CMS proposes decreasing payments to Medicare Advantage plans
The Centers for Medicare & Medicaid Services (CMS) released a draft call letter and advanced rate notice with proposed changes to the Medicare Advantage and Part D prescription drug program.
CMS is proposing to decrease payments per beneficiary to Medicare Advantage organizations in 2016 by an average of 0.95 percent. However, coupled with expected increases in revenue tied to improvements in coding, CMS said the revenue per beneficiary would increase an average of 1.05 percent based on its risk-adjustment models.
“We believe that this policy provides fair payments to plans and creates incentives for high quality care,” Sean Cavanaugh, CMS deputy administrator and director of the Center for Medicare, said in a conference call. “We are valuing stability in our payment policy proposals and continue to provide beneficiary improvements in networks and transparency and we continue to push for increased quality and increased patient satisfaction.”
Cavanaugh said that CMS wants Medicare Advantage health plans to detail how they use value-based contracting arrangements. Since last fall, CMS has been studying whether health plans are at a disadvantage under the Five-Star Quality Rating System if they have a large proportion of enrollees who are low-income or eligible for Medicare and Medicaid. Cavanaugh said CMS would release the results soon.
In its call letter, CMS proposed placing less emphasis on some measures that negatively affected low-income enrollees. With some plans making significant changes to their provider networks, CMS has also asked plans to provide their beneficiaries with accurate and up-to-date provider directories. In addition, Cavanaugh said CMS is working with Part D prescription drug sponsors to improve access to the preferred cost-sharing pharmacies.
Since the passage of the Patient Protection and Affordable Care Act in March 2010, enrollment in Medicare Advantage plans has increased 42 percent, according to CMS. During that same time period, premiums have decreased by approximately 6 percent. Further, more than 90 percent of Medicare beneficiaries have access to a $0 premium Medicare Advantage plan.
This year, more than 16 million beneficiaries are enrolled in Medicare Advantage plans, accounting for approximately 30 percent of Medicare enrollees. CMS estimates 60 percent of Medicare Advantage beneficiaries will enroll in a 4 or 5 star plan in 2015, up from 17 percent in 2009.
“The proposed policies provide fair payment plans, create incentives for high-quality care and spend our healthcare dollars wisely,” Cavanaugh said. “These represent stable rate policies that will minimize the disruptions for beneficiaries.”
Executive Editor
Tim Casey joined TriMed Media Group in 2015 as Executive Editor. For the previous four years, he worked as an editor and writer for HMP Communications, primarily focused on covering managed care issues and reporting from medical and health care conferences. He was also a staff reporter at the Sacramento Bee for more than four years covering professional, college and high school sports. He earned his undergraduate degree in psychology from the University of Notre Dame and his MBA degree from Georgetown University.