October 9, 2008

CMS Releases Interim Final Regulations
For Medicare Advantage Special Needs Plans

Introduction

On September 18, 2008 the Centers for Medicare & Medicaid Services (CMS), issued Interim Final Regulations, with a comment period, implementing certain aspects of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) concerning Medicare Parts C and D.  The primary, though not exclusive, matters addressed in this Interim Final Rule are Medicare Advantage Special Needs Plans and marketing rules relating to Medicare Advantage Plans and Prescription Drug Plans.

In a somewhat confusing preamble, CMS distinguishes these regulations from others that it intends to release "in the near future" that will respond to public comments made on a proposed rule it issued on May 16, 2008.  The confusion arises from the contents of the May proposed rule, which included specific provisions that were subsequently addressed by MIPPA as well as other provisions.

This Weekly Alert will discuss the regulations governing Medicare Advantage Special Needs Plans (SNPs), which address only some of the MIPPA provisions concerning SNPs and only some of the SNP provisions addressed in the May proposed rule.  A future Weekly Alert will address marketing provisions, both of this regulation and of a final rule also released on September 18.

The regulations governing Medicare Advantage Special Needs Plans address four key areas:

• Models of Care for SNPs;

• Contracts with State Medicaid agencies for Dual-Eligible SNPs;

• Disclosure of certain information for Dual-Eligible SNPs;

• Data collection, analysis and reporting.

Background

Created by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), SNPs are conceptually related to government-supported demonstrations, such as On Lok, the Program of All Inclusive Care for the Elderly (PACE), and the dual eligible integration demonstrations that have, for decades, delivered focused services to those Medicare beneficiaries who generally need more intense health care services than the average Medicare beneficiary.

The MMA laid out three specific categories of SNPs:

• Dual SNPs for those beneficiaries who are dually eligible for Medicare and Medicaid;

• Chronic SNPs for those beneficiaries who have a specific severe or disabling chronic condition identified by the SNP;

• Institutional SNPs for those beneficiaries residing in specified institutions for extended periods of time.

SNPs have proliferated since 2004, the first year of operation, due in part to the revenue they generate for plans.  In 2004, 11 SNPs were approved by CMS.  As of January 2008, CMS had approved 787 SNPs, comprising 442 dual-eligible SNPs, 256 chronic care SNPs, and 89 institutional SNPs.  In September 2008, SNPs enrolled more than 1.2 million people.

In marked contrast with "regular" Medicare Advantage (MA) plans, which are prohibited from discriminating among Medicare beneficiaries in their enrollment, SNPs are designed to serve, either exclusively or disproportionately, specific Medicare subpopulations.  SNPs must be coordinated care plans and they must offer a Part D (prescription drug) benefit in addition to all benefits under Parts A and B.  Aside from these two conditions, SNPs have operated with few requirements from either the law or implementing regulations and with little oversight of how or whether they deliver what they promise.

Additionally, SNPs are not subject to the same enrollment periods as other Medicare Advantage plans.  Dual eligible beneficiaries and beneficiaries who reside in an institution are not subject to the "lock-in rules" for all MA plans, including SNPs, so they may enroll in or disenroll from an MA plan at any time.  CMS created a special enrollment period (SEP) to allow beneficiaries to enroll in a chronic care SNP at any time. However, these beneficiaries can only disenroll from the chronic care SNP during the Annual Enrollment Period (November 15 – December 31) or the open enrollment period (January 1- March 31).

Interim Final Rule

• Models of Care/Care Management.  Each SNP must implement an evidence-based model of care with networks of providers and specialists designed to meet the needs of the specific population the plan is serving.  The preamble to the regulations makes clear that CMS will not prescribe a particular model of care; rather, CMS directs plans to the website of the Agency for Healthcare Research and Quality (www.ahrq.gov) where various models of care are identified and evaluated.

In addition to the model of care, MIPPA and the regulation require care management comprising, essentially, three elements:

• A comprehensive initial assessment (and annual reassessments) of the individual's physical, psychosocial and functional needs using a tool that CMS will review through oversight;

• A care plan developed by an interdisciplinary care team and in consultation with the individual, identifying goals and objectives as well as specific services and benefits to be provided;

• An interdisciplinary team to manage the care.

The regulatory language for this provision closely tracks MIPPA language.  Although the preamble says the provision is effective January 1, 2010 (as it is under MIPPA), the regulatory language is silent on effective date and the overall effective date of the rule is September 18, 2008.  Model of care requirements were actually included in CMS's Call Letter for 2009 for SNPs, so SNPs being offered during the upcoming Annual Enrollment Period starting November 15, 2008, are required to have designed a model of care.

• Contracts for State Medicaid Agencies for Dual SNPs.  This regulatory provision implements the MIPPA provision requiring that by January 1, 2010, a Dual SNP plan will have a contract with the State Medicaid agency in the state in which it operates that assures that the plan will provide, or arrange for the provision of, Medicaid benefits available to the dual eligible enrollee of the plan.

The regulation includes greater detail than the statute, requiring that the contract document:

1. The plan's responsibility with respect to Medicaid benefits;

2. The categories of dual eligibles served by the plan;

3. The Medicaid benefits covered by the SNP;

4. Cost-sharing protections covered under the SNP;

5. Identification and sharing of information on Medicaid provider participation;

6. Verification of the enrollee's eligibility for both Medicare and Medicaid;

7. The service area of the SNP; and

8. The contract period.

Plans newly operating in 2010 must have such a contract; existing plans without a contract can continue to operate but cannot expand their service areas.

 

While much might be said of these requirements, two elements stand out for comment.  CMS does not specify the parameters of cost-sharing protections, suggesting in its regulatory language that the contract must merely specify what they are. MIPPA, however, is more prescriptive: it prohibits plan cost-sharing for those in Dual SNPs from being greater than it would be if the individual were not in a Medicare Advantage plan, thus incorporating protections that pre-date MIPPA.  Element five of the contract, regarding Medicaid provider participation raises the question of how a SNP could possibly be providing Medicaid services, as required under the contract, without an extensive Medicaid provider network.  Yet again, CMS is silent on the particulars of this requirement.

• Disclosure Requirements for Dual SNPs.  MIPPA requires that Dual SNPs provide to each prospective enrollee a written statement, using standardized content and format established by the Secretary, describing the benefits and cost-sharing protections the individual is entitled to under Medicaid and which of those are provided under the plan. It should be noted that this language suggests that the contract between the state Medicaid agency and the Dual SNP does not necessarily include having the SNP provide all Medicaid benefits available to the individual.
  
  The regulatory provision changes this statutory requirement to say that the plan must provide a statement of benefits the individual is entitled to under Medicare and Medicaid.  It makes no mention of the standardized content and format required by MIPPA, nor of any statement of benefits provided by the plan.
   

• Quality Improvement Program.  MIPPA required that all SNPs, as part of their Quality Improvement Program, collect, analyze and report data related to their model of care.  The data are required to be collected at the plan, rather than the sponsor, level and must permit the measurement of health outcomes and other indices of quality related to the model of care.

The regulation elaborates on the statutory provision by requiring that the data demonstrate:

1. Access to care;

2. Improvement in beneficiary health status;

3. Staff implementation of the model of care;

4. Comprehensive health risk assessment;

5. Implementation of an individualized plan of care;

6. A provider network with targeted clinical expertise;

7. Delivery of services across the continuum of care;

8. Delivery of extra services that meet the specialized needs of enrollees;

9. Use of evidence-based practices; and

10. Use of integrated systems of communication.

For many of these ten indicators, the regulation provides examples of data that would support the element.  For access to care, CMS suggests data on service and benefit utilization rates, or timeliness of referrals or treatment.

 

Again, much might be said of each of these requirements, but one stands out:  improvement in beneficiary health status.  CMS suggests "quality of life indicators, depression scales, or chronic disease outcomes" as measures of this element.  But the very requirement to report on improvement in health status raises the concern that plans would be cautious about whom they enroll, to ensure they can demonstrate that they are improving the health status of their enrollees.

Conclusion

The Center for Medicare Advocacy has developed recommendations (see http://www.medicareadvocacy.org/MA_08_01.31.SNPConference.htm) with respect to federal requirements and oversight for SNPs.  While the MIPPA and regulatory requirements are first steps toward making SNPs different from, and potentially better than, other forms of health care delivery for this population, more is left to do.  The Center will continue to report on SNP developments.

Although some of these rules are already in effect (though, as noted, the preamble suggests effective dates for some provisions different from what appears in the provisions themselves), CMS invites comment on them.  Comments are due no later than 5 p.m. EST on November 17, 2008. For the regulations and details about filing comments, go to http://www.access.gpo.gov/su_docs/fedreg/a080918c.html and scroll down to Centers for Medicare & Medicaid Services, then Revisions to the Medicare Advantage and Prescription Drug Benefit Programs, 54226-54254 [E8-21686].  The Center for Medicare Advocacy hopes to make its comments available for others in advance of the due date.

Copyright © 2008 Center for Medicare Advocacy, Inc.