Healthcare Law Blog

CMS 2014 Call Letter: A Bright Future for CMS Star Rating System

On February 15, the Centers for Medicare & Medicaid Services (CMS) issued the draft calendar year (CY) 2014 Call Letter for the Medicare Advantage (MA) and Part D programs (Call Letter). It contains information that MA organizations and Part D plan sponsors (collectively, Plan Sponsors) need to prepare their 2014 bids and operations.

Star Ratings Shine Brighter with Refinements

The Call Letter describes refinements to the star rating system based on feedback to CMS' November 2012 request for comments. The Call Letter explains that although CMS is proposing changes to methodologies for existing star rating categories based on comments received, there will be no new star rating categories for 2014 ratings.

CMS describes five refinements to existing star rating categories:

• CMS proposes to extend the current "hold harmless" provision for the Quality Improvement star rating category. Currently, Plan Sponsors with overall ratings of four or more stars for two years are held harmless under the Quality Improvement star rating category if the overall rating decreases with the addition of new or modified measures between measuring years. CMS proposes to extend this policy to plans with five stars for an individual category. Thus, if a Plan Sponsor with a five-star rating for a particular category for two years experiences a decline because of a change to the measure, that measure will be excluded from the Plan Sponsor's improvement measure calculation. The excluded star rating category will, however, be available to count toward the Plan Sponsor's minimum categories needed to qualify for the improvement measure. Improvement scores of zero (no net change on eligible categories) will receive three stars for the improvement measure.

• For the High-Risk Medication Use star rating category, CMS will measure the percentage of Part D enrollees ages 65 or older who received two or more fills for the same high-risk drug. Existing measures focus on two or more fills for the same active ingredient. CMS confirmed that it expects to exclude this measure from the improvement measure due to the continuous changes to this measure.

• CMS will begin using standard rounding rules to round star rating scores for each category to whole numbers, except the Complaints category (which will be rounded to two decimal points), Improvements category (rounded to three decimal points), and the Part D Appeals Auto-forward category (rounded to one decimal point).

• CMS will add two new drugs to the Medication Adherence for Diabetes Medications star rating category and revise the name to remove reference to "Part D."

• For Puerto Rico Plans, CMS will refine the call center foreign language requirements to include a measure for English as a foreign language in the relevant metric in recognition of Spanish as the predominate language.

Star Ratings to Reach New Heights

The Call Letter confirms CMS' intent to maintain existing four-star thresholds for various categories (category weight also remains unchanged), and establish four-star thresholds for categories that have been rated for at least two years.

In looking ahead to 2015 ratings, CMS announced that six categories will be subject to a 2% increase in the four-star rating threshold, including Cardiovascular Care, Controlling Blood Pressure, and Diabetes Treatment. CMS also indicated that it may adopt other star rating changes, including new star ratings categories and changes to existing categories. In addition, low-enrollment plans will be included in the star rating program.

A note on Hurricane Sandy--CMS acknowledged in the Call Letter that plan star ratings may have been affected by Hurricane Sandy. Plan Sponsors have until February 28 to contact CMS with concerns.

Continuity of Operations and Other Proposals

CMS requests comments regarding several potential policy changes, including rulemaking to establish continuity of operations requirements for essential functions, such as systems security and availability, chain of command, and a 12-hour timeline to restore operational capability. CMS said that establishing minimum requirements may become a priority because of shortcomings revealed during Hurricane Sandy. Additionally, CMS intends to propose rules for CY 2015 that address agent/broker compensation requirements, including allowing Plan Sponsors to pay renewal compensation amounts beyond the current six-year cycle.

Save the Date

The Call Letter sets out the CY 2014 calendar, including identifying the April 1 release of the Announcement of CY 2014 payment rates and final call letter. The Part D formulary submission window will be later this

year--May 13-31--but the summer formulary update opportunity will also be more limited. The bid submission deadline is June 3.

This article is intended as a summary of federal or state law and does not constitute legal advice.

**This information was original published as an email alert jointly issued by the American Health Lawyers Association Payors, Plans, and Managed Care Practice Group and the Medicare Advantage and Part D Affinity Group.  The original email alert is the second in a series of four email alerts that will be published regarding the recent release of the Centers for Medicare & Medicaid Services' Proposed Rule implementing the Affordable Care Act's Medical Loss Ratio requirement for Medicare Advantage and Part D Plans and the 2014 Advance Notice and draft Call Letter.  Please see healthlawyers.org for more information.

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This article does not constitute legal advice.