01-4738. Medicaid Program; Medicaid Managed Care: Delay of Effective Date

AGENCY:

Health Care Financing Administration (HCFA), HHS.

ACTION:

Final rule; delay of effective date.

SUMMARY:

In accordance with the memorandum of January 20, 2001, from the Assistant to the President and Chief of Staff, entitled “Regulatory Review Plan,” published in the January 24, 2001 Federal Register, this action temporarily delays for 60 days the effective date of the final rule entitled “Medicaid Program; Medicaid Managed Care” published in the January 19, 2001 Federal Register (66 FR 6227). That final rule amends the Medicaid regulations to implement provisions of the Balanced Budget Act of 1997 (BBA) that allow the States greater flexibility by permitting them to amend their State plan to require certain categories of Medicaid beneficiaries to enroll in managed care entities without obtaining waivers if beneficiary choice is provided; establish new beneficiary protections in areas such as quality assurance, grievance rights, and coverage of emergency services; eliminate certain requirements viewed by State agencies as impediments to the growth of managed care programs, such as the enrollment composition requirement, the right to disenroll without cause at any time, and the prohibition against enrollee cost-sharing. In addition, that final rule expands on regulatory beneficiary protections provided to enrollees of prepaid health plans (PHPs) by requiring that PHPs comply with specified BBA requirements that would not otherwise apply to PHPs.

The effective date of that rule, which would have been April 19, 2001, is now June 18, 2001. The temporary 60-day delay in effective date is necessary to give Department officials the opportunity for further review and consideration of new regulations, consistent with the Assistant to the President's memorandum of January 20, 2001. Additionally, due to this delay in the effective date of the rule, the implementation date of the rule, which would have also been April 19, 2001, is now June 18, 2001. Therefore, provisions of the rule that must be implemented through contracts with managed care organizations, prepaid health plans, health insuring organizations, or enrollment brokers are effective with respect to contracts that are up for renewal or renegotiation on or after June 18, 2001, but no later than June 18, 2002.

To the extent that 5 U.S.C. section 553 applies to this action, it is exempt from notice and comment because it constitutes a rule of procedure under 5 U.S.C. section 553 (b)(3)(1). Alternatively, HCFA's implementation of this rule without opportunity for public comment, effective immediately upon publication today in the Federal Register, is based on the good cause exceptions in 5 U.S.C. sections 553(b)(3)(B) and 553(d)(3), in that seeking public comment is impracticable, unnecessary, and contrary to the public interest. Given the imminence of the effective date, seeking prior public comment on this temporary delay would have been impractical, as well as contrary to the public interest, in the orderly promulgation and implementation of regulations.

DATES:

The effective date of the rule amending 42 CFR parts 400, 430, 431, 434, 435, 438, 440, and 447 published in the January 19, 2001 Federal Register (66 FR 6228) is delayed 60 days until June 18, 2001.

Additionally, the implementation date of the rule is delayed until June 18, 2001. Therefore, provisions of the rule that must be implemented through contracts with managed care organizations, prepaid health plans, health insuring organizations, or enrollment brokers are effective with respect to contracts that are up for renewal or renegotiation on or after June 18, 2001, but no later than June 18, 2002.

FOR FURTHER INFORMATION CONTACT:

Bruce Johnson [phone].

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical Assistance Program)

Dated: February 21, 2001.

Michael McMullan,

Acting Deputy Administrator, Health Care Financing Administration.

Approved: February 22, 2001.

Tommy G. Thompson,

Secretary.