advice.
Develop and conduct training for 48 48 Once..................... 60 2,880 65.02 187,258 93,629
providers.
Review, approve managed care contract 48 48 Once..................... 6 288 110.82 31,916 15,958.08
modifications, policy and rules for
publication, and training materials.
Review and approve all operations 48 48 Once..................... 3 144 204.82 29,494 14,747
associated with this requirement.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 288 Once..................... Varies 9,792 Varies 916,693 458,347
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 28049]]
ii. Ongoing HCBS Payment Adequacy Requirements: State Burden
With regard to the on-going requirements, we estimate it would take
6 hours at $92.92/hr for a computer programmer to: (1) collect the
information from all providers for each service required; (2) aggregate
and stratify by each service as well as self-directed services; (3)
derive an overall percentage for each service including self-directed
services; and (4) develop report to CMS on an annual basis. We also
estimate it would take 2 hours at $110.82/hr by a general and
operations manager to review, verify, and approve reporting to CMS and
1 hour at $204.82/hr for a chief executive to review and approve all
operations associated with this requirement. In aggregate, we estimate
an ongoing burden of 432 hours (9 hr x 48 States) at a cost of $47,231
(48 States x [(6 hr x $92.92/hr) + (2 hr x $110.82/hr) + (1 hr x
$204.82/hr)]). Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be $23,616
($47,231 x 0.50) per year.
Table 13--Summary of Ongoing Burden for States for the HCBS Payment Adequacy Requirements at Sec. Sec. 441.302(k) and 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Collect information from providers; 48 48 Annually................. 6 288 92.92 26,761 13,380
aggregate and stratify data as
required; derive an overall
percentage for each service; and
develop report annually.
Review, verify and approve reporting 48 48 Annually................. 2 96 110.82 10,639 5,319
to CMS.
Review and approve all operations 48 48 Annually................. 1 48 204.82 9,831 4,916
associated with this requirement.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 144 Annually................. Varies 432 Varies 47,231 23,616
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Service Providers and Managed Care Contractors
The burden associated with this proposed rule will affect both
service providers that provide the services listed at Sec.
440.180(b)(2) through (4) across HCBS programs as well as managed care
entities that contract with the States to provide managed long-term
services and supports. We estimate both a one-time and ongoing burden
to implement the reporting requirements Sec. 441.311(e) for both
service providers and managed care contractors.
To estimate the number of service providers that will be impacted
by this proposed rule, we used unpublished data from the Provider
Relief Fund to estimate that there are 14,444 providers nationally
across all payers delivering homemaker, home health aide, and/or
personal care services. We then prorate the number to estimate the
number of providers in the 48 States that are subject to this
requirement (14,444 providers nationally x 48 States subject to the
proposed requirement/51 States = 13,594 providers). We used data from
the Centers for Disease Control and Prevention \255\ to estimate the
percentage of these HCBS providers that participate in Medicaid and,
due to uncertainty in the data and differences in provider definitions,
estimate both a lower and upper range of providers affected. At a low
end of 78 percent Medicaid participation, we estimate that there are
10,603 providers impacted (13,594 x 0.78), while at a high end of 85
percent participation, we estimate that there are 11,555 providers
impacted (13,594 x 0.85). To be conservative and not underestimate our
projected burden analysis, we are using the high end of our estimates
to score the PRA-related impact of the proposed requirements.
---------------------------------------------------------------------------
\255\ https://www.cdc.gov/nchs/data/series/sr_03/sr03-047.pdf.
---------------------------------------------------------------------------
i. One Time HCBS Payment Adequacy Requirements: Service Providers
(Sec. 441.311(e))
With regard to the one-time requirements, we estimate it would
take: 35 hours at $70.98/hr for a compensation, benefits and job
analysis specialist to calculate compensation, as defined by Sec.
441.302(k)(1)(i) for each direct care worker defined at Sec.
441.302(k)(1)(ii); 40 hours at $92.92/hr for a computer programmer to
build, design and operationalize an internal system to calculate each
direct care worker's compensation as a percentage of total revenues
received, aggregate the sum of direct care worker compensation as an
overall percentage, and separate self-directed services to report to
the State; and 8 hours at $110.82/hr for a general and operations
manager to review and approve reporting to the State. In aggregate, we
estimate a one-time burden of 959,065 hours (11,555 providers x 83 hr)
at a cost of $81,897,911 (11,555 providers x [(35 hr x $70.98/hr) + (40
hr x $92.92/hr) + (8 hr x $110.82/hr)]).
Table 14--Summary of One-Time Burden for Service Providers for the HCBS Payment Adequacy Requirements at Sec. 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total cost share
respondents responses (hr) (hr) hr) ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Calculate compensation for each 11,555 11,555 Once.................... 35 404,425 70.98 28,706,087 n/a
direct care worker.
Build, design and operationalize an 11,555 11,555 Once.................... 40 462,200 92.92 42,947,624 n/a
internal system for reporting to the
State.
Review and approve reporting to the 11,555 11,555 Once.................... 8 92,440 110.82 10,244,200 n/a
State.
------------------------------------------------------------------------------------------------------------------
Total............................ 11,555 34,665 Once.................... Varies 959,065 Varies 81,897,911 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 28050]]
ii. Ongoing HCBS Payment Adequacy Requirements: Service Providers
(Sec. 441.311(e))
With regard to the on-going requirements, we estimate it would take
8 hours at $70.98/hr for a compensation, benefits, and job analysis
specialist to account for new hires and/or contracted employees; 8
hours at $92.92/hr for a computer programmer to calculate compensation,
aggregate data, and report to the State as required; and 5 hours at
$110.82/hr for a general and operations manager to review and approve
reporting to the State. In aggregate, we estimate an on-going burden of
242,655 hours (11,555 providers x 21 hr) at a cost of $21,553,542
(11,555 providers x [(8 hr x $70.98/hr) + (8 hr x $92.92/hr) + (5 hr x
$110.82/hr)]).
Table 15--Summary of Ongoing Burden for Service Providers for the HCBS Payment Adequacy Requirements at Sec. 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total cost share
respondents responses (hr) (hr) hr) ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Account for new hires and/or 11,555 11,555 Once.................. 8 92,440 70.98 6,561,391 n/a
contracted employees.
Calculate compensation, aggregate 11,555 11,555 Once.................. 8 92,440 92.92 8,589,525 n/a
data, and report to the State.
Review and approve reporting to the 11,555 11,555 Once.................. 5 57,775 110.82 6,402,626 n/a
State.
-------------------------------------------------------------------------------------------------------------------
Total........................... 11,555 34,665 Once.................. Varies 242,655 Varies 21,553,542 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
iii. One Time HCBS Payment Adequacy Requirements: Managed Care Entities
(Sec. 441.311(e))
As noted earlier, the burden associated with this proposed rule
will affect managed care entities (see section d, below) that contract
with the States to provide managed long-term services and supports. We
estimate that there are 161 managed long-term services and supports
plans providing services across 25 States.\256\ We estimate both a one-
time and ongoing burden for managed care entities to implement these
requirements. Specifically, managed care entities would have to: (1)
draft new policy (one-time); (2) update provider manuals for each of
the services subject to the requirement (one-time); (3) inform
providers of requirements (one-time and ongoing); (4) collect the
information from providers for each service required (ongoing); (5)
aggregate the data as required by the States (ongoing); and (6) report
to the State on an annual basis (ongoing).
---------------------------------------------------------------------------
\256\ https://www.kff.org/report-section/a-view-from-the-states-key-medicaid-policy-changes-long-term-services-and-supports/;
Profiles & Program Features [bond] Medicaid.
---------------------------------------------------------------------------
With regard to the one-time requirements, we estimate it would take
40 hours at $108.68/hr for an administrative services manager to draft
policy for contracted providers; 25 hours at $92.92/hr for a computer
programmer to build, design, and operationalize internal systems for
data collection, aggregation, stratification by service, and reporting;
30 hours at $65.02/hr for a training and development specialist to
develop and conduct training for providers; and 3 hours at $204.82/hr
for a chief executive to review and approve reporting to the State. In
aggregate, we estimate a one-time burden of 15,778 hours (161 MCEs x 98
hr) at a cost of $1,486,877 (161 MCEs x [(40 hr x $108.68/hr) + (25 hr
x $92.92/hr) + (30 hr x $65.02/hr) + (3 hr x $204.82/hr)]).
Table 16--Summary of One-Time Burden for Managed Care Entities (MCEs) for the HCBS Payment Adequacy Requirements at Sec. 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft policy for contracted providers. 161 161 Once..................... 40 6,440 108.68 699,899 n/a
Build, design, and operationalize 161 161 Once..................... 25 4,025 92.92 374,003 n/a
internal systems for data collection,
aggregation, stratification by
service, and reporting.
Develop and conduct training for 161 161 Once..................... 30 4,830 65.02 314,047 n/a
providers.
Review and approve reporting to the 161 161 Once..................... 3 483 204.82 98,928 n/a
State.
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 644 Once..................... Varies 15,778 Varies 1,486,877 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
iv. Ongoing HCBS Payment Adequacy Requirements: Managed Care Entities
(Sec. 441.311(e))
With regard to the ongoing requirements, we estimate it would take:
6 hours at $92.92/hr for a computer programmer to: (1) collect the
information from all providers for each service required, (2) aggregate
and stratify data as required, and (3) develop report to the State on
an annual basis; and 2 hours at $204.82/hr for a chief executive to
review and approve the reporting to the State. In aggregate, we
estimate an ongoing burden of 1,288 hours (161 MCEs x 8 hr) at a cost
of $155,713 (161 MCEs x [(6 hr x $92.92/hr) + (2 hr x $204.82/hr)]).
[[Page 28051]]
Table 17--Summary of Ongoing Burden for Managed Care Entities (MCEs) for the HCBS Payment Adequacy Requirements at Sec. 441.311(e)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total
Requirement Number of Total Frequency response time Wage ($/ Total cost State share
respondents responses (hr) (hr) hr) ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Collect information from 161 161 Annually............ 6 966 92.92 89,760 n/a
providers; aggregate and
stratify data as required; and
develop report annually.
Review and approve the report.... 161 161 Annually............ 2 322 204.82 65,952 n/a
----------------------------------------------------------------------------------------------------------------------
Total........................ 161 322 Annually............ Varies 1,288 Varies 155,713 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
6. ICRs Regarding Supporting Documentation for HCBS Access (Sec. Sec.
441.303(f)(6) and 441.311(d)(1))
Section 1915(c) of the Act authorizes States to set enrollment
limits or caps on the number of individuals served in a waiver, and
many States maintain waiting lists of individuals interested in
receiving waiver services once a spot becomes available. States vary in
the way they maintain waiting lists for section 1915(c) waivers, and if
a waiting list is maintained, how individuals may join the waiting
list. Some States permit individuals to join a waiting list as an
expression of interest in receiving waiver services, while other States
require individuals to first be determined eligible for waiver services
to join the waiting list. States have not been required to submit any
information on the existence or composition of waiting lists, which has
led to gaps in information on the accessibility of HCBS within and
across States. Further, feedback obtained during various interested
parties' engagement activities conducted with States and other
interested parties over the past several years about reporting
requirements for HCBS, as well as feedback received through the RFI
\257\ discussed earlier, indicate that there is a need to improve
public transparency and processes related to States' HCBS waiting
lists.
---------------------------------------------------------------------------
\257\ CMS Request for Information: Access to Coverage and Care
in Medicaid & CHIP. February 2022. For a full list of question from
the RFI, see https://www.medicaid.gov/medicaid/access-care/downloads/access-rfi-2022-questions.pdf.
---------------------------------------------------------------------------
We propose to amend Sec. 441.303(f)(6) by adding language to the
end of the regulatory text: ``If the State has a limit on the size of
the waiver program and maintains a list of individuals who are waiting
to enroll in the waiver program, the State must meet the reporting
requirements at Sec. 441.311(d)(1).''
For States that limit or cap enrollment in a section 1915(c) waiver
and maintain a waiting list, States would be required to provide a
description annually on how they maintain the list of individuals who
are waiting to enroll in a section 1915(c) waiver program. The
description must include, but not be limited to, information on whether
the State screens individuals on the waiting list for eligibility for
the waiver program, whether the State periodically re-screen
individuals on the waiver list for eligibility, and the frequency of
re-screening, if applicable. In addition, States would be required to
report of the number of people on the waiting list if applicable, as
well as the average amount of time that individuals newly enrolled in
the waiver program in the past 12 months were on the waiting list, if
applicable.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
a. One Time Waiting List Reporting Requirements: States (Sec.
441.311(d)(1))
The one-time State burden associated with the waiting list
reporting requirements proposed in Sec. 441.311(d)(1) will affect the
39 State Medicaid programs with waiting lists for section 1915(c)
waivers.\258\ We estimate both a one-time and ongoing burden to
implement these requirements at the State level. Specifically, States
will have to query their databases or instruct their contractors to do
so to collect information on the number of people on existing waiting
lists and how long they wait; and write or update their existing
waiting list policies and the information collected. In some States,
HCBS waivers are administered by more than one operating agency, in
these cases each will have to report this data up to the Medicaid
agency for submission to us.
---------------------------------------------------------------------------
\258\ https://www.kff.org/report-section/state-policy-choices-about-medicaid-home-and-community-based-services-amid-the-pandemic-issue-brief/.
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With regard to the one-time requirements, we estimate it would
take: 16 hours at $108.68/hr for an administrative services manager to
write or update State policy, direct information collection, compile
information, and produce a report; 20 hours at $92.92/hr for a computer
programmer or contractor to query internal systems for reporting
requirements; 3 hours at $110.82/hr for a general and operations
manager to review and approve report; and 2 hours at $204.82/hr for a
chief executive to review and approve all reports associated with this
requirement. In aggregate, we estimate a burden of 1,599 hours (39
States x 41 hr) at a cost of $169,236 (39 States x [(16 hr x $108.68/
hr) + (20 hr x $92.92/hr) + (3 hr x $110.82/hr) + (2 hr x $204.82/
hr)]). Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be $84,618
($169,236 x 0.50).
Assuming no changes to the State waiting list policies, each year
States would only need to update the report to reflect the number of
people on the list of individuals who are waiting to enroll in the
waiver program and average amount of time that individuals newly
enrolled in the waiver program in the past 12 months were on the list.
[[Page 28052]]
Table 18--Summary of One-Time Burden for States for the Waiting List Reporting Requirements at Sec. 441.311(d)(1)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Write or update State policy, direct 39 39 Once..................... 16 624 108.68 67,816 33,908
information collection, compile
information, and produce a report.
Query internal systems for reporting 39 39 Once..................... 20 780 92.92 72,478 36,239
requirements.
Review and approve report at 39 39 Once..................... 3 117 110.82 12,966 6,483
management level.
Review and approve all reports 39 39 Once..................... 2 78 204.82 15,976 7,988
associated with this requirement at
the executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 39 156 Once..................... Varies 1,599 Varies 169,236 84,618
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Ongoing Waiting List Reporting Requirements: States (Sec.
441.311(d)(1))
With regard to the on-going burden for the section 1915(c) waiver
waiting list reporting requirements at Sec. 441.311(d)(1), we estimate
it would take: 4 hours at $108.68/hr for an administrative services
managers across relevant operating agencies to direct information
collection, compile information, and produce a report; 6 hours at
$92.92/hr for a computer programmer or contractor to query internal
systems for reporting requirements; 3 hours at $110.82/hr for a general
and operations manager to review and approve report; and 2 hours at
$204.82/hr for a chief executive to review and approve all reports
associated with this requirement. In aggregate, we estimate a burden of
585 hours (39 States x 15 hr) at a cost of $67,639 (39 States x [(4 hr
x $108.68/hr) + (6 hr x $92.92/hr) + (3 hr x $110.82/hr) + (2 hr x
$204.82/hr)]. Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be $33,820
($67,639 x 0.50) per year.
Table 19--Summary of Ongoing Burden for States for the Waiting List Reporting Requirements at Sec. 441.311(d)(1)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct information collection, compile 39 39 Annually................. 4 156 108.68 16,954 8,477
information, and produce a report.
Query internal systems for reporting 39 39 Annually................. 6 234 92.92 21,743 10,872
requirements.
Review and approve report at the 39 39 Annually................. 3 117 110.82 12,966 6,483
management level.
Review and approve all reports 39 39 Annually................. 2 78 204.82 15,976 7,988
associated with this requirement at
the executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 39 156 Annually................. Varies 585 Varies 67,639 33,820
--------------------------------------------------------------------------------------------------------------------------------------------------------
7. ICRs Regarding Additional HCBS Access Reporting (Sec.
441.311(d)(2)(i))
Additional HCBS access reporting is proposed at Sec.
441.311(d)(2)(i). States would be required to report annually on the
average amount of time from when homemaker services, home health aide
services, or personal care services, listed in Sec. 440.180(b)(2)
through (4), are initially approved to when services began for
individuals newly approved to begin receiving services within the past
12 months. For this specific metric, States will be allowed to report
on a statistically valid random sample of individuals newly approved to
begin receiving these services within the past 12 months.
Proposed Sec. 441.311(d)(2)(ii) would require States to report
annually on the percent of authorized hours for homemaker services,
home health aide services, or personal care, as listed in Sec.
440.180(b)(2) through (4), that are provided within the past 12 months.
States will have the option to report on a statistically valid random
sample of individuals authorized to receive these services within the
past 12 months, rather than all individuals authorized to receive these
services within the past 12 months.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
The burden associated with the proposed additional HCBS access
reporting requirements at Sec. 441.311(d)(2) would affect the 48
States (including Washington DC) that deliver HCBS under sections
1915(c), (i), (j), or (k) authorities.\259\ Specifically, States will
have to query their databases or instruct their contractors to do so to
collect information on the average amount of time from which homemaker
services, home health aide services, or personal care services, as
listed in Sec. 440.180(b)(2) through (4), are initially approved to
when services began, for individuals newly approved to begin receiving
services within the past 12 months, and the percent of authorized hours
for these services that are provided within the past 12 months. We
expect many States will need to analyze report this metric for a
statistically valid random sample of beneficiaries. They will then need
to produce a report for
[[Page 28053]]
us within such information. For States with managed long-term services
and supports, they would need to direct managed care entities to report
this information up to them.
---------------------------------------------------------------------------
\259\ Arizona, Rhode Island, and Vermont do not have HCBS
programs under any of these authorities.
---------------------------------------------------------------------------
We estimate one-time and ongoing burden to implement the
requirements at Sec. 441.311(d)(2) at the State level.
a. One-Time HCBS Access Reporting Requirements: States (Sec.
441.311(d)(2))
With regard to the one-time burden related to the HCBS access
reporting requirements, we estimate it would take: 20 hours at $108.68/
hr for an administrative services manager across relevant operating
agencies to direct information collection, compile information, and
produce a report; 60 hours at $92.92/hr for a computer programmer or
contractor to analyze service authorization and claims data; 40 hours
at $95.62/hr for a statistician to conduct data sampling; 3 hours at
$110.82/hr for a general and operations manager to review and approve
report; and 2 hours at $204.82/hr for a chief executive to review and
approve all reports associated with this requirement. In aggregate, we
estimate a one-time burden of 6,000 hours (48 States x 125 hr) at a
cost of $591,154 (48 States x [(20 hr x $108.68/hr) + (60 hr x $92.92/
hr) + (40 hr x $95.62/hr) + (3 hr x $110.82/hr) + (2 hr x $204.82/
hr)]). Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be
$295,577 ($591,154 x 0.50) per year.
Table 20--Summary of One-Time Burden for States for the HCBS Access Reporting Requirements at Sec. 441.311(d)(2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct information collection, compile 48 48 Once..................... 20 960 108.68 104,333 52,166
information, and produce a report.
Analyze service authorization and 48 48 Once..................... 60 2,880 92.92 267,610 133,805
claims data.
Conduct data sampling................. 48 48 Once..................... 40 1,920 95.62 183,590 91,795
Review and approve report at the 48 48 Once..................... 3 144 110.82 15,958 7,979
management level.
Review and approve all reports 48 48 Once..................... 2 98 204.82 19,663 9,831
associated with this requirement at
the executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 240 Once..................... Varies 6,000 Varies 591,154 295,577
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Ongoing HCBS Access Reporting Requirements: States (Sec.
441.311(d)(2))
With regard to the on-going burden related to the HCBS access
reporting requirements for States, we estimate it would take: 10 hours
at $108.68/hr for an administrative services manager to direct
information collection, compile information, and produce a report; 20
hours at $92.92/hr for a computer programmer or contractor to analyze
service authorization and claims data; 10 hours at $95.62/hr for a
statistician to conduct data sampling; 3 hours at $110.82/hr for a
general and operations manager to review and approve report; and 2
hours at $204.82/hr for a chief executive to review and approve all
reports associated with this requirement. In aggregate, we estimate a
burden of 2,160 hours (48 States x 45 hr) at a cost of $222,888 (48
States x [(10 hr x $108.68/hr) + (20 hr x $92.92/hr) + (10 hr x $95.62/
hr) + (3 hr x $110.82/hr) + (2 hr x $204.82/hr)]). Taking into account
the Federal contribution to Medicaid administration, the estimated
State share of this cost would be $111,444 ($222,888 x 0.50) per year.
Table 21--Summary of Ongoing Burden for States for the HCBS Access Reporting Requirements at Sec. 441.311(d)(2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct information collection, compile 48 48 Annually................. 10 480 108.68 52,166 26,083
information, and produce a report.
Analyze service authorization and 48 48 Annually................. 20 960 92.92 89,203 44,601
claims data.
Conduct data sampling................. 48 48 Annually................. 10 480 95.62 45,898 22,949
Review and approve report at the 48 48 Annually................. 3 144 110.82 15,958 7,979
management level.
Review and approve all reports 48 48 Annually................. 2 96 204.82 19,663 9,831
associated with this requirement at
the executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 240 Annually................. Varies 2,160 Varies 222,888 111,444
--------------------------------------------------------------------------------------------------------------------------------------------------------
c. One-Time HCBS Access Reporting Requirements: Managed Care Entities
(Sec. 441.311(d)(2))
With regard to the one-time proposed HCBS access reporting
requirements at Sec. 441.311(d)(2) for managed care entities, we
estimate it would take: 10 hours at $108.68/hr for an administrative
services manager to direct information collection, compile information,
and produce a report to the State; 35 hours at $92.92/hr for a computer
programmer to analyze service authorization and claims data; 10 hours
at $95.62/hr for a statistician to conduct data sampling; and 2 hours
at $204.82/hr for a chief executive review and approval. In aggregate,
we estimate a one-time burden of 9,177 hours (161 MCEs x 57 hr) at a
cost of $918,479 (161 MCEs x [(10 hr x $108.68/hr) + (35 hr x $92.92/
hr) + (10 hr x $95.62/hr) + (2 hr x $204.82/hr)]).
[[Page 28054]]
Table 22--Summary of One-Time Burden for Managed Care Entities for the HCBS Access Reporting Requirements at Sec. 441.311(d)(2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct information collection, compile 161 161 Once..................... 10 1,610 108.68 174,975 n/a
information, and produce a report to
the State.
Analyze service authorization and 161 161 Once..................... 35 5,635 92.92 523,604 n/a
claims data.
Conduct data sampling................. 161 161 Once..................... 10 1,610 95.62 153,948 n/a
Review and approve report............. 161 161 Once..................... 2 322 204.82 65,952 n/a
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 644 Once..................... Varies 9,177 Varies 918,479 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
d. Ongoing HCBS Access Reporting Requirements: Managed Care Entities
(Sec. 441.311(d)(2))
With regard to the ongoing requirements associated with the annual
collection, aggregation, and reporting the HCBS access measures at
Sec. 441.311(d)(2), we estimate it would require: 4 hours at $108.68/
hr for an administrative services manager to direct information
collection, compile information, and produce a report to the State; 20
hours at $92.92/hr for a computer programmer to analyze service
authorization and claims data; 8 hours at $95.62/hr for a statistician
to conduct data sampling; and 2 hours at $204.82/hr for a chief
executive to review and approve. In aggregate, we estimate a burden of
5,474 hours (161 MCEs x 34 hr) at a cost of $558,303 (161 MCEs x [(4 hr
x $108.68/hr) + (20 hr x $92.92/hr) + (8 hr x $95.62/hr) + (2 hr x
$204.82/hr)]).
Table 23--Summary of Ongoing Burden for Managed Care Entities (MCEs) for Additional HCBS Access Reporting Requirements at Sec. 441.311(d)(2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response Trtime Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct information collection, compile 161 161 Annually................. 4 644 108.68 69,990 n/a
information, and produce a report to
the State.
Analyze service authorization and 161 161 Annually................. 20 3,220 92.92 299,202 n/a
claims data.
Conduct data sampling................. 161 161 Annually................. 8 1,288 95.62 123,159 n/a
Review and approve report............. 161 161 Annually................. 2 322 204.82 65,952 n/a
-----------------------------------------------------------------------------------------------------------------
Total............................. 161 644 Annually................. Varies 5,474 Varies 558,303 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
8. ICRs Regarding Compliance Reporting (Sec. 441.311(b))
a. Ongoing Incident Management System Assessment Requirements: States
(Sec. 441.311(b)(1))
Through proposed updates to Sec. 441.311(b)(1), as described in
proposed Sec. 441.302(a)(6), this proposed rulemaking aims to
standardize CMS expectations and State reporting requirements to ensure
that States operate and maintain an incident management system that
identifies, reports, triages, investigates, resolves, tracks, and
trends critical incidents. The proposed updates were informed by the
responses to the HCBS Incident Management Survey (CMS-10692; OMB 0938-
1362) recently released to States.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10692 (OMB control number 0938-1362). We
estimate that the proposed reporting requirement at Sec. 441.311(b)(1)
would apply to the 48 States (including Washington, DC) that deliver
HCBS under sections 1915(c), (i), (j), or (k) authorities. Some States
employ the same incident management system across their waivers, while
others employ an incident management system specific to each waiver and
will require multiple assessments to meet the proposed requirements at
Sec. 441.311(b)(1). Based on the responses to the previously
referenced survey, we are estimating that on average States will
conduct assessments on two incident management systems, totaling
approximately 96 unique required assessments (48 State Medicaid
programs x 2 incident management system assessments per State). Because
the requirements proposed by Sec. 441.311(b)(1) would be required
every 24 months, we estimate 48 assessments on an annual basis (96
unique assessments every 2 years). With regard to the ongoing
requirements, we estimate that it would take 1.5 hours at $73.84/hr for
a social/community service manager to gather information and complete
the required assessment; and 0.5 hours at $110.82/hr for a general and
operations manager to review and approve the assessment. In aggregate,
we estimate an ongoing annual burden of 96 hours (48 States x 2 hr) at
a cost of $7,976 (48 States x [(1.5 hr x $73.84/hr) + (0.5 hr x
$110.82/hr)]). Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be $3,988
($7,976 x 0.50) per year.
[[Page 28055]]
Table 24--Summary of the Ongoing Burden for States for the Proposed Incident Management System Assessment Requirements at Sec. 441.311(b)(1)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Gather information and complete the 48 48 Annually................. 1.5 72 73.84 5,316 2,658
required assessment.
Review and appprove the assessment.... 48 48 Annually................. 0.5 24 110.82 2,660 1,330
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 96 Annually................. Varies 96 Varies 7,976 3,988
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Reporting on Critical Incidents (Sec. 441.311(b)(2)), Person-
Centered Planning (Sec. 441.311(b)(3)), and Type, Amount, and Cost of
Services (Sec. 441.311(b)(4))
This proposed rulemaking codifies existing compliance reporting
requirements on Critical Incidents, Person-Centered Planning, and Type,
Amount, and Cost of Services. This includes codifying minimum
performance standards at Sec. 441.311(b)(2) and (3) and making updates
to critical incident and person-centered planning requirements
previously described in 2014 guidance,\260\ and moving the existing
requirement at Sec. 441.302(h)(1) to report on type, amount, and cost
of services to Sec. 441.311(b)(4) as part of the new consolidated
compliance reporting section at Sec. 441.311.
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\260\ https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_71.pdf.
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This proposed rule would remove our currently approved burden and
replace it with the burden associated with the proposed amendments to
Sec. 441.311(b)(2) through (4). In aggregate, the change would remove
11,132 hours (253 waivers x 44 hr) and $860,281 (11,132 hr x $77.28/hr
for a business operations specialist). Taking into account the Federal
contribution to Medicaid administration, the estimated State share of
this cost reduction would be minus $430,140 (-$860,281 x 0.50).
Table 25--Summary of the Removal of Approved Ongoing Burden for Form 372(S) as a Result of the Proposed Requirements at Sec. 441.311(b)(2) Through
(b)(4)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Remove currently approved burden under 48 253 Annually................. (44) (11,132) 77.28 (860,281) (430,140)
control number 0938-0272 (CMS-372(S)).
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 253 Annually................. (44) (11,132) 77.28 (860,281) (430,140)
--------------------------------------------------------------------------------------------------------------------------------------------------------
We expect to revise the Form CMS-372(S) and the form's instructions
based on the proposed reporting requirements. The following proposed
changes will be submitted to OMB for their approval after this proposed
rule is finalized and our survey instrument has been developed. The
survey instrument and burden will be made available to the public for
their review under the standard non-rule PRA process which includes the
publication of 60- and 30-day Federal Register notices. In the
meantime, we are setting out our preliminary burden figures (see below)
as a means of scoring the impact of this rule's proposed changes. The
availability of the survey instrument and more definitive burden
estimates will be announced in both Federal Register notices. The CMS
ID number for that collection of information request is CMS 0938-0272
(CMS-372(S)). The proposed consolidated reporting requirements at Sec.
441.311(b)(2) through (4) also assume that 48 States (including
Washington, DC) are required to submit the Form CMS-372(S) Report on an
annual basis. However, a separate form would no longer be required for
each of the 253 approved waivers currently in operation. We estimate a
burden of 50 hours for a business operations specialist to draft each
Form CMS-372(S) Report submission. The per response increase reflects
the proposed increase to the minimum State quality performance level
for person-centered planning (at proposed Sec. 441.301(c)(3)(ii)) and
critical incident reporting (at proposed Sec. 441.302(a)(6)(ii)) from
the 86 percent threshold established by the 2014 guidance to 90 percent
in this proposed rule. This slight increase to the minimum performance
level will help ensure that States are sufficiently meeting all section
1915(c) waiver requirements but may also increase the evidence that
some States may need to submit to document that appropriate remediation
is being undertaken to resolve any compliance deficiencies. As a
result, we now estimate a total of 50 hours for each Form CMS-372(S)
Report submission, comprised of 30 hours of recordkeeping, collection
and maintenance of data, and 20 hours of record assembly, programming,
and completing the Form CMS-372(S) Report in the required format. We
also estimate 3 hours at $110.82/hr for a general and operations
manager to review and approve the report to CMS; and 2 hours at
$204.82/hr for a chief executive to review and approve all reports
associated with this requirement.
[[Page 28056]]
Table 26--Summary of the New Burden for Form 372(S) Annual Report on HCBS Waivers, Inclusive of Updates to Proposed Sec. 441.311(b)(2) Through (4)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Draft Form CMS 372(S) Report 48 48 Annually................. 50 2,400 77.28 185,472 92,736
submission.
Review and approve the report at the 48 48 Annually................. 3 144 110.82 15,958 7,979
management level.
Review and approve all reports 48 48 Annually................. 2 96 204.82 19,663 9,831
associated with this requirement at
the executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 144 Annually................. Varies 2,640 Varies 221,093 110,546
--------------------------------------------------------------------------------------------------------------------------------------------------------
The net change resulting from reporting requirements on critical
incidents, person-centered service planning, and type, amount, and cost
of services, proposed by Sec. 441.311(b)(2) through (4) is a burden
decrease of 8,492 hours and $319,594 (State share).
9. ICRs Regarding Reporting on the Home and Community-Based Services
(HCBS) Quality Measure Set (Sec. 441.311(c))
a. States
At Sec. 441.311(c), we propose to require that States report every
other year on the HCBS Quality Measure Set, which is described in
section II.B.8. of the preamble. The proposed reporting requirement
would affect the 48 States (including Washington, DC) that deliver HCBS
under section 1915(c), 1915(i), 1915(j), and 1915(k) authorities. We
estimate both a one-time and ongoing burden to implement these
requirements at the State level.
As proposed at Sec. 441.311(c), the data collection would include
reporting every other year on all measures in the HCBS Quality Measure
Set that are identified by the Secretary.\261\ For certain measures
which are based on data already collected by us, the State can elect to
have the Secretary report on their behalf.
---------------------------------------------------------------------------
\261\ Available at https://www.medicaid.gov/federal-policy-guidance/downloads/smd22003.pdf.
---------------------------------------------------------------------------
Under proposed Sec. 441.312(c)(1)(iii), States would also be
required to establish performance targets, subject to our review and
approval, for each of the measures in the HCBS Quality Measure Set that
are identified as mandatory for States to report or are identified as
measures for which we will report on behalf of States, as well as to
describe the quality improvement strategies that they will pursue to
achieve the performance targets for those measures.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
i. One Time HCBS Quality Measure Set Requirements: States (Sec.
441.311(c))
This one-time burden analysis assumes that States must newly adopt
one of the ``experience of care'' surveys cited in the HCBS Quality
Measure Set: The Consumer Assessment of Healthcare Providers and
Systems Home and Community-Based (HCBS CAHPS[supreg]) Survey, National
Core Indicators[supreg]-Intellectual and Developmental Disabilities
(NCI[supreg]-IDD), National Core Indicators-Aging and Disability (NCI-
AD)TM, or Personal Outcome Measures (POM)[supreg] to fully
meet the HCBS Quality Measures Set mandatory requirements. Currently
most States use at least one of these surveys; however, States may need
to use multiple ``experience of care'' surveys, depending on the
populations served by the States' HCBS program and the particular
survey instruments that States select to use, to ensure that all major
population groups are assessed using the measures in the HCBS Quality
Measure Set.
The estimate of one-time burden related to the effort associated
with the proposed requirements is for the first year of reporting. It
assumes that the Secretary will initially require 25 of the 97 measures
currently included in the HCBS Quality Measure Set. The estimate
disregards costs associated with the voluntary reporting of measures in
the HCBS Quality Measure Set that are not yet mandatory, and voluntary
stratification of measures ahead of the phase-in schedule, discussed
later in this section.
Additionally, the Secretary will require stratification by
demographic characteristics of 25 percent of the measures in the HCBS
Quality Measure Set for which the Secretary has specified that
reporting should be stratified 3 years after the effective date of
these regulations, 50 percent of such measures by 5 years after the
effective date of these regulations, and 100 percent of measures by 7
years after the effective date of these regulations. The burden
associated with stratifying data is considered in the ongoing cost
estimate only. We anticipate that certain costs will decline after the
first year of reporting, but that some of the reduction will be
supplanted with costs associated with stratifying data.
With regard to the one-time requirements at Sec. 441.311(c) for
reporting on the initial mandatory elements of the HCBS Quality Measure
Set, we estimate that would take: 540 hours at $108.68/hr for
administrative services managers to conduct project planning,
administer and oversee survey administration, compile measures,
establish and describe performance targets, describe quality
improvement strategies, and produce a report; 40 hours at $95.62/hr for
a statistician to determine survey sampling methodology; 500 hours at
$62.20/hr for survey researcher(s) to be trained in survey
administration and to administer an in-person survey; 200 hours at
$34.56/hr for a data entry worker to input the data; 60 hours at
$92.92/hr for a computer programmer to synthesize the data; and 5 hours
at $204.82/hr for a chief executive to verify, certify, and approve the
report. In aggregate, we estimate a one-time burden of 64,560 hours (48
States x 1,345 hr) at a cost of $5,141,918 (48 States x [(540 hr x
$108.68/hr) + (40 hr x $95.62/hr) + (500 hr x $62.20/hr) + (200 hr x
$34.56/hr) + (60 hr x $92.92/hr) + (5 hr x $204.82/
[[Page 28057]]
hr)]) Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be
$2,570,959 ($5,141,918 x 0.50).
Table 27--Summary of the One-Time Burden for States for the HCBS Quality Measure Set Requirements at Sec. 441.311(c)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Conduct project planning, administer 48 48 Once..................... 5200 25,920 108.68 2,816,986 1,408,493
and oversee survey administration,
compile measures, establish and
describe performance targets,
describe quality improvement
strategies, and produce a report.
Determine survey sampling methodology. 48 48 Once..................... 40 1,920 95.62 183,590 91,795
Receive training in survey 48 48 Once..................... 500 24,000 62.20 1,492,800 746,400
administration and administer an in-
person survey.
Input data............................ 48 48 Once..................... 200 9,600 34.56 346,944 173,472
Synthesize data....................... 48 48 Once..................... 60 2,880 92.92 267,610 133,805
Verify, certify, and approve the 48 48 Once..................... 5 240 204.82 49,157 24,578
report.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 288 Once..................... Varies 64,560 Varies 5,141,918 2,570,959
--------------------------------------------------------------------------------------------------------------------------------------------------------
ii. Ongoing HCBS Quality Measure Set Requirements: States (Sec.
441.311(c))
With regard to the ongoing burden of fulfilling proposed
requirements at Sec. 441.311(c), every other year, for reporting on
mandatory elements of the HCBS Quality Measure Set, including data
stratification by demographic characteristics, we estimate it would
take: 520 hours at $108.68/hr for administrative services managers to
conduct project planning, administer and oversee survey administration,
compile measures, update performance targets and quality improvement
strategy description, and produce a report; 80 hours at $95.62/hr for a
statistician to determine survey sampling methodology; 1,250 hours at
$62.20/hr for survey researcher(s) to be trained in survey
administration and to administer an in-person survey; 500 hours at
$34.56/hr for a data entry worker to input the data; 100 hours at
$92.92/hr for a computer programmer to synthesize the data; and 5 hours
at $204.82/hr for a chief executive to verify, certify, and approve a
State data submission to us. In aggregate, we estimate an ongoing
burden of 117,840 hours (48 States x 2,455 hr) at a cost of $8,136,446
(48 States x [(520 hr x $108.68/hr) + (80 hr x $95.62/hr) + (1,250 hr x
$62.20/hr) + (500 hr x $34.56/hr) + (100 hr x $92.92/hr) + (5 hr x
$204.82/hr)]). Given that reporting is every other year, the annual
burden would be 58,920 hours (117,840 hr/2 years) and $4,068,223
($8,136,446/2 years). Taking into account the Federal contribution to
Medicaid administration, the estimated State share of this cost would
be $2,034,112 ($4,068,223 x 0.50).
Table 28--Summary of the Ongoing Burden for States for the HCBS Quality Measure Set Requirements at Sec. 441.311(c)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Conduct project planning, administer 48 48 Every other year......... 520 24,960 108.68 2,712,653 1,356,326
and oversee survey administration,
compile measures, update performance
targets and quality improvement
strategy description, and produce a
report.
Determine survey sampling methodology. 48 48 Every other year......... 80 3,840 95.62 367,181 183,590
Receive training in survey 48 48 Every other year......... 1,250 60,000 62.20 3,732,000 1,866,000
administration and administer an in-
person survey.
Input data............................ 48 48 Every other year......... 500 24,000 34.56 867,360 433,680
Synthesize data....................... 48 48 Every other year......... 100 4,800 92.92 446,016 223,008
Verify, certify, and approve the 48 48 Every other year......... 5 240 204.82 49,157 24,578
report.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 576 Every other year......... Varies 235,680 Varies 8,174,366 4,087,183
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. HCBS Quality Measure Set Requirements: Beneficiary Experience Survey
(Sec. 441.311(c))
State adoption of existing beneficiary experience surveys,
contained in the HCBS Quality Measure Set, to fulfill the proposed
mandatory reporting requirements would include a burden on
beneficiaries. As proposed in the previous section, a State must newly
adopt one of the ``experience of care'' surveys cited in the HCBS
Quality Measure Set: The Consumer Assessment of Healthcare Providers
and Systems Home and Community Based (HCBS CAHPS[supreg]) Survey,
National Core Indicators[supreg] Intellectual and Developmental
Disabilities (NCI[supreg] IDD), National Core Indicators Aging and
Disability (NCI AD)TM, or Personal Outcome Measures
(POM)[supreg].
With regard to beneficiary burden, we estimate it would take 45
minutes (0.75 hr) at $20.71/hr for a Medicaid beneficiary to complete a
survey every other year that will be used to derive one or more of the
measures in the
[[Page 28058]]
HCBS Quality Measure Set. At 1,000 beneficiaries/State and 48 States,
we estimate an aggregate burden of 36,000 hours (1,000 beneficiary
responses/State x 48 States x 0.75 hr/survey) at a cost of $ 745,560
(36,000 hr x $20.71/hr). Given that survey is every other year, the
annual burden would be 18,000 hours (36,000 hr/2 years) and $372,780
($745,560/2 years).
Table 29--Summary of Beneficiary Experience Survey Burden for the HCBS Quality Measure Set Requirements at Sec. 441.311(c)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total Wage ($/ Total State
respondents responses (hr) time (hr) hr) cost ($) share ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Complete beneficiary experience survey 48,000 24,000 Annually................. 0.75 18,000 20.71 372,780 n/a
-----------------------------------------------------------------------------------------------------------------
Total............................. 48,000 48,000 Every other Year......... 0.75 18,000 20.71 745,560 n/a
--------------------------------------------------------------------------------------------------------------------------------------------------------
10. ICRs Regarding Website Transparency (Sec. 441.313; Cross-
Referenced to Sec. Sec. 441.486, 441.595, and 441.750, as Well as Part
438)
The proposed rule adds a new section, at Sec. 441.313, titled,
``website Transparency, to promote public transparency related to the
administration of Medicaid-covered HCBS under section 1915(c) of the
Act.'' Specifically, at Sec. 441.313(a), we propose to require States
to operate a website that meets the availability and accessibility
requirements at Sec. 435.905(b) and that provides the data and
information that States are required to report under the newly proposed
reporting section at Sec. 441.311. At Sec. 441.313(a)(1), we propose
to require that the data and information that States are required to
report under Sec. 441.311 be provided on one website, either directly
or by linking to the web pages of the managed care organization,
prepaid ambulatory health plan, prepaid inpatient health plan, or
primary care case management entity that is authorized to provide
services. At Sec. 441.313(a)(2), we propose to require that the web
page include clear and easy to understand labels on documents and
links.
At Sec. 441.313(a)(3), we propose to require that States verify
the accurate function of the website and the timeliness of the
information and links at least quarterly. At Sec. 441.313(c), we
propose to apply these requirements to services delivered under FFS or
managed care delivery systems. At Sec. 441.313(a)(4), we propose to
require that States explain that assistance in accessing the required
information on the website is available at no cost and include
information on the availability of oral interpretation in all languages
and written translation available in each prevalent non-English
language, how to request auxiliary aids and services, and a toll-free
and TTY/TDY telephone number. Further, we propose to apply the proposed
requirements at Sec. 441.313 to sections 1915(j), (k), and (i) State
plan services by cross-referencing at Sec. Sec. 441.486, 441.595, and
441.750, respectively.
The following proposed changes will be submitted to OMB for their
approval after this proposed rule is finalized and our survey
instrument has been developed. The survey instrument and burden will be
made available to the public for their review under the standard non-
rule PRA process which includes the publication of 60- and 30-day
Federal Register notices. In the meantime, we are setting out our
preliminary burden figures (see below) as a means of scoring the impact
of this rule's proposed changes. The availability of the survey
instrument and more definitive burden estimates will be announced in
both Federal Register notices. The CMS ID number for that collection of
information request is CMS-10854 (OMB control number 0938-TBD). Since
this would be a new collection of information request, the OMB control
number has yet to be determined (TBD) but will be issued by OMB upon
their approval of the new collection of information request.
The burden associated with the website transparency requirements
proposed at Sec. 441.313 will affect the 48 States (including
Washington, DC) that deliver HCBS under sections 1915(c), (i), (j), or
(k) authorities. We are requiring at Sec. 441.313(c) to apply the
website transparency requirements to services delivered under FFS or
managed care delivery systems, and we propose to provide States with
the option to meet the requirements at Sec. 441.313 by linking to the
web pages of the managed care organization, prepaid ambulatory health
plan, prepaid inpatient health plan, or primary care case management
entity that are authorized to provide services. However, we are not
requiring managed care entities to report the data and information
required under Sec. 441.311 on their website. As such, we estimate
that there is no additional burden for managed care entities associated
with the requirements to link to the web pages of the managed care
organization, prepaid ambulatory health plan, prepaid inpatient health
plan, or primary care case management entity that are authorized to
provide services for Sec. 441.313. Further, the burden associated with
the requirements for managed care entities to report the data and
information required under Sec. 441.311 is estimated in the ICRs
Regarding Compliance Reporting (Sec. 441.311(b)).
If a State opts to comply with the requirements at Sec. 441.313 by
linking to the web pages of the managed care organization, prepaid
ambulatory health plan, prepaid inpatient health plan, or primary care
case management entity that are authorized to provide services, the
State would incur a burden. However, such burden would be less than the
burden associated with posting the information required under Sec.
441.311 on their own website. We are unable to estimate the number of
States that may opt to comply with the requirements at Sec. 441.313 by
linking to the web pages of the managed care organization, prepaid
ambulatory health plan, prepaid inpatient health plan, or primary care
case management entity that are authorized to provide services. As a
result, we do not take into account the option in our burden estimate
and conservatively assume that all States subject to the requirements
at Sec. 441.313 by posting the information required under Sec.
441.311 on their own website.
We estimate both a one-time and ongoing burden to implement these
requirements at the State level.
a. One Time Website Transparency Requirements: States (Sec. 441.313)
The burden associated with the website transparency requirements
proposed at Sec. 441.313 will affect the 48 States (including
Washington, DC) that deliver HCBS under sections 1915(c), (i), (j), or
(k) authorities. We estimate
[[Page 28059]]
both a one-time and ongoing burden to implement these requirements at
the State level. In developing our burden estimate, we assumed that
States would provide the data and information that States are required
to report under newly proposed Sec. 441.311 through an existing
website, rather than develop a new website to meet this requirement.
With regard to the one-time burden, based on the website
transparency requirements, we estimate it would take: 24 hours at
$108.68/hr for an administrative services manager to determine the
content of the website; 80 hours at $92.92/hr for a computer programmer
or contractor to develop the website; 3 hours at $110.82/hr for a
general and operations manager to review and approve the website; and 2
hours at $204.82/hr for a chief executive to review and approve the
website. In aggregate, we estimate a one-time burden of 5,232 hours (48
States x 109 hr) at a cost of $517,633 (48 States x [(24 hr x $108.68/
hr) + (80 hr x $92.92/hr) + (3 hr x $110.82/hr) + (2 hr x $204.82/
hr)]). Taking into account the Federal contribution to Medicaid
administration, the estimated State share of this cost would be
$258,817 ($517,633 x 0.50) per year.
Table 30--Summary of the One-Time Burden for States for the Website Transparency Requirements at Sec. 441.313
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per State
Requirement Number of Total Frequency response Total Wage ($/ Total share ($)/
respondents responses (hr) time (hr) hr) cost ($) year
--------------------------------------------------------------------------------------------------------------------------------------------------------
Determine content of website.......... 48 48 Once..................... 24 1,152 108.68 125,199 62,600
Develop website....................... 48 48 Once..................... 80 3,840 92.92 356,813 178,406
Review and approve the website at the 48 48 Once..................... 3 144 110.82 15,958 7,979
management level.
Review and approve the website at the 48 48 Once..................... 2 96 204.82 19,663 9,831
executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 192 Once..................... Varies 5,232 Varies 517,633 258,816
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Ongoing Website Transparency Requirements: States (Sec. 441.313)
With regard to the State on-going burden related to the website
transparency requirement, per quarter we estimate it would take: 8
hours at $108.68/hr for an administrative services manager to provide
updated data and information for posting and to verify the accuracy of
the website; 20 hours at $92.92/hr for a computer programmer or
contractor to update the website; 3 hours at $110.82/hr for a general
and operations manager to review and approve the website; and 2 hours
at $204.82/hr for a chief executive to review and approve the website.
In aggregate, we estimate an ongoing annual burden of 6,336 hours (33
hr x 48 States x 4 quarters) at a cost of $666,228 (48 States x 4
quarters x [(8 hr x $108.68/hr) + (20 hr x $92.92/hr) + (3 hr x
$110.82/hr) + (2 hr x $204.82/hr)]). Taking into account the Federal
contribution to Medicaid administration, the estimated State share of
this cost would be $333,114 ($666,228 x 0.50) per year.
Table 31--Summary of the Ongoing Burden for States for the Website Transparency Requirements at Sec. 441.313
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Provide updated data and information 48 192 Quarterly................ 8 1,536 108.68 166,932 83,466
for posting and verify the accuracy
of the website.
Update website........................ 48 192 Quarterly................ 20 3,840 92.92 356,813 178,406
Review and approve website at the 48 192 Quarterly................ 3 576 110.82 63,832 31,916
management level.
Review and approve website at the 48 192 Quarterly................ 2 384 204.82 78,651 39,325
executive level.
-----------------------------------------------------------------------------------------------------------------
Total............................. 48 768 Quarterly................ Varies 6,336 Varies 666,228 333,114
--------------------------------------------------------------------------------------------------------------------------------------------------------
11. ICRs Regarding Payment Rate Transparency (Sec. 447.203)
The following proposed changes will be submitted to OMB for review
under control number 0938-1134 (CMS-10391).
This proposed rule would update documentation requirements in Sec.
447.203. To develop the burden estimates associated with these changes,
we account for the removal of existing information collection
requirements in current Sec. 447.203(b), and the introduction of new
requirements at proposed 447.203(b) and (c). As described later in this
section, we estimate the impact of the proposed revisions to Sec.
447.203 would result in a net burden reduction. We do not anticipate
any additional information collection burden from the conforming edits
proposed in Sec. 447.204, as the conforming edits merely alter the
items submitted as part of an existing submission requirement, and the
burden of producing those items is reflected in the estimates related
to Sec. 447.203, including instances where we propose to move language
from Sec. 447.204 to Sec. 447.203.
a. Removal of Access Monitoring Review Plan: States (Sec.
447.203(b)(1) Through (8))
The burden reduction associated with the removal of Sec.
447.203(b)(1) through (8) consists of the removal of time and effort
necessary to develop and publish AMRPs, perform ongoing monitoring, and
corrective action plans.
Current Sec. 447.203(b)(1) and (2) describes the minimum factors
that States must consider when developing an AMRP. Specifically, the
AMRP must include: input from both Medicaid beneficiaries and Medicaid
providers, an analysis of Medicaid payment data,
[[Page 28060]]
and a description of the specific measures the State will use to
analyze access to care. Current 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 Medicare rates) and private health coverage rates within
geographic areas of the State. Current Sec. 447.203(b)(4) describes
the minimum content that must be included in the monitoring plan.
States are required to describe: 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. Current Sec. 447.203(b)(5)
describes the timeframe for States to develop the AMRP 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 SPA to reduce or
restructure provider payments which changes could result in diminished
access, and additional services as determined necessary by the State or
CMS based on complaints or as selected by the State. While the initial
AMRPs have been completed, the plan must be updated at least every 3
years, but no later than October 1 of the update year. Current Sec.
447.203(b)(6)(i) requires that any time a State submits a SPA to reduce
provider payment rates or restructure provider payments in a way that
could diminish access, the State must submit an AMRP associated with
the services affected by the payment rate reduction or payment
restructuring that has been completed within the prior 12 months.
Section 447.203(b)(6)(ii) requires that States have procedures
within the AMRP 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 3 years following
the effective date of the SPA. However, 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. Therefore, removal of
Sec. 447.203(b)(6)(ii) will result in a burden reduction.
Finally, we note that this section references the proposed
rescission of the current AMRP process contained in Sec. 447.203(b)(1)
to Sec. 447.203(b)(8). However, the requirements of paragraph (b)(7)
are reflected in proposed paragraph (b)(4), and the requirements of
paragraph (b)(8) are reflected in proposed paragraph (c)(5). As such,
there is not a change in impact related to the rescission of these
specific aspects of the AMRP process, should our proposals be
finalized, and are not reflected in this section.
In our currently approved information collection request, we
estimated that the requirements to develop and make the AMRPs publicly
available for the specific categories of Medicaid services will affect
each of the 50 State Medicaid programs and the District of Columbia (51
total respondents). We will use that estimate here as well, although we
note that the figure does not represent solely those States, but may
include territories not exempt under waivers, and exclude States not
subject due to reliance entirely on managed care (with no beneficiaries
receiving any benefits through FFS delivery), and these figures
fluctuate. As such, for consistency, we will maintain the estimate of
51 respondents subject to this proposed rule. We further note that the
one-time cost estimates have already been met for AMRPs, and the
ongoing monitoring requirements are every 3 years. As such, the
estimates in this section for burden reduction are for 17 respondents,
one-third of the 51 affected respondents, to provide an annual estimate
of the reduced burden.
We estimated that every 3 years, it would take: 80 hours at $54.26/
hr for a research analyst to gather data, 80 hours at $100.80/hr for an
information analyst to analyze the data, 100 hours at $96.66/hr for a
management analyst to develop the content of the AMRP, 40 hours at
$77.28/hr for a business operations specialist to publish the AMRP, and
10 hours at $110.82/hr for managerial staff to review and approve the
AMRP. In aggregate, and as shown in Table 35, we estimate the reduced
annual burden of the rescission of the ongoing AMRP requirements would
be minus 5,270 hours (17 States x 310 hr) and minus $446,593 (17 States
x [(80 hr x $54.26/hr) + (80 hr x $100.80/hr) + (100 hr x $96.66/hr) +
(40 hr x $77.28/hr) + (10 hr x $110.82/hr)]). Taking into account the
50 percent Federal contribution for administrative expenditures, the
rescission represents a saving to States of minus $223,297 ($446,593 x
0.50).
The currently approved ongoing burden associated with the
requirements under Sec. 447.203(b)(6)(ii) is the time and effort it
takes 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, we estimate that in each SPA submission cycle, 22 States would
submit SPAs to implement rate changes or restructure provider payments
based on the number of submissions received in FY 2010. Using our
currently approved burden estimates we estimate a reduction of: 40
hours at $96.66/hr for a management analyst to develop the monitoring
procedures, 24 hours at $96.66/hr for a management analyst to
periodically review the monitoring results, and 3 hours at $110.82/hr
for a general and operations manager to review and approve the
monitoring procedures. In aggregate, we estimate burden reduction of
minus 1,474 hours (22 Respondents x 67 hr) and minus $143,411 (22
States x [(40 hr x $96.66/hr) + (24 hr x $96.66/hr) + (3 hr x $110.82/
hr)]). Accounting for the 50 percent Federal administrative match, the
total State cost reduction is adjusted to $71,706 ($143,411 x 0.50).
Table 32--Summary of Annual Burden Reduction Associated With Removal of Access Monitoring Review Plan Requirements
[Sec. 447.203(b)(1) through (8)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total time Wage ($/ Total cost State share
respondents responses (hr) (hr) hr) ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rescission of Sec. 447.203(b)(1) 17 17 Triennial (figures are (310) (5,270) Varies (446,593) (223,297)
through (b)(6)(i). annualized).
Rescission of Sec. 22 22 Varies (figures are (67) (1,474) Varies (143,411) (71,706)
447.203(b)(6)(ii). annualized).
-------------------------------------------------------------------------------------------------------------------
Total........................... 39 39 Varies................. Varies (6,744) Varies (590,004) (295,003)
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 28061]]
b. Payment Rate Transparency (Sec. 447.203(b)(1) Through (5))
We are proposing to replace the AMRP requirements with a new
payment rate transparency requirement at Sec. 447.203(b)(1) through
(5). The burden associated with the proposed payment rate transparency
requirement consists of the time and effort to develop and publish a
Medicaid FFS provider payment rate information and analysis.
Proposed Sec. 447.203(b)(1) specifies that all FFS Medicaid
payments must be published on a publicly accessible website that is
maintained by the State. Proposed Sec. 447.203(b)(2) specifies the
service types that are subject to the proposed payment analysis, which
include: primary care services; obstetrical and gynecological services;
outpatient behavioral health services; and certain HCBS. Proposed Sec.
447.203(b)(3) describes the required components of the payment analysis
to include, for services in proposed Sec. 447.203(b)(2)(i) through
(iii), a percentage comparison of Medicaid payment rates to the most
recently published Medicare payment rates effective for the time period
for each of the service categories specified in paragraph (b)(2). We
also specify that the payment analysis must include percentage
comparisons made on the basis of Medicaid base payments. For HCBS
described in proposed Sec. 447.203(b)(2)(iv), we propose to require a
State-based comparison of average hourly payment rates. Proposed Sec.
447.203(b)(4) details the payment analysis timeframe, with the first
payment analysis required to be published by the State agency by
January 1, 2026, and updated every 2 years by January 1. Proposed Sec.
447.203(b)(5) describes our mechanism for ensuring compliance and that
we may take compliance action against a State that fails to meet the
requirements of the payment rate transparency, comparative payment rate
analysis, and payment rate disclosure provisions in preceding proposed
paragraphs in Sec. 447.203(b) including a deferral or disallowance of
certain of the State's administrative expenditures following the
procedures described at part 430, subpart C.
We estimate that the proposed requirements to complete and make
publicly available all FFS Medicaid payments and the comparative
payment rate analysis and payment rate disclosures under Sec.
447.203(b)(1) through (5) for the specific categories of Medicaid
services would affect 51 total respondents, based on the estimate in
the prior section regarding the variation in States and territories
subject to these requirements. We propose to require applicable States
and territories to publish all FFS Medicaid payments initially by
January 1, 2026, while future updates to the payment rate transparency
information would depend on when a State submits a SPA updating
provider payments and we have approved that SPA. As such, we assume 51
one-time respondents for the initial rates publication. Because the
comparative payment rate analysis and payment rate disclosure
requirement is biennial, we assume 26 annual respondents in any given
year, and we will assume this figure would account for the updates made
following a rate reduction SPA or rate restructuring SPA approval. The
proposed comparative payment rate analysis would be similar to the
current requirement at Sec. 447.203(b)(3) that requires AMRPs to
include a comparative payment rate analysis against public or private
payers. The inclusion of levels of provider payment available from
other payers is also one of five required components of the AMRP as
specified by current Sec. 447.203(b)(1). To estimate the burden
associated with our proposed comparative payment rate analysis and
payment rate disclosure provisions, we assume this work would require
approximately 25 percent of the ongoing labor hour burden that we
previously estimated to be required by the entire AMRP, to account for
the service categories subject to the comparative payment rate analysis
and payment rate disclosure in proposed Sec. 447.203(b)(2) as
decreased from the full body of AMRP service requirements. We invite
comment on these estimated proportions.
With regard to the developing and publishing the payment rate
transparency data at proposed Sec. 447.203(b)(1), we estimate a low
one-time and ongoing burden due to the data being available, and the
main work required to meet the proposed requirement would be formatting
and web publication. As such, we estimate it would initially take: 5
hours at $54.26/hr for a research assistant to gather the data, 5 hours
at $77.28/hr for a business operations specialist to publish, and 1
hour at $110.82/hr for a general and operations manager to review and
approve the rate transparency data. In aggregate, we estimate a one-
time burden of 561 hours (51 Respondents x 11 hr) at a cost of $39,195
(51 Respondents x [(5 hr x $54.26/hr) + (5 hr x $77.28/hr) + (1 hr x
$110.82/hr)]). Taking into account the Federal administrative match of
50 percent, the requirement will cost States $19,597 ($39,195 x 0.50).
For the ongoing cost to update assumed to take place every 2 years
(although we are proposing that updates would only be required as
necessary to keep the data current, with any update made no later than
1 month following the date of CMS approval of the SPA or similar
amendment providing for the change), we estimate an annualized impact
on 26 respondents (51 respondents every 2 years) of: 2 hours at $54.26/
hr for a research assistant to update the data, 1 hour at $77.28/hr for
a business operations specialist to publish the updates, and 1 hour at
$110.82/hr for a general and operations manager to review and approve
the rate transparency update. In aggregate, we estimate an annualized
burden of 104 hours (26 Respondents x 4 hr) at a cost of $7,712 (26
Respondents x [(2 hr x $54.26/hr) + (1 hr x $77.28/hr) + (1 hr x
$110.82/hr)]). Taking into account the Federal administrative match of
50 percent, the requirement will cost States $3,856 ($7,712 x 0.50).
With regard to developing and publishing the comparative payment
rate analysis and payment rate disclosure at proposed Sec.
447.203(b)(2), we estimate it would take: 20 hours at $54.26/hr for a
research assistant to gather the data, 20 hours at $100.80/hr for an
information analyst to analyze the data, 25 hours at $96.66/hr for a
management analyst to design the comparative payment rate analysis, 11
hours at $77.28/hr for a business operations specialist to publish the
comparative payment rate analysis and payment rate disclosure, and 3
hours at $110.82/hr for a general and operations manager to review and
approve the comparative payment rate analysis and payment rate
disclosure. In aggregate, we estimate an annualized burden, based on 51
respondents every 2 years, of 2,054 (26 Respondents x 79 hr) at a cost
of $174,206 (26 States x [(20 hr x $54.26/hr) + (20 hr x $100.80/hr) +
(25 hr x $96.66/hr) + (11 hr x $77.28/hr) + (3 hr x $110.82/hr)]). We
then adjust the total cost to $87,103 ($174,206 x 0.50) to account for
the 50 percent Federal administrative match. We have summarized the
total burdens in Table 33.
[[Page 28062]]
Table 33--Summary of Burden Associated With Proposed Payment Rate Transparency Requirements
[Proposed Sec. 447.203(b)(1) through (5)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per
Requirement Number of Total Frequency response Total time Wage ($/ Total cost State share
respondents responses (hr) (hr) hr) ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 447.203(b)(1) Rate 51 51 One-time............... 11 561 Varies 39,195 19,597
Transparency.
Sec. 447.203(b)(1) Rate 26 26 Biannual (figures are 4 104 Varies 7,712 3,856
Transparency. annualized).
Sec. 447.203(b)(2) and (3) Rate 26 26 Biannual (figures are 79 2,054 Varies 174,206 87,103
Analysis. annualized).
-------------------------------------------------------------------------------------------------------------------
Total........................... 51 103 Varies................. Varies 2,719 Varies 221,113 110,557
--------------------------------------------------------------------------------------------------------------------------------------------------------
c. Medicaid Payment Rate Interested Parties' Advisory Group (Sec.
447.203(b)(6))
The burden associated with the recordkeeping requirements proposed
Sec. 447.203(b)(6), specifically the online publication associated
with the reporting and recommendations of the interested parties
advisory group, would consist of the time and effort for all 50 States
and the District of Columbia to:
Appoint members to the interested parties' advisory group.
Provide the group members with materials necessary to:
++ Review current and proposed rates.
++ Hold meetings.
++ Provide a written recommendation to the State.
Publish the group's recommendations to a website
maintained by the single State agency.
The proposed requirements would require varying levels of efforts
for States depending on the existence of groups that may fulfil the
requirements of this group. However, because it is unknown how many
States would be able to leverage existing practices, and to what
extent, this estimate does not account for those differences.
We estimate that it would take 40 hours at $131.34/hr for a human
resources manager to recruit interested parties and provide the
necessary materials for the group to meet. In aggregate, we estimate a
one-time burden of 2,040 hours (51 Respondents x 40 hr) at a cost of
$267,934 (2,040 hr x $131.34/hr). Taking into account the 50 percent
administrative match, the total one-time State cost is estimated to be
$133,967 ($267,934 x 0.50).
We believe the ongoing work to maintain the needs of this group
would take a human resources manager 5 hours at $131.34/hr annually.
Additionally, we estimate it would take 4 hours for the biennial
requirement, or 2 hours annually at $110.82/hr for an operations
manager to review and prepare the recommendation for publication. In
aggregate, we estimate an ongoing annualized burden of 182 hours (26
Respondents x 7 hr) at a cost of $22,837 (26 Respondents x [(5 hr x
$131.34/hr) + (2 hr x $110.82/hr)]). Accounting for the 50 percent
Federal administrative match, the total State cost is adjusted to
$11,418 ($22,837 x 0.50). We have summarized the total burdens in Table
34.
Table 34--Summary of Burden for Medicaid Payment Rate Interested Parties' Advisory Group
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 447.203(b)(6) (Establish advisory 51 51 One-time.................... 40 2,040 131.34 267,934 133,967
group).
Sec. 447.203(b)(6) (Support and publish 51 26 Biennial (figures are 7 182 Varies 22,837 11,418
recommendation). annualized).
--------------------------------------------------------------------------------------------------------------
Total................................ 51 77 Varies...................... Varies 2,222 Varies 290,771 145,386
--------------------------------------------------------------------------------------------------------------------------------------------------------
d. State Analysis Procedures for Payment Rate Reductions or Payment
Restructuring (Sec. 447.203(c))
The proposed State analysis procedures for payment rate reductions
and payment restructurings at Sec. 447.203(c)(1) through (3) within
this proposed rule effectively would replace payment rate reduction or
payment restructuring procedures in current Sec. 447.203(b)(6). As
noted, the burden reduction associated with the removal of Sec.
447.203(b)(6)(i) has already been accounted for in the recurring burden
reduction estimate shown in Table 36 for the removal of the AMRP
requirements, and the burden reduction associated with the removal of
monitoring requirements at current Sec. 447.203(b)(6)(ii) has been
accounted for in Table 37. Our proposed replacement procedures at Sec.
447.203(c)(1) through (3) would introduce new requirements as follows.
i. Initial State Analysis for Rate Reduction or Restructuring (Sec.
447.203(c)(1))
Proposed Sec. 447.203(c)(1) would require that for States
proposing to reduce or restructure provider payment rates, the State
must document that their program and proposal meet all of the following
requirements: (i) Medicaid rates in the aggregate for the service
category following the proposed reduction(s) or restructurings are at
or above 80 percent of most recent Medicare prices or rates for the
same or a comparable set of services; (ii) Proposed reductions or
restructurings result in no more than a 4 percent reduction of overall
spending for each service category affected by a proposed reduction or
restructuring in a single State fiscal year; and (iii) Public process
yields no significant access concerns or the State can reasonably
respond to concerns.
Proposed Sec. 447.203(c)(1) would apply to all States that submit
a SPA that proposes to reduce or restructure provider payment rates. We
limited our estimates for new information collection burden to the
requirements at Sec. 447.203(c)(1)(i) through (ii). Our estimates
assume States will build off the comparative analysis required by
proposed Sec. 447.203(b)(2) through (4) to complete the requirements
proposed by Sec. 447.203(c)(1)(i), which will limit the additional
information collection burden. We also assume no additional
[[Page 28063]]
information collection burden posed by the public review process
required by proposed Sec. 447.203(c)(1)(iii), as this burden is
encapsulated by current public process requirements at Sec. 447.204.
The requirements of proposed Sec. 447.203(c) apply to all 50
States and the District of Columbia, as well as US territories. We will
again use the estimate of 50 utilized in preceding sections, which we
note may include territories not exempt under waivers, and exclude
States not subject due to reliance entirely on managed care (with no
beneficiaries receiving any benefits through FFS delivery), and these
figures fluctuate. As such, for consistency, we will maintain the
estimate of 51 respondents subject to this proposed rule. While we
cannot predict how many States will submit a rate reduction SPA or rate
restructuring SPA in a given year, the figures from 2019 provide the
best recent estimate, as the years during the COVID pandemic do not
reflect typical behavior. In 2019, we approved rate reduction and rate
restructuring SPAs from 17 unique State respondents. Therefore, to
estimate the annualized number of respondents subject to this
information collection burden, we will utilize a count of 17
respondents.
With regard to the burden associated with completing the required
State analysis for proposed rate reductions or restructurings at Sec.
447.203(c)(1), we estimate that it would take: 20 hours at $96.66/hr
for a management analyst to structure the rate reduction or
restructuring analysis, 25 hours at $100.80/hr for an information
analyst to complete the rate reduction or restructuring analysis, and 3
hours at $110.82/hr for a general and operations manager to review and
approve the rate reduction or restructuring analysis. In aggregate, we
estimate a burden of 816 hours (17 States x 48 hr) at a cost of $81,356
(17 States x [(20 hr x $96.66/hr) + (25 hr x $100.80/hr) + (3 hr x
$110.82/hr)]). Accounting for the 50 percent Federal administrative
reimbursement, this adjusts to a total State cost of $40,678 ($81,356 x
0.50). We are soliciting public comment on these estimates as well as
relevant State data to further refine the burden and time estimates.
Table 35--Burden Associated With Tier 1 State Analysis Procedures for Rate Reductions or Restructurings
[Proposed Sec. 447.203(c)(1)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/hr) Total share
respondents responses (hr) (hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 447.203(c)(1)............... 17 17 Annual................ 48 816 Varies............... 81,356 40,678
--------------------------------------------------------------------------------------------------------------------
Total.......................... 17 17 Annual................ 48 816 Varies............... 81,356 40,678
--------------------------------------------------------------------------------------------------------------------------------------------------------
ii. Additional State Rate Analysis (Sec. 447.203(c)(2))
Proposed Sec. 447.203(c)(2) describes requirements for payment
proposals that do not meet the requirements in paragraph (c)(1),
requiring the State to provide the nature of the change and policy
purpose, the rates compared to Medicare and/or other payers pre- and
post-reduction or restructuring, counts/trends of actively
participating providers by geographic areas, counts of FFS Medicaid
beneficiaries residing in geographic areas/characteristics of the
beneficiary population, service utilization trends, access to care
complaints from beneficiaries, providers, and other interested parties,
and the State's response to access to care complaints.
The information collection requirements proposed at Sec.
447.203(c)(2) applies to those States that submit rate reduction or
restructuring SPAs that do not meet one or more of the criteria
proposed by Sec. 447.203(c)(1). Using 2019 rate reduction and
restructuring SPA figures, we estimate that 17 States will submit rate
reduction or restructuring SPAs per year. Then, a 2019 Urban Institute
analysis \262\ indicates that 22 States (or 43 percent) have rates that
meet the 80 percent fee ratio threshold proposed in Sec.
447.203(c)(1)(i) across all services. Although our proposal does not
include all services, using this all services amount is our best method
to estimate how many States may fall below on any given service without
knowing which. Because we cannot predict the amount a State may propose
to reduce, once or cumulatively for the SFY, and because failure of any
one criterion in Sec. 447.203(c)(1) would require additional analysis
under Sec. 447.203(c)(2), we will use that percentage to assess how
many States would need to perform additional analysis. Using this
percentage, we estimate that 7 (43 percent x 17) of the estimated 17
unique State respondents may submit rate reduction or restructuring
SPAs meet that criteria for the streamlined analysis process under
proposed Sec. 447.203(c)(1). Therefore, we assume that 10 out of 17
unique annual State respondents who submit rate reduction or
restructuring SPAs would also need to perform the additional analysis
Sec. 447.203(c)(2).
---------------------------------------------------------------------------
\262\ Zuckerman, S. et al. ``Medicaid Physician Fees Remained
Substantially Below Fees Paid By Medicare in 2019.'', Health
Affairs, Volume 40, Number 2, February 2021, p. 343-348, https://www.healthaffairs.org/doi/10.1377/hlthaff.2020.00611, accessed
August 31, 2022.
---------------------------------------------------------------------------
The required components of the review and analysis in proposed
Sec. 447.203(c)(2) are similar to the AMRP requirements found at
current Sec. 447.203(b)(1). However, due to the anticipated
development and release of a template for States to facilitate
completion of the required analysis, as well as the lack of a
requirement to publish the analysis, we anticipate a moderately reduced
burden associated with proposed Sec. 447.203(c)(2) when compared to
the burden estimated for the AMRPs.
With regard to our proposed requirements, we estimate that it would
take: 64 hours at $54.26/hr for a social science research assistant to
gather data, 64 hours at $100.80/hr for a computer and information
analyst to analyze data, 80 hours at $96.66/hr for a management analyst
to structure the analyses and organize output, and 8 hours at $110.82/
hr for a general and operations manager to review and approve the rate
reduction or restructuring analysis. In aggregate, we estimate a burden
of 2,160 hours (10 States x 216 hr) at a cost of $185,432 (10 States x
[(64 hr x $54.26/hr) + (64 hr x $100.80/hr) + (80 hr x $96.66/hr) + (8
hr x $110.82/hr)]). The total cost is adjusted down to $92,716
($185,432 x 0.50) for States after accounting for the 50 percent
Federal administrative match. We are soliciting public comment on these
estimates as well as relevant State data to further refine the burden
and time estimates.
We do not assume any additional information collection imposed by
the
[[Page 28064]]
compliance procedures proposed by Sec. 447.203(c)(3).
Table 41 shows our estimated combined annualized burden for Sec.
447.203(c), which includes 17 States for Sec. 447.203(c)(1) and 10
States for Sec. 447.203(c)(2). In total, we estimate an annualized
burden of 4,992 (1,104 hours + 2,160 hours) hours at a cost of $443,848
($110,070 + $74,172). This cost to States is then adjusted to $221,924
after the 50 percent Federal administrative reimbursement is applied.
Table 36--Summary of Burden Associated With State Analysis Procedures for Rate Reductions or Restructurings
[Proposed Sec. 447.203(c)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Time per Total State
Requirement Number of Total Frequency response time Wage ($/ Total share
respondents responses (hr) (hr) hr) cost ($) ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 447.203(c)(1) (initial State 17 17 Annual...................... 48 816 Varies 81,356 40,678
analysis).
Sec. 447.203(c)(2) (additional State 12 12 Annual...................... 216 2,160 Varies 185,432 92,716
analysis).
--------------------------------------------------------------------------------------------------------------
Total................................ 17 29 Annual...................... 264 2,976 Varies 266,788 133,394
--------------------------------------------------------------------------------------------------------------------------------------------------------
D. Proposed Burden Estimate Summary
Table 37--Summary of Proposed Annual Burden Estimates
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Total
Regulation section(s) in Title 42 OMB Control Number Number of Number of Time per response Total time Hourly labor Rate Total labor State share beneficiary
of the CFR (CMS ID Number) respondents responses (hr) (hr) ($/hr) cost ($) ($) cost ($)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 431.12 (Table 2) (MACs & OMB 0938-TBD (CMS- 51 States............ 153 Varies.............. 17,340 Varies.............. 1,581,591 790,795 n/a
BAGs). 10845).
Sec. 441.301(c)(3)--One-time OMB 0938-TBD (CMS- 48 States............ 144 Varies.............. 528 Varies.............. 62,203 31,102 n/a
burden to States (Table 3) 10854).
(Person-Centered Service Plans).
Sec. 441.301(c)(3)--One-time OMB 0938-TBD (CMS- 161 MCEs............. 322 Varies.............. 966 Varies.............. 120,463 n/a n/a
burden to Managed Care Entities 10854).
(Table 4) (Person-Centered
Service Plans).
Sec. 441.301(c)(7)--One-time OMB 0938-TBD (CMS- 48 States............ 240 Varies.............. 24,960 Varies.............. 2,481,926 1,240,964 n/a
burden to States (Table 5) 10854).
(Grievance Systems).
Sec. 441.301(c)(7)--Ongoing OMB 0938-TBD (CMS- 48 States............ 58,558 Varies.............. 16,206 Varies.............. 1,081,374 540,687 n/a
burden to States (Table 6) 10854).
(Grievance Systems).
Sec. 441.302(a)(6)--One-time OMB 0938-TBD (CMS- 48 States............ 384 Varies.............. 19,872 Varies.............. 124,874,125 62,437,063 n/a
burden to States (Table 7) 10854).
(Incident Management System).
Sec. 441.302(a)(6)--Ongoing OMB 0938-TBD (CMS- 48 States............ 283,638 Varies.............. 15,177 Varies.............. 24,732,634 12,366,317 n/a
burden to States (Table 8) 10854).
(Incident Management System).
Sec. 441.302(a)(6)--Ongoing OMB 0938-TBD (CMS- 15,742 providers..... 28,345 1................... 28,345 110.82.............. 3,141,193 n/a n/a
burden to Service Providers 10854).
(Table 9) (Incident Management
System).
Sec. 441.302(a)(6)--One-time OMB 0938-TBD (CMS- 161 MCEs............. 805 Varies.............. 26,726 Varies.............. 2,576,084 n/a n/a
burden to Managed Care Entities 10854).
(Table 10) (Incident Management
System).
Sec. 441.302(a)(6)--Ongoing OMB 0938-TBD (CMS- 161 MCEs............. 7,286 Varies.............. 5,476 Varies.............. 503,633 n/a n/a
burden to Managed Care Entities 10854).
(Table 11) (Incident Management
System).
Sec. 441.302(k)--One-time burden OMB 0938-TBD (CMS- 48 States............ 288 Varies.............. 9,792 Varies.............. 916,693 458,347 n/a
to States (Table 12) (HCBS 10854).
Payment Adequacy).
Sec. 441.302(k)--Ongoing burden OMB 0938-TBD (CMS- 48 States............ 144 Varies.............. 432 Varies.............. 47,231 23,616 n/a
to States (Table 13) (HCBS 10854).
Payment Adequacy).
Sec. 441.302(k)--One-time burden OMB 0938-TBD (CMS- 11,555 Providers..... 34,665 Varies.............. 959,065 Varies.............. 81,897,911 n/a n/a
to service providers (Table 14) 10854).
(HCBS Payment Adequacy).
Sec. 441.302(k)--Ongoing burden OMB 0938-TBD (CMS- 11,555 Providers..... 34,665 Varies.............. 242,655 Varies.............. 21,553,542 n/a n/a
to service providers (Table 15) 10854).
(HCBS Payment Adequacy).
Sec. 441.302(k)--One-time burden OMB 0938-TBD (CMS- 161 MCEs............. 644 Varies.............. 15,778 Varies.............. 1,486,877 n/a n/a
to managed care entities (Table 10854).
16) (HCBS Payment Adequacy).
Sec. 441.302(k)--Ongoing burden OMB 0938-TBD (CMS- 161 MCEs............. 322 Varies.............. 1,288 Varies.............. 155,713 n/a n/a
to managed care entities (Table 10854).
17) (HCBS Payment Adequacy).
Sec. 441.303(f)(6), Sec. OMB 0938-TBD (CMS- 39 States............ 156 Varies.............. 1,599 Varies.............. 169,236 84,618 n/a
441.311(d)(1)--One-Time burden to 10854).
States (Table 18) (Supporting
Documentation for HCBS Access).
[[Page 28065]]
Sec. 441.303(f)(6), Sec. OMB 0938-TBD (CMS- 39 States............ 156 Varies.............. 585 Varies.............. 67,639 33,820 n/a
441.311(d)(1)--Ongoing burden to 10854).
States (Table 19) (Supporting
Documentation for HCBS Access).
Sec. 441.311(d)(2)(i) One-Time OMB 0938-TBD (CMS- 48 States............ 240 Varies.............. 6,000 Varies.............. 591,154 295,577 n/a
burden to States (Table 20) 10854).
(Additional HCBS Access
Reporting).
Sec. 441.311(d)(2)(i) Ongoing OMB 0938-TBD (CMS- 48 States............ 240 Varies.............. 2,160 Varies.............. 222,888 111,444 n/a
burden to States (Table 21) 10854).
(Additional HCBS Access
Reporting).
Sec. 441.311(d)(2)(i) One-Time OMB 0938-TBD (CMS- 161 MCEs............. 644 Varies.............. 9, 177 Varies.............. 918,479 n/a n/a
burden to managed care entities 10854).
(Table 22) (Additional HCBS
Access Reporting).
Sec. 441.311(d)(2)(i) Ongoing OMB 0938-TBD (CMS- 161 MCEs............. 644 Varies.............. 5,474 Varies.............. 558,303 n/a n/a
burden to managed care entities 10854).
(Table 23) (Additional HCBS
Access Reporting).
Sec. 441.311(b)(1) Ongoing OMB 0938-1362 (CMS- 48 States............ 96 Varies.............. 96 Varies.............. 7,976 3,988 n/a
burden to States (Table 24) 10692).
(Incident Management System
Assessment) \a\.
Removal of Current Form 372(S) OMB 0938-0272 (CMS- 48 States............ 253 (44)................ (11,132) 75.32............... (860,281) (430,140) n/a
Ongoing Reporting Information 372(S)).
Collection (Table 25).
Form 372(S) Reporting Requirement OMB 0938-TBD (CMS- 48 States............ 144 Varies.............. 2,640 Varies.............. 221,093 110,546 n/a
to include Proposed Sec. 10854).
441.311(b)(2)-(4) (Table 26).
Sec. 441.311(c) One-time burden OMB 0938-TBD (CMS- 48 States............ 288 Varies.............. 64,560 Varies.............. 5,141,918 2,570,959 n/a
to States (Table 27) (HCBS 10854).
Quality Measure Set).
Sec. 441.311(c) Ongoing burden OMB 0938-TBD (CMS- 24 States............ 288 Varies.............. 117,840 Varies.............. 4,087,183 2,043,592 n/a
to States (Table 28) (HCBS 10854).
Quality Measure Set) \b\.
Sec. 441.311(c) Ongoing burden OMB 0938-TBD (CMS- 48,000 beneficiaries. 24,000 0.75................ 18,000 20.71............... n/a n/a 372,780
to beneficiaries (Table 29) (HCBS 10854).
Quality Measure Set).
Sec. 441.313 One-time burden to OMB 0938-TBD (CMS- 48 States............ 192 Varies.............. 5,232 Varies.............. 517,633 258,816 n/a
States (Table 30) (Website 10854).
Transparency).
Sec. 441.313 Ongoing burden to OMB 0938-TBD (CMS- 48 States............ 768 Varies.............. 6,336 Varies.............. 666,228 333,114 n/a
States (Table 31) (Website 10854).
Transparency) \d\.
Removal of Sec. 447.203(b)(1)- OMB 0938-1134 (CMS- 51 States and 17 (310)............... (5,270) Varies.............. (446,593) (223,297) n/a
(6)(i)) (Table 32) (Removal of 10391). Territories.
AMRP).
Removal of Sec. OMB 0938-1134 (CMS- 51 States and 22 (67)................ (1,474) Varies.............. (143,411) (71,706) n/a
447.203(b)(6)(ii) (Table 32) 10391). Territories.
(Removal of AMRP).
Sec. 447.203(b)(1) (Table 33) OMB 0938-1134 (CMS- 51 States and 26 4................... 104 Varies.............. 7,712 3,856 n/a
(Rate transparency). 10391). Territories.
Sec. 447.203(b)(2) (Table 33) OMB 0938-1134 (CMS- 51 States and 26 79.................. 2,054 Varies.............. 174,206 87,103 n/a
(Rate analysis). 10391). Territories.
Sec. 447.203(b)(6) (Table 34) OMB 0938-1134 (CMS- 51 States and 26 7................... 182 Varies.............. 22,837 11,418 n/a
(advisory group). 10391). Territories.
Sec. 447.203(c)(1) (Table 35) OMB 0938-1134 (CMS- 51 States and 17 48.................. 816 Varies.............. 81,356 40,678 n/a
(initial State analysis). 10391). Territories.
[[Page 28066]]
Sec. 447.203(c)(2) (Table 36) OMB 0938-1134 (CMS- 51 States and 12 216................. 2,160 Varies.............. 185,432 92,716 n/a
(additional State analysis). 10391). Territories.
-------------------------------------------------------------------------------------------------------------------------------------------------------------
Total......................... ..................... Varies............... 478,858 Varies.............. 1,600,122 Varies.............. 279,404,181 82,205,315 504,180
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ The reporting requirement is every other year. Therefore, the on-going burden reflected in this table is half of the on-going burden per State reflected in Table 24.
\b\ The reporting requirement is every other year. Therefore, the on-going burden reflected in this table is half of the on-going burden per State reflected in Table 32.
\c\ The reporting requirement is every other year. Therefore, the on-going burden reflected in this table is half of the on-going burden per discussed above.
\d\ The reporting requirement is quarterly. Therefore, the on-going burden reflected in this table is four times the on-going burden discussed above.
E. Submission of PRA-Related Comments
We have submitted a copy of this proposed rule to OMB for its
review of the rule's information collection requirements. The
requirements are not effective until they have been approved by OMB.
To obtain copies of the supporting statement and any related forms
for the proposed collections discussed above, please visit the CMS
website at www.cms.hhs.gov/PaperworkReductionActof1995, or call the
Reports Clearance Office at 410-786-1326.
We invite public comments on these potential information collection
requirements. If you wish to comment, please submit your comments
electronically as specified in the DATES and ADDRESSES section of this
proposed rule and identify the rule (CMS-2442-P), the ICR's CFR
citation, and OMB control number.
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 Analysis
A. Statement of Need
1. Medicaid Advisory Committee
The changes to Sec. 431.12 are intended to provide beneficiaries a
greater voice in State Medicaid programs. In making policy and program
decisions, it is vital for States to incorporate the perspective and
experience of those served by the Medicaid program. States are
currently required to operate a MCAC, made up of health professionals,
consumers, and State representatives to ``advise the Medicaid agency
about health and medical care services.'' This rule establishes new
requirements for a MAC in place of the MCAC, with additional membership
requirements to include a broader group of interested parties, to
advise the State Medicaid agency on matters related to the effective
administration of the Medicaid program. We seek to expand the
viewpoints represented on the MAC, to provider States with richer
feedback on Medicaid program and policy issues. States are already
required to set up and use MCACs. The proposed changes will result in
the State also setting up a smaller group, the BAG which will likely
have a cost implication. The additional cost will depend on whether or
not States already have a beneficiary committee--we know that many
States already do. This smaller group which feeds into the larger MCAC
will benefit the Medicaid program by creating a forum for beneficiaries
to weigh in on key topics and share their unique views as Medicaid
program participants. The new provisions of Sec. 431.12 also enhance
transparency and accountability through public reporting requirements
related to the operation and activities of the MAC and BAG, and
guidelines for operation of both bodies.
2. Home and Community-Based Services (HCBS)
The proposed changes at part 441, subpart G, seek to amend and add
new Federal requirements, which are intended to improve access to care,
quality of care, and health outcomes, and strengthen necessary
safeguards that are in place to ensure health and welfare, and promote
health equity for people receiving Medicaid-covered HCBS. The
provisions in this proposed rule are intended to achieve a more
consistent and coordinated approach to the administration of policies
and procedures across Medicaid HCBS programs in accordance with section
2402(a) of the Affordable Care Act, and is made applicable to part 441,
subparts J, K, and M, as well as part 438 to achieve these goals.
Specifically, the proposed rule seeks to: strengthen person-
centered services planning and incident management systems in HCBS;
require minimum percentages of Medicaid payments for certain HCBS to be
spent on compensation for the direct care workforce; require States to
establish grievance systems in FFS HCBS programs; report on waiver
waiting lists in section 1915(c) waiver programs, service delivery
timeframes for certain HCBS, and a standardized set of HCBS quality
measures; and promote public transparency related to the administration
of Medicaid-covered HCBS through public reporting on measures related
to incident management systems, critical incidents, person-centered
planning, quality, access, and payment adequacy.
In 2014, we released guidance \263\ for section 1915(c) waiver
programs, which described a process in which States were to report on
State-developed performance measures to demonstrate that they meet the
six assurances that are required for section 1915(c) waiver programs.
Those six assurances include the following:
---------------------------------------------------------------------------
\263\ https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/3-cmcs-quality-memo-narrative_0_71.pdf.
---------------------------------------------------------------------------
1. Level of Care: The State demonstrates that it implements the
processes and instrument(s) specified in its approved waiver for
evaluating/reevaluating an applicant's/waiver participant's level of
care consistent with care provided in a hospital, nursing facility, or
Intermediate Care Facilities for Individuals with Intellectual
Disabilities.
2. Service Plan: The State demonstrates it has designed and
[[Page 28067]]
implemented an effective system for reviewing the adequacy of service
plans for waiver participants.
3. Qualified Providers: The State demonstrates that it has designed
and implemented an adequate system for assuring that all waiver
services are provided by qualified providers.
4. Health and Welfare: The State demonstrates it has designed and
implemented an effective system for assuring waiver participant health
and welfare.
5. Financial Accountability: The State demonstrates that it has
designed and implemented an adequate system for insuring financial
accountability of the waiver program.
6. Administrative Authority: The Medicaid Agency retains ultimate
administrative authority and responsibility for the operation of the
waiver program by exercising oversight of the performance of waiver
functions by other State and local/regional non-State agencies (if
appropriate) and contracted entities.
Despite these assurances, there is evidence that State HCBS systems
still need to be strengthened and that there are gaps in existing
reporting requirements. We believe that this proposed rule is necessary
to address these concerns and strengthen HCBS systems. The requirements
in this proposed rule are intended to supersede and fully replace the
reporting and performance expectations described in the 2014 guidance
for section 1915(c) waiver programs. They are also intended to promote
consistency and alignment across HCBS programs, as well as delivery
systems, by applying the requirements (where applicable) to sections
1915(i), (j), and (k) authorities State plan benefits and to both FFS
and managed care delivery systems.
3. Fee-for-Service (FFS)
Provisions under Sec. 447.203 from this proposed rule would impact
States' required documentation of compliance with section
1902(a)(30)(A) of the Act to ``assure that payments 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.'' We have received comments from State agencies that the existing
AMRP requirement first established by the 2015 final rule with comment
period imposes excessive administrative burden for its corresponding
value in demonstrating compliance with section 1902(a)(30)(A) of the
Act.
This proposed rule would replace the existing AMRP requirement with
a more limited payment rate transparency requirement under proposed
Sec. 447.203(b), while requiring a more detailed access impact
analysis (as described at proposed Sec. 447.203(c)(2)) when a State
proposes provider rate reductions or restructurings that exceed certain
thresholds for a streamlined analysis process under proposed Sec.
447.203(c)(1). By limiting the data collection and publication
requirements imposed on all States, while targeting certain provider
rate reductions or restructuring proposals for a more detailed
analysis, this proposed rule would provide administrative burden relief
to States while maintaining a transparent and data-driven process to
assure State compliance with section 1902(a)(30)(A) of the Act.
B. Overall Impact
We have examined the impacts of this rule as required by E.O. 12866
on Regulatory Planning and Review (September 30, 1993), E.O. 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 Act, section 202 of the Unfunded Mandates Reform
Act of 1995 (March 22, 1995; Pub. L. 104-4), E.O. 13132 on Federalism
(August 4, 1999), and the Congressional Review Act (5 U.S.C. 804(2))
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 as amended by Executive Order 14094
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 $200
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; (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 legal or policy issues for which
centralized review would meaningfully further the President's
priorities, or the principles set forth in the Executive Order.
A regulatory impact analysis (RIA) must be prepared for major
rules. Accordingly, this proposed rule is not a ``significant'' rule
under section 3(f)(1) of the Executive Order, as the aggregate amount
of benefits and costs will not meet the $200 million threshold in any 1
year.
Based on our estimates using a ``no action'' baseline in accordance
with OMB Circular A-4, (available at https://www.whitehouse.gov/wpcontent/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf), OMB's
Office of Information and Regulatory Affairs has determined that this
rulemaking is ``significant'' according to section 3(f)(4), raising
legal or policy issues for which centralized review would meaningfully
further the President's priorities, or the principles set forth in
Executive Order 12866. Therefore, OMB has reviewed these proposed
regulations, and the Departments have provided the following assessment
of their impact.
C. Detailed Economic Analysis
As mentioned in the prior section, and in accordance with OMB
Circular A-4, the following estimates were determined using a ``no
action'' baseline. That is, our analytical baseline for impact is a
direct comparison between the proposed provisions and not proposing
them at all.
1. Benefits
a. Medicaid Advisory Committees (MAC)
We believe the changes to Sec. 431.12 would benefit State Medicaid
programs and those they serve by ensuring that beneficiaries have a
significant role in advising States on the experience of receiving
health care and services through Medicaid. These benefits cannot be
quantified. However, the BAG and a more diverse and transparent MAC
will provide opportunities for richer interested parties feedback and
expertise to positively impact State decision making on Medicaid
program and policy chances. For example, beneficiary feedback on
accessing health care services and the quality of those services can
inform decisions on provider networks and networks adequacy
requirements. Issues that States need to address, like cultural
competency of providers, language accessibility, health equity, and
disparities and biases in the Medicaid program, can be revealed through
beneficiary experiences. The MAC falls into the Public Administration
921 Executive, Legislative, and Other General Government Support.
[[Page 28068]]
b. Person-Centered Service Plans, Grievance Systems, Incident
Management Systems
The proposed changes benefit Medicaid beneficiaries and States by
requiring States to demonstrate through reporting requirements that
they provide safeguards to assure eligibility for Medicaid-covered care
and services is determined and provided in a manner that is in the
Medicaid beneficiaries' best interest, although these potential
benefits cannot be monetarily quantified at this time. The proposed
changes would provide further safeguards that ensure health and welfare
by strengthening the person-centered service plan requirements,
establishing grievance systems, amending requirements for incident
management systems, and establishing new reporting requirements for
States, and contracted managed care entities identified by the North
American Industry Classification System (NAICS) industry code (Direct
Health and Medical Insurance Carriers (524114).
These changes would benefit individuals on HCBS waiver wait lists,
and individuals who receive homemaker, home health aide, and personal
care services, under the amended and proposed regulations found at
Sec. Sec. 441.301(c), 441.302(a)(6), 441.302(h), 441.303(f), 441.311,
and cross-referenced in Sec. Sec. 441.464, 441.555(b)(2)(iv), 441.570,
and 441.745(a)(1)(iii). These potential benefits cannot be monetarily
quantified at this time.
c. Home and Community-Based Services (HCBS) Payment Adequacy
The proposed rule adds new requirements at Sec. Sec. 441.302(k)
and 441.311 (cross-referenced at Sec. Sec. 441.464(f) and
441.745(a)(1)(vi)) that require States to demonstrate through reporting
that payments to providers are sufficient to provide access to care
that is at least comparable to that of the general population in the
same geographic location, in accordance with section 1902(a)(30(A) of
the Act. This proposed rule seeks to address access to care that is
being affected by direct care workforce shortages.
Through this proposed rule, which establishes certain minimum
thresholds for compensation for direct care workers, we can better
ensure payment adequacy to a provider population experiencing worker
shortages that impact beneficiary access. States will be required to
report annually to us on the percent of payments for certain HCBS that
are spent on compensation for direct care workers and will be required
to separately report on payments for services that are self-directed.
States may benefit from reporting in the aggregate for each service
subject to the requirement across HCBS programs and delivery systems,
which minimizes administrative burden while providing us better
oversight of compensation of the direct care workforce, although these
potential benefits cannot be monetarily quantified at this time due to
the variety of State data collection approaches.
d. Home and Community-Based Services (HCBS) Quality Measure Set
Reporting
As described in section II.B.8. of this proposed rule, on July 21,
2022, we issued State Medicaid Director Letter (SMDL) # 22-003 \264\ to
release the first official version of the HCBS Quality Measure Set.
This proposed rule provides definitions and sets forth requirements
proposed at Sec. 441.312 that expand on the HCBS Quality Measure Set
described in the SMDL. By expanding and codifying aspects of the SMDL,
we can better drive improvement in quality of care and health outcomes
for beneficiaries receiving HCBS. States will also benefit from the
clarity afforded by this proposed rule, and from the assurance that
other States they may be looking to for comparison are adhering to the
same requirements. The clarity and assurance, at this time, cannot be
measured.
---------------------------------------------------------------------------
\264\ https://www.medicaid.gov/federal-policy-guidance/downloads/smd22003.pdf.
---------------------------------------------------------------------------
e. Fee-for-Service (FFS) Payment Transparency
The proposed changes to Sec. 447.203 would update requirements
placed on States to document access to care and service payment rates.
The proposed updates create a systematic framework through which we can
ensure compliance with section 1902(a)(30)(A) of the Act, while
reducing existing burden on States and maximizing the value of their
efforts, as described in section III.C.11.a of this rule.
The proposed payment rate transparency provisions at Sec.
447.203(b) create a process that would facilitate transparent oversight
by us and other interested parties. By requiring States to calculate
Medicaid payment rates as a percent of corresponding Medicare payment
rates, this provision offers a uniform benchmark through which us and
interested parties can assess payment rate sufficiency. When compared
to the existing AMRP requirement, the rate analysis proposed by Sec.
447.203(b) should improve the utility of the reporting, while reducing
the associated administrative burden, as reflected in the Burden
Estimate Summary Table 37. Proposed updates at Sec. 447.203(c) specify
required documentation and analysis when States propose to reduce or
restructure provider payment rates. By establishing thresholds at Sec.
447.203(c)(1), this proposed rule would generally limit the more
extensive access review prescribed by Sec. 447.203(c)(2) to those SPAs
that we believe more likely to cause access concerns. In doing so,
these proposed updates reduce the State administrative burden imposed
by existing documentation requirements for proposed rate reductions or
restructurings, without impeding our ability to ensure proposed rate
reduction and restructuring SPAs comply with section 1902(a)(30)(A) of
the Act. These burden reductions are reflected in the Collection of
Information section of this rule.
When considering the benefits of these regulatory updates, we
considered the possibility that the improved transparency required by
Sec. 447.203(b) could create upward pressure on provider payment
rates, and that the tiered nature of documentation requirements set by
Sec. 447.203(c) could create an incentive for States to moderate
proposed payment reductions or restructurings that were near the
proposed thresholds that would trigger additional analysis and
documentation requirements. If either of these rate impacts were to
occur, existing literature implies there could be follow-on benefits to
Medicaid beneficiaries, including but not limited to increased
physician acceptance rates,\265\ increased appointment
availability,\266\ and even improved self-reported health.\267\
However, nothing in this proposed rulemaking would require States to
directly adjust payment rates, and we recognize that multiple factors
influence State rate-setting proposals, including State budgetary
pressures, legislative priorities, and other forces. These competing
influences create substantial uncertainty about the specific impact of
the proposed provisions at Sec. 447.203 on provider payment rate-
setting and beneficiary access. Rather, the specific intent and
anticipated outcome of these
[[Page 28069]]
provisions is the creation of a more uniform, transparent, and less
burdensome process through which States can conduct required payment
rate and access analyses and we can perform our oversight role related
to provider payment rate sufficiency.
---------------------------------------------------------------------------
\265\ Holgash, K. and Martha Heberlein, Health Affairs, April
10, 2019.
\266\ Candon, M., et al. JAMA Internal Medicine, January 2018,
p. 145-146.
\267\ Alexander, D., and Molly Schnell. ``The Impacts of
Physician Payments on Patient Access, Use, and Health'', National
Bureau of Economic Research, Working Paper 26095, July 2019 (revised
August 2020), p. 1-74. https://www.nber.org/papers/w26095. Accessed
June 16, 2022.
---------------------------------------------------------------------------
2. Costs
a. Medicaid Advisory Committee (MAC)
States will incur additional costs (estimated below) in appointing
and recruiting members to the MAC and BAG and also developing and
publishing bylaws, membership lists, and meeting minutes for the MAC
and BAG. All of these costs can be categorized under the NAICS Code 921
(Executive, Legislative, and Other General Government Support) since
States are the only entity accounted for in the MAC and BAG. How often
these costs occur will vary in how often the State chooses to make
changes such as add or replace members of the MAC and BAC or change its
bylaws. Additionally, there will be new costs, estimated below, for
States related to meeting logistics and administration for the BAG. All
of these new costs can also be categorized under the NAICS Code 921
(Executive, Legislative, and Other General Government Support). Since
most States are already holding MAC meetings under current regulatory
requirements, any new costs related to MAC requirements would likely be
minimal. In terms of the BAG meeting costs, we estimate a total annual
cost of $532,627 for States. We estimate it will take a business
operations specialist 10 hours to plan and execute each BAG meeting, at
a total cost of $155,448 ($76.20/hour x 10 hours x 4 meetings/year) x
51 States and the District of Columbia). To satisfy the requirements of
Sec. 431.12(i)(4)(i), a public relations specialist will spend an
estimated 80 hours/year supporting Medicaid beneficiary MAC and BAG
members at a total cost of $287,395 ($70.44/hour x 80 hours) x 51
States and the District of Columbia). A chief executive in State
government, as required by Sec. 431.12(i)(4)(iii), will spend a total
of 8 hours a year attending BAG meetings, which we estimate will be 2
hours in duration, 4 times a year at a total cost of $48,984 ($120.06/
hour x 2 hours/meeting x 4 meetings) x 51 States and the District of
Columbia). Each meeting of the BAG will cost States an estimated $200
in meeting costs and telecommunication, at an annual total cost of
$40,800 ($200 x 4 meetings) x 51 States and the District of Columbia).
There will also be a per meeting cost to States for financial
support for beneficiary members participating in MAC and BAG meetings,
as described in Sec. 431.12(i)(4)(ii). We estimate a cost of $75/
beneficiary/meeting in the form of transportation vouchers, childcare
reimbursement, meals, and/or other financial compensation. Assuming 4
meetings per year (with BAG and MAC meetings co-located and occurring
on the same day) and an average of 8 beneficiary members on the BAG and
MAC, the cost of financial support for beneficiary members across
States is estimated to cost approximately $122,400 annually (($75/
beneficiary x 8 beneficiaries x 4 meetings/year) x 51 States and the
District of Columbia). This cost will vary depending on the decisions
States make around financial support, the number of beneficiary members
of the BAG and MAC, and the number of meetings per year. We seek
comment on the costs associated with planning, execution, and
participation in the MAC and BAG meetings.
Table 38--Projected 5-Year Costs for Proposed Updates
--------------------------------------------------------------------------------------------------------------------------------------------------------
Calendar year (CY)
----------------------------------------------------------------------------------------------- Total CY 2024-
Provision 2024 ($ in 2025 ($ in 2026 ($ in 2027 ($ in 2028 ($ in 2028 ($ in
millions) millions) millions) millions) millions) millions)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec. 431.12 MAC & BAG logistic and 0.533 0.532 0.532 0.532 0.532 2.663
admin support........................
Sec. 431.12 Financial support to MAC/ 0.122 0.122 0.122 0.122 0.122 0.612
BAG beneficiary members (cost will
range per State).....................
-----------------------------------------------------------------------------------------------------------------
Total............................. 0.655 0.655 0.655 0.655 0.655 3.275
--------------------------------------------------------------------------------------------------------------------------------------------------------
Costs will vary depending by State depending on how many in person meetings are held and how many Medicaid beneficiaries are selected for the MAC and
BAG.
b. Home and Community-Based Services (HCBS)
Costs displayed in Table 38 are inclusive of both one-time and
ongoing costs. One-time costs are split evenly over the years leading
up to the proposed effective date. For example, if a proposed provision
takes effect 3 years after the final rule's publication, the one-time
costs would be split evenly across each of the years leading to that
effective date. Because costs are projected over 5 years, the total
estimated costs exceed the amounts shown in the COI section. The
estimates below do not account for higher costs associated with medical
care, as the costs are related exclusively to reporting costs. Costs to
States, the Federal government, and managed care entities do not
account for enrollment fluctuations, as they assume a stable number of
States operating HCBS programs and managed care entities delivering
services through these programs. Similarly, costs to providers and
beneficiaries do not account for enrollment fluctuations. In the COI
section, costs are based on a projected range of HCBS providers and
beneficiaries. Given this uncertainty, here, we based cost estimates on
the mid-point of the respective ranges and kept those assumptions
consistent over the course of the 5-year projection. Per OMB
guidelines, the projected estimates for future years do not consider
ordinary inflation.
Table 39 summarizes the estimated ongoing costs for States, managed
care entities (Direct Health and Medical Insurance Carriers (NAICS
524114)), and providers (Services for the Elderly and Persons with
Disabilities (NAICS 624120) and Home Health Care Services (NAICS
621610)) from the COI section of the HCBS provisions of the proposed
rule projected over 5 years. This comprises the entirety of anticipated
quantifiable costs associated with proposed changes to part 441,
subpart G. It is also possible that increasing the threshold from 86
percent to 90 percent for compliance reporting at Sec. 441.311(b)(2)
through (3) may lead to additional costs to remediate issues pertaining
to critical incidents or person-centered planning. However, the various
avenues through which States could address these concerns creates
substantial uncertainty as to what those costs may be. While we
acknowledge the potential for increased costs in a limited number of
States that may fall within the gap between the existing and
[[Page 28070]]
the proposed compliance thresholds, we do not quantify them here.
Table 39--Projected 5-Year Costs for Proposed Updates to 441 Subparts G, J, K, and M
--------------------------------------------------------------------------------------------------------------------------------------------------------
Calendar year (CY)
----------------------------------------------------------------------------------------------- Total CY 2024-
Provision 2024 ($ in 2025 ($ in 2026 ($ in 2027 ($ in 2028 ($ in 2028 ($ in
millions) millions) millions) millions) millions) millions)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Proposed Sec. 441.301(c)(3) (Person- 0.06 0.06 0.06 ................. ................. 0.18
Centered Service Plans)..............
Proposed Sec. 441.301(c)(7) 1.24 1.24 0.87 0.87 0.87 5.10
(Grievance Systems)..................
Proposed Sec. 441.302(a)(6) 41.15 41.15 41.15 6.78 6.78 137.01
(Incident Management System).........
Proposed Sec. 441.302(k) (HCBS 21.08 21.08 21.08 21.08 21.73 106.03
Payment Adequacy)....................
Proposed Sec. 441.303(f)(6), Sec. 0.06 0.06 0.06 0.07 0.07 0.30
441.311(d)(1) (Supporting
Documentation for HCBS Access).......
Proposed Sec. 441.311(d)(2)(i) 0.50 0.50 0.50 0.78 0.78 3.07
(Additional HCBS Access Reporting)...
Proposed Sec. 441.311(b)(1) ................. ................. ................. 0.00 0.00 0.01
(Incident Management System
Assessment)..........................
Removal of Current Form 372(S) Ongoing ................. ................. ................. (0.84) (0.84) (1.68)
Reporting Information Collection.....
Proposed Form 372(S) Reporting ................. ................. ................. 0.22 0.22 0.44
Requirement to include Proposed Sec.
441.311(b)(2)-(4)...................
Proposed Sec. 441.311(c) (HCBS 1.72 1.72 1.72 4.59 4.59 14.34
Quality Measure Set).................
Proposed Sec. 441.313 (Website ................. ................. ................. 1.18 1.18 2.37
Transparency)........................
-----------------------------------------------------------------------------------------------------------------
Total............................. 65.80 65.80 65.44 34.74 35.39 267.18
--------------------------------------------------------------------------------------------------------------------------------------------------------
The costs displayed in Table 40 are inclusive of costs anticipated
to be incurred by State Medicaid agencies, the Federal government,
providers, managed care entities, and beneficiaries. Table 40
distributes those costs across these respective entities.
Table 40--Projected Distribution of Costs for Proposed Updates to 42 CFR 441 Subpart G, J, K, and M
--------------------------------------------------------------------------------------------------------------------------------------------------------
Calendar year (CY)
Costs associated with updates to Sec. ----------------------------------------------------------------------------------------------- Total CY 2024-
42 CFR 441 Subparts G, J, K, and M 2024 ($ in 2025 ($ in 2026 ($ in 2027 ($ in 2028 ($ in 2028 ($ in
millions) millions) millions) millions) millions) millions)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Costs associated with updates to 65.80 65.80 65.44 34.74 35.39 267.18
42 CFR 441 subparts G, J, K, and M...
State Costs........................... 21.88 21.88 21.69 4.59 4.50 74.54
Federal Costs......................... 21.88 21.88 21.69 4.59 4.50 74.54
HCBS Provider Costs (Services for the 20.47 20.47 20.47 23.62 24.69 109.73
Elderly and Persons with Disabilities
(NAICS 624120) and Home Health Care
Services (NAICS 621610)).............
Managed Care Entity Costs (Direct 1.58 1.58 1.58 1.43 1.19 7.35
Health and Medical Insurance Carriers
(NAICS 524114))......................
--------------------------------------------------------------------------------------------------------------------------------------------------------
c. Fee-for-Service (FFS) Payment Rate Transparency
The costs associated with the payment rate transparency proposals
are wholly associated with information collection requirements, and as
such those impacts are reflected in the COI section of this rule. For
ease of reference, and for projection purposes, we are including those
costs here in Table 41.
Table 41--Projected 5-Year Costs for Proposed Updates to 42 CFR 447.203
--------------------------------------------------------------------------------------------------------------------------------------------------------
Calendar year (CY)
----------------------------------------------------------------------------------------------- Total CY 2024-
Provision 2024 ($ in 2025 ($ in 2026 ($ in 2027 ($ in 2028 ($ in 2028 ($ in
millions) millions) millions) millions) millions) millions)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Removal of current Sec. 447.203 -0.601 -0.601 -0.601 -0.601 -0.601 -3
(AMRPs)..............................
Proposed Sec. 447.203(b)............ 0.516 0.209 0.209 0.209 0.209 1.353
Proposed Sec. 447.203(c) (SPAs)..... 0.276 0.276 0.276 0.276 0.276 1.38
-----------------------------------------------------------------------------------------------------------------
Total............................. 0.191 -0.116 -0.116 -0.116 -0.116 -0.267
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 28071]]
Table 42--NAICS Classification of Services and Their Distribution of
Costs
------------------------------------------------------------------------
Percentage of
Services NAICS costs
(percent)
------------------------------------------------------------------------
Managed Care Entities.......... Direct Health and 100
Medical Insurance
Carriers (524114).
Home and Community-Based Elderly and Persons 67
Services (HCBS). with Disabilities
(624120).
Home and Community-Based Home Health Care 37
Services (HCBS). Services (621610).
------------------------------------------------------------------------
Table 43--One Time and Annual Costs Detailed
----------------------------------------------------------------------------------------------------------------
Cost to
Costs to Cost to managed One time Annual
Costs to beneficiaries providers care burden burden
states ($) ($) ($) entities overall overall
($) total ($) total ($)
----------------------------------------------------------------------------------------------------------------
Regulatory Review............... 19,587.06 39,174.12 ........... 61,833.66 120,594.84 0
Sec. 431.12 Medical Care 790,795 ............. ........... ........... ........... 790,795
Advisory Committee Requirements
Sec. 441.301(c)(3) (Person- 31,102 ............. ........... 120,463 151,565 ...........
Centered Service Plans) (Table
3,4)...........................
Sec. 441.301(c)(7) (Grievance 1,240,964 ............. ........... ........... 1,240,964 ...........
Systems) (Table 5).............
Sec. 441.301(c)(7) (Grievance 540,687 ............. ........... ........... ........... 540,687
Systems) (Table 6).............
Sec. 441.302(a)(6) (Incident 62,437,000 ............. ........... 2,576,084 65,009,084 ...........
Management System) (Table 7,10)
Sec. 441.302(a)(6) (Incident 12,366,317 ............. 3,141,193 503,633 ........... 16,011,132
Management System) (Table 8, 9,
10, 11)........................
Sec. 441.302(k) (HCBS Payment 458,347 ............. 103,451,453 1,486,877 105,396,677 ...........
Adequacy) (Table 12,14, 16)....
Sec. 441.302(k) (HCBS Payment 23,616 ............. 21,553,542 155,713 ........... 21,732,871
Adequacy) (Table 13,15, 17)....
Sec. 441.303(f)(6), Sec. 84,618 ............. ........... ........... 84,618 ...........
441.311(d)(1) Supporting
Documentation for HCBS Access
(Table 18).....................
Sec. 441.303(f)(6), Sec. 33,820 ............. ........... ........... ........... 33,820
441.311(d)(1) Supporting
Documentation for HCBS Access
(Table 19).....................
Sec. 441.311(d)(2)(i) (HCBS 295,577 ............. ........... 918,479 1,214,056 ...........
Access Reporting) (Table 20,
22)............................
Sec. 441.311(d)(2)(i) (HCBS 111,444 ............. ........... 558,303 ........... 669,747
Access Reporting) (Table 21,
23)............................
Sec. 441.311(b)(1) (Incident 3,988 ............. ........... ........... ........... 3,988
Management System Assessment)
(Table 24).....................
Removal of Current Form 372(S) ($430,140)) ............. ........... ........... ........... ($430,140)
Ongoing Reporting Information
Collection (Table 25)..........
Form 372(S) Reporting 110,546 ............. ........... ........... ........... 110,546
Requirement to include Proposed
Sec. 441.311(b)(2)-(4) (Table
26)............................
441.311(c) (Table 27) (HCBS 2,570,959 ............. ........... ........... 2,570,959 ...........
Quality Measure Set)...........
441.311(c) (Table 28,29) (HCBS 2,043,592 504,180 ........... ........... ........... 2,547,772
Quality Measure Set)...........
Sec. 441.313 (Table 30) 258,816 ............. ........... ........... 258,816 ...........
(Website Transparency).........
Sec. 441.313 (Table 31) 333,114 ............. ........... ........... ........... 333,114
(Website Transparency).........
Sec. 447.203(b)(1) (Table 33) 23,453 ............. ........... ........... 39,195 7,712
(Rate transparency)............
Sec. 447.203(b)(2) (Table 33) 87,103 ............. ........... ........... ........... 174,206
(Rate analysis)................
Sec. 447.203(b)(6) (Table 34) 145,386 ............. ........... ........... 267,934 22,837
(advisory group)...............
Sec. 447.203(c)(1) (Table 35) 40,678 ............. ........... ........... ........... 81,356
(initial State analysis).......
Sec. 447.203(c)(2) (Table 36) 92,716 ............. ........... ........... ........... 185,432
(additional State analysis)....
----------------------------------------------------------------------------------------------------------------
3. Transfers
Transfers are payments between persons or groups that do not affect
the total resources available to society. They are a benefit to
recipients and a cost to payers, with zero net effects. Because this
rule proposes changes to requirements to State agencies without changes
to payments from Federal to State governments, the transfer impact is
null, and cost impacts are reflected in the other sections of this
rule.
4. Regulatory Review Cost Estimation
If regulations impose administrative costs on private entities,
such as the time needed to read and interpret this proposed or final
rule, we should estimate the cost associated with regulatory review.
There is uncertainty involved with accurately quantifying the number of
entities that will review the rule. However, for the purposes of this
proposed rule we assume that on average, each of the 51 affected State
Medicaid agencies will have one contractor per State review this
proposed rule. This average assumes that some State Medicaid agencies
may use the same contractor, others may use multiple contractors to
address the various provisions within this proposed rule, and some
State Medicaid agencies may perform the review in-house. We also assume
that each affected managed care entity (estimated in the COI section to
be 161 managed care entities) will review the proposed rule. Lastly, we
assume that an average of two advocacy or interest group
representatives from each State will review this proposed rule. In
total, we are estimating that 314 entities (51 State Contractors + 161
Managed Care Entities + 102 Advocacy and Interest Groups) will review
this proposed rule. We acknowledge that this assumption may understate
or overstate the costs of reviewing this rule. We welcome any comments
on the approach in estimating the number of entities which will review
this proposed rule.
We also recognize that different types of entities are in many
cases affected by mutually exclusive sections of this proposed rule,
and therefore for the purposes of our estimate we assume that each
reviewer reads approximately 50 percent of the rule. We seek comments
on this assumption.
Using the wage information from the Bureau of Labor Statistics,
https://www.bls.gov/oes/current/oes_nat.htm, we consider medical and
health service managers (Code 11-9111), as including the 51 State
Contractors, 161 Managed Care Entities and 102 Advocacy and Interest
Groups identified in the proposed rule, and we estimate that the cost
of reviewing this rule is $115.22 per hour, including fringe benefits
and other indirect costs. Assuming an average reading speed of 250
words per minute, we estimate that it would take approximately 3.33
hours for each individual to review half of this proposed rule
([100,000 words x 0.5]/250 words per minute/60 minutes per hour). For
each entity that reviews the rule, the estimated cost is $384.06 (3.33
hours x $115.22). Therefore, we estimate
[[Page 28072]]
that the total one-time cost of reviewing this regulation is
$120,594.84 ($384.06 per individual review x 314 reviewers).
D. Alternatives Considered
1. Medicaid Advisory Committee (MAC)
In determining the best way to promote beneficiary and interested
parties' voices in State Medicaid program decision making and
administration, we considered several ways of revising the MCAC
structure and administration. We considered setting minimum benchmarks
for each category of all types of MAC members, but we viewed it as too
restrictive. We ultimately concluded that only setting minimum
benchmarks (at least 25 percent) for beneficiary representation on the
MAC and requiring representation from the other MAC categories would
give States maximum flexibility in determining the exact composition of
their MAC. However, we understand that some States may want us to set
specific thresholds for each MAC category rather than determine those
categories on their own.
We also considered having not having a separate BAG, but we
ultimately determined that requiring States to establish a separate BAG
assures that there is a dedicated forum for States to receive
beneficiary input outside of the MAC. In the MAC setting, a beneficiary
might not feel as comfortable speaking up among other Medicaid program
interested parties. The BAG also provides an opportunity for
beneficiaries to focus on the issues that are most important to them,
and bring those issues to the MAC.
Finally, we also considered setting specific topics for the MAC to
provide feedback. However, due to the range of issues specific to each
State's Medicaid program, we determined it was most conducive to allow
States work with their MAC to identify which topics and priority issues
would benefit from interested parties' input.
2. Home and Community-Based Services (HCBS)
a. Person-Centered Service Plans, Grievance Systems, Incident
Management Systems
We considered whether to codify the existing 86 percent performance
level that was outlined in the 2014 guidance for both person-centered
service plans and incident management systems. We did not choose this
alternative due to feedback from States and other interested parties of
the importance of these requirements, as well as concerns that an 86
percent performance level may not be sufficient to demonstrate that a
State has met the requirements.
We considered whether to apply these requirements to section
1905(a) ``medical assistance'' State Plan personal care, home health,
and case management services. We decided against this alternative based
on State feedback that they do not have the same data collection and
reporting capabilities for these services as they do for HCBS delivered
under sections 1915(c), (i), (j), and (k) of the Act and because of
differences between the requirements of those authorities and section
1905(a) State Plan benefits.
Finally, we considered allowing a good cause exception to the
minimum performance level reporting requirements to both the person-
centered service plan and the incident management system. We decided
against this alternative because the 90 percent performance level is
intended to account for various scenarios that might impact a State's
ability to achieve these performance levels. Furthermore, there are
existing disaster authorities that States could utilize to request a
waiver of these requirements in the event of a public health emergency
or a disaster.
b. HCBS Payment Adequacy
We considered several alternatives to the proposed rule. We
considered whether the requirements relating to the percent of payments
going to the direct care workforce should apply to other services, such
as adult day health, habilitation, day treatment or other partial
hospitalization services, psychosocial rehabilitation services, and
clinic services for individuals with mental illness. We decided against
this alternative because the proposed services (homemaker, home health
aide, and personal care) are those for which the vast majority of
payment should be comprised of compensation for direct care workers and
for which there would be low facility or other indirect costs. We also
did not include other services for which the percentage might be
variable due to the diversity of services included or for which worker
compensation would be reasonably expected to comprise only a small
percentage of the payment.
We considered whether to apply these payment adequacy requirements
to section 1905(a) ``medical assistance'' State Plan personal care and
home health services, but decided not to, based on State feedback that
they do not have the same data collection and reporting capabilities
for these services as they do for sections 1915(c), (i), (j), and (k)
HCBS.
We considered whether other reporting requirements such as a State
assurance or attestation or an alternative frequency of reporting could
be used to determine State compliance but determined that the proposed
requirement is necessary to demonstrate compliance.
We considered whether to require reporting at the delivery system,
HCBS waiver program, or population level but decided against additional
levels of reporting because it would increase reporting burden for
States without providing additional information necessary for
determining whether States meet the requirements at Sec. 441.302(k).
c. Supporting Documentation Requirements
No alternatives were considered.
d. HCBS Quality Measure Set Reporting
We considered giving States the flexibility to choose which
measures they would stratify and by what factors but decided against
this alternative as discussed in the Mandatory Medicaid and CHIP Core
Set Reporting proposed rule (see 87 FR 51313). We believe that
consistent measurement of differences in health outcomes between
different groups of beneficiaries is essential to identifying areas for
intervention and evaluation of those interventions.\268\ Consistency
could not be achieved if each State made its own decisions about which
data, it would stratify and by what factors.
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\268\ Schlotthauer AE, Badler A, Cook SC, Perez DJ, Chin MH.
Evaluating Interventions to Reduce Health Care Disparities: An RWJF
Program. Health Aff (Millwood). 2008;27(2):568-573.
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3. Payment Rate Transparency
In developing this proposed rule, we considered multiple
alternatives. We considered not proposing this rule and maintaining the
status quo under current regulations at Sec. 447.203 and 204. However,
as noted throughout the Background and Provisions sections of this
rule, since the 2011 proposed rule, we have received concerns from
interested parties, including State agencies, about the administrative
burden of completing AMRPs and questioning whether they are the most
efficient way to determine access to care. These comments expressed
particular concern about the AMRPs' value when they are required to
accompany a proposed nominal rate reduction or restructuring, or where
proposed rate changes are made via application of a previously approved
rate methodology. At the same time, and as we have discussed, the
Supreme
[[Page 28073]]
Court's 2015 decision in Armstrong v. Exceptional Child Care, Inc., 135
S. Ct. 1378 (2015) ruled that Medicaid providers and beneficiaries do
not have private right of action to challenge State-determined Medicaid
payment rates in Federal courts. This decision emphasized a greater
importance on our administrative review of SPAs proposing to reduce or
restructure payment rates. For both of these reasons, this proposed
rule includes proposals that would create an alternative process that
both reduces the administrative burden on States and standardizes and
strengthens our review of proposed payment rate reductions or payment
restructurings to ensure compliance with section 1902(a)(30)(A) of the
Act.
We considered, but did not propose, adopting a complaint-driven
process or developing a Federal review process for assessing access to
care concerns. Although such processes could further our goals of
ensuring compliance with the access requirement in section
1902(a)(30)(A) of the Act, we concluded similar effects could be
achieved through methods that did not require the significant amount of
Federal effort that would be necessary to develop either or both of
these processes. Additionally, a complaint-driven process would not
necessarily ensure a balanced review of State-proposed payment rate or
payment structure changes, and it is possible that a large volume of
complaints could be submitted with the intended or unintended effect of
hampering State Medicaid program operations. Therefore, the impact of
adopting a complaint-driven process or developing a Federal review
process for assessing access to care concerns may be negligible given
existing processes. Instead, we believe that relying on existing
processes that States are already engaged in, such as the ongoing
provider and beneficiary feedback channels under paragraph (b)(7) in
Sec. 447.203 and the public process requirement for States submitting
a SPA that proposed to reduce or restructure Medicaid service payments
in Sec. 447.204, would be more effective than creating a new process.
While we are relying on existing public feedback channels and processes
that States are already engaged in, we are seeking public comment
regarding our alternative consideration to propose adopting a complaint
driven process or developing a Federal review process for assessing
access to care concerns.
We considered finalizing the 2018 proposed rule that would have
provided exemptions to the AMRP process for States with high managed
care penetration or finalizing the 2019 proposed rule that would have
rescinded the AMRP requirements without substantive replacement. As
described in the 2018 proposed rule, while we agreed that our
experience implementing the AMRP process from the 2015 final rule with
comment period raised questions about the benefit of the access
analysis when States proposed nominal payment rate reductions or
payment restructurings that were unlikely to result in diminished
access to care, we did not believe maintaining the AMRP process was the
best course of action.\269\ Additionally, after proposing to rescind
the AMRP requirements through the 2019 proposed rule and issuing a CMCS
Informational Bulletin about an agency wide effort to establish a new,
comprehensive access strategy, we decided not to rescind the AMRP
requirements without another regulation in place to codify the
requirements for State compliance with section 1902(a)(30)(A) of the
Act given our oversight responsibility. While we have already received
and reviewed public comments received on the 2018 proposed rule or the
2019 proposed rule, we are seeking any additional public comments that
were not already captured during the comment periods of the 2018
proposed rule or 2019 proposed rule with regard to finalizing these
rules as an alternative considered within this proposed rulemaking.
---------------------------------------------------------------------------
\269\ 83 FR 12696 at 12697.
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We considered numerous variations of the individual provisions of
this proposed rule. We considered, but did not propose, maintaining the
benefits outlined in the current Sec. 447.203(b)(5)(ii)(A) through (H)
or requiring all mandatory Medicaid benefit categories be included in
the comparative payment rate analysis proposed under Sec.
447.203(b)(2). We also considered, but did not propose, including
inpatient hospital behavioral health services and covered outpatient
drugs including professional dispensing fees as additional categories
of services subject to the comparative payment rate analysis proposed
under Sec. 447.203(b)(2). We considered, but did not propose,
requiring States whose Medicaid payment rates vary by provider type,
calculate an average Medicaid payment rate of all providers for each E/
M CPT code subject to the comparative payment rate analysis. We also
considered, but did not propose, different points of comparison other
than Medicare under the comparative payment rate analysis proposed
under Sec. 447.203(b)(2) or using a peer payment rate benchmarking
approach for benefit categories where Medicaid is the only or primary
payer, or there is no comparable Medicare rate under the comparative
payment rate analysis proposed under Sec. 447.203(b)(2) and (3). We
considered, but did not propose, varying timeframes for the comparative
payment rate analysis proposed under Sec. 447.203(b)(2). We also
considered not proposing the payment rate transparency aspect of this
rule proposed under Sec. 447.203(b)(1), leaving the comparative
payment rate analysis to replace the AMRP process as proposed under
Sec. 447.203(b)(2). With regard to the proposal in Sec. 447.203(c),
we considered, but did not propose, establishing alternative
circumstances from those described in the 2017 SMDL for identifying
nominal payment rate adjustments, establishing a minimum set of
required data for States above 80 percent of the most recent Medicare
payment rates after the proposed reduction or restructuring, using
measures that are different from the proposed measures that would be
reflected in the forthcoming template, allowing States to use their own
unstructured data for States that fail to meet all three criteria in
Sec. 447.203(c)(1), and CMS producing and publishing the comparative
payment rate analysis proposed in Sec. 447.203(b).
We considered, but did not propose, maintaining the benefits
outlined in the current Sec. 447.203(b)(5)(ii)(A) through (H) or
requiring all mandatory Medicaid benefit categories be included in the
comparative payment rate analysis proposed under Sec. 447.203(b)(2).
Maintaining the benefits in current Sec. 447.203(b)(5)(ii)(A) through
(H) would have simplified the transition from the AMRP process to the
payment rate transparency and comparative payment rate analysis
requirements, if this proposed rule is finalized. However, our
experience implementing the 2015 final rule with comment period, as
well as interested parties' and States' feedback about the AMRP
process, encouraged us to review and reconsider the current list of
benefits subject to the AMRP process under current regulations Sec.
447.203(b)(5)(ii)(A) through (H) to determine where we could decrease
the level of effort required from States while still allowing ourselves
an opportunity to review for access concerns. During our review of the
current list of benefits under Sec. 447.203(b)(5)(ii)(A) through (H),
we considered, but did not propose, requiring all mandatory Medicaid
benefit categories be included in the comparative payment rate
analysis.
[[Page 28074]]
However, when considering the existing burden of the AMRP process under
current Sec. 447.203)(b), we believed that expanding the list of
benefits to include under proposed Sec. 447.203(b) and (c) would not
support our goal to develop a new access strategy that aims to balance
Federal and State administrative burden with our shared obligation to
ensure compliance with section 1902(a)(30)(A) of the Act. As previously
noted section II. of this rule, we are seeking public comment on
primary care services, obstetrical and gynecological services,
outpatient behavioral health services, and personal care, home health
aide, and homemaker services provided by individual providers and
providers employed by an agency as the proposed categories of services
subject to the comparative payment rate analysis requirements in
proposed Sec. 447.203(b)(2)(i). Additionally, we are seeking public
comment regarding our alternative consideration to propose maintaining
the benefits outlined in the current Sec. 447.203(b)(5)(ii)(A) through
(H) or propose requiring all mandatory Medicaid benefit categories.
We also considered, but did not propose, including inpatient
hospital behavioral health services and covered outpatient drugs
including professional dispensing fees as additional categories of
services subject to the comparative payment rate analysis proposed
under Sec. 447.203(b)(2). As previously described in section II. Of
this proposed rule, we did not propose including inpatient behavioral
health services as an additional category of service in the comparative
payment rate analysis due to existing UPL and CAA payment data
requirements for institutional services. The impact of including
inpatient behavioral health services in the comparative payment rate
analysis would have required duplicative effort by States to report the
same information in a different format to us. Additionally, we
considered, but did not propose, including covered outpatient drugs
(including professional dispensing fees) as an additional category of
service in the comparative payment rate analysis due to the complexity
of drug pricing policies and use of rebate programs that does not fit
into our proposed comparative payment rate analysis methodology that
relies on E/M CPT/HCPCS codes to identify the services subject to the
analysis.\270\ The impact of including covered outpatient drugs
(including professional dispensing fees) in the comparative payment
rate analysis would have resulted in us proposing an entirely different
process, in addition to the comparative payment rate analysis, for
States to follow which would create additional burden on States to
comply with. However, we are still seeking public comment regarding our
decision not to include inpatient behavioral health services and
covered outpatient drugs including professional dispensing fees as
additional proposed categories of services subject to the comparative
payment rate analysis requirements in proposed Sec. 447.203(b)(2).
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\270\ https://www.kff.org/medicaid/issue-brief/pricing-and-payment-for-medicaid-prescription-drugs/.
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We considered, but did not propose, requiring States whose Medicaid
payment rates vary by provider type to calculate an average Medicaid
payment rate of all provider types for each E/M CPT code subject to the
comparative payment rate analysis. Rather than proposing States
distinguish their Medicaid payment rates by each provider type in the
comparative payment rate analysis, we considered proposing States
calculate an average Medicaid payment rate of all providers for each E/
M CPT code. This consideration would have simplified the comparative
payment rate analysis because States would include a single, average
Medicaid payment rate amount and only need to separately analyze their
Medicaid payment rates for services delivered to pediatric and adult
populations, if they varied. However, calculating an average for the
Medicaid payment rate has limitations, including sensitivity to extreme
values and inconsistent characterizations of the payment rate between
Medicaid and Medicare. In this rule, we propose to characterize the
Medicare payment rate as the non-facility payment rate listed on the
Medicare PFS for the E/M CPT/HCPCS codes subject to the comparative
payment rate analysis. If we were to propose the Medicaid payment rate
be calculated as an average Medicaid payment rate of all provider types
for the same E/M CPT/HCPCS code, then States' calculated average
Medicaid payment rate could include a wide variety of provider types,
from a single payment rate for physicians to an average of three
payment rates for physicians, physician assistants, and nurse
practitioners. This wide variation in how the Medicaid payment rate is
calculated among States would provide a less meaningful comparative
payment rate analysis to Medicare. The extremes and outliers that would
be diluted by using an average are not necessarily the same for both
Medicaid and Medicare, so even if both sides of the comparison used an
average, we would not be able to look more closely at specific large
differences between the respective rates. As previously noted in
section II. of this proposed rule, we are seeking public comment on the
proposed characterization of the Medicaid payment rate, which accounts
for variation in payment rates for pediatric and adult populations and
distinguishes payment rates by provider type, in the comparative
payment rate analysis. Additionally, we are seeking public comment
regarding our alternative consideration to propose requiring States
whose Medicaid payment rates vary by provider type to calculate an
average Medicaid payment rate of all provider types for each E/M CPT
code subject to the comparative payment rate analysis.
We considered, but did not propose, requiring States to use a
different point of comparison, other than Medicare, for certain
services where Medicare is not a consistent or primary payer, such as
pediatric dental services or HCBS. The impact of requiring a different
point of comparison, other than Medicare, would have carried forward
the current regulation requiring States to ``include an analysis of the
percentage comparison of Medicaid payment rates to other public
(including, as practical, Medicaid managed care rates) and private
health insurer payment rates within geographic areas of the State'' in
their AMRPs. As previously discussed in this rule, FFS States expressed
concerns following the 2015 final rule with comment period that private
payer payment rates were proprietary information and not available to
them, therefore, the challenges to comply with current regulations
would be carried forward into the proposed rule. Therefore, we also
considered, but did not propose, using various payment rate
benchmarking approaches for benefit categories where Medicaid is the
only or primary payer, or there is no comparable Medicare rate. As
previously noted in section II. of this proposed rule, we considered
benchmarks based on national Medicaid payment averages for certain
services included within the LTSS benefit category, benchmarks that use
average daily rates for certain HCBS that can be compared to other
State Medicaid programs, and benchmarks that use payment data specific
to the State's Medicaid program for similarly situated services so that
the service payments may be benchmarked to national average.
Notwithstanding the previously described limitations of the alternative
considered for situations where
[[Page 28075]]
differences between Medicaid and Medicare coverage and payment exists,
we are seeking public comment regarding our alternative consideration
to propose States use a different point of comparison, other than
Medicare, for certain services where Medicare is not a consistent or
primary payer or States use a payment rate benchmarking approach for
benefit categories where Medicaid is the only or primary payer, or
there is no comparable Medicare rate. Specifically, we are seeking
public comment on the feasibility and burden on States to implement
these alternatives considered for the proposed comparative payment rate
analysis. For any comparison to other State Medicaid programs or to a
national benchmark, we also are seeking public comment on the
appropriate role for such a comparison in the context of the statutory
requirement to consider beneficiary access relative to the general
population in the geographic area.
We considered, but did not propose, various timeframes for the
comparative payment rate analysis, including annual (every year),
triennial (every 3 years), or quinquennial (every 5 years) updates
after the initial effective date of January 1, 2026. As noted in
section II. of this proposed rule, we did not propose an annual
timeframe as we felt that an annual update requirement was too frequent
due to many State's biennial legislative sessions that provide the
Medicaid agency with authority it make Medicaid payment rate changes as
well as create more or maintain a similar level of administrative
burden of the AMRPs. While some States do have annual legislative
sessions and may have annual Medicaid payment rate changes, we felt
that proposing annual updates solely for the purpose of capturing
payment rate changes in States that with annual legislative sessions
would be overly burdensome and duplicative for States with biennial
legislative sessions who do not have new, updated Medicaid payment
rates to update in their comparative payment rate analysis. Therefore,
for numerous States with biennial legislative sessions, the resulting
analysis would likely not vary significantly from year to year.
Additionally, the comparative payment rate analysis proposes to use the
most recently published Medicare payment rates and we are cognizant
that Medicare payment rate updates often occur on a quarterly basis.
While Medicare often increases rates by the market basket inflation
amount, as well as through rulemaking, it does not always result in
payment increases for providers.271 272 We also considered,
but did not propose, maintaining the triennial (every 3 years)
timeframe currently in regulation, because we thought it necessary to
make significant changes to the non-SPA-related reported in Sec.
447.203(b) that would represent a significant departure from the
initial AMRP process in the 2015 final rule with comment in the current
Sec. 447.203(b)(1) and this new proposed approach did not lend itself
to the triennial timeframe of the current AMRP process. Lastly, we
considered, but did not propose, the comparative payment rate analysis
be published on a quinquennial basis (every 5 years), because this
timeframe was too infrequent for the comparative payment rate analysis
to provide meaningful, actionable information. As previously noted in
section II. of this rule, we are seeking public comment on the proposed
timeframe for the initial publication and biennial update requirements
of the comparative payment rate analysis as proposed in Sec.
447.203(b)(4). Additionally, we are seeking public comment regarding
our alternative consideration to propose an annual, triennial, or
quinquennial timeframe for the updating the comparative payment rate
analysis after the initial effective date.
---------------------------------------------------------------------------
\271\ Although ``market basket'' technically describes the mix
of goods and services used in providing health care, this term is
also commonly used to denote the input price index (that is, cost
category weights and price proxies combined) derived from that
market basket. Accordingly, the term ``market basket'' as used in
this document refers to the various CMS input price indexes. A CMS
market basket is described as a fixed-weight, Laspeyres-type index
because it measures the change in price, over time, of the same mix
of goods and services purchased in the base period. FAQ--Medicare
Market Basket Definitions and General Information, updated May 2022.
https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/MedicareProgramRatesStats/Downloads/info.pdf
Accessed January 4, 2023.
\272\ Medicare Unit Cost Increases Reported as of April 2022.
https://www.cms.gov/files/document/ffs-trends-2021-2023-april-2022.pdf. Accessed January 4, 2023.
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We considered, but did not propose, requiring the comparative
payment rate analysis be submitted directly to us, as this would not
achieve the public transparency goal of the proposed rule. As proposed
in Sec. 447.203(b)(3), we are requiring States develop and publish
their Medicaid comparative payment rate analysis on the State's website
in an accessible and easily understandable format. This proposal is
methodologically similar to the current regulation, which requires
AMRPs be submitted to us and publicly published by the State and CMS.
We found this aspect of the rule to be an effective method of publicly
sharing access to care information, as well as ensuring State
compliance. As previously noted in section II. of this proposed rule,
we are seeking public comment on the proposed requirement for States to
publish their Medicaid FFS payment rates for all services and
comparative payment rate analysis and payment rate disclosure
information on the State's website under the proposed Sec.
447.203(b)(1) and (3), respectively. Additionally, we are seeking
public comment regarding our alternative consideration to propose
requiring the comparative payment rate analysis be submitted directly
to us and not publicly published.
We considered, but did not propose, that we produce and publish the
comparative payment rate analysis proposed in Sec. 447.203(b)(2)
through (3) whereby we would develop reports for all States
demonstrating Medicaid payment rates for all services or a subset for
Medicaid services as a percentage of Medicare payment rates. Shifting
responsibility for this analysis would remove some burden from States
and allow us to do a full cross-comparison of State Medicaid payment
rates to Medicare payment rates, while ensuring a consistent rate
analysis across States. However, this approach would rely on T-MSIS
data, which would increase the lag in available data due to the need
for CMS to prepare it, and introduce uncertainty into the results due
to ongoing variation in State T-MSIS data quality and completeness.
Although our proposed approach still relies on State-supplied data,
they are able to perform the comparisons on their own regardless of the
readiness and compliance of any other State. Furthermore, we would need
to validate its results with States and work through any discrepancies.
Ultimately, we determined the increased lag time and uncertainty in
results would diminish the utility of the rate analyses proposed in
Sec. 447.203(b), if performed by us instead of the States, to support
our oversight of State compliance with section 1902(a)(30)(A) of the
Act. As previously noted in section II. of this rule, we are seeking
public comment on our proposal to require States to develop and publish
a comparative payment rate analysis and payment rate disclosure as
proposed in Sec. 447.203(b)(2) and (3). Additionally, we are seeking
public comment regarding our alternative consideration to propose that
we produce and publish the comparative payment rate analysis and
payment rate disclosure proposed in Sec. 447.203(b)(2) and (3) for all
States.
[[Page 28076]]
We considered, but did not propose, establishing alternative
circumstances from the 2017 SMDL for identifying nominal payment rate
adjustments when States propose a rate reduction or restructuring. We
previously outlined in SMDL #17-004 several circumstances where
Medicaid payment rate reductions generally would not be expected to
diminish access: reductions necessary to implement CMS Federal Medicaid
payment requirements; reductions that will be implemented as a decrease
to all codes within a service category or targeted to certain codes,
but for services where the payment rates continue to be at or above
Medicare and/or average commercial rates; and reductions that result
from changes implemented through the Medicare program, where a State's
service payment methodology adheres to the Medicare methodology. This
proposed rule would not codify this list of policies that may produce
payment rate reductions unlikely to diminish access to Medicaid-covered
services. We considered, but did not propose, setting a different
percentage for the criteria that State Medicaid rates for each benefit
category affected by the reductions or restructurings must, in the
aggregate, be at or above 80 percent of the most recent comparable
Medicare payment rates after the proposed reduction or restructuring as
a threshold. We considered setting the threshold at 100 percent of
Medicare to remain consistent with the 2017 SMDL. However, after
conducting a literature review, we determined that 80 percent of the
most recently published Medicare payment rates is currently the most
reliable benchmark of whether a rate reduction or restructuring is
likely to diminish access to care. We also considered, but did not
propose, setting a different percentage for the criteria that proposed
reductions or restructurings result in no more than 4 percent reduction
of overall FFS Medicaid expenditures for a benefit category. We
considered a variety of percentages, but determined that codifying the
4 percent threshold from the 2017 SMDL and proposed in the 2018
proposed rule \273\ was the best option based on our experience
implementing this established policy after the publication of the 2017
SMDL. Additionally, we received a significant number of comments in the
2018 proposed rule from State Medicaid agencies that signaled strong
support for this percentage threshold as a meaningful threshold for
future rate changes.274 275 276 Lastly, we considered, but
did not propose, defining what is meant by ``significant'' access
concerns received through the public process described in Sec. 447.204
when a State proposes a rate reduction or restructuring. As proposed,
we expect State Medicaid agencies to make reasonable determinations
about which access concerns are significant when raised through the
public process, and as part of our SPA review, may request additional
information from the State to better understand any access concerns
that have been raised through public processes and whether they are
significant. Based on our experience implementing the policies outlined
in the 2017 SMDL and a literature review of relevant research about
payment rate sufficiency, we proposed criteria for States proposing
rate reductions or restructurings that would reduce the SPA submission
requirements when those criteria are met. Additionally, each of these
thresholds is one of a three-part test where States must meet all
three, or else it will trigger a requirement for additional State
analysis of the rate reduction or restructuring. As previously noted in
section II. of this rule, we are seeking public comment on the
streamlined criteria proposed in Sec. 447.203(c)(1). Additionally, we
are seeking public comment regarding our alternative consideration to
propose establishing alternative circumstances from the 2017 SMDL for
identifying nominal payment rate adjustments when States propose a rate
reduction or restructuring.
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\273\ 83 FR 12696 at 12705.
\274\ Connecticut Department of Social Services, Comment Letter
on 2018 Proposed Rule (May 21, 2018), https://downloads.regulations.gov/CMS-2018-0031-0021/attachment_1.pdf.
\275\ California Department of Health Care Services, Comment
Letter on 2018 Proposed Rule (May 24, 2018), https://downloads.regulations.gov/CMS-2018-0031-0090/attachment_1.pdf.
\276\ Florida Agency for Health Care Administration, Comment
Letter on 2018 Proposed Rule (May 24, 2018), https://downloads.regulations.gov/CMS-2018-0031-0083/attachment_1.pdf.
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We considered, but did not propose, establishing a minimum set of
required data for States above 80 percent of the most recent Medicare
payment rates after the proposed reduction or restructuring regardless
of the remaining criteria. This requirement would minimize
administrative burden on States by not requiring States submit all
items in Sec. 447.203(c)(2) and establish a baseline for comparison if
future rate reductions or restructurings are proposed that may lower
the State's payment rates below 80 percent of the most recent Medicare
payment rates. However, we determined that, while we believe 80 percent
to be an effective threshold point, we did not want that to serve as
the only trigger for additional analysis. As proposed, only States that
do not meet all of the proposed requirements in Sec. 447.203(c)(1)
will have to submit the required data outlined in Sec. 447.203(c)(2).
As previously noted in section II. of this rule, we are seeking public
comment on our proposal to require all three criteria described in
Sec. 447.203(c)(1)(i) through (iii) for assessing the effect of a
proposed payment rate reduction or payment restructuring on access to
care. Additionally, we are seeking public comment regarding our
alternative consideration to propose establishing alternative
circumstances from the 2017 SMDL for identifying nominal payment rate
adjustments when States propose a rate reduction or restructuring.
We considered, but did not propose, allowing States to use their
own unstructured data, similar to the AMRP process, for States that
fail to meet all three criteria in Sec. 447.203(c)(1), thereby
eliminating the need for us to develop a template for States proposing
rate reductions or restructurings. While this would reduce
administrative burden on us and provide States with flexibility in
determining relevant data for complying with statutory and regulatory
requirements, we received feedback after the 2015 final rule with
comment period that States found developing an AMRP from scratch with
minimal Federal guidelines a challenging task and other interested
parties noted that States had too much discretion in documenting
sufficient access to care. Therefore, we proposed developing a template
to support State analyses of rate reduction or restructuring SPAs that
fail to meet the criteria in Sec. 447.203(c)(1). As noted elsewhere in
the preamble, if finalized, we anticipate releasing subregulatory
guidance, including a template to support completion of the analysis
that would be required under paragraph (c)(2), prior to the beginning
date of the Comparative Payment Rate Analysis and Payment Rate
Disclosure Timeframe proposed in Sec. 447.203(b)(4), which is proposed
to begin 2 years after the effective date of the final rule. In the
intervening period, we anticipate working directly with States through
the SPA review process to ensure compliance with section 1902(a)(30)(A)
of the Act. Additionally, we are seeking public comment regarding our
alternative consideration to propose allowing States to use their own
unstructured data, similar to the AMRP
[[Page 28077]]
process, for States that fail to meet all three criteria in Sec.
447.203(c)(1).
After careful consideration, we ultimately determined that the
requirements in proposed Sec. 447.203(b) and (c) would strike a more
optimal balance between alleviating State and Federal administrative
burden, while ensuring a transparent, data-driven, and consistent
approach to States' implementation and our oversight of State
compliance with the access requirement in section 1902(a)(30)(A) of the
Act.
E. Accounting Statement and Table
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf), we have prepared an accounting statement in
Table 43 showing the classification of the impact associated with the
provisions of this proposed rule. Note, Table 43 shown previously in
this proposed rule provides a summary of the one-time and annual costs
estimates.
Table 44--Accounting Table
----------------------------------------------------------------------------------------------------------------
Units
-----------------------------------------------
Category Estimates Discount rate Period
Year dollar (%) covered
----------------------------------------------------------------------------------------------------------------
Regulatory Review Costs:
Annualized Monetized ($million/year)........ .112 2023 7 2024-2028
.117 2023 3 2024-2028
Costs to States:
Annualized Monetized ($million/year)........ 72.12 2023 7 2024-2028
75.22 2023 3 2024-2028
Costs to Beneficiaries:
Annualized Monetized ($million/year)........ 0.47 2023 7 2024-2028
0.49 2023 3 2024-2028
Costs to Providers:
Annualized Monetized ($million/year)........ 102.05 2023 7 2024-2028
106.44 2023 3 2024-2028
Costs to Managed Care Entities:
Annualized Monetized ($million/year)........ 6.84 2023 7 2024-2028
7.13 2023 3 2024-2028
----------------------------------------------------------------------------------------------------------------
F. Regulatory Flexibility Act (RFA)
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. For purposes of the RFA, we estimate that
almost all of Home Health Care Services, Services for the Elderly and
Persons with Disabilities, and Direct Health and Medical Insurance
Carriers are small entities as that term is used in the RFA (include
small businesses, nonprofit organizations, and small governmental
jurisdictions). 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 $8.0 million to $41.5 million in
any 1 year).
For purposes of the RFA, approximately 95 percent of the health
care industries impacted are considered small businesses according to
the Small Business Administration's size standards with total revenues
of $41 million or less in any 1 year.
According to the SBA's website at http://www.sba.gov/content/small-business-size-standards HCBS Provider Costs and Managed care Entity
fall in the North American Industrial Classification System 621610 Home
Health Care Services, 624120 Services for the Elderly and Persons with
Disabilities, and 524114 Direct Health and Medical Insurance Carriers.
Table 45--HCBS Providers Costs and Managed Care Entity Size Standards
----------------------------------------------------------------------------------------------------------------
SBA size
standard/small
NAICS (6-digit) Industry subsector description entity Total small
threshold businesses
(million)
----------------------------------------------------------------------------------------------------------------
621610..................................... Home Health Care Services.......... $15 20,597
624120..................................... Services for the Elderly and 19 20,740
Persons with Disabilities.
524114..................................... Direct Health and Medical Insurance 47 501
Carriers.
----------------------------------------------------------------------------------------------------------------
Source: 2012 Economic Census. Note, no recent data exist for Enterprise Receipt Size.
Individuals and States are not included in the definition of a
small entity. This rule will not have a significant impact measured
change in revenue of 3 to 5 percent on a substantial number of small
businesses or other small entities. All the industries combined,
according to the 2012 Economic Census, earned approximately
$46,771,961,000.00. Hence, all the costs combined, amounts to about 1
percent.
Therefore, as its measure of significant economic impact on a
substantial number of small entities, HHS uses a change in revenue of
more than 3 to 5 percent. We do not believe that this threshold will be
reached by the requirements in this proposed rule. Therefore, the
Secretary has certified that this proposed will not have a significant
economic impact on a substantial number of small entities.
[[Page 28078]]
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 Act. 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 proposed rule will
not have a significant impact on the operations of small rural
hospitals since small hospitals are not affected by the proposed rule.
Therefore, the Secretary has certified that this proposed rule will not
have a significant impact on the operations of a substantial number of
small rural hospitals.
G. Unfunded Mandates Reform Act (UMRA)
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 2023, that
threshold is approximately $177 million. This proposed rule would not
impose a mandate that will result in the expenditure by State, local,
and Tribal Governments, in the aggregate, or by the private sector, of
more than $177 million in any 1 year.
Several of the provisions in the proposed rule address gaps in
existing regulations. In these cases, the costs for States to implement
those proposals would be minimal. For the remaining areas of the
proposed rule, we have sought to minimize burden whenever possible
while still achieving the goals of this rulemaking. We further note
that, if finalized, States would be able to claim administrative match
for the work required to implement the proposals.
H. Federalism
E.O. 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 impose
substantial direct costs on State or local governments, preempt State
law, or otherwise have Federalism implications. As mentioned in the
previous section of this rule, the costs to States by our estimate do
not rise to the level of specified thresholds for significant burden to
States. In addition, many proposals amend existing requirements or
further requirements that already exist in statute, and as such would
not create any new conflict with State law.
I. Conclusion
If the policies in this proposed rule are finalized, it will enable
us to implement enhanced access to health care services for Medicaid
beneficiaries across FFS, managed care, and HCBS delivery systems.
The analysis in section V. of this proposed rule, together with the
rest of this preamble, provides a regulatory impact analysis. In
accordance with the provisions of E.O. 12866, this proposed rule was
reviewed by the Office of Management and Budget.
Chiquita Brooks-LaSure, Administrator of the Centers for Medicare &
Medicaid Services, approved this document on XX XX, 20XX
List of Subjects
42 CFR Part 431
Administrative practice and procedure, Consumer protection, Grant
programs--health, Medicaid, Organization and functions (Government
agencies), Public assistance programs, Reporting and recordkeeping
requirement.
42 CFR Part 438
Administrative practice and procedure, Grant programs--health,
Health professions, Medicaid, Older adults, People with Disabilities,
Reporting and recordkeeping requirements.
42 CFR Part 441
Administrative practice and procedure, Consumer protection, Grant
programs--health, Health professions, Medicaid, Older adults, People
with Disabilities, Reporting and recordkeeping requirements
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 proposes to amend 42 CFR Chapter IV as set forth
below:
PART 431--STATE ORGANIZATION AND GENERAL ADMINISTRATION
0
1. The authority citation for part 431 continues to read as follows:
Authority: 42 U.S.C. 1302.
0
2. Revise Sec. 431.12 to read as follows:
Sec. 431.12 Medicaid Advisory Committee and Beneficiary Advisory
Group.
(a) Basis and purpose. This section, based on section 1902(a)(4) of
the Act, prescribes State Plan requirements for establishment and
ongoing operation of a public Medicaid Advisory Committee (MAC) with a
dedicated Beneficiary Advisory Group (BAG) comprised of current and
former Medicaid beneficiaries, their family members and caregivers, to
advise the State Medicaid agency on matters of concern related to
policy development, and matters related to the effective administration
of the Medicaid program.
(b) State plan requirement. The State Plan must provide for a MAC
and a BAG that will advise the Medicaid Agency Director on matters of
concern related to policy development and matters related to the
effective administration of the Medicaid program.
(c) Appointment of members. The agency director, or a higher State
authority, must appoint members to the MAC and BAG on a rotating and
continuous basis. The State must create a process for recruitment and
appointment of members and publish this information on the States
website as specified in paragraph (f).
(d) MAC membership and composition. The membership of the MAC must
be composed of the following percentage and representative categories
of interested parties in the State:
(1) Minimum of 25 percent of committee members must be from the
BAG.
(2) The remaining committee members must include representation of
at least one from each of the following categories:
(A) State or local consumer advocacy groups or other community-
based organizations that represent the interests of, or provide direct
service, to Medicaid beneficiaries.
(B) Clinical providers or administrators who are familiar with the
health and social needs of Medicaid beneficiaries and with the
resources available and required for their care. This includes
providers or administrators of primary care, specialty care, and long-
term care.
(C) Participating Medicaid managed care plans, or the State health
plan association representing such plans, as applicable; and
(D) Other State agencies that serve Medicaid beneficiaries (for
example, foster care agency, mental health agency, health department,
State agencies delegated to conduct eligibility determinations for
Medicaid, State Unit on Aging), as ex-officio members.
[[Page 28079]]
(e) Beneficiary Advisory Group. The State must form and support a
BAG, which can be an existing beneficiary group, that is comprised of:
Individuals who are currently or have been Medicaid beneficiaries and
individuals with direct experience supporting Medicaid beneficiaries
(family members or caregivers of those enrolled in Medicaid), to advise
and provide input to the State regarding their experience with the
Medicaid program, on matters of concern related to policy development
and matters related to the effective administration of the Medicaid
program.
(1) The MAC members described in paragraph (d)(1) of this section
must also be members of the BAG.
(2) The BAG must meet separately from the MAC, on a regular basis,
and in advance of each MAC meeting to ensure BAG member preparation for
each MAC meeting.
(f) MAC and BAG administration. The State agency must create
standardized processes and practices for the administration of the MAC
and the BAG that are available for public review on the State website.
The State agency must--
(1) Develop and publish by posting publicly on its website, bylaws
for governance of the MAC and BAG, a current list of MAC and BAG
membership, and past meeting minutes of the MAC and BAG meetings,
including a list of meeting attendees;
(2) Develop and publish by posting publicly on its website a
process for MAC and BAG member recruitment and appointment and
selection of MAC and BAG leadership;
(3) Develop, publish by posting publicly on its website, and
implement a regular meeting schedule for the MAC and BAG; the MAC and
BAG must each meet at least once per quarter and hold off-cycle
meetings as needed.
(4) Make at least two MAC meetings per year open to the public and
those meetings must include a dedicated time during the meeting for the
public to make comments. The public must be adequately notified of the
date, location, and time of each public MAC meeting at least 30
calendar days in advance. BAG meetings are not required to be open to
the public, unless the State's BAG members decide otherwise. The same
requirements would apply to States whose BAG meetings were determined,
by its membership, to be open to the public;
(5) Offer a variety of in-person and virtual attendance options
including, at a minimum telephone dial-in options at the MAC and BAG
meetings for its members. If the MAC or BAG meeting is deemed open to
the public, the State must offer at a minimum a telephone dial-in
option for members of the public;
(6) Ensure meeting times and locations for MAC and BAG meetings are
selected to maximize member attendance and may vary by meeting; and
(7) Facilitate participation of beneficiaries by ensuring that that
meetings are accessible to people with disabilities, that reasonable
modifications are provided when necessary to ensure access and enable
meaningful participation, and communications with individuals with
disabilities are as effective as with others, that reasonable steps are
taken to provide meaningful access to individuals with Limited English
Proficiency, and that meetings comply with the requirements at Sec.
435.905(b) of this chapter and applicable regulations implementing the
ADA, section 504 of the Rehabilitation Act, and section 1557 of the
Affordable Care Act at 28 CFR part 35 and 45 CFR parts 84 and 92.
(g) MAC and BAG participation and scope. The MAC and BAG
participants must have the opportunity to participate in and provide
recommendations to the State agency on matters related to policy
development and matters related to the effective administration of the
Medicaid program. At a minimum, the MAC and BAG must determine, in
collaboration with the State, which topics to provide advice on related
to--
(1) Additions and changes to services;
(2) Coordination of care;
(3) Quality of services;
(4) Eligibility, enrollment, and renewal processes;
(5) Beneficiary and provider communications by State Medicaid
agency and Medicaid managed care plans;
(6) Cultural competency, language access, health equity, and
disparities and biases in the Medicaid program; or
(7) Other issues that impact the provision or outcomes of health
and medical care services in the Medicaid program as by the MAC, BAG,
or State.
(h) State agency staff assistance, participation, and financial
help. The State agency must provide staff to support planning and
execution of the MAC and the BAG to include--
(1) Recruitment of MAC and BAG members;
(2) Planning and execution of all MAC and BAG meetings and the
production of meeting minutes that include actions taken or anticipated
actions by the State in response to interested parties' feedback
provided during the meeting. The minutes are to be posted on the
State's website within 30 calendar days following each meeting.
Additionally, the State must also produce and post on its website an
annual report as specified in paragraph (i) of this section; and
(3) The provision of appropriate support and preparation (providing
research or other information needed) to the Medicaid beneficiary MAC
and BAG members to ensure meaningful participation. These tasks
include--
(i) Providing staff whose responsibilities include facilitating MAC
and BAG member engagement;
(ii) Providing financial support, if necessary, to facilitate
Medicaid beneficiary engagement in the MAC and the BAG.
(iii) Attendance by at least one staff member from the State
agency's executive staff at all MAC and BAG meetings.
(i) Annual report. The MAC, with support from the State, submit an
annual report describing its activities, topics discussed, and
recommendations. The State must review the report and include responses
to the recommended actions. The State agency must then--
(1) Provide MAC members with final review of the report;
(2) Ensure that the annual report of the MAC includes a section
describing the activities, topics discussed, and recommendations of the
BAG, as well as the State's responses to the recommendations; and
(3) Post the report to the State's website.
(j) Federal financial participation. FFP is available at 50 percent
of expenditures for the MAC and BAG activities.
0
3. Amend Sec. 431.408 by revising paragraph (a)(3)(i) to read as
follows:
Sec. 431.408 State public notice process.
(a) * * *
(3) * * *
(i) The Medicaid Advisory Committee and Beneficiary Advisory Group
that operate in accordance with Sec. 431.12 of this subpart; or
* * * * *
PART 438--MANAGED CARE
0
4. The authority citation for part 438 continues to read as follows:
Authority: 42 U.S.C. 1302.
0
5. Section 438.72 is added to subpart B to read as follows:
Sec. 438.72 Additional requirements for long-term services and
supports.
(a) [Reserved]
(b) Services authorized under section 1915(c) waivers and section
1915(i), (j), and (k) State plan authorities. The State
[[Page 28080]]
must comply with the review of the person-centered service plan
requirements at Sec. 441.301(c)(1) through (3), the incident
management system requirements at Sec. 441.302(a)(6), the payment
adequacy requirements at Sec. 441.302(k), the reporting requirements
at Sec. 441.311, and the website transparency requirements at Sec.
441.313 for services authorized under section 1915(c) waivers and
section 1915(i), (j), and (k) State plan authorities.
PART 441--SERVICES: REQUIREMENTS AND LIMITS APPLICABLE TO SPECIFIC
SERVICES
0
6. The authority citation for part 441 continues to read as follows:
Authority: 42 U.S.C. 1302.
0
7. Amend Sec. 441.301 by revising paragraphs (c)(1) and (3), and
adding paragraph (c)(7) to read as follows:
Sec. 441.301 Contents of request for a waiver.
* * * * *
(c) * * *
(1) Person-centered planning process. The individual, or if
applicable, the individual and the individual's authorized
representative, will lead the person-centered planning process. When
the term ``individual'' is used throughout this section, it includes
the individual's authorized representative if applicable. In addition,
the person-centered planning process:
* * * * *
(3) Review of the person-centered service plan--(i) Requirement.
The State must ensure that the person-centered service plan is
reviewed, and revised, as appropriate, based upon the reassessment of
functional need as required by Sec. 441.365(e), at least every 12
months, when the individual's circumstances or needs change
significantly, or at the request of the individual.
(ii) Minimum performance at the State level. The State must
demonstrate, through the reporting requirements at Sec. 441.311(b)(3),
that it meets the following minimum performance levels:
(A) Complete a reassessment of functional need at least every 12
months for no less than 90 percent of the individuals continuously
enrolled in the waiver for at least 365 days; and
(B) Review and revise, as appropriate, the person-centered service
plan, based upon the reassessment of functional need, at least every 12
months for no less than 90 percent of the individuals continuously
enrolled in the waiver for at least 365 days.
(iii) Effective date. The performance levels described in paragraph
(c)(3)(ii) of this section are effective 3 years after the date of
enactment of this paragraph; and in the case of the State that
implements a managed care delivery system under the authority of
sections 1915(a), 1915(b), 1932(a), or 1115(a) of the Act and includes
HCBS in the MCO's, PIHP's, or PAHP's contract, the first managed care
plan contract rating period that begins on or after 3 years after the
date of enactment of this paragraph.
* * * * *
(7) Grievance system--(i) Purpose. The State must establish a
procedure under which a beneficiary may file a grievance related to the
State or a provider's compliance with paragraphs (c)(1) through (6) of
this section. This requirement does not apply to a managed care
delivery system under the authority of sections 1915(a), 1915(b),
1932(a), or 1115(a) of the Act.
(ii) Definitions. As used in this section:
Grievance means an expression of dissatisfaction or complaint
related to the State's or a provider's compliance with paragraphs
(c)(1) through (6), regardless of whether remedial action is requested.
Grievance system means the processes the State implements to handle
grievances, as well as the processes to collect and track information
about them.
(iii) General requirements. (A) The beneficiary or a beneficiary's
authorized representative, if applicable, may file a grievance. All
references to beneficiary include the role of the beneficiary's
representative, if applicable.
(1) Another individual or entity may file a grievance on behalf of
the beneficiary with the written consent of the beneficiary or
authorized representative.
(2) A provider cannot file a grievance that would violate the
State's conflict of interest guidelines, as required in Sec.
441.540(a)(5).
(B) The State must:
(1) Base its grievance processes on written policies and procedures
that, at a minimum, meet the conditions set forth in this subsection;
(2) Provide beneficiaries reasonable assistance in completing forms
and taking other procedural steps related to a grievance. This
includes, but is not limited to, ensuring the grievance system is
accessible to individuals with disabilities and persons who are limited
English proficient, consistent with Sec. 435.905(b) of this chapter,
and includes auxiliary aids and services upon request, such as
providing interpreter services and toll-free numbers that have adequate
TTY/TTD and interpreter capability;
(3) Ensure that punitive action is neither threatened nor taken
against an individual filing a grievance;
(4) Accept grievances and requests for expedited resolution or
extension of timeframes from the beneficiary;
(5) Provide to the beneficiary the notices and information required
under this subsection, including information on their rights under the
grievance system and on how to file grievance, and ensure that such
information is accessible for individuals with disabilities and
individuals who are limited English proficient in accordance with Sec.
435.905(b);
(6) Review any grievance resolution with which the beneficiary is
dissatisfied; and
(7) Provide information about the grievance system to all providers
and subcontractors approved to deliver services.
(C) The process for handling grievances must:
(1) Allow the beneficiary to file a grievance with the State either
orally or in writing.
(2) Acknowledge receipt of each grievance.
(3) Ensure that the individuals who make decisions on grievances
are individuals:
(i) Who were neither involved in any previous level of review or
decision-making related to the grievance nor a subordinate of any such
individual;
(ii) Who are individuals who have the appropriate clinical and non-
clinical expertise, as determined by the State; and
(iii) Who consider all comments, documents, records, and other
information submitted by the beneficiary without regard to whether such
information was submitted to or considered previously by the State.
(4) Provide the beneficiary a reasonable opportunity, face-to-face
(including through the use of audio or video technology) and in
writing, to present evidence and testimony and make legal and factual
arguments related to their grievance. The State must inform the
beneficiary of the limited time available for this sufficiently in
advance of the resolution timeframe for grievances as specified in
paragraphs (c)(7)(v)(B)(1) and (2) of this section.
(5) Provide the beneficiary their case file, including medical
records in compliance with 45 CFR 164.510(b), other documents and
records, and any new or additional evidence considered, relied upon, or
generated by the State related to the grievance. This information must
be provided free of charge and sufficiently in advance of the
[[Page 28081]]
resolution timeframe for grievance as specified in paragraphs
(c)(7)(v)(B)(1) and (2) of this section.
(6) Provide beneficiaries, free of charge, with language services,
including written translation and interpreter services in accordance
with Sec. 435.905(b), to support their participation in grievance
processes and their use of the grievance system.
(iv) Filing timeframes. (A) A beneficiary may file a grievance at
any time.
(B) The beneficiary may request expedited resolution of a grievance
whenever there is a substantial risk that resolution within standard
timeframes will adversely affect the beneficiary's health, safety, or
welfare, as described in paragraph (c)(7)(v) of this section.
(v) Resolution and notification--(A) Basic rule. The State must
resolve each grievance, and provide notice, as expeditiously as the
beneficiary's health, safety, and welfare requires, within State-
established timeframes that may not exceed the timeframes specified in
this section.
(B) Specific timeframes--(1) Standard resolution of grievances. For
standard resolution of a grievance and notice to the affected parties,
the timeframe may not exceed 90 calendar days from the day the State
receives the grievance. This timeframe may be extended under paragraph
(c)(7)(v)(C) of this section.
(2) Expedited resolution of grievances. For expedited resolution of
a grievance and notice to affected parties, the State must establish a
timeframe that is no longer than 14 calendar days after the State
receives the grievance. This timeframe may be extended under paragraph
(c)(7)(v)(C) of this section.
(C) Extension of timeframes. (1) The States may extend the
timeframes from those in paragraph (c)(7)(v)(B) of this section by up
to 14 calendar days if--
(i) The beneficiary requests the extension; or
(ii) The State documents that there is need for additional
information and how the delay is in the beneficiary's interest.
(D) Requirements following extension. If the State extends the
timeframes not at the request of the beneficiary, it must complete all
of the following:
(1) Make reasonable efforts to give the beneficiary prompt oral
notice of the delay.
(2) Within 2 calendar days of determining a need for a delay, but
no later than the timeframes in paragraph (c)(7)(v)(B) of this section,
give the beneficiary written notice of the reason for the decision to
extend the timeframe.
(3) Resolve the grievance as expeditiously as the beneficiary's
health condition requires and no later than the date the extension
expires.
(vi) Format of notice--(A) Written notice. The State must establish
a method to notify a beneficiary of the resolution of a grievance and
ensure that such methods meet, at a minimum, the standards described at
Sec. 435.905(b) of this chapter.
(B) Oral notice. For notice of an expedited resolution, the State
must also make reasonable efforts to provide oral notice.
(vii) Recordkeeping. (A) The State must maintain records of
grievances and must review the information as part of its ongoing
monitoring procedures.
(B) The record of each grievance must contain, at a minimum, all of
the following information:
(1) A general description of the reason for the grievance.
(2) The date received.
(3) The date of each review or, if applicable, review meeting.
(4) Resolution of the grievance, as applicable.
(5) Date of resolution, if applicable.
(6) Name of the beneficiary for whom the grievance was filed.
(C) The record must be accurately maintained in a manner available
upon request to CMS.
(viii) Effective date. This requirement is effective 2 years after
the date of enactment of this paragraph.
0
8. Amend Sec. 441.302 by--
0
a. Adding paragraph (a)(6);
0
b. Revising paragraph (h);
0
c. Adding new paragraph (k).
The additions and revision read as follows:
Sec. 441.302 State assurances.
* * * * *
(a) * * *
(6) Assurance that the State operates and maintains an incident
management system that identifies, reports, triages, investigates,
resolves, tracks, and trends critical incidents.
(i) Requirements. The State must:
(A) Define critical incident to include, at a minimum--
(1) Verbal, physical, sexual, psychological, or emotional abuse;
(2) Neglect;
(3) Exploitation including financial exploitation;
(4) Misuse or unauthorized use of restrictive interventions or
seclusion;
(5) A medication error resulting in a telephone call to or a
consultation with a poison control center, an emergency department
visit, an urgent care visit, a hospitalization, or death; or
(6) An unexplained or unanticipated death, including but not
limited to a death caused by abuse or neglect.
(B) Use an information system, as defined in 45 CFR 164.304 and
compliant with 45 CFR part 164, that, at a minimum--
(1) Enables electronic critical incident data collection;
(2) Tracking (including of the status and resolution of
investigations), and;
(3) Trending.
(C) Require providers to report to the State, within State-
established timeframes and procedures, any critical incident that
occurs during the delivery of services authorized under section 1915(c)
of the Act and as specified in the waiver participant's person-centered
service plan, or occurs as a result of the failure to deliver services
authorized under section 1915(c) of the Act and as specified in the
waiver participant's person-centered service plan.
(D) Use claims data, Medicaid fraud control unit data, and data
from other State agencies such as Adult Protective Services or Child
Protective Services to the extent permissible under applicable State
law to identify critical incidents that are unreported by providers and
occur during the delivery of services authorized under section 1915(c)
of the Act and as specified in the waiver participant's person-centered
service plan, or occur as a result of the failure to deliver services
authorized under section 1915(c) of the Act and as specified in the
waiver participant's person-centered service plan.
(E) Ensure that there is information sharing on the status and
resolution of investigations, such as through the use of information
sharing agreements, between the State and the entity or entities
responsible in the State for investigating critical incidents as
defined in Sec. 441.302(a)(6)(i)(A) if the State refers critical
incidents to other entities for investigation;
(F) Separately investigate critical incidents if the investigative
agency fails to report the resolution of an investigation within State-
specified timeframes; and
(G) Demonstrate that it meets the requirements in paragraph (a)(6)
of this section through the reporting requirement at Sec.
441.311(b)(1).
(ii) Minimum performance at the State level. The State must
demonstrate, through the reporting requirements at Sec. 441.311(b)(2),
that it meets the following minimum performance levels:
(A) Initiate an investigation, within State-specified timeframes,
for no less than 90 percent of critical incidents;
(B) Complete an investigation and determine the resolution of the
investigation, within State-specified timeframes, for no less than 90
percent of critical incidents; and
[[Page 28082]]
(C) Ensure that corrective action has been completed within State-
specified timeframes, for no less than 90 percent of critical incidents
that require corrective action.
(iii) Effective date. This requirement is effective 3 years after
the date of enactment of this paragraph; and in the case of the State
that implements a managed care delivery system under the authority of
sections 1915(a), 1915(b), 1932(a), or 1115(a) of the Act and includes
HCBS in the MCO's, PIHP's, or PAHP's contract, the first managed care
plan contract rating period that begins on or after 3 years after the
date of enactment of this paragraph.
* * * * *
(h) Reporting. Assurance that the agency will provide CMS with
information on the waiver's impact, including the data and information
as required in Sec. 441.311.
* * * * *
(k) HCBS payment adequacy. Assurance that payment rates are
adequate to ensure a sufficient direct care workforce to meet the needs
of beneficiaries and provide access to services in the amount,
duration, and scope specified in the person-centered service plan.
(1) Definitions. As used in this section.
(i) Compensation means:
(A) Salary, wages, and other remuneration as defined by the Fair
Labor Standards Act and implementing regulations (29 U.S.C. 201 et
seq., 29 CFR parts 531 and 778);
(B) Benefits (such as health and dental benefits, sick leave, and
tuition reimbursement); and
(C) The employer share of payroll taxes for direct care workers
delivering services authorized under section 1915(c) of the Act.
(ii) Direct care worker means any of the following individuals:
(A) A registered nurse, licensed practical nurse, nurse
practitioner, or clinical nurse specialist who provides nursing
services to Medicaid-eligible individuals receiving home and community-
based services available under this subpart;
(B) A licensed or certified nursing assistant who provides such
services under the supervision of a registered nurse, licensed
practical nurse, nurse practitioner, or clinical nurse specialist;
(C) A direct support professional;
(D) A personal care attendant;
(E) A home health aide; or
(F) Other individuals who are paid to provide services to address
activities of daily living or instrumental activities of daily living,
behavioral supports, employment supports, or other services to promote
community integration directly to Medicaid-eligible individuals
receiving home and community-based services available under this
subpart.
(G) A direct care worker may be employed by a Medicaid provider,
State agency, or third party; contracted with a Medicaid provider,
State agency, or third party; or delivering services under a self-
directed service model.
(2) Requirement. The State must demonstrate, through the reporting
requirements at Sec. 441.311(e), that it meets the minimum performance
levels in paragraph (k)(3) of this section for the services at Sec.
440.180(b)(2) through (4) that are delivered by direct care workers and
authorized under section 1915(c) of the Act.
(3) Minimum performance at the State level. The State must meet the
following minimum performance level, calculated as the percentage of
total payment for a service represented by total compensation to direct
care workers:
(i) At least 80 percent of all payments with respect to services at
Sec. 440.180(b)(2) through (4) must be spent on compensation for
direct care workers.
(ii) [Reserved]
(4) Effective date. This requirement is effective 4 years after the
date of enactment of this paragraph; and in the case of the State that
implements a managed care delivery system under the authority of
sections 1915(a), 1915(b), 1932(a), or 1115(a) of the Act and includes
HCBS in the MCO's, PIHP's, or PAHP's contract, the first managed care
plan contract rating period that begins on or after 4 years after the
date of enactment of this paragraph.
0
9. Amend Sec. 441.303 by revising paragraph (f)(6) to read as follows:
Sec. 441.303 Supporting documentation required.
* * * * *
(f) * * *
(6) The State must indicate the number of unduplicated
beneficiaries to which it intends to provide waiver services in each
year of its program. This number will constitute a limit on the size of
the waiver program unless the State requests and the Secretary approves
a greater number of waiver participants in a waiver amendment. If the
State has a limit on the size of the waiver program and maintains a
list of individuals who are waiting to enroll in the waiver program,
the State must meet the reporting requirements at Sec. 441.311(d)(1).
* * * * *
0
10. Section 441.311 is added to subpart G to read as follows:
Sec. 441.311 Reporting requirements.
(a) Basis and scope. Section 1902(a)(6) of the Act requires State
Medicaid agencies to make such reports, in such form and containing
such information, as the Secretary may from time to time require, and
to comply with such provisions as the Secretary may from time to time
find necessary to assure the correctness and verification of such
reports. Section 1902(a)(19) of the Act requires States to provide
safeguards to assure that eligibility for Medicaid-covered care and
services will be determined and provided in a manner that is consistent
with simplification, simplicity of administration, and in the best
interest of Medicaid beneficiaries. This section describes the
reporting requirements for States for section 1915(c) waiver programs,
under the authority at section 1902(a)(6) and (a)(19) of the Act.
(b) Compliance reporting--(1) Incident management system. As
described in Sec. 441.302(a)(6)--
(i) The State must report, every 24 months, according to the format
and specifications provided by CMS, on the results of an incident
management system assessment to demonstrate that it meets the
requirements in Sec. 441.302(a)(6).
(ii) CMS may reduce the frequency of reporting to up to once every
60 months for States with incident management systems that are
determined by CMS to meet the requirements in Sec. 441.302(a)(6).
(2) Critical incidents, as defined in Sec. 441.302(a)(6)(i)(A).
The State must report to CMS annually on the following, according to
the format and specifications provided by CMS:
(i) Number and percent of critical incidents for which an
investigation was initiated within State-specified timeframes;
(ii) Number and percent of critical incidents that are investigated
and for which the State determines the resolution within State-
specified timeframes;
(iii) Number and percent of critical incidents requiring corrective
action, as determined by the State, for which the required corrective
action has been completed within State-specified timeframes.
(3) Person-centered planning, as described in Sec. 441.301(c)(1)
through (3).
(i) Percent of beneficiaries continuously enrolled for at least 365
days for whom a reassessment of functional need was completed within
the past 12 months. The State may report this metric for a
statistically valid random sample of beneficiaries.
[[Page 28083]]
(ii) Percent of beneficiaries continuously enrolled for at least
365 days who had a service plan updated as a result of a re-assessment
of functional need within the past 12 months. The State may report this
metric for a statistically valid random sample of beneficiaries.
(4) The type, amount, and cost of services provided under the State
plan.
(c) Reporting on the Home and Community-Based Services Quality
Measure Set, as described in Sec. 441.312.
(1) General rules. The State--
(i) Must report every other year, according to the format and
schedule prescribed by the Secretary through the process for developing
and updating the measure set described in Sec. 441.312(d), on all
measures in the Home and Community-Based Services Quality Measure Set
that are identified by the Secretary pursuant to Sec.
441.312(d)(1)(ii) of this subpart.
(ii) May report on all other measures in the Home and Community-
Based Services Quality Measure Set that are not described in Sec.
441.312(d)(1)(ii) and (iii) of this subpart.
(iii) Must establish, subject to CMS review and approval, State
performance targets for each of the measures in the Home and Community-
Based Services Quality Measure Set that are identified by the Secretary
pursuant to Sec. 441.312(d)(1)(ii) and (iii) of this subpart and
describe the quality improvement strategies that the State will pursue
to achieve the performance targets.
(iv) May establish State performance targets for each of the
measures in the Home and Community-Based Services Quality Measure Set
that are not identified by the Secretary pursuant to Sec.
441.312(d)(1)(ii) and (iii) of this subpart and describe the quality
improvement strategies that the State will pursue to achieve the
performance targets.
(2) Measures identified per Sec. 441.312(d)(1)(iii) of this
subpart will be reported by the Secretary on behalf of the State.
(3) In reporting on Home and Community-Based Services Quality
Measure Set measures, the State may, but is not required to:
(i) Report on the measures identified by the Secretary pursuant to
Sec. 441.312(c) of this subpart for which reporting will be, but is
not yet required (that is, reporting has not yet been phased-in).
(ii) Report on the populations identified by the Secretary pursuant
to Sec. 441.312(c) of this subpart for whom reporting will be, but is
not yet required.
(d) Access reporting. The State must report to CMS annually on the
following, according to the format and specifications provided by CMS:
(1) Waiver waiting lists. (i) A description of how the State
maintains the list of individuals who are waiting to enroll in the
waiver program, if the State has a limit on the size of the waiver
program, as described in Sec. 441.303(f)(6), and maintains a list of
individuals who are waiting to enroll in the waiver program. This
description must include, but is not limited to:
(A) Information on whether the State screens individuals on the
list for eligibility for the waiver program;
(B) Whether the State periodically re-screens individuals on the
list for eligibility; and
(C) The frequency of re-screening, if applicable.
(ii) Number of people on the list of individuals who are waiting to
enroll in the waiver program, if applicable.
(iii) Average amount of time that individuals newly enrolled in the
waiver program in the past 12 months were on the list of individuals
waiting to enroll in the waiver program, if applicable.
(2) Access to homemaker services, home health aide, and personal
care. (i) Average amount of time from when homemaker services, home
health aide services, or personal care services, as listed in Sec.
440.180(b)(2) through (4), are initially approved to when services
began, for individuals newly approved to begin receiving services
within the past 12 months. The State may report this metric for a
statistically valid random sample of beneficiaries.
(ii) Percent of authorized hours for homemaker services, home
health aide services, or personal care services, as listed in Sec.
440.180(b)(2) through (4), that are provided within the past 12 months.
The State may report this metric for a statistically valid random
sample of beneficiaries.
(e) Payment adequacy. The State must report to CMS annually on the
percent of payments for certain services, as specified in Sec.
441.302(k)(3)(i), that are spent on compensation for direct care
workers, at the time and in the form and manner specified by CMS. The
State must report separately for each service and, within each service,
must separately report services that are self-directed.
(1) Services. The State must report on payment adequacy for the
services at Sec. 440.180(b)(2) through (4) that are authorized under
section 1915(c) of the Act.
(2) [Reserved]
(f) Effective date. (1) The reporting requirements at paragraphs
(b) through (d) of this section are effective 3 years after the date of
enactment of this paragraph; and in the case of a State that implements
a managed care delivery system under the authority of sections 1915(a),
1915(b), 1932(a), or 1115(a) of the Act and includes HCBS in the MCO's,
PIHP's, or PAHP's contract, the first managed care plan contract rating
period that begins on or after 3 years after the date of enactment of
this paragraph.
(2) The reporting requirements at paragraph (e) of this section are
effective 4 years after the date of enactment of this paragraph; and in
the case of a State that implements a managed care delivery system
under the authority of sections 1915(a), 1915(b), 1932(a), or 1115(a)
of the Act and includes HCBS in the MCO's, PIHP's, or PAHP's contract,
the first managed care plan contract rating period that begins on or
after 4 years after the date of enactment of this paragraph.
0
11. Section 441.312 is added to subpart G to read as follows:
Sec. 441.312 Home and Community-Based Services Quality Measure Set.
(a) Basis and scope. Section 1102(a) of the Act provides the
Secretary of HHS with authority to make and publish rules and
regulations that are necessary for the efficient administration of the
Medicaid program. Section 1902(a)(6) of the Act requires State Medicaid
agencies to make such reports, in such form and containing such
information, as the Secretary may from time to time require, and to
comply with such provisions as the Secretary may from time to time find
necessary to assure the correctness and verification of such reports.
This section describes the Home and Community-Based Services Quality
Measure Set, which States are required to use in section 1915(c) waiver
programs to promote public transparency related to the administration
of Medicaid covered HCBS, under the authority at sections 1102(a) and
1902(a)(6) of the Act.
(b) Definitions. As used in this subpart--
Attribution rules means the process States use to assign
beneficiaries to a specific health care program or delivery system for
the purpose of calculating the measures on the Home and Community-Based
Services Quality Measure Set.
Home and Community-Based Services Quality Measure Set means the
Home and Community-Based Services Quality Measures for Medicaid
established and updated at least every other year by the Secretary
through a process that allows for public input and comment,
[[Page 28084]]
including through the Federal Register, as described in paragraph (d)
of this section.
(c) Responsibilities of the Secretary. The Secretary shall--
(1) Identify, and update at least every other year, beginning no
later than December 31, 2025 and biennially thereafter, the quality
measures to be included in the Home and Community-Based Services
Quality Measure Set as defined in paragraph (b) of this section.
(2) Consult at least every other year with States and other
interested parties identified in paragraph (g) of this section to--
(i) Establish priorities for the development and advancement of the
Home and Community-Based Services Quality Measure Set;
(ii) Identify newly developed or other measures which should be
added including to address any gaps in the measures included in the
Home and Community-Based Services Quality Measure Set;
(iii) Identify measures which should be removed as they no longer
strengthen the Home and Community-Based Services Quality Measure Set;
and
(iv) Ensure that all measures included in the Home and Community-
Based Services Quality Measure Set reflect an evidence-based process
including testing, validation, and consensus among interested parties;
are meaningful for States; are feasible for State-level, program-level,
or provider-level reporting as appropriate.
(3) In consultation with States, develop and update, at least every
other year, the HCBS Quality Measure Set using a process that allows
for public input and comment as described in paragraph (d) of this
section.
(d) Process for developing and updating the HCBS Quality Measure
Set. The process for developing and updating the HCBS Quality Measure
Set will address all of the following:
(1) Identification of all measures in the Home and Community-Based
Services Quality Measure Set, including:
(i) Measures newly added and measures removed from the prior
version of the Home and Community-Based Services Quality Measure Set;
(ii) The specific measures for which reporting is mandatory;
(iii) The measures for which the Secretary will complete reporting
on behalf of States and the measures for which States may elect to have
the Secretary report on their behalf; and
(iv) The measures, if any, for which the Secretary will provide
States with additional time to report, as well as how much additional
time the Secretary will provide, in accordance with paragraph (c) of
this section.
(2) Technical information to States on how to collect and calculate
the data on the Home and Community-Based Services Quality Measure Set.
(3) Standardized format and reporting schedule for reporting
measure data required under this section.
(4) Procedures that State agencies must follow in reporting measure
data required under this section.
(5) Identification of the populations for which States must report
the measures identified by the Secretary under paragraph (e) of this
section, which may include, but is not limited to beneficiaries--
(i) Receiving services through specified delivery systems, such as
those enrolled in a managed care plan or receiving services on a fee-
for-service basis;
(ii) Who are dually eligible for Medicare and Medicaid, including
beneficiaries whose medical assistance is limited to payment of
Medicare premiums or cost sharing;
(iii) Who are older adults;
(iv) Who have physical disabilities;
(v) Who have intellectual and development disabilities;
(vi) Who have serious mental illness; and
(vii) Who have other health conditions.
(6) Technical information on attribution rules for determining how
States must report on measures for beneficiaries who are included in
more than one population, as described in paragraph (d)(5) of this
section, during the reporting period.
(7) The subset of measures among the measures in the Home and
Community-Based Services Quality Measure Set that must be stratified by
race, ethnicity, sex, age, rural/urban status, disability, language,
Tribal status, or such other factors as may be specified by the
Secretary and informed by consultation every other year with States and
interested parties in accordance with paragraph (b)(2) and subsection
(g) of this section.
(8) Describe how to establish State performance targets for each of
the measures in the Home and Community-Based Services Quality Measure
Set.
(e) Phasing in of certain reporting. As part of the process that
allows for developing and updating the Home and Community-Based
Services Quality Measure Set described in paragraph (d) of this
section, the Secretary may provide that mandatory State reporting for
certain measures and reporting for certain populations of beneficiaries
will be phased in over a specified period of time, taking into account
the level of complexity required for such State reporting.
(f) Selection of measures for stratification. In specifying which
measures, and by which factors, States must report stratified measures
consistent with paragraph (d)(7) of this section, the Secretary will
take into account whether stratification can be accomplished based on
valid statistical methods and without risking a violation of
beneficiary privacy and, for measures obtained from surveys, whether
the original survey instrument collects the variables necessary to
stratify the measures, and such other factors as the Secretary
determines appropriate; the Secretary will require stratification of 25
percent of the measures in the Home and Community-Based Services
Quality Measure Set for which the Secretary has specified that
reporting should be stratified by 3 years after the effective date of
these regulations, 50 percent of such measures by 5 years after the
effective date of these regulations, and 100 percent of measures by 7
years after the effective date of these regulations.
(g) Consultation with interested parties. For purposes of paragraph
(c)(2) of this section, the Secretary must consult with interested
parties as described in this paragraph to include the following:
(1) State Medicaid Agencies and agencies that administer Medicaid-
covered home and community-based services.
(2) Health care and home and community-based services
professionals, including members of the allied health professions who
specialize in the care and treatment of older adults, children and
adults with disabilities, and individuals with complex medical needs.
(3) Health care and home and community-based services professionals
(including members of the allied health professions), providers, and
direct care workers who provide services to older adults, children and
adults with disabilities, and individuals with complex medical and
behavioral health care needs who live in urban and rural medically
underserved communities or who are members of distinct population sub-
groups at heightened risk for poor outcomes.
(4) Providers of home and community-based services.
(5) Direct care workers and national organizations representing
direct care workers.
(6) Consumers and national organizations representing older adults,
children and adults with disabilities,
[[Page 28085]]
and individuals with complex medical needs.
(7) National organizations and individuals with expertise in home
and community-based services quality measurement.
(8) Voluntary consensus standards setting organizations and other
organizations involved in the advancement of evidence-based measures of
health care.
(9) Measure development experts.
(10) Such other interested parties as the Secretary may determine
appropriate.
0
12. Section 441.313 is added to subpart G to read as follows:
Sec. 441.313 website transparency.
(a) The State must operate a website consistent with Sec.
435.905(b) of this chapter that provides the results of the reporting
requirements specified at Sec. 441.311. The State must:
(1) Include all content on one web page, either directly or by
linking to individual managed care organization, prepaid ambulatory
health plan, prepaid inpatient health plan, and primary care case
management, as defined in part 438, entity websites;
(2) Include clear and easy to understand labels on documents and
links;
(3) Verify no less than quarterly, the accurate function of the
website and the timeliness of the information and links; and
(4) Include prominent language on the website explaining that
assistance in accessing the required information on the website is
available at no cost and include information on the availability of
oral interpretation in all languages and written translation available
in each non-English language, how to request auxiliary aids and
services, and a toll-free and TTY/TDY telephone number.
(b) CMS must report on its website the results of the reporting
requirements specified at Sec. 441.311 that the State reports to CMS.
(c) These requirements are effective 3 years after the date of
enactment of this paragraph; and in the case of the State that
implements a managed care delivery system under the authority of
sections 1915(a), 1915(b), 1932(a), and 1115(a) of the Act and includes
HCBS in the MCO's, PIHP's, or PAHP's contract, the first managed care
plan contract rating period that begins on or after 3 years after the
date of enactment of this paragraph.
0
13. Amend Sec. 441.450 in paragraph (c) by adding, in alphabetical
order, the definition of ``Service plan'' to read as follows:
Sec. 441.450 Basis, scope, and definitions.
* * * * *
(c) * * *
Service plan means the written document that specifies the services
and supports (regardless of funding source) that are to be furnished to
meet the needs of a participant in the self-directed PAS option and to
assist the participant to direct the PAS and to live in the community.
The service plan is developed based on the assessment of need using a
person-centered and directed process. The service plan supports the
participant's engagement in community life and respects the
participant's preferences, choices, and abilities. The participant's
representative, if any, families, friends, and professionals, as
desired or required by the participant, will be involved in the
service-planning process. Service plans must meet the requirements of
Sec. 441.301(c)(3).
* * * * *
0
14. Amend Sec. 441.464 by-
0
a. Revising paragraph (d)(2)(v);
0
b. Redesignating current paragraphs (e) and (f) as paragraphs (g) and
(h); and
0
c. Adding a new paragraphs (e) and (f).
The revisions and additions read as follows:
Sec. 441.464 State assurances.
* * * * *
(d) * * *
(2) * * *
(v) Grievance process, as defined in Sec. 441.301(c)(7) when self-
directed PAS include services under a section 1915(c) waiver program.
* * * * *
(e) Incident management system. The State operates and maintains an
incident management system that identifies, reports, triages,
investigates, resolves, tracks, and trends critical incidents and
adheres to requirements of Sec. 441.302(a)(6).
(f) Payment rates are adequate to ensure a sufficient direct care
workforce to meet the needs of beneficiaries and provide access to
services in the amount, duration, and scope specified in the person-
centered service plan, in accordance with Sec. 441.302(k).
* * * * *
0
15. Amend Sec. 441.474 by adding paragraph (c) to read as follows:
Sec. 441.474 Quality assurance and improvement plan.
* * * * *
(c) The quality assurance and improvement plan must comply with all
components of Sec. Sec. 441.311 and 441.312 and related reporting
requirements relevant to the State's self-directed PAS program.
* * * * *
0
16. Section 441.486 is added to subpart J to read as follows:
Sec. 441.486 website transparency.
For States subject to the requirements of subpart J, the State must
operate a website consistent with Sec. 441.313.
0
17. Amend Sec. 441.540 by revising paragraph (c) to read as follows:
Sec. 441.540 Person-centered service plan.
* * * * *
(c) Reviewing the person-centered service plan. The State must
ensure that the person-centered service plan is reviewed, and revised,
as appropriate, based upon the reassessment of functional need, at
least every 12 months, when the individual's circumstances or needs
change significantly, and at the request of the individual. States must
adhere to the requirements of Sec. 441.301(c)(3).
* * * * *
0
18. Amend Sec. 441.555 by revising paragraph (b)(2)(iv) to read as
follows:
Sec. 441.555 Support system.
* * * * *
(b) * * *
(2) * * *
(iv) Grievance process, as defined in Sec. 441.301(c)(7).
* * * * *
0
19. Amend Sec. 441.570 by adding paragraphs (e) and (f) to read as
follows:
Sec. 441.570 State assurances.
* * * * *
(e) An incident management system in accordance with Sec.
441.302(a)(6) is implemented.
(f) Payment rates are adequate to ensure a sufficient direct care
workforce to meet the needs of beneficiaries and provide access to
services in the amount, duration, and scope specified in the person-
centered service plan, in accordance with Sec. 441.302(k).
0
20. Amend Sec. 441.580 by redesignating paragraph (i) as (j), and
adding a new paragraph (i) to read as follows:
Sec. 441.580 Data collection.
* * * * *
(i) Data and information as required in Sec. 441.311.
* * * * *
0
21. Amend Sec. 441.585 by adding paragraph (d) to read as follows:
Sec. 441.585 Quality assurance system.
* * * * *
(d) The State must implement the Home and Community-Based Services
Quality Measure Set in accordance with Sec. 441.312.
[[Page 28086]]
0
22. Section 441.595 is added to subpart K to read as follows--
Sec. 441.595 website transparency.
For States subject to the requirements of subpart K, the State must
operate a website consistent with Sec. 441.313.
0
23. Amend Sec. 441.725 by revising paragraph (c) to read as follows:
Sec. 441.725 Person-centered service plan.
* * * * *
(c) Reviewing the person-centered service plan. The State must
ensure that the person-centered service plan is reviewed, and revised,
as appropriate, based upon the reassessment of functional need as
required in Sec. 441.720, at least every 12 months, when the
individual's circumstances or needs change significantly, and at the
request of the individual. States must adhere to the requirements of
Sec. 441.301(c)(3).
* * * * *
0
24. Amend Sec. 441.745 by--
0
a. Redesignating paragraph (a)(1)(iii) as paragraph (a)(1)(iv);
0
b. Adding new paragraphs (a)(iii) and (a)(v) through (vii);
0
c. Revising paragraph (b)(1)(i); and
0
d. Adding paragraph (b)(1)(v).
The revision and additions read as follows:
Sec. 441.745 State plan HCBS administration: State responsibilities
and quality improvement.
* * * * *
(a) * * *
(1) * * *
(iii) Grievances. A State must provide individuals with the
opportunity to file a grievance as defined in section Sec.
441.301(c)(7).
* * * * *
(v) A State must implement an incident management system in
accordance with Sec. 441.302(a)(6).
(vi) A State must assure payment rates are adequate to ensure a
sufficient direct care workforce to meet the needs of beneficiaries and
provide access to services in the amount, duration, and scope specified
in the person-centered service plan, in accordance with Sec.
441.302(k).
(vii) A State must assure the submission of data and information as
required in Sec. 441.311.
* * * * *
(b) * * *
(1) * * *
(i) Incorporate a continuous quality improvement process that
includes monitoring, remediation, and quality improvement, including
recognizing and reporting critical incidents, as defined in Sec.
441.302(a)(6)(i)(A).
* * * * *
(v) Implementation of the Home and Community-Based Services Quality
Measure Set in accordance with Sec. 441.312.
* * * * *
0
25. Section Sec. 441.750 is added to subpart M to read as follows--
Sec. 441.750 Website transparency.
For States subject to the requirements of subpart M, the State must
operate a website consistent with Sec. 441.313.
* * * * *
PART 447--PAYMENT FOR SERVICES
0
26. The authority citation for part 447 is revised to read as follows:
Authority: 42 U.S.C. 1302, and 1396r-8, and Pub. L. 111-148.
0
27. Amend Sec. 447.203 by revising paragraph (b) and adding paragraph
(c) to read as follows:
Sec. 447.203 Documentation of access to care and service payment
rates.
* * * * *
(b)(1) Payment rate transparency. The State agency is required to
publish all Medicaid fee-for-service payment rates on a website
developed and maintained by the single State agency that is accessible
to the general public. Published Medicaid fee-for-service payment rates
include fee schedule payment rates made to providers delivering
Medicaid services to Medicaid beneficiaries through a fee-for-service
delivery system. The website where the State agency publishes its
Medicaid fee-for-service payment rates must be easily reached from a
hyperlink on the State Medicaid agency's website. Medicaid fee-for-
service payment rates must be organized in such a way that a member of
the public can readily determine the amount that Medicaid would pay for
the service and, in the case of a bundled or similar payment
methodology, identify each constituent service included within the rate
and how much of the bundled payment is allocated to each constituent
service under the State's methodology. If the rates vary, the State
must separately identify the Medicaid fee-for-service payment rates by
population (pediatric and adult), provider type, and geographical
location, as applicable. The initial publication of the Medicaid fee-
for-service payment rates shall occur no later than January 1, 2026 and
include approved Medicaid fee-for-service payment rates in effect as of
January 1, 2026. The agency is required to include the date the payment
rates were last updated on the State Medicaid agency's website and to
ensure these data are kept current where any necessary update must be
made no later than 1 month following the date of CMS approval of the
State plan amendment, section 1915(c) HCBS waiver amendment, or similar
amendment revising the provider payment rate or methodology. In the
event of a payment rate change that occurs in accordance with a
previously approved rate methodology, the State will update its payment
rate transparency publication no later than 1 month after the effective
date of the most recent update to the payment rate.
(2) Comparative payment rate analysis and payment rate disclosure.
The State agency is required to develop and publish a comparative
payment rate analysis of Medicaid payment rates for each of the
following categories of services in paragraphs (b)(2)(i) through (iii)
of this section and a payment rate disclosure of Medicaid payment rates
for each of the following categories of services in paragraph
(b)(2)(iv) of this section, as specified in paragraph (b)(3) of this
section. If the rates vary, the State must separately identify the
payment rates by population (pediatric and adult), provider type, and
geographical location, as applicable.
(i) Primary care services.
(ii) Obstetrical and gynecological services.
(iii) Outpatient behavioral health services.
(iv) Personal care, home health aide, and homemaker services, as
specified in Sec. 440.180(b)(2) through (4), provided by individual
providers and providers employed by an agency.
(3) Comparative payment rate analysis and payment rate disclosure
requirements. The State agency must develop and publish, consistent
with the publication requirements described in paragraph (b)(1) of this
section for payment rate transparency data, a comparative payment rate
analysis and a payment rate disclosure.
(i) For the categories of services described in paragraph (b)(2)(i)
through (iii) of this section, the comparative payment rate analysis
must compare the State agency's Medicaid fee-for-service payment rates
to the most recently published Medicare payment rates effective for the
same time period for the evaluation and management (E/M) codes
applicable to the category of service. The State must conduct the
comparative payment rate analysis at the Current Procedural Terminology
(CPT) or Healthcare Common Procedure Coding System (HCPCS) code level,
as applicable, using the most current set of codes published by CMS,
and the analysis must meet the following requirements:
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(A) The State must organize the analysis by category of service as
described in paragraphs (b)(2)(i) through (iii) of this section.
(B) The analysis must clearly identify the Medicaid base payment
rates for each E/M CPT/HCPCS code identified by CMS under the
applicable category of service, including, if the rates vary, separate
identification of the payment rates by population (pediatric and
adult), provider type, and geographical location, as applicable.
(C) The analysis must clearly identify the Medicare non-facility
payment rates effective for the same time period for the same set of E/
M CPT/HCPCS codes, and for the same geographical location as the
Medicaid base payment rates, that correspond to the Medicaid base
payment rates identified under paragraph (b)(3)(i)(B) of this section,
including, separate identification of the payment rates by provider
type.
(D) The analysis must specify the Medicaid base payment rate
identified under paragraph (b)(3)(i)(B) of this section as a percentage
of the Medicare non-facility payment rate identified under paragraph
(b)(3)(i)(C) of this section for each of the services for which the
Medicaid base payment rate is published pursuant to paragraph
(b)(3)(i)(B) of this section.
(E) The analysis must specify the number of Medicaid-paid claims
and the number of Medicaid enrolled beneficiaries who received a
service within a calendar year for each of the services for which the
Medicaid base payment rate is published pursuant to paragraph
(b)(3)(i)(B) of this section.
(ii) For each category of services specified in paragraph
(b)(2)(iv) of this section, the State agency is required to publish a
payment rate disclosure that expresses the State's payment rates as the
average hourly payment rates, separately identified for payments made
to individual providers and to providers employed by an agency, if the
rates vary. The payment rate disclosure must meet the following
requirements:
(A) The State must organize the payment rate disclosure by category
of service as specified in paragraph (b)(2)(iv) of this section.
(B) The disclosure must identify the average hourly payment rates
by applicable category of service, including, if the rates vary,
separate identification of the average hourly payment rates for
payments made to individual providers and to providers employed by an
agency, by population (pediatric and adult), provider type, and
geographical location, as applicable.
(C) The disclosure must identify the number of Medicaid-paid claims
and the number of Medicaid enrolled beneficiaries who received a
service within a calendar year for each of the services for which the
average hourly payment rates are published pursuant to paragraph
(b)(3)(ii)(B) of this section.
(4) Comparative payment rate analysis and payment rate disclosure
timeframe. The State agency must publish the initial comparative
payment rate analysis and payment rate disclosure of its Medicaid
payment rates in effect as of January 1, 2025 as required under
paragraphs (b)(2) and (b)(3) of this section, by no later than January
1, 2026. Thereafter, the State agency must update the comparative
payment rate analysis and payment rate disclosure no less than every 2
years, by no later than January 1 of the second year following the most
recent update. The comparative payment rate analysis and payment rate
disclosure must be published consistent with the publication
requirements described in paragraph (b)(1) of this section for payment
rate transparency data.
(5) Compliance with payment rate transparency, comparative payment
rate analysis, and payment rate disclosure requirements. If a State
fails to comply with the payment rate transparency, comparative payment
rate analysis, and payment rate disclosure requirements in paragraphs
(b)(1) through (b)(4) of this section, including requirements for the
time and manner of publication, future grant awards may be reduced
under the procedures set forth at 42 CFR part 430, subparts C and D by
the amount of FFP CMS estimates is attributable to the State's
administrative expenditures relative to the total expenditures for the
categories of services specified in paragraph (b)(2) of this section
for which the State has failed to comply with applicable requirements,
until such time as the State complies with the requirements. Unless
otherwise prohibited by law, deferred FFP for those expenditures will
be released after the State has fully complied with all applicable
requirements.
(6) Interested parties advisory group for rates paid for certain
services. (i) The State agency must establish an advisory group for
interested parties to advise and consult on provider rates with respect
to service categories under the Medicaid State plan, 1915(c) waiver,
and demonstration programs, as applicable, where payments are made to
the direct care workers specified in Sec. 441.302(k)(1)(ii) for the
self-directed or agency-directed services found at Sec. 440.180(b)(2)
through (4).
(ii) The interested parties advisory group must include, at a
minimum, direct care workers, beneficiaries, beneficiaries' authorized
representatives, and other interested parties impacted by the services
rates in question, as determined by the State.
(iii) The interested parties advisory group will advise and consult
with the Medicaid agency on current and proposed payment rates, HCBS
payment adequacy data as required at Sec. 441.311(e), and access to
care metrics described in Sec. 441.311(d)(2), associated with services
found at Sec. 440.180(b)(2) through (4), to ensure the relevant
Medicaid payment rates are sufficient to ensure access to personal
care, home health aide, and homemaker services for Medicaid
beneficiaries at least as great as available to the general population
in the geographic area and to ensure an adequate number of qualified
direct care workers to provide self-directed personal assistance
services.
(iv) The interested parties advisory group shall meet at least
every 2 years and make recommendations to the Medicaid agency on the
sufficiency of State plan, 1915(c) waiver, and demonstration direct
care worker payment rates, as applicable. The State agency will ensure
the group has access to current and proposed payment rates, HCBS
provider payment adequacy minimum performance and reporting standards
as described in Sec. 441.311(e), and applicable access to care metrics
as described in Sec. 441.311(d)(2) for HCBS in order to produce these
recommendations. The process by which the State selects interested
party advisory group members and convenes its meetings must be made
publicly available.
(v) The Medicaid agency must publish the recommendations produced
under paragraph (b)(6)(iv) of the interested parties advisory group
consistent with the publication requirements described in paragraph
(b)(1) of this section for payment rate transparency data, within 1
month of when the group provides the recommendation to the agency.
(c)(1) Initial State analysis for rate reduction or restructuring.
For any State plan amendment that proposes to reduce provider payment
rates or restructure provider payments in circumstances when the
changes could result in diminished access where the criteria in
paragraphs (c)(1)(i) through (iii) of this section are met, the State
agency must provide written assurance and relevant supporting
documentation that the following conditions are met as well as a
description of the State's procedures for monitoring continued
compliance with section 1902(a)(30)(A) of the Act, as part of the State
plan amendment submission in a format
[[Page 28088]]
prescribed by CMS as a condition of approval:
(i) Medicaid payment rates in the aggregate (including base and
supplemental payments) following the proposed reduction or
restructuring for each benefit category affected by the proposed
reduction or restructuring would be at or above 80 percent of the most
recently published Medicare payment rates for the same or a comparable
set of Medicare-covered services.
(ii) The proposed reduction or restructuring, including the
cumulative effect of all reductions or restructurings taken throughout
the current State fiscal year, would be likely to result in no more
than a 4 percent reduction in aggregate fee-for-service Medicaid
expenditures for each benefit category affected by proposed reduction
or restructuring within a State fiscal year.
(iii) The public processes described in paragraph (c)(4) of this
section and Sec. 447.204 of this part yielded no significant access to
care concerns from beneficiaries, providers, or other interested
parties regarding the service(s) for which the payment rate reduction
or payment restructuring is proposed, or if such processes did yield
concerns, the State can reasonably respond to or mitigate the concerns,
as appropriate, as documented in the analysis provided by the State
pursuant to Sec. 447.204(b)(3).
(2) Additional State rate analysis. For any State plan amendment
that proposes to reduce provider payment rates or restructure provider
payments in circumstances when the changes could result in diminished
access where the requirements in paragraphs (c)(1)(i) through (iii) of
this section are not met, the State must also provide the following to
CMS as part of the State plan amendment submission as a condition of
approval, in addition to the information required under paragraph
(c)(1) of this section, in a format prescribed by CMS:
(i) A summary of the proposed payment change, including the State's
reason for the proposal and a description of any policy purpose for the
proposed change, including the cumulative effect of all reductions or
restructurings taken throughout the current State fiscal year in
aggregate fee-for-service Medicaid expenditures for each benefit
category affected by proposed reduction or restructuring within a State
fiscal year.
(ii) Medicaid payment rates in the aggregate (including base and
supplemental payments) before and after the proposed reduction or
restructuring for each benefit category affected by proposed reduction
or restructuring, and a comparison of each (aggregate Medicaid payment
before and after the reduction or restructuring) to the most recently
published Medicare payment rates for the same or a comparable set of
Medicare-covered services and, as reasonably feasible, to the most
recently available payment rates of other health care payers in the
State or the geographic area for the same or a comparable set of
covered services.
(iii) Information about the number of actively participating
providers of services in each benefit category affected by the proposed
reduction or restructuring. For this purpose, an actively participating
provider is a provider that is participating in the Medicaid program
and actively seeing and providing services to Medicaid beneficiaries or
accepting Medicaid beneficiaries as new patients. The State must
provide the number of actively participating providers of services in
each affected benefit category for each of the 3 years immediately
preceding the State plan amendment submission date, by State-specified
geographic area (for example, by county or parish), provider type, and
site of service. The State must document observed trends in the number
of actively participating providers in each geographic area over this
period. The State may provide estimates of the anticipated effect on
the number of actively participating providers of services in each
benefit category affected by the proposed reduction or restructuring,
by geographic area.
(iv) Information about the number of Medicaid beneficiaries
receiving services through the FFS delivery system in each benefit
category affected by the proposed reduction or restructuring. The State
must provide the number of beneficiaries receiving services in each
affected benefit category for each of the 3 years immediately preceding
the State plan amendment submission date, by State-specified geographic
area (for example, by county or parish). The State must document
observed trends in the number of Medicaid beneficiaries receiving
services in each affected benefit category in each geographic area over
this period. The State must provide quantitative and qualitative
information about the beneficiary populations receiving services in the
affected benefit categories over this period, including the number and
proportion of beneficiaries who are adults and children and who are
living with disabilities, and a description of the State's
consideration of the how the proposed payment changes may affect access
to care and service delivery for beneficiaries in various populations.
The State must provide estimates of the anticipated effect on the
number of Medicaid beneficiaries receiving services through the FFS
delivery system in each benefit category affected by the proposed
reduction or restructuring, by geographic area.
(v) Information about the number of Medicaid services furnished
through the FFS delivery system in each benefit category affected by
the proposed reduction or restructuring. The State must provide the
number Medicaid services furnished in each affected benefit category
for each of the 3 years immediately preceding the State plan amendment
submission date, by State-specified geographic area (for example, by
county or parish), provider type, and site of service. The State must
document observed trends in the number of Medicaid services furnished
in each affected benefit category in each geographic area over this
period. The State must provide quantitative and qualitative information
about the Medicaid services furnished in the affected benefit
categories over this period, including the number and proportion of
Medicaid services furnished to adults and children and who are living
with disabilities, and a description of the State's consideration of
the how the proposed payment changes may affect access to care and
service delivery. The State must provide estimates of the anticipated
effect on the number of Medicaid services furnished through the FFS
delivery system in each benefit category affected by the proposed
reduction or restructuring, by geographic area.
(vi) A summary of, and the State's response to, any access to care
concerns or complaints received from beneficiaries, providers, and
other interested parties regarding the service(s) for which the payment
rate reduction or restructuring is proposed as required under Sec.
447.204(a)(2).
(3) Compliance with requirements for State analysis for rate
reduction or restructuring. A State that submits a State plan amendment
that proposes to reduce provider payment rates or restructure provider
payments in circumstances when the changes could result in diminished
access that fails to provide the information and analysis to support
approval as specified in paragraphs (c)(1) and (2) of this section, as
applicable, may be subject to State plan amendment disapproval under
Sec. 430.15(c) of this chapter. Additionally, States that submit
relevant information, but where there are unresolved access to care
concerns related to the proposed
[[Page 28089]]
State plan amendment, including any raised by CMS in its review of the
proposal and any raised through the public process as specified in
paragraph (c)(4) of this section or under Sec. 447.204(a)(2), may be
subject to State plan amendment disapproval. If State monitoring of
beneficiary access after the payment rate reduction or restructuring
takes effect shows a decrease in Medicaid access to care, such as a
decrease in the provider-to-beneficiary ratio for any affected service,
or the State or CMS experiences an increase in beneficiary or provider
complaints or concerns about access to care that suggests possible
noncompliance with the access requirements in section 1902(a)(30)(A) of
the Act, CMS may take a compliance action using the procedures
described in Sec. 430.35 of this chapter.
(4) Mechanisms for ongoing beneficiary and provider input. (i)
States must have ongoing mechanisms for beneficiary and provider input
on access to care (through hotlines, surveys, ombudsman, review of
grievance and appeals data, or another equivalent mechanisms),
consistent with the access requirements and public process described in
Sec. 447.204.
(ii) States should promptly respond to public input through these
mechanisms citing specific access problems, with an appropriate
investigation, analysis, and response.
(iii) States must maintain a record of data on public input and how
the State responded to this input. This record will be made available
to CMS upon request.
(5) Addressing access questions and remediation of inadequate
access to care. When access deficiencies are identified, the State
must, within 90 days after discovery, submit a corrective action plan
with specific steps and timelines to address those issues. While the
corrective action plan may include longer-term objectives, remediation
of the access deficiency should take place within 12 months.
(i) The State's corrective actions may address the access
deficiencies through a variety of approaches, including, but not
limited to: Increasing payment rates, improving outreach to providers,
reducing barriers to provider enrollment, providing additional
transportation to services, providing for telemedicine delivery and
telehealth, or improving care coordination.
(ii) The resulting improvements in access must be measured and
sustainable.
(6) Compliance actions for access deficiencies. To remedy an access
deficiency, CMS may take a compliance action using the procedures
described at Sec. 430.35 of this chapter.
0
28. Amend Sec. 447.204 by--
0
a. Revising paragraphs (a)(1) and (b); and
0
b. Removing paragraph (d).
The revisions read as follows:
Sec. 447.204 Medicaid provider participation and public process to
inform access to care.
(a) * * *
(1) The data collected, and the State analysis performed, under
Sec. 447.203(c).
* * * * *
(b) The State must submit to CMS with any such proposed State plan
amendment affecting payment rates documentation of the information and
analysis required under Sec. 447.203(c) of this chapter.
* * * * *
Dated: April 24, 2023.
Xavier Becerra,
Secretary, Department of Health and Human Services.
[FR Doc. 2023-08959 Filed 4-27-23; 4:15 pm]
BILLING CODE 4120-01-P