CMS Releases MA and Part D Advance Notice and Draft Call Letter

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On January 30, the Centers for Medicare and Medicaid Services released its Medicare Advantage and Part D Advance Notice Part II and Draft Call Letter for 2020. The Advance Notice and Call Letter describes several proposals to combat the opioid crisis, including encouraging plan sponsors to make opioid reversal agents more accessible. Additionally, CMS proposes requiring Part D plans to place generic and brand-name drugs on separate formulary tiers. CMS estimates through the plan payment methodologies that it will increase plan revenues by an average of 1.59 percent for plan year 2020.

CMS releases a Rate Announcement and Call Letter on an annual basis informing MA and Part D plans of changes to payment methodologies and policies. For background, CMS released Part I of the Advance Notice in December 2018. CMS puts out an Advance Notice and Draft Call Letter to solicit input from stakeholders. Comments for Parts I and II of the Advance Notice as well as for the Draft Call Letter are due to the agency by March 1, 2019. CMS anticipates publishing the final 2020 Rate Announcement and Call Letter on April 1, 2019.

Major Provisions

The draft Call Letter for calendar year 2020 proposes improvements intended to help address the opioid epidemic through MA and Part D. This includes implementing provisions of the SUPPORT Act that require the coverage of opioid treatment programs, including Medication-Assisted Treatment (MAT). CMS is also encouraging plans to lower cost-sharing for naloxone and to co-prescribe naloxone alongside high doses of opioid analgesics. Furthermore, CMS reminds MA organizations that supplemental benefits may cover non-opioid pain management.

In an attempt to reduce beneficiaries’ out-of-pocket costs and “reduce confusion,” CMS is considering prohibiting Part D plan formulary tiers from including both generic and brand products, seeking instead to keep generics and brands on separate tiers. It also seeks comment on whether biosimilars should be treated the same as generics for this purpose.

CMS is additionally proposing in the Draft Call Letter to allow MA plans to offer non-primarily health related supplemental benefits to chronically-ill enrollees and to vary supplemental benefits based on individuals’ medical conditions and specific needs. This is in keeping with changes laid out by the Bipartisan Budget Act of 2018. These supplemental benefits can include non-medical transportation and meal delivery.

Part II of the Advance Notice expands on the changes to risk and payment methodologies for MA plans that CMS laid out in Part I of the Advance Notice. Based on its calculations of the proposed changes’ impact to its payment formulae, CMS estimates that MA plans face a 1.59 percent net increase in revenue for CY 2020.

CMS further proposes to adjust CY 2020 star ratings for MA and Part D plans to account for “extreme and uncontrollable circumstances.” It also proposes to remove the adult body mass index (BMI) assessment index, the appeals auto-forward, and the appeal upheld measures from the formulation of star ratings, citing low reliability.

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