AMGA Urges CMS to Assess Patient Access Impacts Before Finalizing Medicaid Payment Rule

Survey finds nearly 4 in 10 medical groups have already cut services amid Medicaid funding pressures

Alexandria, VA — AMGA today urged the Centers for Medicare & Medicaid Services (CMS) to more thoroughly evaluate how its proposed Medicaid State Directed Payments (SDP) rule will affect patient access to care before finalizing the policy.

CMS’ proposed rule on Medicaid Managed Care State Directed Payments (CMS-2449-P) would impose new limits on supplemental payment arrangements that many states and providers rely on to sustain Medicaid participation.

In comments on the proposed rule, AMGA warned CMS places too much weight on cost containment while giving too little consideration to the equally important statutory requirement that Medicaid payments be sufficient to preserve beneficiary access to care.

“CMS has a responsibility to ensure the long-term sustainability of the Medicaid program, but that cannot come at the expense of the patients the program is meant to serve,” said Jerry Penso, MD, MBA, AMGA president and CEO. “Before finalizing changes of this magnitude, CMS needs to not only understand, but also and account for, the real-world consequences for provider participation, network adequacy, and patient access.”

CMS’ proposed rule goes significantly further than Congress intended, expanding Medicare-based payment limits from the four service categories specified in statute to every state-directed payment arrangement nationwide. That expansion helps explain why CMS’ own savings estimate—roughly $510 billion in reduced federal Medicaid spending through 2035—is more than triple the Congressional Budget Office’s $149 billion projection for the law as written, raising real questions about whether the rule exceeds CMS’ statutory authority.

Survey Data Point to an Access Crisis Already Underway

AMGA’s comments cite findings from a recent member survey showing the pressures on Medicaid providers are not hypothetical:

• 38% of responding medical groups and health systems have already eliminated patient services because of Medicaid-related funding pressures, and 68% expect to eliminate additional services in the future absent mitigation.
• The services most frequently cut include primary and specialty medical care, pediatric services, maternity services, behavioral health/psychiatric care, and surgical services.
• 21% of organizations have already closed or restructured facilities due to Medicaid funding pressures, and 57% anticipate further closures or restructuring—with rural hospitals, specialty clinics, and urgent care centers most commonly affected.
• Half of responding organizations have already furloughed or laid off staff, renegotiated contracts, or made other administrative changes in response to Medicaid funding reductions, and 62% expect to take further action.

AMGA offered three central recommendations:

1. Incorporate access-to-care analyses. CMS should conduct a prospective assessment of how the proposed payment limits would affect provider participation, network adequacy, and beneficiary access before finalizing the rule, and should establish ongoing monitoring afterward.
2. Protect program integrity while enhancing high-value care. Rather than requiring burdensome after-the-fact reconciliation of value-based payments against the Medicare-based limit, CMS should rely on upfront actuarial certification, an approach already well suited to value-based arrangements and consistent with CMS’ existing oversight role.
3. Elongate the implementation timeline. AMGA urged CMS to adopt a substantially longer and more deliberate transition period, including hardship exceptions, revised phase-down methodology for grandfathered payments, and “offramps” that would allow states to pause implementation if they experience significant negative impacts, such as declining provider participation or network adequacy concerns.

AMGA also pointed to the 2015 U.S. Supreme Court decision in Armstrong v. Exceptional Child Center, Inc., which held that CMS bears sole responsibility for enforcing the Medicaid Act’s access requirements because no private right of action exists. AMGA argued this makes it especially important for CMS to build access monitoring directly into any final rule.

“Preserving access to care is not just good policy; it’s a statutory obligation,” Dr. Penso said. “We urge CMS to slow down, gather the evidence, and ensure that efforts to control costs don’t come at the expense of the patients who depend on Medicaid for their care.”

The letter can be found on the AMGA website.
 

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About AMGA
AMGA is a trade association leading the transformation of healthcare in America. Representing multispecialty medical groups and integrated systems of care, we advocate, educate, innovate, and empower our members to deliver the next level of high-performance health. AMGA is the national voice promoting awareness of our members’ recognized excellence in the delivery of coordinated, high-quality, high-value care. More than 175,000 physicians practice in our member organizations, delivering care to one in three Americans.