In the first update to federal MCO rules in more than a decade, the government is set to push a range of tweaks, reforms and requirements that could set a new baseline for a bustling public payer segment.
Some 40 million of the 70 million and growing Medicaid beneficiaries are covered in managed care plans, and most of them are in risk-based MCOs, with capitation payments accounting for almost 30 percent of Medicaid spending nationally as of fiscal 2013, before the Affordable Care Act's Medicaid expansion.
Now, with all of that growing thanks to the ACA eligibility expansion and with states driving much of the policy, the Centers for Medicare & Medicaid Services is looking to have at least a baseline of quality and oversight nationally.
Due soon, this spring or summer, is the agency's first update since 2002. Those regulations laid out MCO requirements for beneficiary rights and protections, quality assessments, provider access standards, appeals, and sanctions.
There are lingering issues and new ones, though, that CMS believes need to be addressed. Among them are rate-setting, beneficiary protections, transitions between Medicaid, public exchange plans are Medicare Advantage, and managed long-term care.
"CMS will likely seek to strike a balance between strengthening federal standards and avoiding rules that are too prescriptive to account for diverse Medicaid programs and markets or that pose barriers to desirable state innovation," write policy analysts Julia Paradise and MaryBeth Musumeci, in a Kaiser Family Foundation report.
Beneficiary information and protections
CMS will certainly be addressing the issue of information, Paradise and Musumeci said. For one thing, the regulations could include new requirements on the clarity and accessibility of information, such as mandated Internet access to provider directories and medications--as exchange plans must do. "CMS also could include additional state oversight requirements and require plans to report on accessibility measures for people with disabilities, to strengthen plan and provider compliance with the ADA and Section 504 of the Rehabilitation Act," Paradise and Musumeci wrote.
The new regulations might adopt more stringent processes for enrollment and choices of plans. "For example, the new rule could require states to offer independent options counseling to assist beneficiaries making enrollment decisions with this often complex and unfamiliar process," Paradise and Musumeci wrote.
There's also the possibility of requirements for "intelligent assignment" algorithms that preserve continuity of access to providers and services for beneficiaries who are defaulting to plans. (Disruption of long-time doctor-patient relationships has been a major concern and source of backlash in California's Medicaid-Medicare dual eligible demonstration.)
Network adequacy
There's been a fair amount of concern about network adequacy with MCOs across the country, Paradise and Musumeci note. One recent study by the HHS Inspector General found that while all 33 states with Medicaid managed care have quantitative provider access standards, only a few states actually test access directly with the "secret shopper" method. A companion study found "widespread" inaccuracies in MCOs' provider directories and wait-times that exceeded one month in more than 25 percent of providers that were accepting Medicaid plans.
The new regulations could address these issues in a few ways. They could "require states and MCOs to ensure that provider directories are corrected and updated in a timely manner as providers' participation status changes," instead of on an annual basis, Paradise and Musumeci wrote.
One change some patient advocacy groups want to see is a requirement for states to collect data on provider network oversight and share the data with CMS, to have a national picture of the issue. CMS "could establish specific requirements for state and plan monitoring of provider availability, such as quarterly reporting by MCOs to states and the public, online and in written form, on the number, type, location, and current capacity of the providers in their networks providers," Paradise and Musumeci wrote. "Timeliness standards could be established for state action when access problems are identified, and a system of recourse for beneficiaries who cannot gain needed access to providers could be required of states."
Capitation
Federal law requires that capitation rates for MCOs be "actuarially sound," but that hasn't always been enforced. A 2010 Government accountability report found that limited and inconsistent CMS oversight of state rate-setting, with data quality being a particular problem in plans covering complex patient populations.
Since then, CMS has issued "consultation guides" to states about best practices, and there have been efforts by both MCOs and patient advocates to increase transparency and accountability in state rate-setting processes.
The new regulations "could codify standards and requirements that are described in the consultation guides or strengthen those requirements by, for example, establishing standards regarding the transparency of the rate-setting process," Paradise and Musumeci wrote.
CMS "could also seek to increase state accountability in this area, for example, by requiring states to conduct routine examinations of the effect of capitation payment rates on beneficiary access to care or establishing a process by which MCOs, providers, and beneficiaries can raise concerns about states' capitation rates, which might trigger CMS review and possible adjustments."
Quality
While CMS has a set of core quality measures for children and adults in Medicaid and a standardized reporting for states, the federal regulations don't mandate any specific quality measures for states to use, and some patient advocates argue that standardized reporting on at least a few specific quality measures would allow for meaningful comparisons across plans and states.
This is another area where the feds could step in. "CMS could propose that MCOs and states report on a standardized set of measures, such as those common to both HHS's pediatric and adult core quality measures and the Medicaid Healthcare Effectiveness Data and Information Set (HEDIS) measures that many states currently require," Paradise and Musumeci wrote.
"In light of the expansion of Medicaid managed care to include more special-needs populations, including individuals with disabilities, beneficiaries with LTSS needs, and people with behavioral health conditions, the proposed rule could also require that, in developing quality measurement and reporting strategies, states consider the needs of these populations and specify the factors that states must take into account."
Managed long-term services and supports
Speaking of LTSS: Medicaid spending on long-term care hovers around $150 billion, covering more than half of long-term care costs in the U.S. and accounting for close to 30 percent of Medicaid outlays. With more states turning to MCOs to take on the growing LTSS demand, it's another area that the feds may address, according to Paradise and Musumeci.
"MCOs may lack experience serving beneficiary groups with more complex needs and those who self-direct their services," and the shift risks "disrupting beneficiaries' existing care arrangements," Paradise and Musumeci wrote. "Therefore, some additional beneficiary protections specifically related to MLTSS may be appropriate."
In 2013, CMS did offer some MTLSS guidance on best practices, and this could be a chance to codify them.
CMS "could require states or MCOs to allow enrollees to disenroll or change MCOs if their LTSS providers leave the MCO network, if there is jeopardy to the beneficiary's living arrangements or employment," Paradise and Musumeci wrote.
States and MCOs could be required to have a transition period during which new MCO enrollees can continue with their existing LTSS providers or previously authorized services. "To help beneficiaries understand their options and rights, choose among MCOs, enroll and disenroll, access services, and navigate grievance and appeals processes, and also to identify systemic problems in MLTSS programs, the rule could require states to provide for the services of independent ombudsman," Paradise and Musumeci added. "Some states already have managed care ombudsman programs, and the capitated financial alignment demonstrations for beneficiaries dually eligible for Medicare and Medicaid include them."