Game Changer: CMS’ Proposed Medicaid Managed Care Regulation

The Centers for Medicare and Medicaid Services (CMS) released its long awaited Medicaid managed care proposed rules on May 26; the rules were published in the Federal Register on June 1 (80 Fed. Reg. 30198-31297). The last time the federal government seriously tackled Medicaid managed care was in a 2002 regulation (67 Fed. Reg. 40989, June 14), a response to the Balanced Budget Act of 1997 (Pub. L. 105-33), which itself amounted to a major new chapter in Medicaid’s relationship to what by then had become known as managed care.

In both vision and sweep, the new proposal represents a defining moment in the life of Medicaid. The proposal amounts to a basic advance in thinking about how to organize and deliver health care for tens of millions of people, as well as how Medicaid-sponsored coverage arrangements should integrate with private coverage, in particular, qualified health plans sold in the Exchange. Furthermore, the proposed rules create a framework for making managed care work for high-need populations receiving long term services and supports, whose integration into managed care arrangements is still in a relatively early stage.

Comments on the proposed rule are due by July 27, 2015. CMS is likely to be deluged, given the sweeping nature of many of the proposed reforms. While the proposal addresses both the Medicaid and CHIP managed care markets, this post considers the Medicaid regulation only.