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Life Health > Health Insurance > Medicare Planning

Feds Lift Ban on New Cigna Medicare Drug Plan Sales

By Allison Bell

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Officials at the Centers for Medicare and Medicaid Services are letting Cigna Corp. return to selling new Medicare drug coverage immediately.

Vikki Ahern, head of the CMS division that oversees private Medicare plans, announced the decision today, in a letter addressed to a Cigna executive and posted on the CMS website.

CMS shut Cigna’s Cigna-HealthSpring unit out of the Medicare drug market in January 2016.

(Related: Cigna Banned From Medicare Sales for ‘Systemic Failures’)

CMS said at the time that it was punishing Cigna-HealthSpring because it found serious problems with how the unit was choosing the drugs it covered, and how it handled enrollee complaints.

Cigna told CMS, in documents filed in March and April, that it has corrected the problems.

An independent auditor hired by Cigna conducted a validation audit, Ahern writes in the letter announcing the ruling.

“Based on the results of the validation audit, CMS has determined that Cigna’s deficiencies have been sufficiently corrected,” Ahern writes.

Cigna will have to work with CMS to correct some problems found in 2015, during the audit that led to the January 2016 sanctions, and it will also have to address some new problems found during the validation audit, Ahern says.

To ensure that Cigna has corrected the problems that triggered the January 2016 sanctions, CMS will conduct targeted monitoring for up to one year, Ahern writes.

Cigna has been a major player in the Medicare Advantage drug plan market and the market for stand-alone Medicare Part D prescription drug plans.

The company ended the first quarter with 853,000 Medicare drug plan enrollees, according to an earnings report supplement. Enrollment was down from 1.1 million in early 2016, when the sales and marketing ban started.

Cigna has a 3.4% share of the Medicare drug plan market, and it ranks eighth in terms of market share, according to Mark Farrah Associates.

— Read Feds to Keep Cigna on Medicare Plan Sidelines in 2017 on ThinkAdvisor.

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