A senior Centers for Medicare & Medicaid Services (CMS) official stood behind the “80-20 rule” — which has drawn major pushback from the home-based care industry — during a congressional hearing Tuesday.
Last week, the “Ensuring Access to Medicaid Services” rule was finalized. The impetus behind the rule is to strengthen access to home- and community-based services (HCBS) for Medicaid beneficiaries.
The provision that has grabbed the most attention is the one that would require 80% of Medicaid payments for HCBS to be reserved for direct care workers’ wages.
During the hearing, House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-Wash.) was critical of the 80-20 rule.
“The Medicaid access rule’s so-called 80-20 policy will lead to home care agencies reducing the amount of care that they can provide,” she said.
Daniel Tsai – the deputy administrator and director of Center for Medicaid and CHIP services at CMS – defended the 80-20 provision, pointing to low wages in HCBS and the correlation to care quality, as he also did last week.
“Data shows that direct care workers typically earn low wages and receive limited benefits, contributing to a shortage of direct care workers and high rates of turnover in this workforce, which can limit access to and impact the quality of HCBS,” he wrote in his witness testimony. “By supporting and stabilizing the direct care workforce, this provision will result in better qualified employees, lower turnover, and a higher quality of care, improving access to quality care for Medicaid beneficiaries.”
CMS wants to ensure that this percentage of Medicaid payments are going to direct care workers instead of things like administrative overhead or profit.
Tsai noted that he thinks the policy falls in line with its efforts to establish appropriate oversight of states’ HCBS systems.
In his written testimony, Tsai also pointed to other aspects of the rule that he believes will improve access to care long-term.
“The Access Rule establishes a new strategy for oversight, monitoring, quality assurance and quality improvement for HCBS programs; strengthens person‑centered service planning and incident management systems in HCBS; and improves data collection regarding compensation to the direct care workforce,” he wrote. “The rule also provides key insight into access
challenges for HCBS by requiring states to report on waiting lists.”
Tsai also stated that CMS leaned on the responses they received from stakeholders across health care when making final policy decisions.
“We relied on this feedback to inform our final decisions on policies that ensure we strike the right balance of ensuring payments go to workers, while not disincentivizing training opportunities, and ensuring states have time to collect data and implement the policies effectively,” he wrote.
Ultimately, Tsai emphasized that CMS will continue its mission to enhance Medicaid.
“About 85 million people receive health coverage through Medicaid and CHIP,” he wrote. “While these programs have done immeasurable good for hardworking families across our country, there is still more to do to continue to support and strengthen these programs. We are committed to continuing to build and support a stronger Medicaid program by serving the public as a trusted partner and steward, advancing health equity, expanding coverage and improving health outcomes.”
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