"A.1. The Department of Medical Assistance Services (DMAS) as part of its mission shall ensure that vulnerable Virginians have access to quality health care services by operating a fiscally responsible and sustainable program.

2. The department shall take all necessary measures to ensure strong financial oversight and accountability to ensure the cost-effective use of all appropriated funding. The department shall not implement any policy or programmatic change to the Medicaid or children's health insurance programs without first performing a thorough assessment of potential costs to the Commonwealth.  Any policy or programmatic change with a fiscal impact shall not be implemented unless specifically authorized by the General Assembly through a general appropriation act or statutory requirement.
3. The department shall implement internal procedures to ensure that appropriate agency finance staff are performing continuous and detailed monitoring of medical assistance programs. Monitoring shall include, but not be limited to, fee-for-service claims and spending as well as managed care encounter data and spending. Further, DMAS shall put processes in place to ensure prompt notification to agency leadership and finance staff when any unexplained trends, anomalies, or discrepancies are detected.
4. The department shall ensure agency staff review capitation rates for the Commonwealth's Medicaid managed care programs as necessary to determine if the rates are cost-effective and in the best interest of the Commonwealth.
5. By October 15 of each year, DMAS shall include on its website a listing of Medicaid and children's health insurance program policy changes authorized by the General Assembly in the prior fiscal year. The listing shall include a description of the policy change, the authority for the change, and the estimated fiscal impact. The department shall track annual expenditures for any identified policy change for three fiscal years.

6. DMAS shall report by September 15, 2025, on the internal processes it has developed and implemented to comply with paragraphs A.1. through A.5. in this Item, to the Governor, Department of Planning and Budget and the Chairs of the House Appropriations and Senate Finance and Appropriations Committees.

B.1. The Department of Medical Assistance Services (DMAS) shall maintain a list of all programmatic and policy changes to the Medicaid and children's health insurance programs in a prominent location on the agency's website. Programmatic and policy changes shall include, but not be limited to, state plan amendments, amendments to federal waivers, federal waiver renewals, regulatory changes, guidance document changes, provider manual changes, provider memos, managed care contract changes, technical assistance manual changes, or any other communication of official policy proposed by DMAS. The list shall include a brief description of the change, the authority for the change, and an assessment of potential costs.

2. At least 30 days prior to the implementation of any change as identified in A.1. that may have a cost for which the agency does not have specific authorization from the General Assembly to implement, DMAS shall provide notification to the Director, Department of Planning and Budget, and the Chairs of the House Committee on Appropriations and the Senate Committee on Finance and Appropriations.

C. DMAS shall prepare a monthly budget variance report at the service level detail on the Medicaid and children's health insurance programs with an explanation of any variance between expenditures and budget. Such report shall be submitted to the Governor and the Chairs of the House Committee on Appropriations and the Senate Committee on Finance and Appropriations by the twentieth day of each month.

D. DMAS shall review fee for service claims and managed care encounter data on a monthly basis to determine unexplained trends that may have a significant and unplanned fiscal impact and report such trends to the Governor, the Director of the Department of Planning and Budget, and the Chairs and Staff Directors of the House Committee on Appropriations and the Senate Committee on Finance and Appropriations.

E. DMAS shall monitor the Medicaid and children's health insurance programs to ensure cost-effectiveness and control the increase of the cost of the Medicaid program in the delivery of health care services and develop strategies to achieve such cost-effectiveness and report on such strategies to the Governor and the General Assembly on an annual basis, by no later than September 1 of each year."