Vol. 35 Iss. 22 - June 24, 2019

Chapter 130
Fast-Track Regulation

Title of Regulation: 12VAC30-130. Amount, Duration and Scope of Selected Services (amending 12VAC30-130-2000).

Statutory Authority: § 32.1-325 of the Code of Virginia; 42 USC § 1396 et seq.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: July 24, 2019.

Effective Date: August 8, 2019.

Agency Contact: Emily McClellan, Regulatory Supervisor, Policy Division, Department of Medical Assistance Services, 600 East Broad Street, Suite 1300, Richmond, VA 23219, telephone (804) 371-4300, FAX (804) 786-1680, or email

Basis: Section 32.1-325 of the Code of Virginia grants the Board of Medical Assistance Services the authority to administer and amend the State Plan for Medical Assistance and to promulgate regulations. Section 32.1-324 of the Code of Virginia authorizes the Director of the Department of Medical Assistance Services (DMAS) to administer and amend the State Plan for Medical Assistance and to promulgate regulations according to the board's requirements. The Medicaid authority as established by § 1902(a) of the Social Security Act (42 USC § 1396a) provides governing authority for payments for services.

Purpose: This regulatory revision is essential to protect the health, safety, and welfare of citizens in that it prevents rules that were originally designed for fee-for-service providers from applying to managed care organization (MCO) providers. To require providers to submit marketing materials and marketing plans to DMAS and the MCOs for approval would interfere with the oversight responsibilities of the MCO. It is essential that MCO providers remain in compliance with their MCO contract requirements, and amending this regulation ensures that providers will have one set of rules to follow so that Medicaid members and the public are provided with only appropriate marketing materials using appropriate marketing practices. MCOs are still required to comply with 42 CFR 438.104.

Rationale for Using Fast-Track Rulemaking Process: This regulatory action is being promulgated as a fast-track rulemaking action because it is expected to be noncontroversial. All community mental health (CMH) services are being carved in to MCOs, and providers will be complying with MCO contract requirements related to marketing practices. Revising this regulation will ensure that CMH providers have only one set of marketing rules to follow.

Substance: Community mental health rehabilitative services (CMHRS) were added to Commonwealth Coordinated Care Plus (CCC Plus) on January 1, 2018, and providers now contract with CCC Plus MCOs. CMHRS was added to Medallion 4.0 managed care plans beginning in August 2018. Each MCO has its own set of marketing rules, which is included in the contract that providers must sign in order to be enrolled with the MCO.

The marketing rules set forth in 12VAC30-130-2000 C 4 and E require CMH providers to submit their marketing materials to DMAS for approval prior to their use or dissemination. When a CMH provider enrolls with an MCO and contracts to follow the MCO marketing requirements, the submission to DMAS may create a conflict between the MCO oversight authority and DMAS rules. The revised DMAS rules would eliminate this possible conflict.

In order to establish consistent rules between the MCO and fee-for-service (FFS) requirements, DMAS has determined that the small number of providers that will only provide CMH services to members with a FFS benefit do not need to submit their marketing materials and plans to DMAS for prior approval. DMAS expects that there will be very few of these providers, as most will be contracted with the MCOs, and that the requirements in subdivisions C 1 through C 3 and in subsection D will operate effectively to prevent providers from conducting inappropriate marketing activities. FFS providers will continue to be required to adhere to FFS contracts, Medicaid policy, manuals, and regulations related to marketing, outreach, and publicity.

Issues: The primary advantages to the Commonwealth and the public from these regulatory changes are that the changes prevent overlap and duplication, as well as potential conflict between two sets of rules relating to marketing practices, which prevents confusion among Medicaid providers while maintaining one set of rules to ensure that providers conduct appropriate marketing efforts. There are no disadvantages to the Commonwealth or the public as a result of this regulatory action.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Board of Medical Assistance Services (Board) proposes to no longer require submittal of Community Mental Health (CMH) services marketing materials for review and approval to the Department of Medical Assistance Services (DMAS) prior to their use or dissemination.

Result of Analysis. The benefits likely exceed the costs for the proposed regulation.

Estimated Economic Impact. Currently, this regulation requires in essence that marketing and promotional materials related to CMH services: 1) comply with federal and state laws, 2) completely and accurately describe all information required for customers to make fully informed decisions, 3) be distributed only to service areas in the license, and 4) be submitted to DMAS for review and approval prior to their use or dissemination.

However, CMH services were added to Commonwealth Coordinated Care Plus (CCC Plus) on January 1, 2018, and providers now contract with CCC Plus Managed Care Organizations (MCOs). Also, CMH services were added to Medallion 4.0 managed care plans beginning in August, 2018.

The contracts between DMAS and the MCOs set out the marketing rules the MCO must comply with. Then each MCO provider must comply with the marketing rules included in the MCO contract. According to DMAS, MCOs require submission of marketing plans and must approve them before their providers may proceed with the campaign. Also, almost all CMH providers are now enrolled in a MCO network. Thus, under the current language they are required to comply with their MCO's marketing rules as well as this regulation and submit to and obtain approval from DMAS creating a double system of review. The Board proposes to no longer require submission and approval of marketing materials to and from DMAS (i.e., repeal of requirement #4). This change would also apply to a few fee-for-service only providers that do not have a contract with an MCO.

DMAS believes that the MCO contracts would ensure appropriate marketing practices for providers in an MCO network and the requirements #1 through #3 would ensure appropriate marketing practices for fee-for-service only providers.

The net impact of this proposed change is relieving all CMH providers from submitting their marketing and promotional materials to DMAS for approval and obtaining approval before commencing any marketing campaign. The review and approval have been performed by a contractor on behalf of DMAS. DMAS estimates that there were about 18 submissions of marketing materials for review and approval per month prior to shifting CMH services to CCC plus and Medallion 4. Since the shift, DMAS has not in practice required that it receive the marketing and promotional materials related to CMH services for providers in an MCO network. No longer requiring this submission of materials provides some staff time savings to MCO network providers and eliminates possible delays in commencement of their marketing campaign.

The reviews of fee-for-service only providers are still being performed. These are the providers that have no contract with any of the MCOs. The DMAS contractor has reviewed only two marketing materials from fee-for-service providers after the shift of CMH services to managed care. Therefore, small DMAS contractor staff time savings and provider staff time savings associated with submission review and approval of marketing materials from fee-for-service only providers are expected upon promulgation.

DMAS may also benefit from this change in the future as the reduced staff time from its contractor may lead to a reduction in the contract bid amount, or may allow DMAS to obtain other services at the same bid amount. Finally, this change would eliminate the possibility of a conflict or misinterpretation that could exist between two separate sets of rules relating to marketing practices.

Businesses and Entities Affected. The proposed change applies to all Medicaid CMH providers. As of March 10, 2018, there were 14,693 providers. Most of these providers are small businesses.

Localities Particularly Affected. The proposed regulation does not disproportionately affect particular localities.

Projected Impact on Employment. The impact on providers with an MCO contract has already been realized. Thus, no impact on those providers is expected upon promulgation. The impact on the few fee-for-service providers have not been realized yet, and those providers are expected to experience some staff time savings when this change is promulgated.

Effects on the Use and Value of Private Property. Similarly, a few fee-for-service only providers should see a small positive impact on their asset values as they can reduce their labor costs by a small amount when the proposed change becomes final.

Real Estate Development Costs. No impact on real estate development costs is expected.

Small Businesses:

Definition. Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

Costs and Other Effects. The proposed regulation does not impose costs on small businesses. The other effects on small businesses are the same as discussed.

Alternative Method that Minimizes Adverse Impact. The proposed regulation does not adversely affect small businesses.

Adverse Impacts:

Businesses. The proposed regulation does not adversely affect businesses.

Localities. The proposed regulation does not adversely affect localities.

Other Entities. The proposed regulation does not adversely affect other entities.

Agency's Response to Economic Impact Analysis: The agency has reviewed the economic impact analysis prepared by the Department of Planning and Budget regarding the regulations and raises no issues with this analysis.


The amendments remove the requirement that community mental health providers submit their Medicaid marketing plans and materials to the department for review.

Marketing of Provider Services

12VAC30-130-2000. Marketing requirements and restrictions.

A. Purpose. The purpose of these rules shall be to define how providers shall be permitted to market their services to potential Medicaid or FAMIS beneficiaries and individuals who may or may not be currently enrolled with the particular provider. This shall apply to providers of community mental health services (12VAC30-50-226) and Early and Periodic Screening, Diagnosis, and Treatment Program (EPSDT) community mental health services (12VAC30-50-130) with the exception of Part C services.

B. Definitions.

"Beneficiaries" means individuals of any age and their families who are using or who may use community mental health rehabilitative services.

"DMAS" means the Department of Medical Assistance Services.

"FAMIS" means Family Access to Medical Insurance Security.

"Marketing materials" means any material created to promote services through any media including, but not limited to, written materials, television, radio, websites, and social media.

"Provider" means an individual or organizational entity that is appropriately licensed as required and enrolled as a DMAS provider of community mental health and substance abuse services.

C. Requirements.

1. Marketing and promotional activities (including provider promotional activities) shall comply with all applicable federal and state laws.

2. Providers shall provide clearly written materials that completely and accurately describe the Medicaid or FAMIS behavioral health service or services offered, the beneficiary eligibility requirements to receive the service or services, applicable fees and other charges, and all other information required for beneficiaries and their families to make fully informed decisions about enrollment into the service or services offered by the provider that is marketing its services.

3. Providers shall distribute their marketing materials only in the service locations approved within the license issued by the Licensing Division of the Department of Behavioral Health and Developmental Services.

4. Providers shall receive DMAS approval of all marketing materials and all changes to prior-approved marketing materials prior to their use or dissemination. Providers shall receive the DMAS marketing plan approval before engaging in any marketing activity.

a. Within 30 calendar days of receipt of providers' submissions, DMAS shall review submitted individual marketing materials and services and either approve them or deny their use or direct that specified modifications be made.

b. Providers failing to implement DMAS' required changes, or those which use unapproved or disapproved materials, shall be subject to termination of the provider agreement pursuant to 12VAC30-130-2000 E.

D. Limits and prohibitions.

1. Providers shall not offer cash or noncash incentives to their enrolled or prospective members for the purposes of marketing, retaining beneficiaries within the providers' services, or rewarding behavior changes in compliance with goals and objectives stated in beneficiaries' individual service plans.

2. While engaging in marketing activities, providers shall not:

a. Engage in any marketing activities that could misrepresent the service or DMAS;

b. Assert or state that the beneficiary must enroll with the provider in order to prevent the loss of Medicaid or FAMIS benefits;

c. Conduct door-to-door, telephone, unsolicited school presentations, or other cold call marketing directed at potential or current beneficiaries;

d. Conduct any marketing activities or use marketing materials that are not specifically approved by DMAS;

e. Make home visits for direct or indirect marketing or enrollment activities except when specifically requested by the beneficiary or family;

f. Collect or use Medicaid or FAMIS confidential information or Medicaid or FAMIS protected health information (PHI), as that term is defined in Health Insurance Portability and Accountability Act of 1996 (HIPAA), that may be either provided by another entity or obtained by marketing provider, to identify and market services to prospective beneficiaries;

g. Violate the confidential information or confidentiality of PHI by sharing or selling or sharing lists of information about beneficiaries for any purposes other than the performance of the provider's obligations relative to its DMAS provider agreement;

h. Contact, after the effective date of disenrollment, beneficiaries who choose to disenroll from the provider except as may be specifically required by DMAS;

i. Conduct service assessment or enrollment activities at any marketing or community event; or

j. Assert or state (either orally or in writing) that the provider is endorsed either by the Centers for Medicare and Medicaid Services, DMAS, or any other federal or state governmental entities.

E. Termination. Providers that (i) conduct any marketing activity that is not specifically approved by DMAS, (ii) (i) violate any of the prohibitions in this section, or (iii) (ii) fail to meet requirements shall be subject to termination of their provider agreements for the services affected by the marketing plan/activity plan or activity. Providers whose contracts are terminated shall be afforded the right of appeal pursuant to the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

VA.R. Doc. No. R19-5450; Filed June 5, 2019, 11:16 a.m.