PBM-Supported Part D Measures Impact Quality Bonus Payment Revenues

Regulatory time frames around coverage determinations and appeals have existed since the inception of the Part D benefit. Timely access to medications has been a hallmark of the “member protective” stance the Centers for Medicare & Medicaid Services (CMS) has taken since Day 1. So how is it, even 10+ years into the delivery of the program, compliance with these time frames continues to be the bane of health plan Compliance and Star Ratings teams?

When CMS posted the 2017 ratings in October, the Medicare Advantage Prescription Drug (MA-PD) plan averages actually fell from 4.5 and 3.3, respectively, in 2016 to 3.9 and 2.9 in 2017. How can this trend be accounted for in the wake of ongoing CMS pronouncements regarding its dismay at the large number of auto-forwards sent for external review and that it would closely watch outliers and take vigorous enforcement actions against plans?

Even with all of the prodromal warnings by CMS, we have started to see the impact of low scores in these two measures in the newly released 2017 Star Ratings.  Thirty-four plans that earned ≥4 stars in 2016 dropped below 4 stars in 2016 and will lose their Quality Bonus Payment (QBP) revenues. Of these, 53% earned only 1 star on both the Part D Appeals Upheld and Appeals Auto-forward measures, which, even if “artificially” reduced via unsatisfactory performance in CMS audits, were found to have substandard performance in this area.

Are Pharmacy Benefit Managers (PBMs) the culprit? Minimally, it must be restated the origin of these Star Ratings stemmed from compliance and member protection concerns, and if they were performing adequately, would have gone the way of, say…. call center hold times (by the same PBMs), which improved enough to be dispatched to the display measure list. Even with performance guarantees, intensive oversight by plans, onsite inspections, and internal audits, these misadventures continue to occur, and dire consequences follow. In general, PBM performance guarantees cannot begin to compensate for the potential lost bonus revenue, and plans are re-evaluating performance criteria, degree of health plan oversight required, and, in some cases, pondering the insourcing of all coverage determination-related activities. It may be time for “zero tolerance” in the health plan stance toward vendor-provided coverage determination services, as even one missed time frame may be a harbinger of more to come.

For questions or inquiries about how Gorman Health Group can support your organization’s Part D Star Ratings efforts, please contact me directly at lerwin@ghgadvisors.com.



GHG anticipates that CMS will continue adjusting thresholds, curving the Star Ratings year after year in an effort to separate the remarkable from the ordinary.  Now is a critical time – MA Plans must examine not just this year’s score and what contributed to it, but their Plan’s score history in the Stars program and what it says about the enterprise’s overall approach to key issues. Visit our website to learn more about how we can help your organization >>

New Webinar: During this webinar on November 9 at 1:30 pm ET, Regan Pennypacker, GHG’s Senior Vice President of Compliance Solutions, and Cynthia Pawley-Martin, our Senior Clinical Consultant, join Melissa Smith and Jordan Luke, the Director of Program Alignment and Partner Engagement Group at the CMS Office of Minority Health, to provide perspectives on how to implement CMS-recommended best practices in the real world within a health plan in support of Quality Improvement and Star Ratings activities as we continue focusing on providing person-centered, holistic care coordination to our members. Register now >>

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