Medicaid Managed Care Plan Stopped Paying for the Nursing Home?

If a Medicaid managed care plan stopped paying for your mother's nursing home stay, the first deadline to watch is the one for keeping her coverage running while she appeals. Federal rules give her 60 calendar days from the date on the plan's notice to appeal to the plan, but continued coverage has to be requested by the later of 10 calendar days after the plan sends its notice or the date the plan's decision takes effect. If the nursing home has also sent a discharge notice, that's a second decision with its own appeal and its own deadline.1,2,3

This guide is for a resident whose Medicaid already pays through a managed care plan. When a state delivers long-term care that way, it's called managed long-term services and supports (MLTSS), which the Centers for Medicare & Medicaid Services (CMS) describes as long-term services and supports delivered through capitated Medicaid managed care programs. If her Medicaid application is still pending or was denied, start with our guide to nursing home discharge while Medicaid is pending instead. For every federal discharge rule in one place, see our hub on nursing home discharge rights.5

In This Guide

• Which Notice Do You Have?
• The Coverage Appeal and the Discharge Appeal, Side by Side
• How to Appeal When a Medicaid Managed Care Plan Stops Paying for the Nursing Home
• If the State Medicaid Agency Ended Coverage Instead
• If the Nursing Home Sends a Discharge Notice
• If She Has an Integrated D-SNP
• What to Do This Week When the Medicaid Plan Stopped Paying for the Nursing Home
• Frequently Asked Questions
• Learn More

Which Notice Do You Have?

When two envelopes arrive in the same week, it's natural to treat them as one emergency. Sorting the paper first keeps you from sending an appeal to the wrong place, because each notice points to a different appeal.

• A notice from her managed care plan. The plan's written notice of an "adverse benefit determination" must explain what the plan decided and why, her appeal rights, and her right to keep benefits during the appeal. Follow the coverage appeal below.6
• A notice from the state Medicaid agency. If the state agency itself ended her coverage, federal rules require the agency to offer a hearing to anyone who believes it acted in error. Skip to the section on the state agency.3
• A notice from the nursing home. A written transfer or discharge notice from the facility is the discharge decision. The notice must state her appeal rights and name the entity that receives appeal requests. Follow the discharge appeal below.4
• A notice from a plan that covers both Medicare and Medicaid. An integrated dual eligible special needs plan (D-SNP) for people with both Medicare and Medicaid can use its own unified appeal process. See the D-SNP section.1

The Coverage Appeal and the Discharge Appeal, Side by Side

The two appeals can run at the same time, on different clocks, in front of different decision-makers. The coverage side follows the federal managed care rules in 42 CFR part 438, and the discharge side follows 42 CFR 483.15.1,2,6,4,7

How to Appeal When a Medicaid Managed Care Plan Stops Paying for the Nursing Home

A plan letter can read like the final word. It isn't. Federal managed care rules set out a path, and the order you take the steps in decides whether her coverage keeps running while you argue.

Start With the Plan's Notice

Under 42 CFR 438.404, a Medicaid managed care plan must give its decision in writing. The notice must also tell her she can get, free of charge and on request, copies of the documents, records and other information behind the decision, including the medical-necessity criteria the plan used. Ask for those in writing; they're what you'll argue against. If the plan says she no longer meets nursing home level of care, our guide to nursing home level of care by state shows how her state decides it.6

When a plan ends services it had already authorized, federal timing rules call for notice at least 10 days before the action, as the Medicaid and CHIP Payment and Access Commission (MACPAC) summarizes them. The same rules allow notice as late as the date of action in listed situations, including when the beneficiary's physician prescribes a change in the level of medical care, so a Medicaid notice with fewer than 10 days' warning isn't automatically defective.6

Ask to Keep Her Coverage Running

This is the step that keeps her nursing home coverage in place while you fight, and its window is short. Under 42 CFR 438.420, a Medicaid managed care plan must continue the enrollee's benefits during the plan appeal if all five of these are true:

• She filed the plan appeal on time.
• The appeal involves ending, suspending or reducing services the plan had already authorized.
• An authorized provider ordered the services.
• The period covered by the original authorization hasn't expired.
• She filed for continued benefits on time, meaning on or before the later of 10 calendar days after the plan sends its notice or the intended effective date of its decision.2

Continued coverage carries a real risk. If the final decision upholds the plan, the plan may recover the cost of care it provided only because of the continuation rule, consistent with the state's usual recovery policy and the plan's contract. The plan's notice must explain when she could be required to pay those costs, so read that paragraph slowly, and ask the plan to explain it in writing if it's unclear.2,6

One detail matters if the nursing home's staff offer to handle the appeal: a provider may file an appeal on her behalf with her written consent, where state law permits, but a provider can't request continued benefits. The continuation request should come from her or her authorized representative.1

File the Plan Appeal Within 60 Days

Under 42 CFR 438.402, each Medicaid managed care plan may have only one level of appeal, and an enrollee has 60 calendar days from the date on the plan's notice to file it. She can appeal orally or in writing. If you call, follow up in writing and keep a copy.1

The plan then has to decide. Under 42 CFR 438.408, the state sets the plan's deadline, and federal rules cap it at 30 calendar days from the day the plan receives a standard appeal and 72 hours for an expedited one. Both the standard and the expedited deadline for a Medicaid managed care plan's appeal decision can be extended by up to 14 calendar days if the enrollee asks, or if the plan shows the state that it needs more information and that the delay is in her interest.2

Ask for a Fast Appeal if Waiting Could Harm Her

Under 42 CFR 438.410, every Medicaid managed care plan must keep an expedited appeal process. A fast appeal applies when the plan decides, on her request, or her provider indicates, that the standard timeframe could seriously jeopardize her life, physical or mental health, or ability to attain, maintain or regain maximum function.8

Ask her doctor to make the request or to back yours. The plan must make sure no punitive action is taken against a provider who requests a fast appeal or supports her appeal. And if the plan turns down the request to expedite, the appeal doesn't end: it moves to the standard timeframe of no more than 30 calendar days, with a possible 14-day extension.8

If the Plan Says No: The State Fair Hearing

A plan member can ask for a state fair hearing only after the plan's notice that it's upholding its decision. From the date of a Medicaid managed care plan's notice upholding its decision, federal rules give the enrollee no less than 90 and no more than 120 calendar days to request a state fair hearing; each state picks the exact number within that range.2

The coverage clock is much shorter. Medicaid managed care benefits continued during the plan appeal end if she doesn't request a state fair hearing and continued benefits within 10 calendar days after the plan sends its adverse decision. A family that takes the full filing window keeps the right to a hearing but loses the continued coverage in the meantime.2

One more rule works in her favor. If the plan doesn't follow the federal notice and timing requirements in 42 CFR 438.408, such as its deadline to decide, she's treated as having finished the plan's appeal process and can go straight to a state fair hearing. For how a hearing itself works, see our guide to Medicaid appeals and fair hearings.2

If the State Medicaid Agency Ended Coverage Instead

Not every resident's Medicaid runs through a plan. When the notice comes from the state Medicaid agency itself, she asks the agency for a fair hearing, and different federal rules decide whether her coverage continues.3

• Before the date of action. Under 42 CFR 431.230, if the agency sent the required advance notice and she requests a hearing before the date of action, the agency may not end or reduce services until a hearing decision. A narrow exception applies only when the hearing finds the sole issue is federal or state law or policy and the agency promptly says so in writing.9
• Within 10 days after the date of action. The agency may reinstate services if she requests a hearing no more than 10 days after the date of action.9
• No advance notice when the rules required it. The agency must reinstate services if it acted without the advance notice the rules required, she requests a hearing within 10 days of receiving the notice of action (presumed to be 5 days after the date on it), and the agency determines the action turned on something other than applying federal or state law or policy. If the notice was allowed to arrive on the date of action, for example because her physician prescribed a change in her level of care, don't count on this route. She can still request a hearing within 10 days after the date of action, where reinstatement is the agency's choice.9

When the state Medicaid agency itself takes the action, the window to request a Medicaid fair hearing is set by the state, and federal rules cap it at 90 days from the date the agency mails its notice; a state may set a shorter one, so go by the date on her notice. If the agency's action is upheld, it may recover the cost of services furnished only because of the continuation rule. Our guide to keeping Medicaid coverage during an appeal walks through this in more detail.10,9

If the Nursing Home Sends a Discharge Notice

A discharge notice on top of a coverage fight can feel like the floor giving way. Federal rules put real limits on the home, and those limits don't depend on who's paying: a facility must keep identical transfer and discharge policies for all residents regardless of payment source.11

A coverage appeal and a discharge appeal are separate. Each is its own ground for a state fair hearing under its own provision, so if you've received both notices, file both appeals.3

The Six Reasons a Nursing Home Can Discharge

Under 42 CFR 483.15, a nursing home must let a resident stay and may transfer or discharge her only if:

1. The move is necessary for her welfare and her needs can't be met in the facility.
2. Her health has improved enough that she no longer needs the facility's services.
3. The safety of individuals in the facility is endangered because of her clinical or behavioral status.
4. The health of individuals in the facility would otherwise be endangered.
5. She has failed, after reasonable and appropriate notice, to pay for (or to have paid under Medicare or Medicaid) her stay.
6. The facility stops operating.4

Read that list with her plan letter beside it. A managed care plan's coverage decision isn't one of the six reasons on its own; if the home is relying on it, the notice has to fit one of them, and the closest fit is nonpayment.4

The nonpayment reason has limits written into it. Under 42 CFR 483.15, nonpayment applies if the resident doesn't submit the paperwork needed for third-party payment, or after the third party, including Medicare or Medicaid, denies the claim and the resident refuses to pay.4

If the home's notice says her health has improved enough that she no longer needs its services, federal rules require the move to be documented in her medical record, and that documentation must be made by her own physician.4

What the Discharge Notice Must Say

Lay the notice on the table and check it against what federal rules require. Anything missing or wrong is worth raising in the appeal and with the ombudsman.

• Did it reach both of you, in writing? The home must give written notice to her and to you as her representative, in a language and manner you understand, and send a copy to the Office of the State Long-Term Care Ombudsman.4
• Does it give her 30 days? Notice must come at least 30 days before the move. It can come sooner only in listed situations, such as when she has lived there less than 30 days or her urgent medical needs require an immediate move.4
• Does it name where she's going, and could she be safe there? The notice must state the location. CMS's surveyor guidance says discharge planning must make sure that destination meets her health and safety needs and her preferences, and tells surveyors to look at whether the home considered whether a family caregiver can actually give the care she'll need.4
• Does it tell you where to appeal? It must name the entity that receives appeals, with its mailing and email address and phone number, and explain how to get an appeal form and help completing it.4

Appealing the Discharge Stops the Move

Once she appeals, the nursing home may not transfer or discharge her while the appeal is pending, unless failing to discharge her would endanger the health or safety of her or other people in the facility, and the facility must document that danger. If she's in the hospital and the home won't take her back, read our guide on a nursing home refusing to readmit.4

Who hears the appeal and how long she has to file depend on her state. A November 2021 report by the HHS Office of Inspector General (OIG) found the hearing entity varies by state (for example, the State Medicaid Office or an Office of Administrative Hearings) and the filing deadline varies too, though CMS requires that it not exceed 90 days. Ask the entity named on the notice for the deadline.7

If she wins, 42 CFR 431.246 requires the state Medicaid agency to promptly make corrective payments, retroactive to the date the incorrect action was taken, and, if appropriate, to provide for her readmission. After a favorable ruling, she or her representative can also report the discharge as a complaint to the State Survey Agency, which must triage it and conduct a survey.12

If She Has an Integrated D-SNP

What to Do This Week When the Medicaid Plan Stopped Paying for the Nursing Home

You don't have to fix everything today. Work through these in order, and write down every date as you go.

Learn More

Find personalized help sorting her plan and discharge notices and lining up both appeal deadlines at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.