Healthcare Business News

CMS issues proposed Medicare Advantage, Part D regs

By Paul Barr
Posted: February 15, 2013 - 7:00 pm ET

The CMS issued proposed terms for insurers participating in the Medicare Advantage Part C insurance program—including a growth percentage benchmark of negative 2.2% that will be used to help determine 2014 capitation rates.

The CMS also issued proposed beneficiary deductible levels, out-of-pocket thresholds, and coverage limits for Medicare Part D drug insurance program for 2014, as part of what the agency calls an advance notice and draft call letter.

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In addition to that notice, the CMS also issued a report describing the 2011 medical loss ratio-performance (PDF) of private insurance plans and a proposed rule regarding medical-loss ratio requirements (PDF) of the Part C and Part D programs.

The Medicare Advantage growth percentage rate of negative 2.2% “is due to historically low growth in Medicare per-capita spending, tied, in part, to successful initiatives undertaken to promote value over volume and help curb fraud, waste and abuse in the Medicare fee-for-service program,” according to the CMS release.

Meanwhile, the MLR performance report for private insurance plans included analysis showing 24.5% of health insurers did not meet MLR standards in at least one market in 2011, meaning they owed rebates to beneficiaries, under terms of the healthcare reform law.

Insurers owing the most in rebates were (in alphabetical order) Aetna, Cigna, Blues not-for-profit Health Care Service Corp., Humana, UnitedHealth and for-profit Blues company WellPoint, according to the CMS.

Rebates totaled about $1.1 billion, an average of $137 per family, based on 13.1 million families getting rebates.

The CMS proposed rule outlining proposed MLR requirements for Medicare Part C and Part D will guide plans in the program on how to comply with the requirement that at least 85% of revenue be spent on clinical services, prescription drugs, quality improvements, and/or direct benefits to the beneficiaries via reduced premiums.

Comments on the advance notice and draft call letter must be submitted by March 1, according to the CMS, with a final 2014 rate announcement and call letter expected to be published on April 1.

Comments for the MLR requirements proposed rule must be submitted within 60 days of Feb. 15, according to the filing.

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