Proposed Rule on Medicaid/CHIP Managed Care and Network Standards
On November 8, the Centers for Medicare & Medicaid Services (CMS) issued a Notice of Proposed Rule Making (NPRM) (proposed rule) to amend the 2016 managed care final rule issued by the Obama administration.  The new proposed rule was created with the input of a working group of state Medicaid Directors. Among other things, the extensive 2016 rule required states to establish time and distance standards for managed care networks. As explained in a CMS Fact Sheet, the new proposed rule would give states “more flexibility to set meaningful network adequacy standards using quantitative standards that can take into account new service delivery models like telehealth.” States would also have the authority to define “specialists” “in the most appropriate way for their programs.” Among other objectives, the proposed rule is intended to make it easier for states to transition new services and populations into managed care. Comments are due January 14, 2019, and can be submitted through

Waivers of Current Medicaid Restrictions on Inpatient Treatment for Mental Illness 
In a November 13 speech to the National Association of Medicaid Directors, Secretary of Health and Human Services Alex Azar announced that the administration would be issuing a State Medicaid Directors letter outlining how states can apply for waivers of the long-standing restrictions on Medicaid reimbursement for care provided in “institutions for mental disease” (IMDs). The objective of this policy is to expand the availability of inpatient treatment for adults with a serious mental illness or children with a serious emotional disturbance.  Azar noted that the letter “will strongly emphasize that inpatient treatment is just one part of what needs to be a complete continuum of care, and participating states will be expected to take action to improve community-based mental health care.” Read the press release; read the letter, SMD # 18–011 RE: Opportunities to Design Innovative Service Delivery Systems for Adults with a Serious Mental Illness or Children with a Serious Emotional Disturbance.  See also More leeway for states to expand inpatient mental health (ABC News/Associated Press, 11/13/18).

Value-Based Payments for Drugs
In a November 14 speech to the Biopharma conference, Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma announced that CMS was approving a proposal from Michigan to allow the state’s Medicaid program to enter into value-based payment arrangements with drug manufacturers.  Previously, CMS approved a similar waiver for Oklahoma. According to Ms. Verma, “Michigan’s waiver will empower the state to demand results from drug manufacturers in exchange for paying for medicines.”

Medicaid § 1115 Waivers

Medicaid Advisory Commission Urges Pause in Arkansas Disenrollments and Changes to Waiver Considerations
In a November 8 letter, the congressionally established Medicaid and CHIP Payment and Access Commission (MACPAC) expressed significant concern about the number of people being disenrolled from Medicaid in Arkansas as a result of the state’s “community-engagement” requirement, which requires many Medicaid beneficiaries to work, volunteer, or pursue education as a condition of eligibility. That requirement was established under a §1115 waiver from the Centers for Medicare and Medicaid Services (CMS). In its letter, MACPAC urges the administration to “pause” Arkansas disenrollments so that federal and state officials can make program adjustments to promote beneficiary awareness, reporting, and compliance. MACPAC also suggests that, before approving any future community-engagement waivers, CMS establish mechanisms for effective evaluation and monitoring, and require states to provide adequate lead time for implementing community-engagement requirements. See Federal panel warns of people losing health coverage in Arkansas from work requirement (The Hill, 11/8/18); MACPAC urges Azar to pause, re-evaluate Arkansas’ Medicaid work requirements (FierceHealthcare, 11/9/18).

Medicaid Resources

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