The Annual Full Replacement COB Files Are on Their Way
It's that time of year again when Part D plans will receive full replacement Coordination of Benefits (COB) files from the Centers for Medicare & Medicaid Services (CMS). The Health Plan Management System (HPMS) memo dated 3/6/15 states that the 2015 Full Replacement COB files will be sent to organizations beginning March 19th. Plans will need to distinguish these files from daily COB notification files by the date of receipt and the file size. Easy enough? Not exactly.
Opportunity to Review and Correct Your Records
The full replacement COB files offer organizations a great opportunity to review their current records, make corrections, and re-sync with CMS. When a Medicare Part D enrollee has other prescription drug coverage, coordination of benefits allows the plans that provide coverage for this same beneficiary to determine each of their payment responsibilities. This process is necessary in order to avoid duplication of payment and to prevent Medicare from paying primary when it is the secondary payer. Unfortunately, many times plans will "just load" the data file when received. This is a very risky decision, as doing so will override information you have already validated with outdated information from CMS. File analytics is a necessary step in the process.
GHG can evaluate your file to determine actions needed, including verification letter mailing
- Part D sponsors are required to notify each beneficiary of other prescription drug coverage information as reflected in the COB file from CMS. The beneficiary should review the information and report back any updates. It's important to analyze the file and not send out verification letters to members unnecessarily, especially if a letter was recently sent to a member or if the member is terminated. Plans that use the "send letters to all" approach will realize this just overloads your customer service call center.
GHG can assist with the Primary record validation and correction
- Many times erroneous information is on the data file and gets loaded time and again. This can cause multiple problems such as bad COB flags at the Pharmacy Benefit Manager (PBM) or, worse, point-of-sale (POS) issues at the pharmacy which could lead to Complaint Tracking Module complaints (CTMs). It's important that information submitted to the Electronic Correspondence Referral System (ECRS) is valid, complete, and consistent. Transactions submitted that are incomplete or fail ECRS system edits will be submitted for development, which will place a freeze on the record for up to 100 days.
Unsure where to start? Contact me at ctobin@ghgadvisors.com, and let us help you maneuver through the COB file verification process.
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When it comes to financial reconciliation and overall membership data management, you must protect against leakage. Need help staying ahead of the CMS reconciliation process? GHG will access your member premium revenue, accounts receivable and CMS revenue reconciliation. 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!
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.
Resources
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!
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.
Resources
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.
Resources
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!
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!
Countdown to Final Submit
Today is the final day for current or potential plan sponsors to submit their Medicare Advantage and/or Part D application for a new contract or service area expansion (or service area expansion for 1876 Cost Plans). By now, many of you have already hit final submit and are either celebrating or working on known deficiencies. Or, perhaps you are still waiting for documentation or a final quality check of your submission before you feel confident to submit. Here are a few of the things we learned this year along the way.
- CMS has not updated their Part D readme file to include the FDR chart noted in 3.1.1C. It seems a bit redundant to the information entered in the Part D Data section of HPMS, but to each his or her own. CMS provides no template for that chart so we can imagine either it is overlooked upon initial submission by the applicant, or it is submitted in varied forms.
- Despite making reference to an additional webinar to be held after the second user call, no webinar was scheduled nor was any announcement made to correct that statement. However, CMS staff demonstrated timely responsiveness to posed questions both directly sent to application contacts as well as through the DMAO mailbox.
- With an industry push for quality (read: limited) network establishment, applicants can expect a high level of scrutiny on exception requests. If providers are available in a service area, CMS has stated that applicants should not even submit an exception request, so put those pencils down and step up contracting efforts.
You have until 8:00 PM Eastern Time tonight to submit your application. There should be a good sense of what potential deficiencies exist, so maintain the momentum to fill those gaps. Embrace the reality that CMS may certainly identify additional gaps in the submission. Ensure that your team has time built into your implementation plan to address any additional deficiencies.
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We've assisted scores of organizations through every step of the application process, from gathering the right data, completing the application, submitting, and responding to follow-up questions. Contact us today to ensure a smooth, compliant process.
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!
In 2015 a Slap on the Wrist Can Be the Kiss of Death
It is truth that in the second term of Democratic administrations, scores get settled between Washington regulators and business partners of the Federal government. 2015 will be no different for our favorite agency, the Centers for Medicare & Medicaid Services (CMS). It's already on a pace for 2015 to be the toughest year ever in enforcement actions against Medicare Advantage plans. And generally speaking, the regulatory bar is rising faster than anyone imagined. Consider:
- So far in 2015 CMS has issued significant new Medicare Advantage and Part D regulations, and this year's Advance Notice for 2016 rates and rules for Medicare and Part D health plans is the most anticipated I can remember in more than 20 years.
- 2015 is the toughest year in benchmark payment rates thanks to the approximately $200 billion in cuts from the Affordable Care Act.
- 2015's technical corrections for Star Ratings are almost bewildering in their complexity in raising the clinical bar. Indeed, in 2014, an election year, CMS famously told Medicare Advantage plans below 3 Stars for 3 consecutive years that a stay of execution was granted. In the fall, many of those low performers were quietly shown the door and were non-renewed. In 2015, however, the agency is handing out live ammunition to its firing squad. Now an intermediate sanction freezing marketing and enrollment automatically knocks the plan down to 2.5 Stars, often meaning loss of millions in bonus payments and rebate dollars. In competitive markets now, the first plan sanctioned is the first hunk of roadkill.
- The HHS Office of Inspector General, the guys with the badges and guns in Medicare, have made data validation audits for Medicare Advantage risk adjustment one of its top priorities in its 2015 workplan. And the President's budget includes over a half-billion dollars in recoveries from these RADV audits.
- But nowhere is there better evidence that the paper tiger is growing its claws back than in CMS' track record in enforcement actions against MA plans. In January, the agency levied the highest monthly toll of civil monetary penalties ever -- and if it keeps up the pace, 2015 will be nastiest enforcement environment in Medicare history.
*January 2015
Granted, CMPs don't typically amount to much, usually no more than a couple hundred grand, rarely 7 figures plus. But the damage is actually far greater, when considering damage in the local and national press; the chatter factor among beneficiaries; lost membership, and damage to the Star Rating and the relationship with CMS, which for many plans is or is becoming its biggest customer. A slap on the wrist is now the kiss of death in this environment.
Last week, my colleague conducted a webinar on the "Top 10 Things Killing Your MA Plan." CMS' top infractions, in order, are coverage determinations and grievances, and formulary administration, or performance of your pharmacy benefits management vendor. Those findings are driven by these 10 root causes:
Now is the time to ensure your compliance function and Medicare operations have the right tools, processes and people to be successful in the toughest environment we've ever seen in government health programs. In 2015, Gorman Health Group launched its latest product, CaseIQ™ , providing a new way to ensure your Appeals & Grievance cases come to a timely and compliant resolution. The tool not only captures all the data points needed to categorize, work and report coverage disputes and complaints; it also guides users through the appropriate processing of each case, minimizing the risk of non-compliance due to user error. Built and governed by GHG Medicare compliance subject matter experts, CaseIQ™ aims to keep our clients out of CMS' audit crosshairs. Learn more in our recent press release.
In addition, in the Common Conditions, Improvement Strategies, and Best Practices memo based on 2013 program audit results, CMS outlined areas where plans have been consistently non-compliant and described best practices to address failings. Ongoing monitoring is at the heart of non-compliance. Our solution, the Online Monitoring Tool(OMT™), is a highly flexible oversight tool and dash boarding software that brings together key metrics, documents, and tasks for ongoing monitoring and auditing, which results in the Organization being audit ready. This integrated solution also streamlines vital compliance activities, such as the implementation of new requirements and corrective actions. Read our recent White paper to learn more.
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CaseIQ™, GHG's latest solution, offers built-in reports that allow for tracking of past performance, current backlog as well as trends, and is designed to assist the caseworker to a complete and compliant resolution in Part C (MA) appeals, Part D appeals, and Part C and Part D grievances. 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!
2016 CMS Applications: Highlights and Basics
This week's CMS industry training on applications was quite informative, and contained many audience questions that you will want to hear. The recording is already available to registrants for those who missed it. There was way too much information for me to summarize, so I have included here a few highlights from the call and some basics that are easily overlooked.
Highlights
All new Part D applicants (MA-PD and PDP) who do not have a Part D contract with CMS that has been in effect for one year prior to application submission, must use a contracted first tier, downstream, or related entity (FDR) that has one year experience in the last two years performing functions in support of another Part D contract. Also, new PDP applicants must have two continuous years' experience offering health insurance immediately prior to submitting the application or five continuous years actively managing prescription drug benefits. CMS confirmed that the applicant can use the experience of a parent or subsidiary of its parent to comply with these requirements.
CMS also highlighted that applicants must validate their home infusion (HI) and long term care (LTC) pharmacies prior to submission. They must have valid NPIs. If you upload invalid information, the application will be considered deficient. This reminder is certainly a result of last year's CMS exercise of calling HI pharmacies directly to ask them about the services they perform. Based on the tone of yesterday's call, there is low tolerance for applicants that do not verify this information. They further mentioned that applicants must make sure their ITU file matches ITU reference file. "Even if the spelling is wrong, please use the wrong spelling." You will need to listen to the entire call recording to catch all the information provided, but the slides are a good start.
Nail down the basics.
- It may seem trivial, but make sure you have the right contact name in the Part C Application Contact and Part D Application contact fields. Earlier last year when CMS sent their first round of deficiency notices, only the application contacts received the emails at the plan — no one else. With only one week to address deficiencies or gaps after that first notice is received, it is imperative that the right contact is in place and that they are aware that they need to monitor notices from CMS quite closely.
- Cross-walk documents using pdf page numbers. CMS has quite a bit of information to review so point them directly to the requirement in your document, be it the Quality Improvement Plan or the PBM contract.
- CMS stresses to follow instructions and use the new templates for the Part D application; do not use anything from previous years. Also, do not submit such a thin application that is indicative that it is simply a placeholder for more time.
Make sure your effective dates are in line with the application requirements.
· Consider your licensure and contract effective and end dates. For example, your state license or certificate of authority needs to be in effect to cover the entire 2016 plan year. If yours expires mid-year, you can expect a deficiency unless you upload documentation showing the certificate covers the entire plan year, or other documentation such as proof of payment for the renewal.
· If you have a subcontract of an FDR that you must upload to CMS based on the fact they are performing a key Part D function, ensure that the effective date is appropriate. For example, one key Part D function is enrollment processing. Enrollment functions must be in place and operational during the AEP. Therefore, ensure that the effective date of a contract is in line with the time frame for which they will begin working with Part D beneficiaries on your behalf. (Remember: if delegating this or other key Part D functions to a parent organization, that executed subcontract must be uploaded. As mentioned in last week's call, the Part C agreements are not required this year for upload. )
In a couple days, I'll post some interesting things that our team has encountered along the way that may help shed light on the application documentation. For example: is there an upload missing from the Part D readme file? There sure is. Is there something in the PDF application that doesn't quite match HPMS? A couple things, actually. If you have questions, by all means follow CMS' instructions for questions! However, if you find anything that doesn't quite make sense that you'd like to share, we'd love to hear from you.
Resources
The application process for Medicare Advantage and Part D, the Health Insurance Marketplace, and ACOs is an arduous one. Completing the application requires the cooperation from your entire organization. The actual submission leaves no room for error, and the review process requires quick thinking and prompt responses to CMS follow up questions. Visit our website to learn how GHG can help >>
Registration for the Gorman Health Group 2015 Forum is now open. Join us April 7-9, 2015 at the Gaylord National Resort and Convention Center in National Harbor. Register today >>
A Christmas Wish List for Claims
Here's what I am wishing for all our health plan clients….an uneventful start to the 2015 Plan Year. By that I mean that all the prescription claims that should adjudicate without rejecting actually do, and the claims that should not pay, reject as expected. Either the beneficiary leaves the pharmacy with their medication or the pharmacist is alerted that there is a potential problem with the dose of the medication. Here are some of the issues that we have found from our reviews:
- Test claim for Unbreakable packaging logic for non-formulary drug prescription for a transition eligible member DRUG: NDC=51285008787 SEASONIQUE 0.15-0.03-0.01 TAB #91 tabs (3 months) Claim Rejects with this POS MESSAGE: "7X = DAYS SUPPLY EXCEEDS PLAN LIMITATION; MAX DS = 30 FOR TRANSITION FILL" This claim should have paid because the medication only comes in one size and is unbreakable.
- Test claim for Quantity Limit logic DRUG: NDC=59310057922 Product Description: PROAIR HFA 90 MCG 8.5 gm for 10 days supply HPMS submitted/approved Quantity Limit is 25.5/30 DS Claim Rejects with this POS MESSAGE: "88 = DUR REJECT ERROR " Additional Reject Message: "MX DOSE/DAY= 0.54 OVR/DR APV" The claim is rejecting for max dose incorrectly based on HPMS QL of 25.5/30 or 0.85/day.
- Test claim for maximum daily dosage of Acetaminophen < 4 Grams DRUG: NDC 46672020050 HYDROCODON-ACETAMIN 7.5-325/15 Solution Claim paid for #2365 ml/10 days supply which equates to 5125 mg or 5.1 Gm of Acetaminophen/day The claim should have rejected for exceeding the maximum daily dosage of Acetaminophen.
We continually emphasize the importance of benefit administration testing and retesting as the best Part D formulary quality control effort to ensure there are no questionable claims.
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.
I hope that your holidays are merry and bright, and that all your claims are right!
Resources
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. Don't chase data points. Spend your time on the things that will impact your audit results when a CMS audit comes — and it always does. Visit our website to learn more >>
Registration for the Gorman Health Group 2015 Forum is now open! Register your team for The Gorman Health Group 2015 Forum by December 31, 2014 and SAVE 30% off your ticket using promo code: EarlyBird30 at checkout.