[Code of Federal Regulations]
[Title 42, Volume 3]
[Revised as of October 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR431.51]

[Page 25-26]
 
                         TITLE 42--PUBLIC HEALTH
 
  CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF 
                  HEALTH AND HUMAN SERVICES (CONTINUED)
 
PART 431_STATE ORGANIZATION AND GENERAL ADMINISTRATION--Table of Contents
 
              Subpart B_General Administrative Requirements
 
Sec. 431.51  Free choice of providers.

    (a) Statutory basis. This section is based on sections 1902(a)(23), 
1902(e)(2), and 1915(a) and (b) and 1932(a)(3) of the Act.
    (1) Section 1902(a)(23) of the Act provides that recipients may 
obtain services from any qualified Medicaid provider that undertakes to 
provide the services to them.
    (2) Section 1915(a) of the Act provides that a State shall not be 
found out of compliance with section 1902(a)(23) solely because it 
imposes certain specified allowable restrictions on freedom of choice.
    (3) Section 1915(b) of the Act authorizes waiver of the section 
1902(a)(23) freedom of choice of providers requirement in certain 
specified circumstances, but not with respect to providers of family 
planning services.
    (4) Section 1902(a)(23) of the Act provides that a recipient 
enrolled in a primary care case management system or Medicaid managed 
care organization (MCO) may not be denied freedom of choice of qualified 
providers of family planning services.
    (5) Section 1902(e)(2) of the Act provides that an enrollee who, 
while completing a minimum enrollment period, is deemed eligible only 
for services furnished by or through the MCO or PCCM, may, as an 
exception to the deemed limitation, seek family planning services from 
any qualified provider.
    (6) Section 1932(a) of the Act permits a State to restrict the 
freedom of choice required by section 1902(a)(23), under specified 
circumstances, for all services except family planning services.
    (b) State plan requirements. A State plan, except the plan for 
Puerto Rico, the Virgin Islands, or Guam, must provide as follows:
    (1) Except as provided under paragraph (c) of this section and part 
438 of this chapter, a recipient may obtain Medicaid services from any 
institution, agency, pharmacy, person, or organization that is--
    (i) Qualified to furnish the services; and
    (ii) Willing to furnish them to that particular recipient.

This includes an organization that furnishes, or arranges for the 
furnishing of, Medicaid services on a prepayment basis.
    (2) A recipient enrolled in a primary care case-management system, a 
Medicaid MCO, or other similar entity will not be restricted in freedom 
of choice of providers of family planning services.
    (c) Exceptions. Paragraph (b) of this section does not prohibit the 
agency from--
    (1) Establishing the fees it will pay providers for Medicaid 
services;
    (2) Setting reasonable standards relating to the qualifications of 
providers: or
    (3) Subject to paragraph (b)(2) of this section, restricting 
recipients' free choice of providers in accordance with one or more of 
the exceptions set forth in Sec. 431.54, or under a waiver as provided 
in Sec. 431.55.
    (d) Certification requirement. (1) Content of certification. If a 
State implements a project under one of the exceptions allowed under 
Sec. 431.54 (d), (e) or (f), it must certify to CMS that the statutory 
safeguards and requirements for an exception under section 1915(a) of 
the Act are met.
    (2) Timing of certification. (i) For an exception under Sec. 
431.54(d), the State may not institute the project until

[[Page 26]]

after it has submitted the certification and CMS has made the findings 
required under the Act, and so notified the State.
    (ii) For exceptions under Sec. 431.54 (e) or (f), the State must 
submit the certificate by the end of the quarter in which it implements 
the project.

[56 FR 8847, Mar. 1, 1991, as amended at 67 FR 41094, June 14, 2002]