2023-07115.pdf

used for supplemental benefits is consistent with longstanding guidance in Chapter 4, section 30.2, of the MMCM (and also stated in the CY 2021 Final Rule [86 FR 5864]) that supplemental benefits must be medically necessary. Special Supplemental Benefits for the Chronically Ill (SSBCI) may be non- primarily health related so a standard based on medical necessity may not always be appropriate. Regular supplemental benefits must be medically necessary, but SSBCI need to have a reasonable expectation of improving or maintaining the health or overall function of the enrollee as required at  422.102(f)(1)(ii) and discussed in CY 2020 Final Rule (85 FR 33796). To illustrate how these proposed prior authorization policies would work, we discussed an example regarding coverage of acupuncture. Traditional Medicare currently has an NCD for Acupuncture for Chronic Lower Back Pain (cLBP).105This NCD authorizes acupuncture for Medicare patients with chronic Lower Back Pain (cLBP) for up to 12 visits in 90 days under the following circumstance: lasting 12 weeks or longer; nonspecific, in that it has no identifiable systemic cause (that is, not associated with metastatic, inflammatory, infectious disease, etc.); not associated with surgery; and not associated with pregnancy. Here, an MA plan may require prior authorization, before authorizing treatment as a covered basic benefit, to verify the patients pain is not the result of metastatic, inflammatory, infectious disease, as specified in the NCD. In this example, the plan is using the prior authorization to confirm a diagnosis specified in appropriate Medicare Part B coverage policy (in this case an NCD). Hence, prior authorization is used in this case to confirm the appropriate use of clinical standards in order to verify that Traditional Medicare coverage criteria are met, thus ensuring appropriate care, which is acceptable. CMS guidance (section 10.16 of Chapter 4 of the MMCM) currently states that if the plan approved the furnishing of a service through an advance determination of coverage, it may not deny coverage later on the basis of a lack of medical necessity. This means that when an enrollee or provider requests a pre-service determination and the plan approves this pre-service determination of coverage, the plan cannot later deny coverage or payment of this approval based on medical necessity. The only exception here would be medical necessity determinations for which the plan has the authority to reopen the decision for good cause or fraud or similar fault per the reopening provisions at  422.616. This has been longstanding sub- regulatory guidance (section 10.16 of Chapter 4) that we proposed to codify at  422.138(c) to ensure the reliability of an MA organizations pre-service medical necessity determination. Therefore, we did not believe there was any additional impact on MA organizations caused by the proposal to codify this at proposed  422.138(c) and we solicited stakeholder input on the reasonableness of this assumption. We also solicited comment whether combining all of our proposals on prior authorization (here and in section III.E.4 of this proposed rule discussing proposed changes to  422.112(b)(8)) in proposed new  422.138 would make applying and understanding these requirements clearer for the public and MA organizations. Finally, we also reminded MA plans that section 1852(b) of the Act states that an MA plan may not deny, limit, or condition the coverage or provision of benefits under this part, for individuals permitted to be enrolled with the organization under this part, based on any health status-related factor described in section 2702(a)(1) of the Public Health Service Act. Additionally, per CMS regulations at  422.100(f)(2), plan benefit designs may not discriminate against beneficiaries, promote discrimination, discourage enrollment or encourage disenrollment, steer subsets of Medicare beneficiaries to particular MA plans, or inhibit access to services. We consider prior authorization processes to be part of the plan benefit design, and therefore such processes cannot be used to discriminate or direct enrollees away from certain types of services. We explained that a complete estimation of impact from proposed  422.138(a) and (b) cannot be given because we would need detailed knowledge of proprietary plan information on the frequency and specific services for which prior authorization is done in each plan. (As noted in a prior paragraph, proposed  422.138(c) would only codify existing guidance to MA organizations.) We solicited comment from stakeholders on the impact and any additional information that would assist CMS in making an estimation. Some commenters stated that publicly posting a summary of evidence considered during the development of the criteria would require significant administrative effort. However, we did not receive specific comments on our estimates. The stakeholder comments of increased administrative burden are consistent with our statements in the proposed VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00082 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222201 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations rule, that due to its complexity and many unknowns we cannot quantify the burden. We thank commenters for helping inform CMSs policy on the appropriate use of prior authorization and the requirements proposed at  422.138. We summarize the comments and our responses follow. Comment: Some commenters asserted that this proposed rule goes against sections 1852(c)(1)(G) and (c)(2)(B) of the Act, and the MA regulations at  422.4(a)(1)(ii) which reference a MA plans application of utilization management tools, like prior authorization and other procedures used by the organization to control utilization of services and expenditures. Other commenters expressed concern that limiting prior authorization will lead to redundant, unnecessary, and inappropriate care. Response: In the proposed rule, we acknowledged that utilization management tools, including prior authorization, are expressly referenced at section 1852(c)(1)(G) and (c)(2)(B) of the Act, as part of the disclosure obligations of MA organizations. We also stated that section 1852(g)(1)(A) of the Act states that MA organizations shall have a procedure for making determinations regarding whether an enrollee is entitled to receive a health care service and that such determinations must be made on a timely basis; that provision applies to both prior authorization determinations and to post-service decisions about coverage and payment. We proposed at  422.138(a) that coordinated care plans may use prior authorization processes for basic benefits and supplemental benefits, to ensure basic benefits are medically necessary based on standards specified in  422.101(c)(1), or to ensure that the furnishing of supplemental benefits is clinically appropriate. Thus, under our proposal and as finalized here, coordinated care plans are still permitted to use prior authorization as a utilization management tool. However, the use of prior authorization is subject to a number of new limitations, which we proposed to ensure that MA enrollees receive the Part A and Part B benefits to which they are entitled. We proposed, and are finalizing, at  422.138(b)(1) through (3) that coordinated care plans may use prior authorization processes only to confirm the presence of diagnoses or other medical criteria that are the basis for coverage determinations for the specific item or service, to ensure basic benefits are medically necessary based on standards specified in  422.101(c)(1), or to ensure that the furnishing of supplemental benefits is clinically appropriate. With regards to supplemental benefits at  422.138(b)(3), we state that MA organizations may use prior authorization to ensure that the furnishing of supplemental benefits is clinically appropriate. The regulation text uses the term clinically appropriate as opposed to medically necessary because while supplemental benefits must be medically necessary based on long standing guidance, certain supplemental benefits (that is, SSBCI) may be non-primarily health related. Thus, a standard based on medical necessity may not always be appropriate and using the term clinically appropriate is more inclusive of SSBCI that may or may not be primarily health related. As discussed in section III.E.2 of this rule, MA plans are still permitted to use additional coverage criteria when Traditional Medicare coverage criteria are not fully established to determine medical necessity as specified at  422.101(b)(6). This codifies CMSs existing expectations about the appropriate use of prior authorization and will provide important beneficiary protections that prior authorization processes are not used as a barrier to accessing medically necessary services. Comment: Several commenters thanked CMS for acknowledging prior authorization as an acceptable and useful utilization management tool. Some commenters stated that prior authorization is necessary to manage care and prevent overutilization. Many of these commenters supported CMS codifying that prior authorization policies and procedures for coordinated care plans may only be used to confirm the presence of diagnoses or other medical criteria that are the basis for coverage determinations for the specific item or service, and for basic benefits, to ensure an item or service is medically necessary based on standards specified in  422.101(c)(1). Other commenters suggested that CMS do more to limit the use of prior authorization, in general. For example, some commenters suggested CMS prohibit prior authorization for certain covered services. One commenter suggested CMS require MA plans to exempt providers participating in value-based models from prior authorization requirements. Another commenter requested that CMS require plans to post prior authorization criteria. Others suggested CMS implement greater oversight over prior authorization policies by requiring plans to submit their policies for CMS to review. Response: We thank commenters for their comments and suggestions. As previously stated, CMS believes that prior authorization is an acceptable utilization management tool and authorized under the Medicare Advantage statutory provisions at section 1852(c) and (g)(1)(A) of the Act. However, we also believe that appropriate limitations on the use of these policies is necessary, so we are relying on our authority under section 1856(b) and 1857(e)(1) of the Act to adopt regulatory limitations designed to protect beneficiaries and ensure their access to medically necessary (or clinically appropriate in the case of certain supplemental benefits) covered benefits. Section 1852(a) of the Act requires MA plans to cover basic benefits and authorizes coverage of supplemental benefits. Ensuring access to covered benefits is one of CMSs policy goals for the MA program and regulating use of prior authorization to ensure that inappropriate barriers to services are not being established supports that policy goal. As to suggestions that CMS do more to prohibit the use of prior authorization, we do not believe that we have authority for a sweeping prohibition on all use of prior authorization. As to prior authorization requirements for specific services, we did not propose such broad limitations and believe that appropriate investigation and study of such a policy is warranted before it could be adopted. Our proposals at  422.138, which we are finalizing, address when and how MA plans may use prior authorization generally, except where prohibited by other rules (for example  422.113). As previously discussed, the proposals at  422.138(b)(1) through (3) were made to limit the use of prior authorization processes only to confirm the presence of diagnoses or other medical criteria that are the basis for coverage determinations for the specific item or service, to ensure basic benefits are medically necessary based on standards specified in  422.101(c)(1), or to ensure that the furnishing of supplemental benefits is clinically appropriate. We are also finalizing, at  422.112(b)(8), that minimum continuity and coordination of care requirements for coordinated care plans include that approval of a prior authorization request for a course of treatment must be valid for as long as medically necessary to avoid disruptions in care, and that prior authorization be prohibited for a minimum 90-day transition period for any active course(s) of treatment when an enrollee has enrolled in an MA plan after starting a course of treatment. In response to the suggestion that CMS require MA plans to exempt providers participating in value-based VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00083 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222202 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations 106The scope of that proposed rule is broader than summarized here. models from prior authorization requirements, we note that MA plans determine through negotiations with providers, the terms by which contracted health care providers are paid, and section 1854(a)(6)(B)(iii) of the Act and CMS regulations at  422.256(a)(2)(ii) prohibit CMS from requiring an organization to contract with a particular health care provider or to use a particular price structure for payment under such a contract. MA organizations have the flexibility to, but are not required to, incorporate value- based payment into their payment arrangements with providers, including the terms on which payments are made (for example, whether payment is available if prior authorization procedures have not been met). We consider participation in such payment arrangements to be a contractual matter between organizations and their contracted providers. Given these limitations, we do not believe CMS has the authority to adopt requirements for these contractual arrangements related to payment between MA organizations and contracted providers. As to the comment requesting that CMS require MA plans to make prior authorization criteria publicly available, we do not believe adopting that requirement in this rule is necessary. Currently,  422.111(b)(7) requires MA plans to disclose to enrollees any prior authorization rules and other review requirements that must be met in order to ensure payment for the services. In addition,  422.202(b)(2) requires MA plans that use a network of providers to communicate practice guidelines and utilization management guidelines to providers and, as appropriate, to enrollees. Finally, the proposed rule Medicare and Medicaid Programs; Patient Protection and Affordable