On April 5, the Centers for Medicare & Medicaid Services ("CMS") released the 2024 Medicare Advantage and Prescription Drug Benefit Programs Final Rule ("Final Rule"), which will be codified at 42 C.F.R. Parts 417, 422, 423, 455, and 460. The Final Rule adopts a host of reforms aimed at improving health care access, quality, and equity for Medicare beneficiaries that receive coverage through Part C ("Medicare Advantage" or "MA") and prescription drug benefits through Part D. As discussed below, the Final Rule also has some notable omissions compared to what CMS previously proposed in December ("Proposed Rule," published at 87 Fed. Reg. 79452 (2022)). The Final Rule is effective June 5, 2023.
Part C Reforms
Pursuant to the Final Rule, if an MA plan prior authorized an item or service or made a pre-service determination of coverage or payment, the MA plan may not later deny coverage for lack of medical necessity and may not reopen the decision, except for "good cause" (as defined in 42 C.F.R. § 405.986) or "reliable evidence" of fraud or "similar fault" (as defined in 42 C.F.R. § 405.902). To limit interruptions in care, MA plans will be required to:
(1) grant prior authorizations that cover an entire course of treatment, plus a 90-day transition period when a beneficiary, mid-treatment, switches to or between Medicare plans;
(2) implement electronic medical record interoperability capabilities related to processing prior authorizations; and
(3) provide certain notifications to beneficiaries when the network terminates their providers.
See Final Rule at pp. 7-8.
The Final Rule defines a "course of treatment" based on the treating provider—i.e., "a prescribed order or ordered course of treatment for a specific individual with a specific condition is outlined and decided upon ahead of time with the patient and provider. A course of treatment may but is not required to be part of a treatment plan." See id. at p. 270.
The Final Rule contains a number of reforms to promote health equity under MA, including adding to the Star Ratings Program a health equity index reward to incentivize quality care for patients with certain social risk factors ("SRFs").1 See id. at p. 504. The SRFs include low-income subsidy, dual eligibility (meaning eligible for Medicare and Medicaid) and disability. Id. at p. 673. To promote equity in access to care between MA and traditional Medicare (i.e., Medicare Parts A and B), MA plans will also be required to comply with...
