CMS proposes rules to increase healthcare access for key populations

Key Takeaways

Counties play a critical role in providing healthcare services, investing billions in health, behavioral health and crisis care infrastructure. Recent proposals from the Centers for Medicare & Medicaid Services (CMS) offer new opportunities to enhance healthcare access for those in crisis through proposed changes to Medicare policies.

On September 9, NACo submitted comments to CMS on two key areas: revisions to Medicare’s custody definition and Special Enrollment Period (SEP) for formerly incarcerated individuals, and updates to crisis stabilization unit (CSU) payment policies. 

Comments on revisions to Medicare’s “custody” definition and Special Enrollment Period

The proposed rule seeks to align Medicare more closely with Medicaid and Affordable Care Act (ACA) plans by narrowing the definition of “custody,” so it no longer includes individuals on bail, parole, probation or home detention. This change will expand access to coverage and care for older adults and people with disabilities living in the community under supervised release after incarceration. It will also simplify the process for stakeholders to connect individuals leaving incarceration to coverage by creating more consistency between Medicare, Medicaid and commercial health insurance policies.

NACo’s comments expressed strong support for CMS's proposed revisions to Medicare’s custody definition and the Special Enrollment Period (SEP) for formerly incarcerated individuals. These changes are crucial for improving healthcare access for individuals transitioning from incarceration. Specifically, NACo:

• Supports narrowing custody definition: NACo supports excluding individuals in partial confinement or under community supervision from the "custody" definition, enabling Medicare access for those transitioning back into the community.
• Encourages pre-release enrollment: NACo encourages allowing Medicare enrollment for eligible individuals before release, ensuring continuity of care, similar to Medicaid enrollment practices in some jails.
• Requests removal of “under arrest” from definition: NACo requests removing the term “under arrest” from the custody definition to prevent limiting Medicare access for individuals on bail or pre-trial release.
• Recommends dual enrollment coordination: NACo recommends CMS coordinate with Medicaid to streamline the dual enrollment process for individuals eligible for both Medicare and Medicaid upon release.

NACo advocates for these revisions to bridge gaps in coverage, particularly for those who qualify for Medicare but not Medicaid, ensuring a smoother transition and better health outcomes for individuals reentering the community.

Read NACo’s comments

Comments on Medicare Coverage for services provided by Crisis Stabilization Units

The second proposed rule addresses payment adjustments for medical services billed to Medicare, while also seeking feedback on how the program could cover services provided by crisis stabilization units, which are primarily operated by county governments.

NACo’s comments outlined the role that Crisis Stabilizations Units–small inpatient facilities designed to provide immediate care for individuals experiencing a mental health crisis—play in the local continuum of care.  In addition, NACo emphasized the benefits of Medicare care coverage for crisis stabilization unit services for counties, which include:

• Enhancing access to crisis services: Expanding Medicare billing guidance for Crisis Stabilization Units (CSUs) could significantly improve access to crisis services in underserved areas by addressing mental health workforce shortages.
• Mitigating rural-urban disparities: Both rural and urban Medicare beneficiaries experience similar rates of mental illness, but rural areas face greater challenges due to limited access to mental health specialists.
• Reducing workforce shortages: Major barriers to operating 24/7 CSUs statewide include workforce shortages. Approximately 570 counties lack mental health professionals, with shortages concentrated rural regions.
• Countering Medicare provider decline: Many psychiatrists and psychologists opt out of Medicare due to low payment rates and administrative hurdles, further reducing care access in rural areas.
• Attracting clinicians: Expanding Medicare access to in-network specialty mental health providers in CSUs could attract more clinicians, improving the mental health workforce and expanding care in underserved regions.

Read NACo’s comments

Impact on counties

The proposed changes have significant implications for counties, which play a pivotal role in local health and justice systems. Counties invest billions annually in community health, crisis services and justice systems, often operating critical facilities like CSUs. Specifically, these proposed rules could:

• Improve access to coverage for residents: The proposed changes to Medicare's definition of "custody" and Special Enrollment Period (SEP) for formerly incarcerated individuals will help counties connect residents reentering the community to critical health coverage, reducing uncompensated care costs for local health systems.
• Alleviate county workforce and service strain: Expanding access to Medicare billing for Crisis Stabilization Units (CSUs) could alleviate workforce shortages in county-run mental health facilities, improving counties' ability to meet the growing demand for crisis services, especially in underserved rural areas.
• Enhance reentry support: By aligning Medicare policy with Medicaid and other insurance programs, counties will see better coordination of care for justice-involved individuals, leading to more successful community reintegration and lower recidivism rates.

NACo remains committed to working with CMS and other federal partners to implement policies that improve healthcare access for justice-impacted individuals and strengthen county-operated services. The proposed changes to Medicare’s custody definition, SEP and payment policies for CSUs represent key opportunities to bridge gaps in care, attract a stronger workforce and enhance outcomes for at-risk residents. By aligning Medicare and Medicaid policies, counties can continue to provide high-quality, coordinated care in their communities.