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AAMC Submits Comments on Proposed Medicaid Fiscal Accountability Regulation

January 31, 2020

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Ivy Baer, Senior Director and Regulatory Counsel

The AAMC submitted a Jan. 31 comment letter to the Centers for Medicare and Medicaid Services (CMS) urging the Agency to withdraw the proposed Medicaid Fiscal Accountability Regulation (MFAR) for a number of reasons, including that the proposed regulation does not comply with the law.

The rule proposes a cap on physician supplemental payments and new limits on funds that could be used for Intergovernmental Transfers under Medicaid fee-for service [see Washington Highlights, Nov. 14, 2019].

The AAMC’s comment letter notes that the proposed rule would upend the methods that many states have used to fund their Medicaid programs and would likely result in millions of individuals no longer being able to receive care through Medicaid. The proposal also would have a severe impact on providers who rely on those funds to care for vulnerable patients and could cause state Medicaid programs to limit or eliminate graduate medical education funding, thus endangering training programs and reducing beneficiary access.

The AAMC’s comments highlight that “supplemental payments are a long-standing and essential part of the Medicaid program, making up a quarter of all Medicaid payments to hospitals nationwide and being a significant source of funding for teaching hospitals as well as many physicians who practice at teaching hospitals and medical schools who provide significant care for Medicaid beneficiaries.”

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