State Medicaid Director: Provider Rates A Priority for Upcoming Legislative Budget

State Medicaid Director Stephanie Stephens, in a speech given on September 27 at the 2022 North Texas State of Reform Health Policy Conference, stated that an HHS priority for the upcoming legislative budget is Medicaid provider rates.

Provider fees a priority

She said, in answer to a question about HHS's priorities for the upcoming biennial budget, "the legislative session will be here sooner than we think. And we have you may know we've put out our budget request for the next biennium. And so it's a reflection of some of the agency's priorities. Of course, we always have to target what we include in the budget, but there's a number of areas I would highlight.

"I think I've heard today a lot about workforce challenges and we certainly acknowledge the workforce challenges within the agency, but also among providers and our partners. And so we do have an item. Some of our items are what we call placeholders. And so there's still work being done to decide the exact request that will be making of the legislature.

"But we do have a couple of different ways in which we're looking at workforce. I would say one of them is directly with rates, which as the Medicaid director, we get a lot of feedback on rates. And so we have some placeholders which will further refine to address critical provider rate issues."

This hopefully bodes well for dental providers as well as other professions in obtaining a long-needed increase in rates.  As previously reported, Medicaid dental rates have only declined over the last decade.

The conference held at the Irving Convention Center at Las Colinas was organized by State of Reform, a health policy organization, that "is focused on bridging the gap between health care and the policy that governs it" and organizes such conferences around the country.

Alternative payment models

Another issue that Ms. Stephens raised was the desire for HHS to increase alternative payment models for MCOs.  This has been controversial for dental providers.

Ms. Stephens said, "Over the past five years, we have made progress in advancing value-based care and payment approaches. You may know that through our managed care contracts we have targets for the amount of payments between the managed care organizations and the providers that are in alternative payment models, and those percentages increased over time. So from 2018 to 2021, the targets increased from 10 to 25% for at-risk APMs and 25 to 50% for total APMs.

"And what we've seen is the managed care organizations have generally met those targets, but there's still continued opportunity to advance alternative payment models. We've generally seen that many of the alternative payment models focus on primary care, hospital services. We see less in the area of long-term services and supports. We also see that the alternative payment models are often built on a fee-for-service model and will provide an incentive for a provider around quality. But we see less full at-risk payment models.

And so moving forward, we will continue to promote the adoption of APMs. But based on the experience we've had over the last few years, as well as we have in Value-based Payment and Quality Improvement Advisory Committee, we are planning changes to provide a more comprehensive but still flexible framework for increasing the adoption of APMs that goes beyond just those targets. I think one of the things we've heard is the targets are helpful in moving the needle, but it's not the only thing that needs to happen. And so we're looking at how do we round out our approach to alternative payment models. And we think this will include recognizing partnerships that MCOs have on specific APM priorities and opportunities, incentivizing MCO achievement and quality and efficiency standards established by HHS, and then encouraging MCOs to address a full set of activities important for successful APMs such as provider engagement and data sharing.

"So what we're looking at is where the state has decided that a specific area is a priority. Can we get the MCOs incentives and credit for doing work in that area? And one of the things that's been discussed I think a lot today is social determinants of health. And so if there's work being done by MCOs and social determinants of health, can we incorporate that into our alternative payment model framework so that we're just not focused on the targets alone? And so we're working on these changes over this year and we look forward to sharing additional information and partnering with stakeholders over this effort over the next year."