The Medicaid and CHIP Payment and Access Commission’s (MACPAC) has called for greater collection of wage data to inform home- and community-based services (HCBS) rate settings in two federal health programs, raising concerns among some stakeholders.

The commission’s recommendation would apply to Medicaid and the Children’s Health Insurance Program (CHIP). If implemented, it would require states to gather and report more data about the wages earned by HCBS workers to help establish payment rates. Patients are able to receive hospice and palliative care through both Medicaid and CHIP, depending on the state.

“States need timely and accurate base data to build and maintain rates. Wage data are a critical input to developing rates that promote an adequate workforce,” MACPAC indicated in a slide presentation. “There is no single data source that encompasses all Medicaid HCBS worker wages across states and HCBS programs.”

As of July 2024, nearly 80 million people were enrolled in Medicaid and CHIP combined, according to the U.S. Centers for Medicare & Medicaid Services (CMS).

Most states currently use wage data from the Bureau of Labor Statistics (BLS) in setting payment rates for those programs. Some also use cost indices, national survey data, or state-collected information or provider surveys, according to MACPAC. They also benchmark rates to state policies such as minimum wage laws or mandatory staffing ratios.

However, MACPAC contends that BLS wage data are not specific to or disaggregated by health care payer and do not include all Medicaid HCBS worker types, which include home health and personal care aides, licensed practical or vocational nurses, nursing assistants or occupational therapy aides or assistants.

States are already facing some new reporting requirements. CMS in 2024 finalized the Ensuring Access to Medicaid Services rule, which among other provisions mandated additional data collection related to HCBS rate setting.

Beginning in 2026, states must biannually publish average hourly fee-for-service HCBS rates for homemaker, home health aide, personal care and rehabilitation services. Beginning in 2028, states must report annually on the percentage of payments directed toward compensation for those same occupations. States are not required to publish these data publicly, and the access rule does not require states to report or publish average wage rates

According to MACPAC, these new data are insufficient.

“The access rule does not fill the existing wage data gaps, does not require states to report average wage rates and does not require wage data to be reported publicly, which would allow states to conduct a market comparison with other states,” MACPAC indicated.

The National Alliance for Care at Home has voiced “concern” over the MACPAC recommendation.

“Rather than seeking to address the root-cause of low worker wages, MACPAC’s recommendation instead focuses on collecting additional information that would further describe the issue,” the Alliance indicated in a statement. “This approach increases administrative burden on states and providers without actually proposing solutions to this problem.”

Further, the Alliance called on CMS to do the following:

• Perform comprehensive rate studies no less frequently than every five years that:
  • Use generally accepted accounting practices to develop a payment methodology that assures continued adequacy of each component of the rate model
  • Establish a rate model that includes individualized components for core provider cost drivers as well as a livable wage for workers
• Submit a copy of the rate review report and recommendations with any waiver renewal or state plan amendment and make the report publicly available on their website
• Require states to justify any variance between the report recommendations and the actual established payment rates

The Alliance also stated that CMS should be given the authority to disapprove rate methodologies that do not clearly account for all statutory and regulatory requirements of delivering services as well as demonstrating that the rates are sufficient to support a livable wage for workers.

“State administrations and state legislators must be held accountable to fund services at levels that enable improved wages for workers,” the Alliance said in the statement. “Sixty years of Medicaid program history have demonstrated that such wholesale changes to state actions are only achieved through new and strengthened Federal requirements. We urge MACPAC and its Commissioners to be bold and recommend structural changes to Federal Medicaid law and regulations that mandate payment policies ensuring access to HCBS through livable wages for direct care workers.”