Major New Medicaid Proposal Promotes Home Care

Enhanced home- and community-based care is one goal of sweeping new regulations governing the Medicaid managed care system, proposed Tuesday by the Centers for Medicare & Medicaid Services (CMS).

The much-anticipated proposed rule sets forth more detailed requirements for Medicaid managed care plans that cover long-term services and supports, which can include in-home care. Under Medicaid managed care, states typically contract with private insurers to administer benefits.

These insurers, sometimes known as managed care organizations (MCOs,) often operate on some version of a pay-for-performance structure, which critics say can put too much focus on cost efficiencies to the detriment of beneficiaries and providers.


Managed care has grown substantially since the last major publication of managed care regulations in 2002, CMS notes in the newly released proposed rule. As of fiscal year 2011, nearly 60% of all Medicaid beneficiaries received benefits through a capitated managed care plan, and 20 states had implemented managed long-term services and supports (LTSS) programs as of 2014.

The newly proposed regulations for LTSS are based in large part on 10 elements of a strong program, which CMS previously formulated and included in 2013 guidance for states moving toward managed care for this population.

These 10 principles include: stakeholder engagement; enhanced provision of home- and community-based services (HCBS); and alignment of payment structures and goals.


Stakeholder engagement includes implementing provisions to ensure ongoing provider input into “what works and what does not” in the managed care system, according to the CMS document. 

As part of enhancing HCBS, managed care plans would have to be consistent with the Supreme Court’s Olmstead decision, under which state policies—including those dictating how Medicaid benefits are distributed—cannot effectively force people into institutional care if they are able to live in their own homes or community-based settings.

Payment systems should support goals including community integration, the proposed rule states.

The proposed rule runs to nearly 700 pages and addresses numerous facets of managed care in addition to LTSS. It is scheduled to be published in the June 1 edition of the Federal Register. CMS is accepting comments on its proposals through July 27.  

Written by Tim Mullaney

Companies featured in this article: