Federal regulators have agreed to let trained agents and brokers market Programs of All-Inclusive Care for the Elderly, or PACE programs.
The Centers for Medicare and Medicaid Services (CMS) has included that provision in a new set of final PACE program regulations. The regulations are set to appear in the Federal Register, an official government publication, June 3.
Traditionally, Medicaid has paid for nursing home care for poor people, and for some other people who meet state Medicaid nursing home benefits eligibility rules. Federal rules have prohibited Medicare plans from covering long-term care (LTC) services.
A PACE program can provide comprehensive, community-based care for people ages 55 and older, including Medicare enrollees, who can live safely in the community but who already have disabilities, or enough frailty, to make them eligible for Medicaid nursing home care benefits.
A PACE program is supposed to provide primary medical care, specialty care, nursing care, unavoidable hospital care, home care, social support services, transportation services, and any other services needed to keep enrollees as healthy as possibility.
Medicare and Medicaid pay all of the bills for some enrollees, but some enrollees pay at least part of the premiums themselves.
PACE plan enrollees give up ordinary Medicare and Medicaid coverage when they enroll in the plans, but they can get that coverage back if they cancel their PACE coverage.
Some consumers like the convenience of having one PACE organization agree to take responsibility for providing, and coordinating, all of their care. Some dislike the idea of having to depend on one organization to decide what type of care is necessary, and how to provide it.
CMS published the original PACE program regulations in 2006. Today, there about 100 PACE organizations in 31 states. Those organizations have only about 45,000 enrollees. In theory, CMS could use PACE organizations as a model for creating a large-scale public LTC benefits program for Americans who are not eligible for Medicaid nursing home benefits.
Here are seven things for financial professionals to know about the new final PACE program regulations.
The regulations are set to take effect 60 days after the official June 3 Federal Register publication date.
A preliminary version of the final regulation packet lists Brandy Alston as the CMS contact person for the regulations.
CMS posted the draft version of the regulations in September 2016 and received about 110 public comments.
2. Agents and Brokers
Some PACE organizations have been working with outside agents, brokers and marketing organizations to reach out to potential enrollees.
Originally, CMS was going to prohibit PACE organizations from working with non-employee agents and marketing organizations, because of concerns that outside marketers might not give potential enrollees, and their caregivers, enough information about the consequences of having to get all care from the providers in the PACE plan’s provider network.
Two commenters agreed with the idea of banning use of outside marketers. “One such commenter expressed concern with fraud, confusion, and abuse with marketing by non-employees,” according to CMS officials’ introduction to the final regulations.
But several commenters said CMS should let PACE organizers use outside marketers.
CMS officials say in the introduction to the final regulations that they have decided to let PACE organizations use outside individuals and entities to help with marketing, if the non-employee marketers receive appropriate training, such as training on PACE program participant rights, enrollment rules and disenrollment rules.
PACE organizations must take responsibility for the activities of the non-employee marketers, and they must develop a method to document training for non-employee marketers, officials say.
3. Caps and Pens
CMS has also prohibited PACE organizations from using cash rebates or similar incentives to attract enrollees, but it has always let the organizations use “gifts of a nominal value” to attract enrollees’ attention, and give them something with the organization’s contact information on it.
In the new regulations, CMS has given more detailed rules.
The gifts can have a retail value up to $15,
A PACE marketer can give a prospective PACE plan enrollee the same kind of pen, or key chain flashlight, with a logo on it that a Medicare Part D drug plan marketer could provide.
4. For-Profit Providers
Originally, the law that authorized the birth of the PACE program limited participation to nonprofit organizations, but the law let CMS waive that rule for for-profit organizations that would participate in a pilot program. Under the law, CMS could let for-profit organizations become PACE providers if the for-profit organizations in the pilot program performed well.
Not many for-profit organizations have sponsored PACE plans, but the for-profit sponsors have been similar to the nonprofit plan providers, and CMS will now let for-profit organizations provide PACE plans, officials say.
5. Provider Deals
In the past, a PACE organization that went through a change in control could give CMS just 14 days’ notice about the change.
CMS will now require a PACE organization to provide at least 60 days’ notice.
6. Dumping Sick Enrollees
One concern about any health care provider that receives a flat payment for soup-to-nuts care is that the provider will skimp on care.
CMS reports in the introduction to the new regulations, in a discussion of a new set of disenrollment rules, that some PACE organizations have tried to hold their costs down by ejecting enrollees with expensive care needs.
“Through record review during on-site audits and follow-up regarding family or participant grievances and complaints, we have encountered some instances in which a participant needed additional services and was encouraged to voluntarily disenroll by either an employee or a contractor of the PO [PACE organization] in an effort to reduce costs for the PO,” officials write. “To help prevent this practice, we proposed to affirmatively require … that POs ensure their employees or contractors do not engage in any practice that would reasonably be expected to have the effect of steering or encouraging disenrollment of PACE participants due to a change in health status.”
If a PACE organization tries to push sicker enrollees out, the organization would be subject to sanctions for discriminating on the basis of an individual’s health status or need for health care services, officials say.
7. Dumping Enrollees With Awful Caregivers
CMS officials also acknowledge that some PACE plan enrollees have spouses, adult children or other caregivers who are so abusive that the plans must push the enrollees out.
The new final regulations include rules allowing a plan to disenroll an enrollee involuntarily if “a participant’s caregiver engages in disruptive or threatening behavior that jeopardizes the participant’s health or safety, or the safety of the caregiver or others.”
In that kind of a situation, a PACE organization should try to make sure the ejected enrollee has other care arrangements, if that’s possible, officials say.
If a PACE organization ejects an enrollee because the caregiver is disruptive or threatening, it should also “take appropriate action in a manner consistent with the legal requirements applicable to the jurisdictions in which it operates, including state laws relating to mandatory reporting of elder abuse, whenever abuse or neglect of a participant may have occurred,” officials say.
A copy of the new final PACE regulations is available here.
— Read All-in-One Medicare Plans May Open to Younger People, on ThinkAdvisor.