Intervention from the federal agency was needed because states often pay less than health plans need to cover costs, Karen Ignagni, CEO of America's Health Insurance Plans said during a Medicaid conference organized by the trade group Wednesday.
“States are under incredible budget pressure and we've found rates aren't sound,” Ignagni said.
CMS Medicaid Director Cindy Mann conceded that the federal agency hasn't been sufficiently engaged in policing the rates and that states have allowed budget pressure to influence what they pay.
“You cannot take a number that is budget-driven and throw it on the dartboard and say 'that will be my rate,'” Mann said
The statute requires states to submit rates certified by a qualified actuary to the CMS. When states submit their rates in 2015 they will have to provide additional information that clearly illustrates how they arrived at the rates. This will include claims data, encounter data, and plan financial data. States that expanded Medicaid under the Patient Protection and Affordable Care Act will also need to describe the data used to develop rates for the newly eligible groups.
The guidance comes days after HHS' inspector general's office released a report concluding that federal and state officials have not done enough to ensure that Medicaid beneficiaries have adequate provider networks and often must wait for months or travel far to see a doctor.
Low pay contributes to low Medicaid participation among providers, and health plans argue that one of the benefits of managed care is that plans can deploy the capitated payments to pay some doctors more to ensure access for beneficiaries.
“Our plans pay providers higher than what they would typically receive under fee for service, but continuing to do that could be challenging because of reimbursement,” said Jeff Myers, president and CEO of the trade group Medicaid Health Plans of America.
The industry says it's particularly important now that plans get sound rates as millions of people, mostly childless adults, are joining Medicaid as a result of expanded eligibility under the
Affordable Care Act. Already plans are seeing that these new enrollees have more healthcare needs than the traditional Medicaid population, especially for mental and behavioral health services.
“It's not just kids and moms anymore,” said Leslie Moran, senior vice president of the New York Health Plan Association. “We're talking about a significantly more challenging population we have to care for.”
Follow Virgil Dickson on Twitter: @MHvdickson
