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Statutory and Regulatory History of Special Needs Plans

The Medicare Modernization Act of 2003 (MMA) established an MA Coordinate Care Plan (CCP) specifically designed to provide targeted care to individuals with special needs.

In the MMA, Congress identified “special needs individuals” as institutionalized individuals, dual eligibles and/or individuals with severe or disabling chronic conditions, as specified by CMS. MA Coordinate Care Plans established to provide services to these special needs individuals are called “Specialized MA plans for Special Needs Individuals,” or SNPs. Special needs individuals and specialized MA plans for special needs individuals are defined in 42 CFR 422.2.  SNPs were first offered in 2006.  The MMA gave the SNP program the authority to operate until December 31, 2008.

The Medicare, Medicaid, and State Children’s Health Insurance Program (SCHIP) Extension Act of 2007 subsequently extended the SNP program from December 31, 2008, to December 31, 2009, but imposed a moratorium that prohibited CMS from approving new SNPs after January 1, 2008.  Accordingly, CMS did not accept SNP applications in 2008 for contract year (CY) 2009.

The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) lifted the Medicare, Medicaid, and SCHIP Extension Act of 2007 moratorium on approving new SNPs. MIPPA further extended the SNP program through December 31, 2010, thereby allowing CMS to accept MA applications for new SNPs and SNP service area expansions until CY 2010.  CMS accepted SNP applications from MA applicants for creating new SNPs and expanding existing CMS-approved SNPs for all three types of specialized SNPs in accordance with additional SNP program requirements specified in MIPPA.  CMS regulations that implement and further detail MIPPA application requirements for SNPs are located at 42 CFR 422.501-504.


State Medicaid Agency Contract (SMAC)

Once approved by CMS and the Department of Insurance, a Special Needs Plan must enter into a State Medicaid Agency Contract (SMAC) also known as a Memorandum of Agreement with the South Carolina Department of Health and Human Services (SCDHHS). 

SCDHHS maintains the authority to include state-specific reporting elements in conjunction with the CMS requirements as outlined in the Model of Care . The state-specific requirements are outlined in the CY 2023 SMAC .