Unpacking CMS’s Final Rules on Medicaid Access and Managed Care

June 28, 2024 · Maya Spieske

The Centers for Medicare & Medicaid Services (CMS) recently announced two major updates to Medicaid regulations.  

This blog will delve into their significance and key policy implications for states and managed care organizations (MCO). 

What Happened  

CMS released the Ensuring Access to Medicaid Services Final Rule (“the Access Rule”) and the Medicaid and Children’s Health Insurance Program Managed Care Access, Finance, and Quality Final Rule (“the Managed Care Rule”) to enhance and standardize reporting, monitoring and evaluation of access to Medicaid services. These final rules were published in the Federal Register on May 10, with certain provisions scheduled to take effect on July 9. 

The Impact on Medicaid Beneficiaries  

CMS recognizes that outdated regulations and inconsistent delivery systems hinder access to quality care. The final rules address health inequities and further efforts to improve access to care, quality of care and health outcomes for Medicaid beneficiaries. 

Key Implications for States and MCOs 

States and MCOs can anticipate increased oversight from CMS to ensure compliance with new rule requirements.  

The Access Rule covers key dimensions of access across Medicaid fee-for-service (FFS) and managed care delivery systems, including home and community–based services (HCBS). In anticipation of the rule, NCQA built new provisions into its Long-Term Services & Supports (LTSS) programs to address quality gaps and maintain alignment with CMS. Those provisions include: 

• Ensuring Annual Review of Person-Centered Service Plans. States must review person-centered service plans every 12 months for 90% of individuals continuously enrolled in their HCBS program. NCQA LTSS Distinction standards require MCOs to identify individuals who might be susceptible to unplanned care transitions, which may entail reassessing the service plan. (Several HEDIS LTSS measures address reassessments and the creation of an appropriate service plan.) 
• Implementing Critical Incident Management. States must implement an electronic incident management system within 5 years of the rule’s effective date. NCQA LTSS Distinction standards require organizations to define critical incidents; identify responsibility; follow-up and act on critical incidents; and track critical incidents, investigations and interventions. 
• Establishing an HCBS Grievance Process. States must establish a complaint process for FFS HCBS beneficiaries within 2 years of the rule’s effective date. NCQA’s CM-LTSS program supports organizations operating in an FFS environment and requires them to establish a grievance process. 

The Access Rule also requires states to: 

• Adopt the HCBS Quality Measure Set. By December 31, 2026, states must adopt HHS-identified quality measures for their 1915c waiver programs. In the proposed Access Rule, HEDIS LTSS measures are included in the HCBS Quality Measure Set. NCQA continues to support the move to public reporting of HEDIS LTSS benchmarks. 
• Establish Medical Care Advisory Committees. States must establish a Beneficiary Advisory Council within 1 year of the rule’s effective date. The former Medical Care Advisory Committee is now the Medicaid Advisory Committee, and at least 25% of its members must be council.
• Report on 1915(c) HCBS Waiver Wait Lists. States must report on waiting lists and service delivery timeliness. 
• Ensure Payment Adequacy for HCBS Direct Care Workers. 80% of Medicaid payments for personal care, homemaker and home health aide services must go to direct care workers instead of to administrative costs. 
• Publish Payment Rates. States must publish all FFS Medicaid fee schedule payment rates publicly online to demonstrate transparency. 

NCQA’s LTSS programs and measures support Medicaid agencies administering both FFS and Managed LTSS HCBS programs and states can use them to streamline compliance activities. 

The Managed Care Rule affects Medicaid and Children’s Health Insurance Program enrollees, and requires states to: 

• Adopt Appointment Wait Times. States must develop and enforce wait time standards for routine appointments across three types of services: outpatient mental health and substance use disorder, primary care, obstetrics and gynecology.  
• Implement a Quality Rating System (QRS). States have 4 years to implement a QRS and post ratings on a public site. This is required for MCOs and prepaid health plans. States should consider NCQA Health Plan Ratings as an option for reporting HEDIS measures.
• Publicly Evaluate Their Quality Strategy. States must seek public comment on their quality strategy at least every 3 years, and post evaluation and results. Fifteen states use NCQA Accreditation in their Quality Strategies; find out how through the NCQA Medicaid Managed Care Toolkit.
• Consider Using In Lieu of Services (ILOS). The expanded definition and oversight of ILOS will result in more flexible utilization by states, codify protections for individuals using ILOs and increase the integrity of ILOS spending. NCQA’s Health Equity Accreditation Plus program offers states an opportunity to ensure that health care organizations establish frameworks for implementing services to address unmet health–related social needs as ILOS options are made available.
• Report State Directed Payments (SDP). States must use existing medical loss ratio reporting to collect annual SDP spending data and report annual provider-specific data to CMS. 

Navigating Next Steps 

The final rules are another step forward in promoting health equity across Medicaid care delivery systems. 

As states, MCOs and other stakeholders work to implement the new standards, NCQA is here to help them achieve regulatory compliance and improve health outcomes for Medicaid beneficiaries.

For guidance on the NCQA programs best suited to help your state meet CMS requirements, contact NCQA Public Policy.