Weekly Health Care Policy Update – April 29, 2024

In this update: 

• Federal Agencies
  • CMS Finalizes Medicaid and CHIP Access, Finance, and Quality Rule
  • CMS Finalizes Ensuring Medicaid Access Rule
  • CMS Finalizes LTC Staffing Requirements Final Rule
  • CMS to Hold Quarterly Stakeholder Call on April 30^th
  • CMS Releases Update to its National Quality Strategy
  • HHS Issues Final Rule on Reproductive Privacy
  • FTC Announces Rule Banning Non-Compete Clauses
  • ONC Releases Common Agreement Version 2.0
• Other Updates
  • Joint Commission Launches Telehealth Accreditation Program
  • PCORI Announces $150 Million in New Health Research
• New York State Updates
  • OMH, OASAS, and SED to Host Joint Webinar on Scope of Practice Following Sunset of Social Work Exemption
  • NY School-Based Health Foundation Announces Implementation of STRONG Model Support for SBHCs

Federal Agencies

CMS Finalizes Medicaid and CHIP Access, Finance, and Quality Rule
On April 22^nd, the Centers for Medicare and Medicaid Services (CMS) released the Medicaid and Children’s Health Insurance Program (CHIP) Managed Care Access, Finance, and Quality Final Rule. Notably, the rule overhauls the Medicaid State-directed payment (SDP) regulations, which New York and other states use extensively to implement various payment modifications in Medicaid managed care. It also sets new standards for timely access to care, including maximum appointment wait times, and requires plan disclosure of provider reimbursement rates (aggregated by provider type).

Other provisions of the rule modify regulations on states’ monitoring and enforcement efforts; quality, fiscal, and program integrity standards; health-related social needs (HRSNs); medical loss ratio (MLR) requirements; and establishes a quality rating system for Medicaid and CHIP managed care plans. Major provisions of the rule are described below.

Access
The final rule establishes new access requirements, including: 

• Managed care plans must meet new maximum appointment wait time standards:
  • 15 business days for routine primary care and OB/GYN services;
  • 10 business days for outpatient mental health and substance use disorder treatment; and
  • States must select one additional provider type and establish a maximum wait time for that type.
• States must employ an independent entity to conduct annual secret shopper surveys on:
  • Compliance with new appointment wait time requirements; and
  • Provider directory accuracy (active network status, address, phone number, and accepting new enrollees).
• Each plan must annually conduct an enrollee experience survey, which states will submit to CMS.
• Each plan must annually submit a comparison of their provider reimbursement rates to benchmarks. This includes:
  • A comparison to Medicare payment rates for CPT codes for primary care, OB/GYN services, mental health services, and SUD services; and
  • A comparison to State Medicaid fee-for-service (FFS) payments for homemaker services, home health aide services, and personal care services.

State-Directed Payments 
The final rule enacts CMS’s proposed overhaul of SDP processes mostly as proposed, including: 

• Further categorization of value-based purchasing (VDP) SDPs into “performance-based” and “condition or population-based” arrangements, with different rules pertaining to each type.
• Codification of the authority for VBP SDPs to last up to three rating periods.
• Allowing states to require plans to set reimbursement to 100% of Medicare without CMS’s prior approval.
• A maximum limit on SDPs increasing rates for hospital and nursing home provider types, set at the average commercial rate (ACR), and accompanying reporting requirements.
• New requirements for states to provide evaluation plans and metrics for SDPs whose total cost exceeds 1.5% of the capitation.
• New requirement for States to ensure SDPs compliance with Medicaid financing rules. Specifically, they must obtain attestations from providers receiving funds under an SDP that they “do not participate in any hold harmless arrangement” related to a health care-related tax that funds Medicaid. If the State cannot obtain these attestations, they must provide an explanation to CMS.

A major change from the proposed rule is that, instead of placing new limits on the use of separate payment terms, the final rule will prohibit them entirely, starting in 2028. CMS believes that the use of separate payment terms “erodes the risk-based nature of payment to managed care plans.” CMS suggests that valid uses for separate payment terms may be enacted through the broader value-based payment (VBP) authority for SDPs established under this rule.

Medical Loss Ratio 
The final rule expands MLR reporting requirements with: 

• Requirement for Medicaid managed care plans to submit actual expenditures and revenues for SDPs as part of MLR reports.
• Requirement for managed care plans to report any identified or recovered overpayments to states within 30 calendar days.

In Lieu of Service and Setting (ILOS): 
The final rule includes new clarifications and rules on the use of ILOS, as previously set down in guidance: 

• ILOSs can be used as immediate or longer-term substitutes for a covered service or setting, or when the ILOSs can be expected to reduce or prevent the future need for such service or setting, to better support health-related social needs.
• ILOS must be considered approvable as a service or setting through the Medicaid state plan or a Medicaid section 1915(c) waiver.
• Total spending on ILOS must be no higher than 5% of total capitation payments for each program. States must perform an evaluation after five years if the ILOS costs exceed 1.5% as a percentage of total capitation payments.

Quality 
The final rule requires that states use their Medicaid and CHIP Quality Rating System website as a “one-stop-shop” for beneficiaries to access information about Medicaid and CHIP eligibility and managed care, compare managed care plans, and select plans.

The text of the final rule is here. The rule is effective July 9, 2024, with effective dates for new rules on SDPs largely pushed back to 2028. A fact sheet is available here.

CMS Finalizes Ensuring Medicaid Access Rule 
On April 22^nd, CMS finalized the Ensuring Access to Medicaid Services Rule. This rule intends to advance access to and quality of care for Medicaid beneficiaries across fee-for-service and managed care, including home- and community-based services (HCBS). Key provisions of the rule include:

Medicaid Advisory Committee and Beneficiary Advisory Council

• Renames states’ Medical Care Advisory Committees to Medicaid Advisory Committees (MAC), and includes a requirement that 25% of MAC members be drawn from a newly-formed Beneficiary Advisory Council (BAC), comprised of Medicaid members, their families, and/or caregivers;
• Requires that MAC/BAC activities (including an annual report) to be publicly available, including two meetings per year open to the public; and
• Requires states to provide staff to support MAC/BAC activities.

Home- and Community-Based Services 

• Strengthens oversight of HCBS person-centered service planning;
• Requires that states ensure a minimum of 80% of Medicaid payments for homemaker, home health aide, and personal care services be spent on compensation for direct care workers in six years, and requires reporting on readiness to collect such payment data in three years;
• Requires states to establish a hardship exemption for the 80% payment requirement; and
• Requires states to report on waiting lists for Section 1915(c) waiver programs, service delivery timeliness for personal care, homemaker, home health aide, and habilitation services, and a standardized set of HCBS quality measures.

Fee-for-Service

• Requires states to establish an advisory group for direct care workers, beneficiaries, beneficiaries’ authorized representatives, and other interested parties to advise on payment rates paid to direct care workers for personal care, home health aide, homemaker, and habilitation services; and
• Requires states to demonstrate access sufficiency through an initial analysis when submitting a state plan amendment with a rate reduction or restructuring.

More information is available here. 

CMS Finalizes LTC Staffing Requirements Final Rule
On April 22^nd, CMS issued the Minimum Staffing Standards for Long-Term Care (LTC) Facilities and Medicaid Institutional Payment Transparency Reporting Final Rule. Key provisions of the rule include: 

• Minimum Nurse Staffing Standards: Medicare- and Medicaid-certified long term care facilities will be subject to total nurse staffing standards of 3.48 hours per resident day (HPRD). This must include at least 0.55 HPRD of direct registered nurse care and 2.45 HPRD of direct nurse aide care.
• RN On-Site Requirement: The rule requires LTC facilities to have a registered nurse (RN) on-site 24 hours a day, seven days a week, available to provide direct resident care.
• Facility Assessment Requirement: The rule strengthens the current facility-wide assessment by requiring facilities to use evidence-based methods when care planning for their residents; to adjust assessments based on any significant changes in the resident population; and to include the input of nursing home leadership, residents, resident representatives, and family members.
• Regulatory Flexibility: The rule allows for hardship exemptions to the HPRD and 24/7 RN requirement in certain circumstances, including where the supply of RN, NA or total nurse staff is not sufficient to meet area needs.
• Payment Transparency: The rule requires states to report to CMS on the percentage of Medicaid payments for services and nursing facilities and ICFs/IID spent on compensation for direct care workers and support staff.

The rule will be implemented over several years: 

• Facilities must meet the facility assessment requirements within 90 days of final rule publication.
• Facilities must meet the 3.48 HPRD total nurse staffing requirement and the 24/7 RN requirement within two years of final rule publication (three years for rural facilities).
• Facilities must meet the 0.55 RN and 2.45 NAHPRD requirements within three years of the final rule publication (five years for rural facilities).

The fact sheet is available here.

CMS to Hold Quarterly Stakeholder Call on April 30^th 
On April 30^th at 1pm, the Centers for Medicare and Medicaid Services (CMS) will host its quarterly National Stakeholder Call. On the call, Administrator Chiquita Brooks-LaSure and CMS senior leadership will address recent accomplishments as well as an update on Strategic Plan progress. Stakeholders are invited to join and learn about upcoming opportunities for engagement with CMS.

The RSVP is available here.

CMS Releases Update to its National Quality Strategy 
On April 8^th, CMS released an update to its National Quality Strategy. Originally launched in 2022, the Strategy is intended to be a long-term initiative to advance person-centric care with the aim of promoting quality and safety for all beneficiaries. This update details recent steps towards achieving the strategy’s four major goals: 

• Improved health outcomes;
• Advancing equity and engagement;
• Supporting safe and resilient health systems; and
• Promoting interoperability and innovation.

The strategy document is available here.

HHS Issues Final Rule on Reproductive Privacy 
On April 22^nd, the Department of Health and Human Services (HHS) issued the Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule to Support Health Care Privacy. Broadly, the final rule strengthens HIPAA privacy rules by prohibiting disclosure of protected health information (PHI) related to lawful reproductive health care in certain circumstances. The rule applies to covered health care providers, health plans, and health care clearinghouses (“covered entities”), or their business associates (collectively, “regulated entities”).

The rule prohibits the use or disclosure of PHI when it is sought to investigate or impose liability on individuals, providers, or others who seek, obtain, provide, or facilitate reproductive health care that is lawful under the circumstances, or to identify individuals for such activities. Further, regulated entities must obtain a signed attestation that requests for PHI potentially related to reproductive health care are not for these prohibited purposes. Finally, regulated entities must modify their Notice of Privacy Practices to support these ends. The rule will become effective June 23^rd and regulated entities are expected to comply with the majority of provisions by December 22^nd.

The announcement is available here, and the fact sheet is available here.

FTC Announces Rule Banning Non-Compete Clauses
On April 23^rd, the Federal Trade Commission FTC) issued a final rule banning non-compete clauses nationwide. The rule was approved by a party-line 3-2 vote. Currently, an estimated one in five Americans in the workforce (30 million) are subject to a non-compete clause, including an increasing number of physicians and nurses, particularly in rural areas. To be in compliance with the rule, affected employers must stop enforcing existing non-compete clauses with covered workers and not initiate any in the future. This includes any worker regardless of title, job function, or compensation.

The rule does not apply to existing non-competes with senior executives in a “policy-making position” (generally a president, CEO, or equivalent) earning more than $151,164. Non-competes that are tied to the sale of a business are also not affected by this rule. Given limitations on the FTC’s jurisdiction, this rule does not apply to non-profit hospitals, so long as entities claiming tax-exempt status are “in fact profit-making enterprises,” based on the FTC’s two-part test that there is an “adequate nexus” with its public purposes and that “net proceeds” are properly devoted to recognized public interests.

On April 24^th, the U.S. Chamber of Commerce and the Business Roundtable sued the FTC in federal district court in Dallas, arguing that the FTC exceeded its authority in finalizing the rule.

The rule is scheduled to take effect in August. The announcement is available here.

ONC Releases Common Agreement Version 2.0
On April 22^nd, the HHS Office of the National Coordinator for Health Information Technology (ONC), in partnership with the Sequoia Project, announced the release of the Common Agreement Version 2.0. The Common Agreement defines the infrastructure model and governing approach for the secure sharing of clinical information between health information networks and their users. It will be adopted by the seven Qualified Health Information Networks (QHINs) currently designated under the Trusted Exchange Framework and Common Agreement (TEFCA).

Notably, Version 2.0 requires support for Fast Healthcare Interoperability Resources (FHIR) Application Programming Interface (API) exchange, which allows for easier and more direct information exchange between participants, as well as for individuals to access their own health care information using apps of their choice.

More information is available here. A list of designated QHINs can be found here.

Other Updates

Joint Commission Launches Telehealth Accreditation Program 
On April 23^rd, the Joint Commission announced a new Telehealth Accreditation Program for eligible hospitals, ambulatory care, and behavioral health care organizations. The accreditation is based on meeting standards of care for telehealth care comparable to other Joint Commission accreditations. Given the unique nature of telehealth, this accreditation also requires streamlined emergency management standards, a standardized provider and patient education about telehealth platforms and devices, and new standards for equipment, devices, and connectivity. The accreditation will launch on July 1^st.
 
The announcement is available here.
 
PCORI Announces $150 Million in New Health Research
On April 23^rd, the Patient-Centered Outcomes Research Institute (PCORI) announced $150 million in funding for new patient-centered, comparative clinical effectiveness research (CER) studies. Across nine awards, researchers will investigate the clinical effectiveness of approaches to heart failure and asthma treatment, health system strategies to control hypertension, and existing medications for migraine prevention.
 
The announcement is available here and information on the awards is available here.

New York State Updates

OMH, OASAS, and SED to Host Joint Webinar on Scope of Practice Following Sunset of Social Work Exemption
On May 9^th from 1:30pm-3pm, the New York State (NYS) Office of Mental Health (OMH), Office of Addiction Services and Supports (OASAS), and State Education Department (SED) will host a webinar on the scope of practice and licensing process for the professions most commonly employed in OMH and OASAS programs. The webinar aims to clarify regulations and processes following the sunset of the “social work exemption” in 2022 and corresponding changes to scope of practice regulations, including the implementation of mental health practitioner diagnostic privileges and updates to Credentialed Alcoholism and Substance Abuse Counselor (CASAC) education and application requirements.
 
The presentation will include information on allowable activities, supervisory requirements for licensure, exemptions that may be applicable to staff in OMH and OASAS settings, and tips for navigating the professional licensure or permit process. OMH and OASAS will review some of the common questions received from programs regarding scope of practice, demonstrate how to access the information to answer these questions, and provide examples of how this applies to the activities in their settings.
 
Registration is available here.
 
NY School-Based Health Foundation Announces Implementation of STRONG Model Support for SBHCs
The NY School-Based Health Foundation is implementing a two-year program to support school-based health centers (SBHCs) in serving newcomer students in the downstate region. The program will provide training and site-specific coaching in the use of an evidence-based model known as the Supporting Transition Resilience in Newcomer Groups (STRONG) model. The STRONG model focuses on the adversity and trauma experienced by newcomers during transitions of migration and settlement in new schools and communities.
 
Additional details on the model are available here. Funding will cover New York City and the downstate counties of Westchester, Nassau, and Suffolk.
 
There will be a webinar and Q&A session on May 14^th from 3pm-4pm, registration for which is available here. Questions may be submitted to Lisa Perry at Lisa.Perry@NYSBHFoundation.org.