AMARILLO, TX – For the first 40 years of its existence, the DME industry has been a Traditional Medicare fee-for-service industry. This is rapidly changing. Today, approximately 50% of Medicare beneficiaries are covered by Medicare Advantage. This percent is expected to increase to 62% over the next several years.

Until recently, there has been very little CMS and Congressional oversight over Medicare Advantage plans. Fortunately, this is beginning to change. CMS and Congress are beginning to understand that Medicare Advantage has a number of flaws…and some abuses…that need to be addressed. Prior Medtrade Monday articles discuss these flaws and abuses.

The latest CMS guidance comes from an April 5, 2023 final rule that revises regulations pertaining to Medicare Advantage (“MA”), the Medicare Prescription Drug Benefit, Medicare Cost Plan, and Programs of All-Inclusive Care for the Elderly. The final rule was published in the April 12, 2023 Federal Register, and will be effective June 5, 2023.  This article summarizes the provisions applicable to the DME industry.

Utilization Management

• The final rule clarifies clinical criteria guidelines with the stated goal of ensuring that MA enrollees receive access to the same medically necessary care they would receive from Traditional Medicare. According to CMS, this clarification “aligns with recent Office of Inspector General (OIG) recommendations. Specifically, CMS clarifies rules related to acceptable coverage criteria for basic benefits by requiring that MA plans must comply with national coverage determinations (NCD), local coverage determinations (LCD), and general coverage and benefit conditions included in Traditional Medicare regulations.”
• When coverage criteria are not fully established, MA organizations may create internal coverage criteria based on current evidence in widely used treatment guidelines or clinical literature made publicly available to CMS, MA enrollees, and providers. In the final rule, CMS defines when applicable Medicare coverage criteria are not fully established by setting out the circumstances under which MA plans may apply internal coverage criteria when making medical necessity decisions.

Prior Authorization

• A goal of the final rule is to streamline prior authorization requirements, including adding continuity of care requirements and reducing disruptions for MA enrollees. The final rule requires coordinated care plan prior authorization policies to only be used to confirm the presence of diagnoses or other medical criteria and/or ensure that an item or service is medically necessary.
• Coordinated care plans must provide a minimum 90-day transition period when an enrollee currently undergoing treatment switches to a new MA plan, during which time the new MA plan may not require prior authorization for the active course of treatment.
• MA plans must establish a Utilization Management Committee to review policies annually and ensure consistency with Traditional Medicare’s national and local coverage decisions and guidelines.
• Approval of a prior authorization request for a course of treatment must be valid for as long as medically reasonable and necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient’s medical history, and the treating provider’s recommendation.

Marketing Requirements

• CMS is prohibiting ads that do not mention a specific plan name as well as ads that use words and imagery that may confuse beneficiaries or use language or Medicare logos in a way that is misleading, confusing, or misrepresents the plan.
• CMS (i) reinstates provisions designed to prevent predatory behavior and (ii) finalizes changes that strengthen the role of plans in monitoring agent and broker activity. CMS is finalizing requirements designed to protect Medicare beneficiaries by ensuring they receive accurate information about Medicare coverage and are aware of how to access accurate information from other available sources.

Strengthening Quality: Star Ratings Program

• CMS finalizes a health equity index (“HEI”) reward, beginning with the 2027 Star Ratings, to encourage MA and Part D plans to improve care for enrollees with certain social risk factors. CMS reduces the weight of patient experience/complaints and access measures to align with other CMS quality programs and the current CMS Quality Strategy. CMS includes an additional rule for the removal of Star Ratings measures and removes the 60 percent rule that is part of the adjustment for extreme and uncontrollable circumstances.

Advancing Health Equity 

• CMS is clarifying current rules, expanding the example list of populations that MA organizations must provide services to in a culturally competent manner. These include people: (i) with limited English proficiency or reading skills; (ii) of ethnic, cultural, racial, or religious minorities; (iii) with disabilities; (iv) who identify as lesbian, gay, bisexual, or other diverse sexual orientations; (v) who identify as transgender, nonbinary, and other diverse gender identities, or people who were born intersex; (vi) who live in rural areas and other areas with high levels of deprivation; and (vii) otherwise adversely affected by persistent poverty or inequality.
• CMS is finalizing requirements for MA organizations to develop and maintain procedures to offer digital health education to enrollees to improve access to medically necessary covered telehealth benefits.
• CMS is requiring MA organizations to include providers’ cultural and linguistic capabilities in provider directories.
• MA organizations’ quality improvement programs must include efforts to reduce disparities.

Improving Access to Behavioral Health 

• CMS is finalizing policies strengthening network adequacy requirements and reaffirming MA organizations’ responsibilities to provide behavioral health services. CMS will add Clinical Psychologists and Licensed Clinical Social Workers as specialty types for which it sets network standards, and make these types eligible for the 10-percentage point telehealth credit.

Cara C. Bachenheimer, JD, is an attorney with the Health Care Group at Brown & Fortunato, a law firm with a national health care practice based in Texas, where she heads up the firm’s Government Affairs Practice. Bachenheimer’s practice focuses on federal lobbying activities with Congress, the Administration, and federal regulatory agencies, such as CMS, FDA, IRS, and FAA. She can be reached at (806) 345-6321 or [email protected]. 

Jeffrey S. Baird, JD, is chairman of the Health Care Group at Brown & Fortunato, a law firm with a national health care practice based in Texas. He represents pharmacies, infusion companies, HME companies, manufacturers, and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization and can be reached at (806) 345-6320 or [email protected].

AAHOMECARE’S EDUCATIONAL WEBINAR

Negotiating Managed Care Contracts

Presented by: Jeffrey S. Baird, Esq., Brown & Fortunato & Colleen T. Byrom, Esq., Brown & Fortunato

Tuesday, April 25, 2023

1:30-2:30 p.m. CENTRAL TIME
Approximately 50% of Medicare beneficiaries are signed up with Medicare Advantage Plans (“MAPs”), while approximately 70% of Medicaid beneficiaries are signed up with Medicaid Managed Care Plans (“MMCPs”). These percentages are increasing. MAPs and MMCPs work essentially the same way: (i) the government health care program contracts with a “Plan” that is owned by an insurance company; (ii) the Plan signs up patients; (iii) the Plan signs contracts with hospitals, physicians, DME suppliers and other providers; and (iv) the government program pays the Plan that, in turn, pays the providers. In order to serve MAP and MMCP patients, DME suppliers must sign managed care contracts. In so doing, the supplier needs to be careful. Not only must the contract provide sufficient reimbursement to the supplier, but the contract will have some “trap” provisions that may be harmful to the supplier. This program will discuss the most important provisions that are contained in managed care contracts, such as covered services, medical necessity, passive amendments, incorporation of collateral documents, set-off, remedy for delay in payment, and payment forfeiture for late claims. The program will discuss how the supplier can negotiate with Plans; and the discussion will point out the provisions that are often non-negotiable and the provisions that are open to negotiation.

Register for Negotiating Managed Care Contracts on Tuesday, April 25, 2023, 1:30-2:30 p.m. CT, with Jeffrey S. Baird, Esq., and Colleen T. Byrom, Esq., of  Brown & Fortunato.

Members:  $99
Non-Members:  $129