Senate Bill S8360

                                 
BILL NUMBER: S8360

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the social services law, in relation to determination
and approval of reimbursement rates for managed care providers under
medicaid

 
PURPOSE OR GENERAL IDEA OF BILL:

To increase transparency and promptness in the annual capitated rate
development process for Medicaid managed care plans and allow the plans
to preview and request actuarial review of the rates.

 
SUMMARY OF SPECIFIC PROVISIONS:

The bill amends Social Services Law

Sections one and two amend § 364- j(18)(c) and (f) to add more detail to
the existing disclosure required of the Department of Health (DOH) to
plans before submitting rates to the Center for Medicare and Medicaid
              

Services (CMS) for approval. Additional disclosures would include the
actuarial certification letters and correspondence between the state and
CMS related to the rates, end other information and methodologies that
DOH had considered but did not use in the development of the proposed
rates.

The plans would then be able to spot errors in the department's assump-
tions and request an actuarial-soundness review of the rates at least
ten days prior to DOH's submission to CMS. If DOH grants the review, DOH
does not submit the rates to CMS until the review is completed. If DOH
declines the review, DOH provides a written explanation to the plans
giving clear reasons why the request is denied.

Section three sets forth the effective date.

 
JUSTIFICATION:

Most of the Medicaid program functions through managed care plans,
either the mainstream plans or the long-term care plans. The plans
receive a capitated rate, per member per month, that is expected by
state and federal law to be actuarially sound - sufficient to cover the
full risk of medical care for the patient population served by the plan,
and the administrative costs to negotiate all the provider contracts and
benefit delivers'. Downstream providers complain that they are manipu-
lated at the mercy of the plans. Plans complain that they are manipu-
lated at the mercy of the Medicaid program. This bill aims for course
correction at the most upstream point, the capitated rate itself.

The existing rate disclosure requirement is missing key information and
DOH has consistently been late informing the plans of their rates. For
example, the draft April 2020 rates were initially shared with plans in
late October 2020, more than six months after their effective date. As
of December, they continued to be revised and were not yet submitted to
CMS by the new year. Nonetheless plans continued to assume risk and
deliver services, not certain of their reimbursement rates. This bill
requires DOH to notify MMC plans of anticipated rates prior to the

effective date of the rates so that plans can effectively manage busi-
ness operations, member services and provider payments.

DOH has been using rates that are at the bottom of the actuarially
acceptable rate range. Current law allows plans to request an actuari-
al-soundness review of proposed rates but does not require a DOH
response. This bill will provide plans with the certainty they need.
Either their request will be reviewed before CMS submission, or it will
not and if not, they will be told why.

 
PRIOR LEGISLATIVE HISTORY:

Senate

2023- 2024: Vetoed

Assembly

2021-2022: A7910, Reported to rules

2023-2024: A5381, Vetoed

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately; provided that the amendments to
section 364-j of the social services law made by sections one and two of
this act shall not affect the repeal of such section and shall expire
and be deemed repealed therewith.  NEW YORK STATE SENATE INTRODUCER'S
MEMORANDUM IN SUPPORT submitted in accordance with Senate Rule VI, Sec.
1