Health Care Matters|May 17, 2024

May 17

New Medicare and Medicaid Integration Rule

In recent weeks, we are seeing increased activity from the Biden Administration, CMS, and Congress focused on improving care for dually eligible patients. The 2025 Medicare Advantage and Part D Final Rule, laid out new rules for dual eligible special needs plans (D-SNPs) with the goal of promoting better integration of Medicaid and Medicare for dually eligible individuals. In Congress, a bipartisan group of lawmakers led by Senator Bill Cassidy introduced a bill that would have the federal government establish a list of integrated plans that states could choose from and require integrated federal accounting between Medicare and Medicaid. Senator Robert Casey also introduced legislation that would give CMS and states $300 million to create their own integrated plans and increasing federal matching fund levels.

Why It Matters

Medicaid Waiver Extension

On May 9, the Center for Medicaid & CHIP Services (CMCS) within CMS released an informational bulletin (CIB) extending the unwinding of the PHE Medicaid flexibilities until June 30, 2025. States began redetermining eligibility for Medicaid in April of 2023 following the end of continuous eligibility requirements for Medicaid that began in 2020 as a result of the COVID-19 pandemic. KFF reported that as of last week, 21.9 million people have been disenrolled since April 2023. This far exceeded CMS’ initial prediction of 15 million individuals.

Why It Matters

Many of the disenrollments from Medicaid during redetermination were due to procedural issues. KFF reported that 69% of those disenrolled were terminated for reasons such as failing to return paperwork. CMS published an interim final rule in December of last year aimed at requiring states to better manage the process of unwinding, including rules around corrective action plans and fines. Hopefully, the additional time will give states the ability to invest more resources in ensuring that all beneficiaries eligible for Medicaid remain enrolled in the program.

Senators Whitehouse and Cassidy Release RFI and Legislation on PCP Payment Reform

On Wednesday, Senators Whitehouse and Cassidy announced a Request for Information (RFI) to accompany the Pay PCPs Act to improve payment for high-quality primary care providers. The Pay PCPs Act tasks CMS with creating hybrid primary care payments to better incentivize whole-person care and reduces Medicare beneficiary cost-sharing for certain primary care activities. It also creates a technical advisory committee to support CMS in determining Medicare fee schedule rates.

Why It Matters

The RFI and Pay PCPs Act is intended to help address the primary care shortage through acceleration of the hybrid Medicare payment models we have seen tested in CMMI initiatives. Value-based care models out of CMS whether ACO models like MSSP or medical home models like the new Making Care Primary (MCP) have continually relied on primary care physicians to coordinate care with other providers in return for some portion of savings for improving patient outcomes and cost. However, these payment streams can be unpredictable and in many cases rely on PCPs to take responsibility for the total cost of care of a population of which primary care spend is a small percentage. For many primary care providers the incentives in APMs do not overcome the risk and additional resource burden that accompanies participation. This legislation is an attempt to address relative under-payment for primary care services and provide more stability and predictability within the Medicare fee schedule for primary care. According to the RFI, the advisory committee would be distinct from the Relative Value Scale Update Committee (RUC) and would, "advise the Agency on new methods to more accurately determine those rates and correcting existing distortions which lead to under-reimbursement for high-value activities and services." Comments in response to the RFI are due July 15.