[Federal Register: December 4, 2007 (Volume 72, Number 232)]
[Rules and Regulations]
[Page 68077-68093]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr04de07-10]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 431, 440, and 441
[CMS-2237-IFC]
RIN 0938-AO50
Medicaid Program; Optional State Plan Case Management Services
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Interim final rule with comment period.
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SUMMARY: This interim final rule with comment period revises current
Medicaid regulations to incorporate changes made by section 6052 of the
Deficit Reduction Act of 2005. In addition, it incorporates provisions
of the Consolidated Omnibus Budget Reconciliation Act of 1985, the
Omnibus Budget Reconciliation Act of 1986, the Tax Reform Act of 1986,
the Omnibus Budget Reconciliation Act of 1987, and the Technical and
Miscellaneous Revenue Act of 1988, concerning case management and
targeted case management services. This interim final rule with comment
period will provide for optional coverage of case management services
or targeted case management services furnished according to section
1905(a)(19) and section 1915(g) of the Social Security Act. This
interim final rule with comment period clarifies the situations in
which Medicaid will pay for case management activities and also
clarifies when payment will not be consistent with proper and efficient
operation of the Medicaid program, and is not available.
DATES: Effective Date: The effective date of this rule is March 3,
2008.
Comment date: To be assured consideration, comments must be
received at one of the addresses provided below, no later than 5 p.m.
on February 4, 2008.
ADDRESSES: In commenting, please refer to file code CMS-2237-IFC.
Because of staff and resource limitations, we cannot accept comments by
facsimile (FAX) transmission.
You may submit comments in one of four ways (no duplicates,
please):
1. Electronically. You may submit electronic comments on specific
issues in this regulation to http://www.cms.hhs.gov/eRulemaking. Click
on the link ``Submit electronic comments on CMS regulations with an
open comment period.'' (Attachments should be in Microsoft Word,
WordPerfect, or Excel; however, we prefer Microsoft Word.)
2. By regular mail. You may mail written comments (one original and
two copies) to the following address ONLY: Centers for Medicare &
Medicaid Services, Department of Health and Human Services, Attention:
CMS-2237-IFC, P.O. Box 8016, Baltimore, MD 21244-8016.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments (one
original and two copies) to the following address ONLY: Centers for
Medicare & Medicaid Services, Department of Health and Human Services,
Attention: CMS-2237-IFC, Mail Stop C4-26-05, 7500 Security Boulevard,
Baltimore, MD 21244-1850.
4. By hand or courier. If you prefer, you may deliver (by hand or
courier) your written comments (one original and two copies) before the
close of the comment period to one of the following addresses. If you
intend to deliver your comments to the Baltimore address, please call
telephone number (410) 786-7195 in advance to schedule your arrival
with one of our staff members. Room 445-G, Hubert H. Humphrey Building,
200 Independence Avenue, SW., Washington, DC 20201; or 7500 Security
Boulevard, Baltimore, MD 21244-1850.
(Because access to the interior of the HHH Building is not readily
available to persons without Federal Government identification,
commenters are encouraged to leave their comments in the CMS drop slots
located in the main lobby of the building. A stamp-in clock is
available for persons wishing to retain a proof of filing by stamping
in and retaining an extra copy of the comments being filed.)
Comments mailed to the addresses indicated as appropriate for hand
or courier delivery may be delayed and received after the comment
period.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Jean Close, (410) 786-5831.
SUPPLEMENTARY INFORMATION: Submitting Comments: We welcome comments
from the public on all issues set forth in this rule to assist us in
fully considering issues and developing policies. You can assist us by
referencing the file code CMS-2237-IFC and the specific ``issue
identifier'' that precedes the section on which you choose to comment.
[[Page 68078]]
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following Web
site as soon as possible after they have been received: http://www.cms.hhs.gov/eRulemaking.
Click on the link ``Electronic Comments on
CMS Regulations'' on that Web site to view public comments.
Comments received timely also will be available for public
inspection as they are received, generally beginning approximately 3
weeks after publication of a document, at the headquarters of the
Centers for Medicare & Medicaid Services, 7500 Security Boulevard,
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30
a.m. to 4 p.m. To schedule an appointment to view public comments,
phone 1-800-743-3951.
I. Background
[If you choose to comment on issues in this section, please include
the caption ``Background'' at the beginning of your comments.]
Case management is commonly understood to be an activity that
assists individuals in gaining access to necessary care and services
appropriate to their needs. Many individuals, because of their age,
condition, illness, living arrangement, or other factors, may benefit
from receiving direct assistance in gaining access to services. In the
context of this regulation, it is the individual's access to care and
services that is the subject of this management--not the individual.
Because case management has been subject to so many different
interpretations over the years, many Medicaid agencies now refer to
case management as ``care management,'' ``service coordination,''
``care coordination'' or some other term related to planning and
coordinating access to health care and other services on behalf of an
individual. Because section 1915 of the Social Security Act (the Act)
uses the term ``case management,'' we will use this term throughout
this document.
In 1981, the Congress amended the Act to authorize Medicaid
coverage of case management services under two provisions. Under
section 1915(b) of the Act, States were authorized to develop primary
care case management systems in order to direct individuals to
appropriate Medicaid services. Under section 1915(c) of the Act, States
were authorized to furnish case management as a distinct service under
home and community-based services waivers. Case management is widely
used under both authorities because of its value in ensuring that
individuals receiving Medicaid benefits are assisted in making
necessary decisions about the care they need and in locating service
providers.
The regulations set forth in this interim final regulation
implement in 42 CFR parts 431, 440, and 441 the case management
services provisions authorized by sections 1905(a)(19) of the Act and
1915(g) of the Act. The definition of case management in the Deficit
Reduction Act was effective on January 1, 2006. The provisions of this
rule are effective 90 days after the date of publication of this rule.
II. Legislative History
A. Changes Made by the Consolidated Omnibus Budget Reconciliation Act
of 1985
Section 9508 of the Consolidated Omnibus Budget Reconciliation Act
of 1985 (COBRA) (Pub. L. 99-272), enacted on April 7, 1986, amended the
Act concerning the provision of targeted case management services.
Specifically, section 9508 of COBRA added a new section 1915(g) to the
Act that--
Provided that a State may elect to furnish case
management, targeted to specified groups, as a service covered under
the State plan;
Defined case management services as services that will
assist individuals, eligible under the State plan, in gaining access to
needed medical, social, educational, and other services;
Provided an exception to the statewideness requirement of
section 1902(a)(1) of the Act by allowing a State to limit its
provision of case management services to individuals who reside in
particular geographic areas or political subdivisions within the State;
Provided an exception to the comparability requirement of
section 1902(a)(10)(B) of the Act by allowing a State to furnish case
management services to any specific group (targeted case management);
and
Required that there be no restriction on free choice of
providers of case management services that would violate section
1902(a)(23) of the Act.
B. Changes Made by the Omnibus Budget Reconciliation Act of 1986
Section 9411(b) of the Omnibus Budget Reconciliation Act of 1986
Pub. L. 99-509, enacted on October 21, 1986, amended section 1915(g) of
the Act by clarifying that a State may limit the provision of case
management services to individuals with acquired immune deficiency
syndrome (AIDS), AIDS-related conditions, or with either. Section
1915(g) of the Act also was amended to clarify that a State may limit
case management services to individuals with chronic mental illness.
C. Changes Made by the Tax Reform Act of 1986
Section 1895(c)(3) of the Tax Reform Act of 1986 (Pub. L. 99-514),
enacted on October 22, 1986, amended the statute to permit States to
furnish non-targeted case management services under a State Medicaid
plan. This law amended section 1905(a) of the Act by adding a new
paragraph (19) that included case management services, as defined in
section 1915(g)(2) of the Act, in the list of optional services a State
may include in its Medicaid plan (the existing paragraph (19) was
redesignated as paragraph (20)).
D. Changes Made by the Omnibus Budget Reconciliation Act of 1987
Section 4118(i) of the Omnibus Budget Reconciliation Act of 1987
(OBRA '87) Pub. L. 100-203, enacted on December 22, 1987, amended
section 1915(g)(1) of the Act to allow States to limit the providers of
case management services available for individuals with developmental
disabilities or chronic mental illness to ensure that the case managers
for those individuals are capable of ensuring that those individuals
receive needed services.
E. Changes Made by the Technical and Miscellaneous Revenue Act of 1988
Section 8435 of the Technical and Miscellaneous Revenue Act of 1988
(Pub. L. 100-647), enacted on November 10, 1988, prohibited the
Secretary from denying approval of a State plan amendment to provide
case management services on the basis that a State is required to
provide those services under State law or on the basis that the State
had paid or is paying for those services from other non-Federal revenue
sources before or after April 7, 1986. This provision also specified
that the Secretary was not required to make payment under Medicaid for
case management services that are furnished without charge to the users
of such services.
F. Changes Made by the Deficit Reduction Act of 2005
Section 6052 of the Deficit Reduction Act (DRA) of 2005 (Pub. L.
109-171), enacted on February 8, 2006, addresses Reforms of Case
Management and Targeted Case Management under Medicaid. This section
redefined the
[[Page 68079]]
term ``case management services'' to mean services that will ``assist
individuals eligible under the State plan in gaining access to needed
medical, social, educational, and other services'' and to include the
following components:
Assessment of an eligible individual to determine service
needs, including activities that focus on needs identification, to
determine the need for any medical, educational, social, or other
services. These activities are defined to include the following:
--Taking client history.
--Identifying the needs of the individual, and completing related
documentation.
--Gathering information from other sources, such as family members,
medical providers, social workers, and educators, if necessary, to form
a complete assessment of the eligible individual.
Development of a specific care plan based on the
information collected through the assessment described above. The care
plan specifies the goals of providing case management to the eligible
individual and actions to address the medical, social, educational, and
other services needed by the eligible individual, including activities
such as ensuring the active participation of the eligible individual
and working with the individual (or the individual's authorized health
care decision maker) and others to develop such goals and identify a
course of action to respond to the assessed needs of the eligible
individual.
Referral and related activities to help an individual
obtain needed services, including activities that help link the
eligible individual with medical, social, educational providers, or
other programs and services that are capable of providing needed
services, such as making referrals to providers for needed services and
scheduling appointments for the individual.
Monitoring and follow-up activities, including activities
and contacts that are necessary to ensure that the care plan is
effectively implemented and adequately addresses the needs of the
eligible individual. Monitoring and follow-up activities may be with
the individual, family members, providers, or other entities. These
activities may be conducted as frequently as necessary to help
determine such matters as:
--Whether services are being furnished in accordance with the
individual's care plan.
--Whether the services in the care plan are adequate to meet the needs
of the individual.
--Whether there are changes in the needs or status of the individual.
If there are changes in the needs or status of the individual,
monitoring and follow-up activities include making necessary
adjustments in the care plan and service arrangements with providers.
Section 6052 of the DRA also clarifies that the term ``case
management'' does not include the ``direct delivery of an underlying
medical, educational, social, or other service to which an eligible
individual has been referred'' by adding clause section
1915(g)(2)(A)(iii) of the Act. In addition, with respect to foster
care, the statute gives examples of some types of activities that are
not covered. With respect to the direct delivery of foster care
services, the following activities are not considered to qualify as
components of Medicaid case management services:
Research gathering and completion of documentation
required by the foster care program;
Assessing adoption placements;
Recruiting or interviewing potential foster care parents;
Serving legal papers;
Home investigations;
Providing transportation;
Administering foster care subsidies; or
Making placement arrangements.
The DRA also added a new section 1915(g)(2)(B) to the Act, defining
the term ``targeted case management services'' as case management
services that are furnished without regard to the requirements of
section 1902(a)(1) of the Act, regarding statewide availability of
services, and section 1902(a)(10)(B) of the Act, regarding
comparability of services. Although the ability to provide these
services without regard to section 1902(a)(1) of the Act and section
1902(a)(10)(B) of the Act is not new, this paragraph clarifies that the
State can ``target'' case management services to specific classes of
individuals, or to individuals who reside in specified areas of the
State (or both).
Section 6052 of the DRA also added a new section 1915(g)(3) to the
Act, to clarify that when a case manager contacts individuals who are
not eligible for Medicaid, or who are Medicaid eligible but not
included in the eligible target population in the State, that contact
may qualify as Medicaid case management services. The contact is
considered an allowable case management activity when the purpose of
the contact is directly related to the management of the eligible
individual's care. It is not considered an allowable case management
activity if those contacts relate directly to the identification and
management of the non-eligible or non-targeted individual's needs and
care.
Section 6052 of the DRA added a new section 1915(g)(4) to the Act
to discuss the circumstances under which Federal financial
participation (FFP) is available for case management or targeted case
management services. With a few exceptions described in the following
paragraph, in accordance with section 1902(a)(25) of the Act, FFP only
is available for the cost of case management or targeted case
management services if there are no other third parties liable to pay
for those services, including as reimbursement under a medical, social,
educational, or other program. When the costs of any part of case
management or targeted case management services are reimbursable under
another federally funded program, a State is directed to allocate the
costs between the other program(s) and Medicaid in accordance with OMB
Circular (No. A-87) (or any related or successor guidance or
regulations regarding allocation of costs among Federally funded
programs) under an approved cost allocation program.
It should be noted that per section 1903(c) of the Act, nothing in
this rule would prohibit or restrict payment for medical assistance for
covered Medicaid services furnished to a child with a disability
because such services are included in the child's Individualized
Education Program (IEP) or Individual Family Service Plan (IFSP).
Likewise, payment for those services that are included in the IEP or
IFSP would not be available when those services are not covered
Medicaid services.
Section 6052 of the DRA also clarified, in a new section 1915(g)(5)
of the Act, that nothing in section 1915(g) of the Act shall be
construed as affecting the application of rules with respect to third
party liability under programs or activities carried out under title
XXVI of the Public Health Service Act (the HIV Health Care Services
Program) or the Indian Health Service.
This rule implements in Federal regulations the statutory
provisions permitting coverage of case management and targeted case
management as optional services under a State Medicaid plan, in
accordance with sections 1905(a)(19) and 1915(g) of the Act, as amended
by the DRA, and all other relevant statutory provisions.
III. Provisions of the Interim Final Rule
[If you choose to comment on issues in this section, please
indicate the caption ``Provisions of the Interim Final
[[Page 68080]]
Rule'' at the beginning of your comments.]
To incorporate the policies and implement the statutory provisions
described above, we are making the following revisions to 42 CFR
chapter IV, subchapter C, Medical Assistance Programs.
A. Freedom of Choice Exception To Permit Limitation of Case Management
Providers for Certain Target Groups--Sec. 431.51(c)
While the freedom of choice requirement is beneficial to the
Medicaid population as a whole, in OBRA '87, the Congress recognized
that this requirement might not adequately protect the interests of
persons with a developmental disability or chronic mental illness. In
several States (or political subdivision), a particular agency may be
designated under State law or regulation to serve as the exclusive
source of case management services with respect to these populations.
Therefore, section 4118(i) of OBRA '87 amended section 1915(g)(1) of
the Act to provide States with some latitude to restrict the
availability of case management providers to these targeted groups to
assure that case management providers are capable of ensuring that
Medicaid eligible individuals will receive needed services.
Consistent with section 1915(g) of the Act, as amended by section
4118(i) of OBRA '87, when a target group consists solely of individuals
with developmental disabilities or chronic mental illness, including a
subgroup of those individuals (for example, children with mental
illness), States may limit provider participation to specific persons
or entities by setting forth qualifying criteria that assure the
ability of the case managers to connect individuals with needed
services. We note, however, that a State's decision to restrict case
managers for these populations does not impinge on targeted
individuals' rights to choose freely among those individuals or
entities that the State has found qualified and eligible to provide
targeted case management services. Absent a waiver to the contrary,
those individuals also maintain their right to choose qualified
providers of all other Medicaid services they receive.
We are amending Sec. 431.51 by revising paragraphs (c)(2) and
(c)(3) and adding a new paragraph (c)(4) to afford States the option of
limiting providers of case management services available to furnish
services defined in Sec. 440.169 for targeted groups that consist
solely of individuals with developmental disabilities or chronic mental
illness. This implements the statutory provisions at section 1915(g)(1)
of the Act.
B. Statewideness and Comparability Exception to Permitting Targeting--
Sec. 431.54
While a State can provide case management services under its State
plan to all Medicaid eligible individuals, it is not required to do so.
Under section 1915(g)(1) of the Act, a State is not bound by the
``statewideness'' requirement of section 1902(a)(1) of the Act. (The
``statewideness'' requirement of section 1902(a)(1) of the Act
provides, in part, that the provisions of a State plan be in effect in
all political subdivisions of the State.) Thus, States may limit the
provision of case management services to any defined location of the
State (that is, city, county, community, etc.).
Section 1915(g)(1) of the Act also permits States to target case
management services to individuals with particular diseases or
conditions, without regard to the ``comparability'' provision in
section 1902(a)(10)(B) of the Act. (The ``comparability'' provision
generally requires States to make Medicaid services available in the
same amount, duration, and scope to all individuals within the
categorically needy group or covered medically needy group. The
comparability provision also requires that the Medicaid services
available to any individual in a categorically needy group are not less
in amount, duration, and scope than those Medicaid services available
to an individual in a medically needy group.) Thus, a State may limit
case management services to any specific identifiable group, such as
individuals with human immunodeficiency virus (HIV), acquired immune
deficiency syndrome (AIDS), AIDS-related conditions, or chronic mental
illness. A State's flexibility to target case management services to a
specific group sets these services apart from most other services
available under the Medicaid program.
In identifying the groups eligible to receive targeted case
management services, States are not required to distinguish eligible
individuals by traditional Medicaid concepts of eligibility groups
(that is, mandatory categorically needy, optional categorically needy,
medically needy), although this avenue continues to be available to
States, should they choose it. Instead, States may target case
management services by age, type or degree of disability, illness or
condition, or any other identifiable characteristic or combination of
characteristics. There is no limit on the number of groups to whom case
management services may be targeted.
We note that the exception to the comparability requirement applies
only to the provision of targeted case management services under
section 1915(g) of the Act. The comparability requirements of section
1902(a)(10)(B) of the Act continue to apply to all other Medicaid
services for which an individual may be eligible, unless these services
are subject to comparability exceptions in their own right. In other
words, receipt of case management services does not in any way alter an
individual's eligibility to receive other services under the State
plan.
In Sec. 431.54, we are revising paragraph (a) and adding a new
paragraph (g) that includes targeted case management services as an
exception to the comparability requirements in Sec. 440.250 and to the
statewide operation requirement in Sec. 431.50(b). This implements the
targeting provisions at section 1915(g)(1) of the Act.
C. Definition of Case Management Services--Sec. 440.169
Consistent with the provisions of section 1915(g)(2) of the Act, as
added by the DRA, we will define case management services in Sec.
440.169(a) generally as services that assist individuals eligible under
the plan in gaining access to needed medical, social, educational, and
other services. The intent of case management is to assist the
individual in gaining access to needed services, consistent with the
requirements of the law and these regulations. ``Other services'' to
which an individual eligible under the plan may gain access may include
services such as housing and transportation.
In Sec. 440.169(b), we define targeted case management services as
case management services furnished to particular defined target groups
or in any defined locations without regard to requirements related to
statewide provision of services or comparability.
The integrated medical direction and management of services
furnished to inpatients in a medical institution already includes case
management activities. Therefore, including separate coverage for
institutionalized individuals will in general, result in duplicative
coverage and payment. Individuals with complex and chronic medical
needs and individuals transitioning to a community setting after a
significant period of time in a hospital, nursing facility, or
intermediate care facility for individuals with mental retardation,
however,
[[Page 68081]]
require case management that is beyond the scope of work of
institutional discharge planners. These case management services
facilitate the process of transitioning individuals from institutional
care to community services. For example, individuals may require
assistance locating community services. Thus, services we define as
case management services for transitioning individuals from medical
institutions to the community will be included as a separately covered
case management service.
In Sec. 440.169(c), we define case management services for the
transitioning of individuals from institutions to the community.
Individuals (except individuals ages 22 to 64 who reside in an
institution for mental diseases (IMD) or individuals who are inmates of
public institutions) may be considered to be transitioning to the
community during the last 60 consecutive days (or a shorter period
specified by the State) of a covered, long-term, institutional stay
that is 180 consecutive days or longer in duration. For a covered,
short-term, institutional stay of less than 180 consecutive days,
individuals may be considered to be transitioning to the community
during the last 14 days before discharge. We use these time
requirements to distinguish case management services that are not
within the scope of discharge planning activities from case management
required for transitioning individuals with complex, chronic, medical
needs to the community. As specified in Sec. 441.18(a)(8)(vii)(D) and
(E), FFP would not be payable until the date that an individual leaves
the institution, is enrolled with the community case management
provider, and receiving medically necessary services in a community
setting.
In sum, we are defining the case management benefit to include only
services to individuals who are residing in a community setting or
transitioning to a community setting following an institutional stay.
Our proposed exclusion of FFP for case management services or
targeted case management services provided to individuals under age 65
who reside in an IMD or to individuals involuntarily living in the
secure custody of law enforcement, judicial, or penal systems is
consistent with the statutory requirements in paragraphs (A) and (B)
following paragraph section 1905(a)(28) of the Act. The statute
indicates that ``except as otherwise provided in paragraph (16), such
term [medical assistance] does not include (A) any such payments with
respect to care or services for any individual who is an inmate of a
public institution. An individual is considered to be living in secure
custody if serving time for a criminal offense in, or confined
involuntarily to, State or Federal prisons, local jails, detention
facilities, or other penal facilities. A facility is a public
institution when it is under the responsibility of a governmental unit
or over which a governmental unit exercises administrative control.
Case management services could be reimbursed on behalf of Medicaid-
eligible individuals paroled, on probation, on home release, in foster
care, in a group home, or other community placement, that are not part
of the public institution system, when the services are identified due
to a medical condition targeted under the State's Plan, and are not
used in the administration of other non-medical programs.
At paragraph (B), following paragraph section 1905(a)(28) of the
Act, the statute indicates that medical assistance does not include
``any such payments with respect to care or services for any individual
who has not attained 65 years of age and who is a patient in an
institution for mental diseases.'' Paragraph (16) includes in the
definition of ``medical assistance'' ``* * * inpatient psychiatric
hospital services for individuals under age 21 * * *''. Section 1905(h)
of the Act defines ``inpatient psychiatric hospital services'' to
include inpatient services in inpatient settings other than psychiatric
hospitals, as specified by the Secretary in regulations. The Secretary
has specified in regulations at Sec. 440.160 that such settings
include ``a psychiatric facility which is accredited by the Joint
Commission on Accreditation of Healthcare Organizations, the Council on
Accreditation of Services for Families and Children, the Commission on
Accreditation of Rehabilitation Facilities, or by any other accrediting
organization with comparable standards, that is recognized by the
State.'' Thus, the term ``inpatient hospital services for individuals
under age 21'' includes services furnished in accredited psychiatric
residential treatment facilities, currently known as ``PRTFs,''
providing inpatient psychiatric services for individuals under age 21
that are not hospitals.
However, the statutory wording of the exception to the IMD
exclusion makes it clear that medical assistance includes payment only
for inpatient hospital services furnished to residents under age 21 in
an inpatient psychiatric hospital or, by regulation, to residents under
age 21 in an accredited PRTF. FFP does not extend to other services
furnished to individuals under age 21 residing in these settings.
However, we are clarifying in this rule that FFP is available for
community case management services to transition an individual
receiving inpatient psychological services for individuals under age 21
(authorized under section 1905(a)(16) of the Act), after discharge from
a medical institution to the community. FFP would not be payable until
the date that an individual leaves the institution, is enrolled with
the community case management provider, and receiving medically
necessary services in a community setting.
At Sec. 440.169(d), we specify that case management includes the
following elements specified in section 1915(g)(2)(A)(ii) of the Act:
1. Assessment and periodic reassessment of an eligible individual
to determine service needs, including activities that focus on needs
identification, to determine the need for any medical, educational,
social, or other services. Such assessment activities include:
Taking client history.
Identifying the needs of the individual and completing
related documentation.
Gathering information from other sources such as family
members, medical providers, social workers, and educators, if
necessary, to form a complete assessment of the eligible individual.
Because the statute defines case management services as those
services that will assist individuals eligible under the plan in
gaining access to needed medical, social, educational, and other
services, we believe that an assessment of an individual's needs should
be comprehensive and address all needs of the individual. Thus, we are
requiring in Sec. 440.169(d)(1) that the assessment be comprehensive
in order to address all areas of need, the individual's strengths and
preferences, and consider the individual's physical and social
environment. Performance of a comprehensive assessment can minimize the
need for an individual to be covered under multiple case management
plans and have multiple case managers, and can reduce the likelihood of
service duplication and inefficiencies.
Assessment includes periodic reassessment to determine whether an
individual's needs and/or preferences have changed. At this time, we
will not put forth Federal standards for the frequency of reassessment,
but recommend that face-to-face reassessments be conducted at least
[[Page 68082]]
annually or more frequently if changes occur in an individual's
condition.
2. Development and periodic revision of a specific care plan based
on the information collected through an assessment or reassessment,
that specifies the goals and actions to address the medical, social,
educational, and other services needed by the eligible individual,
including activities such as ensuring the active participation of the
eligible individual and working with the individual (or the
individual's authorized health care decision maker) and others to
develop those goals and identify a course of action to respond to the
assessed needs of the eligible individual.
Because the assessment of an individual's needs must be
comprehensive, the care plan also must be comprehensive to address
these needs. However, while the assessment and care plan must be
comprehensive and address all of the individual's needs, an individual
may decline to receive services in the care plan to address these
needs. Section 1902(a)(23) of the Act requires that recipients have
free choice of qualified providers. This means that the individual
cannot be required to receive services from a particular provider--or
from any provider--if the individual chooses. If an individual declines
services listed in the care plan, this must be documented in the
individual's case records.
Referral and related activities (such as scheduling
appointments for the individual) to help an individual obtain needed
services, including activities that help link eligible individuals with
medical, social, educational providers, or other programs and services
that are capable of providing needed services to address identified
needs and achieve goals specified in the care plan.
Referral and related activities do not include providing
transportation to the service to which the individual is referred,
escorting the individual to the service, or providing child care so
that an individual may access the service. The case management referral
activity is completed once the referral and linkage has been made. It
does not include the direct services, program, or activity to which the
individual is linked.
Monitoring and follow-up activities, including activities
and contacts that are necessary to ensure that the care plan is
effectively implemented and adequately addresses the needs of the
eligible individual. Monitoring and follow-up activities may be with
the individual, family members, providers, or other entities or
individuals. These activities may be conducted as frequently as
necessary to help determine whether:
--The services are being furnished in accordance with the individual's
care plan.
--The services in the care plan are adequate to meet the needs of the
individual.
--There are changes in the needs or status of the individual. If there
are changes in the needs or status of the individual, monitoring and
follow-up activities include making necessary adjustments in the care
plan and service arrangements with providers.
Monitoring may involve either face-to-face or telephone contact. We
are requiring that monitoring occur at a frequency established by the
State, but no less frequently than annually.
In the course of providing case management services, case managers
can use a person-centered approach. A person-centered approach is a
process used to develop, implement, and manage a care plan that
attempts to fulfill the objectives and personal preferences of the
individual or the legal representative of that individual. The process
focuses on the person rather than the system; directly involves the
person (or the legal representative of that individual) in the plan
development, all aspects of implementation and management; and is
tailored to meet individualized needs. Varying levels of person-
centered planning, including choice not to participate, may be selected
by the individual (or by the individual's legal representative). The
individual or legal representative can participate throughout all
components of case management and direct who may participate in the
care plan development process along with the case manager and the
individual or the individual's legal representative.
Case management services must be provided by a single Medicaid case
management provider. This provision is consistent with the requirement
that the case management includes a comprehensive assessment and care
plan. Thus, when an individual could be served under more than one
targeted case management plan amendment because he falls within the
scope of more than one target group (for example when the individual
has both mental retardation and a mental illness and the State has
target groups for both conditions), a decision must be made concerning
the appropriate target group so that the individual will have one case
management provider. That provider will be responsible for ensuring
that the comprehensive assessment and care plan address the
individual's needs stemming from mental retardation and from the mental
illness. In doing so, the case management provider must coordinate with
service providers in both systems of care to ensure that the
individual's needs are met. We intend to provide for a delayed
compliance date so that States will have a transition period of the
lesser of 2 years or 1 year after the close of the first regular
session of the State Legislature that begins after this regulation
becomes final before we will take enforcement action on the requirement
for one case manager to provide comprehensive services to individuals.
We will be available to States as needed for technical assistance
during this transition period.
We note that section 1915(g)(2) of the Act specifically defines
case management services in terms of services furnished to individuals
who are eligible under the State plan. This provision reinforces basic
program requirements found in section 1905(a) of the Act that require
medical assistance to be furnished only to eligible individuals. An
``eligible individual'' is a person who is eligible for Medicaid and
eligible for case management services (including targeted case
management services) as defined in the Medicaid State plan, at the time
the services are furnished. Case management as medical assistance under
the State plan cannot be used to assist an individual, who has not yet
been determined eligible for Medicaid, to apply for or obtain this
eligibility. (Those activities may be an administrative expense of the
State's operation of its Medicaid program, rather than a medical
assistance service.)
While the provision of case management services to non-Medicaid
eligible individuals cannot be covered, we are including a regulatory
provision at Sec. 440.169(e) to make clear that the effective case
management of eligible individuals may require some contact with non-
eligible individuals. For instance, in completing the assessment for a
Medicaid eligible child for whom targeted case management is available,
it may be appropriate for a case manager to interview the child's
parents and/or other family members who are not eligible for Medicaid,
or who are not, themselves, part of a target population specified in
the State plan. Contacts with family members that are for the purpose
of helping the Medicaid-eligible individual access services can be
covered by Medicaid. It also may be appropriate to have non-eligible
family members involved in all components of case management because
they may be able to help identify needs and supports to assist the
eligible individual in
[[Page 68083]]
obtaining services, provide case managers with useful feedback, and
alert case managers to changes in the individual's needs.
A case manager's contacts with individuals who are not eligible for
Medicaid, or who are not included in the group who receives targeted
case management services, can be considered allowable activities,
eligible for FFP, when the purpose of the contact is directly related
to the management of the eligible individual's care. However, these
activities will not be considered allowable if they relate directly to
the identification and management of the non-eligible, or non-targeted
individual's needs and care. Contacts that relate to the case
management of non-eligible individuals, that is, assessment of their
needs, referring them to service providers, and monitoring their
progress, cannot be covered by Medicaid due to the fact they are not
Medicaid eligible or not covered under the case management target
population. If these other family members or other individuals also are
Medicaid eligible and covered under a target group included in the
State plan, Medicaid could pay for case management services furnished
to them. In addition, these individuals could receive other medically
necessary services for which they may qualify.
D. Comparability Exception To Permit Targeting--Sec. 440.250
We will revise Sec. 440.250 by adding a new paragraph (r) to
provide for an exception to the comparability requirements under Sec.
440.240 for targeted case management services.
E. Technical Change to Statement of Statutory Basis--Sec. 441.10
In part 441, subpart A, we will revise Sec. 441.10 to add a new
paragraph (m), which provides a statutory basis for the provision of
case management and targeted case management services.
F. Limitations on Case Management Services--Sec. 441.18
At Sec. 441.18(a)(1), we are specifying that, with the exception
discussed above at Sec. 431.51, individuals must have the free choice
of any qualified provider. Section 9508 of COBRA amended section
1915(g) of the Act to require that there be no restriction on a
recipient's free choice of providers, in violation of section
1902(a)(23) of the Act. Based on COBRA's legislative history, we
believe the Congress intended that individuals receiving case
management services under section 1915(g) of the Act not be locked into
designated providers, whether for case management services, or for
other services. (See H. Rept. No. 453, 99th Cong., 1st Sess. 546
(1985).) Therefore, except as described in Sec. 441.18(b), individuals
eligible to receive case management (or targeted case management)
services must be free to choose their case management provider from
among those that have qualified to participate in Medicaid and are
willing to provide the services.
States must establish qualifications for providers of case
management services in the State plan. These qualifications relate to
minimum age requirements, education, work experience, training, and
other requirements, such as licensure or certification, which the State
may establish. The Act does not set any minimum educational or
professional qualifications for the provision of case management
services. Therefore, States have flexibility to establish
qualifications that are reasonably related to the demands of the
Medicaid case management services to be furnished and the population
being served. For example, it is reasonable to expect that the
qualifications for case managers serving children who are ventilator-
dependent to be different than those qualifications for case managers
serving persons with intellectual disabilities. While the case manager
must possess the knowledge and skills to conduct a comprehensive
assessment and to assist the individual or the individual's legal
representative with the development of a comprehensive care plan, this
does not mean that the case manager must have experience with the
program requirements of every medical, social, educational, or other
program to which an individual may be referred; it means that the case
manager must be familiar with the general needs of the population being
served and must be able to connect and coordinate with medical, social,
educational, and other programs that serve the population. If the case
manager also provides other services under the plan, the State must
ensure that a conflict of interest does not exist that will result in
the case manager making self-referrals.
We are also including at Sec. 441.18(a)(2) and Sec. 441.18(a)(3)
provisions to ensure that the provision of case management is neither
coerced nor a method to restrict access to care or free choice of
qualified providers. The receipt of case management services must be at
the option of individuals included in a specific target group. This
requirement is also consistent with section 1902(a)(19) of the Act. A
recipient cannot be compelled to receive case management services for
which he or she might be eligible. Requiring an individual to receive
case management services against his or her will would not be in the
best interest of the individual and, thus, will violate sections
1902(a)(19) and 1902(a)(23) of the Act. A State also cannot condition
receipt of case management services on the receipt of other services
since this also serves as a restriction on the individual's access to
case management services.
Section 1915(g)(1) of the Act prohibits the use of case management
services in any fashion that will restrict an individual's access to
other care and services furnished under the State plan, which will
violate section 1902(a)(23) of the Act. The purpose of case management
services authorized by section 1915(g) of the Act is to help an
individual gain access to services, not hinder this access. Permitting
case managers to function as gatekeepers under this optional State plan
service will allow case managers to restrict access to services--that
is, to the extent to which authorization may be denied, access also may
be denied. Because this concept is contrary to the statutory definition
of case management services, providers of case management services
(including targeted case management services) furnished under this
section are prohibited from serving as gatekeepers under Medicaid.
(States may use a section 1915(b) waiver or primary care case
management (PCCM) services under section 1905(a)(25) for this purpose.)
Similarly, a State cannot require that an individual receive case
management services as a prerequisite for receiving other Medicaid
services.
In Sec. 441.18(a)(4), we require that the State's plan provide
that case management services will not duplicate payments made to
public agencies or private entities under the State plan and other
program authorities. In authorizing States to offer case management
services, the Congress recognized that there was some potential for
duplicate payments. This recognition led to an explicit statement in
the legislative history of COBRA that prohibited the duplication of
payments. (See H. Rept. No. 453, 99th Cong., 1st Sess. 546 (1985).) The
Congress clarified its prohibition on the duplication of funding in
section 8435 of the Technical and Miscellaneous Revenue Act of 1988.
This provision prohibits the Secretary from denying approval of a case
management State plan amendment on the basis that the State is required
to provide those services under State law, or on the basis that the
State had paid for those services from other non-Federal funds. In
other words, the duplication of payment prohibition does
[[Page 68084]]
not preclude States from using Medicaid to pay for case management
services that previously had been funded solely with State and/or local
dollars. The amendment also specifies, however, that the Secretary is
not required to make payment under Medicaid for case management
services that are furnished without charge to users of the services.
When an individual could be served under more than one targeted
case management plan amendment because he falls within the scope of
more than one target group, a decision must be made concerning the
appropriate target group so that the individual will have one case
manager responsible for his services and duplicate payment for the same
purpose will not be made.
While FFP would not be available for case management services that
duplicates payments made under other program authorities, section
1903(c) of the Act provides an exception for medical assistance for
covered Medicaid services, including case management services,
furnished to a child with a disability because such services are
included in an individualized education program or individualized
family service plan.
In section 441.18(a)(5), we would require case management services
to be provided on a one-to-one basis to eligible individuals by one
case manager. We are including this requirement to implement the
provisions of section 1915(g)(2)(A)(ii) that sets forth a unified care
planning process for case management to respond to the needs of
eligible individuals based on a comprehensive assessment. The statute
describes a step-by-step process, each component built upon the
previous one, to ensure that the care plan is effectively implemented
and adequately addresses all of the assessed needs of the eligible
individual. Having one case manager is necessary to ensure
accountability and coordination in assisting individuals in gaining
access to services to address all components of assessed need.
Fragmenting the service would reduce the quality of case management;
the point of case management is to address the complexities of
coordinated service delivery for individuals with medical needs. The
case manager should be the focus for coordinating and overseeing the
effectiveness of all providers and programs in responding to the
assessed need.
We are including Sec. 441.18(a)(6) to prohibit providers of case
management services from exercising the State Medicaid agency's
authority to authorize or deny the provision of other services under
the plan. Although a State Medicaid agency may place great weight on
the informed recommendation of a case manager, it must not rely solely
on case management recommendations in making decisions about the
medical necessity of other Medicaid services that the individual may
receive. The decision to authorize the provision of a service must
remain with the State Medicaid agency as required by Sec. 431.10(e).
Costs related to these activities, such as prior authorization or
determination of medical necessity, which are necessary for the proper
and efficient administration of the Medicaid State plan, must be
claimed as a direct administrative expense by the Medicaid agency and
may not be included in the development of a case management rate.
If a State plan provides for case management services (including
targeted case management services), the State must require providers to
maintain case records that document the information required by Sec.
441.18(a)(7). These case records must document, for each individual
receiving case management, the name of the individual; the dates of
case management services; the name of the provider agency (if relevant)
and person chosen by the individual to provide the case management
services; the nature, content, units of case management services
received and whether the goals specified in the care plan have been
achieved; whether the individual has declined services in the care
plan; timelines for providing services and reassessment; and the need
for, and occurrences of, coordination with case managers of other
programs.
States that opt to furnish case management services must do so by
amending their State plans in accordance with Sec. 441.18(a)(8) and
Sec. 441.18(a)(9). FFP is not available for case management as a
medical assistance service under sections 1905(a)(19) and 1915(g) of
the Act in the absence of an approved amendment to the State's Medicaid
plan. A State's amendment to its State plan must contain all
information necessary for CMS to determine whether the plan can be
approved to serve as a basis for FFP. Each amendment must--
Specify whether case management will be targeted, and if
so, define the targeted group (and/or subgroup);
Identify the geographic area to be served;
Describe the services to be furnished including types of
monitoring;
Specify the frequency of assessments and monitoring and
provide a justification for the frequencies (given that targeted groups
may vary in their need for case management services);
Specify the qualifications of the service providers;
Specify the methodology under which case management
providers will be paid and rates are calculated;
Specifies if case management services are being provided
to Medicaid-eligible individuals who are in institutions to facilitate
transitioning to the community. In this case, the amendment must
specify if case management services are being provided to individuals
with long-term stays of 180 consecutive days or longer or to
individuals with short-term stays of less than 180 consecutive days.
Furthermore, when States choose to provide case management services to
individuals in institutions to facilitate transitioning to the
community, the State plan must specify the time period or other
conditions under which case management may be provided in this manner.
The time period that case management is provided in an institution must
not exceed an individual's length of stay. In addition, the State plan
must specify the case management activities and include an assurance
that these activities are coordinated with and do not duplicate
institutional discharge planning; include an assurance that the amount,
duration, and scope of the case management activities would be
documented in an individual's plan of care which includes case
management activities prior to and post-discharge, to facilitate a
successful transition to community living; specify that case management
is only provided by and reimbursed to community case management
providers; specify that FFP is only available to community providers
and will not be claimed on behalf of an individual until the individual
is discharged from the institution and enrolled in community services;
and describe the system and process the State will use to monitor
providers' compliance with these provisions.
In addition, if the State plan provides for targeted case
management, the State must submit a State plan amendment for each
target group that will receive case management services. A separate
amendment also must be submitted for each subgroup within a group if
any of these elements differ for that subgroup.
While a State has some flexibility to establish the methodology and
rates it will use to reimburse providers of case management or targeted
case
[[Page 68085]]
management services, a State cannot employ a methodology or rate that
results in payment for a bundle of services. Per diem rates, weekly
rates, and monthly rates represent a bundled payment methodology that
is not consistent with section 1902(a)(30)(A) of the Act, which
requires that States have methods and procedures to assure that
payments are consistent with efficiency, economy, and quality of care.
A bundled payment methodology exists when a State pays a single rate
for more than one service furnished to an eligible individual during a
fixed period of time. The payment is the same regardless of the number
of services furnished or the specific costs, or otherwise available
rates. Since these bundled (daily, weekly, or monthly) rates are not
reflective of the actual types or numbers of services provided or the
actual costs of providing the services, they are not accurate or
reasonable payments and may result in higher payments than would be
made on a fee-for-service basis for each individual service. A bundled
rate is inconsistent with economy, since the rate is not designed to
accurately reflect true costs or reasonable fee-for-service rates, and
with efficiency, since it requires substantially more Federal oversight
resources to establish the accuracy and reasonableness of State
expenditures. We therefore expect that case management and targeted
case management services reimbursed on a fee-for-service basis, as
opposed to a capitated basis, will be reimbursed based on units of
time. Because of the nature of case management, which can include
contacts of brief duration, we believe that the most efficient and
economical unit of service is a unit of 15 minutes or less.
Accordingly, we are requiring in Sec. 441.18(a)(8)(vi) that the unit
of service for case management and targeted case management services be
15 minutes or less.
In Sec. 441.18(b) we require that, if a State limits qualified
providers of case management services for target groups with
developmental disability or chronic mental illness, in accordance with
Sec. 431.51(a)(4), the plan must identify the limitations being
imposed on the providers and specify how these limitations enable
providers to ensure that individuals within the target groups receive
needed services.
At Sec. 441.18(c)(1), we specify that the case management benefit
does not include, and FFP is not available for, activities that are an
integral component of another covered Medicaid service. To include
those activities as a separate benefit will result in duplicate
coverage and payment. This activity would not be consistent with proper
and efficient operation of the program. For example, when an individual
receives services from a physician and the physician refers the
individual to a home health agency for services, that referral is
integral to the physician's service and FFP will not be available for
that activity as a case management service.
Individuals participating in a managed care plan receive case
management services as an integral part of the managed care services.
This case management is for the purpose of managing the medical
services provided by or through the plan and does not extend to helping
an individual gain access to social, educational, and other services
the individual may need. Thus, an individual receiving services through
a managed care plan may also receive case management or targeted case
management services when the individual is eligible for those services.
For example, an individual with AIDS served by a managed care plan may
also be served under a case management plan targeted to persons with
AIDS/HIV. However, FFP is not available for case management of medical
services that are also managed by the individual's managed care plan.
In this situation, it is expected that the Medicaid case manager would
coordinate with the managed care plan as appropriate. At Sec.
441.18(c)(2) through Sec. 441.18(c)(5), we set forth limitations
authorized by the DRA on the case management benefit. The regulation
text at Sec. 441.18(c) includes the statutory principle set forth at
section 1915(g)(2)(A)(iii) of the Act providing that the case
management benefit does not include services that involve the direct
delivery of underlying medical, educational, social, or other services
to which an eligible individual has been referred.
The statutory definition of case management established by the DRA
draws a distinction between services that assist an individual in
accessing needed services and the actual services to which access is
gained. Case management services include only those activities that
help an individual gain access to needed medical, social, educational,
and other services. Case managers can assist individuals in gaining
access to needed services, regardless of the funding source of the
service to which the individual is referred. By including more than
medical care, States can implement a holistic approach to the delivery
of services by using case management to identify all of an individual's
care needs and coordinate access to services that address these needs.
Case management does not include the actual direct services the
individual obtains. For this reason, if a case manager provides a
direct service, such as counseling, during the course of a case
management visit, the direct service cannot be reimbursed as part of
the case management service. This service may be covered under another
Medicaid service category, such as rehabilitation services, if the
service is covered under the State's Medicaid program, the case
management provider also is a qualified provider of that service, and
the individual chooses to receive the service from the case manager.
The performance of diagnostic tests also is a direct service. While
diagnostic tests may provide information that inform the assessment and
care development process, they do not constitute an assessment activity
under section 1915(g)(2) of the Act that is covered under the case
management benefit. These services, however, may be covered under
another medical assistance category if provided in the State plan.
Similarly, referral and related activities do not include the provision
of transportation or escort services, nor do they include the provision
of day care services so that an eligible individual with children can
access needed services. These are direct services rather than coverable
case management activities.
The nature of the case management benefit to ``assist eligible
individuals to gain access to needed services'' and the similarity of
its 1985 definition to the purpose of other programs also has led many
to confuse the Medicaid benefit with the actual administration of non-
Medicaid programs. This is particularly true when a large number or
percentage of the participants in these non-Medicaid programs also are
eligible for Medicaid (and thus, potentially included in a target group
eligible to receive targeted case management services). Concerns in
this area have been raised through audits, the review of State plan
amendments and by the Government Accountability Office (Report GAO-05-
748, entitled ``States Use of Contingency Fee Consultants to Maximize
Federal Reimbursements Highlights Need for Improved Federal
Oversight,'' June 2005). The following are examples of targeted case
management State plans that were inconsistent with Federal policy,
resulting in excessive Federal Medicaid outlays. These examples
illustrate the need for the specific definitions and guidance contained
in this rule.
In one State, in fiscal year 2003, the State received an
estimated $17 million in Federal reimbursement for targeted case
management claims from juvenile justice and child welfare agencies of
[[Page 68086]]
which about $12 million was for services that were integral to non-
Medicaid programs.
A State agency claimed $86.6 million Federal share in
fiscal years 2002 and 2003 for unallowable targeted case management
services furnished by a social services agency. Contrary to Federal
requirements, the rates charged to Medicaid included social workers'
salary costs for child protection and welfare services.
In a CMS audit of a State's counties that provided
targeted case management services, 72 percent of encounters in one
county were incorrectly claimed during a 1-year period. These
encounters either did not meet the definition of targeted case
management at section 1915(g)(2) of the Act or were claimed for clients
that were ineligible for Medicaid.
These past abuses and other occurrences of cost shifting from State
foster care programs led to the reforms in case management and targeted
case management made by section 6052 of the DRA. In the DRA, the
Congress specifically precluded the use of the Medicaid case management
benefit for the direct delivery of an underlying medical, social,
educational, or other service funded by other programs. In addition,
the Congress provided examples with respect to foster care of services
that are excluded from case management services. The inclusion of
examples for foster care does not limit the general prohibition on
including the direct services of other programs from case management
services under Medicaid as well. For example, the exclusion extends
to--
Child Welfare/Child Protective Services. States provide
child protective services to children at risk of abuse or neglect.
These services include investigation of allegations of abuse or
neglect, identification of risk factors, provision of services to
children and families in their own homes, monitoring of at-risk
children, placement of children into foster care or adoptive homes, and
evaluation of interventions. Child protective services includes
development and oversight of a service plan for the child and family
with the goal of moving the child toward permanency either through
family reunification, adoption, or other permanent living arrangement.
Because these services have their own goals'protecting vulnerable
children and moving them toward a safe and stable living situation--we
believe child protective services are the direct services of State
child welfare programs and are not Medicaid case management. These
activities of child welfare/child protective services are separate and
apart from the Medicaid program. Thus, Medicaid case management
services must not be used to fund the services of State child welfare/
child protective services workers. Further, Medicaid may not pay for
case management services furnished by contractors to the State child
welfare/child protective services agency, even if they would otherwise
be qualified Medicaid providers, because they are furnishing direct
services of the programs of that agency. However, children receiving
child welfare/child protective services may still qualify to receive
Medicaid targeted case management services, when these services are
provided according to the Medicaid State plan program by a qualified
Medicaid provider who is not furnishing direct services of other
programs. For example, a Medicaid eligible child with a mental disorder
receiving child protective services may also qualify to receive case
management services targeted to children with mental disorders.
Parole and Probation. States often use parole and
probation as methods by which offenders can be eased back into the
mainstream society. The supervision, counseling, and oversight required
by these programs assist individuals in learning--or re-learning--how
to live within the legal bounds that society places on the behavior of
its members. Both parole and probation are, however, functions of the
administration of the justice system, and exist independent of the
Medicaid program. These functions have their own goals (for example,
conformance to law, adherence to conditions imposed by a court) which
may coincide with goals of the Medicaid program, but exist separate and
independent from it. Because probation and parole functions are
necessary and integral components of the administration of another
system, we believe that parole and probation functions are the direct
services of corrections programs and are not Medicaid case management.
Thus, we are prohibiting the use of parole or probation officers (or
other employees or contractors of the justice system or court) as case
management providers under Medicaid. Individuals who are on parole or
probation may still qualify to receive Medicaid case management or
targeted case management services for which they otherwise qualify (for
example, a Medicaid-eligible individual with a traumatic brain injury
could qualify to receive case management targeted to a group of persons
with brain injuries). However, claims for Medicaid case management must
not include the administration of the State's parole or probation
system.
Public Guardianship. Persons who have been determined to
need guardians, because they are found incapable of handling their own
affairs, may qualify for Medicaid case management when they are also
part of a group to whom this service is provided (for example, persons
with developmental disabilities). The public guardianship function,
however, is also a State or locally administered activity that is
independent of the Medicaid program. There is a fundamental difference
between guardians (or conservators, or other similarly appointed
individuals) and case managers. Case managers may assist decision-
makers in reaching conclusions about the needs of an individual and the
services that may best meet those needs, but they do not make these
decisions on behalf of that individual. That is the function of a
guardian (or conservator, or other similarly appointed individual).
Case managers may, therefore, assist guardians and others, in enabling
an individual to gain access to needed services, but they may not be
used to replace or fund the function of this fundamentally non-Medicaid
activity.
Special Education. The Individuals with Disabilities
Education Act (IDEA) ensures every child with a disability has
available a free appropriate public education (FAPE) that includes
special education and related services. Part B of the IDEA requires the
development and implementation of an individualized education program
(IEP) that addresses the unique needs of each child aged 3 through 21
with a disability. Part C of the IDEA requires the development and
implementation of an individualized family service plan (IFSP) to
address the unique developmental needs of an infant or toddler under 3
years of age with a disability. The IEP identifies the special
education and related services needed for the child with a disability.
An IFSP identifies the early intervention services and other services
needed for an infant or toddler with a disability and his or her
family.
While some of the services identified on a child's IEP (e.g., a
related service such as physical therapy) may be covered under
Medicaid, the development, review, and implementation of the IEP is
part of a process that is required by Part B of the IDEA. This process
should not be confused with Medicaid case management (or targeted case
management) services, which also may be needed by the child. Similarly,
under Part C, the IFSP may identify a need for
[[Page 68087]]
case management as well as other services and activities some of which
may be covered under Medicaid and others that, while a necessary
component of the Part C program, are not covered under Medicaid. One
distinction between the IEP and IFSP is that the IFSP process for an
infant or toddler with a disability under the age of three requires a
service coordinator from the outset, some of whose activities may be
Medicaid-funded case management (or targeted case management) services.
Case management activities in this context could include taking the
infant or toddler's history, identifying service needs, and gathering
information from other sources to form a comprehensive assessment. Case
management would not include administrative functions that are purely
IDEA functions such as scheduling IFSP team meetings, and providing the
requisite prior written notice.
An IEP or IFSP may identify the need for case management to
coordinate access to a broad range of medical service providers from
several disciplines, and also may identify needs for case management to
gain access to non-medical services. As with other Medicaid covered
services (such as physical, occupational, or speech therapy) identified
on the IEP or IFSP, such case management services may be covered under
Medicaid when furnished to a Medicaid-eligible child by a Medicaid
qualified provider who assists in gaining access to and coordinating
all needed services. To facilitate coordinated care, case management is
a covered Medicaid service only when a single case manager
comprehensively addresses all of the individual's service needs.
While Medicaid funding could be available for the costs of
a Medicaid-qualified case manager who may be operating in a school or
early intervention program in assisting IDEA-eligible children in
gaining access to needed services, including those identified in their
IEP or IFSP, coordinating the provision of those services, and
facilitating the timely delivery of services, Medicaid case management
services must remain separate and apart from the administration of the
IDEA programs. Medicaid may pay for those case management services
where IDEA and Medicaid overlap, but not for administrative activities
that are required by IDEA but not needed to assist individuals in
gaining access to needed services. These would include activities such
as writing an IEP or IFSP, providing required notices to parents,
preparing for or conducting IEP or IFSP meetings, or scheduling or
attending IEP or IFSP meetings. Section 504 of the Rehabilitation Act
(RA) of 1973 requires school districts to provide to students with
disabilities, appropriate educational services designed to meet the
individual needs of such students to the same extent as the needs of
students without disabilities are met; that is, to provide an equal
opportunity for students with disabilities to participate in or benefit
from educational aids, benefits, or services. We are clarifying in this
regulation that FFP is not available for any case management activities
not included in an IEP or IFSP but performed solely based on
obligations under section 504 of the RA to ensure equal access to the
educational program or activity.
In accordance with section 1903(c) of the Act, nothing in this rule
would prohibit or restrict payment for medical assistance for covered
Medicaid services furnished to a child with a disability because such
services are included in the child's Individualized Education Program
(IEP) or Individual Family Service Plan (IFSP). Likewise, payment for
those services that are included in the IEP or IFSP would not be
available when those services are not covered Medicaid services. In
addition, Medicaid funds must not be used to replace or otherwise
supplant funds used for activities related to the administration of the
IDEA for infants and young children such as Child Find.
Therefore, at Sec. 441.18(c)(2), we state the general prohibition
established by the DRA in section 1915(g)(2)(A)(iii) of the Act on
including as Medicaid case management the direct delivery of services,
as well as include a list of programs to which we are applying this
prohibition in this regulation (parole and probation, public
guardianship, special education, child welfare/child protective
services, and foster care). We also include in Sec. 441.18(c)(3) the
specific statutory examples with respect to foster care--
Research gathering and completion of documentation
required by the foster care program;
Assessing adoption placements;
Recruiting or interviewing potential foster care parents;
Serving legal papers;
Home investigations;
Providing transportation;
Administering foster care subsidies; or
Making placement arrangements.
These examples of direct delivery of foster care activities are all
administrative activities that are integral to the delivery of services
through the foster care program. For the reasons discussed above, since
the statute cites these administrative activities as examples, rather
than as an all-inclusive list, at Sec. 441.18(c)(3), we are
interpreting the exclusion of administrative activities to extend to
all administrative activities integral to the administration of the
foster care program. Other foster care activities subject to this
payment exclusion include case management; referral to services;
overseeing foster care placements; the training, supervision, and
compensation of foster care parents; and attendance at court
appearances related to foster care. Since the activities of foster care
programs are separate and apart from the Medicaid program, Medicaid
case management services must not be used to fund the services of
foster care workers. The following is an example of how this payment
exclusion will be applied: When a title IV-E eligible child in foster
care is referred by a caseworker to the Medicaid program for medical
services or mental health services covered by the Medicaid program,
that administrative activity neither can be allocated and claimed to
the Medicaid program as an administrative expense of the Medicaid
program nor can those costs be claimed as a case management medical
assistance service. The State may, instead, claim these costs under the
title IV-E program to the extent allowable (see 45 CFR 1356.60(c)(2)
and ACF Child Welfare Policy Manual Section 8.1B). FFP for the medical
services to which a Medicaid-eligible child who resides in foster care
was referred would be available under the Medicaid program.
Furthermore, case management activities included under therapeutic
foster care programs will be subject to this payment exclusion since
these activities are inherent to the foster care program. FFP for
medical services to a Medicaid eligible child with medical care needs
who resides in therapeutic foster care would still be available,
provided all Medicaid requirements were met.
At Sec. 441.18(c)(4), we also apply this exclusion from the
definition of case management the administrative activities integral to
other non-medical programs, based on the general exclusion from case
management of services delivered under other programs in section
1915(g)(2)(A)(iii) of the Act.
At Sec. 441.18(c)(4), we, thus, will exclude from the case
management benefit the administrative activities of any other non-
medical program, specifically including activities that constitute the
administration of special education programs under IDEA, the
[[Page 68088]]
parole and probation functions conducted by or under the authority of
State or local courts or other justice entities, legal services
provided by any entity, child welfare/child protective services and
activities concerning guardianship of a person or the person's assets
performed by or under the auspices of offices of public guardianship,
or activities by any individual who has been appointed to perform
guardianship, conservatorship (or other similar duties) on behalf of a
Medicaid recipient by a court.
It is important to note that the exclusion of Medicaid funding for
case management activities that are used in the administration of other
non-medical programs does not, in any way, compromise Medicaid
recipients' eligibility for medically necessary services under the
plan, including medically necessary case management (and targeted case
management) services that are not used to administer other programs.
Thus, a Medicaid eligible child with a developmental disability, who
receives foster care services, will qualify for Medicaid case
management services targeted towards individuals with intellectual or
other developmental disabilities that are not furnished through the
foster care program. Similarly, a Medicaid-eligible child with chronic
asthma receiving foster care services will receive medically necessary
treatment services for that condition funded by Medicaid. Both of these
children, who also receive foster care services, will continue to
qualify for Medicaid-funded services. Thus, FFP will be available under
the Medicaid program for medically necessary services. Similarly, an
adult who tests positive for the human immunodeficiency virus (HIV) and
is also on parole may continue to be eligible for medically necessary
case management services targeted to individuals with HIV that are not
furnished through a non-medical State program or for medically
necessary treatment services.
In Sec. 441.18(c)(5)), we clarify that activities that meet the
definition in Sec. 440.169 for case management services and under the
approved State plan cannot be claimed as administrative activities,
under Sec. 433.15(b).
Certain activities may be properly claimed as administrative costs
when the activities are directly related to the proper and efficient
administration of the Medicaid State plan. Sometimes these activities
are commonly referred to, by States and others, as ``administrative
case management''; although, statute and regulation do not include such
terminology. These administrative activities are performed by State
agency staff and may involve facilitating access to and coordinating
Medicaid program services. Some examples of these administrative
activities include Medicaid eligibility determinations and re-
determinations; Medicaid intake processing; Medicaid preadmission
screening for inpatient care; prior authorization for Medicaid
services; utilization review; and Medicaid outreach. These examples are
not meant to be all-inclusive and CMS may make determinations regarding
whether these or other activities are necessary for the proper and
efficient administration of the State plan.
A State may not claim costs for administrative activities for the
proper and efficient administration of the State plan if the activities
are an integral part or extension of a direct medical service. In
addition, unlike case management claimed as a service cost which can
extend to coordinating with programs outside of Medicaid,
administrative activities are strictly related to enhancing access to
Medicaid services.
States may not claim, as administrative activities, the costs
related to general public health initiatives, overhead costs, or
operating costs of an agency whose purpose is other than the
administration of the Medicaid program. Activities directed toward
services not included under the Medicaid program, although these
services may be valuable to Medicaid beneficiaries, are not necessary
for the administration of the Medicaid program, and therefore are not
allowable administrative costs. In addition, with regard to any
allowable administrative claims, payment may only be made for the
percentage of time spent which is actually attributable to Medicaid
eligible individuals.
The allocation methodology for costs claimed for the proper and
efficient administration of the State plan must be specified in the
State's approved public assistance cost allocation plan in accordance
with subpart E of 45 CFR part 95 and ASMB C-10.
When the costs of any part of case management or targeted case
management are reimbursable under another federally funded program, a
State is directed by section 1915(g)(4)(B) of the Act to allocate costs
which are reimbursable under the other Federal program in accordance
with OMB Circular No. A-87 (or any related or successor guidance or
regulations regarding allocation of costs among federally funded
programs) under an approved cost allocation program. (OMB Circular No.
A-87, which details the cost principles for State, local, and Indian
Tribal Governments for the administration of Federal awards, pertains
to all Federal agencies whose programs, including Medicaid, are
administered by a State public assistance agency.) This requirement is
set forth in Sec. 441.18(d). OMB Circular A-87, Attachment A,
paragraph C.3.a requires allocation of costs among benefiting cost
objectives (programs).
IV. Response to Comments
Because of the large number of public comments we normally receive
on Federal Register documents, we are not able to acknowledge or
respond to them individually. We will consider all comments we receive
by the date and time specified in the DATES section of this preamble,
and, when we proceed with a subsequent document, we will respond to the
comments in the preamble to that document.
V. Waiver of Proposed Rulemaking
Ordinarily, we will publish a notice of proposed rulemaking and
afford a period for public comments in accordance with the provisions
of the Administrative Procedure Act, 5 U.S.C. 553. Further, we
generally provide for final rules to be effective no sooner than 30
days after the date of publication unless we find good cause to waive
the delay. Section 6052(b) of the DRA authorizes the Secretary to
promulgate regulations to carry out the new statutory provisions at
section 1915(g)(2) of the Act ``which may be effective and final
immediately on an interim basis as of the date of the interim final
regulation.'' In light of the importance of clarifying the definition
of case management and ensuring the fiscal integrity of the Medicaid
program, we have elected to use this authority to issue this rule as an
interim final rule with comment period. Section 6052(b) of the DRA
further provides that there must be a period for receipt of public
comments after the date of publication of an interim final rule, and
that the Secretary may revise the regulation after completion of the
period of public comment. We are complying with this requirement to
provide for a period of public comment.
This rule has been determined to be a major rule as defined in the
Congressional Review Act, 5 U.S.C. Sec. 804(2). These regulations are
effective March 3, 2008.
VI. Collection of Information Requirements
Under the Paperwork Reduction Act (PRA) of 1995, we are required to
provide 30-day notice in the Federal Register and solicit public
comment
[[Page 68089]]
before a collection of information requirement is submitted to the
Office of Management and Budget (OMB) for review and approval. In order
to fairly evaluate whether an information collection should be approved
by OMB, section 3506(c)(2)(A) of the PRA of 1995 requires that we
solicit comment on the following issues:
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
We are soliciting public comment on each of these issues for the
following sections of this document that contain information collection
requirements (ICRs):
Section 440.169 Case Management Services
Section 440.169(d) states that case managers assist eligible
individuals by providing services such as taking client history;
identifying the needs of the individual, and completing related
documentation; and gathering information from other sources such as
family members, medical providers, social workers, and educators (if
necessary) to form a complete assessment of the eligible individual.
The case manager must then develop a specific care plan based on the
information collected through the assessment.
The burden associated with this requirement is the time and effort
put forth by the case manager to gather the information and develop a
specific care plan. While this requirement is subject to the PRA, we
believe this requirement meets the requirements of 5 CFR 1320.3(b)(2),
and as such, the burden associated with this requirement is exempt from
the PRA.
Section 441.18 Case Management Services
Section 441.18(a) requires that if a State plan provides for case
management services, as defined in Sec. 440.169, the State must
require providers to maintain case records that document for all
individuals receiving case management the name of the individual; the
date of the case management service; the name of the provider agency
and the person providing the case management service; and the nature,
content, and units of case management service. Details of what the case
records must include are located at Sec. 441.18(a)(7).
The burden associated with this requirement is the time and effort
required for a provider to maintain case records. While this
requirement is subject to the PRA, we believe this requirement meets
the requirements of 5 CFR 1320.3(b)(2), and as such, the burden
associated with this requirement is exempt from the PRA.
If you comment on these information collection and record keeping
requirements, please mail copies directly to the following:
Centers for Medicare & Medicaid Services, Office of Strategic
Operations and Regulatory Affairs, Division of Regulations Development,
Attn.: Melissa Musotto, CMS-2237-IFC, Room C5-14-03, 7500 Security
Boulevard, Baltimore, MD 21244-1850.
Office of Information and Regulatory Affairs, Office of Management and
Budget, Attn.: Katherine Astrich, CMS Desk Officer, CMS-2237-IFC,
katherine_astrich@omb.eop.gov. Fax (202) 395-6974.
VII. Regulatory Impact Analysis
[If you choose to comment on issues in this section, please
indicate the caption ``Regulatory Impact'' at the beginning of your
comments.]
We have examined the impacts of this rule as required by Executive
Order 12866 (September 1993, Regulatory Planning and Review), the
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354),
section 1102(b) of the Social Security Act, the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132.
Executive Order 12866 (as amended by Executive Order 13258, which
merely reassigns responsibility of duties) directs agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). A
regulatory impact analysis (RIA) must be prepared for major rules with
economically significant effects ($100 million or more in any 1 year).
Section 804(2) of title 5, United States Code (as added by section
251 of Pub. L. 104-121), specifies that a ``major rule'' is any rule
that the Office of Management and Budget finds is likely to result in--
An annual effect on the economy of $100 million or more;
A major increase in costs or prices for consumers,
individual industries, Federal, State, or local government agencies, or
geographic regions; or
Significant adverse effects on competition, employment,
investment productivity, innovation, or on the ability of United States
based enterprises to compete with foreign based enterprises in domestic
and export markets.
The RFA requires agencies to analyze options for regulatory relief
of small businesses. For purposes of the RFA, small entities include
small businesses, nonprofit organizations, and small governmental
jurisdictions. Most hospitals and most other providers and suppliers
are small entities, either by nonprofit status or by having revenues of
$6 million to $29 million in any 1 year. This rule affects only States
directly. For purposes of the RFA, we do not consider States or
individuals to be small entities. Therefore, the Secretary certifies
that this rule will not have a significant economic impact on a
substantial number of small entities.
Section 1915(g) of the Act provides for Medicaid coverage of a new
optional State plan service, case management services, and permits
those services to be targeted. This regulation incorporates that
statutory provision in the Federal regulations.
Under section 1915(g) of the Act, States may, without securing a
waiver, furnish case management services, or targeted case management
services to specified Medicaid groups on a statewide basis or in a
particular geographic area of the State by requesting approval of a
State plan amendment. If a State elects to furnish case management
services (or targeted case management services), FFP will be available
to the State to assist individuals receiving Medicaid in gaining access
to needed medical, social, educational, and other services. Thus, the
Medicaid case management service adds value to services that would
otherwise be received through Medicaid and other programs in the
absence of Medicaid case management services. For example, case
management services provided to women with a high risk pregnancy can
prevent low birth weight infants and case management of chronic
problems can reduce hospital emergency room visits. Individuals retain
the right to select among qualified medical providers of case
management (or targeted case management) services.
Ambiguity concerning what services are reimbursable as case
management and targeted case management services has resulted in
questionable cost shifting of services onto Medicaid, which increases
costs. Although the Medicaid program will continue to pay
[[Page 68090]]
for case management and targeted case management services, this
regulation clarifies and conforms to current statutory requirements of
the regulatory definition. In fiscal year 2006, Federal and State
expenditures for targeted case management services were $2,842 million.
Table 1 contains the Federal and State expenditures for targeted case
management. These amounts do not reflect changes that may have occurred
in other services during the projection period as a result of the
provision of case management services.
Table 1.--Medicaid Targeted Case Management Spending
----------------------------------------------------------------------------------------------------------------
2001 2002 2003 2004 2005 2006
----------------------------------------------------------------------------------------------------------------
Federal........................... 1,176 1,384 1,641 1,628 1,620 1,643
State............................. 837 1,020 1,118 1,092 1,185 1,199
-----------------------------------------------------------------------------
Total......................... 2,012 2,405 2,759 2,720 2,805 2,842
----------------------------------------------------------------------------------------------------------------
Source: CMS-64 Data
Data is reported by Federal fiscal year
All amounts in millions of dollars
Section 6052 of DRA 2005 specifies that FFP is only available for
case management services or targeted case management services if there
are no other third parties liable to pay for those services, including
as reimbursement under a medical, social, educational, or other
program. Due to this regulation, it is estimated that Federal Medicaid
spending on case management and targeted case management services will
be reduced by $1,280 million between FY 2008 and FY 2012. This
reduction in spending is expected to occur as case management services
spending that could be paid for by other third parties or other Federal
programs, but received by the States as FFP, will no longer be
reimbursable.
Due to this regulation, the Assistant Secretary for Resources and
Technology estimates that Federal spending on title IV-E foster care
services will increase by $369 million between FY 2008 and FY 2012.
This increase is expected to occur because State foster care program
expenditures on case management will no longer be reimbursed as
Medicaid expenditures and would instead need to be paid by other
Federal programs or payment sources.
We are unable to estimate additional net costs/savings that might
result from case management under section 1915(g) of the Act for the
following reasons. The use of case management services may result in
increased access to other services, including those covered under
Medicaid. Conversely, provision of case management services may work to
lower both Federal and State costs by encouraging the use of cost-
effective medical care through transitioning individuals out of
institutions, referrals to qualified providers, and by discouraging
inappropriate utilization of costly services such as emergency room
care for routine procedures. The use of case management services also
may eliminate unnecessary care and over-utilization of services.
Further, by facilitating early treatment, the use of case management
services can preclude the need for more costly ``last resort''
treatment alternatives.
Because it is estimated that Federal Medicaid spending on case
management and targeted case management services will be reduced by
$1,280 million between FY 2008 and FY 2012 (and thus the annual effect
on the economy is $100 million or more), we have determined that this
interim final rule with comment period is a major rule under Executive
Order 12866. The Secretary certifies that this rule will not have a
significant economic impact on a substantial number of small entities.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a Core-Based
Statistical Area and has fewer than 100 beds. We have determined that
this interim final rule with comment period will not have a significant
effect on the operations of a substantial number of small rural
hospitals because there will be no change in the administration of the
provisions related to small rural hospitals. Therefore, the Secretary
certifies that this rule will not have a significant impact on small
rural hospitals and, accordingly, we are not preparing an analysis for
section 1102(b) of the Act.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. That threshold
level is currently approximately $120 million. This interim final rule
with comment period has no consequential effect on State, local, or
tribal governments or on the private sector.
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct requirement costs on State
and local governments, preempts State law, or otherwise has Federalism
implications. Since this regulation does not impose any costs on State
or local governments, the requirements of E.O. 13132 are not
applicable.
Accounting Statement
As required by OMB Circular A-4 (available at http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf
), in table 2, we have
prepared an accounting statement showing the classification of the
savings associated with the provisions of this interim final rule with
comment period. Tables 2 and 3 provide our best estimate of the savings
to the Federal Government as a result of the changes presented in this
interim final rule with comment period based on the estimate in the
President's FY 2008 Budget that Federal Medicaid spending on case
management and targeted case management services will be reduced by
approximately $210 million in FY 2008 and will be reduced by $1,280
million between FY 2008 and FY 2012. All savings are classified as
transfers from the State Government to Federal Government.
[[Page 68091]]
Table 2.--Accounting Statement: Classification of Estimated Savings, From FY 2008 to FY 2012 (in Millions)
----------------------------------------------------------------------------------------------------------------
Units
Primary discount Period
Category estimates Year dollar rate covered
(percent)
----------------------------------------------------------------------------------------------------------------
Federal Annualized Monetized (millions/year)................ $252.6 2008 7 2008-2012
254.5 ........... ........... ...........
........... 2008 ........... 2008-2012
256.0 ........... ........... ...........
........... 2008 0 2008-2012
---------------------------------------------------
From Whom to Whom? State Government to Federal Government
----------------------------------------------------------------------------------------------------------------
Table 3.--Annual Discounted Transfers--Case Management Rule (in Millions)
----------------------------------------------------------------------------------------------------------------
Discount rate (percent) 2008 2009 2010 2011 2012 Total
----------------------------------------------------------------------------------------------------------------
0............................................. 210 230 250 280 310 1,280
3............................................. 204 217 229 249 267 1,166
7............................................. 196 201 204 214 221 1,036
----------------------------------------------------------------------------------------------------------------
In accordance with the provisions of Executive Order 12866, this
regulation was reviewed by the Office of Management and Budget.
List of Subjects
42 CFR Part 431
Grant programs-health, Health facilities, Medicaid, Privacy,
Reporting and recordkeeping requirements.
42 CFR Part 440
Grant programs-health, Medicaid.
42 CFR Part 441
Family planning, Grant programs-health, Infants and children,
Medicaid, Penalties, Prescription drugs, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR chapter IV, subchapter C as set forth
below:
PART 431--STATE ORGANIZATION AND GENERAL ADMINISTRATION
0
1. The authority citation for part 431 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
2. Section 431.51 is amended by--
0
A. Republishing the introductory text to paragraph (c).
0
B. Removing the colon and the word ``or'' at the end of paragraph
(c)(2) and adding a semicolon and the word ``or'' in its place.
0
C. Removing the period at the end of paragraph (c)(3) and adding in its
place a semicolon and the word ``or''.
0
D. Adding a new paragraph (c)(4).
The revisions read as follows:
Sec. 431.51 Free choice of providers.
* * * * *
(c) Exceptions. Paragraph (b) of this section does not prohibit the
agency from--
* * * * *
(4) Limiting the providers who are available to furnish targeted
case management services defined in Sec. 440.169 of this chapter to
target groups that consist solely of individuals with developmental
disabilities or with chronic mental illness. This limitation may only
be permitted so that the providers of case management services for
eligible individuals with developmental disabilities or with chronic
mental illness are capable of ensuring that those individuals receive
needed services.
* * * * *
0
3. Section 431.54 is amended by--
0
A. Revising paragraph (a).
0
B. Adding a new paragraph (g).
The revision and addition read as follows:
Sec. 431.54 Exceptions to certain State plan requirements.
(a) Statutory basis--(1) Section 1915(a) of the Act provides that a
State shall not be deemed to be out of compliance with the requirements
of sections 1902(a)(1), (10), or (23) of the Act solely because it has
elected any of the exceptions set forth in paragraphs (b) and (d)
through (f) of this section.
(2) Section 1915(g) of the Act provides that a State may provide,
as medical assistance, targeted case management services under the plan
without regard to the requirements of sections 1902(a)(1) and
1902(a)(10)(B) of the Act.
* * * * *
(g) Targeted case management services. The requirements of Sec.
431.50(b) relating to the statewide operation of a State plan and Sec.
440.240 of this chapter related to comparability of services do not
apply with respect to targeted case management services defined in
Sec. 440.169 of this chapter.
PART 440--SERVICES: GENERAL PROVISIONS
0
6. The authority citation for part 440 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
7. A new Sec. 440.169 is added to subpart A to read as follows:
Sec. 440.169 Case management services.
(a) Case management services means services furnished to assist
individuals, eligible under the State plan who reside in a community
setting or are transitioning to a community setting, in gaining access
to needed medical, social, educational, and other services, in
accordance with Sec. 441.18 of this chapter.
(b) Targeted case management services means case management
services furnished without regard to the requirements of Sec.
431.50(b) of this chapter (related to statewide provision of services)
and Sec. 440.240 (related to comparability). Targeted case management
services may be offered to individuals in any defined location of the
State or to individuals within targeted groups specified in the State
plan.
(c) For purposes of case management services, individuals (except
individuals between ages 22 and 64 in an IMD or
[[Page 68092]]
individuals who are inmates of public institutions) may be considered
to be transitioning to a community setting during the last 60
consecutive days (or a shorter time period as specified by the State)
of a covered long-term, institutional stay that is 180 consecutive days
or longer in duration. For a covered, short-term, institutional stay of
less than 180 consecutive days, individuals may be considered to be
transitioning to a community setting during the last 14 days prior to
discharge.
(d) The assistance that case managers provide in assisting eligible
individuals obtain services includes--
(1) Comprehensive assessment and periodic reassessment of
individual needs, to determine the need for any medical, educational,
social, or other services. These assessment activities include the
following:
(i) Taking client history.
(ii) Identifying the needs of the individual, and completing
related documentation.
(iii) Gathering information from other sources, such as family
members, medical providers, social workers, and educators (if
necessary) to form a complete assessment of the eligible individual.
(2) Development (and periodic revision) of a specific care plan
based on the information collected through the assessment, that
includes the following:
(i) Specifies the goals and actions to address the medical, social,
educational, and other services needed by the eligible individual.
(ii) Includes activities such as ensuring the active participation
of the eligible individual and working with the individual (or the
individual's authorized health care decision maker) and others to
develop those goals.
(iii) Identifies a course of action to respond to the assessed
needs of the eligible individual.
(3) Referral and related activities (such as scheduling
appointments for the individual) to help the eligible individual obtain
needed services, including activities that help link the individual
with medical, social, and educational providers or other programs and
services that are capable of providing needed services to address
identified needs and achieve goals specified in the care plan.
(4) Monitoring and follow-up activities, including activities and
contacts that are necessary to ensure that the care plan is effectively
implemented and adequately addresses the needs of the eligible
individual and which may be with the individual, family members,
service providers, or other entities or individuals and conducted as
frequently as necessary, and including at least one annual monitoring,
to help determine whether the following conditions are met:
(i) Services are being furnished in accordance with the
individual's care plan.
(ii) Services in the care plan are adequate.
(iii) There are changes in the needs or status of the eligible
individual. Monitoring and follow-up activities include making
necessary adjustments in the care plan and service arrangements with
providers.
(e) Case management may include contacts with non-eligible
individuals that are directly related to the identification of the
eligible individual's needs and care, for the purposes of helping the
eligible individual access services, identifying needs and supports to
assist the eligible individual in obtaining services, providing case
managers with useful feedback, and alerting case managers to changes in
the eligible individual's needs.
Sec. 440.250 [Amended]
0
8. Section 440.250 is amended by--
0
A. Adding and reserving paragraph (q).
0
B. Adding a new paragraph (r).
The addition reads as follows:
Sec. 440.250 Limits on comparability of services.
* * * * *
(q) [Reserved]
(r) If specified in the plan, targeted case management services may
be limited to the following:
(1) Certain geographic areas within a State, without regard to the
statewide requirements in Sec. 431.50 of this chapter.
(2) Targeted groups specified by the State.
PART 441--SERVICES: REQUIREMENTS AND LIMITS APPLICABLE TO SPECIFIC
SERVICES
0
9. The authority citation for part 441 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
2. Section 441.10 is amended by adding a new paragraph (m) to read as
follows:
Sec. 441.10 Basis.
* * * * *
(m) Section 1905(a)(19) and 1915(g) of the Act for case management
services as set forth in Sec. 441.18 and section 8435 of the Technical
and Miscellaneous Revenue Act of 1988.
0
10. A new Sec. 441.18 is added to subpart A to read as follows:
Sec. 441.18 Case management services.
(a) If a State plan provides for case management services
(including targeted case management services), as defined in Sec.
440.169 of this chapter, the State must meet the following
requirements:
(1) Allow individuals the free choice of any qualified Medicaid
provider within the specified geographic area identified in the plan
when obtaining case management services, in accordance with Sec.
431.51 of this chapter, except as specified in paragraph (b) of this
section.
(2) Not use case management (including targeted case management)
services to restrict an individual's access to other services under the
plan.
(3) Not compel an individual to receive case management services,
condition receipt of case management (or targeted case management)
services on the receipt of other Medicaid services, or condition
receipt of other Medicaid services on receipt of case management (or
targeted case management) services.
(4) Indicate in the plan that case management services provided in
accordance with section 1915(g) of the Act will not duplicate payments
made to public agencies or private entities under the State plan and
other program authorities;
(5) Provide comprehensive case management services, on a one-to-one
basis, to an individual through one case manager.
(6) Prohibit providers of case management services from exercising
the agency's authority to authorize or deny the provision of other
services under the plan.
(7) Require providers to maintain case records that document for
all individuals receiving case management as follows:
(i) The name of the individual.
(ii) The dates of the case management services.
(iii) The name of the provider agency (if relevant) and the person
providing the case management service.
(iv) The nature, content, units of the case management services
received and whether goals specified in the care plan have been
achieved.
(v) Whether the individual has declined services in the care plan.
(vi) The need for, and occurrences of, coordination with other case
managers.
(vii) A timeline for obtaining needed services.
(viii) A timeline for reevaluation of the plan.
[[Page 68093]]
(8) Include a separate plan amendment for each group receiving case
management services that includes the following:
(i) Defines the group (and any subgroups within the group) eligible
to receive the case management services.
(ii) Identifies the geographic area to be served.
(iii) Describes the case management services furnished, including
the types of monitoring.
(iv) Specifies the frequency of assessments and monitoring and
provides a justification for those frequencies.
(v) Specifies provider qualifications that are reasonably related
to the population being served and the case management services
furnished.
(vi) Specifies the methodology under which case management
providers will be paid and rates are calculated that employs a unit of
service that does not exceed 15 minutes.
(vii) Specifies if case management services are being provided to
Medicaid-eligible individuals who are in institutions (except
individuals between ages 22 and 64 who are served in IMDs or
individuals who are inmates of public institutions).
(viii) Specifies if case management services are being provided to
individuals with long-term stays of 180 consecutive days or longer or
to individuals with short-term stays of less than 180 consecutive days.
When States choose to provide case management services to individuals
in institutions to facilitate transition to the community, the State
plan must include the following requirements:
(A) Specify the time period or other conditions under which case
management may be provided in this manner. The time period that case
management is provided in an institution must not exceed an
individual's length of stay;
(B) Specify the case management activities and include an assurance
that these activities are coordinated with and do not duplicate
institutional discharge planning;
(C) Include an assurance that the amount, duration, and scope of
the case management activities would be documented in an individual's
plan of care which includes case management activities prior to and
post-discharge, to facilitate a successful transition to community
living; and
(D) Specify that case management is only provided by and reimbursed
to community case management providers;
(E) Specify that Federal Financial Participation is only available
to community providers and will not be claimed on behalf of an
individual until discharge from the medical institution and enrollment
in community services; and
(F) Describe the system and process the State will use to monitor
providers' compliance with these provisions.
(9) Include a separate plan amendment for each subgroup within a
group if any of the following differs among the subgroups:
(i) The case management services to be furnished;
(ii) The qualifications of case management providers; or
(iii) The methodology under which case management providers will be
paid.
(b) If the State limits qualified providers of case management
services for target groups of individuals with developmental disability
or chronic mental illness, in accordance with Sec. 431.51(a)(4) of
this chapter, the plan must identify any limitations to be imposed on
the providers and specify how these limitations enable providers to
ensure that individuals within the target groups receive needed
services.
(c) Case management does not include, and FFP is not available in
expenditures for, services defined in Sec. 440.169 of this chapter
when any of the following conditions exist:
(1) Case management activities are an integral component of another
covered Medicaid service.
(2) The case management activities constitute the direct delivery
of underlying medical, educational, social, or other services to which
an eligible individual has been referred, including, but not limited
to, services under parole and probation programs, public guardianship
programs, special education programs, child welfare/child protective
services, and foster care programs.
(3) The activities are integral to the administration of foster
care programs, including but not limited to the following:
(i) Research gathering and completion of documentation required by
the foster care program.
(ii) Assessing adoption placements.
(iii) Recruiting or interviewing potential foster care parents.
(iv) Serving legal papers.
(v) Home investigations.
(vi) Providing transportation.
(vii) Administering foster care subsidies.
(viii) Making placement arrangements.
(4) The activities, for which an individual may be eligible, are
integral to the administration of another non-medical program, such as
a guardianship, child welfare/child protective services, parole,
probation, or special education program except for case management that
is included in an individualized education program or individualized
family service plan consistent with section 1903(c) of the Act.
(5) Activities that meet the definition of case management services
in Sec. 440.169 and under the approved State plan cannot be claimed as
administrative activities under Sec. 433.15(b).
(d) After the State assesses whether the activities are within the
scope of the case management benefit (applying the limitations
described above), in determining the allowable costs for case
management (or targeted case management) services that are also
furnished by another federally-funded program, the State must use cost
allocation methodologies, consistent with OMB Circular A-87, CMS
policies, or any subsequent guidance and reflected in an approved cost
allocation plan.
(Catalog of Federal Domestic Assistance Program, No. 93.778, Medical
Assistance Program.)
Dated: June 23, 2006.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
Approved: August 27, 2007.
Michael O. Leavitt,
Secretary.
[FR Doc. 07-5903 Filed 11-30-07; 8:45 am]
BILLING CODE 4120-01-P