DHHS Releases MaineCare Rate System Evaluation Interim Report 

Jan 21, 2021

Part of a transparent and data-driven review of how MaineCare pays for health services for 300,000 members  

The Maine Department of Health and Human Services (DHHS) today  is making available  the interim report (PDF) of its Comprehensive Rate System Evaluation, part of an effort to better understand and rationalize MaineCare reimbursement rates in the coming years to support members’ access to high-value health care. 

More than 330,000 Maine residents currently rely on MaineCare, Maine’s Medicaid program, to cover visits to their health care providers, obtain needed prescriptions, and receive services vital to their wellbeing. DHHS is undertaking a comprehensive evaluation of how MaineCare sets payment rates to health providers for these services.  

As part of that comprehensive evaluation, the Department sought this report to help inform the development of a process to set MaineCare payment rates in ways that promote access, equity, and quality health care for Maine people. The report released today makes a number of interim recommendations for how MaineCare can establish and maintain reimbursement rates that promote members’ access to high-quality care and accurately account for Maine health care providers’ costs. The Department is reviewing these interim recommendations and looks forward to reviewing the forthcoming implementation plan for these significant proposed changes.  

The Department adjusted the timeline of this project as a result of the coronavirus pandemic. Because of this delay, as well as the pandemic’s impact on the economy, the Department is not proposing any of these recommendations for inclusion in the Fiscal Years 2022-2023 biennial budget. Following review, the Department will determine which recommendations to adopt and develop an implementation plan that aligns with broader priorities, initiatives in the biennial budget, and budget resources.  

DHHS initiated the rate system evaluation in 2020. By design, the report compares MaineCare rates to Medicare, commercial, and certain other states’ Medicaid rates. This data-driven effort is informed by feedback collected during the fall from MaineCare members, providers, and other stakeholders. This included hosting multiple listening sessions for MaineCare members about their access to services, a series of meetings with providers attended by 270 health and social services organizations, and gathering written comments. 

“We appreciate the thoughtful process DHHS has undertaken to evaluate MaineCare’s rate system so policymakers can make decisions about reimbursement levels that are based on data and the real experiences of MaineCare members and providers,” said Robyn Merrill, Executive Director of Maine Equal Justice. “The Department has approached this task with an openness to feedback from members, providers, and advocates and their transparency throughout the process has created meaningful opportunities for a variety of stakeholders to engage.” 

“The process that MaineCare has taken to evaluate provider reimbursement rates is unprecedented,” said Ann Woloson, Executive Director of Consumers for Affordable Health Care. “It includes providing opportunities for people with MaineCare coverage to weigh in on their experience accessing services and how those experiences may possibly be tied to rates. This shows that DHHS is serious about understanding how resources affect capacity, provider recruitment and infrastructure, and, ultimately, access to quality and equitable care for everyone in Maine.”  

DHHS contracted with Myers and Stauffer, a national accounting firm, to conduct this evaluation. The firm first produced a benchmarking report that cataloged MaineCare rates and compared them to rates for similar services paid by comparison state Medicaid agencies, Medicare, and commercial payers. The benchmarking report, released in November, identified areas where MaineCare rates are higher, lower, and in line with other payers. Its purpose was to identify services where rate adjustments may be needed, and other services that require more analysis to ensure rates are appropriate.  

The benchmarking report contributed important analysis that informed the interim report released today. Myers and Stauffer makes recommendations in this interim report about how DHHS should update and maintain MaineCare’s various rate methodologies and prioritize services for rate adjustments and studies over a five-year period.  

MaineCare reimburses health providers for care and treatment they provide to MaineCare members. This includes a wide range of providers, from hospitals and primary care clinics to therapists, behavioral health and substance use disorder treatment facilities, and nursing facilities, among many others.  

The rate system evaluation includes all MaineCare services with the exception of Pharmacy and Non-Emergency Transportation, the rates for which are subject to separate federal requirements. 

Myers and Stauffer recommends that DHHS adopt a consistent and rational basis for updating rates and review and update methodologies on a regular schedule. They also recommend other adjustments to progress toward the Department’s goal to transition at least 40% of MaineCare payments to value-based Alternative Payment Models, which incentivize high-value care, by the end of 2022. 

Myers and Stauffer recommends, for example, that DHHS set rates for a range of services (Physical, Occupational, and Speech Therapies; and Chiropractic, Vision, Podiatric, Certified Registered Nurse Anesthetist Services and most Physician Services) at a consistent percentage of 2020 Medicare rates and update dental rates to more closely align with  median commercial rates. 

Some of the costs associated with these proposed changes could be partially offset by decreases to other services where MaineCare’s reimbursement is high in comparison to Medicare and other state Medicaid programs. Myers and Stauffer recommends that the Department prioritize some services that would result in a net reduction in rates, such as Durable Medical Equipment and Hospice services, for which MaineCare payments currently exceed Medicare rates.    

While comparisons to other payers are useful, Myers and Stauffer states that the Department must conduct additional analysis to account for Maine’s unique health care needs and economic factors in setting rates for services that often vary across states in terms of model and populations served. Myers and Stauffer recommends prioritizing community-based behavioral health services for further rate study. 

A final report will be issued at the end of February that may include refinements to some individual recommendations and will include a more detailed implementation plan.  

More information on this evaluation can be found on MaineCare’s Comprehensive Rate Setting Evaluation webpage.