CMS Proposes Revisions to Medicaid Managed Care Rules

Recently, on June 1, the Center for Medicare & Medicaid Services (CMS) published its long anticipated Medicaid managed care proposed rules. This is the first time CMS proposed revisions to the Medicaid managed care regulations since 2002. The proposed rules includes several measures intended by CMS “to modernize the Medicaid managed care regulatory structure in order to facilitate and support delivery system reform initiatives to improve health outcomes and the beneficiary experience, while effectively managing costs.” Among other things, the proposed rule would make a number of changes designed to align Medicaid managed care operating standards with those used in other markets.

For example, the proposed rule includes modifications to the current regulations governing the grievance and appeals systems for Medicaid managed care. The goal is to further align and increase uniformity in the grievance and appeals systems with Medicare Advantage managed care plans and private health insurance and group health plans in order to make the process more consistent across markets. Of particular note, most capitated, risk-bearing forms of Medicaid managed care–whether full or partial risk–would be expected to offer an internal appeals process with specified time frames, with external appeal to the state Medicaid fair hearing process in the event of an adverse determination. The rule would introduce new appeals timeframes, timeframes for plan compliance with favorable beneficiary rulings, and would clarify the right of beneficiaries to introduce new evidence at each stage of appeal.

In addition, the proposed rule would require all states to offer a 60-day time period to request external review through a fair hearing (some states now allow a far shorter time period) and would clarify members’ right to their case file, medical records, and other documents such as the plan documents used to conduct coverage determinations. The expedited appeal time frame would be tightened, as would notice and recordkeeping requirements. Simultaneously, the proposed rule would also require beneficiaries to exhaust internal appeals procedures before seeking a state fair hearing. This is a significant change since some states now allow beneficiaries to bypass the internal process.

Wachler & Associates represents healthcare providers and suppliers in a variety of healthcare law matters, including Medicaid audits and appeals. We will continue to monitor the Medicare & Medicaid Services (CMS) Proposed Rule and other developments in Medicaid. If you or your healthcare entity have any questions regarding Medicaid audits or appeals, please contact an experienced healthcare attorney at 248-544-0888 or via email at wapc@wachler.com. Subscribe to our health law blog to stay updated on the latest CMS news.