Sellers Dorsey Digest

Federal Updates

News

HHS Announces 10 New States to Participate in the CCBHC Medicaid Demonstration Program

• On June 4, the U.S. Department of Health and Human Services (HHS) announced that 10 new states will be participating in the Certified Community Behavioral Health Clinic (CCBHC) Medicaid Demonstration program: Alabama, Illinois, Indiana, Iowa, Kansas, Maine, New Hampshire, New Mexico, Rhode Island, and Vermont. The program, administered by CMS in partnership with SAMHSA, provides states with funding to expand access to mental health and substance use services in alignment with President Biden’s Unity Agenda and other efforts to support the mental health and addiction crisis. CCBHCs are reimbursed at full cost for Medicaid covered services and offer a comprehensive range of services for mental health and substance use disorder including 24/7 crisis care, care coordination, and timely outpatient care. The new cohort joins eight states already in the demonstration program: Michigan, Missouri, Kentucky, Nevada, New Jersey, New York, Oklahoma, and Oregon. Future expansions include awarding CCBHC planning grants to fifteen states in early FY2025, which will assist in certifying clinics, establishing prospective payment systems for Medicaid reimbursable services, and preparing an application to participate in the four-year demonstration. The expansion notice is expected to be posted this summer. Ten new states will be able to join the program in FY2026, in alignment with the Bipartisan Safer Communities Act (BSCA), which grants HHS the authority to add 10 states every two years (CMS, June 4).

Biden Administration Introduces Heat and Health Tool to Help Communities Prepare for Extreme Heat and Heat-Related Illness

• The Biden Administration developed and launched a new tool, the Heat and Health Index (HHI), that includes support and resources to help communities keep their residents safe from the expanding effects of climate change, including extreme heat and heat-related illness. This is the first tool able to provide heat-health outcome data at the zip code level and combines historic temperature data with Emergency Medical Services (EMS) data on heat-related emergency responses from the prior three years. The tool uses existing heat resources to provide a complete look at the communities most at-risk for negative health outcomes from heat by using available data on community characteristics, including pre-existing health conditions, socio-demographic information, and characteristics of both the natural and built environments (HHS, May 31).

CMS Releases Medicare, Medicaid Enrollment Figures

• On May 31, CMS released the latest enrollment figures for Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). As of February 2024, enrollment in Medicare increased by 69,037 from the last report to 67.1M. Medicaid enrollment decreased during the same period by 654,280, to 83.4M enrollees. Of that number, 7.1M are enrolled in CHIP. There are over 12M dually eligible individuals who are counted in both Medicare and Medicaid program totals. According to CMS, every state is currently resuming its regular process for renewals in Medicaid and CHIP (CMS, May 31).

CMS Issues its Second Request for Applications for the Enhanced Oncology Model

• CMS’ Innovation Center is requesting applications for a second cohort of participants in its Enhanced Oncology Model (EOM) and is extending the model for two years (through June 30, 2030), making higher payments and establishing a higher threshold for when a provider owes CMS a performance-based recoupment. CMS created the EOM in 2022 after incorporating findings from the Oncology Care Model that operated from 2016-2022. CMS stresses that the EOM aims to create transformation in oncology care by preserving or enhancing the quality of care for patients undergoing cancer treatment while lowering spending for Medicare fee-for-service. The application portal for the new cohort will open from July 1 through September 16, and state Medicaid agencies and Medicaid managed care organizations are among the list of payers eligible to apply for the model (Inside Health Policy, May 31).

Federal Litigation

SCAN Health Plan Wins Medicare Advantage Ratings Lawsuit

• On June 3, U.S. District Court for the District of Columbia Judge, Carl Nichols, ruled that CMS breached the Administrative Procedure Act while calculating SCAN’s Medicare Advantage star ratings last year. The lawsuit focused on a statistical update through the Tukey Outer Fence Outlier Deletion Method that was first announced in 2020 and whether the text of a preamble to a rule is legally binding. If officials determine that CMS must recalculate all scores for plan year 2024, the decision could have significant implications for other insurers and would likely impact a number of other health plan pending cases. It is also possible that the case will be appealed (Modern Healthcare, June 4).

Federal Regulation and Guidance

CMS Informs States on Renewal Process Practices

• On May 30, CMS issued State Health Official Letter (SHO) #24-002 to extend existing reporting of specific metrics included in the Unwinding Data Report, allowing CMS to continue identifying and addressing areas of noncompliance. Beginning in July, states will not be required to report on changes to the baseline data or pending Medicaid applications if they have successfully completed the unwinding process. However, every state will be required to continue submitting data relating to renewals and fair hearing outcomes in a new report, the Eligibility Processing Data Report. CMS believes this type of data is valuable in the monitoring of retention and disenrollment numbers while also mitigating burdens beneficiaries face. CMS stated that they plan to continue reporting renewals and related data publicly with no listed end date (Inside Health Policy, May 30).

Federal Studies and Reports

The Government Accountability Office Releases Report with Prior Authorization Recommendations for CMS

• According to a Government Accountability Office (GAO) report made public in May 2024, Medicaid managed care plans’ prior authorization decisions for children need additional oversight. In its recommendations, GAO has requested CMS provide clear guidelines for states to monitor Medicaid managed care plans’ prior authorization decisions, specifically for EPSDT services, claiming that inconsistent policies create confusion for providers and beneficiaries. GAO also wants CMS to clarify whether health plans can require prior authorization for services for which the state does not require it in the fee-for-service delivery system. While CMS is working with states to gather data on current oversight activities, a lobby representing over 150 managed care organizations is pushing back on the report and arguing that prior authorization is needed to protect patients from overutilization (Inside Health Policy, June 3).

State Updates

News

Ohio Releases RFA for Next Generation MyCare

• On May 31, the Ohio Department of Medicaid (ODM) released a Request for Applications for its Next Generation MyCare program. The current program serves dually eligible beneficiaries in 29 counties and the procurement would expand services statewide. Additionally, ODM is moving away from the Financial Alignment Initiative (FAI) demonstration to fully integrated dual-eligible special needs plans (FIDE-SNP). The Next Generation MyCare program is expected to launch in January 2026 and will require providers to offer comprehensive care coordination as well as expanded self-direction options and additional protections for transportation services. Providers are required to notify ODM of their intention to apply by June 21 at 4pm EST at IntentiontoBid@medicaid.ohio.gov. Applications are due August 2 (Dayton Daily News, June 3; Ohio Department of Medicaid, May 31; Ohio Department of Medicaid, May 31).

U.S. Court Judge Dismisses Florida’s Lawsuit Against HHS

• On May 31, a U.S. District Court Judge dismissed Florida’s lawsuit challenging HHS’ regulations prohibiting the state from dropping beneficiaries from CHIP on the grounds that their parents are not paying premiums on time. The judge cited the state’s need to go through the administrative process with CMS to challenge regulations, prior to filing a lawsuit (Health Payer Specialist, June 3).

Vermont Passes Bill Creating Framework for Regulating the Cost of Prescription Drugs

• On May 30, Vermont Governor, Phil Scott, signed a bill (S. 98) that directs the state’s Green Mountain Care Board, a five-member independent board established in 2011, to create a structure for regulating the cost of prescription drugs. The bill is a variation on prescription drug affordability board (PDAB) legislation that many states have enacted. The number of states establishing PDABs has been growing in 2024, but the PDABs’ ultimate success in lowering drug prices is determined on what is written into state bills. Vermont’s bill designates the Green Mountain Care Board to create a preliminary framework for the prescription drug cost regulation before January 15, 2025, and a final plan by January 15, 2026. The plans will include legislative proposals to implement the program (Inside Health Policy, May 31).

SPA and Waiver Approvals

SPAs

• Payment
  • California (CA-21-0005, effective January 1, 2022): Extends time-limited supplemental payments for Freestanding Pediatric Subacute (FS/PSA) facilities, to July 31, 2022.
  • California (CA-23-0028, effective July 1, 2023): Updates the payment methodology for Freestanding Pediatric Subacute (FS/PSA) facilities and changes the rate year to a calendar year basis, effective January 1, 2024, and makes adjustments to reflect the unwinding from the COVID-19 PHE rate increase.
  • Georgia (GA-23-0009, effective January 1, 2024): Revises the prospective payment rate setting methods for inpatient hospital services from the Tricare DRG v.35 to APR DRG v.40 and updates prospective base rate calculations for hospital Medicaid Inpatient Utilization Rates (MIUR), Indirect Medical Education (IME), Peer Group Add-On Amounts, and stop-loss/stop-gain adjustments.
  • Louisiana (LA-24-0003, effective January 1, 2024 through March 31, 2025): Provides for nursing recruitment and retention payments for nurses employed by a home health agency providing home health services to individuals under 21.
  • Louisiana (LA-24-0008, effective February 20, 2024): Updates the payment provisions regarding leave of absence days for intermediate care facilities for individuals with intellectual disabilities (ICF/IID) to increase the allowable total days from 45 days to 60 days and from 30 consecutive days to 45 consecutive days for any single occurrence.
  • Massachusetts (MA-24-0010, effective January 1, 2024): Updates the methods and standards used for Medicare crossover payments for ground ambulance services.
  • New Hampshire (NH-23-0034, effective July 1, 2023): Updates the payment rates for outpatient Supplemental Access Payments for certain Critical Access Hospitals.
  • New Hampshire (NH-24-0020, effective January 1, 2024): Updates the payment methodologies and rates for Substance Use Disorder and Medication Assisted Treatment Services.
  • New Hampshire (NH-24-0025, effective January 15, 2024): Adds payment rates for in-home providers under the Department of Children, Youth and Families (DCYF) Individual Service Option.
  • North Carolina (NC-24-0008, effective January 1, 2024): Updates the methodology and payment rates for Enhanced Mental Health Services, including the Interactive Complexity Add-on, Brief Interventions for Tobacco Cessation, and Psychotherapy.
  • North Carolina (NC-24-0009, effective January 1, 2024): Updates the payment rates for Partial Hospitalization and Child and Adolescent Day Treatment services.
  • Oklahoma (OK-24-0005, effective January 1, 2024): Adds opioid antagonists to the list of services that may be billed separately from the inpatient hospital prospective payment rate.
  • Pennsylvania (PA-24-0009, effective March 1, 2024): Updates the additional supplemental payments to nonpublic nursing facilities within in a county of the first class for fiscal year 2023-2024.
  • Pennsylvania (PA-24-0010, effective March 1, 2024): Authorizes additional payments to certain eligible county nursing facilities for fiscal year 2023-2024.
  • Pennsylvania (PA-24-0011, effective March 1, 2024): Updates the additional payments to nonpublic and county nursing facilities that are qualified to provide supplemental ventilator and tracheostomy care for fiscal year 2023-2024.
  • Pennsylvania (PA-24-0012, effective March 1, 2024): Authorizes additional supplemental payments to nonpublic nursing facilities within a county of the eighth class for fiscal year 2023-2024.
  • Utah (UT-24-0007, effective February 21, 2024 through June 30, 2024): Temporarily suspends copayments for prescription drugs due to the 2024 Change Healthcare Network Interruption.
  • Washington (WA-24-0005, effective June 8, 2024): Adds one Tribal pharmacy encounter eligible visit per Indian Health Service (IHS) eligible beneficiary per day (bringing the allowable encounters to six per eligible beneficiary per day).
• Service
  • Minnesota (MN-24-0014, effective January 1, 2024): Revises coverage and provider qualification requirements for certain Substance Use Disorder treatment services.

Private Sector Updates

News

Addus HomeCare Plans to Sell New York Operations to Competitor

• Addus HomeCare, a provider of in-home support services across 22 states, plans to sell its New York personal care operations to HCS-Girling for up to $23 million. The provider notes that the decision to sell is due to challenges of expanding home health and hospice services within New York and the uncertainty surrounding the recent final Medicaid access rules. The finalized date of this deal is unknown at this time (Modern Healthcare, May 21).

Biden Administration Rules on UnitedHealth Group Cyberbreach Notification Requirements

• On June 3, the Biden Administration announced that UnitedHealth Group is solely responsible for sending the required cyberbreach notices to consumers affected by the breach. Payers and providers have sought this clarification for months with the potential notification cost of over $100 million at stake. Notification requirements are required by the Health Insurance Portability and Accountability Act (HIPAA) and are enforced by the U.S. Department of Health and Human Services’ Office of Civil Rights (Health Payer Specialist, June 3).

Sellers Dorsey Updates

Webinar Recording: Unpacking the New CMS Medicaid Managed Care Rules

• Didn’t have a chance to attend our webinar? View the recording to gain valuable insights from our experts! They cover everything you need to know regarding the new rules including implications for states, managed care organizations, and much more.

Click here to view our webinar recording.