2023-07115.pdf

on the business strategies and the competitive landscape for each plan and contract. We also proposed some methodological enhancements to the Star Ratings as follows: replacing the current reward factor with an HEI reward, reducing the weight of patient experience/complaints and access measures, adding a rule for the sub- regulatory removal of Star Ratings measures when a measure steward other than CMS retires the measure, and removing the 60 percent rule that is applied when adjusting Star Ratings for extreme and uncontrollable circumstances (for example, natural disasters like hurricanes or public health emergencies). We anticipate that removing the 60 percent rule and adding a rule for subregulatory measure removal would each have a negligible impact on the highest ratings. Two of our enhancements have the potential to cause a contracts Star Rating to change: (1) decreasing the weight of patient experience, complaints, and access measures from four to two; and (2) replacing the current reward factor with an HEI that would reward contracts for doing well serving enrollees with specified social risk factors. We also simulated the cumulative impact of the proposed changes to the overall rating by geographical area specifically, by state, DC, and Puerto Rico. Since the service area of a contract can include multiple states, we assigned to each enrollee the rating of their MA contract and calculated the average rating across all enrollees residing in each state. The average change in the overall rating is a decrease of 0.099, with the changes ranging from 0.01 to 0.33 across geographic areas. Table 9 below shows the simulated changes by state, DC, and Puerto Rico. The second column is the number of MA enrollees in each state in contracts that received the 2021 overall rating. In most cases, but not all, there are larger declines in areas that had on average higher 2021 overall ratings. BILLING CODE 412001P VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00202 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222321 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00203 Fmt 4701 Sfmt 4725 E:\FR\FM\12APR2.SGM 12APR2ER12AP23.015</GPH>ddrumheller on DSK120RN23PROD with RULES222322 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations We calculated the cost impacts summarized in Tables 10 and 11 due to these proposed Star Ratings updates by quantifying the difference in the MA organizations (including Part D for MAPDs) final Star Rating with the proposed changes and without the proposed changes. We assume Medicare Trust Fund impacts due to the Star Ratings changes associated with these two revisions to the methodology. The first change, decreasing the weight of patient experience, complaints, and access measures, will be effective for the 2026 Star Ratings and will impact the 2027 plan payments and 2027 Quality Bonus Payments. The introduction of the HEI reward in lieu of the current reward factor will impact the 2027 Star Ratings and will impact the 2028 plan payments and 2028 Quality Bonus Payments. These impacts are considered transfers, but we requested comment on the extent to which provision of goods or services would increase or decrease in association with the payment changes. The impact analysis for the Star Ratings updates takes into consideration the final quality ratings for those contracts that would have Star Ratings changes under this final rule. There are two ways that Star Ratings changes will impact the Medicare Trust Fund: A Star Rating of 4.0 or higher will result in a Quality Bonus Payment for the MA contract, which, in turn, leads to a higher benchmark for the MA plans offered by the MA organization under that contract. MA organizations that achieve an overall Star Rating of at least 4.0 qualify for a Quality Bonus Payment that is capped at 5 percent (or 10 percent for certain counties). The rebate share of the savings will be higher for those MA organizations that achieve a higher Star Rating. The rebate share of savings amounts to 50 percent for plans with a rating of 3.0 or fewer stars, 65 percent for plans with a rating of 3.5 or 4.0 stars, and 70 percent for plans with a rating of 4.5 or 5.0 stars. In order to estimate the impact of the Star Ratings updates, the Private Health Baseline assumptions are updated with the assumed Star Ratings changes described in this final rule. We first estimated the two changes to the Star Ratings calculations as independent of each other and, since there are likely overall Star Rating interactions between the two changes, the impacts, as shown in Table 10, should be viewed separately and should not be summed. The negative values in this section of this final rule represent net savings to the Medicare Trust Funds. The patient experience/complaints and access measure weight provision is expected to result in net savings of between $330 million in 2027 and $580 million in 2033, resulting in a 10 year savings estimate of $3.28 billion. This amount equates to 0.05 percent of the Private Health Baseline for 20242033. The replacement of the current reward factor with the HEI reward is expected to result in net savings of between $670 million in 2028 and $1,050 million in 2033 resulting in a 10-year savings estimate of $5.12 billion. $5.12 billion represents 0.08 percent of the Private Health Baseline for the years 2024 VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00204 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ER12AP23.016</GPH>ddrumheller on DSK120RN23PROD with RULES222323 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations 2033. These projections are based on simulations using data from the 2020 and 2021 Star Ratings. We also estimated the cumulative impact of the changes to the Star Ratings calculations we are finalizing in this rule since there are interactions between those changes. The impacts are showing in Table 11. The negative values represent net savings to the Medicare Trust Funds. For the Star Ratings updates, net savings are estimated to be between $330 million in 2027 and $1.24 billion in 2033, resulting in a 10-year savings estimate of $6.41 billion, which equates to 0.10 percent of the Private Health Baseline for the years 2024 through 2033. We did not received comments on our impact analysis and therefore are finalizing these provisions without modification. 5. Expanding Eligibility for Low-Income Subsidies Under Part D of the Medicare Program ( 423.773 and 423.780) In this final rule, we will revise the Part D LIS income and resource standards at  423.773 to expand eligibility for the full benefit to individuals who currently have the partial benefit and make a coordinating change in  423.780. This will change the level of assistance that an individual could qualify for in paying their Part D VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00205 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ER12AP23.017</GPH> ER12AP23.018</GPH>ddrumheller on DSK120RN23PROD with RULES222324 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations premiums, copays and deductibles. While there would be no change in the number of individuals eligible for the Part D LIS, it will create a transition of people from partial subsidy status to full subsidy status. The result of this change is the Federal Government providing more subsidies to low income Medicare beneficiaries for Part D coverage, which would result in additional costs to the Medicare Trust Fund. The following table reflects the scored government costs for expanding the full low income subsidy to the current partly subsidized LIS beneficiaries starting January 1, 2024. Included in this table are the breakdown of increases for both the low income cost-sharing subsidy (LICS) and the low income premium subsidy (LIPS). OACT arrived at the cost estimate by assuming that the ratio of post-LICS-out-of-pocket as a percentage to the total drug cost for the partial subsidy beneficiaries would be close, possibly equal, to the drug cost of the full subsidy beneficiaries. Therefore, the impact analysis assumed that the ratio (plan benefits + LICS)/total drug cost for the partial subsidy beneficiaries was the same as the ratio for the full subsidy beneficiaries., We are classifying these payments of the Medicare Trust Fund as transfers from the Trust Fund to the LI NET sponsors. We received no comments on our regulatory impact analysis and are finalizing this impact as is. 6. Adding New Behavioral Health Specialty Types Subject to Network Adequacy Evaluation ( 422.116) To ensure that MA enrollees have access to provider networks sufficient to provide covered services, including behavioral health service providers, this rule adds new specialty types that will be subject to network adequacy evaluation under  422.116. This rule adds Clinical Psychology, Clinical Social Work and Prescribers of Medication for Opioid Use Disorder under  422.116(b)(1). However, we are not finalizing our proposed addition of Prescribers of Medication for Opioid Use Disorder for the reasons presented in section VII.C.3. To determine the potential burden regarding this proposal, we considered cost estimates for CMS making programming updates to the HPMS system, which is utilized to conduct automated reviews; additional burden, including updating policies and procedures, for CMS contractor; and additional burden, including updating policies and procedures, for MA organizations. We have determined that there is a $0 cost for programming HPMS with regard to this rule. Adding new specialty types to the automated review conducted by HPMS would be covered under funding currently in place for updating the system. The CMS contractor does not indicate any additional or reduced costs to carry out the work required by this rule; therefore, there is no impact. E. Alternatives Considered In this section, CMS includes discussions of Alternatives Considered for several provisions. Several provisions of this final rule reflect a codification of existing policy where we have evidence, as discussed in the appropriate preamble sections, that the codification of this existing policy would not affect compliance. In such cases, the preamble typically discusses the effectiveness metrics of these provisions for public health. Also, in these cases, different enforcement methods and different levels of stringency, are not fully relevant since the provision is already being complied with adequately. Alternative analysis is not provided for these provisions. 1. Utilization Management Requirements: Clarifications of Coverage Criteria for Basic Benefits and Use of Prior Authorization, Additional Continuity of Care Requirements, and Annual Review of Utilization Management Tools ( 422.100, 422.101, 422.112, 422.137, 422.138) Both the reasons for proposing the UM Committee requirement provisions and the alternatives they are intended to counteract are discussed in the respective preambles. Because we cannot quantify any of these we have not included a repetition of this analysis in the RIA. A brief summary is as follows: The finalized regulation adopts new and existing standards and requirements for coverage criteria for basic benefits by requiring MA plans to make medical necessity determinations based on Traditional Medicare coverage and benefit criteria as reflected in Medicare statutes and regulations, NCDs and LCDs and prohibiting the use of internal coverage criteria or additional medical necessity standards except in limited situations. This is major policy shift in which MA plans may only deny coverage for Medicare items and services based on Traditional Medicare coverage rules unless coverage criteria for the Part A or Part B benefit are not fully established in applicable Medicare statutes, regulations, NCDs or LCDs. As stated elsewhere in this final rule, MA plans are still permitted to use utilization management policies, such as PAwithin the scope of  422.138(b)(1) through (3)in situations where they are not permitted to use internal coverage criteria per 422.101(b)(2) and (b)(6). In situations where MA plans may not use internal coverage criteria, plans may still use PA to confirm criteria for determining whether an item or service is one for which benefits are available under Traditional Medicare. Additionally, while PA is still permitted, plans must use coverage criteria consistent with the rules being finalized at  422.101(b)(2) and (b)(6) and plans must make medical necessity determinations consistent with the rules at 422.101(c). Finally, in regards to burden, we understand that this provision will create new burden which is difficult to quantify. The finalized regulation also requires plans to follow specific procedures as part of developing internal coverage policies and making this these coverage policies publicly VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00206 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM