Medicare Compliance & Reimbursement

Get ready for plan requirements to increase, too.

The pandemic revealed a plethora of health equity issues from skyrocketing drug prices to patients’ access to healthcare. As part of its 2023 rulemaking cycle, CMS continues to offer solutions that protect patients and address these problems — but the fixes won’t be easy and may require extra work on your part. Read on for the details.

Background: If you’ve been following the Centers for Medicare & Medicaid Services’ (CMS’) recent policymaking, then you’ve probably noticed common themes running through the agency’s myriad rules and policies: affordability, consumer rights, and health equity. The calendar year (CY) 2023 Medicare Advantage (MA) and Part D final rule promotes these ideals in its “strategic vision” with more cost savings and better quality care for beneficiaries — and more accountability for providers. The rule was published in the Federal Register on May 9.

“The Biden-Harris Administration has remained committed to ensuring equity in health care for all,” says CMS Administrator Chiquita Brooks-LaSure in a release. “This rule improves the health care experience and affordability for millions of people with MA and Part D coverage, including dually eligible individuals, and provides needed support to populations often left behind.”

Check Out These 7 Critical Takeaways

CMS makes access to care a priority while requiring more from MA and Part D plans on the part of transparency, reporting, and star ratings. Here are seven items that you should prepare for in 2023 and beyond:

1. Applications Part 1: MA and Part D plan standards are going up, and this may impact whether your contract application gets renewed. In fact, if your track record isn’t great, your application may get denied, CMS says. “To hold plans to a higher standard, CMS is finalizing additional bases for denying an MA and Part D organization’s application for a new contract or a service area expansion of an existing contract based on an organization’s past performance,” the rule fact sheet explains.

CMS “adds Star Ratings (2.5 or lower), bankruptcy or bankruptcy filings, and exceeding a CMS designated threshold for compliance actions as bases for” why the agency may deny your new application or contract expansion, indicates the final rule guidance.

2. Applications Part 2: Another MA application issue that CMS is homing in on revolves around network adequacy compliance, ensuring that MA plans have the provider resources upfront to help beneficiaries.

“The final rule requires MA applicants to demonstrate they have a sufficient network of contracted providers to care for beneficiaries before CMS will approve an application for a new or expanded contract,” notes Atlanta-based attorney Jasmine Becerra with King & Spalding LLP. “This updated policy aims to strengthen CMS’s oversight of an organization’s ability to provide an adequate network of providers to deliver care to MA enrollees,” Becerra says in online legal analysis.

This update is also a policy that the American Medical Association (AMA) advocated for and supports, the industry organization says. “Obviously, this information is needed at the beginning of the process. Discovering that you do not have access to necessary care in a time of illness adds a challenging layer to an already trying time. We very much welcome this patient-friendly move by CMS,” observes AMA President Gerald E. Harmon, MD, in a release.

3. Discounts: The final rule shines a spotlight on the “negotiated price” of prescription drugs and pharmacy arrangements. “Part D plans will now be required to pass on pharmacy discounts at the point of sale starting Jan. 1, 2024, which is expected to reduce out-of-pocket expenses for beneficiaries,” notes Holland & Knight LLP in the law firm’s H&K Health Dose newsletter.

4. MLR reporting: CMS is opting to return to its medical loss ratio (MLR) reporting requirements from the 2014-2017 contract years and expand reporting requirements for MA supplemental benefits. “The final rule requires MA organizations and Part D sponsors to report the underlying cost and revenue information needed to calculate and verify the MLR percentage and remittance amount, if any,” the fact sheet says.

5. Disasters: The COVID-19 public health emergency (PHE) factored greatly into many MA and Part D plan updates, but ensuring that beneficiaries have “uninterrupted access to needed services” during a disaster or emergency is at the top of CMS’ to-do list and was finalized in the rule.

“These policies require MA plans to cover services provided by non-contracted providers and waive gatekeeper referral requirements when there is a declaration of disaster or emergency and disruption in access to health care in the plan’s service area,” Becerra says.

6. Star ratings: The COVID-19 PHE caused CMS to tweak the Star Ratings methodologies; the final rule adopts some of those changes. CMS can now “calculate 2023 Part C Star Ratings for the three Healthcare Effectiveness Data and Information Set (HEDIS) measures collected through the Health Outcomes Survey (HOS): Monitoring Physical Activity, Reducing the Risk of Falling, and Improving Bladder Control,” according to the rule. “Without this technical change, CMS would be unable to calculate 2023 Star Ratings for these measures for any MA contract since all contracts qualify for the extreme and uncontrollable circumstances adjustment for COVID-19,” the agency explains.

7. Marketing: CMS followed through on its proposal of additional oversight of third-party marketing organizations to “to detect and prevent the use of confusing or potentially misleading activities to enroll beneficiaries in MA and Part D plans,” notes the rule.

Resources: Check out the announcement www.cms.gov/newsroom/fact-sheets/2023-medicare-advantage-and-part-d-rate-announcement and the final MA 2023 payment rate notice at www.cms.gov/files/document/2023-announcement.pdf.

Timeline: The majority of the regulations in the final rule are effective on June 28, 2022. However, “amendatory instructions 27 and 36 (regarding the definition of ‘negotiated price’ at §§ 423.100 and 423.2305)” will not go into effect until Jan. 1, 2024, CMS indicates.

Resource: Review the final rule at www.govinfo.gov/content/pkg/FR-2022-05-09/pdf/2022-09375.pdf.