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Payment Adjustment

Last month, CMS proposed a few changes to the Medicare Advantage and Part D prescription drug programs for the next year. The proposals brought forth include a rise in net payment rate for Medicare Advantage by 1.35 percent, the agency said. The annual Call Letter has stated an increase that is consistent with the 1.25 percent increase in 2016, which however followed a 0.9 percent reduction the year before.

The increase applies to the monthly capitated payments the agency makes to MA plans for each patient covered by the plan. The payments are adjusted for risk, based mainly on diagnosis coding. CMS projects a rise in MA plan coding by 2.2 percent, which will mean an average increase in revenue of 3.55% in 2017.

Stakeholders are concerned, as are legislators, that MA plans have been hiking the risks scores required for beneficiaries to earn higher payments. CMS has been looking to improve the risk adjustment process, and the annual letter lays out the agency’s ongoing efforts to achieve that end.

One of the proposals brought forward involves a new risk adjustment category for dual-eligible beneficiaries. According to CMS, the socio economic factors involved in some of the measures for the star rating system it currently employs are also important. But the proposals do not yet include any changes to the health risk assessments, or to the main mechanism used to determine risk scores for beneficiaries.

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Medicare Advantage

AHIP have been driving for the current payment rates to remain the same. The association let out a statement where they detail the consequences of the notice. President and CEO Marilyn Tavenner said, “More than 360 members of Congress and 2 million seniors in the Coalition for Medicare Choices urged CMS to protect Medicare Advantage from any further cuts,” and added that they would be examine the possibility of proposals which undermine the health plans’ care coordination and disease management programs, especially for low-income individuals.

Tavenner stressed the importance of CMs finalizing policies which ensure “long-term stability and continued growth of the program for millions of beneficiaries who depend on Medicare Advantage for their coverage.”

CMS stated that plans which improve the quality of care delivered to enrollees stand to see higher updates, and will be able to boost the benefits they offer to the latter. CMS also revealed that they wish to make payments for Medicare Advantage plans serving vulnerable populations, more precise. This would involve adjusting star ratings to show enrollees’ socioeconomic and/or disability status.