Medicaid State Plans
Medicaid is a joint program between the federal and state governments. Each state implements Medicaid differently and administers its own program, establishing its own eligibility standards and determining the type, amount, duration, and scope of services provided as well as setting the rate of payment for services. The Centers for Medicare & Medicaid Services (CMS) issues guidance and provides oversight at the federal level.
Each state's Medicaid agency is responsible for the operation of its Medicaid program in both health care and school settings. To address policy-making and the provision of technical assistance, collaboration between the state Medicaid agency and state education agency (SEA) is essential.
Information about state plans, amendments, and covered services is available on the CMS Medicaid website in the State Profile section.
Because each state establishes and administers its Medicaid program, there is considerable variation from state to state. A service must be specifically identified in the state's Medicaid plan, or be furnished under the Early, Periodic, Screening, Diagnosis, and Treatment (EPSDT) benefit, to make Medicaid payment permissible. For example, in order for Medicaid to reimburse for health services provided in public schools, the services must be included among those included in the state's Medicaid plan or be available under the EPSDT benefit. Federal legislation also permits states to cover optional services.
States regularly revise their Medicaid programs by submitting a state plan amendment (SPA) to CMS. Although federal Medicaid requirements are administered by CMS and can be of some assistance to providers, in order to determine specific state requirements, providers need to contact the state Medicaid agency. The state plan may also include different requirements for the provision of services in health care and school settings.
According to federal guidelines, services must meet reasonable standards of medical and dental practice and must be necessary to treat or ameliorate the condition identified. The amount, duration, and scope of services are not preset and can be limited based on medical necessity.
State regulations and standards differ greatly in other areas of Medicaid, including:
- provider requirements for Medicaid participation, credentialing, and supervision;
- documentation requirements for plan of care approval, criteria for services, authorization, and reimbursement justification;
- Medicaid audit process and penalties for errors;
- use of the Children's Health Insurance Program (CHIP)