2018 Bipartisan Budget Act: Greater Access, Innovation, and Technology in the Administration of Medicare Advantage Plans - Part I

This is the first installment of a two-part series on the Bipartisan Budget Act. Part II will discuss the Bipartisan Budget Act’s effect on the federal Stark Law.

Prior to adjourning for spring recess, Congress passed and the President signed into law on March 23, 2018, omnibus appropriations legislation that funds the government for the remainder of the fiscal year – through September 30. As part of the earlier negotiations to reach the budget deal, Congress passed and the President signed into law on February 9, 2018, the Bipartisan Budget Act, which included dozens of provisions to extend and modify a variety of health care measures.

Several of the provisions modify Medicare Advantage plans, specifically allowing for continued access to special needs plans for vulnerable populations; adapting benefits to meet the needs of chronically ill enrollees; expanding supplemental benefits for the chronically ill; increasing convenience through telehealth; and, changes to the calculation of star ratings for consolidated plans.

Here are summaries of the five sections of the Bipartisan Budget Act pertaining to Medicare Advantage Plans[1]:


Subtitle B – Advancing Team-Based Care

Section 50311. Providing continued access to Medicare Advantage special needs plans for vulnerable populations. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P.L. 108-173) established a new Medicare Advantage (MA) coordinated care plan to provide services for individuals with special needs. Special needs plans (SNPs) are permitted to target enrollment to one or more types of special needs individuals, including those who are (1) institutionalized, (2) dually eligible for both Medicare and Medicaid, or (3) living with severe or disabling chronic conditions. Among other changes, the Affordable Care Act extended SNP authority through December 31, 2013, and temporarily extended authority through the end of 2012 for dual eligible SNPs without contracts with state Medicaid programs to continue to operate, but in their current service areas. After 2012, dual eligible SNPs, new and renewing, were required to have contracts with state Medicaid agencies. Several subsequent laws have extended SNP authority without interruption; most recently, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA, P.L. 114-10) extended SNP authority through December 31, 2018.

In this section, the Medicare-Medicaid Coordination Office would be directed to serve as a dedicated point of contact for states to assist with Medicare and Medicaid integration efforts, and the Secretary would be required to work through this office to establish a unified grievances and appeals process for individuals enrolled in a D-SNP. This section would permanently authorize the I-SNP, D-SNP and C-SNP, if certain requirements are met. By 2021, a D-SNP contract would be required to have a unified grievances and appeals procedure in place, and by 2021, a D-SNP would be required to integrate Medicare and Medicaid long-term services and supports and/or behavioral health services by meeting one of three requirements. Failure to meet one of the three integration requirements would result in suspension of enrollment. MedPAC, in consultation with MACPAC, would be required to conduct a study and report to Congress on the quality of D-SNPs. Beginning in 2020, a C-SNP would be required to meet additional requirements to improve care management for the beneficiaries with severe or disabling chronic conditions enrolled in the plan. By January 1, 2022, and every five years thereafter, the Secretary would be required to update the list of chronic conditions eligible for participation in a C-SNP. The updated list must include HIV/AIDS, end-stage renal disease, and chronic and disabling mental illness. The Secretary may consider implementing the quality star rating system at the plan level for SNPs and all MA plans. GAO would be instructed to conduct a study and report on state-level integration between D-SNPs and Medicaid within two years of enactment.

Subtitle C – Expanding Innovation and Technology

Section 50321. Adapting benefits to meet the needs of chronically ill Medicare Advantage enrollees. Under Medicare Advantage (MA) private health plans are paid a per-person monthly amount to provide all Medicare-covered benefits (except hospice) to beneficiaries who enroll. Unlike original Medicare, where providers are paid for each item or service provided to a beneficiary, an MA plan receives the same capitated monthly payment regardless of how many or few services a beneficiary actually uses. The plan is at-risk if aggregate costs for its enrollees exceed program payments and beneficiary cost sharing; conversely, in general, the plan can retain savings if aggregate enrollee costs are less than program payments and cost sharing. Currently, an MA plan must offer the same benefit package to all of its enrollees. The Centers for Medicare and Medicaid Innovations (CMMI) is currently testing a model to allow greater flexibility for an MA plan to meet the needs of chronically ill enrollees. CMS has also proposed a regulation that would permit MA plans to offer a benefit package that includes different cost-sharing requirements or benefits to help MA plans better serve the most vulnerable enrollees.

This section would expand the testing of the CMMI Value-Based Insurance Design (VBID) Model to allow an MA plan in any state to participate in the model by 2020 (during the testing phase) to determine whether savings are achieved without negatively impacting quality.

Section 50322. Expanding supplemental benefits to meet the needs of chronically ill Medicare Advantage enrollees. All Medicare Advantage (MA) plans must offer required Medicare benefits (except hospice) and may offer additional or supplemental benefits. Mandatory supplemental benefits are covered by the MA plan for every person enrolled in the plan and are paid for either through plan rebates, a beneficiary premium, or cost sharing. Optional supplemental benefits must be offered to all plan enrollees, but the enrollee may choose to pay an additional amount to receive coverage of the optional benefit; optional benefits cannot be financed through plan rebates.

An MA plan must adhere to specific rules regarding the supplemental benefits that it can offer. First, the MA plan cannot design a benefit plan that is likely to substantially discourage enrollment by certain MA eligible individuals. Further, supplemental benefits (a) may not be Medicare Part A or Part B required services, (b) must be primarily health related with the primary purpose to prevent, cure, or diminish an illness or injury, and (c) the plan must incur a cost when providing the benefit. Items that are primarily for comfort or are considered social services would not qualify as supplemental benefits. Examples of supplemental benefits include the following:

  1. Additional inpatient hospital days in an acute care or psychiatric facility,
  2. Acupuncture or alternative therapies,
  3. Counseling services,
  4. Fitness benefit,
  5. Enhanced disease management, and
  6. Remote Access Technologies (including Web/Phone based technologies).

CMS proposed a regulation that would allow MA plans greater flexibility to offer targeted supplemental benefits.

This section would allow an MA plan to offer a wider array of supplemental benefits to chronically ill enrollees beginning in 2020. These supplemental benefits would be required to have a reasonable expectation of improving or maintaining the health or overall function of the chronically-ill enrollee and would not be limited to primarily health related services. The section would allow an MA plan the flexibility to provide targeted supplemental benefits to specific chronically ill enrollees.

Section 50323. Increasing convenience for Medicare Advantage enrollees through telehealth. Telehealth is the use of electronic information and telecommunications technologies to support remote clinical health care, patient and professional health-related education, and other health care delivery functions. While Medicare beneficiaries may receive telehealth services in a variety of settings, under current law (SSA Section 1834(m)), the Medicare program recognizes and pays for only certain Part B telehealth services. These services must be either (1) remote patient and physician/professional face-to-face services delivered via a telecommunications system (e.g., live video conferencing), or (2) non face-to-face services that can be conducted either through live video conferencing or via store and forward telecommunication services in the case of any Federal telemedicine demonstration program in Alaska or Hawaii. Typically, Medicare coverage for remote face-to-face services includes payments (1) to physicians or other professionals (at the distant site) for the telehealth consultation, and (2) to the facility where the patient is located (the originating site).

An MA plan may provide basic telehealth benefits as part of the standard benefit; for example, telemonitoring and web-based and phone technologies can be used to provide telehealth services. Medicare Advantage Prescription Drug (MAPD) may choose to include telehealth services as part of their plan benefits, for instance, in providing medication therapy management (MTM). However, while there is nothing to preclude Medicare Advantage (MA) from providing telemedicine or other technologies that they believe promote efficiencies beyond what is covered in the traditional Medicare program, those services and technologies are not separately paid for by Medicare and plans must use their rebate dollars to pay for those services as a supplemental benefit.

This section would allow an MA plan to offer additional, clinically appropriate, telehealth benefits in its annual bid amount beyond the services that currently receive payment under Part B beginning in 2020. The Secretary would be required to solicit comments on: what types of telehealth services, including but not limited to those provided through supplemental health care benefits, such as remote patient monitoring, secure messaging, store and forward technologies, and other non-face-to-face communication; and the requirements for furnishing those benefits. If an MA plan provides access to a service via telehealth, the MA plan must also provide access to that service through an in-person visit, and the beneficiary would have the ability to decide whether or not to receive the service via telehealth.


Section 53112. Preventing the artificial inflation of star ratings after the consolidation of MA plans offered by the same organization. In recent years, CMS has encouraged MA organizations to consolidate their MA plans into fewer contracts. An unintended consequence of contract consolidation can be an artificial increase in star ratings, and therefore, quality bonus payments. Earlier this year, CMS proposed new rules related to how contract consolidations affect star ratings to more accurately reflect performance of the surviving and consumed contracts. This section would direct CMS to calculate a weighted average of star ratings across contracts that have been consolidated to more accurately reflect quality and mitigate unwarranted quality bonus payments.

[1] The summaries are provided in the Section-by-Section Summary of the Bipartisan Budget Act located at https://schrader.house.gov/uploadedfiles/summary_of_bipartisan_budget_act.pdf.



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