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Date ArticleType
4/4/2017 Payment/Reimbursement
CMS Issues Medicare Advantage Final Announcement and Call Letter

On Monday, the Centers for Medicare & Medicaid Services (CMS) published the Announcement of Calendar Year (CY) 2018 Medicare Advantage Capitation Rates and Medicare Advantage and Part D Payment Policies and Final Call Letter. This document updates Medicare Advantage (MA) and Part D plan payment rates and sets forth policy changes that will determine how MA and Part D plans are regulated in 2018. The Announcement finalizes several payment and policy changes proposed in the 2018 Advance Notice and Draft Call Letter for MA and Part D plans, and addresses stakeholder comments submitted in response to CMS' proposals. For additional information, please refer to AHCA's summary of the 2018 Advance Notice and Draft Call Letter and comments submitted on those provisions most pertinent to SNFs.

Highlights of the 2018 Announcement and Final Call Letter include: 

• Payment rates for MA plans will increase by 0.45 percent on average in 2018, according to the Announcement, which is slightly higher than the 0.25 percent increase estimated in the Advance Notice. When factoring in MA coding trends, the MA plans are expected to experience an average increase of 2.95 percent.
• CMS did not finalize the proposal to reduce the cost sharing limit for SNF days 1-20 from $20 per day to $0 per day for CY 2018 MA plans that use a voluntary maximum out-of-pocket (MOOP) limit. CMS indicates that in addition to the comments received in support of the proposal to finalize the change to ensure MA cost sharing aligns with cost sharing in original Medicare, they also received comments encouraging flexibility in applying cost sharing to SNF during the first 20 days as in CY 2017. CMS ultimately decided to maintain the same SNF cost sharing limit permitted in CY 2017 for these plans. 
• In the draft Call Letter, CMS sought stakeholder comment on whether MA special needs plan (SNP) should differ from non-SNP MA plan networks. In the final Call Letter, CMS indicated they will move forward on developing SNP specific network adequacy evaluations.
• CMS is slowing the transition to encounter data-based risk scores. CMS had proposed using blended risk scores from the Risk Adjustment Processing System/FFS and the Encounter Data System (EDS) using weights of 75% and 25%, respectively, as they had done in in 2017. In response to stakeholder input raising concerns about the accuracy and operational issues associated with encounter data collection, CMS will use a risk score blend of 85% FFS data and 15% EDS in 2018.
• As an attachment to the Final Rate Announcement and Call Letter, CMS issued a Request for Information (RFI) requesting recommendations from stakeholders and the public for regulatory, sub-regulatory, policy, practice, and procedural changes to achieve the goals of transparency, flexibility, program simplification and innovation. CMS is accepting feedback through April 24, 2017 at PartCDcomments@cms.hhs.gov.

AHCA will review the Final Announcement and Call Letter in its entirety and will keep you informed of any key changes from CMS' initial proposals that may impact SNFs. AHCA will continue to monitor any developments and will keep you apprised of any additional announcements. Please contact Narda Ipakchi with any questions.