Officials at the Centers for Medicare & Medicaid Services (CMS) are telling health insurers to be more mindful of other players’ needs in the new final 2017 Medicare Advantage plan call letter package.
CMS needs cooperation from commercial health insurers to keep the Medicare Advantage plan and Medicare Part D prescription drug plan markets humming as the country heads toward the November presidential and congressional elections.
CMS also needs cooperation from commercial health insurers to maintain a strong supply of individual health insurance plans for both the off-exchange market and the Patient Protection and Affordable Care Act (PPACA) public exchange market.
Andy Slavitt, the acting CMS administrator, previously ran the Ingenix Consulting Inc. unit at UnitedHealth Group Inc. (NYSE:UNH), a major player in the Medicare Advantage, Medicare drug plan and Medicare supplement insurance policy markets.
But CMS officials have knocked down insurers’ and employers’ arguments in responses to industry efforts to change the way CMS is handling employer group waiver (EGWP) plans, or group Medicare Advantage plans, and the way CMS is fine-tuning the Medicare risk-adjustment program.
The Medicare Advantage program gives insurers a chance to use Medicare program payments to provide plans that serve as an alternative to traditional Medicare coverage.
CMS originally proposed replacing the current group Medicare Advantage plan subsidy amounts with those based on the individual market bidding process.
Insurers, employers and industry groups blasted the proposal, arguing that EGWP enrollees are more likely to live in rural and small-city areas with high health care costs and limited access to health care providers than members of Medicare Advantage plans, and that group plan enrollees generally tend to have higher costs than individual policyholders.
CMS has agreed to ease up, and to phase in the change over two years.
But, in responses to industry commenters on the EGWP controversy, CMS officials note that statutes give CMS the authority to require that each employer submits its plan benefit package and bids to CMS for review.