Medicare Plan Icon: Black Eye or Useful Tool?

Would alerting the public that a Medicare plan was hit with a fine be helpful for Medicare beneficiaries or just an unnecessary embarrassment for the health plan?

That’s a question the Medicare agency is pondering as it works to finalize 2019 guidance for the Medicare Advantage and Part D drug programs.

The Centers for Medicare & Medicaid Services has proposed a “civil money penalty” symbol or icon be placed next to the name of insurers that got one.

Plans can get the penalty for small and large missteps of program rules.

No word yet on what the symbol would look like but it probably won’t be attractive. The icon would be on the agency's Medicare Plan Finder, an online program that beneficiaries use to search for health plans. Medicare considers it one more tool to help beneficiaries make better informed choices on plans appropriate for them.

AARP agrees.

The large lobbying group for seniors said the symbol would showcase important differences among the available plan options. It recommended that Medicare start with consumer testing to ensure that the symbol is designed so that beneficiaries interpret it appropriately.

But plan representatives and their attorneys have a host of reasons why it’s a bad idea.

For example, Brian Dickerson, a partner in the Washington office of FisherBroyles LLP, said the icon could negatively affect negotiations between the agency and the penalized plan.

Currently, plans may want to negotiate a settlement in order to put the penalty behind them. But if there's potential for “branding” with the icon, the sponsor might try to fight the penalty rather than settle, he told me.

Some penalties are given for major violations resulting in enrollment freezes, and others are for minor violations resulting in a fine, the Pharmaceutical Care Management Association, a Washington-based trade association that represents pharmacy benefit managers, pointed out. Although penalties vary, there would be just one icon.

It’ll be a couple more weeks before we know whether the agency will go with the icon or side with the plans.

The final guidance will out be out in early April.

Read my full story here.

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