April 06, 2023

Key Provisions and Clarifications in MA, Part D and PACE Final Rule

The final rule for the Medicare Advantage (Part C), Medicare Prescription Drug Benefit (Part D), Medicare cost plan, and Programs of All-Inclusive Care for the Elderly (PACE) was released April 5. The proposed rule was large and wide-ranging and may be finalized in phases by Centers for Medicare & Medicaid Services (CMS). The rule contains provisions on utilization management/prior authorization (PA), ensuring plans cover traditional Medicare A and B benefits, and many of the changes place limits on how plans market to beneficiaries, MA plan star ratings, Health Equity, and behavioral health access. 

Of greatest interest to members are the sections that focus on ensuring beneficiaries’ access to basic Medicare A and B benefits through their MA plans, and changes to MA plan PA practices. CMS codifies and clarifies that MA plans cannot be more restrictive in covering traditional Medicare benefits than Medicare FFS. However, the rule preserves the plans’ right to waive the 3-day stay. CMS will permit plans to use their own internal criteria for making coverage decisions, but only where the criteria are not “fully established.” CMS does define those circumstances and the type of evidence that a plan must use for those determinations. The rule also places limits on when plans can use algorithms such as NaviHealth’s nhPredict.

CMS finalized its changes to PAs to streamline the process, ensure continuity of care when the enrollee changes plans and clarify the duration for which PAs must apply. Under the final rule, PAs:

  • Can only be used for confirming patient diagnosis and/or medical necessity of the services.
  • Are valid for a “course of treatment.” CMS further clarifies this means “as long as medically reasonable and necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient’s medical history and the treating provider’s recommendation.”

LeadingAge asked for further clarification on the “course of treatment” definition to ensure its applicability to services provided by Skilled Nursing Facilities and Home Health Agencies. The final language could significantly impact the number of reauthorizations PAC providers will need to submit for an episode of care and instead authorize a plan of care.

The final rule also finalized five of the previously proposed sections for PACE programs with little amendment including codifying changes to the initial contract year (§ 460.6), imposition of CMPs (§ 460.40), requirements for contracted specialists (§ 460.70), allowance of oral service determination request extensions (§ 460.121), and maintenance of records (§§ 460.200 and 460.210).

The rule is effective June 5, 2023, with most provisions affecting MA plan practices in CY2024 and beyond. LeadingAge staff will finish reviewing the 700+ page rule in detail and provide a more detailed analysis in the coming days.

View the fact sheet for more information.