Our take: Medicare enacts new opioid limits, MA rates

CMS on Monday finalized changes to Medicare Advantage (MA) and Medicare Part D payment policies for 2019 that set new pharmacy limits for Medicare Part D beneficiaries deemed at risk of opioid misuse and increase MA plan payments by 3.4%.

April 30 webconference: How to develop a comprehensive opioid response strategy

Part D updates

CMS' Part D updates included new policies designed to reduce opioid misuse and lower beneficiaries' prescription drug costs.

Read Advisory Board's take on the new opioid polices.

For instance, CMS said it will require Part D plans to implement a "hard" point of sale opioid safety edit that limits initial prescriptions to a 7-day supply. CMS declined to set a daily dose maximum, noting that commenters were unable to reach a consensus on such a proposal.

CMS under the Comprehensive Addiction and Recovery Act said it will allow Part D plans to implement drug management programs for patients considered at risk for opioid misuse. Under the program, Part D plans will be able to limit such beneficiaries to select pharmacies or prescribers through a so-called "lock-in" policy. The agency said it also expects Part D plans to set "soft" point of sale opioid safety edits that alert the pharmacist if the patient is taking another opioid.

CMS said the new opioid policies will not affect beneficiaries who are receiving opioids for cancer-related pain or palliative and end-of-life care, nor those who are in hospice or long-term drug management programs.

In addition, CMS said it is moving forward with two policies intended to reduce Part D costs. CMS gave Part D plans more authority to substitute generics for brand name drugs on the same or lower cost-sharing tier. Further, the agency will calculate out-of-pocket costs for biosimilars in the same way such costs are determined for generics. CMS projected that applying the low-income cost-sharing to biosimilars would save Medicare $10 million in 2019.

However, CMS did not finalize a proposal to apply at the point of sale certain Medicare Part D rebates and discounts that typically are negotiated behind the scenes by manufacturers, pharmacists, and insurers. The agency said it is still evaluating stakeholder comments.

Advisory Board's take

by Rebecca Tyrrell and Colleen Keenan, Pharmacy Executive Forum and Gillian Michaelson, Health Care Advisory Board

There are three main ways that CMS' finalized opioid use policies for Part D acknowledge the critical need to segment patients to effectively tailor pain management interventions.

1. Guidelines for treating chronic pain and opioid-naïve patients. Most noteworthy is the new guidance specifically for treating opioid-naïve patients. CDC's 2016 guidelines, which many health systems are working to implement, focus only on opioid prescriptions for chronic pain. Critically, CMS' new, more targeted guidelines acknowledge the increased risk of abuse for opioid-naïve patients (6-8% of opioid-naïve patients undergoing non-cancer procedures develop new, persistent opioid abuse) and the need to establish clear and consistent guidelines for each population.

These new safety edits and alerts should serve as specific guidelines for clinicians and as a means to prompt much-needed and recurring conversations between prescribers and patients about opioid risks, appropriate pain management expectations, and individual patient needs and preferences.

2. Exceptions for certain patients. Also of note, and in accordance with the existing CDC guidelines, is that CMS' new opioid limits do not apply to patients who are in hospice care or long-term care, receiving end-of-life care or palliative care, or are being treated for active cancer-related pain. Given how early most hospitals and health systems are in revisiting opioid use guidelines, this exclusion is a helpful mechanism for ensuring patients do not lose access to a critical means of managing their pain.

However, just because CMS carves out these groups does not mean health systems should stop looking for opportunities to optimize opioid regimens for these populations. Health systems should continue to revisit opioid prescribing guidelines for these complex patients, incorporating any emerging evidence and lessons learned from previous opioid stewardship initiatives.

3. Not limiting access to medication-assisted treatment. Additionally, CMS specifically clarifies that these guidelines are not intended to limit patient access to opioids used for medication-assisted treatment (MAT). This provides both a continued endorsement of MAT as an important aspect of providers' addiction prevention programs and as a reminder that those already suffering from opioid addiction are another specific patient population to consider when developing optimal opioid prescribing protocols.  

For more on how providers should play a role in addressing the opioid epidemic, download our research report, which outlines three imperatives to guide hospitals and health systems in their efforts to reduce the impact of inappropriate opioid prescribing and misuse.

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Next week, we will also be releasing new resources on how health system executives can best combat the opioid crisis.


MA updates

Read Advisory Board's take on the MA plan payments.

CMS said the 3.4% MA payment bump, which is nearly double the 1.8% increase that the agency had proposed earlier this year, reflects a higher-than-expected medical cost growth projection for 2019 and a 2.26% decline in payments under an Affordable Care Act provision intended to align MA's and fee-for-service Medicare's payment  structures.

CMS also said it will move forward with plans to increase its weighting of encounter data it uses to set payments for MA plans. CMS historically has relied on data from the Risk Adjustment Processing System (RAPS) to calculate the payments. In 2016, the agency began using a blend of encounter data from MA organizations and patient records submitted to RAPS. The percentage of encounter data for 2018 was set at 15%. For 2019, CMS proposed raising the percentage of encounter data to 25%. Industry stakeholders, including America's Health Insurance Plans and the American Hospital Association, had criticized the proposal, saying the data are often inaccurate.

CMS also added new conditions to the RAPS model, including chronic kidney disease conditions, mental health, and substance use disorder.

In addition, CMS in 2019 will expand the health-related supplemental benefits MA insurers can cover to include products such as portable wheelchair ramps and non-skilled in-home supports. CMS said insurers will be able to offer such coverage if the benefits compensate for physical impairments, ease the effects of injuries or health conditions, or reduce avoidable emergency department use.

CMS also finalized proposals to eliminate requirements that insurers show their plans are "substantially different" from others they offer in the same county in terms of benefits, cost-sharing, and premiums, and revise the way that medical loss ratio calculations treat "fraud reduction activities."

As required under the 21st Century Cures Act, CMS also will replace the current MA disenrollment period that runs from Jan. 1 to Feb. 14, during which beneficiaries can switch from an MA plan to traditional Medicare, with a new open enrollment period that will run from Jan. 1 to March 31 beginning in 2019 (Dickson, Modern Healthcare, 4/2; Morse, Healthcare Finance News, 4/2; Slabodkin, Health Data Management, 4/3; Swetlitz, STAT News, 4/2; Berkrot/Humer, Reuters, 4/2; CMS release, 4/2; CMS fact sheet, 4/3).

Advisory Board's take

by Rachel Sokol, Health Plan Advisory Council and Sandra Agik , Health Care Strategic Research

The 3.4% average payment bump is good news for insurers, many of whom have placed huge bets on MA in the past several months. But it also means that insurers should expect to face increased competition, as more plans will seek aggressively to expand their MA business. Anthem already has announced plans to acquire America's 1st Choice and Healthsun, for instance, while Centene is seeking to expand its MA offerings in four states under its Allwell brand.

Plans must work even harder to offer a competitive product that drives high retention rates. They also must prioritize provider and member engagement strategies to achieve high star ratings, as these ratings create a guaranteed opportunity to capture revenue through bonus payments.

Finally, the stakes are getting higher for plans to ensure that they're submitting complete and accurate clinical data for their beneficiaries. As MA raises its weighting on this data in its payment calculations, plans will need to incentivize providers and provide ongoing support to ensure that they submit high-quality data.

April 30 webcon: How to develop a comprehensive opioid response strategy

As the opioid crisis continues to worsen across the country, the provider community sits under a national spotlight with the federal government, states, and patients expecting hospital and health systems to take the lead in solving this epidemic.

Join our experts on Monday, April 30 to learn how to establish a comprehensive, proactive approach to combating the opioid crisis and get the 29 key performance indicators that will help you track your progress in this ongoing effort.

Register Now


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