Frequently Asked Questions

State Medicaid Director Letter #17-004 addressed this area by stating: “Reductions necessary to implement CMS federal Medicaid payment requirements (e.g., federal upper payment limits and financial participation limits), but only in circumstances under which the state is not exercising discretion as to how the requirement is implemented in rates. For example, if the federal statute or regulation imposes an aggregate upper payment limit that requires the state to reduce provider payments, the state should consider the impact of the payment reduction on access.” In addition, the long-standing policy of the Medicaid program has been that Medicare rates are sufficient to ensure access.

FAQ ID:93521

We acknowledge that there are differences between the Medicare and Medicaid populations, but nothing in the policy guidance or statute compels states to reduce the items that states provide to people with disabilities under the state plan. As noted above, the statute does not expressly compel states to reduce the payment rates for DME. The statute limits the amount of money that the federal government will pay (i.e., FFP) for the relevant DME in the aggregate as compared with the relevant DME provided in the Medicare program. States retain the flexibility to make payments at rates that best serve the needs of their Medicaid beneficiaries.

FAQ ID:93526

As we explained in the January 4, 2018 letter, only those items provided in the Medicaid program on a fee-for-service (FFS) basis are to be included in the aggregate expenditure calculation. DME reimbursed under a Medicaid managed care arrangement or a Medicaid competitive bidding contract are not subject to the FFP limitation. If a state is 90% managed care the state would only have to show compliance or a demonstration with the 10% of FFS utilization and expenditures for the relevant DME items.

FAQ ID:93531

So long as the MCOs are not paid on a fee-for-service (FFS) basis, MCOs are not covered under this statute or subject to the limit on FFP. Only the relevant DME items provided in FFS are included in this limit.

FAQ ID:93536

Only those items provided in the Medicaid program on a fee-for-service basis are to be included in the aggregate expenditure calculation. DME reimbursed under a Medicaid managed care arrangement or a Medicaid competitive bidding contract are not subject to the federal financial participation limitation.

FAQ ID:93541

If the HCBS waiver includes FFS payments for DME, the state’s expenditures for DME would be subject to the limit.

FAQ ID:93546

CMS plans to provide technical assistance on transition plans to States through the State Operations and Technical Assistance Team (SOTA) calls and through other calls with the State. We will also be providing additional guidance about the information that should be included in the transition plans. We will consider the transition plans that need to be submitted by the due date as living documents that are open to revision, and will continue to work with States to ensure a seamless transition in 2014 for beneficiaries and States.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 55.99 KB)

FAQ ID:93021

The Affordable Care Act provides significant federal support to ensure the availability of coverage to low-income adults. Enrollment caps limit enrollment in coverage on a first come, first serve basis. Periods of ineligibility delay or deny coverage for otherwise eligible individuals. These policies do not further the objectives of the Medicaid program, which is the statutory requirement for allowing section 1115 demonstrations. As such, we do not anticipate that we would authorize enrollment caps or similar policies through section 1115 demonstrations for the new adult group or similar populations.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 105.59 KB)

FAQ ID:93751

Demonstrations focused on changes to how health care services are delivered, such as the use of managed care, will not generally affect the state's matching rate. Please refer to our February 2013 FAQs (PDF, 135.35 KB), which provide further clarification on the two increased federal match rates: the newly eligible rate and the expansion state rate as well as the final FMAP rule published on April 2, 2013. Additionally, CMS issued two State Medicaid Director letters, on July 10, 2012, that provide guidance on how states can adopt integrated care models without the need for a section 1115 demonstration.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 105.59 KB)

FAQ ID:93756

CMS continues to work closely with states to provide options and tools that make it easier for states to make changes in their Medicaid programs to improve care and lower costs. In the last six months, we have released guidance giving states flexibility in structuring payments to better incentivize higher-quality and lower-cost care, provided enhanced matching funds for health home care coordination services for those with chronic illnesses, designed new templates to make it easier to submit section 1115 demonstrations and to make it easier for a state to adopt selective contracting in the program, and developed a detailed tool to help support states interested in extending managed care arrangements to long term services and supports. We have also established six learning collaboratives with states to consider together improvements in data analytics, value-based purchasing and other topics of key concern to states and stakeholders, and the Center for Medicare and Medicaid Innovation has released several new initiatives to test new models of care relating to Medicaid populations. Information about these and many other initiatives are available on Medicaid.gov. We welcome continued input and ideas from states and others. States can implement delivery system and payment reforms in their programs whether or not they adopt the low-income adult expansion. With respect to the expansion group in particular, states have considerable flexibility regarding coverage for these individuals. For example, states can choose a benefit package benchmarked to a commercial package or design an equivalent package. States also have significant cost-sharing flexibility for individuals above 100% of the federal poverty level, and we intend to propose other cost-sharing changes that will modernize and update our rules.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 359.41 KB)

FAQ ID:94606