State Plan Amendment Process Assessing the Challenges
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1 State Plan Amendment Process Assessing the Challenges Mark Reagan, Chief Counsel, Hooper Lundy & Bookman, Inc. Caroline Haarmann, Senior Director for Medicaid Reimbursement and Research Mike Cheek, Senior Vice President for Reimbursement and Legal Affairs Agenda Overview of the State Medicaid Plan and State Amendment Process Barriers to State Affiliate Advocacy Synopsis of AHCA/NCAL Strategy to Address Advocacy Challenges Current Status of Efforts Open Discussion 1
2 Legal Concerns with SPA and Industry Protections Mark Reagan, Chief Counsel, Hooper Lundy & Bookman, Inc. Medicaid Rate Litigation Very few options to hold states accountable Federal courts have narrowed jurisdiction in Medicaid rate cases Recent U.S. Supreme Court decision appears to only allow cases directly against states to unapproved SPAs 2
3 Medicaid Rate Litigation Once approved, judicial review limited to attacking CMS approvals Recent federal court decisions have been very deferential to CMS approvals CMS strategy is to approve SPAswhile receiving the ability to implement a corrective action plan Medicaid Rate Litigation The bottom line is that judicial review of Medicaid rate-setting is very limited and deferential to government That reality requires a greater opportunity to influence rate-setting before it is approved by CMS The current administrative process of SPA review and approval does not permit provider influence or allow for due process 3
4 State Plan and State Plan Amendment Overview What is a Medicaid State Plan? Contract between a state and the Federal Government describing how that state administers its Medicaid program Gives an assurance that a state abides by Federal rules and may claim Federal matching funds for its Medicaid program activities Sets out groups of individuals to be covered, services to be provided, methodologies for providers to be reimbursed and the administrative requirements that States must meet to participate 4
5 State Medicaid Plan Structure is Consistent but Contents and Implementation Vary Section 1 Single State Agency Organization Section 2 Coverage and Eligibility Section 3 General Provisions Section 4 General Program Administration Section 5 Personnel Administration Section 6 Financial Administration Section 7 General Provisions State Plan Changes Require a State Plan Amendment (SPA) Authority to make State Plan changes vary by state State Plan or part of State Plan may be in statute; and/or All of State Plan may be in administrative code Budget authority or directive for rate changes may originate from the Single State Medicaid Agency or the Legislature and may be impacted by how the State Plan is codified Regional Offices (RO) review and act upon SPA Central Office (CO) reviews some SPAs in addition to ROs, such as with Institutional Rate SPAs Institutional rate SPAs are reviewed by the National Institutional Reimbursement Team (NIRT) 5
6 High Level Organizational Overview of Submission Process State Submits SPA to CMS RO CMS National Institutional Reimbursement Team (NIRT) Reviews NIRT Review Includes RO and CO CMS Staff Final Decision to State CMS has 90 Days to Act Approve or Submit Questions to State Which Restarts the 90 Day Clock Current SPA Process Detail State Process Medicaid Agency Internal Development This may include examining: Existing Market Rate Examine Market Health 1 Assess Impact Draft Change 3 Changes or Feedback based on Public Input: No Such Requirement 5 90 Question & Answer Period CMS Review: 1. State submits to Regional Office (RO) 2. RO Conditional Approval 3. RO submits to Central Office (CO) 4. CO Approves/Disapproves final 7 State Process 8 Reimbursement Change Directive (process varies by state): Medicaid Agency develops Legislature develops Either could develop 2 4 Begin Public Comment Period: Prior notice before submission to CMS of complete SPA contents Public notice using traditional methods Required Public Meetings State Submits to CMS: SPA and Method Explanation of Method 6 State notifies public of CMS final action No Such Requirement State Finalizes Changes: Rules promulgated Public comment MSIS programming State provider transmittal, training, updates to provider manuals 6
7 Key Issues with Current SPA Process Absence of a Notificationof SPA submission, required 90 day clock cycle update, CMS action (including approval) No opportunity for meaningfulstakeholderinput No requirement in most states for the state to respond to stakeholder input Proposed Improved SPA Process & Open Discussion 7
8 Legend (this does not apply to items included in the state process boxes): Current Federal Requirements Potential Improvements State Process Medicaid Agency Internal Development This may include examining: Existing Market Rate Examine Market Health Assess Impact Draft Change 1 Changes based on Public Input: 45 days to review and responds in writing to written MCAC member comments MCAC comments posted at state website Revised SPA posted if revisions made Notification of posting Question & Answer Period Must address set list of topics. Additional questions if Tier 2 CMS Review: 1. State submits to Regional Office (RO) 2. RO Conditional Approval 3. RO submits to Central Office (CO) with transmittal explaining approval/disapproval grounds with Tier rating. Additional detail if Tier 2 and must send public comments to CO 4. CO interviews state with RO (Tier 2 only) 5. CO Approves/Disapproves final 7 State Process 8 Reimbursement Change Directive (process varies by state): Medicaid Agency develops Legislature develops Either could develop Tier 1 Change Standard Level of Review Tier 2 Change Heightened Level of Review including CO engagement and in depth impact assessment 2 Begin Public Comment Period: 60 day prior notice before submission to CMS of complete SPA contents Public notice using traditional methods Notices: lists, State Website, MCAC Must indicate if expedited review requested Must indicate expected impact Required Public Meetings (Tier 2) 4 State Submits to CMS: State notified MCAC of transmission SPA Packet must include: SPA and Method Specific changes Explanation of Method Expected impact, including response to stakeholder input All comments from impacted groups Packet posted at Website 6 State notifies public of CMS final action State Finalizes Changes: Rules promulgated Public comment MSIS programming State provider transmittal, training, updates to provider manuals Discussion Framework In your experience, does the state follow the federal notification process described today and any additional steps that may be state-specific? Have you had difficulty with the state not sharing information with the industry on its rate change methodology? Do you have difficulty with the state sharing information about SPAs in general? With the current absence of viable legal recourse, do you believe that a process for meaningful input and a required response by the state would be helpful? 8
9 Resources MACPRO CMS database of all Medicaid State Plans is in development Web-based database for all SPAs approved on or after June 1, 2009 is now available Go to Amendments/Medicaid-State-Plan-Amendments.html Q&A Thank you for joining us! 9
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