New medicaid managed care protections rule offers states greater flexibility - Updata - Brief Article - Statistical Data Included

Healthcare Financial Management, Oct, 2001

Under a new proposed rule, Medicaid beneficiaries in health plans would receive protection similar to that afforded all health plan participants under patients' rights legislation now pending in Congress, yet states would have more flexibility to implement the Medicaid protections. Currently, about 19 million Americans (56 percent of all Medicaid beneficiaries) are enrolled in managed care plans.

The proposed rule, published in the August 20, 2001, Federal Register, replaces a Clinton administration final rule with comment period issued last January that was to have taken effect August 17, 2001. HHS Secretary Tommy Thompson said that the final rule exceeded the intent of the current statute and imposed excessive mandates on the healthcare industry.

The increased flexibility offered to the states in the new proposed rule includes greater leeway in determining how long a health plan has to review a complaint. States also would have the option to retain aspects of existing, local patient-protection programs.

The proposed rule also would provide for the following rights of Medicaid beneficiaries:

* Health plans would be required to pay for a beneficiary's emergency department care whenever and wherever the need arises;

* All beneficiaries would have the option of obtaining a second opinion from a qualified health professional;

* Women would be allowed direct access to a women's health specialist in the network for routine and preventive healthcare services;

* Health plans would be prohibited from establishing restrictions, such as gag rules, that would interfere with patient-provider communications;

* Health plans would be required to ensure that they have adequate network capacity to serve the expected enrollment in their service area;

* States would be required to approve marketing materials used by the health plan, and plans would be prohibited from using door-to-door, telephone, and other forms of "cold-call" marketing; and

* All plans would be required to have a system in place to accommodate enrollee grievances and appeals and to resolve these issues within state-established time frames of no longer than 90 days (45 days for managed care organizations), or within expedited time frames when the life or health of an enrollee is in jeopardy.

* Medicaid managed care plans would be required to provide their enrollees with comprehensive, easy-to-understand information about their plan.

Many key congressional Democrats, including Reps. Sherrod Brown (D-Ohio) and Henry Waxman (D-Calif.), expressed outrage over the new proposed rule. They argued that states' newfound flexibility will make it easy to circumvent the protections and that simply by issuing the new rule, the Bush administration has unnecessarily delayed implementation of the protections.

The original effective date of the previous final rule was April 2001, but the effective date was delayed until August 17, 2001. The proposed rule with comment period further delays the effective date of the final rule until August 16, 2002. Comments are due October 19, 2001.