42 CFR § 447.203 - Documentation of access to care and service payment rates.
(a) The agency must maintain documentation of payment rates and make it available to HHS upon request.
(b)
(1) Payment rate transparency. The State agency is required to publish all Medicaid fee-for-service fee schedule payment rates on a website that is accessible to the general public.
(i) For purposes of this paragraph (b)(1), the payment rates that the State agency is required to publish are Medicaid fee-for-service fee schedule payment rates made to providers delivering Medicaid services to Medicaid beneficiaries through a fee-for-service delivery system.
(ii) The website where the State agency publishes its Medicaid fee-for-service payment rates must be easily reached from a hyperlink on the State Medicaid agency's website.
(iii) Medicaid fee-for-service payment rates must be organized in such a way that a member of the public can readily determine the amount that Medicaid would pay for a given service.
(iv) In the case of a bundled payment methodology, the State must publish the Medicaid fee-for-service bundled payment rate and, where the bundled payment rate is based on fee schedule payment rates for each constituent service, must identify each constituent service included within the rate and how much of the bundled payment is allocated to each constituent service under the State's methodology.
(v) If the rates vary, the State must separately identify the Medicaid fee-for-service payment rates by population (pediatric and adult), provider type, and geographical location, as applicable.
(vi) The initial publication of the Medicaid fee-for-service payment rates shall occur no later than July 1, 2026 and include approved Medicaid fee-for-service payment rates in effect as of July 1, 2026. The agency is required to include the date the payment rates were last updated on the State Medicaid agency's website and to ensure these data are kept current where any necessary update must be made no later than 1 month following the latter of the date of CMS approval of the State plan amendment, section 1915(c) HCBS waiver amendment, or similar amendment revising the provider payment rate or methodology, or the effective date of the approved amendment. In the event of a payment rate change that occurs in accordance with a previously approved rate methodology, the State will ensure that its payment rate transparency publication is updated no later than 1 month after the effective date of the most recent update to the payment rate.
(2) Comparative payment rate analysis and payment rate disclosure. The State agency is required to develop and publish a comparative payment rate analysis of Medicaid fee-for-service fee schedule payment rates for each of the categories of services in paragraphs (b)(2)(i) through (iii) of this section. If the rates vary, the State must separately identify the payment rates by population (pediatric and adult), provider type, and geographical location, as applicable. The State agency is further required to develop and publish a payment rate disclosure of the average hourly Medicaid fee-for-service fee schedule payment rates for each of the categories of services in paragraph (b)(2)(iv) of this section, as specified in paragraph (b)(3) of this section. If the rates vary, the State must separately identify the payment rates by population (pediatric and adult), provider type, geographical location, and whether the payment rate includes facility-related costs, as applicable.
(i) Primary care services.
(ii) Obstetrical and gynecological services.
(iii) Outpatient mental health and substance use disorder services.
(iv) Personal care, home health aide, homemaker, and habilitation services, as specified in § 440.180(b)(2) through (4) and (6), provided by individual providers and provider agencies.
(3) Comparative payment rate analysis and payment rate disclosure requirements. The State agency must develop and publish, consistent with the publication requirements described in paragraphs (b)(1) through (b)(1)(ii) of this section, a comparative payment rate analysis and a payment rate disclosure.
(i) For the categories of services described in paragraph (b)(2)(i) through (iii) of this section, the comparative payment rate analysis must compare the State agency's Medicaid fee-for-service fee schedule payment rates to the most recently published Medicare payment rates effective for the same time period for the evaluation and management (E/M) codes applicable to the category of service. The State must conduct the comparative payment rate analysis at the Current Procedural Terminology (CPT) or Healthcare Common Procedure Coding System (HCPCS) code level, as applicable, using the most current set of codes published by CMS, and the analysis must meet the following requirements:
(A) The State must organize the analysis by category of service as described in paragraphs (b)(2)(i) through (iii) of this section.
(B) The analysis must clearly identify the base Medicaid fee-for-service fee schedule payment rates for each E/M CPT/ HCPCS code identified by CMS under the applicable category of service, including, if the rates vary, separate identification of the payment rates by population (pediatric and adult), provider type, and geographical location, as applicable.
(C) The analysis must clearly identify the Medicare non-facility payment rates as established in the annual Medicare Physician Fee Schedule final rule effective for the same time period for the same set of E/M CPT/HCPCS codes, and for the same geographical location as the base Medicaid fee-for-service fee schedule payment rates, that correspond to the base Medicaid fee-for-service fee schedule payment rates identified under paragraph (b)(3)(i)(B) of this section, including separate identification of the payment rates by provider type.
(D) The analysis must specify the base Medicaid fee-for-service fee schedule payment rate identified under paragraph (b)(3)(i)(B) of this section as a percentage of the Medicare non-facility payment rate as established in the annual Medicare Physician Fee Schedule final rule identified under paragraph (b)(3)(i)(C) of this section for each of the services for which the base Medicaid fee-for-service fee schedule payment rate is published pursuant to paragraph (b)(3)(i)(B) of this section.
(E) The analysis must specify the number of Medicaid-paid claims and the number of Medicaid enrolled beneficiaries who received a service within a calendar year for each of the services for which the base Medicaid fee-for-service fee schedule payment rate is published pursuant to paragraph (b)(3)(i)(B) of this section.
(ii) For each category of services specified in paragraph (b)(2)(iv) of this section, the State agency is required to publish a payment rate disclosure that expresses the State's payment rates as the average hourly Medicaid fee-for-service fee schedule payment rates, separately identified for payments made to individual providers and provider agencies, if the rates vary. The payment rate disclosure must meet the following requirements:
(A) The State must organize the payment rate disclosure by category of service as specified in paragraph (b)(2)(iv) of this section.
(B) The disclosure must identify the average hourly Medicaid fee-for-service fee schedule payment rates by applicable category of service, including, if the rates vary, separate identification of the average hourly Medicaid fee-for-service fee schedule payment rates for payments made to individual providers and provider agencies, by population (pediatric and adult), provider type, geographical location, and whether the payment rate includes facility-related costs, as applicable.
(C) The disclosure must identify the number of Medicaid-paid claims and the number of Medicaid enrolled beneficiaries who received a service within a calendar year for each of the services for which the average hourly Medicaid fee-for-service fee schedule payment rates are published pursuant to paragraph (b)(3)(ii)(B) of this section.
(4) Comparative payment rate analysis and payment rate disclosure timeframe. The State agency must publish the initial comparative payment rate analysis and payment rate disclosure of its Medicaid fee-for-service fee schedule payment rates in effect as of July 1, 2025 as required under paragraphs (b)(2) and (b)(3) of this section, by no later than July 1, 2026. Thereafter, the State agency must update the comparative payment rate analysis and payment rate disclosure no less than every 2 years, by no later than July 1 of the second year following the most recent update. The comparative payment rate analysis and payment rate disclosure must be published consistent with the publication requirements described in paragraphs (b)(1)introductory text, (b)(1)(i) and (b)(1)(ii) of this section.
(5) Compliance with payment rate transparency, comparative payment rate analysis, and payment rate disclosure requirements. If a State fails to comply with the payment rate transparency, comparative payment rate analysis, and payment rate disclosure requirements in paragraphs (b)(1) through (b)(4) of this section, including requirements for the time and manner of publication, future grant awards may be reduced under the procedures set forth at 42 CFR part 430, subparts C and D by the amount of FFP CMS estimates is attributable to the State's administrative expenditures relative to the total expenditures for the categories of services specified in paragraph (b)(2) of this section for which the State has failed to comply with applicable requirements, until such time as the State complies with the requirements. Unless otherwise prohibited by law, deferred FFP for those expenditures will be released after the State has fully complied with all applicable requirements.
(6) Interested parties advisory group for rates paid for certain services.
(i) The State agency must establish an advisory group for interested parties to advise and consult on provider rates with respect to service categories under the Medicaid State plan, 1915(c) waiver, and demonstration programs, as applicable, where payments are made to the direct care workers specified in § 441.311(e)(1)(ii) for the self-directed or agency-directed services found at § 440.180(b)(2) through (4), and (6).
(ii) The interested parties advisory group must include, at a minimum, direct care workers, beneficiaries, beneficiaries' authorized representatives, and other interested parties impacted by the services rates in question, as determined by the State.
(iii) The interested parties advisory group will advise and consult with the Medicaid agency on current and proposed payment rates, HCBS payment adequacy data as required at § 441.311(e), and access to care metrics described in § 441.311(d)(2), associated with services found at § 440.180(b)(2) through (4) and (6), to ensure the relevant Medicaid payment rates are sufficient to ensure access to personal care, home health aide, homemaker, and habilitation services for Medicaid beneficiaries at least as great as available to the general population in the geographic area and to ensure an adequate number of qualified direct care workers to provide self-directed personal assistance services.
(iv) The interested parties advisory group shall meet at least every 2 years and make recommendations to the Medicaid agency on the sufficiency of State plan, 1915(c) waiver, and demonstration direct care worker payment rates, as applicable. The State agency will ensure the group has access to current and proposed payment rates, HCBS provider payment adequacy reporting information as described in § 441.311(e), and applicable access to care metrics as described in § 441.311(d)(2) for HCBS in order to produce these recommendations. The process by which the State selects interested party advisory group members and convenes its meetings must be made publicly available.
(v) The Medicaid agency must publish the recommendations produced under paragraph (b)(6)(iv) of the interested parties advisory group consistent with the publication requirements described in paragraph (b)(1) through (b)(1)(ii) of this section, within 1 month of when the group provides the recommendation to the agency.
(c)
(1) Initial State analysis for rate reduction or restructuring. For any State plan amendment that proposes to reduce provider payment rates or restructure provider payments in circumstances when the changes could result in diminished access where the criteria in paragraphs (c)(1)(i) through (iii) of this section are met, the State agency must provide written assurance and relevant supporting documentation that the following conditions are met as well as a description of the State's procedures for monitoring continued compliance with section 1902(a)(30)(A) of the Act, as part of the State plan amendment submission in a format prescribed by CMS as a condition of approval:
(i) Medicaid payment rates in the aggregate (including base and supplemental payments) following the proposed reduction or restructuring for each benefit category affected by the proposed reduction or restructuring would be at or above 80 percent of the most recently published Medicare payment rates for the same or a comparable set of Medicare-covered services.
(ii) The proposed reduction or restructuring, including the cumulative effect of all reductions or restructurings taken throughout the current State fiscal year, would be likely to result in no more than a 4 percent reduction in aggregate fee-for-service Medicaid expenditures for each benefit category affected by proposed reduction or restructuring within a State fiscal year.
(iii) The public processes described in paragraph (c)(4) of this section and § 447.204 yielded no significant access to care concerns from beneficiaries, providers, or other interested parties regarding the service(s) for which the payment rate reduction or payment restructuring is proposed, or if such processes did yield concerns, the State can reasonably respond to or mitigate the concerns, as appropriate, as documented in the analysis provided by the State pursuant to § 447.204(b)(3).
(2) Additional State rate analysis. For any State plan amendment that proposes to reduce provider payment rates or restructure provider payments in circumstances when the changes could result in diminished access where the requirements in paragraphs (c)(1)(i) through (iii) of this section are not met, the State must also provide the following to CMS as part of the State plan amendment submission as a condition of approval, in addition to the information required under paragraph (c)(1) of this section, in a format prescribed by CMS:
(i) A summary of the proposed payment change, including the State's reason for the proposal and a description of any policy purpose for the proposed change, including the cumulative effect of all reductions or restructurings taken throughout the current State fiscal year in aggregate fee-for-service Medicaid expenditures for each benefit category affected by proposed reduction or restructuring within a State fiscal year.
(ii) Medicaid payment rates in the aggregate (including base and supplemental payments) before and after the proposed reduction or restructuring for each benefit category affected by proposed reduction or restructuring, and a comparison of each (aggregate Medicaid payment before and after the reduction or restructuring) to the most recently published Medicare payment rates for the same or a comparable set of Medicare-covered services and, as reasonably feasible, to the most recently available payment rates of other health care payers in the State or the geographic area for the same or a comparable set of covered services.
(iii) Information about the number of actively participating providers of services in each benefit category affected by the proposed reduction or restructuring. For this purpose, an actively participating provider is a provider that is participating in the Medicaid program and actively seeing and providing services to Medicaid beneficiaries or accepting Medicaid beneficiaries as new patients. The State must provide the number of actively participating providers of services in each affected benefit category for each of the 3 years immediately preceding the State plan amendment submission date, by State-specified geographic area (for example, by county or parish), provider type, and site of service. The State must document observed trends in the number of actively participating providers in each geographic area over this period. The State may provide estimates of the anticipated effect on the number of actively participating providers of services in each benefit category affected by the proposed reduction or restructuring, by geographic area.
(iv) Information about the number of Medicaid beneficiaries receiving services through the FFS delivery system in each benefit category affected by the proposed reduction or restructuring. The State must provide the number of beneficiaries receiving services in each affected benefit category for each of the 3 years immediately preceding the State plan amendment submission date, by State-specified geographic area (for example, by county or parish). The State must document observed trends in the number of Medicaid beneficiaries receiving services in each affected benefit category in each geographic area over this period. The State must provide quantitative and qualitative information about the beneficiary populations receiving services in the affected benefit categories over this period, including the number and proportion of beneficiaries who are adults and children and who are living with disabilities, and a description of the State's consideration of the how the proposed payment changes may affect access to care and service delivery for beneficiaries in various populations. The State must provide estimates of the anticipated effect on the number of Medicaid beneficiaries receiving services through the FFS delivery system in each benefit category affected by the proposed reduction or restructuring, by geographic area.
(v) Information about the number of Medicaid services furnished through the FFS delivery system in each benefit category affected by the proposed reduction or restructuring. The State must provide the number of Medicaid services furnished in each affected benefit category for each of the 3 years immediately preceding the State plan amendment submission date, by State-specified geographic area (for example, by county or parish), provider type, and site of service. The State must document observed trends in the number of Medicaid services furnished in each affected benefit category in each geographic area over this period. The State must provide quantitative and qualitative information about the Medicaid services furnished in the affected benefit categories over this period, including the number and proportion of Medicaid services furnished to adults and children and who are living with disabilities, and a description of the State's consideration of the how the proposed payment changes may affect access to care and service delivery. The State must provide estimates of the anticipated effect on the number of Medicaid services furnished through the FFS delivery system in each benefit category affected by the proposed reduction or restructuring, by geographic area.
(vi) A summary of, and the State's response to, any access to care concerns or complaints received from beneficiaries, providers, and other interested parties regarding the service(s) for which the payment rate reduction or restructuring is proposed as required under § 447.204(a)(2).
(3) Compliance with requirements for State analysis for rate reduction or restructuring. A State that submits a State plan amendment that proposes to reduce provider payment rates or restructure provider payments in circumstances when the changes could result in diminished access that fails to provide the information and analysis to support approval as specified in paragraphs (c)(1) and (2) of this section, as applicable, may be subject to State plan amendment disapproval under § 430.15(c) of this chapter. Additionally, States that submit relevant information, but where there are unresolved access to care concerns related to the proposed State plan amendment, including any raised by CMS in its review of the proposal and any raised through the public process as specified in paragraph (c)(4) of this section or under § 447.204(a)(2), may be subject to State plan amendment disapproval. If State monitoring of beneficiary access after the payment rate reduction or restructuring takes effect shows a decrease in Medicaid access to care, such as a decrease in the provider-to-beneficiary ratio for any affected service, or the State or CMS experiences an increase in beneficiary or provider complaints or concerns about access to care that suggests possible noncompliance with the access requirements in section 1902(a)(30)(A) of the Act, CMS may take a compliance action using the procedures described in § 430.35 of this chapter.
(4) Mechanisms for ongoing beneficiary and provider input.
(i) States must have ongoing mechanisms for beneficiary and provider input on access to care (through hotlines, surveys, ombudsman, review of grievance and appeals data, or another equivalent mechanism), consistent with the access requirements and public process described in § 447.204.
(ii) States should promptly respond to public input through these mechanisms citing specific access problems, with an appropriate investigation, analysis, and response.
(iii) States must maintain a record of data on public input and how the State responded to this input. This record will be made available to CMS upon request.
(5) Addressing access questions and remediation of inadequate access to care. When access deficiencies are identified, the State must, within 90 days after discovery, submit a corrective action plan with specific steps and timelines to address those issues. While the corrective action plan may include longer-term objectives, remediation of the access deficiency should take place within 12 months.
(i) The State's corrective actions may address the access deficiencies through a variety of approaches, including, but not limited to: Increasing payment rates, improving outreach to providers, reducing barriers to provider enrollment, providing additional transportation to services, providing for telemedicine delivery and telehealth, or improving care coordination.
(ii) The resulting improvements in access must be measured and sustainable.
(6) Compliance actions for access deficiencies. To remedy an access deficiency, CMS may take a compliance action using the procedures described at § 430.35 of this chapter.