The Centers for Medicare and Medicaid Services (CMS) released proposed updates to Medicaid managed care regulations with the goal of easing some of the regulatory burdens while increasing the requirement for transparency. These updates offer more flexibility in developing and placing more regulation on certifying actuarially sound capitation rates.
The most significant changes related to actuarial soundness under the proposed authority are the reintroduction of certifying rate ranges and the considerations that must be given to assumptions applicable to rates under different federal financial participation levels.
The reversal of the elimination of rate ranges from the 2016 final rule places more stringent requirements on documenting support for the developed rate ranges. CMS also commented that the reintroduction of rate ranges may be especially valuable to states that procure contracts through competitive bidding, which was a primary reason for installing them.
To read more about the proposed updates to actuarial soundness, read this article by Brad Armstrong, Marlene Howard, and Christopher Pettit.
Join Milliman’s Brad Armstrong, Christopher Pettit, and Marlene Howard as they discuss implications of the final rule on the development of actuarially sound capitation rates and required supporting documentation. With its publication of the final Medicaid managed care rule (final rule), the Centers for Medicare and Medicaid Services underscored the importance of actuarial soundness in the capitation rate development process.
This webinar will take place on Tuesday, November 1, at 12 p.m. EST/9 a.m. PST. Webinar topics include:
• Action items for states and their actuaries
• Areas where the new rule may present challenges in the certification of rates
To register, click here.
For more perspective on this topic, read the article “Overview of guidance related to actuarial soundness in final Medicaid managed care regulations.”
With its publication of the final Medicaid managed care rule (final rule), the Centers for Medicare and Medicaid Services underscored the importance of actuarial soundness in the capitation rate development process. In this paper, Milliman’s Brad Armstrong, Christopher Pettit, and Marlene Howard summarize the implications that the final rule has on the development of actuarially sound capitation rates and required supporting documentation. The authors also discuss action items for states and their actuaries along with some areas where the new rule may present challenges in the certification of the rates.
The Patient Protection and Affordable Care Act (ACA) modifies Section 1915(i) of the Social Security Act to help states expand home and community-based services (HCBS) through Medicaid. States exploring this option need to understand the financial implications related to the implementation of Section 1915(i).
Milliman’s Rob Damler and Marlene Howard discuss several features and considerations of the 1915(i) state plan option in their Contingencies article entitled “Medicaid and the ACA.” Here is an excerpt:
One of the most significant modifications to Section 1915(i) was the addition of Section 1915(i)(7), which allowed states to define target populations for the delivery of the HCBS benefit package. This section waives the comparability requirement established in the DRA version of Section 1915(i). The CMS final rule proposed that the parameters for the target populations be defined by “diagnosis, disability, Medicaid eligibility groups, and/or age.”
The waiver of the comparability requirement allowed states to do the following:
• Define multiple target populations for 1915(i) and tailor multiple HCBS packages that could be individually allocated to each population; and
• Vary the amount, duration, and scope of a single 1915(i) service between various target populations.
…The ACA also expanded eligibility for the 1915(i) state plan option to individuals with incomes up to 300 percent of the Supplemental Security Income Federal Benefit Rate. If states choose to use this income eligibility definition for a 1915(i) service package, individuals must meet an institutional level of care as well as the needs-based criteria defined by the state. If states maintain the income eligibility threshold of 150 percent of FPL as established by the DRA, individuals do not have to meet an institutional level of care.