GME Payments Preserved Under
Medicaid Managed Care Final Rule
June 21, 2002- According to a final rule published
by the Centers for Medicare and Medicaid Services (CMS) on
June 14, 2002 [67
Federal Register 40989], State Medicaid programs
will continue to be permitted to make graduate medical education
(GME) payments directly to teaching hospitals under their
managed care programs.
Currently, a number of states provide GME payments under
their Medicaid managed care programs. Included as part of
a proposed rule published last summer that made a number of
changes to Medicaid managed care programs generally, was a
provision entitled "limit on payment to other providers"
(section 438.60). While the provision never addressed GME
payments explicitly, CMS staff confirmed that the proposed
provision, if finalized, would preclude states from "carving
out" GME payments from managed care plans' capitation
rates and making those payments directly to teaching hospitals.
Instead, GME payments would be required to be included in
managed care plans' capitation rates.
In an effort led by the AAMC, numerous associations and hospitals
urged CMS to reconsider its position. Commenters noted that
the Medicare program explicitly carves out GME payments and
makes those payments directly to teaching hospitals. While
CMS might not want to follow Medicare's lead and mandate carve-outs,
commenters felt that, at a minimum, Medicaid managed care
programs should be given the choice as to how they wanted
to distribute GME payments.
The final rule expressly exempts GME payments from section
438.60. Specifically, the provision requires states to ensure
that "no payment is made to a provider other than a [managed
care plan] . . . except . . . when the State agency has adjusted
the capitation rates paid under the contract . . . to make
payments for graduate medical education."
In the final rule's preamble, CMS noted that GME payments
were a common practice in many state Medicaid programs. However,
the preamble noted CMS' continuing interest in this topic:
"As part of our larger strategy of improving the fiscal
integrity of Medicaid payments, we also plan to study existing
Medicaid GME payment arrangements and may issue additional
policies in the future."
Information:
Karen Fisher, Senior Associate Vice President
AAMC Health Care Affairs
kfisher@aamc.org
(202) 862-6140
Get Washington Highlights
in your Inbox!
| 
