Page 44

Pennsylvania Keystones of Health Section 1115 Demonstration Approval Period: December 26, 2024 through December 31, 2029 Page 31 of 90 i. For primary care and obstetric care services in Zuckerman, et al. 2021. "Medicaid Physician Fees Remained Substantially Below Fees Paid by Medicare in 2019." Health Affairs 40(2): 343–348 (Exhibit 3); AND ii. For behavioral health services (the category called, ‘Psychotherapy’ in Clemans-Cope, et al. 2022. "Medicaid Professional Fees for Treatment of Opioid Use Disorder Varied Widely Across States and Were Substantially Below Fees Paid by Medicare in 2021." Substance Abuse Treatment, Prevention, and Policy (2022) 17:49 (Table 3)); OR b. Provide to CMS for approval for any of the three services categories the average ratio, as well as the code sets, code level Medicaid utilization, Medicaid and Medicare rates, and other data used to calculate the ratio, and the methodology for the calculation of the ratio under this alternative approach as specified below: i. Service codes must be representative of each service category as defined in STC 7.4. ii. Medicaid and Medicare data must be from the same year and not older than 2019. iii. The state’s methodology for selecting the year of data, determining Medicaid code-level utilization, the service codes within the category, geographic rate differentials for Medicaid and/or Medicare services and their incorporation into the determination of the category average rate, the selection of the same or similar Medicare service codes for comparison, and the timeframes of data and how alignment is ensured should be comprehensively discussed in the methodology as provided to CMS for approval. 7.6. To establish the state’s ratio for each service category identified in STC 7.4 as it pertains to managed care plans’ provider payment rates in the state, the state must provide to CMS either: a. The average fee-for-service ratio as provided in STC 7.5(a), if the state and CMS determine it to be a reasonable and appropriate estimate of, or proxy for, the average provider rates paid by managed care plans (e.g., where managed care plans in the State pay providers based on state plan fee-for-service payment rate schedules); or b. The data and methodology for any or all of the service categories as provided in STC 7.5(b) using Medicaid managed care provider payment rate and utilization data. 7.7. In determining the ratios required under STC 7.5 and 7.6, the state may not incorporate FFS supplemental payments that the state made or plans through December 31, 2029, to make to providers, or Medicaid managed care pass-through payments in accordance with 42 CFR § 438.6(a) and 438.6(d). 7.8. If the state is required to increase provider payment rates for managed care plans per STC 7.2. and 7.6, the state must: