Title of Regulation: 12VAC30-120. Waivered Services (amending 12VAC30-120-360, 12VAC30-120-370, 12VAC30-120-380).

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

Effective Dates: December 30, 2009, through June 29, 2010.

Pursuant to § 2.2-4011 of the Code of Virginia, the Department of Medical Assistance Services (DMAS) requested an extension of the above-referenced emergency regulation to complete the requirements of the Administrative Process Act. The emergency regulations were published in 26:10 VA.R. 1411-1417 January 18, 2010 (http://register.dls.virginia.gov/vol26/iss10/v26i10.pdf).

The emergency regulation was implemented on December 30, 2009, and the Notice of Intended Regulatory Action comment period ended March 3, 2010. The proposed regulation was submitted to the Secretary's office August 17, 2010, where it has been awaiting approval.

Federal law requires that recipients be allowed to choose between the various managed care organizations (MCOs) or managed care programs that operate in their locality. If a locality has only one MCO option and that locality meets the federal designation as "rural," then a "rural exception" option may be requested. The "rural exception" option requires managed care-eligible recipients in these specified localities to enroll with the one available MCO. Because the "rural exception" limits recipients' ability to choose, federal permission is required to implement the "rural exception" option.

The emergency regulation provides authority to DMAS to operate the "rural exception" option in localities that meet this requirement. Promulgation of this regulation will bring the Virginia Administrative Code into compliance with the federal Centers for Medicare and Medicaid Services-approved 1915(b) Managed Care Waiver, which was amended October 1, 2009, to include the "rural exception" option. If the emergency regulation lapses on December 29, 2010, DMAS will have no state authority to continue to limit recipients to the one MCO in their locality of residence.

Because of the time required by the remaining regulatory steps, it is not possible for the permanent rulemaking to be completed prior to the expiration of the current emergency regulations. For this reason DMAS is requesting an extension of six months in order to complete the necessary changes while maintaining the authority to continue to provide these MCO rural exception services and maintaining the integrity of the changes made in the emergency action.

The Governor approved the department's request to extend the expiration date of the emergency regulation for six months as provided for in § 2.2-4011 D of the Code of Virginia. Therefore, the regulations will continue in effect through June 29, 2011.

Agency Contact: Brian McCormick, Regulatory Supervisor, Department of Medical Assistance Services, 600 East Broad Street, Suite 1300, Richmond, VA 23219, telephone (804) 371-8856, FAX (804) 786-1680, or email brian.mccormick@dmas.virginia.gov.