What’s happening: The Centers for Medicare & Medicaid Services (CMS) finalized the Medicaid and Children’s Health Insurance Program Managed Care Access, Finance, and Quality rule.
What else to know: The rule finalizes significant changes and clarifications regarding managed care delivery and finance.
Finalized policies include:
- Hold Harmless Attestation: For state directed payments (SDPs) funded by health care-related taxes starting Jan. 1, 2028, CMS finalized a provision requiring states to ensure participating providers attest they do not participate in “hold harmless” arrangements. The rule clarifies CMS will not necessarily deny approval for an SDP program if one or more providers does not sign the attestation, depending on the reasons for not doing so. CMS concurrently announced (via informational bulletin) that they would delay enforcement against existing hold harmless arrangements involving redistribution of Medicaid payments, including SDPs, until Jan. 1, 2028.
- Network Requirement: Removes requirement that providers must be in-network with managed care plans to receive SDPs. However, the rule does not require non-network providers to be eligible for SDPs leaving it up to states on whether network status is required.
- Average Commercial Rates (ACRs): Caps total payment levels received from managed care plans, inclusive of SDPs, at ACRs for inpatient/outpatient hospital services, nursing facilities, and academic medical center professional services. Relatedly, CMS declined to finalize any aggregate expenditure limit on SDP programs more generally.
- Separate Payment Terms: By the first rating period on or after July 9, 2027, the rule prohibits the use of “separate payment terms” and requires that all SDPs be included in actuarially sound capitation rates upon submission of rate certifications. Thereby, this limits the flexibility and timelines states have to make rate adjustments to account for SDPs once the rate year has begun.
- Appointment Wait Times: Establishes maximum wait times for primary care, obstetric services, and outpatient mental health and substance use disorder services.
- Network Adequacy: Requires states to implement a remedy plan for any managed care organization that fails to meet required access standards.
A CMS fact sheet is available. CHA will make a detailed summary available shortly.
