How the new Medicaid & CHIP managed care regulations are tackling quality


Earlier this week, the Centers for Medicare & Medicaid Services (CMS) released the Medicaid and CHIP Managed Care Final Rule, which seeks to modernize these programs in tandem with the rest of the healthcare delivery system.

This final rule is the first major update to Medicaid and CHIP managed care regulations in more than a decade. The 1,495-page regulation aligns key rules with those of other health insurance coverage programs, improves how states purchase managed care for beneficiaries, and increases the focus on consumer experience and key consumer protections. While most of the new requirements and rules are directed at states and payers that administer Medicaid and CHIP managed care plans, there are some parts of the rule that provider organizations should be aware of since they may impact current or future pay-for-performance programs administered by states and payers, including:

  • Extending requirements around external quality review and a managed care quality strategy to all types of managed care organizations, including state-contracted prepaid ambulatory health plans and primary care case management entities whose contracts include payment incentives for improved quality.
  • Requiring states to post additional information about managed care plans on their websites, including information on managed care plan accreditation status, state managed care quality strategies, and the results of the annual external quality reviews, which provide an independent assessment of the performance of managed care plans.
  • Establishing authority to develop and implement a Medicaid and CHIP quality rating system (QRS) that will enable states to better measure and manage the quality of care delivered to Medicaid and CHIP beneficiaries and will provide consumers with comparable quality information about plans in their state.

What providers need to know about the Medicaid and CHIP Quality Rating System

One of the biggest changes coming out of this final rule is that it authorizes CMS to develop a Medicaid and CHIP managed care quality rating system (QRS). This new quality rating system, similar to the systems in place for Medicare Advantage plans and insurance marketplace exchange plans, would serve consumers by providing them with comparable information about all managed care plans that they can use when making purchasing decisions. In addition, the rating system would allow states to better evaluate managed care plans available to consumers so that they can better manage overall quality of care.

So what does the Medicaid QRS mean for provider organizations? Well, if history is any indication of how payers react to quality mandates and regulations, it is likely that managed care plans will begin more closely monitoring the quality of care that their provider networks are delivering to Medicaid and CHIP beneficiaries in order to improve plan ratings under the QRS. This could translate into provider-facing pay-for-performance programs administered by Medicaid and CHIP managed care plans, or other types of quality-driven programs where providers are expected to monitor and report quality data to the plan. These programs would allow the plan to identify providers that may be bringing down the overall plan quality rating and to take action, if necessary.

What’s next for the Medicaid and CHIP QRS?

CMS has said that it will develop it’s QRS to align with the summary indicators used in the Marketplace QRS, while retaining flexibility for states to select and include different measures within each summary indicator that reflect the particular populations served by Medicaid and CHIP. While states have the option to implement CMS’s QRS in its entirety, they also have the option to develop an alternative quality rating system, as long as it yields information regarding plan performance that is substantially comparable to that yielded by the CMS-developed Medicaid and CHIP managed care QRS. CMS has indicated that they expect the QRS provisions will be implemented over the next five years.

In a blog post, CMS acting administrator Andy Slavitt wrote, “These improvements modernize the way these managed care health plans operate so that Medicaid and CHIP continue to provide cost-effective, high-quality care to consumers.”

While potentially different quality rating systems across states might still lend itself to implementation challenges and consumer confusion, this is still a move in a positive direction when it comes to purchasing transparency for healthcare consumers and holding managed care plans accountable. Medicare Advantage Star Ratings and Marketplace exchange ratings have been a major driver of quality improvement for health plans, and there is reason to believe that this change will yield similar positive results for Medicaid and CHIP beneficiaries as well.

Further reading:
How using the MIPS 90-day reporting period will increase your 2017 Composite Score
Avoiding a penalty in 2018 MIPS: the nuts and bolts

Email Alerts

Stay informed with Able Health email alerts

Be the first to know about key PQRS and MACRA information, deadlines, and expert analysis