Payment Rate Transparency Standards

CMS Final Rules: Implementation of CMS-2442-F and CMS-2439-F Transparency Requirements, 42 CFR §§ 447.203 and 438.207

On May 10, 2024, the Centers for Medicare & Medicaid Services (CMS) published final rules titled Medicaid and Children’s Health Insurance Program (CHIP) Ensuring Access to Medicaid Services (CMS-2442-F) and Medicaid and Children’s Health Insurance Program (CHIP) Managed Care Access, Finance, and Quality (CMS-2439-F).

CMS-2442-F rescinds the access monitoring review plan requirements and replaces them with new requirements for Medicaid fee-for-service (FFS) access to care and payment rate transparency, as outlined in Parts 1 through 5 below. CMS-2439-F implements new Medicaid managed care payment rate transparency requirements to allow for monitoring payment-related access to care barriers, as outlined in Part 6 below.

To assist states in complying with the CMS-2442-F requirements, in July 2024, CMS published a Guide for States (the Guide) titled Ensuring Access to Medicaid Services – A Guide for States to the Fee-For-Service Provisions of the Final Rule. The Guide outlines comprehensive instructions relating to these requirements. Below are highlights from the Guide outlining the key transparency requirements and applicability (compliance) dates. For additional information, refer to our full client alert: Implementation of the Ensuring Access to Medicaid Services (CMS- 2442-F) Final Rule: Parts 1 – Part 5.

Part 1 – Payment Rate Transparency Publication

Applicability Date: July 1, 2026, then updated within 30 days of a payment rate change

States must publish Medicaid FFS rates on a public-facing website by July 1, 2026. The requirement extends to all Medicaid rates for all providers and services, except federally qualified health center (FQHC), rural health clinic (RHC), and certified community behavioral health clinic (CCBHC) demonstration rates.
The Guide contains specific content requirements for the published rates. For example, rates that vary by population (adult versus pediatric), provider type, or geographic location must be separately published. For many states, this will require revising current rate schedules.
The published rates must be organized in a manner that allows the public to easily locate and understand the rates.
Bundled rates and value-based payment amounts must identify each component service if based on FFS rates.

Part 2 – Comparative Payment Rate Analysis

Applicability Dates: July 1, 2026, then every two years

States must conduct a comparative analysis of Medicaid rates to corresponding Medicare rates. The requirement applies only to certain evaluation and management (E/M) codes related to primary care, obstetrical and gynecological care, and outpatient mental health, and substance use disorder services.
The first comparative analysis is for calendar year (CY) 2025, and CMS has identified 68 E/M codes subject to this analysis.
The analysis must show the Medicaid rate as a percentage of the Medicare non-facility rate for each code. In addition, the analysis must include the number of Medicaid-paid claims and the number of Medicaid beneficiaries who received the service during the prior CY.

Part 3 – Home and Community-Based Services (HCBS) Payment Rate Disclosure

Applicability Dates: July 1, 2026, then every two years

States must calculate and publish the average hourly Medicaid FFS rates paid for personal care, home health aide, homemaker, and habilitation services provided by agencies and individual providers.
States must disclose the average hourly Medicaid FFS rates in effect as of July 1, 2025, to meet the first reporting requirement.
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.
States must identify any rate variances based on population (adult versus pediatric) or geographic location.
Payments made for facility-related costs must be separately identified.

Part 4 – Interested Parties Advisory Group

Applicability Dates: July 9, 2026, then every two years (CMS has delayed enforcement to January 1, 2029)

State Medicaid agencies must establish and convene an Interested Parties Advisory Group by July 9, 2026 (enforcement by CMS delayed to January 1, 2029), to advise and consult on FFS HCBS payments made to direct care workers providing self-directed and agency-directed personal care, home health aide, homemaker, and habilitation services as authorized under the State Plan, 1915(c) waivers, and demonstration programs.
The Advisory Group will consult on payment adequacy and access metrics to ensure sufficient rates for the specified services.
States are tasked with providing the Advisory Group with training, guidance, and context to support informed recommendations.

Part 5 – Rate Reduction and Restructuring State Plan Amendment (SPA) Procedures

Applicability Date: July 9, 2024

States are required to conduct additional analysis for any SPA that results in a reduction to or restructuring of Medicaid reimbursement rates. The analyses must accompany the SPA submission to CMS.
The analysis is intended to determine if the proposed changes result in diminished access to care.
The requirement applies to all Medicaid FFS services under the Medicaid State Plan, including FQHC, RHC, clinic, dental, community mental health services, home care services (including personal care and home health services), and services covered under section 1915 authorities and demonstration authorities.
CMS has specific content requirements for this analysis and has made a Reduction and Restructuring Workbook available to support states.

Part 6 – Annual Managed Care Payment Analysis

Applicability Date: No later than the first rating period beginning on or after July 9, 2026, then annually or any time there is a significant change

States are required to mandate that managed care organizations (MCOs) conduct payment analyses and submit annual documentation to the state in a format specified by the state. The previously referenced FFS Guide could serve as a foundation for developing a standardized template for MCO reporting.
The payment analysis of managed care rates compared to corresponding Medicare rates, in the aggregate, is required for certain E/M codes for primary care, obstetrical and gynecological, mental health, and substance use disorder services as outlined above.
The payment analysis of managed care rates compared to corresponding Medicaid FFS program rates, in the aggregate, is required for homemaker services, home health aide services, personal care services, and habilitation services as outlined above.
A separate total and percentage must be reported for each service type; if the percentage differs between adult and pediatric services, the percentages must be reported separately. Payments by the MCO when it is not the primary payer are excluded from the analysis, as are services furnished by FQHCs and RHCs.
States are required to review the documentation submitted by the MCOs, submit an assurance of compliance to CMS, including state-level payment percentages, and post the report on its website within 30 calendar days of the submission to CMS.

How Myers and Stauffer Can Help

Myers and Stauffer has nearly 50 years of Medicare and Medicaid knowledge regarding required principles that must be followed to set rates and develop 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.

Myers and Stauffer also partners with nearly 30 states and CMS in ensuring proper oversight of MCOs and compliance with CMS regulatory requirements. Our managed care engagements include validation of the accuracy of self-reported MCO data, designing standardized reporting tools and instructions, as well as comparative data analysis. Our experienced teams are ready to support states in ensuring timely compliance with the federal rate transparency requirements.

Dan Brendel Principal	Tara Clark, CPA Member	Jared Duzan, CFE Principal	Joe Gamis, CFE, MBA Principal
Tim Guerrant, CPA Member	Judy Hatfield, CPA Member	Janae Jensen, CPA Member	Krista Stephani, CPA Member