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November 9, 2020

CMS Issues Medicaid Managed Care Final Rule

On November 9, 2020, CMS issued a managed care rule that largely finalizes policies proposed by the agency in a November 2018 proposed rule. Among other things, the final rule would eliminate prior approval requirements for directed payments implementing minimum fee schedules based on state plan rates, codify prior guidance allowing for multi-year approval of certain delivery system reform and value-based directed payments, allow new time-limited pass-through payments for populations transitioning from fee-for-service to managed care for the first time, and permit states to certify rate ranges as actuarially sound in certain circumstances. CMS did not finalize a proposal to explicitly authorize directed payments based on commercial and other market-based rates, indicating it will consider comments received on the issue to inform future rulemaking.