Health Law Daily Part D sponsor assessed CMPs for auto-forwarding requests to IRE
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Tuesday, September 19, 2017

Part D sponsor assessed CMPs for auto-forwarding requests to IRE

By Sheila Lynch-Afryl, J.D., M.A.

CMS imposed a $3,600 civil money penalty (CMP) against Premier Health Insuring Company for failing to make timely decisions related to Medicare Part D coverage determinations, appeals, and grievances. As a result of the sponsor’s actions, enrollees experienced financial hardship and inappropriate delays in accessing prescription medications or asserting their appeal rights (CMS Letter to Premier Health Insuring Company, September 18, 2017).

42 C.F.R. Secs. 423.568(b)423.572(a), and 423.590(a) and (d) require Part D sponsors to process coverage determinations and redeterminations and notify enrollees of those determinations within specific time frames. A sponsor’s failure to process and notify a beneficiary of its determination in the prescribed time frame constitutes an adverse decision, and the sponsor must "auto-forward" the beneficiary’s request to the independent review entity (IRE) within 24 hours of the expiration of the adjudication time frame (see 42 C.F.R. Secs. 423.568(h), 423.572(d), 423.590(c), and 423.590(e)).

In December 2016, CMS notified Medicare Advantage organizations and prescription drug sponsors that it would be identifying organizations that are auto-forwarding inordinately high numbers of coverage determinations and redeterminations to the independent review entity. According to CMS, high rates of auto-forwarded cases indicate that sponsors are not processing and notifying enrollees of their coverage determinations within the required time frames.

Premier’s adjusted auto-forward rate for the second quarter of 2017 was 19.14 per 10,000 enrollees, which CMS considered to an outlier compared to other sponsors. CMS concluded, therefore, that Premier failed to comply with the requirements of 42 C.F.R. Part 423 Subpart M to process and notify enrollees of coverage determination and redetermination decisions within the required time frames.

Companies: Premier Health Insuring Company

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