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Regulation Review committee approves DSS maternity alternative‑payment rule after extended questioning from members
Summary
The Legislative Regulation Review Committee voted to approve Department of Social Services regulation 2024‑027a establishing an alternative payment (maternity bundle) methodology after members pressed agency officials on provider outreach, reimbursement rates and monitoring mechanisms.
The Legislative Regulation Review Committee on Aug. 26 approved regulation 2024‑027a from the Department of Social Services (DSS) to implement alternative payment methodologies for maternity care, including a bundled payment episode. The committee voted to accept the Legislative Commissioners’ Office recommendation of approval in whole with technical corrections.
Committee members spent the bulk of the meeting questioning DSS officials about provider outreach, how the maternity episode is defined and how payments and quality will be measured. Fatima Williams, identified in the meeting as deputy Medicaid director and coauthor of the bundle, told the committee that the agency worked with providers and an actuarial firm to analyze historical utilization and to define what is included and excluded from the maternity episode. “We worked with providers very closely right from the beginning of this bundle development,” Williams said.
Members repeatedly asked whether the payment levels would leave providers financially whole. Nina Holmes of DSS said recent legislative funding for rate increases is under analysis and that the department will provide more detail once that analysis is complete. “There was some money allocated and set aside for rate increases. The department is still actually in that analysis stage to figure out how far and where these increases can be allocated,” Holmes said.
The regulation establishes a payment model that blends routine prenatal services and certain supports (DSS said it added dollars for doula and lactation services). The agency described a monitoring and adjustment process that includes: monthly and one‑on‑one provider forums, the use of ten quality measures (five tied to pay‑for‑performance and five reporting measures), opportunities for providers to earn shared savings, desk reviews of shared‑savings calculations, and a retrospective reconciliation after deliveries to assess total cost of care and address underpayments.
Several members expressed cautious support but asked for continued oversight. Senator Kissel, who said he reviewed the regulation with committee counsel, described the approach as a “holistic” shift aimed at improving outcomes and said, “The proof will be in the pudding.” Senator Austin and Representative Carpino said they remained concerned about whether the new methodology will produce adequate reimbursement in practice and requested follow‑up review if providers begin to report losses or reduce services.
Agency officials told members there have been multiple provider meetings dating back to 2024 and that DSS and its contractors — including an actuarial firm and the state’s medical ASO — are available for individual practice consultations. Williams said providers had access to case‑rate reviews and that the program began implementation in January; preliminary eight‑month data, she said, did not show a clear adverse financial trend for participating practices.
Votes at a glance
- Proposed regulation 2024‑027a (Department of Social Services): Motion to accept the LCO recommendation of approval in whole with technical corrections. Moved by Senator Kissel; seconded by Representative Godfrey. Vote: 14 yes, 0 no, 0 abstain (approved).
- Proposed regulation 2025‑023 (Department of Consumer Protection — home inspector intern requirements): Motion to accept the LCO recommendation of approval in whole with technical corrections. Vote: 14 yes, 0 no, 0 abstain (approved).
- Proposed regulation 2025‑024 (Department of Consumer Protection — automatic fire sprinkler layout technician licensing fees): Motion to accept the LCO recommendation of approval in whole with technical corrections. Vote: 14 yes, 0 no, 0 abstain (approved).
Why it matters: The committee’s approval moves DSS’s alternative payment approach into place under the Uniform Administrative Procedures Act process. Committee members flagged the risk that payment changes could affect provider participation and access to maternity services; the department described built‑in reconciliation and monitoring tools and said it will return data and analysis to lawmakers as available.
The committee recorded multiple requests that DSS provide timely follow‑up to the legislature and to providers if retrospective reconciliation or early data show provider losses or service reductions. Members also asked that the department continue outreach and make its rate‑analysis results available when complete.
The regulation passed on a voice and roll‑call sequence that recorded affirmative votes from Representative Carpino; Senator Gagkar (spelled in the transcript as "Gadkar") Wilcox; Senator Kissel; Representative Whitelander; Representative Biggins; Senator Ciccarella; Representative Fishbein; Representative Godfrey; Senator Hartley; Representative Claire DiStefria; Representative McGourty; Senator Austin; Representative Ryan; and Senator Summers.
