The federal agency will likely claim back billions of dollars in overpayments from health insurers that operate Medicare Advantage plans.
Payer organizations have expressed their disappointment for the Medicare Advantage Risk Adjustment Data Validation (RADV) final rule released by CMS, claiming the auditing standards will have the "potential unintended consequence" of harming beneficiaries.
The rule, which will allow the federal agency to collect billions of dollars in overpayments, eliminates the fee-for-service adjuster in RADV audits, a method to assess for a permissible level of payment errors.
However, the rule will only apply to audit findings beginning with the payment year 2018, rather than 2011 as previously proposed, absolving payers of significantly more in overpayments.
"CMS has a responsibility to recover overpayments across all of its programs, and improper payments made to Medicare Advantage plans are no exception," HHS secretary Xavier Becerra said in a statement. "For years, federal watchdogs and outside experts have identified the Medicare Advantage program as one of the top management and performance challenges facing HHS, and today we are taking long overdue steps to conduct audits and recoup funds."
Health insurer groups have bristled at the rule, insisting that it will raise costs for plan members and limit their access to care.
Matt Eyles, president and CEO of AHIP, stated: "Our view remains unchanged: This rule is unlawful and fatally flawed, and it should have been withdrawn instead of finalized. The rule will hurt seniors, reduce health equity, and discriminate against those who need care the most. Further, the rule would raise prices for seniors and taxpayers, reduce benefits for those who choose MA, and yield fewer plan options in the future."
Mary Beth Donahue, president and CEO of Better Medicare Alliance, a Medicare Advantage advocacy group, echoed the sentiment.
"While our review of the rule is ongoing, we are focused on the potential unintended consequence of creating an environment of higher premiums and fewer benefits for the more than 29 million seniors and people with disabilities who choose Medicare Advantage," Donahue said.
Meanwhile, David Merrit. Blue Cross Blue Shield Association senior vice president of policy and advocacy, stated: "CMS should have implemented a narrower solution aimed at a few bad actors, but instead this overreaching regulation will raise costs, reduce choice and make it more difficult for seniors and those with disabilities to effectively manage their health."
Jay Asser is the contributing editor for strategy at HealthLeaders.
KEY TAKEAWAYS
CMS released its Medicare Advantage Risk Adjustment Data Validation final rule to collect overpayments from health plans beginning from 2018.
Payer groups like AHIP, Better Medicare Alliance, and Blue Cross Blue Shield Association have reacted to the rule with displeasure, arguing that the rule will have the downstream effect of hurting seniors' care.