Under the proposed changes contained in Part II of the Advance Notice and Draft Call Letter, MA and Part D programs in 2019 will have increased flexibility and more options and benefits for beneficiaries, including steps to ensure new patient-doctor-plan communication in combatting the opioid crisis. CMS announced the release of Part II of the 2019 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and D Payment Policies (Advance Notice), which follows the earlier release of Part I of the Advance Notice that contains proposed changes to the Part C risk adjustment model (see CMS proposes MA risk adjustment model changes under Cures Act, December 28, 2017). The proposed payment methodology updates will also result in payment increases that are expected to result in an average growth in plan revenues of 1.84 percent. This revenue growth should help promote plan stability and encourage lower premiums.
MA risk adjustment model. As discussed in Part I of the Advance Notice, under changes to the CMS-Hierarchical Condition Categories (HCC) Risk Adjustment model, MA plans would receive payments that reflect the needs of the patients they serve. These changes to the model will improve risk adjustment as required by the 21st Century Cures Act (P.L. 114-255), including an evaluation of adding mental health, substance use disorder, and chronic kidney disease conditions to the risk adjustment model and making adjustments to take into account the number of conditions an individual beneficiary may have.
In addition, because the 21st Century Cures Act requires that CMS fully phase in the required changes to the risk adjustment model by 2022, CMS is proposing to begin the phase in of this new model in 2019, starting with a blend of 75 percent of the risk adjustment model used for payment in 2017 and 2018 and 25 percent of the new risk adjustment model proposed. CMS is also proposing to update the CMS-HCC End-Stage Renal Disease (ESRD) risk adjustment model and the Part D risk adjustment model for 2019.
Encounter data use. The quality of encounter data has improved over time, and as announced in Part I of the Advance Notice, the proposed risk adjustment model makes technical updates, including calibrating the model with more recent data, selecting diagnoses with the same method used for encounter data, and supplementing encounter data used in payment with inpatient data submitted to the historical risk adjustment data collection system (the Risk Adjustment Processing System (RAPS).
For 2019, CMS proposes to calculate risk scores by adding 25 percent of the risk score calculated using diagnoses from encounter data and Medicare fee-for-service (FFS) diagnoses with 75 percent of the risk score calculated with diagnoses from RAPS and FFS diagnoses. CMS is also proposing to implement the phase-in of the new risk adjustment model by calculating the encounter data-based risk scores exclusively with the new risk adjustment model, while maintaining use of the current risk adjustment model for calculating risk scores with RAPS data.
EGWPs. For 2019, CMS is proposing to complete the transition to administratively-set rates for Medicare Employer Group Waiver Plans (EGWPs) that was originally scheduled to be completed in 2018. CMS, however, is considering alternative policies for paying these plans and is soliciting comment on the final approach to implement in the final rate announcement.
Puerto Rico (and elsewhere). Puerto Rico has a far greater proportion of Medicare beneficiaries receiving benefits through MA than any other state or territory. Proposed 2019 policies include basing the MA county rates on the relatively higher costs of beneficiaries in FFS Medicare, interpreting the criteria used to determine which counties qualify for an increased quality bonus adjusted benchmark, and applying an adjustment to reflect the nationwide propensity of beneficiaries with zero claims. CMS is also proposing a variety of strategies, in Puerto Rico and elsewhere, including adjusting the 2019 and 2020 star ratings to take into account the effects of extreme and uncontrollable circumstances that occurred during the 2017 performance period, such as Hurricanes Harvey, Irma, and Maria, and the wildfires in California.
Opioid abuse in Part D program. While CMS’ overutilization monitoring system (OMS) has reduced the very high risk overutilization of prescription opioids in the Part D program, the Draft Call Letter proposes new strategies to more effectively address this issue for patients in Part D, including:
- Enhancing the OMS so that it identifies high risk beneficiaries who use "potentiator" drugs (such as gabapentin and pregabalin) in combination with prescription opioids to ensure that plans provide appropriate case management.
- Implementing technical revisions to the Pharmacy Quality Alliance (PQA) measures used by CMS to evaluate Part D sponsors’ progress in combatting the opioid crisis, and consideration of a new PQA measure, Concurrent Use of Opioids and Benzodiazepines.
- Expecting all sponsors to implement hard formulary-level cumulative opioid safety edits at point-of-sale (POS) at the pharmacy (which can only be overridden by the sponsor) at 90 morphine milligram equivalent (MME), with a seven-day supply allowance.
- Implementing a supply limit for initial fills of prescription opioids (e.g., 7 days) for the treatment of acute pain with or without a daily dose maximum (e.g., 50 MME).
- Expecting all sponsors to implement soft POS safety edits (which can be overridden by a pharmacist) based on duplicative therapy of multiple long-acting opioids, and request feedback on concurrent prescription opioid and benzodiazepine soft edits.
Star ratings. The more significant new measures for the 2019 star ratings included in the Draft Call Letter are: Statin Use in Persons with Diabetes (Part D) and Statin Therapy for Patients with Cardiovascular Disease (Part C). CMS would remove the Beneficiary Access and Performance Problems Measure in 2019. Based on plan feedback, CMS is also proposing scaled reductions for data completeness issues for the Part C and D appeals measures.
Expanding supplemental benefits. Previously, CMS has not allowed an item or service to be eligible as a supplemental benefit if the primary purpose includes daily maintenance. In the Draft Call Letter, CMS proposes allowing supplemental benefits if they compensate for physical impairments, diminish the impact of injuries or health conditions, and/or reduce avoidable emergency room utilization. This expansion will effectively increase the number of allowable supplemental benefit options and provide patients with benefits and services that may improve their quality of life and health outcomes.
Flexibility. The Draft Call Letter reminds MA and Part D plans that they can provide certain enrollees with access to different benefits and services. Specifically, MA plans can offer targeted cost sharing and supplemental benefits for specific enrollee populations based on health status or disease state in a manner that ensures that similarly situated individuals are treated uniformly.
Comment process. Comments on Part I and Part II of the proposed Advance Notice, as well as the Draft Call Letter must be submitted by March 5, 2018. The final 2019 Rate Announcement and Call Letter will be published by April 2, 2019.
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