Key Changes to Star Ratings from 2016 Draft Call Letter
Now that the news from last month's 2016 Advance Notice (also known as "the Call Letter") from the Centers for Medicare & Medicaid Services (CMS) has had time to sink in, it's time for the real work to begin.
Perhaps even more noteworthy than the long-discussed removal of 4-Star thresholds is CMS' planned interim action to reduce the weights of six Part C measures (for Medicare Advantage Organizations), and one Part D measure (for Prescription Drug Plans) by half to provide immediate Stars relief to plans serving dual eligibles. With these changes looking likely, plans are working feverishly to predict whether they may be on the winning or losing end of these program changes.
While CMS continues to study the correlation between low-income status and lower quality scores, there is much work to be done by health plans to rapidly operationalize the six 0.5-weighted measures, the retirement of three measures, the temporary retirement of one measure, specification changes to more than a dozen measures, and CMS' return of several additional measures that had previously been removed from the program. The sheer volume of these changes almost overshadow the long-awaited, and much-anticipated, introduction of the new Comprehensive Medication Review (CMR) Completion Rate for beneficiaries eligible for Medication Therapy Management (MTM) programs measure.
As is always the case with Star Ratings, time is of the essence as we chase the moving target set forth by CMS. With CMS' renewed commitment (inclusive of a timeline) for termination of plans with less than 3 Stars for three years, plans whose ratings are trending downward will need to work swiftly and effectively to incorporate not only these changes but also proven Stars best practices into 2015 work plans.
With the many changes to Star measures announced in the 2016 Advance Notice, plans may be finding it increasingly difficult to design, implement, and manage Star Ratings programs. Has your 2015 Stars action plan adequately addressed:
- Internal reporting, monitoring, and trending of measure-level performance?
- Provider targeting, education, and pay-for-performance (P4P) program changes to capture these changes?
- Evaluations of programs to determine those that are working (and those that are not)?
- The reduced influence that Diabetes Disease Management programs will have on Star Ratings?
- Changes to member interventions and wellness programs to address these program changes?
- Any weaknesses identified in the 2015 Star Ratings?
- Population health tools and strategies needed for Star Ratings success?
Gorman Health Group's team of experts can help your organization adapt to the new clinical areas emphasized in the Advance Notice, develop or enhance care coordination within your programs, or evaluate the effectiveness of your current Star Ratings program.
Contact us today, and let's work together to help your plan achieve 4 Stars.
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Gorman Health Group's Summary and Analysis of the 2016 Draft Call Letter and the Medicare Advantage (MA) Advance Notice is now available. Download it today >>
Our team of experts can help you develop or enhance care coordination within your programs and processes. Contact us today, and let's work together to help your plan achieve 4 Stars.
GHG can evaluate your Star Ratings approach, and identify tactics you can begin implementing immediately, to integrate initiatives, eliminate redundancies, and build an enterprise-wide Star management structure. Visit our website to learn more >>
Registration for the Gorman Health Group 2015 Forum is underway! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Room Rate expires on March 23. Register your team for The Gorman Health Group 2015 Forum today!
Go-to-Market — No Department Left Behind
Although the next Annual Election Period (AEP) is a ways off, now is the time to start thinking about product development and overall strategy. In most organizations, the start of the "Go-to-Market" (GTM) strategy discussions begins with the C-Suite, Product Development, and Sales and Marketing. This keen group of professionals works sequestered and siloed for a period of time and then, voilà , they emerge with the lifeline of the health plan's benefits and strategy in their hands.
In order to launch a successful set of products (as well as strategies for selling these products), one of the most important and initial steps must be the creation of a fully integrated GTM governance structure to enable the organization to manage more effectively between strategy implementation, optimization, compliance requirements, and results tracking of an integrated marketing strategy. This will require the involvement of multiple functional areas, even those that aren't traditionally thought of (e.g., Medical Management, Pharmacy, Compliance, Member Services, Provider Relations, etc.), which means no department can be left behind.
"The failure to include Compliance as part of GTM initiatives is a prime reason for some of the regulatory pitfalls that arise and are discovered way too late," says Regan Pennypacker, Vice President, Compliance Solutions. "Whether your organization deals in Medicare, Medicaid, or a combination of these lines of business, the overall guiding principles will be the same. A culture of compliance starts at the top and is effectively integrated when each area of the organization takes ownership of compliance requirements and expectations respective to each functional area."
Execution and management of this initiative is no easy task. A successful GTM strategy brings Compliance and operational stakeholders to the table. Assigning the right accountable parties at the onset is critical to ensuring regulatory requirements are implemented and overall strategy is executed. For suggestions and solutions on how to build your GTM strategy and team, contact me directly, cknight-lilly@ghgadvisors.com.
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Gorman Health Group's marketing experts have developed strategic plans for hundreds of Medicare Advantage Plans, Prescription Drug Plans, Special Needs Plans and Exchange participants. We will work with you to understand your market, mining demographic data for opportunity and finding the gaps in the competitive field into which your plan can fit. Visit our website to learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
Money Grab: CMS to Rerun Risk Scores, Implement Plan for Overpayment Recovery
Do you know your level of exposure for overpayment recovery from CMS?
On March 3, 2015, Cheri Rice, CMS' Director of Medicare Plan Payment Group, released a memo notifying all Medicare Advantage Organizations, PACE Organizations, and certain Demonstrations of its intent to rerun risk scores during the calendar year 2015. If you read this memo and muttered, "uh oh" under your breath, you might be thinking that your plan/organization owes CMS some money, and soon. If you haven't read this memo, "uh oh" would be an understatement.
The memo was brief and a bit vague, but the impact to health plans and providers could not be clearer. CMS will be rerunning risk score data and the corresponding payments made to plans dating back to 2008 Dates of Service (DOS), payment year 2009. Additionally, the memo anticipates that plans will clean up their data by submitting deletes. This could raise the specter of false claims if a plan fails to submit deletes when they knew, or should have known, of unsubstantiated risk adjustment submissions. This could get ugly, and fast.
The table below was included in the memo and outlines the DOS and payment years that CMS intends to rerun, assess, and then start collecting:
Do you know if your plan is at risk for receiving a letter from CMS requesting "money back?"
Better yet, do you find yourself asking the following questions?
- What is your level of exposure and how much money might you owe CMS depending on their findings?
- Do you know how many risk-adjustable diagnoses will be swept away when CMS reruns the data, and do you have the ability and infrastructure to conduct that analysis?
- What is the impact of the overpayment recovery effort on my provider contracts, relationships, and reimbursement?
- How will this effort impact my medical management, quality, and affordability strategies?
- Is this on my radar for our ICD-10 preparedness plan?
Gorman Health Group's team of experts can help your organization answer these questions and assess the impact to your plan, your providers, and your budget.
Unsure where to start? Contact me directly at dweinrieb@ghgadvisors.com.
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Gorman Health Group's Summary and Analysis of the 2016 Draft Call Letter and the Medicare Advantage (MA) Advance Notice is now available. Download it today >>
Gorman Health Group provides expert insight into state and federal regulations surrounding risk adjustment, as well as enterprise-wide strategies to address quality, trend, and risk revenue across all product lines. Learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
Is This Condition For Real? CMS Compliance Program Audit Findings Tied to FDR Oversight
There is no shortage of concern when it comes to awareness of first tier, downstream and related entity (FDR) oversight. In fact, during a recent webinar hosted by John Gorman, Executive Chairman at GHG, on "The Top 10 Things Killing Your Organization", we shared survey results showing the number one Compliance Program risk, from a health plan's perspective, is FDR oversight.
A number of compliance specialists recently asked us about a CMS condition that either they have received as part of a program audit, or have heard about others receiving. Specifically, the condition pertains to the failure to provide evidence that a Plan Sponsor's FDR employees received fraud, waste and abuse (FWA) training within 90 days of hiring or contracting and annually thereafter.
The citations previously referenced in this condition include 42 CFR § 422.503(b)(4)(vi)(C) and 42 CFR § 423.504(b)(4)(vi)(C), as well as the Compliance Program Guidelines, Section 50.3.2 (dated 1/1/2013). In summation, the CFR required MA organizations to establish and implement effective training and education, and the sub-regulatory guidance supported the regulation, also stating that:
- Sponsors may choose to tailor the training;
- Sponsors must provide the FWA training directly or provide FWA training materials to their FDRs; and
- Sponsors may have FDRs access CMS' standardized FWA training and education module
It is important that all Plan Sponsors are aware of the regulation change made effective as part of the Final Rule released May 24, 2014. In summary, 42 CFR § 422.503(b)(4)(vi)(C)(3) now states as follows: "A MA organization must require all of its first tier, downstream, and related entities to take the CMS training and accept the certificate of completion of the CMS training as satisfaction of this requirement. MA organizations are prohibited from developing and implementing their own training or providing supplemental training materials to fulfill this requirement." The corresponding update was also made to Part 423 for Part D.
For some organizations, this is business as usual. However, for those organizations that were providing their own training and delivering to their FDRs, this is no longer permissible as of 1/1/2016.Therefore, it is recommended that organizations implement this new requirement now. Make sure that any policies and procedures documenting this process are updated, especially since the Compliance Program Guidelines require update. For reference, the Medicare Learning Network is here and the link to the web based training courses is near the end of the page.
Have Questions? Contact me directly at rpennypacker@ghgadvisors.com
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Gorman Health Group's solution, the Online Monitoring Tool (OMT™), streamlines vital compliance activities, such as the implementation of new requirements and corrective actions. Read our recent White paper to learn more.
The external audit program process is fully customizable according to your organization's needs and can encompass both internal and delegated functions, CMS audit protocol, as well as the inclusion of other audit elements that are not part of the current protocol (e.g. enrollment, credentialing, member services). Don't let CMS be the first to tell you where your deficiencies are. Visit our website to learn more >>
Gorman Health Group's Summary and Analysis of the 2016 Draft Call Letter and the Medicare Advantage (MA) Advance Notice is now available. Download it today >>
Formulary Submission Reminders
The reprieve of Plan Sponsors having only one set of calendar year (CY) formularies to maintain is coming to an end. It's that time of year where, in preparation for CY 2016 formulary submission, Plan Sponsors are diligently assessing their formulary and benefit structure to optimize beneficiary access to formulary drugs while leveraging cost containment strategies.
The assessment should include an analysis between offering a custom formulary or a standard formulary offered by a Pharmacy Benefit Manager (PBM), including rebates, while meeting the needs of the Plan Sponsor's targeted population. Strategic collaboration among the clinical and financial decision-makers is critical to find the appropriate balance.
Although not formalized, but included in the draft 2016 Call Letter, the following two changes are important for Plan Sponsors to consider for the upcoming formulary submission: CMS is enhancing the Quantity Limit (QL) submission process for CY 2016. The Health Plan Management System (HPMS) formulary file field descriptors and allowable values will be changed for CY 2016. The Quantity_Limit_YN field will be changed to a Quantity_Limit_Type field. Sponsors will designate each formulary drug with a "0" (No QL), "1" (Daily QL), or "2" (QL over time).
Also, the tier labeling for generic tiers will change in CY 2016. There will no longer be a "Non-Preferred Generic" Tier. This change merges the generic and non-preferred generic tiers into one standard "Generic" tier, with the option of having a "Preferred Generic" tier with lower cost-sharing for a subset of generic drugs. In addition, CMS is reminding Plan Sponsors that a Drug Tier Label should be representative of the drugs that largely make up that tier when placing both brand and generic drugs in a tier and will be evaluating this trend as part of the bid review process.
A key component in the formulary development process is the consideration of utilization management (UM). Plan Sponsors may want to keep in mind the industry statistics. In 2014, the average Prescription Drug Plan (PDP) enrollee is in a plan where the formulary lists 83 percent of all eligible drugs, the same as in 2013, but slightly below the average in prior years. The average Medicare Advantage Prescription Drug (MA-PD) plan enrollee is in a plan with slightly more drugs on formulary (87 percent) than PDPs. Since 2007, PDPs have applied UM restrictions to an increasing share of on-formulary drugs, increasing from 18 percent in 2007 to 35 percent in 2014. MA-PDs tend to apply UM restrictions to a somewhat smaller share of drugs.
Key dates to remember regarding formulary submission are summarized in the table below.
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The rapid changes to Part D regulations make the tracking and implementation of these CMS requirements exceptionally difficult — to say nothing of actually managing to them. Our Part D services are designed with your staff in mind, ensuring that with a mix of counsel and DIY tools your staff will have access to actionable information — faster. Contact us today to learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
Industry Ducks Bullets in 2016 Medicare Advantage Rate Proposal
Friday, February 20th after close of business, the Centers for Medicare and Medicaid Services (CMS), released its 2016 Advance Notice of Medicare Advantage Payment, known affectionately as "the call letter."
This one was the most anticipated in years, and the industry unexpectedly ducks bullets in it, in risk adjustment, Star Ratings, and elsewhere. It's got a few unicorn farts in it, and a couple puffs of Chanel No. 5 as well.
The lack of any shockers is the bigger positive for the industry, a turning point really. CMS is saying it won't settle its scores with payers through policy, but through enforcement, where the facts are often too tough for politicians to stick their necks out.
Last fall's surprise positive announcement that MA benchmarks were tracking to increase 2.02% next year started this year's dance. Now comes the draft call letter, and on April 6, the final, all of which will be different as CMS winds through its process and the full fury of industry lobbying is brought to bear. It's worth noting that this year a first-time majority of 53 Senators signed the annual "don't hurt Medicare Advantage (MA)" letter to CMS, vs. only 40 last year. The increased Congressional pressure and the fact that MA now represents one out of three beneficiaries is driving this call letter.
By our calculations, the 0.95% reduction in MA benchmarks claimed by CMS is really negative 1.76% all-in. This is the unicorn fart. The final number quoted by CMS, 1.1% positive, is in part because CMS is taking credit for a 2.0% improvement in risk scores as plans continue to improve their risk adjustment management skills. Kinda cheeky. Our read on the underlying trend is +1.53%, frankly, better than we anticipated.
On risk adjustment, anticipation was that CMS would take a lethal shot at prospective in-home evaluations, a tough fee-for-service normalization factor, and an increase in the coding intensity adjustment, but NONE of those happened.
On home visits, despite a hailstorm of bad press and advocacy group investigations, CMS isn't even dealing anymore, just laying out "best practices" and saying "we're watching you." The regulators laid out 8 criteria that would make the prospective evaluation more like a risk assessment conducted by a Special Needs Plan, including:
- Evaluation performed by a physician or qualified non-physician practitioner
- Includes all components of the wellness visit including health risk assessment
- Medication review and reconciliation
- Scheduling appointments and referrals with appropriate providers and community resources
- Environmental scan of the home for safety risks and need for adaptive equipment
- Verifies that the information obtained during the assessment is furnished to appropriate plan staff and providers
- Provides enrollees with a summary of the information collected
- Enrolls the beneficiary in disease management or care management programs.
Taking these steps and embedding risk adjustment management inside a health plan's Medical Management department would effectively audit-proof the company from the dreaded data validation audits expected to intensify this year.
Another shocker: CMS did the absolute bare-minimum on the coding intensity adjustment, and then heaved up a dangerous proposal to recalculate it starting in 2017. If implemented, CMS would cut payments to all MA plans by enough so that total payments would be no greater than under the pre-HCC, pre-PIP-DCG, pre-2000 AAPCC demographic model. This would make risk adjustment a zero sum game, in which individual plans could win or lose, but in which CMS would never pay out more than under the old AAPCC model. That would settle the score on home visits once and for all, and indelibly damage risk adjustment as a healthcare financing innovation.
A final surprise: CMS acknowledges it has a problem on Star Ratings for health plans serving dual eligibles and the low-income. The agency is cutting the weight of several Stars measures where vulnerable members score poorly, by a whopping 50% in 2016. This buys time for CMS and several plans overweight with low-income members and highly exposed to Stars underperformance to conduct additional research and take steps against what is driving the correlation.
It was, in the end, a surprisingly favorable call letter for health plans and other stakeholders, particularly capitated provider organizations. But we're still a long way from the Final Notice on April 6. How plans should react:
- First, write comment letters. Deadline is March 6 at 5 pm EST.
- The proposal to cap total MA payments at the same level as would have been paid under the pre-2000 demographic-only risk adjustment system is dangerous. Plans need to point out how the Congress, in the 1997 Balanced Budget Act, mandated a health-based risk adjustment system because the demographic adjustments were inadequate. We are not aware of any authority in that, or any other law, to allow CMS to set a cap on total MA payments.
- Take the guidance on home risk assessments seriously, and implement CMS' suggestions before they become mandates. Plans must hard-wire their risk adjustment program into their care management program, so they are actively managing the risks they identify.
- Don't rely on averages: the impact of CMS rates and other changes will vary from county to county, market by market. Let us help you examine the impact on your service area.
- Continued rate pressure means plans have to continue to get better and better at the key components of their business: risk adjustment, care management, Stars, and enrollment data reconciliation.
- Focus on the Stars metrics with the greatest weights, especially the intermediate outcomes measures and the plan-wide quality improvement measures. Determine if the reweighting of seven metrics will have a positive or negative impact on your plan, and react to offset any negative effects, by emphasizing other metrics where there is room for improvement.
It's going to be an interesting 45 days to the Final Notice, but one thing is sure in this call letter: CMS is conceding that Medicare Advantage has gone mainstream, and that its support in Congress can no longer be tangled with. CMS is showing its preference to impact industry behavior through its boot rather than its pen.
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Join John Gorman, GHG Executive Chairman, and colleague, Bill MacBain, GHG's Senior Vice President of Strategy and former health plan CFO, as they provide a hard-hitting analysis of critical areas addressed in the document, including a look at the various components that make up the trend factor, a proposed change to how risk scores are determined, health risk assessments, and Star Rating measures on March 3, 2015. Register Now >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
Risk Adjustment Data Validation (RADV) Audits Just Got Real
Last night the second-largest Medicare Advantage plan in the country, Humana, filed an SEC document detailing a US Department of Justice investigation into the company's risk adjustment coding and data collection practices. The investigation is an extension of a 2010 physician-led whistleblower action under the False Claims Act. The company has over 3.2 million Medicare Advantage members.
For years CMS has struggled to define the process and methodology it would use to pursue payment recoveries from Medicare Advantage plans which were overpaid under risk adjustment. In 2012 it finalized its process and launched its first round of RADV audits, on a parallel track with those being conducted by the Office of Inspector General at the Department of Health and Human Services.
The Justice Department's involvement in the Humana audit would appear to indicate the review is in the advanced stages and has been underway for some time. The methodology assures an extrapolated repayment to the Federal government for unsubstantiated codes submitted for risk adjustment. That this action also comes in connection with the False Claims Act and a qui tam whistleblower action could signal serious trouble for the insurance giant.
RADV just got real.
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GHG can support your risk adjustment from start to finish when it comes to preparing for your RADV audit and prepare a readiness plan. We're standing by to support you in comprehensive audit coordination, limited audit oversight and targeted engagement services. Visit our website to learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
Value-Based Care: HHS Sets Timeline for Transition
The Health & Human Services Department (HHS) recently announced an accelerated time frame with regards to its efforts to transition the Medicare Fee-for-Service (FFS) payment system over to alternative reimbursement models. Not to be outdone and following on the heels of the HHS announcement where a private coalition of some of the nation's largest healthcare systems and payers announced an initiative to move from FFS payments to so-called value-based payment by 2020. This coalition, called the Health Care Transformation Task Force, was proposed by Richard Gilfallin, a former Medicare official and Chief Executive of Trinity Health, a Catholic system that operates in 21 states.
While there is widespread agreement amongst healthcare leaders and policy makers that the U.S. healthcare system needs to see a significant shift away from volume-based reimbursement to one that incentivizes providers for meeting quality measures, clinical outcomes, and financial savings, the announcement can also leave us shaking our collective heads and wondering how to meet a goal when, to date, it has been so randomly undefined. As stated by Dr. Timothy G. Ferris, who is leading the effort on behalf of Partners Healthcare, "It is really easy to agree on the big-picture stuff, but it gets more complicated when you get into the details." And therein lies the challenge. To repeat a well-worn phrase, the devil is in the detail.
Providers have been willing participants in the various CMS and CMMI initiatives; some willing, some dragged kicking and screaming, have stepped up to the plate to join the bandwagon. While we have made progress, we have fallen short of expectations. Roughly, 3%, 220 of approximately 6,690, of entities that were approved to participate in bundled payments moved forward to implement the new payments. Medicare Shared Savings Program (MSSP) participants have shown some quality improvements and saved Medicare approximately $417 million year one with the first 220 Accountable Care Organizations (ACOs); but this number is under 1% of the Medicare's FFS budget. Several of the original Pioneer ACOs have dropped out to pursue programs, such as MSSP, that offer less risk. A red flag in the new time line, and one that has affected the above initiatives, is poorly defined quality indicators and what truly constitutes value. With an accelerated time line to achieve a shift to volume-based payments, we should focus on lessons learned and steps needed to provide a roadmap to success.
Presently, alternative payment models account for approximately 20% of Medicare payments, and HHS expects to see that percentage rise to 30% by 2016 and to 50% by 2018. This same shift is already taking place within our commercial counterparts. The Blue Cross trade association reported last summer that 20% of their providers had contracts that prioritized quality over quantity, and Aetna reports that 28% of its reimbursements are now in value-based agreements and expects that number to rise to 75% by 2020. What steps do Medicare providers need to start thinking about to promote a similar shift?
- Partnerships: Some of the greatest partnerships in history, Batman & Robin, Abbot & Costello, Laverne & Shirley, have achieved much more together than on their own. As we look around for partners for ACOs, bundled payments, etc., we want to find providers that share our philosophy, geography, goals, and ideas. We need to do our due diligence and ensure we have established, clear-cut terms, methodologies in care, investments, and cost-savings; we also need to establish accountability up front.
- Consistent focus on the value of the opportunity: Involves understanding the change is not the flavor-of-the-month strategy, there will be expenses, and that collaboration is required to succeed.
- Strong leadership and governance: The shift to value-based reimbursement is dependent upon fostering a cultural change from the top down. Culture has its roots in the governance and leadership of the organization. There must be a unified approach around transparency, accountability, and effective outcomes. The key is to balance the upfront expenses and short-term impact to reach long-term success.
Furthermore, much speculation has been given on the change being provider-driven in order to meet the goals. With consumer savvy, newly aged-in Medicare beneficiaries, there is also a shift in patient expectations and what is available for their health care dollar. The new beneficiary is aging in from a world of patient engagement, incentive, and rewards programs, and will expect the same level of service. As HHS promotes "Better Care, Smarter Spending. Healthier People. Why It Matters?", an idealist would say it matters because we are all in this together….a realist would say, "Thanks HHS…but what are the quality measures, and how soon can I have them?" Additionally, the realist will also operate from the belief that there is no one perfect model but that different payment models apply to different treatment pricing scenarios.
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Here at Gorman Health Group, we can help you decide what payment models are appropriate to your unique circumstance and support your implementation efforts. Contact us today.
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
CMS Releases Part D Drugs and Formulary Requirements
The long awaited revision to the Prescription Drug Benefit Manual Chapter 6 is hot off the press. Many of the changes have been published previously by CMS in Best Practice guidance or communicated in the course of CMS compliance audits. The changes include additions to the sections on Medically Accepted Indications, drugs purchased in another country, drugs covered under Medicare Part A or B, policy regarding formulary changes, updates to the description of covered commercially available combination products, and updates to existing policies with respect to utilization management
The most pertinent changes include:
- Part D plans have to apply the Part B definition of a medically-accepted indication to chemotherapy drugs that aren't covered by Part B (therefore Part D covered drugs). "Part D sponsors will be required to thoroughly understand and apply Part B's definition of an anti-cancer chemotherapeutic regimen, utilize Part B compendia, and consider peer reviewed medical literature when necessary."
- Part D plans should use prior authorization (PA) for those drugs with the highest likelihood of non-Part D covered uses and if a medication is discovered to have been utilized for a non-Part D indication upon retrospective review, the PDE has to be deleted and the accumulators adjusted.
- To determine the appropriate Medicare A or B or D coverage "bucket" health plans may apply prior authorization, even if the beneficiary is currently taking the drug, and even if a protected class drug is involved.
- CMS expects Part D sponsors to work aggressively to eliminate any interruptions of current therapy
- Unless a prior authorization criteria is submitted to CMS and approved at a dosage level, the plan must honor prescription requests for PA approved drugs for all strengths
- Any QLs below the FDA-approved maximum dose or below the days' supply entered in the Part D benefit package (PBP) must be submitted and approved by CMS.
- High cost edits should be above the usual and customary price of drugs to ensure that beneficiaries with valid claims for drugs are not subject to the edit.
- Concurrent DUR edits of doses at or above FDA maximum approved dosing do not have to have prior approval from CMS. The labeling should clearly identify the dispensing as unsafe or contraindicated not just a precaution in the labeling.
- For transition, CMS is defining non-formulary Part D drugs to mean both: (1) Part D drugs that are not on a sponsor's formulary, and (2) Part D drugs that are on a sponsor's formulary but require prior authorization or step therapy, "since a formulary drug whose access is restricted via utilization management requirements is essentially equivalent to a non-formulary Part D drug to the extent that the relevant UM requirements are not met for a particular enrollee."
- If a plan reduces a quantity limit (e.g. 2 tablets daily to 1 tablet daily), this change would require the plan to provide a transition fill if requested.
- For transition, a new enrollee is one whose ongoing drug therapy (whether the health plan is able to determine ongoing therapy or not) could be potentially interrupted by a drug being non- formulary.
- So an enrollee who stays with the same contract number but changes PBPs is a new enrollee eligible for a transition supply because his or her ongoing drug therapy could potentially be interrupted. However, an enrollee who moves from one PBP to another may not be eligible for transition if the formulary is the same for both PBPs.
- CMS is mandating a minimum 108 day look-back period to determine if a member has ongoing medication therapy or not
- For retail transition, if the smallest available marketed package size is in excess of a 30 day supply, the plan must offer a transition supply when required.
- CMS is requiring up to a 91- to 98-day transition supply given that many LTC pharmacies and facilities must dispense brand medications in 14-day or less increments.
- For LTC members, plan sponsors do not have to provide more than one emergency supply fill for a drug
- Transition benefits accrue to beneficiaries at "network" pharmacies..
- Beneficiary opioid point of sale edits can be applied during transition. However, for non-formulary opioid medications and formulary opioid medication subject to prior authorization or step therapy under a new plan's utilization management rules, a temporary supply must be provided during transition.
- The cost sharing for LIS members for transition fills cannot be higher than the maximum copayments in statute; for non-LIS members non-formulary drugs filled in transition would have the same copayment as non-formulary drugs approved through the exception process and formulary drugs with utilization management edits would have the same copayment during transition that they would have once the um requirement has been met.
- For a medication that has multiple refills in transition, only one member and provider transition notice is required.
- Medically Accepted Indication for purposes of Part D is an FDA labeled indication or an indication supported by citation in either the American Hospital Formulary System (AHFS), USP-DI (or its successor publications), or DRUGDEX®.
Three particular requirements of note are practices that we have been recommending to plans for the past five years:
- thoroughly test the adjudication of the approved formularies in advance of and during the plan year to help identify errors
- routinely review rejected claims at POS so that discrepancies are discovered timely
- implement a continuity of care policy
Our Pharmacy experts can create and conduct an in-depth benefit administration test plan for your organization to validate that everything is working precisely as it should on an ongoing basis throughout the year. We can ensure your PBM is processing claims consistent with your CMS-Approved Prescription Drug Benefit.
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The rapid changes to Part D regulations make the tracking and implementation of these CMS requirements exceptionally difficult — to say nothing of actually managing to them. Our Part D services are designed with your staff in mind, ensuring that with a mix of counsel and DIY tools your staff will have access to actionable information — faster. Contact us today to learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Attendees can expect timely, actionable advice on the trends shaping health care from notable speakers, including Barclay's analyst, Joshua Raskin, and regulatory guidance directly from Jennifer Smith, a Director in the Medicare Parts C and D Enforcement Group at the Centers for Medicare & Medicaid Services (CMS). Register your team for The Gorman Health Group 2015 Forum today!
CMS Releases the 2015 Audit Protocol: Critical Next Steps to Avoid Becoming A Casualty of Reasonable Expectations
On February 12th, CMS released the 2015 Audit Protocol. The question on everyone's mind is — what does this mean for 2015? Well, it means a few things. Outlined below are some of the most impactful changes, as well as the "why" behind the change, and the trends that continue to emerge.
1. CMS has initiated a new audit cycle — this means that even if your Organization was audited in 2012, 2013, OR 2014, your Organization could be audited again this year.
2. CMS has included language with fangs around universe submission accuracy. For any Organization that has been audited in the last few years, this will come as no surprise. CMS has narrowed in on the fact that Organizations have a disturbingly hard time pulling accurate universes. The fact is that a dirty universe is a symptom of a much larger issue within the Organization — and CMS knows it. With the 2015 audit cycle, CMS will allow a maximum of three (3) attempts to submit an accurate universe. After the second failed attempt, CMS will automatically document an observation, and after the third failed attempt, the Organization will be cited an Immediate Corrective Action Required (ICAR) — for EACH condition that cannot be tested due to inaccurate universes.
3. CMS will again measure timeliness at the universe level for standard and expedited organization determinations, appeals, and grievances (ODAG) and for standard and expedited coverage determinations, appeals, and grievances (CDAG). However, in 2015, while CMS will request the same data as in past years, now each separate request will have its own universe template. What's the relevance here? This means that any programing that your Organization completed around current universe requests must be redone. This may seem like a small thing, but with the increased focus on review at the universe level, the increased emphasis on universe accuracy, AND the historical difficulty the industry has had with pulling accurate universes — this should be top on your Organization's list.
4. CMS has modified long-standing audit protocols such as the Compliance Program Effectiveness protocols which were "redesigned to be more outcomes focused and less burdensome". CMS will now test all seven elements of Compliance by pulling tracer samples, which means that CMS will trace the sample through the Organization to determine compliance. The move to using the tracer sample review for all seven elements is very telling. We see here that CMS is continuing to move toward a method of results oriented review vs. a review based on Organization policy. In other words, if you can't demonstrate Compliance, it probably doesn't exist.
5. CMS will incorporate two pilot review areas in 2015. First, review of the Medication Therapy Management (MTM) Program, which is to be expected with CMS' continued focus on Part D. Second, and more interesting, is the addition of the Provider Network Adequacy pilot. At first, you may wonder why CMS decided to include this out of all possible additions. Well, the answer is that CMS has become aware of issues with access to care, and these issues extend to access to physicians. In other words, your Organization must ensure that it is meeting network adequacy standards, specifically for specialty and sub-specialty providers, AND that the providers are open to treat enrollees.
As we can see from the above, CMS administrators are true to their word — CMS continues to intensify its focus on the health and well-being of the beneficiary, and they should. As John Gorman and I discussed during our webinar held on February 13th, titled, "Top 10 Things Killing Your MA Plan," CMS continues to have a laser focus on those issues that have potential to cause imminent beneficiary harm and weeding out those Organizations that are not able to appropriately care for the Medicare population — a trend which is clear both by the continued refinement of the Audit Protocols and by a steep increase in CMS Civil Monetary Penalties and Sanction Activity.
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