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MedicaidHealth and Health Care

New Regulations Take on the Long-Standing Problem of Access to Services in Medicaid Programs

May 17, 2023


Medicaid access has long been identified as a weakness of the Medicaid and Children’s Health Insurance programs. A number of new regulations released by the federal Centers for Medicare & Medicaid Services aim to improve access to care. The rules make changes to both fee-for-service and managed care systems, with additional provisions to advance health equity and improve home and community-based services.

The federal Centers for Medicare & Medicaid Services (CMS)has released a number of new regulations aimed at improving the Medicaid and Children’s Health Insurance programs. A pair of rules issued last week – Ensuring Access to Medicaid Services and Managed Care Access, Finance, and Quality Management – take on the long-standing problem of access to services in Medicaid programs. The rules make changes to both fee-for-service (FFS) and managed care systems, with additional provisions to advance health equity and improve home and community-based services (HCBS).

Medicaid access has long been identified as a weakness of the program, so agency action to address this problem is welcome. Some background: neither the states nor the federal government provide Medicaid services directly. Rather, federal Medicaid funds are provided to states to cover a portion (at least half) of the cost of services. The states either contract directly with providers, in a fee-for-service (FFS) model, or make a per-member-per-month payment to managed care plans. The federal government does not set rates. Instead, the Medicaid Act requires that states set FFS rates in an amount sufficient to enlist enough providers to ensure beneficiaries have access to covered care. Medicaid managed care plans must set rates that are actuarially sound and ensure access to all services covered under the contract.  More than two-thirds (72 percent) of Medicaid beneficiaries are enrolled in comprehensive managed care plans that accept capitated payments in exchange for covering services.

For years, beneficiaries, advocates, and providers have complained that Medicaid rates are simply too low to guarantee an adequate supply of providers and that Medicaid managed care networks don’t include enough providers to provide needed care.  For many years, advocates and providers had sued state agencies to challenge inadequate payment rates.  But, in 2015, the Supreme Court issued a decision that made it essentially impossible to bring such lawsuits, eliminating a powerful tool for improving rates and access.

That same year, CMS attempted to address the rates problem by requiring states to complete access monitoring review programs to inform state policies governing rates. Now, with the proposed rule, CMS is beefing up these requirements, apparently betting that increased transparency, improved data and monitoring, and opportunities for beneficiary engagement will improve rates and increase access to services. If these regulations are finalized, states would be required to:

  • publish and update FFS payment rates on an accessible, user-friendly website;
  • publish annual analyses comparing Medicare and Medicaid rates for services including OB/GYN, primary care, and outpatient behavioral health in both FFS and managed care;
  • publish the average hourly rate paid to direct care workers providing HCBS; and ensure that states demonstrate that any reduction in rates would not put access to care at risk.

        The rule also requires that at least 80 percent of Medicaid payments for personal care, homemaker and home health aide services go directly to wages (not overhead). CMS also proposes to strengthen managed care network adequacy requirements to ensure that beneficiaries enrolled in managed care plans are able to find providers in their network. To this end, the agency added a requirement that states set standard for maximum wait times for appointments.

        It remains to be seen whether these steps will actually bring about necessary change in provider access. One thing is certain, however – there will be much more accessible information about payment than there is now.

        These rules address a number of other aspects of the program, including expanding authority of and beneficiary participation in Medicaid Advisory Committees and imposing more requirements for transparency and access to that committee, including for people with limited English proficiency. They also strengthen requirements for providing home and community-based services, imposing specific requirements for preparing person-centered plans.

        CMS has opened a comment period on these rules – the public has until July 3 to submit comments. For more information, see this summary from CMS and this one, from the National Health Law Program.

        This post was written by Sarah Somers, J.D., M.P.H., Legal Director – Southeastern Region, Network for Public Health Law.

        The Network for Public Health Law provides information and technical assistance on issues related to public health. The legal information and assistance provided in this document do not constitute legal advice or legal representation. For legal advice, readers should consult a lawyer in their state.

        Support for the Network is provided by the Robert Wood Johnson Foundation (RWJF). The views expressed in this post do not represent the views of (and should not be attributed to) RWJF.