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This proposed rule would update regulations to strengthen the integrity of state enrollment processes, state directed payments and other payment and access requirements. 

Statement of Need:

Following an extensive review of rulemaking finalized in 2024, which includes the Medicaid and Children’s Health Insurance Program Managed Care Access, Finance and Quality Final Rule (89 FR 41002; CMS-2439-F) and the Ensuring Access to Medicaid Services Final Rule (89 FR 40542; CMS-2442-F), CMS is developing a proposed rule to address priority fiscal and program integrity issues in Medicaid and the Children’s Health Insurance Program (CHIP), including rescinding or revising provisions finalized in the 2024 final rules.

Additionally, CMS intends to propose a number of provisions to enhance oversight of states managed care plans, and provider enrollment, such as (1) revising various overpayment, disallowance, and other administrative action authorities, (2) adding new grounds for state Medicaid agencies (SMA) to use to terminate/deny the enrollment of bad actor providers, and (3) giving SMAs greater authority to conduct on-site visits of providers to verify compliance with state Medicaid requirements.

CMS would issue proposals affecting managed care and access that are intended to reduce administrative costs and regulatory and administrative burden for both state Medicaid and CHIP agencies and the federal government. CMS would also issue proposals that affect program integrity that are intended to decrease fraud and improper payments. These proposals, if finalized, would be expected to lessen burden on states and enable more efficient and cost-effective implementation of the revised provisions.

Summary of the Legal Basis:

To provide states with the direction they need on whether or how to implement the rulemaking finalized in 2024, and to give states notice as early as possible of CMS’s plans for implementing sections 71103 and 71104 certain provisions of the One Big Beautiful Bill Act (OBBBA) (Public Law 119-21).  

Alternatives:

In developing the proposals for this rule, alternatives will be considered, including maintaining existing requirements.  These alternatives will be described in the rule.

Anticipated Costs and Benefits:

As we move toward publication, estimates of costs and benefits will be included in the rule.

Risks:

Risks associated with the impact of this rule are under development and will be included in the published rule.