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Medicaid Managed Care: Supplemental Payments

Eyman Associates’ attorneys have a long and successful track record in assisting clients in developing, implementing, financing and defending various Medicaid funding programs, including waiver-based payment mechanisms (such as uncompensated care pools and delivery system reform incentive pools), disproportionate share hospital (DSH) and upper payment limit (UPL) programs, graduate medical education (GME) payments, and supplemental physician payments.

Much of our recent work has been focused on ensuring adequate funding in managed care delivery systems. Eyman Associates has been on the forefront of this work since CMS overhauled its Medicaid managed care regulations in 2016, providing new authorities for states to direct payments to providers when certain conditions are met. States have begun to implement a wide variety of programs under these new authorities, codified at 42 CFR §438.6(c), and CMS is rapidly developing standardized (but partially unwritten) policies to govern them. Through these CMS-approved programs, states can direct managed care organizations to adopt specific provider payment policies, arrangements and rates. The programs can include rate increases and minimum or maximum fee schedules, as well as delivery system reform programs and value-based payment programs. CMS has developed a separate process for states to propose these payments (through a federally-developed “pre-print”), which then must also be incorporated into the state’s managed care contracts and rates. We have unique insight into CMS’ policies in this area obtained through a series of Freedom of Information Act requests to CMS, through which we have assembled and analyzed a comprehensive database of managed care directed payment programs across the country.

As these directed payments have been implemented nationwide, CMS has signaled a desire to review this authority and potentially issue rulemaking. We are closely following all developments in this space to provide our clients with the most accurate and up to date information. Refer below to the latest updates and most relevant resources on Directed Payments.

The Proposed Medicaid Fiscal Accountability Regulation (MFAR) (proposed on November 18, 2019)

The Proposed Medicaid Managed Care Rule (proposed on November 14, 2018)

CMS 2017 Final Rule on Pass Through Payments

State Medicaid Directors Letter

Appendix A of SMDL

CMS 2017 Medicaid Managed Care Rate Development Guide

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