Health Policy News April 2016

Last summer, the Centers for Medicare and Medicaid Services (CMS) proposed a comprehensive overhaul of the regulations governing Medicaid and Children’s Health Insurance Program (CHIP) Managed Care. With the final version released earlier this week, the next two issues of Health Policy News will focus on Medicaid Managed Care.

This month, we recap the proposed rules as we work to digest the recently released final regulations. We also highlight the recently finalized Medicaid mental health parity rules, which apply equally to Medicaid Managed Care. This issue includes other recent regulatory updates: information about CMS’s new Comprehensive Primary Care Plus (CPC+) model and information about CMS’s guidance extending the direct enrollment option for state-based Small Business Health Options Programs (SHOPs).

We will release a special issue of Health Policy News in early May with a summary of the final regulations and information about a PCG web-ex event about the final regulations with health policy subject matter experts in the near future. Stay tuned for additional details!

We will follow this up with our next monthly edition, which will focus on recent innovations in Medicaid Managed Care, including the role of Medicaid Managed Care in recent Medicaid expansion waivers and the introduction of provider-led managed care plans.

As always, we invite you to contact us at for more information or if we can assist you in any way.

Final Medicaid Managed Care Rules

CMS released a proposed overhaul of the regulations governing Medicaid and CHIP Managed Care last May and accepted comments through July. In addition to their sweeping impact, these rules are particularly meaningful as they are the first major changes to the rules governing Medicaid Managed Care since 2002.

As states agencies and others review the final regulations, we are sharing a summary of the proposed regulations that we first released last summer. Click here to read more.

Back to top

CMS Announces CPC+ Primary Care Model

On April 11, 2016, CMS announced the new CPC+ model. The CPC+ model, which builds on the CPC model launched in October 2012, is designed to align Medicare, state Medicaid agencies, and commercial insurance payers to achieve comprehensive, coordinated primary care, especially for patients with complex medical and behavioral health needs.

Primary care clinicians can choose CPC+ “track 1” or “track 2,” a more innovative model under which practices will be expected to offer enhanced services such as identification of psycho-social needs and resources. Track 1 includes a $15 per patient per month (PMPM) care management fee (on average), a $2.50 PMPM performance incentive payment tied to quality and utilization metrics, and regular fee-for-service payments (including regular FFS evaluation and management (E/M) payments). Track 2 curtails E/M FFS payments but includes a $28 PMPM standard care management fee (on average), a $100 PMPM care management fee for patients with complex needs, a $4.00 PMPM performance incentive payment tied to quality and utilization metrics, and additional provisions on achieving improved care through health IT. Click here to read more.

Back to top

CMS Finalizes Mental Health Parity Rules

On March 30, 2016, CMS published final rules on mental health/substance use disorder parity requirements applicable to Medicaid managed care organizations (MCOs), Medicaid alternative benefit plans (ABPs), and CHIP. The final Medicaid/CHIP rules are based on the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), which generally prohibits more restrictive cost-sharing (e.g., co-payments and deductibles), quantitative limitations (e.g., visit limits), and non-quantitative limitations in mental health/substance use disorder benefits under a health plan than in medical/surgical coverage under the same plan. Click here to read more.

Back to top

CMS Announces Extension of SHOP Direct Enrollment Transition

On April 18, 2016, CMS released guidance entitled “Extension of state-based SHOP Direct Enrollment Transition,” which extends the option of direct enrollment until the end of 2018 giving state based SHOPs more time to make online enrollment available. In order to allow facilitation of enrollment without SHOP portal functionality, CMS has allowed states to direct enroll employers and their employees, while also extending the small business tax credits to those eligible small employers offering coverage on a state-based SHOP utilizing direct enrollment. Click here to read more.

Back to top

We want to hear from you!

Please do not hesitate to contact us with any questions or requests for additional information.  Also, if you have suggestions or feedback related to the newsletter, please let us know. Contact us today at

Contributing Subject Matter Experts:

  • Thomas Entrikin
  • Lisa Kaplan Howe
  • Margot Thistle

Leave a Reply

%d bloggers like this: