The Obama administration released new rules Monday for private insurance companies that offer managed care plans through Medicaid.
Similar to initiatives the administration has imposed on insurers participating in the Patient Protection and Affordable Care Act (PPACA) marketplace, some of the new rules are aimed at making sure that those enrolled in Medicaid plans have reasonable access to doctors and medical facilities in their area.
Roughly two-thirds of the 72 million Medicaid enrollees get their services through a third party insurer. The rate of private sector participation in Medicaid differs by state, with some states still operating Medicaid entirely on their own and others that rely entirely on private insurers.
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Some of the new rules will largely serve as suggestions for states, which will have the discretion to design the specifics. The administration will require, for instance, that states put in place rules that specify the number of in-network providers within a certain distance of the customer's address. But the maximum distance could vary significantly by state.
The new rules also set stricter constraints on what insurers can do with their revenue. The rates that insurers charge state governments and individual customers for their plans should be based on the assumption that 85 percent of their revenue is spent on medical services.
Just as they did with marketplace plans, the feds are also demanding that Medicaid plans regularly update the directory of in-network doctors on their websites. PPACA customers have complained that it is often difficult to know which providers are included in plans that they sign up for, and that they are often hit with big bills at out-of-network providers that they believed were included.
"(T)he state must establish, at a minimum, network adequacy …. standards for specified provider types," said the report.
The report further noted that standards must be set for specific areas of medicine, such as pediatric and dental care. A large percentage of Medicaid enrollees are children, it noted, but some networks are woefully deficient when it comes to pediatricians.
"We're taking a major step forward in our efforts to strengthen Medicaid and the Children's Health Insurance Program," Vikki Wachino, deputy administrator for the Centers for Medicare and Medicaid Services, told Kaiser Health News.
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