42 C.F.R. Subpart A—General Provisions
Title 42 - Public Health
(a) Statutory basis. This part is based on sections 1902(a)(4), 1903(m), 1905(t), and 1932 of the Act. (1) Section 1902(a)(4) requires that States provide for methods of administration that the Secretary finds necessary for proper and efficient operation of the State plan. The application of the requirements of this part to PIHPs and PAHPs that do not meet the statutory definition of an MCO or a PCCM is under the authority in section 1902(a)(4). (2) Section 1903(m) contains requirements that apply to comprehensive risk contracts. (3) Section 1903(m)(2)(H) provides that an enrollee who loses Medicaid eligibility for not more than 2 months may be enrolled in the succeeding month in the same MCO or PCCM if that MCO or PCCM still has a contract with the State. (4) Section 1905(t) contains requirements that apply to PCCMs. (5) Section 1932— (i) Provides that, with specified exceptions, a State may require Medicaid recipients to enroll in MCOs or PCCMs; (ii) Establishes the rules that MCOs, PCCMs, the State, and the contracts between the State and those entities must meet, including compliance with requirements in sections 1903(m) and 1905(t) of the Act that are implemented in this part; (iii) Establishes protections for enrollees of MCOs and PCCMs; (iv) Requires States to develop a quality assessment and performance improvement strategy; (v) Specifies certain prohibitions aimed at the prevention of fraud and abuse; (vi) Provides that a State may not enter into contracts with MCOs unless it has established intermediate sanctions that it may impose on an MCO that fails to comply with specified requirements; and (vii) Makes other minor changes in the Medicaid program. (b) Scope. This part sets forth requirements, prohibitions, and procedures for the provision of Medicaid services through MCOs, PIHPs, PAHPs, and PCCMs. Requirements vary depending on the type of entity and on the authority under which the State contracts with the entity. Provisions that apply only when the contract is under a mandatory managed care program authorized by section 1932(a)(1)(A) of the Act are identified as such. As used in this part— Capitation payment means a payment the State agency makes periodically to a contractor on behalf of each recipient enrolled under a contract for the provision of medical services under the State plan. The State agency makes the payment regardless of whether the particular recipient receives services during the period covered by the payment. Comprehensive risk contract means a risk contract that covers comprehensive services, that is, inpatient hospital services and any of the following services, or any three or more of the following services: (1) Outpatient hospital services. (2) Rural health clinic services. (3) FQHC services. (4) Other laboratory and X-ray services. (5) Nursing facility (NF) services. (6) Early and periodic screening, diagnostic, and treatment (EPSDT) services. (7) Family planning services. (8) Physician services. (9) Home health services. Federally qualified HMO means an HMO that CMS has determined is a qualified HMO under section 1310(d) of the PHS Act. Health care professional means a physician or any of the following: a podiatrist, optometrist, chiropractor, psychologist, dentist, physician assistant, physical or occupational therapist, therapist assistant, speech-language pathologist, audiologist, registered or practical nurse (including nurse practitioner, clinical nurse specialist, certified registered nurse anesthetist, and certified nurse midwife), licensed certified social worker, registered respiratory therapist, and certified respiratory therapy technician. Health insuring organization (HIO) means a county operated entity, that in exchange for capitation payments, covers services for recipients— (1) Through payments to, or arrangements with, providers; (2) Under a comprehensive risk contract with the State; and (3) Meets the following criteria— (i) First became operational prior to January 1, 1986; or (ii) Is described in section 9517(e)(3) of the Omnibus Budget Reconciliation Act of 1985 (as amended by section 4734 of the Omnibus Budget Reconciliation Act of 1990). Managed care organization (MCO) means an entity that has, or is seeking to qualify for, a comprehensive risk contract under this part, and that is— (1) A Federally qualified HMO that meets the advance directives requirements of subpart I of part 489 of this chapter; or (2) Any public or private entity that meets the advance directives requirements and is determined to also meet the following conditions: (i) Makes the services it provides to its Medicaid enrollees as accessible (in terms of timeliness, amount, duration, and scope) as those services are to other Medicaid recipients within the area served by the entity. (ii) Meets the solvency standards of §438.116. Nonrisk contract means a contract under which the contractor— (1) Is not at financial risk for changes in utilization or for costs incurred under the contract that do not exceed the upper payment limits specified in §447.362 of this chapter; and (2) May be reimbursed by the State at the end of the contract period on the basis of the incurred costs, subject to the specified limits. Prepaid ambulatory health plan (PAHP) means an entity that— (1) Provides medical services to enrollees under contract with the State agency, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates; (2) Does not provide or arrange for, and is not otherwise responsible for the provision of any inpatient hospital or institutional services for its enrollees; and (3) Does not have a comprehensive risk contract. Prepaid inpatient health plan (PIHP) means an entity that— (1) Provides medical services to enrollees under contract with the State agency, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates; (2) Provides, arranges for, or otherwise has responsibility for the provision of any inpatient hospital or institutional services for its enrollees; and (3) Does not have a comprehensive risk contract. Primary care means all health care services and laboratory services customarily furnished by or through a general practitioner, family physician, internal medicine physician, obstetrician/gynecologist, or pediatrician, to the extent the furnishing of those services is legally authorized in the State in which the practitioner furnishes them. Primary care case management means a system under which a PCCM contracts with the State to furnish case management services (which include the location, coordination and monitoring of primary health care services) to Medicaid recipients. Primary care case manager (PCCM) means a physician, a physician group practice, an entity that employs or arranges with physicians to furnish primary care case management services or, at State option, any of the following: (1) A physician assistant. (2) A nurse practitioner. (3) A certified nurse-midwife. Risk contract means a contract under which the contractor— (1) Assumes risk for the cost of the services covered under the contract; and (2) Incurs loss if the cost of furnishing the services exceeds the payments under the contract. (a) Regional office review. The CMS Regional Office must review and approve all MCO, PIHP, and PAHP contracts, including those risk and nonrisk contracts that, on the basis of their value, are not subject to the prior approval requirement in §438.806. (b) Entities eligible for comprehensive risk contracts. A State agency may enter into a comprehensive risk contract only with the following: (1) An MCO. (2) The entities identified in section 1903(m)(2)(B)(i), (ii), and (iii) of the Act. (3) Community, Migrant, and Appalachian Health Centers identified in section 1903(m)(2)(G) of the Act. Unless they qualify for a total exemption under section 1903(m)(2)(B) of the Act, these entities are subject to the regulations governing MCOs under this part. (4) An HIO that arranges for services and became operational before January 1986. (5) An HIO described in section 9517(c)(3) of the Omnibus Budget Reconciliation Act of 1985 (as added by section 4734(2) of the Omnibus Budget Reconciliation Act of 1990). (c) Payments under risk contracts—(1) Terminology. As used in this paragraph, the following terms have the indicated meanings: (i) Actuarially sound capitation rates means capitation rates that— (A) Have been developed in accordance with generally accepted actuarial principles and practices; (B) Are appropriate for the populations to be covered, and the services to be furnished under the contract; and (C) Have been certified, as meeting the requirements of this paragraph (c), by actuaries who meet the qualification standards established by the American Academy of Actuaries and follow the practice standards established by the Actuarial Standards Board. (ii) Adjustments to smooth data means adjustments made, by cost-neutral methods, across rate cells, to compensate for distortions in costs, utilization, or the number of eligibles. (iii) Cost neutral means that the mechanism used to smooth data, share risk, or adjust for risk will recognize both higher and lower expected costs and is not intended to create a net aggregate gain or loss across all payments. (iv) Incentive arrangement means any payment mechanism under which a contractor may receive additional funds over and above the capitation rates it was paid for meeting targets specified in the contract. (v) Risk corridor means a risk sharing mechanism in which States and contractors share in both profits and losses under the contract outside of predetermined threshold amount, so that after an initial corridor in which the contractor is responsible for all losses or retains all profits, the State contributes a portion toward any additional losses, and receives a portion of any additional profits. (2) Basic requirements. (i) All payments under risk contracts and all risk-sharing mechanisms in contracts must be actuarially sound. (ii) The contract must specify the payment rates and any risk-sharing mechanisms, and the actuarial basis for computation of those rates and mechanisms. (3) Requirements for actuarially sound rates. In setting actuarially sound capitation rates, the State must apply the following elements, or explain why they are not applicable: (i) Base utilization and cost data that are derived from the Medicaid population, or if not, are adjusted to make them comparable to the Medicaid population. (ii) Adjustments made to smooth data and adjustments to account for factors such as medical trend inflation, incomplete data, MCO, PIHP, or PAHP administration (subject to the limits in paragraph (c)(4)(ii) of this section), and utilization; (iii) Rate cells specific to the enrolled population, by— (A) Eligibility category; (B) Age; (C) Gender; (D) Locality/region; and (E) Risk adjustments based on diagnosis or health status (if used). (iv) Other payment mechanisms and utilization and cost assumptions that are appropriate for individuals with chronic illness, disability, ongoing health care needs, or catastrophic claims, using risk adjustment, risk sharing, or other appropriate cost-neutral methods. (4) Documentation. The State must provide the following documentation: (i) The actuarial certification of the capitation rates. (ii) An assurance (in accordance with paragraph (c)(3) of this section) that all payment rates are— (A) Based only upon services covered under the State plan (or costs directly related to providing these services, for example, MCO, PIHP, or PAHP administration). (B) Provided under the contract to Medicaid-eligible individuals. (iii) The State's projection of expenditures under its previous year's contract (or under its FFS program if it did not have a contract in the previous year) compared to those projected under the proposed contract. (iv) An explanation of any incentive arrangements, or stop-loss, reinsurance, or any other risk-sharing methodologies under the contract. (5) Special contract provisions. (i) Contract provisions for reinsurance, stop-loss limits or other risk-sharing methodologies must be computed on an actuarially sound basis. (ii) If risk corridor arrangements result in payments that exceed the approved capitation rates, these excess payments will not be considered actuarially sound to the extent that they result in total payments that exceed the amount Medicaid would have paid, on a fee-for-service basis, for the State plan services actually furnished to enrolled individuals, plus an amount for MCO, PIHP, or PAHP administrative costs directly related to the provision of these services. (iii) Contracts with incentive arrangements may not provide for payment in excess of 105 percent of the approved capitation payments attributable to the enrollees or services covered by the incentive arrangement, since such total payments will not be considered to be actuarially sound. (iv) For all incentive arrangements, the contract must provide that the arrangement is— (A) For a fixed period of time; (B) Not to be renewed automatically; (C) Made available to both public and private contractors; (D) Not conditioned on intergovernmental transfer agreements; and (E) Necessary for the specified activities and targets. (v) If a State makes payments to providers for graduate medical education (GME) costs under an approved State plan, the State must adjust the actuarially sound capitation rates to account for the GME payments to be made on behalf of enrollees covered under the contract, not to exceed the aggregate amount that would have been paid under the approved State plan for FFS. States must first establish actuarially sound capitation rates prior to making adjustments for GME. (d) Enrollment discrimination prohibited. Contracts with MCOs, PIHPs, PAHPs, and PCCMs must provide as follows: (1) The MCO, PIHP, PAHP, or PCCM accepts individuals eligible for enrollment in the order in which they apply without restriction (unless authorized by the Regional Administrator), up to the limits set under the contract. (2) Enrollment is voluntary, except in the case of mandatory enrollment programs that meet the conditions set forth in §438.50(a). (3) The MCO, PIHP, PAHP, or PCCM will not, on the basis of health status or need for health care services, discriminate against individuals eligible to enroll. (4) The MCO, PIHP, PAHP, or PCCM will not discriminate against individuals eligible to enroll on the basis of race, color, or national origin, and will not use any policy or practice that has the effect of discriminating on the basis of race, color, or national origin. (e) Services that may be covered. An MCO, PIHP, or PAHP contract may cover, for enrollees, services that are in addition to those covered under the State plan, although the cost of these services cannot be included when determining the payment rates under §438.6(c). (f) Compliance with contracting rules. All contracts under this subpart must: (1) Comply with all applicable Federal and State laws and regulations including title VI of the Civil Rights Act of 1964; title IX of the Education Amendments of 1972 (regarding education programs and activities); the Age Discrimination Act of 1975; the Rehabilitation Act of 1973; and the Americans with Disabilities Act; and (2) Meet all the requirements of this section. (g) Inspection and audit of financial records. Risk contracts must provide that the State agency and the Department may inspect and audit any financial records of the entity or its subcontractors. (h) Physician incentive plans. (1) MCO, PIHP, and PAHP contracts must provide for compliance with the requirements set forth in §§422.208 and 422.210 of this chapter. (2) In applying the provisions of §§422.208 and 422.210 of this chapter, references to “M+C organization”, “CMS”, and “Medicare beneficiaries” must be read as references to “MCO, PIHP, or PAHP”, “State agency” and “Medicaid recipients”, respectively. (i) Advance directives. (1) All MCO and PIHP contracts must provide for compliance with the requirements of §422.128 of this chapter for maintaining written policies and procedures for advance directives. (2) All PAHP contracts must provide for compliance with the requirements of §422.128 of this chapter for maintaining written policies and procedures for advance directives if the PAHP includes, in its network, any of those providers listed in §489.102(a) of this chapter. (3) The MCO, PIHP, or PAHP subject to this requirement must provide adult enrollees with written information on advance directives policies, and include a description of applicable State law. (4) The information must reflect changes in State law as soon as possible, but no later than 90 days after the effective date of the change. (j) Special rules for certain HIOs. Contracts with HIOs that began operating on or after January 1, 1986, and that the statute does not explicitly exempt from requirements in section 1903(m) of the Act, are subject to all the requirements of this part that apply to MCOs and contracts with MCOs. These HIOs may enter into comprehensive risk contracts only if they meet the criteria of paragraph (a) of this section. (k) Additional rules for contracts with PCCMs. A PCCM contract must meet the following requirements: (1) Provide for reasonable and adequate hours of operation, including 24-hour availability of information, referral, and treatment for emergency medical conditions. (2) Restrict enrollment to recipients who reside sufficiently near one of the manager's delivery sites to reach that site within a reasonable time using available and affordable modes of transportation. (3) Provide for arrangements with, or referrals to, sufficient numbers of physicians and other practitioners to ensure that services under the contract can be furnished to enrollees promptly and without compromise to quality of care. (4) Prohibit discrimination in enrollment, disenrollment, and re-enrollment, based on the recipient's health status or need for health care services. (5) Provide that enrollees have the right to disenroll from their PCCM in accordance with §438.56(c). (l) Subcontracts. All subcontracts must fulfill the requirements of this part that are appropriate to the service or activity delegated under the subcontract. (m) Choice of health professional. The contract must allow each enrollee to choose his or her health professional to the extent possible and appropriate. (a) The following requirements and options apply to PIHPs, PIHP contracts, and States with respect to PIHPs, to the same extent that they apply to MCOs, MCO contracts, and States for MCOs. (1) The contract requirements of §438.6, except for requirements that pertain to HIOs. (2) The information requirements in §438.10. (3) The provision against provider discrimination in §438.12. (4) The State responsibility provisions of subpart B of this part except §438.50. (5) The enrollee rights and protection provisions in subpart C of this part. (6) The quality assessment and performance improvement provisions in subpart D of this part to the extent that they are applicable to services furnished by the PIHP. (7) The grievance system provisions in subpart F of this part. (8) The certification and program integrity protection provisions set forth in subpart H of this part. (b) The following requirements and options for PAHPs apply to PAHPs, PAHP contracts, and States. (1) The contract requirements of §438.6, except requirements for— (i) HIOs. (ii) Advance directives (unless the PAHP includes any of the providers listed in §489.102) of this chapter. (2) All applicable portions of the information requirements in §438.10. (3) The provision against provider discrimination in §438.12. (4) The State responsibility provisions of subpart B of this part except §438.50. (5) The provisions on enrollee rights and protections in subpart C of this part. (6) Designated portions of subpart D of this part. (7) An enrollee's right to a State fair hearing under subpart E of part 431 of this chapter. (8) Prohibitions against affiliations with individuals debarred by Federal agencies in §438.610. [67 FR 41095, June 14, 2002, as amended at 67 FR 65505, Oct. 25, 2002] (a) Terminology. As used in this section, the following terms have the indicated meanings: Enrollee means a Medicaid recipient who is currently enrolled in an MCO, PIHP, PAHP, or PCCM in a given managed care program. Potential enrollee means a Medicaid recipient who is subject to mandatory enrollment or may voluntarily elect to enroll in a given managed care program, but is not yet an enrollee of a specific MCO, PIHP, PAHP, or PCCM. (b) Basic rules. (1) Each State, enrollment broker, MCO, PIHP, PAHP, and PCCM must provide all enrollment notices, informational materials, and instructional materials relating to enrollees and potential enrollees in a manner and format that may be easily understood. (2) The State must have in place a mechanism to help enrollees and potential enrollees understand the State's managed care program. (3) Each MCO and PIHP must have in place a mechanism to help enrollees and potential enrollees understand the requirements and benefits of the plan. (c) Language. The State must do the following: (1) Establish a methodology for identifying the prevalent non-English languages spoken by enrollees and potential enrollees throughout the State. “Prevalent” means a non-English language spoken by a significant number or percentage of potential enrollees and enrollees in the State. (2) Make available written information in each prevalent non-English language. (3) Require each MCO, PIHP, PAHP, and PCCM to make its written information available in the prevalent non-English languages in its particular service area. (4) Make oral interpretation services available and require each MCO, PIHP, PAHP, and PCCM to make those services available free of charge to each potential enrollee and enrollee. This applies to all non-English languages, not just those that the State identifies as prevalent. (5) Notify enrollees and potential enrollees, and require each MCO, PIHP, PAHP, and PCCM to notify its enrollees— (i) That oral interpretation is available for any language and written information is available in prevalent languages; and (ii) How to access those services. (d) Format. (1) Written material must— (i) Use easily understood language and format; and (ii) Be available in alternative formats and in an appropriate manner that takes into consideration the special needs of those who, for example, are visually limited or have limited reading proficiency. (2) All enrollees and potential enrollees must be informed that information is available in alternative formats and how to access those formats. (e) Information for potential enrollees. (1) The State or its contracted representative must provide the information specified in paragraph (e)(2) of this section to each potential enrollee as follows: (i) At the time the potential enrollee first becomes eligible to enroll in a voluntary program, or is first required to enroll in a mandatory enrollment program. (ii) Within a timeframe that enables the potential enrollee to use the information in choosing among available MCOs, PIHPs, PAHPs, or PCCMs. (2) The information for potential enrollees must include the following: (i) General information about— (A) The basic features of managed care; (B) Which populations are excluded from enrollment, subject to mandatory enrollment, or free to enroll voluntarily in the program; and (C) MCO, PIHP, PAHP, and PCCM responsibilities for coordination of enrollee care; (ii) Information specific to each MCO, PIHP, PAHP, or PCCM program operating in potential enrollee's service area. A summary of the following information is sufficient, but the State must provide more detailed information upon request: (A) Benefits covered. (B) Cost sharing, if any. (C) Service area. (D) Names, locations, telephone numbers of, and non-English language spoken by current contracted providers, and including identification of providers that are not accepting new patients. For MCOs, PIHPs, and PAHPs, this includes at a minimum information on primary care physicians, specialists, and hospitals. (E) Benefits that are available under the State plan but are not covered under the contract, including how and where the enrollee may obtain those benefits, any cost sharing, and how transportation is provided. For a counseling or referral service that the MCO, PIHP, PAHP, or PCCM does not cover because of moral or religious objections, the State must provide information about where and how to obtain the service. (f) General information for all enrollees of MCOs, PIHPs, PAHPs, and PCCMs. Information must be furnished to MCO, PIHP, PAHP, and PCCM enrollees as follows: (1) The State must notify all enrollees of their disenrollment rights, at a minimum, annually. For States that choose to restrict disenrollment for periods of 90 days or more, States must send the notice no less than 60 days before the start of each enrollment period. (2) The State, its contracted representative, or the MCO, PIHP, PAHP, or PCCM must notify all enrollees of their right to request and obtain the information listed in paragraph (f)(6) of this section and, if applicable, paragraphs (g) and (h) of this section, at least once a year. (3) The State, its contracted representative, or the MCO, PIHP, PAHP, or PCCM must furnish to each of its enrollees the information specified in paragraph (f)(6) of this section and, if applicable, paragraphs (g) and (h) of this section, within a reasonable time after the MCO, PIHP, PAHP, or PCCM receives, from the State or its contracted representative, notice of the recipient's enrollment. (4) The State, its contracted representative, or the MCO, PIHP, PAHP, or PCCM must give each enrollee written notice of any change (that the State defines as “significant”) in the information specified in paragraphs (f)(6) of this section and, if applicable, paragraphs (g) and (h) of this section, at least 30 days before the intended effective date of the change. (5) The MCO, PIHP, and, when appropriate, the PAHP or PCCM, must make a good faith effort to give written notice of termination of a contracted provider, within 15 days after receipt or issuance of the termination notice, to each enrollee who received his or her primary care from, or was seen on a regular basis by, the terminated provider. (6) The State, its contracted representative, or the MCO, PIHP, PAHP, or PCCM must provide the following information to all enrollees: (i) Names, locations, telephone numbers of, and non-English languages spoken by current contracted providers in the enrollee's service area, including identification of providers that are not accepting new patients. For MCOs, PIHPs, and PAHPs this includes, at a minimum, information on primary care physicians, specialists, and hospitals. (ii) Any restrictions on the enrollee's freedom of choice among network providers. (iii) Enrollee rights and protections, as specified in §438.100. (iv) Information on grievance and fair hearing procedures, and for MCO and PIHP enrollees, the information specified in §438.10(g)(1), and for PAHP enrollees, the information specified in §438.10(h)(1). (v) The amount, duration, and scope of benefits available under the contract in sufficient detail to ensure that enrollees understand the benefits to which they are entitled. (vi) Procedures for obtaining benefits, including authorization requirements. (vii) The extent to which, and how, enrollees may obtain benefits, including family planning services, from out-of-network providers. (viii) The extent to which, and how, after-hours and emergency coverage are provided, including: (A) What constitutes emergency medical condition, emergency services, and poststabilization services, with reference to the definitions in §438.114(a). (B) The fact that prior authorization is not required for emergency services. (C) The process and procedures for obtaining emergency services, including use of the 911-telephone system or its local equivalent. (D) The locations of any emergency settings and other locations at which providers and hospitals furnish emergency services and poststabilization services covered under the contract. (E) The fact that, subject to the provisions of this section, the enrollee has a right to use any hospital or other setting for emergency care. (ix) The poststabilization care services rules set forth at §422.113(c) of this chapter. (x) Policy on referrals for specialty care and for other benefits not furnished by the enrollee's primary care provider. (xi) Cost sharing, if any. (xii) How and where to access any benefits that are available under the State plan but are not covered under the contract, including any cost sharing, and how transportation is provided. For a counseling or referral service that the MCO, PIHP, PAHP, or PCCM does not cover because of moral or religious objections, the MCO, PIHP, PAHP, or PCCM need not furnish information on how and where to obtain the service. The State must provide information on how and where to obtain the service. (g) Specific information requirements for enrollees of MCOs and PIHPs. In addition to the requirements in §438.10(f), the State, its contracted representative, or the MCO and PIHP must provide the following information to their enrollees: (1) Grievance, appeal, and fair hearing procedures and timeframes, as provided in §§438.400 through 438.424, in a State-developed or State-approved description, that must include the following: (i) For State fair hearing— (A) The right to hearing; (B) The method for obtaining a hearing; and (C) The rules that govern representation at the hearing. (ii) The right to file grievances and appeals. (iii) The requirements and timeframes for filing a grievance or appeal. (iv) The availability of assistance in the filing process. (v) The toll-free numbers that the enrollee can use to file a grievance or an appeal by phone. (vi) The fact that, when requested by the enrollee— (A) Benefits will continue if the enrollee files an appeal or a request for State fair hearing within the timeframes specified for filing; and (B) The enrollee may be required to pay the cost of services furnished while the appeal is pending, if the final decision is adverse to the enrollee. (vii) Any appeal rights that the State chooses to make available to providers to challenge the failure of the organization to cover a service. (2) Advance directives, as set forth in §438.6(i)(2). (3) Additional information that is available upon request, including the following: (i) Information on the structure and operation of the MCO or PIHP. (ii) Physician incentive plans as set forth in §438.6(h) of this chapter. (h) Specific information for PAHPs. The State, its contracted representative, or the PAHP must provide the following information to their enrollees: (1) The right to a State fair hearing, including the following: (i) The right to a hearing. (ii) The method for obtaining a hearing. (iii) The rules that govern representation. (2) Advance directives, as set forth in §438.6(i)(2), to the extent that the PAHP includes any of the providers listed in §489.102(a) of this chapter. (3) Upon request, physician incentive plans as set forth in §438.6(h). (i) Special rules: States with mandatory enrollment under State plan authority—(1) Basic rule. If the State plan provides for mandatory enrollment under §438.50, the State or its contracted representative must provide information on MCOs and PCCMs (as specified in paragraph (i)(3) of this section), either directly or through the MCO or PCCM. (2) When and how the information must be furnished. The information must be furnished as follows: (i) For potential enrollees, within the timeframe specified in §438.10(e)(1). (ii) For enrollees, annually and upon request. (iii) In a comparative, chart-like format. (3) Required information. Some of the information is the same as the information required for potential enrollees under paragraph (e) of this section and for enrollees under paragraph (f) of this section. However, all of the information in this paragraph is subject to the timeframe and format requirements of paragraph (i)(2) of this section, and includes the following for each contracting MCO or PCCM in the potential enrollees and enrollee's service area: (i) The MCO's or PCCM's service area. (ii) The benefits covered under the contract. (iii) Any cost sharing imposed by the MCO or PCCM. (iv) To the extent available, quality and performance indicators, including enrollee satisfaction. [67 FR 41095, June 14, 2002; 67 FR 65505, Oct. 25, 2002] (a) General rules. (1) An MCO, PIHP, or PAHP may not discriminate for the participation, reimbursement, or indemnification of any provider who is acting within the scope of his or her license or certification under applicable State law, solely on the basis of that license or certification. If an MCO, PIHP, or PAHP declines to include individual or groups of providers in its network, it must give the affected providers written notice of the reason for its decision. (2) In all contracts with health care professionals, an MCO, PIHP, or PAHP must comply with the requirements specified in §438.214. (b) Construction. Paragraph (a) of this section may not be construed to— (1) Require the MCO, PIHP, or PAHP to contract with providers beyond the number necessary to meet the needs of its enrollees; (2) Preclude the MCO, PIHP, or PAHP from using different reimbursement amounts for different specialties or for different practitioners in the same specialty; or (3) Preclude the MCO, PIHP, or PAHP from establishing measures that are designed to maintain quality of services and control costs and are consistent with its responsibilities to enrollees.
Title 42: Public Health
PART 438—MANAGED CARE
Subpart A—General Provisions
§ 438.1 Basis and scope.
§ 438.2 Definitions.
§ 438.6 Contract requirements.
§ 438.8 Provisions that apply to PIHPs and PAHPs.
§ 438.10 Information requirements.
§ 438.12 Provider discrimination prohibited.
