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Feb. 12 — The Centers for Medicare & Medicaid Services Feb. 6 returned to a number of Medicare Advantage and Part D drug benefit provisions from a 2014 proposal in a final rule released Feb. 6 but said it will continue to set aside some of the more controversial proposed program changes.
The final provisions that will affect the upcoming 2016 contract year operations include prohibiting for two years applications for service area expansions and new contracts in the event that an organization terminated a previous contract within the preceding two-year period, and requiring “lawful presence or U.S. citizenship” for enrollees in MA and Part D plans.
“This final rule implements statutory requirements, improves program efficiencies, strengthens beneficiary protections, clarifies program requirements, improves payment accuracy, and makes technical changes,” the CMS said.
The final rule was published in the Feb. 12 Federal Register (80 Fed. Reg. 7,911). For the most part, it will take effect on March 16.
Bids for 2016 are due on June 1.
Provisions from the 2014 proposal that the agency said it wasn't finalizing include:
• lifting the protected class designation on three drug classes—antidepressants, antipsychotics and immunosuppressants for transplant rejection;
• requiring Part D sponsors to include any pharmacy willing to accept the terms and conditions to participate in narrower pharmacy networks that offer preferred cost sharing to beneficiaries;
• reducing the number of Part D plans a sponsor may offer;
• codifying CMS interpretation of the Part D non-interference provision;
• terminating contracts of Medicare Advantage organizations offering the drug benefit for failing for three consecutive years to achieve three stars on both Part C and Part D summary star ratings in the same contract year;
• limiting for two years submission of a new bid in an area where an MA plan has been required to terminate a low-enrollment MA plan; and
• medication therapy management program outreach strategies.
The provisions were part of a wide-ranging controversial proposal for Medicare Parts C and D that the CMS published in January 2014.
“The final regulation reflects consideration of public comments” to that proposal, the CMS said in a Feb. 6 statement.
After protests from lawmakers, beneficiaries, providers and trade groups in 2014, CMS Administrator Marilyn Tavenner said that, due to the complexities of the issues and stakeholder input, the agency wouldn't finalize most of the proposals at that time.
When part of the rule was finalized in May 2014 (RIN 0938-AR37, CMS–4159–F), it contained a list of more than 40 provisions that wouldn't be included in the rule.
At that time, the CMS said it was withdrawing the provision on classes of clinical concern.
The Feb. 6 final rule, Contract Year 2016 Policy and Technical Changes to the Medicare Advantage and the Medicare Prescription Drug Benefit Programs (CMS-4159-F2), cleared review at the White House Office of Management and Budget on Feb. 5. It was listed in the fall 2014 Department of Health and Human Services' regulatory agenda.
The provisions that were finalized include:
• Efficient Dispensing in Long-Term Care Facilities and Other Changes. Revises the rule requiring efficient dispensing to Part D enrollees in long-term care (LTC) facilities by: 1) adding a prohibition on payment arrangements that penalize the offering and adoption of more efficient dispensing techniques by prorating dispensing fees based on days’ supply or quantity dispensed; 2) adding a requirement that any difference in payment methodology incentivizes more efficient dispensing techniques; 3) eliminating language that has been misinterpreted as requiring the proration of dispensing fees; and 4) including a technical change to clarify the requirement to report on the nature and quantity of unused drugs. It doesn't finalize the proposal to waive the short-cycle dispensing requirements for LTC pharmacies using restock and reuse methodologies under certain conditions.
• Expanded Quality Improvement Program Regulations. Codifies recent expansion of quality improvement program policies and revises recent expansion of chronic care improvement program policies. Specifically, 422.152(a) reinforces the requirement at 422.152(c)-(d) that MA organizations conduct Quality Improvement Projects (QIPS) and Chronic Care Improvement Programs (CCIPs) for each of their plans on an annual basis.
• MA PD Coordination Requirements for Drugs Covered Under Parts A, B and D. Requires Medicare Advantage prescription drug (MA-PD) plans to establish and maintain a process with network pharmacies to ensure timely and accurate point-of-sale (POS) transactions. Such a process could include messaging and other procedures related to care continuity and coordination between Part D drug benefits and Parts A/B drug benefits administered by the MA PD plan.
• Business Continuity for MA Organizations and PDP Sponsors. Requires MA organizations and Part D sponsors to develop, maintain and implement business continuity plans that meet certain minimum standards. The final provision requires that MA organizations and Part D sponsors plan to restore essential operations within 72, rather than 24, hours of a failure.
• MA Organization Responsibilities in Disasters and Emergencies. Codifies and further clarifies an MA organization’s responsibilities when health plan services are affected by public health emergencies or disasters.
• Changes to Audit & Inspection Authority. Adds the word “timely” before agency audit and inspection authority to match the wording of the statute. Allows CMS to require MA organizations or Part D plan sponsors to hire an independent auditor to validate correction of CMS audit findings. Doesn't finalize the proposal to require plan sponsors to hire an independent auditor to conduct full or partial program audits.
• Part D Notice of Changes. Requires that MA organizations and Part D sponsors provide annual notice of changes to plan rules to the CMS for marketing material review and to all enrollees at least 15 days prior to the annual coordinated election period for changes that are effective with a new plan year.
• Medicare Coverage Gap Discount Program and Employer Group Waiver Plans (EGWP). Finalizes the provision that requires Part D sponsors offering employer group waiver plans to provide applicable discounts to EGWP enrollees as determined consistent with the Defined Standard benefit. The rule doesn't finalize the proposal that would have required Part D sponsors of EGWPs to disclose to each employer group the projected and actual manufacturer discount payments under the Discount Program attributable to the employer group’s enrollees, at least annually or upon request.
• Good Cause Processes. Permits the CMS to assign an entity, such as an MA organization, Part D sponsor or entity offering a cost plan, to act on its behalf to review good cause requests following involuntary disenrollment for nonpayment of premiums and effectuate reinstatements of beneficiary enrollment when criteria are met.
• Withdrawal of Stand Alone Prescription Drug Plan Bid Prior to Contract Execution. Imposes a two-year Part D applications ban on organizations approved by the CMS as qualified to enter into stand-alone PDP sponsor contracts but that elect, after the agency announcement of the low-income subsidy benchmark, not to enter into such contracts and withdraw their PDP bids.
• Essential Operations Test Requirement for Part D. Creates a new step, an “essential operations” test, in the application and contracting process with newly contracted entities operating as stand-alone PDP sponsors or MA organizations offering Part D plans.
• Agent and Broker Training and Testing Requirements. Removes requirement that agents and brokers be trained and tested with CMS-endorsed or approved documents; still requires that agents and brokers be trained and tested annually.
• Managing Disclosure and Recusal in P&T Conflicts of Interest. Requires a sponsor’s Pharmacy & Therapeutics (P&T) committee to clearly articulate and document processes to determine that certain requirements have been met, including determination by an objective party of whether disclosed financial interests are conflicts of interest and management of any recusals due to conflicts.
• Clarifications Related to When MA Organizations May Extend Adjudication Time Frames for Organization Determinations and Reconsiderations. Revises regulatory provisions to more clearly define the CMS's intended standard for when it is appropriate for an MA organization to extend an adjudication time frame.
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The final rule is at http://www.gpo.gov/fdsys/pkg/FR-2015-02-12/pdf/2015-02671.pdf. A fact sheet is available at http://tinyurl.com/no8tkvf.
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