Revisit Medicaid Payment, Protect Network Adequacy, AAFP Tells CMS

Academy Advises Agency on Proposed Rule to Streamline Medicaid and CHIP Framework

January 25, 2019 03:58 pm News Staff

CMS says a rule it has proposed would streamline the Medicaid and Children's Health Insurance Plan (CHIP) managed care regulatory framework, help relieve regulatory burdens and support state flexibility.

[physician writing letter by pen]

But the AAFP, in a detailed letter commenting on the proposal as published in the Nov. 14 Federal Register,(www.govinfo.gov) reminded the agency of other criteria that the rule should meet.

The Jan. 14 letter to CMS Administrator Seema Verma, M.P.H., signed by Board Chair Michael Munger, M.D., of Overland Park, Kan., referred the agency to an applicable and longstanding AAFP policy: Medicaid coverage should include a uniform range of mandatory services and state-approved optional services, and payment for services under Medicaid, CHIP and Medicaid Managed Care Organizations (MCOs) should be fair and adequate -- and at least equal to Medicare rates.

Payment and Core Principles

Noting that the Academy has long pressed lawmakers to equalize Medicaid and Medicare payment rates, the letter asked CMS to ensure that all Medicaid programs "include provisions whereby the homeless and medically uninsurable are covered." To accomplish this, it added, "states should expand Medicaid to avoid coverage gaps."

Story Highlights
  • In response to a proposed rule on payment for Medicaid, CHIP and Medicaid Managed Care Organizations (MCOs), the AAFP told CMS in a letter that payment for these services must be set at least at Medicare rates.
  • The letter also warned that the proposed rule's changes to network-adequacy standards would usher in costly and inefficient direct-to-consumer telemedicine.
  • The AAFP referred CMS to longstanding Academy policy that should guide changes to the proposed rule.

Citing the AAFP's core principles on Medicaid and MCOs, the letter further called on the administration to see that Medicaid and CHIP MCOs are held accountable for

  • adequacy of primary care and specialist networks,
  • assignment of beneficiaries to nearby primary care physicians,
  • continuity of care from the primary care physician of each beneficiary's choice, and
  • ensuring access to all allowable and covered services under federal and state law.

Network Adequacy

The letter called on CMS to ensure that Medicaid, CHIP and MCOs pay at rates at least equal to those of Medicare.

In addition, the AAFP said, CMS must at least maintain its current approach of requiring states to establish time and distance standards for network adequacy. The letter pointed out that a review of state documents by the Medicaid and CHIP Payment and Access Commission (MACPAC) found that states could do so with the flexibility allowed under existing rules.

"Given MACPAC's finding that flexibility already exists for states, the AAFP strongly encourages CMS to continue to improve their monitoring of Medicaid and CHIP managed care plans' network adequacy and ensure that beneficiaries are not excluded from receiving needed benefits."

The proposed rule would allow states to replace the time-and-distance standard with a quantitative network-adequacy standard, which would permit states that rely heavily on telehealth to consider virtual care when assessing access to providers.

Such a revised standard, the Academy warned, would usher in direct-to-consumer telemedicine -- a costly, inefficient and disruptive result that runs counter to the AAFP's definitions of primary care.

"The AAFP opposes this approach unless the telehealth provider is a physician who is also providing in-person care in the payer's network," the letter said. "If a provider is only available to provide care virtually, then they are not truly 'available' to meet all potential care needs for a patient in the payer's network within the applicable medical specialty."

Such an approach would make it more difficult for patients to access the longitudinal, comprehensive primary care they need, the letter noted.

Directed Payment Changes

The proposed rule would eliminate requirements for CMS approval of fee schedules already outlined in approved state plans while allowing the use of alternative directed payment arrangements and multiyear approval of directed payment arrangements.

The AAFP pointed out the problem this would create: "Family physicians often report that Medicaid managed care payment rates are woefully inadequate and that they struggle to afford providing services to the Medicaid managed care population. Again, the AAFP strongly recommends CMS establish payment rates to be at least equal to Medicare for the Medicaid, CHIP and Medicaid MCO programs."

The letter pointed out that the AAFP's proposed Advanced Primary Care Alternative Payment Model,(8 page PDF) "would empower family physicians -- especially those in small, independent practices -- to move away from fee-for-service payment systems and into population-based, predictable revenue streams financed by Medicaid and other payers.

The letter went on to say that CMS should require all Medicaid and CHIP managed care plans to

  • make provider-level data publicly available,
  • clarify whether the upper payment limit applies to directed payments and explain how it will be enforced, and
  • improve reporting and monitoring of their quality strategies and evaluation plans.

Related AAFP News Coverage
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(10/8/2018)

AAFP's Alternative Payment Model Wins Testing Recommendation
'It's Better for Our Country,' Says Committee Member

(12/19/2017)