CMS Proposes 0.93% Pay Rate Hike for MA Plans in 2021

The rate hike is part of a broader package of proposed "refinements" for Medicare Advantage and the Part D Quality Star Rating system.

Baseline payment rates for Medicare Advantage plans will increase by 0.93% – about one-third the 2.53% increase the plans got this year – under a proposal unveiled this week by the Centers for Medicare & Medicaid Services.

The rate hike is part of a broader package of proposed "refinements" for Medicare Advantage and the Part D Quality Star Rating system under the Patients Over Paperwork initiative that CMS says will provide greater flexibility for payers and Part D plan sponsors to design plans, improve transparency in drug pricing, and which could save the federal government $4.4 billion over the next decade.

"Whether you're a senior dealing with kidney disease, living in a rural area, facing high costs because you need a specialty drug, or just want a better sense of what you'll owe for prescription drugs, these new CMS proposals will improve your Medicare experience," Health and Human Services Secretary Alex Azar said in a media release.

Stakeholders will have until March 6 to comment on the proposal.

Among other things, the proposed rule offers guidelines on enrollment in Medicare Advantage plans for beneficiaries with end-stage renal disease, who will be eligible beginning in 2021.

"By removing the barrier that beneficiaries with ESRD now face in terms of enrolling in MA plans, we are empowering them to choose the type of Medicare coverage that best meets their needs," CMS said.  

CMS said its tweaking the Star Ratings to reduce the influence of outliers on cut points.

"We also propose to further increase measure weights for patient experience/complaints and access measures from 2 to 4, reflecting CMS's commitment to put patients first and to empower patients to work with their doctors to make healthcare decisions that are best for them," CMS said.

At the request of pharmacy benefits managers, CMS is also proposing the creation of a "preferred specialty tier" option that would encourage the use of cheaper drugs, reduce the out-of-pocket costs for beneficiaries, and save money for the federal government.  

"In addition to giving those with kidney disease more choices, today's proposals shed desperately needed light on previously obscured out-of-pocket costs for prescription drugs," said CMS Administrator Seema Verma. "At the same time, it strengthens plans' negotiating power with prescription drug manufacturers so American patients can get a better deal."

Matt Eyles, president and CEO of America's Health Insurance Plans, said he was "encouraged" by the flexibility that would allow payers to "tailor benefits, design high-quality provider networks, and continue to innovate."

"However, we are concerned that some proposals could undermine the critical funding that protects millions of Americans' access to the benefits and care they need, including individuals with kidney disease who are newly eligible to enroll in Medicare Advantage," he said.

"We will continue to review the advance rate notice and proposed rule, and we look forward to sharing important feedback with CMS during the comment period," he said.