CMS proposes new rules on Medicaid coverage, cost-sharing

Last Thursday the Centers for Medicare and Medicaid Services (CMS) announced two proposed rule changes that the agency said would grant states "unprecedented flexibility" in designing Medicaid programs even as the rules required more cost sharing for beneficiaries. (Source: CQ HealthBeat via American Health Line.) According to CMS, the proposed rules are part of efforts to implement the Bush administration's "goals of aligning Medicaid more closely with private market insurance and giving states more control over their Medicaid benefits packages."

As reported in American Health Line, "The rule changes would allow states to offer alternative benefit packages called benchmark plans, which would provide Medicaid beneficiaries with health coverage that has the same value as plans offered to other individuals in the same state. Benchmarks would include the standard PPO plan offered to federal government employees, state employee coverage offered by the largest HMO or coverage approved by (United States Department of Health and Human Services). States would have the choice of offering additional benefits such as dental coverage. States also would be able to contribute to a beneficiary's employer-sponsored health plan premiums so that the individual could remain insured through the private sector." As part of these rules, states could also increase cost sharing for beneficiaries with incomes between 100% and 150% of the federal poverty level, while beneficiaries with incomes greater than 150% of the poverty level could be required to contribute copayments.