On March 22, 2018, the Centers for Medicare and Medicaid Services (CMS) announced a notice of proposed rulemaking (NPRM) that would, if finalized, exempt states with high rates of Medicaid beneficiaries in managed care plans from monitoring and reporting requirements related to Medicaid service access set forth in 42 C.F.R. §§ 447.203 and 447.204. The regulations currently require states to analyze and document the impact of Medicaid fee-for-service (FFS) payment amounts on beneficiary access to covered health care services in access monitoring review plans (AMRPs) submitted to CMS.

States’ AMRPs must, using a data-driven process, address the impact of Medicaid FFS payments on beneficiaries’ access to the following categories of Medicaid services: primary care services, physician specialist services, behavioral health services, pre- and post-natal obstetric services, and home health. The state must update and submit the AMRP related to these service categories to CMS at least every three years. If a state reduces Medicaid FFS rates for services outside of these categories, the state must include those additional services in the AMRP and publicly monitor the rate reductions for three years.

Since the adoption of these requirements, several states have complained that the scheme imposes an undue administrative burden and that it is not an efficient use of limited state program resources. In response, the proposed rule’s changes to the regulations would allow the following:

  • An exemption from most access monitoring requirements for states with an overall Medicaid managed care penetration rate of 85% or greater (currently, 17 States).
  • An exemption from the specific access analysis for reductions to provider payments below the “nominal payment rate change” of 4% in overall service category spending during a state fiscal year (and 6% over two consecutive years).
  • A state to submit an assurance that its baseline data “indicates current access is consistent with requirements of the Social Security Act,” rather than be required to predict the effects of proposed Medicaid FFS rate reductions or restructurings on access to care.

This NPRM aligns with the Trump Administration’s push to “cut the red tape” and to generally reduce states’ administrative burdens under federal programs. The proposed changes are also consistent with CMS’s other efforts to enable states to focus on patient outcomes rather than processes in administering their Medicaid programs, as quantified in the agency’s estimates that the proposed changes will eliminate 561 administrative hours and save a total of $1.66 million for the affected states.

Comments on the proposed rule are due to CMS no later than May 22, 2018.

On Tuesday, February 20, Department of Health and Human Services (HHS) Secretary Alex Azar announced that the agency intends to expand access to short-term, low-cost insurance policies. On Wednesday, HHS published its proposed rule, which promises to reduce restrictions on such limited-duration policies. The short-term insurance plans have fewer benefits and more limited consumer protections as compared to those proscribed by the Patient Protection and Affordable Care Act (ACA). While such short-term plans currently can only be carried for 90 days, the new proposal would extend that maximum coverage period to one year.

The proposed rule is in response to President Trump’s Executive Order from October 12, 2017, which called for HHS to expand access to low-cost insurance plans. The Executive Order asked the agency to explore the possibility of extending the maximum duration of such short-term, limited-duration plans in order to increase options for consumers. The short-term insurance plans are contemplated for individuals who are unemployed, between jobs, or otherwise looking to reduce premium costs for up to one year. The plans do not have to meet ACA requirements. Notably, they do not have to cover individuals with pre-existing conditions and they do not have to cover prescription drug plans. The plans offer more limited coverage for consumers, but impose less immediate financial burden through reduced premium cost. Insurers who sell the short-term plans would need to include clear statements on applications and plan documents that the coverage does not meet ACA requirements.

The proposed rule continues the Trump administration’s efforts to roll back the ACA and minimize its economic burden and comes just over a year after the president issued an Executive Order laying out that goal. It comes on the heels of earlier rules from the administration geared at stabilizing the individual and small group insurance markets. It also follows the signing of the new tax reform bill, which repeals the individual mandate of Section 5000A of the Tax Code and eliminates the shared responsibility payment for failure to obtain health insurance starting in 2019.

Continue Reading Azar Rolls Out Expansion of Short-Term, Limited-Duration Insurance Plans