Contract Year 2020 Medicare Advantage and Part D Flexibility Final Rule

On April 5, 2019, the Centers for Medicare & Medicaid Services (CMS) issued a final rule that updates the Medicare Advantage (MA or Part C) and Medicare Prescription Drug Benefit (Part D) programs by promoting innovative plan designs, improved quality, and choices for patients.

CMS took significant action to increase MA plan choices for the 2019 plan year and aims to continue to expand opportunities so that patients have access to MA plans that meet their unique health needs. In continuing the efforts to increase plan flexibility and plan choices for patients, CMS is finalizing additional flexibilities that will provide patients with more MA options and new benefits.

This fact sheet discusses the major provisions of the final rule (CMS-4185-F) that will implement certain provisions of the Bipartisan Budget Act of 2018, improve MA and Part D program quality and accessibility, and clarify program integrity policies. The final rule can be downloaded from the Federal Register at:

Implementing the Bipartisan Budget Act of 2018 Provisions

CMS is implementing several sections of the Bipartisan Budget Act of 2018 (Public Law 115-123):

Medicare Advantage Plans Offering Additional Telehealth Benefits
The Bipartisan Budget Act of 2018 allows MA plans to include “additional telehealth benefits” (telehealth benefits beyond what Original Medicare allows) in their bids for the basic Medicare benefits, starting in plan year 2020. Under this final rule, MA enrollees may have great opportunities to receive healthcare services from places like their homes, rather than being required to go to a healthcare facility. MA plans will now have broader flexibility than is currently available in how they pay for coverage of telehealth benefits to meet the needs of their enrollees.

These changes will provide MA plans with the ability to offer expanded telehealth coverage to meet the needs of their patients. Patients in MA plans have always been able to receive more telehealth services than those in original Medicare, and with the final rule there is an even greater likelihood that these patients will have access to telehealth services from more providers and in more parts of the country than before, whether they live in rural or urban areas.

Integration Requirements for D-SNPs
CMS is finalizing new minimum criteria for Medicare and Medicaid integration in D-SNPs for contract year 2021 and subsequent years. Pursuant to the requirements in the Bipartisan Budget Act of 2018, we will require that D-SNPs meet the integration criteria either by, at a minimum, (1) covering Medicaid long-term services and supports and/or behavioral health services through a capitated payment from a state Medicaid agency; or (2) notifying the state Medicaid agency (or its designee) of hospital and skilled nursing facility admissions for at least one group of high-risk full-benefit dual eligible individuals, as determined by the state Medicaid agency.

Unified Grievance and Appeals Procedures for D-SNPs
CMS is finalizing rules to unify Medicare and Medicaid grievance and appeals processes for certain D-SNPs and affiliated Medicaid managed care plans. The processes will apply to D-SNPs with fully aligned enrollment and the affiliated Medicaid managed care organization, where one organization is responsible for managing Medicare and Medicaid benefits for all enrollees. In such D-SNPs, enrollees will have simpler, more straightforward grievance and appeals processes. The Bipartisan Budget Act of 2018 requires compliance with unified grievance and appeal procedures beginning in contract year 2021.

Improving Program Quality and Accessibility

Medicare Advantage and Part D Prescription Drug Plan Quality Rating System
As part of our efforts to continually improve the Star Ratings methodology, we are finalizing several measure updates, an enhanced methodology for determining cut points, and a policy to adjust the methodology for Star Ratings for affected MA and Part D plans in the event of extreme and uncontrollable circumstances, such as hurricanes. The final policy for extreme and uncontrollable circumstances is similar to the one implemented for the 2019 Star Ratings.

Based on stakeholder feedback to the Contract Year 2019 Medicare Advantage and Part D proposed rule (CMS-4182-P) and analyses of the data, we are finalizing an enhanced cut point methodology for data collected during the 2020 measurement year and associated 2022 Star Ratings that will improve stability and predictability and reduce the influence of outliers by implementing a guardrail, so that cut points do not increase or decrease more than a 5 percent cap from one year to the next.

Clarifying Program Integrity Policies

Preclusion List Requirements for Prescribers in Part D and Individuals and Entities in MA, Cost Plans, and Programs of All-Inclusive Care for the Elderly (PACE)
CMS announced in April 2018 that the agency would prohibit payment for Part D drugs and MA items or services that are prescribed or furnished by prescribers and providers on a “preclusion list.” CMS is now improving the preclusion list process to clarify the expectations for stakeholders. CMS is making the following revisions to our preclusion list policies:

Medicare Advantage Risk Adjustment Data Validation Provisions 
CMS conducts contract-level Risk Adjustment Data Validation (RADV) audits to verify the accuracy of payments made to MA organizations and recover improper payments. In 2012, CMS released a white paper informing MA and Part D sponsors of its intention to extrapolate audit recovery findings starting with payment year 2011 contract-level audits. The proposed provision in CMS-4185-P updated stakeholders on our plans to use various sampling and extrapolation methodologies in these and subsequent RADV audits. The comment period for the RADV proposalswas extended beyond the initial December 31, 2018 deadline to April 30, 2019 in order to maximize the opportunity for the public to provide meaningful input to CMS. Because the comment period was extended to April 30, 2019, the final rule does not address the RADV proposals. CMS intends to address the RADV provisions in a final rule at a later time.

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