2018 Medicare Advantage Plan Rates
2018 MEDICARE ADVANTAGE PLAN RATES
In April 2017, the federal government finalized its 2018 payment rates for Medicare Advantage (MA) plans, settling on an average rate increase of 0.45% after originally suggesting a 0.25% increase. After taking into account the expected growth in coding awareness, Medicare Advantage plans can expect a total change of 2.95% in revenue, according to the Centers for Medicare & Medicaid Services (CMS). Under CMS’s initial rate proposal, that number would have been 2.75%. Last year, the CMS approved a rate increase of 0.85% after initially proposing a 1.35% payment increase.
The CMS stated that the updated policies included in this year’s rate announcement gives Medicare Advantage organizations the incentive to develop new plan offerings that feature innovative provider network arrangements. These network arrangements may further encourage enrollees to access high quality healthcare services. CMS also anticipates that the updated policies will provide an increased variety of Medicare Advantage and Part D plans for enrollees to choose from. Plans that improve the quality of care they deliver to enrollees will see advanced updates, and grow and improve the benefits they offer to enrollees.
2018 Rate Announcement Policy Changes
According to CMS Administrator Seema Verma, Medicare is committed to strengthening Medicare Advantage and the Prescription Drug Program by supporting flexibility and efficiency. The rate announcement also makes other policy changes in response to industry feedback concerning the 2018 Advance Notice and Draft Call Letter in February.
The policy changes in the rate announcement provide incentives for plans to submit full encounter data. In 2018, CMS plans to modify the phase-in of the use of encounter data and will use the data for 15 percent of the risk adjustment payment to Medicare Advantage plans. CMS is also finalizing policies that will further the fight over opioid overutilization by encouraging safeguards before an opioid prescription is distributed at the pharmacy. However, these safeguards will still preserve the flexibility to maintain access to needed medications for Medicare enrollees in the Part D prescription drug benefit.
The CMS believes that Medicare Advantage Organizations and Part D sponsors, working with prescribing physicians, are in the ideal position to identify and employ the best practices and appropriate care management interventions for enrollees using high dose opioids. The CMS expects all Part D sponsors to focus on enhancing the management of care among these enrollees who are using a high dose of opioids. The organization also expects Medicare Advantage plans that include prescription drug coverage to consider expanding the care management they provide enrollees. Throughout the month of April the CMS also released a Request for Information to welcome continued feedback on Medicare Advantage and Part D plans.
AMGA and ACHP Approval
The policy garnered the approval of the AMGA, which is a trade group that represents multispecialty medical groups and integrated systems of care. They’re a team dedicated to dramatically improving population health and care for patients at lower costs. Chet Speed, AMGA’s Vice President of Public Policy, stated that it was essential that any Medicare Advantage risk adjustment be fair and accurate. Speed went on to say, “With the flaws in the current Encounter Data System, CMS made the right choice in dropping the weight to 15%.”
The Alliance of Community Health Plans (ACHP), which represents nonprofit insurers, also provided an email statement that they are happy that Medicare Advantage plans’ average revenue will marginally increase. Additionally, the organization was pleased that the CMS responded to concerns about some technical features of the payment policy. However, according to the group’s President and CEO, Ceci Connolly, the organization was disappointed that the CMS did not take the necessary steps to re-establish quality payments that have reduced benefits for 2.5 million seniors under the benchmark cap.
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