Medicaid Program; Methods for Assuring Access to Covered Medicaid Services, 26342-26362 [2011-10681]

Agencies

• Centers for Medicare & Medicaid Services
• DEPARTMENT OF HEALTH AND HUMAN SERVICES

[Federal Register Volume 76, Number 88 (Friday, May 6, 2011)]
[Proposed Rules]
[Pages 26342-26362]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-10681]



[[Page 26341]]

Vol. 76

Friday,

No. 88

May 6, 2011

Part II





Department of Health and Human Services





-----------------------------------------------------------------------



 Centers for Medicare & Medicaid Services



-----------------------------------------------------------------------



42 CFR Part 447



 Medicare Program; Methods for Assuring Access to Covered Medicaid 
Services; Proposed Rule

Federal Register / Vol. 76 , No. 88 / Friday, May 6, 2011 / Proposed 
Rules

[[Page 26342]]


-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 447

[CMS 2328-P]
RIN 0938-AQ54


Medicaid Program; Methods for Assuring Access to Covered Medicaid 
Services

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This proposed rule would create a standardized, transparent 
process for States to follow as part of their broader efforts to 
``assure that payments are consistent with efficiency, economy, and 
quality of care and are sufficient to enlist enough providers so that 
care and services are available under the plan at least to the extent 
that such care and services are available to the general population in 
the geographic area'' as required by section 1902(a)(30)(A) of the 
Social Security Act (the Act). This proposed rule would also recognize, 
as States have requested, electronic publication as an optional means 
of communicating State plan amendments (SPAs) proposed rate-setting 
policy changes to the public.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. July 5, 2011.

ADDRESSES: In commenting, please refer to file code CMS-2328-P. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to https://www.regulations.gov. Follow the ``Submit a 
comment'' instructions.
    2. By regular mail. You may mail written comments to the following 
address only: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-2328-P, P.O. Box 8016, 
Baltimore, MD 21244-8016. Please allow sufficient time for mailed 
comments to be received before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address only: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-2328-P, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    4. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments before the close of the comment period 
to either of the following addresses:
    a. For delivery in Washington, DC--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Room 445-G, Hubert 
H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 
20201.
    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without Federal Government 
identification, commenters are encouraged to leave their comments in 
the CMS drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain a proof of filing 
by stamping in and retaining an extra copy of the comments being 
filed.)
    b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.
    If you intend to deliver your comments to the Baltimore address, 
please call telephone number (410) 786-7195 in advance to schedule your 
arrival with one of our staff members.
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and received after the comment 
period.
    Submission of comments on paperwork requirements. You may submit 
comments on this document's paperwork requirements by following the 
instructions at the end of the ``Collection of Information 
Requirements'' section in this document.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Jeremy Silanskis, (410) 786-1592.

SUPPLEMENTARY INFORMATION: Inspection of Public Comments: All comments 
received before the close of the comment period are available for 
viewing by the public, including any personally identifiable or 
confidential business information that is included in a comment. We 
post all comments received before the close of the comment period on 
the following Web site as soon as possible after they have been 
received: https://www.regulations.gov. Follow the search instructions on 
that Web site to view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1-800-743-3951.

I. Background

A. General Information

    Title XIX of the Social Security Act (the Act) authorizes the 
Secretary of the Department of Health and Human Services (the 
Secretary) to provide grants to States to help finance programs 
furnishing medical assistance (State Medicaid programs) to specified 
groups of eligible individuals in accordance with an approved State 
plan. ``Medical Assistance'' is defined at section 1905(a) of the Act 
as payment for part or all of the cost of a list of specified care and 
services, or the care and services themselves, or both.
    Federal law provides a broad framework for State Medicaid programs, 
within which States have considerable flexibility. Details concerning 
the scope of covered services, the groups of eligible individuals, the 
payment methodologies for covered services, and all other information 
necessary to assure that the plan can be a basis for Federal Medicaid 
funding must be set forth in the approved Medicaid State plan. To be 
approved by the Department of Health and Human Services, the Medicaid 
State plan must comply with requirements set forth in section 1902(a) 
of the Act, as implemented and interpreted in applicable regulations 
and guidance issued by CMS. The Secretary has delegated overall 
authority for the Federal Medicaid program, including State plan 
approval, to CMS.
    Medicaid services are jointly funded by the Federal and State 
governments in accordance with section 1903(a) of the Act. Section 
1903(a)(1) of the Act provides for payments to States of a percentage 
of expenditures under the approved State plan for covered medical 
assistance. For general medical assistance, the ``Federal medical 
assistance percentage'' (FMAP) varies among the States based on a 
formula set forth in section 1905(b) of the Act that takes into 
consideration State specific information under a formula set forth in 
section 1905(b) of the Act. Beginning in 2014, the Federal Government 
will assume all or a higher share of costs for certain beneficiaries 
made eligible under the Patient Protection and Affordable Care Act of 
2010, (Pub. L.

[[Page 26343]]

111-148, enacted March 23, 2010) (the Affordable Care Act).
    The Medicaid statute requires that States provide coverage to 
certain groups of individuals, and also requires that such coverage 
include certain minimum benefits. In addition, States may elect to 
cover other populations and benefits. In order to give meaning to 
coverage requirements and options, beneficiaries must have meaningful 
access to the health care items and services that are within the scope 
of the covered benefits, as required by section 1902(a)(30)(A) of the 
Act. Many factors affect whether beneficiaries have access to Medicaid 
services, including but not limited to, the beneficiaries' health care 
needs and characteristics, State or local service delivery models, 
procedures for enrolling and reimbursing qualified providers, the 
availability of providers in the community, and Medicaid service 
payment rates to providers.
    States have broad flexibility under the Act to establish service 
delivery systems for covered health care items and services, to design 
the procedures for enrolling providers of such care, and to set the 
methods for establishing provider payment rates. For instance, many 
States provide medical assistance primarily through capitated managed 
care arrangements, while others use fee-for-service payment 
arrangements (with or without primary care case management). 
Increasingly, States are developing service delivery models that 
emphasize medical homes, health homes, or broader integrated care 
delivery systems to provide and coordinate medical services. The 
delivery system design and accompanying payment methodologies can 
significantly shape beneficiaries' abilities to access needed care by 
facilitating the availability of such care. In addition, the delivery 
system model and payment methodologies can improve access to care by 
making available care management teams, physician assistants, community 
care coordinators, telemedicine and telehealth, nurse help lines, 
health information technology and other methods for providing 
coordinated care and services and support in a setting and timeframe 
that meet beneficiary needs.
    As State delivery system models have evolved, so too have their 
provider payment systems. Many States develop rates based on the costs 
of providing the service, a review of the amount paid by commercial 
payers in the private market, or as a percentage of rates paid under 
the Medicare program for equivalent services. Often, rates are updated 
based on specific trending factors such as the Medicare Economic Index 
or a Medicaid trend factor that incorporates a State-determined 
inflation adjustment rate. Rates may include supplemental or incentive 
payments that encourage providers to serve Medicaid populations. For 
instance, some States have authorized Medicaid providers to receive 
supplemental payments for care coordination and care management, or for 
achieving certain specified quality measures.
    The flexibility in designing service delivery systems and provider 
payment methodologies, as described above, is consistent with the 
requirement in section 1902(a)(30)(A) of the Act that State Medicaid 
plans must ``provide such methods and procedures relating to the 
utilization of, and the payment for, care and services available under 
the plan * * * as may be necessary to safeguard against unnecessary 
utilization of such care and services and to assure that payments are 
consistent with efficiency, economy, and quality of care and are 
sufficient to enlist enough providers so that care and services are 
available under the plan at least to the same extent that such care and 
services are available to the general population in the geographic 
area.''
    Consistent with the requirement in section 1902(a)(30)(A) of the 
Act to provide payment for care in an effective and efficient manner 
consistent with quality of care, States are empowered to seek the best 
value through their rate-setting policies and may tailor their access 
strategies to take into account local conditions including geographic 
disparities in the availability of providers and demand for particular 
services. Achieving best value has been a key strategy for some States 
that have attempted to reduce costs in the Medicaid program in these 
difficult fiscal times. We do not intend to impair States' ability to 
pursue that goal, or their ability to explore innovative approaches to 
providing services and lowering costs for other reasons. Indeed, the 
Secretary and CMS, including through the new Center for Medicare and 
Medicaid Innovation, is actively engaged in helping States achieve 
better value and better care while lowering per-person costs.

B. Discussion

    Medicaid payment rate changes are a function of the State budget 
process in many States. We recognize that payment reductions or other 
adjustments to payment rates are legitimate tools to manage Medicaid 
program costs and achieve overall budget objectives. However, payment 
rate changes made without consideration of the potential impact on 
access to care for Medicaid beneficiaries or without effective 
processes for assuring that the impact on access will be monitored, may 
lead to access problems. Payment rate changes are not in compliance 
with the Medicaid access requirements if they result in a denial of 
sufficient access to covered care and services.
    Budget-driven payment changes have led to confusion about the 
analysis required to demonstrate compliance with Medicaid access 
requirements at section 1902(a)(30)(A) of the Act. States attempting to 
reduce Medicaid costs through payment rate changes have increasingly 
been faced with litigation challenging payment rate reductions as 
inconsistent with the access provisions of section 1902(a)(30)(A) of 
the Act. Resulting court decisions have not offered consistent 
approaches to compliance with the access requirement. These decisions 
have left States without clear and consistent guidelines and have 
subjected them to considerable uncertainty as they move forward in 
designing service delivery systems and payment methodologies.
    For instance, the United States Court of Appeals for the Ninth 
Circuit Court, in Orthopedic Hospital v. Belshe, 102 F.3d 1481, 1496 
(1997), cert. denied, 522 U.S. 1044 (1998) required the State agency to 
set provider payment rates that ``bear a reasonable relationship'' to 
provider costs, based on ``responsible cost studies.'' This ruling was 
reaffirmed by the Ninth Circuit in Independent Living v. Maxwell-Jolly, 
572 F.3d 644 (2009). In contrast, the United States Court of Appeals 
for the Seventh Circuit, in The Methodist Hospitals, Inc. v. Sullivan, 
91 F.3d 1026, 1030 (1996) did not find any requirement for prior cost 
studies or other procedural requirements. While other Federal Courts of 
Appeals have also addressed the issue, there is no consensus among the 
circuits.
    Significantly, in 2009, the Congress created the Medicaid and CHIP 
Payment and Access Commission (MACPAC) (Pub. L. 111-3, section 506) 
specifically to study and make recommendations on beneficiary access to 
care in Medicaid and the Children's Health Insurance Program (CHIP). 
With members appointed by the non-partisan U.S. Comptroller General, 
MACPAC reviewed 30 years of research and consulted extensively with key 
stakeholders to develop a recommendation on how to measure access to 
care for Medicaid beneficiaries. This recommendation was in MACPAC's 
first report to the Congress, published on March 15, 2011.

[[Page 26344]]

The MACPAC report sets out the three-part framework for analyzing 
access to care which, as we discuss below in this section of the 
proposed rule, we propose to adopt as part of a State-level review 
strategy. The MACPAC-recommended framework considers: (1) Enrollee 
needs; (2) the availability of care and providers; and (3) utilization 
of services.
    In this proposed rule, we recognize that States must have some 
flexibility in designing the appropriate measures to demonstrate and 
monitor access to care, which reflects unique and evolving State 
service delivery models and service rate structures. At this point, a 
singular approach to meeting the statutory requirement under section 
1902(a)(30)(A) of the Act could prove to be ineffective given current 
limitations on data, local variations in service delivery, beneficiary 
needs, and provider practice roles. For these reasons, we are proposing 
Federal guidelines to frame alternative approaches for States to 
demonstrate consistency with the access requirement using a 
standardized, transparent process, rather than setting nationwide 
standards. We are soliciting comments on this basic approach.
    It is important to note that, if adopted, this proposed rule would 
not directly require States to adjust payment rates, nor to take any 
steps that would not be consistent with efficiency, economy, and 
quality of care. We believe that even if access issues are discovered 
as a result of the analysis that would be required under this rule, 
States may be able to resolve those issues through means other than 
increasing payment rates. Rather, these rules proposed to clarify that 
beneficiary access must be considered in setting and adjusting payment 
methodologies for Medicaid services. If a problem is identified, any 
number of steps might be appropriate, such as redesigning service 
delivery strategies, or improving provider enrollment and retention 
efforts. It has always been within the regulatory authority of CMS to 
make SPA approval decisions based on sufficiency of beneficiary service 
access and this proposed rule merely provides a more consistent and 
transparent way to gather and analyze the necessary information to 
support such reviews.

II. Proposed State Level Review Strategy for Compliance With Access 
Requirements

    We are not aware of any standardized, transparent methodology that 
is broadly accepted to definitively measure access to health care and 
services. Partly as a result, there has been no prior Federal 
rulemaking or guidance previously on this subject. As a consequence, in 
implementing their programs, States lack the guidance that they need to 
understand the types of information that they are expected to analyze 
and monitor in determining compliance with statutory access 
requirements. This issue has come to light recently, both in litigation 
and in our review of proposed Medicaid State plan amendments (SPAs) 
that would reduce provider payment rates. Two Governors and several 
State Medicaid directors have sought Federal guidance in this area, and 
the Congress, by establishing MACPAC, has also expressed its interest 
in promoting more information analysis and guidance with respect to 
these important matters. MACPAC's March report is significant in that 
it offers the first Congressionally-authorized expert recommendation on 
standards and methodologies for defining access to health care and 
health services.
    We have a responsibility under the Act to ensure sufficient 
beneficiary access to covered services and are aware of the 
uncertainties and problems that arise for States in the absence of 
Federal guidance on methods and standards for States to demonstrate 
compliance with this requirement. At the same time, we are mindful that 
the landscape of health care delivery systems and associated payment 
methodologies is undergoing significant change, the relevant data are 
not always available, and that MACPAC, the entity established by the 
Congress to consider these issues, may adapt its first set of 
recommendations.
    As such, the strategy we are now proposing is designed to allow for 
State and Federal review of beneficiary access to evolve over time and 
for States to implement effective and efficient approaches and 
solutions that are appropriate to their local and perhaps changing 
circumstances. The proposed strategy would be a consistent and ongoing 
State-level review to demonstrate sufficient beneficiary access to 
services covered under the Medicaid State plan that is not solely 
focused on provider payment rate changes and the State plan process, 
but assesses ongoing performance.
    We note that section 1902(a)(30)(A) of the Act, and the 
requirements of this proposed rule, discuss access to care for all 
Medicaid services paid through a State plan under fee-for-service and 
do not extend to services provided through managed care arrangements. 
Managed care entities are subject to separate access review procedures 
that are set forth in 42 CFR part 438 to ensure network sufficiency and 
procedures for beneficiaries to obtain needed services. We are 
currently undertaking a review of State managed care access standards 
and are considering future proposals to address access issues under 
managed care delivery systems. The access requirements under section 
1902(a)(30)(A) of the Act, apply equally to States that are not 
changing provider payment rates and those that are. The proposed State 
reviews, however, will provide an analytic framework to consider the 
impact of any proposed Medicaid State plan rate reductions on service 
access.
    More specifically, we propose to require States to determine 
appropriate data elements that focus on the MACPAC-recommended three-
part framework, which include information on: Enrollee needs, 
availability of care and providers, and utilization of services. This 
and other information that the State believes to be relevant, will be 
periodically analyzed by States to demonstrate and monitor sufficient 
access to care. The data and analysis will be made available to the 
public and furnished to CMS as requested in the context of a SPA that 
reduces provider rates or restructures provider payments in 
circumstances that could result in access issues, or as part of ongoing 
program reviews.
    The MACPAC-recommended framework does not focus on one particular 
data element, such as the relationship of provider payment rates to 
provider costs, but recognizes that access to covered services is 
affected by multiple factors. Though cost may be one consideration 
affecting access to care, there are other factors such as local market 
conditions, variable provider costs, administrative burden for 
providers, and demographic differences. Depending upon State 
circumstances, cost-based studies may not always be informative or 
necessary. In addition, because many State payment rates are not 
specifically calculated based on provider cost considerations, it can 
be burdensome and not particularly productive to rely solely on that 
one factor as a measure of access.
    The proposed State-level review strategy would recognize an ongoing 
responsibility to conduct periodic reviews of compliance with access 
requirements for all Medicaid services and also a particular 
responsibility to review and monitor sustained service access after 
implementing a change in provider payment rates. While we are proposing 
to allow States some discretion to determine appropriate measures to 
demonstrate and monitor access to care within the three-part framework, 
this proposal provides consistent steps for States to follow in

[[Page 26345]]

demonstrating and monitoring Medicaid access.
    To ensure continuing compliance review, we propose that States must 
conduct access reviews for a subset of services each calendar year and 
release the results through public records or a web site developed and 
maintained by the State, by January 1st of each year. We have chosen to 
base the requirement on the calendar year because State fiscal years 
vary. We note that States may issue the access reviews prior to, but no 
later than January 1 of each year, with the first review completed by 
no sooner than 12 months after the effective date of the final rule. 
States may determine the services that they will review each year, 
provided that each service is reviewed at least once every 5 years. The 
reviews must include the specific measures that the State used to 
analyze access to care by geographic location, discuss the measures in 
the context of the MACPAC three-part framework, discuss any issues with 
access that were discovered as a result of the review, and make a 
recommendation about the consistency with the requirements of section 
1902(a)(30)(A) of the Act.
    We propose that, prior to submission of a SPA to reduce rates or 
alter the structure of provider payment rates in circumstances that 
could result in access issues for a covered service, the State would 
need to submit information from an access review that had been 
conducted within the year prior to submission of the SPA as applicable. 
We are proposing this requirement so that CMS and the States will have 
the information necessary to assess consistency with section 
1902(a)(30)(A) of the Act before a rate reduction or restructuring 
proposal is processed. Since it may be difficult to predict the impact 
that a provider rate reduction or restructuring of provider payments 
will have on access, we are also proposing that States develop special 
procedures to monitor access to services after such a change has been 
implemented. These procedures would result in a periodic review of 
State-determined indices that demonstrate sustained access to care that 
would be made available to CMS and the public.
    To address potential issues that develop in service access, we are 
proposing that States implement an ongoing mechanism that allows 
beneficiary feedback. This feedback mechanism could be based on 
beneficiary hotlines or surveys, an ombudsman program, or other 
equivalent mechanisms. In addition, we are proposing that each State 
specify a process to address any access issues that are discovered 
through the ongoing access reviews and monitoring, through a corrective 
action plan that would be submitted to CMS and would include specific 
steps and a timeline for State action to address such issues. As 
proposed under this proposed rule, States would need to submit their 
action plan to CMS within 90 days of discovering an access issue. 
Below, in section II.C. of this proposed rule, we offer some examples 
of actions that States may take to address access issues.

A. Data Measures To Demonstrate Sufficiency of Access

    We propose to provide States with discretion in determining the 
appropriate data measures to demonstrate whether access is sufficient 
through access reviews and monitoring efforts in the context of the 
MACPAC-recommended framework. We are offering specific suggestions on 
trends and factors that States could use to measure enrollee needs, the 
availability of care and providers, and utilization, but we would allow 
States to develop alternative approaches and improve on these 
suggestions within each of these categories of required data. We are 
soliciting public comments on additional data measures that may be 
useful in measuring access in the context of the proposed framework and 
whether it is appropriate to require certain data measures as part of 
State access reviews.
    We note at the outset that the data States would review under this 
rule will explicitly address Medicaid beneficiary access. However, the 
required statutory test is a comparison between Medicaid beneficiary 
access and access to medical services by the general population in the 
geographic area. While it is neither desirable nor feasible to require 
that States develop new data sources on general access to medical 
services, the data measures for Medicaid beneficiary fee-for-service 
access may, in some cases, require that States compare information from 
commercial insurance standards or Medicaid managed care. We welcome 
public comment on any existing data sources that address general access 
to medical services that might be relevant. In general, we are 
confident that the Medicaid data will implicitly address general access 
standards in the geographic area. For example, data on beneficiary 
experience and satisfaction will take into account expectations based 
on community standards, and the percentage of community providers 
enrolled and accepting Medicaid patients will necessarily indicate the 
availability of such providers in the community.
    We believe the meeting of enrollee needs should be the primary 
driver to determine whether access to care is sufficient. Measurable 
data on the beneficiaries' experiences and needs, however, may be 
difficult for States to attain. States may need to rely upon 
qualitative information that is received through beneficiary surveys or 
other means, such as hotlines or beneficiary Ombudsman offices that 
some States may have in place, and may request that community-based 
organizations, primary care providers, hospitals, case management, and 
other providers assist in soliciting the information from 
beneficiaries. Once a State determines the most efficient means to 
reach beneficiaries, it has a number of options for data elements that 
could be significant in assessing whether their needs are met:
     Extent of knowledge that a service is covered by the 
Medicaid program;
     Success in scheduling a service appointment with a 
provider, including after hours as necessary;
     Satisfaction with the availability of service providers 
within a reasonable distance from home;
     Ability to obtain transportation to and from a scheduled 
appointment;
     Number and reasons for emergency room services received in 
the year;
     Number and reasons for missed appointments and means;
     Ability to either schedule an appointment or receive 
services in light of limited English language proficiency;
     Turnover in providers such as with homecare workers or 
personal care attendants; and
     Means and ability to seek help in scheduling service 
appointments.
    The connection between the number of enrolled providers and the 
availability of services is seemingly obvious, but there are many 
qualifications that affect the meaningfulness of such data. It may be 
important to know the number of enrolled providers in relation to the 
overall number of providers in the community. And, in order to 
contribute to beneficiary access, it is significant to know whether 
enrolled providers have ``open panels'' which means that they are 
accepting Medicaid patients.
    Data on the availability of care and providers is likely more 
easily obtainable by States, measurable and able to be monitored on a 
consistent basis. Many of the elements that we suggest below are likely 
available through current State information systems, while some of the 
information may require a survey of the providers within the State. 
With that in mind,

[[Page 26346]]

States could review the following data elements:
     The availability of care and services through Medicaid 
fee-for-service as compared to access standards established under 
Medicaid managed care;
     The availability of care and services through Medicaid 
fee-for-service as compared to commercial managed care or other 
commercial insurance access standards.
     The number of providers with open panels who are accepting 
new Medicaid patients;
     The extent to which timely follow-up visits occur after an 
emergency visit or inpatient stay;
     Provider Medicaid enrollment (with open panels) compared 
to licensed providers in the preceding rate year applicable to each 
covered service;
     Provider Medicaid enrollment compared to actual provider 
Medicaid participation (as measured by claims submitted) in the 
preceding rate year applicable to each covered service;
     Provider Medicaid enrollment (with open panels) compared 
to provider enrollment in one of the four largest commercial insurers 
in the State in the preceding rate year applicable to each covered 
service;
     Provider loss and retention in the preceding rate year 
applicable to each covered service;
     The average amount of time from provider application for 
enrollment to the approval of the provider agreement; and
     The average amount of time from provider claim submission 
to payment of the claim by the Medicaid agency.
    Beneficiary service utilization data is relevant because changes in 
beneficiary service utilization can indicate access problems. In 
particular, drops in service utilization that coincide with payment 
changes may indicate access problems. In addition, patterns of 
beneficiaries obtaining access to care through hospital emergency rooms 
may be an indication of the access problems for certain categories of 
services.
    Beneficiary utilization data is readily available through State 
information claims systems and relatively easy for States to review and 
monitor. For purposes of reviewing utilization, States could focus on 
Medicaid utilization of applicable covered Medicaid State plan services 
in the preceding rate year on a per capita basis and also take into 
account that some services apply to subsets of the population (such as 
pediatric services and obstetrics services). States could also look at 
avoidable emergency room visits and hospital admissions to determine if 
there are issues with preventive hospital use that may suggest a 
corresponding access issue.
    Consistent with the performance standard measures described under 
the Affordable Care Act, we are actively working, with input from State 
partners to develop a coordinated and streamlined data solution aimed 
at reducing redundancy, administrative burden, and to maximize business 
value. As we propose to have States review data to measure Medicaid 
access to care, we are mindful that our broader data improvement and 
streamlining efforts that aim to inform program performance and 
compliance may also be useful to States in informing access to care. As 
part of this proposed rule, we are asking States to consider how 
measures of access to care may align with current program oversight and 
review activities so that the access reviews build upon existing State 
data collection efforts that are used to improve overall program 
efficiency and quality. In addition, through our data efforts, we will 
work to identify and highlight data available within CMS and States 
that can inform the State access review under this proposed rule and 
monitor access on a national basis.
    We also will offer States technical assistance in identifying 
available data resources and facilitate cross-State collaboration as 
they undertake the access review procedures proposed under this 
proposed rule. To initiate our technical assistance, we have worked 
with our Federal partners to develop a matrix of potential Federal and 
State data resources which may be helpful to States in developing their 
access reviews. These resources are listed below in section IV. of this 
proposed rule.
    The resources presented in section IV. do not address each data 
element identified in this proposed rule and much of the data will need 
to be obtained from existing or developed State sources. We are 
soliciting public comments and suggestions on these and other existing 
sources of data that may help States inform their rate-setting policies 
and their efforts to ensure service access. We will also develop a 
standardized template for States to report and make publically 
available the data analysis identified under this proposed rule. The 
template will be designed to focus on the data elements that a State 
has reviewed to measure access to care within the MACPAC recommended 
framework, any issues that the State has identified as a result of the 
review, and the State agency's recommendation on the sufficiency of 
access to care based on the review. We are soliciting public comments 
on the content of the access template and specifically, the important 
areas that States should address in their reviews. We believe the 
reviews should address, minimally, the data elements reviewed under the 
MACPAC recommended framework, including the information gathered on 
beneficiary experience, and the Medicaid payment rate comparison. 
However, we are interested in exploring additional topics that should 
be standardized through the template.

B. Public Process To Involve Stakeholders

    In addition to the access rate review, we propose to require a 
public process that States would conduct prior to submitting State plan 
amendments that propose Medicaid provider payment rate reductions or 
changes in the provider payment structure. We are not prescribing a 
specific form for that public process, but we would require that the 
State describe the process that they have developed in their State 
plan. We are soliciting public comments on whether specific elements 
regarding that process should be required. We also encourage States to 
conduct the public process in any instance when the State data 
collection and monitoring process uncovers an access issue. The purpose 
of the public process would be to provide a meaningful opportunity for 
beneficiaries, providers, and other interested parties to provide input 
and feedback on the impact that the proposed rate reductions will have 
on efficiency, economy, and access to care, offer ideas to enhance 
service delivery models and other innovative solutions to address 
access issues, discuss strategies to encourage continued provider 
participation, and develop the procedures that States will use to 
monitor access to care after implementation of the proposed rate 
reductions.
    We are proposing to require this public process in part because we 
have found that States that worked with affected stakeholders prior to 
implementing rate reductions often maintained a commitment from 
providers to continue to serve Medicaid beneficiaries. States have 
frequently held these discussions with the affected provider community. 
We are proposing that States also discuss the impact of proposed rate 
reductions with beneficiaries and other interested parties. As stated 
earlier in section II.A. of this proposed rule, we believe that 
beneficiaries' experiences in receiving services are a primary driver 
in determining the sufficiency of service access and it is important 
that their

[[Page 26347]]

views concerning changes that could directly affect their care be 
solicited.
    Moreover, it is also important to have a public process that 
obtains feedback from all affected stakeholders because each may have 
unique approaches to mediating Medicaid service access issues, 
promoting provider participation in the program, and assuring the 
program operates in an efficient and economical way. As proposed, the 
public process requirements will solicit feedback from stakeholders in 
determining the monitoring and oversight procedures that a State will 
implement to ensure access is sustained after the implementation of a 
rate reduction.

C. Monitoring Access and Corrective Action To Address Access

    As States review their service access data and monitor access after 
implementing rate reductions, it is important to have a process in 
place to address access issues that are uncovered through the new 
process. While we, through official compliance procedures, may address 
issues by requiring the State to develop a corrective action plan 
detailing action steps and timelines to address access issues, we are 
also proposing to allow States to identify access issues and submit a 
corrective action plan within 90 days of discovering the problem. When 
a State develops a corrective action plan on its own, we would not 
treat it as a finding of non-compliance, but as evidence of a good 
faith effort by the State to remain in compliance. Action plans may 
also be developed to improve the State's information base going 
forward, regardless of whether a particular access problem is 
identified.
    While a corrective action plan may have longer term action steps, 
it should set a target for compliance with access requirements that is 
no longer than one year from the submittal of the plan to CMS. We are 
also encouraging States to work with stakeholders through the public 
process to develop monitoring indices to ensure sustained access to 
care and remediation plans that address known access issues. 
Stakeholders can provide valuable input and assistance in the 
identification and implementation of measurable efforts that could 
increase access as appropriate for their local health delivery 
infrastructure, service delivery system, and other factors.
    The precise nature of needed corrective action depends on 
individual State circumstances. For instance, a State could submit 
action steps and a timeline to reduce administrative burdens on 
providers or to implement and oversee a program through which 
beneficiaries receive assistance in finding a service appointment. We 
understand that some States have ``ombudsman'' programs to aid 
beneficiaries in finding service appointments as part of their managed 
care systems and we offer that these programs could serve as one step 
in alleviating fee-for-service access issues or could help pinpoint the 
access issues with great precision. Alternatively, or perhaps in 
addition, a State might seek to incentivize the development or 
expansion of clinics in underserved areas where access is of particular 
concern. States could also structure their service reimbursement rates 
to address particular geographic disparities in service access or to 
offer incentives for available evening and weekend appointments to 
working individuals who may not have flexible schedules to accommodate 
regular work hour appointments. A State could also review, modify or 
implement transportation, telemedicine or integrated models of care 
(such as health homes or primary care case management) policies that 
serve to make care available in efficient and effective ways.
    In proposing to address access to care issues through any of these 
approaches, it would be important for States to describe their process 
for monitoring program effectiveness in improving or maintaining 
service access through use of these action steps so that the State will 
ultimately comply with the requirements at section 1902(a)(30)(A)of the 
Act.

D. Clarification and Electronic Publication of State Public Notice

    In addition to establishing a framework for documenting access to 
covered Medicaid services, this proposed rule would update the public 
notice requirement in Sec.  447.205 by recognizing electronic 
publication as a means to notify the public of payment policy changes. 
We are proposing this change at the request of States to relieve State 
burden. The current regulatory language, which requires publication in 
a State register similar to the Federal Register, the newspaper of 
widest circulation in each city with a population of 50,000 or more, or 
the newspaper of widest circulation in the State, if there is no city 
with a population of 50,000 or more, was drafted prior to widespread 
accessibility of the web and development of State government web sites 
and we are updating the regulation to consider electronic methods of 
publication.
    We are also soliciting public comment on the use of the term 
``significant'' in Sec.  447.205(a). The current public notice 
regulation calls for notice of ``significant'' changes in methods and 
standards, which has resulted in some confusion among States in 
determining when it is appropriate to publish notice. Because the term 
``significant'' is not defined, and because the impact of payment 
changes is not always objectively clear, States are not always clear on 
when it is appropriate to notify the public of changes to rate-setting 
methods and standards.
    Longstanding CMS policy has been to require public notice for any 
change in payment methods and standards because there is no definable 
threshold for a ``significant'' change that can apply across services, 
service providers, beneficiaries and other stakeholders. A change that 
may be significant for one individual or group of stakeholders may not 
be significant to another. Therefore, the historic interpretation has 
been applied because it is important for providers, beneficiaries and 
stakeholders to be aware of all changes in State rate policies and 
evaluate how those changes impact the delivery of Medicaid services. In 
addition, given that the process for amending the approved State plan 
to change provider payment rates is somewhat complex, we do not believe 
that States go through that process for changes that are not 
significant.
    We are soliciting public comments to determine if it is appropriate 
to clarify the public notice requirement at this time. One option to 
clarify the requirement is to remove the reference to significance and 
clarify that any changes in rates, methods and standards require public 
notice as has been consistent with CMS policy. We could also establish 
a threshold for significance.

III. Specific Proposed Regulatory Changes

A. Existing Authorities

    Section 1902(a)(30)(A) of the Act requires that, in order to 
receive Federal Financial Participation (FFP), States must set Medicaid 
service payment rates that are consistent with efficiency, economy, and 
quality of care and are sufficient to enlist enough providers so that 
services are available to Medicaid eligible individuals to the extent 
that they are available to the general population in the geographic 
area. The regulations located at 42 CFR part 447 subpart B (Payment 
Methods: General Provisions) sets forth the implementation requirements 
that States must follow when establishing Medicaid payment rates.

[[Page 26348]]

    Regulations at Sec.  447.203 establish certain documentation 
requirements that the State Medicaid agency must maintain and make 
available to the Department of Health and Human Services upon request. 
Specifically, for any increase in payment rates, the State Medicaid 
agency is required to record an estimate of the percentile of the range 
of customary charges to which the revised payment structure applies, a 
description of the methods used to make the estimate and an estimate of 
the composite average percentage increase of the revised payment rates 
of the preceding rates. This information is recorded in State manuals 
or other official files and applies to individual practitioner 
services.
    As currently described, Sec.  447.203 requires that States document 
a comparison of increased payment rates to customary charges and 
preceding rates at the time that the increase occurs and only for 
practitioner service rates. The documentation requirement does not 
contemplate rate decreases or include a process or timeframe for States 
to update the methodology and make a rate comparison using contemporary 
data. Further, the documentation process does not account for all 
Medicaid provider payments and could be interpreted to exclude payment 
increases for hospital, clinic, long-term care facilities, hospice, 
home health care, durable medical equipment, and other Medicaid service 
rates that encompass costs beyond practitioner services. Clearly, the 
regulation was intended to document potential overpayments for a subset 
of Medicaid service rates and is insufficient, in its current scope, to 
ensure the collection of information on efficiency, economy, and 
adequacy of current payment rates across all services and to measure 
service access.
    Regulations at Sec.  447.204 implement, in part, section 
1902(a)(30)(A) of the Act by adopting into the CFR the statutory 
requirement for comparable general population service availability. The 
regulation replicates the statute, stating that payments must be 
sufficient to enlist enough providers to ensure that services under the 
plan are available to recipients at least to the extent that those 
services are available to the general public. However, the regulation 
does not provide additional guidance to States on standards to 
demonstrate sufficient access to Medicaid services. Without specific 
guidance, States have attempted to comply with this regulation through 
a variety of methods. As discussed in more detail in section III.A. of 
this proposed rule, these methods include: stated assurances, public 
processes, and/or data reviews, each of which may not fully demonstrate 
that rates are sufficient to provide for Medicaid service access 
equivalent to service access available to the general public consistent 
with the statute.
    Regulations at Sec.  447.205 require, with certain exceptions, that 
the State agency provide public notice of any significant proposed 
change in methods and standards for setting Medicaid payment rates. 
Prior to the effective date of a change in methodology, which must be 
submitted to CMS for review through a Medicaid SPA, States are required 
to notify the public of the proposed change through publication of a 
public notice that is published in: a State register similar to the 
Federal Register, or the newspaper of widest circulation in each city 
with a population of 50,000 or more. If there is no city with a 
population of 50,000 or more within the State, the publication must be 
made in the newspaper of widest circulation within the State. The 
regulation specifies that the content of the public notice describe the 
proposed change in methods and standards, explain the reason for the 
change, identify the local agencies where the changes are available for 
public review, provide an address where comments may be sent and 
reviewed by the public, and give the location, date and time for any 
public hearings on the change. The public notice requirement is meant 
to notify stakeholders of rate-setting policy changes that have already 
been determined and does not require that States examine and provide 
the public with any information on the resulting impact on service 
access that the proposed changes may have once such changes have taken 
effect.

B. State Plan Review Process Changes

    Since 2008, as more States sought to amend Medicaid State plan 
payment methodologies by instituting significant provider rate changes, 
we have requested that States provide information to help the agency 
determine that the changes to rates resulting from State plan 
amendments will continue to provide for access to care consistent with 
the Act and the implementing regulations. As part of the SPA review 
process, we requested this information either informally or through a 
formal request for additional information. Though we did not develop a 
standard set of questions for all SPA information requests, similar 
concerns over adherence to the provisions of Sec.  447.204 were raised 
in many of the rate reduction SPA reviews. Without clear standards or 
processes for determining sufficient rates that will maintain access 
and encourage provider participation, States were offered a variety of 
means to satisfy the statutory requirement.
    Based on our current review methods, all States that propose to 
implement rate reductions through a SPA submittal, or change payment 
rate structures during the rate year, respond with a statement assuring 
that access would not be affected by the changes in the amendment. When 
asked for additional detail on the methodology that States used to 
determine compliance with the access requirement, only a few States 
indicated that they relied upon actual data to make the determination. 
Of the States that relied upon data, most focused on historical levels 
of provider enrollment and their belief that providers would not 
disenroll based on a reduction in payments. A few States also looked at 
rates as compared to cost, Medicare rates, or payment rates in 
surrounding States to determine the impact of the reductions. Some 
States noted that historic reductions had no discernible impact on 
provider participation and so they did not anticipate access issues as 
a result of additional reductions.
    Nearly every State held a public meeting that invited some or all 
of the providers to discuss the proposed changes or at least held 
informal discussions with providers and policy-makers. Approximately 
half of the States also included consumer groups and other affected 
stakeholders as part of the rate proposal hearings or discussions. Many 
of these public hearings, however, seemed focused on awareness of the 
coming rate changes, rather than a discussion on the potential impact 
to service access.
    Finally, when asked how they intended to monitor the impact of the 
rate changes on access, a few States indicated that they would review 
data submitted to their Medicaid Management Information Systems to 
determine if services utilization or provider participation levels 
dropped after the changes were implemented. Some States have hotlines 
or other mechanisms to record consumer complaints, although it is not 
clear how widely known these mechanisms are among beneficiaries or how 
the complaints are considered or evaluated over time. The majority of 
States did not offer any plan to monitor the impact of the rate 
reduction on an on-going basis or to make rate adjustments or other 
changes based on the monitoring activities.
    Absent data on the sufficiency of State efforts, including State 
plan rates, to

[[Page 26349]]

achieve access consistent with efficiency, economy, and quality and 
without a defined process for involving stakeholders in rate setting 
determinations, we have generally relied upon State assurances and 
these disparate State approaches to make decisions on proposed rate 
reduction SPAs. It should be noted that in one instance, we informed a 
State that based upon the persistent, widespread negative reaction by 
providers in response to a proposed significant rate reduction of an 
already low rate (by comparison to commercial rates and other State 
Medicaid rates for the same service), that we could not approve a 
reduction amendment as submitted because of concerns that Medicaid 
eligible individuals would no longer have adequate access to care. In a 
similar situation, where a State also failed to provide any information 
or analysis on whether the rate proposal would negatively impact access 
after the implementation of proposed reductions, we have denied the 
relevant SPAs.
    We agree with MACPAC that it is more consistent with the statute to 
make such decisions in the context of a consistent framework for 
evaluating access, informative data and a transparent process that 
assures stakeholder involvement. Therefore, we are proposing clear 
guidelines on data collection efforts and public processes that all 
States must implement in order to demonstrate that rate-setting is 
informed by sustained access to services consistent with the 
requirements of section 1902(a)(30)(A) of the Act.
    We are also proposing to require that States should submit to CMS, 
in support of State plan amendments that reduce payment rates or 
restructure provider payments in circumstance when the resulting 
changes could create access issues, an analysis based on access data 
collected during the prior year. The data itself would be available to 
CMS for review upon request.

C. Standards for CMS Review of Compliance With Access Requirements and 
State Plan Amendments Affecting Access

    As discussed above, we are proposing a State-level ongoing access 
review process that will generate analysis and data concerning access 
issues, and will provide a framework for ongoing monitoring and 
corrective action. We would consider State compliance with these 
procedural requirements, including both the access review process and 
the need for identification of access issues and corrective action 
plans, to be essential to a demonstration of compliance when we review 
proposed State plan amendments that affect access to services, such as 
provider payment reductions or restructuring. When a State has not 
complied with the access review requirements, we would not approve such 
a State plan amendment.
    We have considered and declined to propose setting a single uniform 
Federal standard for reviewing substantive compliance with access 
requirements because we believe that determination of such compliance 
is very fact-specific and data-specific, taking into consideration 
local circumstances.
    In our review of compliance with access requirements, we intend to 
focus on working with States to improve beneficiary access mindful of 
legitimate efforts to ensure that State policies are consistent with 
efficiency and economy, as well as to the potential advantages of 
innovative methods of service delivery, provider payment, and case 
management. However, we will have a perspective in reviewing State-
level access reviews and underlying data that States themselves will 
not have. This is because we will have the advantage of having seen 
similar access reviews from other States and will recognize best 
practices and analytic methodologies based on that experience.
    Federal review will be based on the statutory standard that the 
State must have methods and procedures ``to assure that payments are 
consistent with efficiency, economy, and quality of care, and 
sufficient to enlist enough providers so that care and services under 
the plan are available under the plan at least to the extent that such 
care and services are available to the general population in the 
geographic area.'' We believe that application of this standard 
requires a review and analysis of data in light of local circumstances. 
Determinations of compliance will necessarily involve judgments as to 
how to weigh the data States develop on access measures, and at least 
without more experience and analysis we do not believe those judgments 
can be readily reduced to procedural or substantive formulas. We invite 
comment on possible national or State-specific access threshold tests, 
particularly given that the statutory requirement to measure access to 
care in relation to the availability of care and services to ``the 
general population in the geographic area'' suggests a State-specific 
CMS review.
    In Federal oversight of State-level reviews to determine ongoing 
compliance with the statutory access requirement, we do not intend to 
develop independent analyses of beneficiary access to services, but 
instead will review State analyses to ensure that the State-level 
review process operated to reasonably demonstrate substantive 
compliance with the access requirements. Our review will generally be 
limited to the issues of whether the State collected relevant data on 
each of the required elements, and reasonably analyzed that data to 
find substantive compliance with access requirements. While we intend 
to conduct a case-by-case review of these State-level reviews, we may 
also issue guidance on State-level review practices and may integrate 
such guidance into our Federal oversight review.
    Such guidance may direct the State with respect to the analysis of 
the required data, and we may consider a State analysis to be deficient 
if those practices are not applied. For example, such guidance might 
inform States about how to appropriately weigh different types of data 
to ensure that the resulting analysis reflects overall access. If we 
conclude that a State-level review and analysis is deficient and 
therefore does not reasonably demonstrate compliance with the statutory 
access requirements, we intend to initiate a compliance process (which 
could involve requiring a corrective action plan pursuant to these 
regulations) or, for a pending SPA, we would disapprove the SPA. In 
that latter instance, we note that the State would have an opportunity 
during the reconsideration process to correct deficiencies in the 
State-level review and access analysis.
    We note that Federal oversight of State reviews will likely be more 
stringent when the State proposes changes in provider payment of 
significant magnitude, or when we have other evidence, either through 
data or other sources, of an access problem.
    While we are not proposing any single Federal standard for 
reviewing access issues, we are inviting public comment on whether 
there should be particular indicators that we would regard as an 
irreducible minimum standard. We have not proposed such a minimum 
standard for several reasons. First, it is not clear whether any 
particular indicator is going to be determinative of access issues in 
every circumstance. The access reviews will examine a number of 
indicators, and we believe they are best examined in the aggregate. In 
most cases, we believe that the different indicators that a State 
examines will confirm each other, but in some cases there may actually 
be a reason for a variation in the results that is based on a State-
specific characteristic. In any case, we believe that the overall 
access review process should make serious

[[Page 26350]]

access problems obvious and easily addressed in a case-by-case review. 
We also invite comment from States and others on whether a single or 
small set of Federally determined indicators is preferable 
administratively to a broader set of State determined indictors.

IV. State Use of National Data Resources To Fulfill Proposed Data 
Requirements

    As discussed previously in this proposed rule, we have worked 
closely with our partners within the Federal Government, the MACPAC, 
and a number of experts in an attempt to identify potential sources of 
data that States may use to fulfill their responsibilities under the 
proposal. We recognize that much of the information necessary to 
evaluate access may require States to use existing State data or 
develop or implement new resources, such as a beneficiary survey. We 
also recognize that data from different sources have distinct 
definitions, timeframes for collection, and therefore, challenge and 
limitations exist to trending data reliably. We are soliciting public 
comments on existing sources of data that States may use to ensure that 
they are fulfilling their responsibility to assure access to care and, 
if States are already analyzing data to measure access to care, that 
they share their sources and methods of data collection with other 
States either through public comment to this proposed rule or through 
MACPAC.
    At the Federal level, the Health Resources and Services 
Administration (HRSA) publishes the Uniform Data System, which includes 
patient count, diagnosis and expense data at the grantee, State and 
national levels for HRSA's Federally Qualified Health Center grantees, 
which are funded under section 330 of the Public Health Service Act. 
This information is available at https://www.hrsa.gov/data-statistics/health-center-data/#what. The HRSA also publishes State data 
on shortages in primary care, dental and mental health providers on the 
Health Areas Shortage Designation web site (https://hpsafind.hrsa.gov/HPSASearch.aspx). This information may be of particular use to States 
in targeting specific State locations where access problems are a known 
issue in that geographic area, without regard to payer. The Agency for 
Healthcare Research and Quality (AHRQ) has developed a Medical 
Expenditures Panel Survey, available at https://www.meps.ahrq.gov/mepsweb/data_stats/onsite_datacenter.jsp, which offers surveys of 
families and individuals, medical providers, and employers to document 
cost and use of health care and health insurance coverage. The Centers 
for Disease Control and Prevention (CDC), produces the National 
Ambulatory Medical Care Survey, which describes data on utilization and 
the provision of ambulatory care services in hospital emergency and 
outpatient departments, (https://www.cdc.gov/nchs/ahcd.htm), and the 
National Health Interview Survey, which tracks health status and health 
care access: (https://www.cdc.gov/nchs/nhis.htm).
    We publish a number of Medicare and Medicaid data measures through 
a contractor, the Research Data Assistance Center (RESDAC), (https://www.resdac.org/). In addition, we have developed the Medicare Current 
Beneficiary Survey, which States may find of use in developing surveys 
that track beneficiary experience (https://www.cms.gov/). States may 
also find the U.S. Census Bureau's Current Population Survey of use for 
developing beneficiary questionnaires, https://www.census.gov/.
    For external resources, the State Health Access Data Assistance 
Center (SHADAC) Web site, https://www.shadac.org/