States continue to grapple with Cures Act

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Friday, October 11, 2019

WASHINGTON – HME providers in California and Indiana have recently received reprieves from steep Medicaid cuts, but the discussion is going to be ongoing in those states and others as Medicaid programs still try to comply with the 21st Century Cures Act.

Per the Cures Act, passed in late 2016, the federal portion of Medicaid reimbursement for HME cannot exceed what Medicare allows. States can either base their Medicaid rates on Medicare’s lowest fee schedule; or they can gather aggregated data using their Medicaid rates and utilization rates for 2018 to determine new rates that comply with the rule.

“We’re trying to get states to do reconciliation and compare it to their rural areas so they can get those higher rates for the timeframe that those rates were in place,” said Laura Williard, vice president of payer relations for AAHomecare. “We worked with many states and got their utilization, and helped them look at and compare that to see if they are under the aggregate or not.”

In California, the Department of Health Care Services had proposed paying 80% of Medicare’s non-rural fee schedule amounts, which would have amounted to a cut of up to 60%. In response to concerns about access issues, CMS did not approve the rate reduction.

In Indiana, Medicaid officials had proposed cutting rates to match the lowest Medicare allowable on Oct. 1, but recently announced they would hold off.

It pays to go through the reconciliation process, says Williard. It allows states to look at which rates they need to adjust to come in under the aggregate spend. A good example: Missouri, where she helped eliminate nearly $5 million in overages by adjusting about 16 codes, she said.

“We’ll continue to do that and keep as many states as we can from going to non-rural rates,” she said. “As more reconciliations occur, I expect to get more notifications and have more meetings with Medicaid programs.”