HHS Rescinds Medicaid Regulations

Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced June 29 that the administration will rescind all or part of three Medicaid regulations and delay the enforcement of a fourth regulation.

Secretary Sebelius said the actions “are necessary to ensure that the states have the flexibility they need to fully serve Medicaid-eligible individuals.”

“These regulations, if left in place would have potentially adverse consequences for Medicaid beneficiaries, some of our nation’s most vulnerable people,” said Secretary Sebelius.  “By rescinding these rules, we can expect that children will continue receiving services through their schools, beneficiaries will be able to access all available case management resources to help them better manage their health care, and outpatient hospital and clinic services can continue to be covered in the most efficient manner.”

Specifically, the Centers for Medicare & Medicaid Services (CMS) and HHS are:

  • Rescinding a final rule, published December 28, 2007, that eliminated Federal Medicaid payment for the costs of certain school-based administrative and transportation activities. Former HHS Secretary Michael Leavitt reasoned that such activities were not necessary for the proper and efficient administration of the Medicaid state plan. The current HHS administration has a different opinion and believes the rule could limit the Medicaid administrative outreach activities of schools, and that the overall budgetary impact on schools could potentially impact their ability to offer Medicaid services to students. This final rule was estimated to reduce Federal Medicaid outlays by $635 million in 2009 and by a total of $3.6 billion over the first five years, according to the former administration.
  • Rescinding a final rule, published November 7, 2008, intending to align the Medicaid definition of outpatient hospital service more closely to the Medicare definition to improve the functionality of the applicable upper payment limits, provide more transparency in determining available hospital coverage in any state, and generally clarify the scope of services for which federal financial participation (FFP) is available under the outpatient hospital services benefit category. CMS, however, has since decided this would create too much upheaval.
  • Rescinding provisions of an interim final rule published December 4, 2007 that restricted beneficiary access to case management services. These provisions appeared to, according to the current HHS administration, restrict beneficiary access to needed covered case management services, and limit state flexibility in determining efficient and effective delivery systems for case management services.
  • Delaying until June 30, 2010 the enforcement of portions of a regulation that clarified limitations on health care related tax programs so CMS could determine whether states need additional clarification or guidance. CMS may also further review the regulation’s potential impact, and give additional consideration to alternative approaches.

Each of these rules, in whole or in part, was subject to Congressional moratoria set to expire on July 1, according to a CMS press release.

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7 Responses to “HHS Rescinds Medicaid Regulations”

  1. Brenda Shepherd says:

    Regulations for Medicaid should not be rescinded but should move forward in order to save money for hard working taxpayers. There are too many loopholes as it is for people to receive Medicaid services. What has happened to personal responsibility for ourselves and our children??? The system is filled with so much abuse with baby after baby being born to girls that cannot seem to wait until they are capable of supporting, financially and emotionally, a child.

  2. Pamela Pully says:

    The extra services that Medicaid allows like school services, transportation and case management should be limited. It has not help people better manage their health care. We are fatter and less health then ever. I agree with Brenda that we need to save the tax payer money. Medicaid allows more services and more benefits then some health insurances working people have. Giving the states more flexibility opens opportunities for more fraud and abuse. The current system does help people to lead a health live style in fact it creates more dependence on the system. The rescinding of these rules will make the Medicaid system more costly. I would like to know how Secretary Sebelius can think this is good. The system has failed and needs to be changed. We should not take two steps backwards to the old practices. We need true preventive services and demand people be accountable for their own health.

  3. Scott Gullion says:

    Accountability for ones own health is a good step a person can take in their life but it shouldn’t be enforced. We live in a free society. The two that commented before me state that upper limits on outpatient services should not be rescinded. I’ve worked for an ASC and other practices all in an administrative capacity and I’ve seen how little Medicaid reimburses for services.. Medicaid often doesn’t not even cover the cost of the service or procedure.

    One of the practices I worked for dropped their Medicaid patients because the practice was losing money to service these patients. I am all for saving tax payers more money but Medicaid is getting to the point where many doctors and practices will not accept Medicaid patients due to low reimbursement payments. It doesn’t matter how many services Medicaid provides if no one is even willing to accept Medicaid.

    Medicaid needs to increase they payment plans, otherwise why have the government funded program at all?

  4. Christina says:

    I agree with brenda medicaid has made it to easy for women to have baby after baby with out thinking of who really pays. Medicaid was not put into place to be abused. I also agree with Pamela
    tax payers are paying into insurance plans that can have very limited benefits. Medicaid should put a limit on there benefits this way people are forced to be held accountable.

  5. Sally says:

    “certain school-based administrative and transportation activities” Is pretty ambiguous and looks like a wide open field for abuse of the system. I do not understand what role the schools have in administering medicaid benefits to students, isn’t the students’ healthcare needs the parents’ responsibility?

  6. Vicki A. says:

    I totally agree with Scott-accountability for your own health should be a priority for all peoples-however, there are many things that happen that have NOTHING to do with what you have done or not done for your own health! For instance, the bones in my neck have deteriorated due to degenerative disc disease to a point where I had to have 2 different neck operations to fix them-this had nothing to do with what I did or did not due-it sometimes comes with age! The point is, I had to go on welfare for I was unable to continue doing the work I once did(selling shoes). My doctor said I would just keep breaking them down if I continued doing a physical job. Medicaid truly pays doctors very little & it is true that there are soooo many who will not accept these patients due to the little they get for reimbursement-it’s horrible- to say the least!! If you’ve never been thru it I pray you never have to. I believe they pay my doctor something like 65 cents for my visit-who can you get for 65 cents!?! Finding a job with insurance is a whole other issue, especially when you now have limitations on your physical being, or the mental disabilities that some people deal with. ALL insurance is wide open to abuses-these days everyone wants something for nothing & I believe that no one way is best. We in America can at least have some form of coverage for the things that are NOT our fault & the Medicaid system should be in line with the other insurances as far as what they will pay-so that we will have doctors who will accept us as patients!!

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