CMS Announces Higher Medicare Advantage, Part D Rate Hikes

The Centers for Medicare and Medicaid Services (CMS) recently released final rate updates to its Medicare Advantage and Part D Prescriptions Drug Programs for 2018, increasing the reimbursement rate for insurers.  

“Medicare is committed to strengthening Medicare Advantage and the Prescription Drug Program by supporting flexibility and efficiency,” Seema Verma, MPH, CMS administrator, said in a press release. “These programs have been successful in allowing innovative approaches that give Medicare enrollees options that best fit their individual health needs.”

According to CMS, the final policies are similar to updates that were proposed in February, however, the updated policies include several changes that were received during the public comment period and the rate hike is larger than previously proposed. CMS boosted the reimbursement rate by 0.45%. The plans that will see growth in coding acuity, should expect a total change of 2.95% in revenue. Additionally, CMS noted that plans that improve the quality of care for enrollees will see higher reimbursement and will be able to grow and enhance the benefits they offer to enrollees. 

The higher reimbursement rates, which will benefit insurance companies, were well-received within the industry. 

“Medicare Advantage works. It consistently offers more affordable choices and brings innovative, quality, and coordinated care to 18.5 million Americans—nearly one-third of Medicare beneficiaries,” Marilyn Tavenner, CEO of America’s Health Insurance Plans, said in a press release. “That’s why close to 350 members of Congress came together across the aisle to voice their concern about potential cuts, and to protect Medicare Advantage benefits that continue to deliver value. We appreciate their support for this program, which is so important to our nation’s seniors.”

Additionally, CMS announced it is finalizing policies that will help tackle opioid overutilization. The policies will encourage safeguards before an opioid prescription is dispensed at a pharmacy, while preserving flexibility that will maintain access to needed medications for Medicare enrollees in the Part D prescription drug program. —Julie Mazurkiewicz