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CMS Bulletin on Medicaid Managed Care Oversight

The Centers for Medicare & Medicaid Services (CMS) released a Center for Medicaid and CHIP Services (CMCS) informational bulletin (CIB) on tools for states to monitor and oversee managed care in Medicaid and the Children’s Health Insurance Program (CHIP). Further, CMS will set new submission requirements before beginning to review Medicaid managed care contracts, including requirements related to state directed payments (SDPs).

Required Managed Care Reporting

States are required to submit an annual summary description of the medical loss ratio (MLR) report, which now may be submitted through the Medicaid Data Collection Tool for Managed Care Reporting (portal). MLR reports required as part of a rate certification submission for rating periods beginning on or after July 1, 2024, must be submitted through the portal.

The CIB also lists the Managed Care Annual Program Report (MCPAR) upcoming due dates and reviews the requirements for the Network Adequacy and Access Assurance Report (NAAAR).

Managed Care Contracts, Rate Certifications, and State Directed Payments Review

CMS must review and approve states’ Medicaid managed care contracts, rate certifications, and SDPs. According to the CIB, CMS continues to experience delays in state submissions of complete Medicaid managed care contracts, rate certifications, and SDP preprints. With this guidance, CMS will not begin formal review of contracts, rates, and SDPs until all elements are submitted.

For a managed care contract submission to be complete, it must include all contract actions signed and dated by all parties with all pages, appendices, and attachments, as well as any documents that are incorporated into the contract by reference, and any additional documentation, such as rate certifications, and MLR reports, if applicable. These requirements will be phased in with contracts effective on or after July 1, 2024, followed by increased requirements for contracts effective on or after July 1, 2025. The CIB appendices provide details for contract submission and the new review process.

For rate certification approval, a rate certification must be signed by an actuary with an attestation that certifies that the capitation rates are actuarially sound, as well as any supporting documentation.

SDP approval requires a complete SDP preprint and preprint addendum tables. For each SDP, risk-based managed care contacts must include a description of the providers entitled to the payment, how it is authorized, how the state is directing the plans to pay providers, and any reporting requirements the managed care plans must meet.

CMS has released several technical assistance toolkits to help states comply with this guidance, which focus on Medicaid managed care plan transitions, tribal protections, validation of encounter data, and program integrity.

This is a third CIB in a series. The first, released in 2021, provided a template for the managed care program annual report and the development of a web-based reporting portal. The second, released in 2022, updated the portal and included templates for the MLR report and the NAAAR.

Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Julie Kozminski is a policy manager at America's Essential Hospitals.

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