As CMS rolls out details, eyes turn to Medicaid

‘The states have to ensure access to care, so they have the right to set rates to whatever they need to’
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Friday, December 1, 2017

WASHINGTON – CMS has finally started to detail how it plans to implement a provision in the 21st Century Cures Act that requires the agency to cap its contribution to Medicaid reimbursement for DME at Medicare reimbursement starting Jan. 1, 2018.

CMS on Nov. 28 published a notice in the Federal Register outlining its plans to require state Medicaid programs to submit their fee schedules for K, E and select A codes using a new spreadsheet to make sure they’re not paying too much for DME.

“They will have to submit annually to Medicare: codes, descriptions, modifiers, utilization, then rates,” said Laura Williard, vice president of payer relations at AAHomecare. “They have added a column based on our feedback for them to specify the allowable, rural, non-rural, etc.”

Stakeholders have been working most of this year trying to get additional information from CMS and state Medicaid programs about how they plan to implement the provision. The Cures Act was signed into law nearly a year ago, on Dec. 13.

While the spreadsheet gives stakeholders some new information, they’re still waiting for CMS to issue a letter to the state Medicaid programs with additional guidance, particularly on reimbursement.

“Which Medicare rates?” asked Seth Johnson, senior vice president of government affairs for Pride Mobility Products. “They’re saying bid rates, but if you look at any number of states, there are multiple bid rates. Which ones are they going to use?”

Williard has heard the letter might be issued before an upcoming State Operational and Technical Assistance conference call on Dec. 7, which she plans to participate in.

“The letter has been sitting at the Office of Management and Budget for approval for about two months now,” she said.

Stakeholders on a national and state level have been educating Medicaid programs that the provision doesn’t necessarily mean they have to set their reimbursement at Medicare reimbursement. They have succeeded in getting some programs to hold off from making any changes pending additional guidance, but things are down to the wire.

“The states have to ensure access to care, so they have the right to set rates to whatever they need to,” Williard said. “It just impacts the overall federal match.”

And therein lies the rub: State Medicaid programs can decide to set reimbursement at higher than the Medicare reimbursement, but they’ll have to make up for the reduced contribution from Medicare.

“That’s why we’re concerned they’ll just go and change their rates to Medicare rates just to comply and be done with it, instead of doing their due diligence,” Williard said. “I don’t think most will do that, but it’s a concern.”

Stakeholders believe states whose Medicaid programs are largely administrated by managed care organizations may be exempt from the provision, which would help.

“Until that’s actually verified, though, I’m not going to breathe a sigh of relief,” said Rose Schafhauser, who leads a number of state HME associations.