Medicare Advantage, Part D Updates to Shift Control to Health Plans
A new proposed rule from CMS would offer health plans more control to determine Medicare Advantage and Part D benefits.
Source: Thinkstock
By - CMS is proposing regulatory changes that would offer health plans additional flexibility to design and implement Medicare Advantage (MA) and Part D Medicare benefits.
The rule would reduce administrative burdens by allowing plans to communicate with beneficiaries electronically. The proposals would also remove health plan requirements to send duplicate administrative information to CMS and lessen marketing restrictions on payers offering these plans.
Health plans would be allowed to increase out-of-pocket spending limits for MA beneficiaries, provide generic drugs and cheaper biosimilars in Part D plans, and adjust cost-sharing and deductible amounts based on medical criteria.
Marilyn Tavenner, President and CEO of AHIP, believes that the rule would help payers continue to provide high-quality health plans to Medicare beneficiaries.
“These recommendations reflect a strong commitment to improving the patient experience, increasing flexibility and choice, and reducing regulation and red tape,” Tavenner said. “These improvements would help health plans better serve the almost 19 million Medicare Advantage beneficiaries and more than 43 million Americans who rely on Part D.”
“We commend CMS’ leadership and staff for their responsiveness to stakeholder input, and for their hard work on behalf of everyone Medicare serves. AHIP will offer detailed feedback during the formal comment period. We appreciate CMS’ commitment to working together to improve care, outcomes, and costs for our nation’s seniors and those with disabilities.”
Additional policy changes are aimed at reducing unnecessary administrative regulations, improving MA enrollment practices, and strengthening Part D programs and prescription drug cost effectiveness.
Paperwork reductions and Quality Improvement Project removal
The proposed rule would reduce the need for health plans to submit medical-loss ratio (MLR) data and lower penalties for MA and Part D plans that don’t submit data.
MA organizations and Part D plans would only have to report the MLR percentage and amount of remittances owed to CMS for each MA or Part D contract. CMS is also proposing to revise MLR calculations to include fraud prevention, detection, and recovery expenses, as well as medication therapy management programs.
The rule also aims to remove the Quality Improvement Project (QIP) from Quality Improvement (QI) requirements for MA organizations. CMS believes MA organizations have already done enough to meet QI requirements without the QIP.
“The removal of the QIP and the continued implementation of the Chronic Care Improvement Program (CCIP) would allow MA organizations to focus on one project that supports improving the management of chronic conditions, a CMS priority, while reducing the duplication of other QI initiatives,” CMS said.
Levying of MA enrollment limits and lengthened enrollment periods
The proposed rule would reduce certain limits on the variety of MA plans payers can offer, and would add flexibility to MA uniformity requirements.
CMS believes that limiting the amount of MA plans a payer can offer in specific counties reduces the value of potential benefit offerings to consumers. The agency argues that consumers would benefit if they had more Medicare Advantage plan options, and that MA plans could improve plan quality without worrying about artificial limits.
CMS is also proposing new flexibilities that allow MA payers the ability to reduce cost-sharing for certain benefits, offer specific tailored supplemental benefits, and offer different deductibles for beneficiaries that meet specific medical criteria.
“We are announcing this important new benefit design an option for all MA plans,” CMS said. “Furthermore, after review of our existing authority, MA plans can vary supplemental benefits, in addition to premium and cost sharing, by each segment of an MA plan.”
The proposed rule would also increase MA open enrollment period by a month from January 2018 to March 2018.
Medicare Part D Enrollment limit reductions, rebate modifications, and generic drug tiering rules
CMS wants to eliminate Part D plan artificial limits on enhanced alternative benefit designs offered by the same payer within a region.
The agency also included a request for information on potential policy approaches for applying manufacturer rebates and all pharmacy price concessions to drug prices at the point of sale.
CMS also wants to eliminate the ability of Part D plans to exclude generic tiered drugs from tiering exception processes. CMS would add processes that tier drugs based on consumer requests.
“We are proposing to establish a tiering framework based on the type of drug (brand, generic, biological product) requested and the cost-sharing of applicable alternative drugs,” CMS said.
