Implementation of the Ensuring Access to Medicaid Services (CMS-2442-F) Final Rule: Part 3
Payment Rate Transparency 42 CFR § 447.203(b)(2) to (4): Payment Rate Disclosure
On May 10, 2024, the Centers for Medicare & Medicaid Services (CMS) published a final rule titled: Medicaid and Children’s Health Insurance Program (CHIP) Ensuring Access to Medicaid Services (CMS-2442-F). As we previously summarized in our May 2024 client alert, the final rule rescinds the existing access monitoring review plan (AMRP) requirements at 42 CFR § 447.203(b) and replaces them with new requirements for Medicaid fee-for-service (FFS) payment rate transparency.
To assist states in complying with these requirements, in July 2024, CMS published a Guide for States titled Ensuring Access to Medicaid Services – A Guide for States to the Fee-For-Service Provisions of the Final Rule. The Guide for States outlines comprehensive instructions relating to these requirements. We have included below a table from the Guide outlining the key provisions and applicability (compliance) dates.
| Part | Regulation Section(s) in Title 42 of the CFR | Applicability Dates* |
| 1 | Payment Rate Transparency Publication § 447.203(b)(1) | July 1, 2026, then updated within 30 days of a payment rate change. |
| 2 | Comparative Payment Rate Analysis Publication § 447.203(b)(2) to (4) | July 1, 2026, then every 2 years |
| 3 | Payment Rate Disclosure § 447.203(b)(2) to (4) | July 1, 2026, then every 2 years |
| 4 | Interested Parties Advisory Group § 447.203(b)(6) | The first meeting must be held within 2 years after effective date of the final rule, then at least every 2 years. |
| 5 | Rate Reduction and Restructuring SPA procedures § 447.203(c)(1) and (2) | July 9, 2024 |
This Client Alert Addresses Part 3 – Payment Rate Disclosure
By July 1, 2026, in addition to states publishing their Medicaid FFS payment rate schedules as required by 42 CFR § 447.203(b)(1), under 42 CFR § 447.203(b)(2) to (4), states must disclose the average hourly Medicaid rates paid for certain Home- and Community-Based Services (HCBS) on their Medicaid agency websites. Updates to these rates must be made at least every two years.
Key Disclosure Requirements
- Disclosure relates to payments made to provider agencies and individual providers of personal care, home health aide, homemaker, and habilitation services.
- To identify applicable services to report, CMS suggests that states review descriptions of their CPT and HCPCS codes.
- Habilitation services include any service provided as part of a residential, day, or home-based service, §447.203(b)(2)(iv) does not distinguish between these services.
- States must disclose the average hourly Medicaid FFS rates in effect as of July 1, 2025, to meet the first reporting requirement.
- States are required to disclose payment rates for services provided by individual and agency providers, if they vary. Individual providers are typically self-employed and enrolled with the state as Medicaid providers. Agency providers are entities enrolled with the state and employ direct care workers.
- States must convert any services paid for by a unit other than hourly (e.g., 15 minutes, daily, monthly) into an hourly rate equivalent. The converted rates will be used to calculate the overall average hourly Medicaid FFS rate to disclose. The guidance suggests that a simple average should be calculated.
- Negotiated rates and services delivered under a self-directed program are not subject to the payment rate disclosure provision.
- The disclosure is required to be separated by category of service (i.e., personal care, home health aide, homemaker, and habilitation) and must identify the following:
- The average hourly Medicaid FFS rate paid, excluding facility-related costs;
- The average hourly rate related to any facility-related costs, if applicable;
- Identify if the average hourly payment rate is different for individual vs. agency providers;
- Identify payments between adult and pediatric services;
- Identify payment rate variances based on geographical location, if applicable;
- The number of Medicaid paid claims;
- The number of Medicaid-enrolled beneficiaries who received services within the calendar year related to the published Medicaid payment rate.
- The Medicaid paid claims and enrolled beneficiaries must indicate if an individual provider vs. an agency provider delivered the service.
How Myers and Stauffer Can Help
Myers and Stauffer has nearly 50 years of Medicare and Medicaid experience and expertise in the required principles for setting rates and developing payment systems. For many of our rate setting engagements, our procedures include calculating reimbursement rates, developing rate schedules for publication, preparing comparisons to Medicare, facilitating stakeholder engagement, and other activities that support accurate and transparent reimbursement rates. Our experienced team is ready to support states in ensuring timely compliance with the federal rate transparency requirements.
| Tim Guerrant, CPA Member |
Jared Duzan, CFE Member |
Joe Gamis, CFE, MBA Principal |
| Jeffery Marston Member |
Daniel Brendel Principal |
Tara Clark, CPA Member |
| John Dresslar, CPA Member |
Bobby Courtney, MPH, JD Principal |
Megan Frenzen, MBA, MSc, PhD Principal |
| Scott Price, CPA, CFE, PMP, CGMA Member |
Krista Stephani, CPA Member |
