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This rule implements additional parameters under managed care delivery systems related to access to care requirements, States' use of In Lieu of Services or Settings (ILOS), State directed payments, quality rating systems, and other policy and reporting changes to ensure the efficient operation of State managed care programs.

Statement of Need:

This rule advances CMS' efforts to improve access to care, quality and health outcomes, and better address health equity issues for Medicaid and CHIP managed care enrollees. The rule specifically addresses standards for timely access to care and States' monitoring and enforcement efforts, clarifies standards State directed payments and certain quality reporting requirements, adds new standards that would apply when States use ILOSs to promote effective utilization and identify the scope and nature of ILOS, specifies medical loss ratio (MLR) requirements, and establishes a quality rating system (QRS) for Medicaid and CHIP managed care plans.

Summary of the Legal Basis:

States may implement a Medicaid managed care delivery system using four Federal authorities: sections 1915(a), 1915(b), 1932(a), and 1115(a) of the Social Security Act (the Act), and a CHIP managed care delivery system using two Federal authorities sections 2101(a) and 2107(e)(2)(A) of the Act. 

Alternatives:

In developing the policies contained in this rule, we considered numerous alternatives, including maintaining existing requirements. These alternatives are described in the rule.

Anticipated Costs and Benefits:

We anticipate that most of the provisions in this rule will minimally or moderately increase administrative burden and associated costs.  Certain provisions including State directed payments, MLR reporting standards, and ILOS could potentially have a significant impact on the associated and corresponding managed care payments.  Information about anticipated costs will be included in the final rule.

Risks:

Risks of this rule are still under development and will be included in the published rule.