CMS sets new rules for Medicare Advantage, Part D plans

The Centers for Medicare & Medicaid Services (CMS) last week issued its annual “Call Letter” to insurers that intend to offer Medicare Advantage and prescription-drug (Part D) plans in 2010, setting new standards to lower seniors’ out-of-pocket costs and improve transparency.
Insurers have until June 1 to submit bids for next year; open enrollment starts Nov. 15. More than 10 million beneficiaries are enrolled in Medicare Advantage plans, and more than 17 million are enrolled in Part D prescription drug plans.
CMS said it plans to review Medicare Advantage plans to ensure that cost-sharing for such services as renal dialysis, Part B drugs or home health or skilled nursing services is not “discriminatory,” and it plans to cap beneficiaries’ out-of-pocket costs for all services covered by standard fee-for-service Medicare at $3,400 per year.
CMS is also asking Medicare Advantage organizations to make sure the plans they offer in 2010 “significantly differ” from one another, and it said it plans to eliminate plans with fewer than 10 enrollees.
CMS is also asking Part D plan sponsors to outline all the tools used by the plan to lower costs and improve outcomes, known as utilization management criteria, on their Web sites. Plan sponsors will list specific details about quantity limits and step therapy requirements, as well as information about prior-authorization requirements and other limitations.
Prescription drug plan sponsors also will be required to provide additional and easy to understand information about coverage during the “donut hole” gap in Part D plans. This information will include how the plan will cover both brand and generic drugs in the gap.
“Having more transparent information available to help people with Medicare make confident choices in their health and drug coverage is important to President Obama and CMS,” said Jonathan Blum, acting director of CMS’s Center for Drug and Health Plan Choice. “By strengthening our oversight efforts, we are protecting beneficiaries and taxpayers by ensuring that the data provided by plan sponsors is reliable and correct.”
In addition, insurers are being asked to conduct audits on the data provided to CMS about the operation of their plans. These new audits will be in addition to the current CMS financial and program compliance audits. They will focus on high-risk areas that have the greatest potential for beneficiary harm, such as enrollment operations, appeals and grievances, and marketing.
“By strengthening these data collection processes, we will have an early warning system in place to be sure beneficiaries are not at risk of losing access to prescription drugs or health care services if plans have problems,” said Blum.
The 2010 Call Letter can be read at www.cms.hhs.gov/

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