November 12, 2020

CMS Releases Medicaid and CHIP Managed Care Final Rule

On Monday Nov. 9, the Centers for Medicare & Medicaid Services (CMS) released the 2020 Medicaid and Children’s Health Insurance Program (CHIP) Managed Care Final Rule. The purpose of the rule is to ensure state Medicaid and CHIP agencies can work effectively to develop and implement managed care programs that better serve each state’s growing number of Medicaid and CHIP beneficiaries. Currently, there are 55 million beneficiaries who are enrolled in Medicaid managed care plans. This also includes the 79% of CHIP children in 32 states who enrolled in CHIP managed care plans.

The majority of provisions will be effective 30 days after issuance of the Final Rule. Two provisions will be effective with contract rating periods starting on or after July 1, 2021, and two provisions that states will be required to come into compliance with for certain reports and quality strategies submitted on or after July 1, 2021. The rule includes significant revision in the following areas of the managed care regulatory framework:

  • Setting Actuarially Sound Capitation Rates (Medicaid).
  • Pass-Through Payments (Medicaid).
  • State-Directed Payments (Medicaid).
  • Network Adequacy Standards (Medicaid and CHIP).
  • Risk Sharing Mechanisms (Medicaid).
  • Quality Rating System (Medicaid and CHIP).
  • Appeals and Grievances (Medicaid and CHIP).
  • Requirements for Beneficiary Information (Medicaid and CHIP).

Access the fact sheet on the CHIP Managed Care final rule online and view the full rule here.