CMS proposes new rule increasing fiscal accountability in Medicaid

Today, the Centers for Medicare & Medicaid Services (CMS) issued a notice of proposed rulemaking (NPRM) to strengthen the fiscal accountability of the Medicaid program and ensure that state supplemental payments and financing arrangements are transparent and value-driven. CMS is proposing specific reporting requirements to assure that the billions of public dollars spent benefits Medicaid beneficiaries and providers by promoting access to medically necessary health care services consistent with efficiency, economy and quality of care. Putting patients first is one of CMS’s top priorities, and the Medicaid Fiscal Accountability Regulation (CMS-2393-P) is an important step in that effort.

The Medicaid Fiscal Accountability Regulation (MFAR) intends to ensure accountability of state financing, transparency of payments, and the fiscal integrity of the Medicaid program through numerous clarifications to Medicaid oversight rules. Specifically, this NPRM proposes to clarify existing financial policies, many of which have been previously described in sub-regulatory guidance issued by CMS and through our work with states. More significantly, the proposed rule would establish new requirements for states to report provider-level information on Medicaid supplemental payments, responding to numerous calls from oversight organizations to make those payments more transparent. Additionally, the proposed rule would periodically sun-set supplemental payment methodologies and require more details on the purposes of those payments, allowing CMS and states to regularly re-evaluate their effects. The rule would also take multiple steps to eliminate state financing gimmicks that cost the federal government millions each year.

Through this regulation, CMS is taking historic steps to increase oversight and improve fiscal integrity of the Medicaid program and further our goals of transforming Medicaid by putting patients first, increasing state flexibility, and ensuring accountability and integrity of the program.

• Proposed Rule: Medicaid Fiscal Accountability Regulation (MFAR)