2023-07115.pdf

Per  422.562(a)(4), which has not been amended in this rule, MA plan medical directors are responsible for ensuring the clinical accuracy of all organization determinations and reconsiderations involving medical necessity. MA organizations must have adequate procedures and systems in place to fulfill their obligations under part 422, including making organization determinations about coverage. (See for example,  422.503(a)(4) 422.504(a)(16) and 422.566(a)). Section 422.101(c)(1)(C) requires that medical necessity determinations be made based on, among other things, the enrollees medical history, physician recommendations, and clinical notes. This effectively means that all relevant clinical information is to be used by the MA plan in making the determination. Also, we are also finalizing the proposal to revise  422.566(d) and 422.629(k)(3), in section III.G of this rule, to state that the physician or other appropriate health care professional who conducts the organization determination review must have expertise in the field of medicine that is appropriate for the item or service being requested before the MA organization or applicable integrated plan (AIP) issues an adverse decision on medical necessity. In response to the comment that that peer-to-peer reviews often include medical directors without relevant expertise, we interpret peer to peer review to mean a discussion between the patients doctor and a medical professional at the MA plan to obtain a prior authorization approval or appeal a previously denied prior authorization. While CMS does not have requirements that govern who within an MA plan must conduct peer to peer reviews, we reiterate that if the MA plan issues an adverse organization determination, the physician or other appropriate health care professional who conducts the organization determination review must have expertise in the field of medicine that is appropriate for the item or service being requested. Comment: Some commenters requested that CMS require that a treating clinicians medical determination be the primary factor in any determination related to admission or transfer to another level of care when no NCD or LCD is present. Response: We thank commenters for their suggestions. Under the revisions to  422.101(c)(1) that we proposed and are finalizing in this rule, physician recommendations are required to be considered when making medical necessity determinations about the specific enrollee and requested services. This will apply in all contexts, not only when an enrollee is being transferred from one level of care to another or being admitted on an inpatient basis. Specifically, CMS proposed to codify at 422.101(c) that MA organizations must VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00080 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222199 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations make medical necessity determinations based on: (1) coverage and benefit criteria as specified or authorized at 422.101(b) and (c) (and may not deny coverage for basic benefits based on coverage criteria that are not specified in  422.101(b) or (c); (2) whether the provision of items or services is reasonable and necessary under section 1862(a)(1) of the Act; (3) the enrollees medical history (for example, diagnoses, conditions, functional status), physician recommendations, and clinical notes; and (4) where appropriate, involvement of the organizations medical director as required at  422.562(a)(4). This regulation text is based on longstanding guidance in section 10.16 of Chapter 4 of the Medicare Managed Care Manual. In codifying this policy for medical necessity determinations, we reiterate that these four factors are appropriate and necessary considerations when making a medical necessity determination. Comment: One commenter requested CMS clarify whether the proposed rules around coverage criteria for basic benefits prevent plans from providing supplemental benefit based on functional or social determinants of health (SDOH) needs. Response: The rules around coverage criteria for basic benefits adopted and discussed in this final rule do not prevent MA organizations from taking SDOH into account when designing or determining eligibility for Special Supplemental Benefits for the Chronically Ill (SSBCI)  422.102(f). For clarity, we remind the commenter that as discussed in the 2020 Final rule (85 FR 33796), MA plans may consider social determinants of health as one factor, when determining eligibility for an SSBCI, to help identify chronically ill enrollees whose health could be improved or maintained with SSBCI. However, MA plans may not use social determinants of health as the sole basis for determining eligibility for SSBCI. Comment: Some commenters requested that CMS clarify how we intend to enforce the requirements in section III. E of this rule, including the new requirements related to coverage criteria at  422.101(b)(2) and  422.101(b)(6) and medical necessity determinations at  422.101(c). One commenter suggested CMS audit inpatient admissions to ensure the rules are followed. Response: We thank commenters for their comments. As stated in the proposed rule, CMS currently monitors MA organization compliance with this existing policy through account management activities, complaint tracking and reporting, and auditing activities. These oversight operations are designed to alert CMS to any issues with access to care, and CMS may require MA organizations to address these matters if they arise. CMS intends to continue these oversight operations to ensure MA organizations compliance with the provisions in this final rule. Furthermore, as previously discussed, under  422.504, MA organizations must provide information and access to CMS (and HHS and the OIG) as it conducts its oversight of MA plans and their compliance with MA program requirements. CMS may, therefore, review all aspects of the plans decision- making as necessary to ensure compliance with program rules. Comment: We received some comments requesting that CMS delay the implementation date of the utilizations management related provisions in this rule, including the medical necessity proposals at  422.101(b) and (c). One commenter stated that they were concerned that plans would have a limited time to review, assess, and implement changes needed to comply with these rules. Another commenter stated that compliance with these changes would require contracting, staffing, and resource infrastructure changes. Some commenters stated that providing a publicly accessible summary of evidence (considered during the development of the criteria) would require significant administrative effort in particular. Some commenters stated that the implementation date should be delayed because utilization management provisions finalized in this rule, would require significant administrative effort to implement. Response: We thank commenters for expressing their concerns.. We believe MA organizations already have robust processes and systems in place for making medical necessity determinations, as these decisions are inherent in and fundamental to any care coordination plan. We acknowledge that compliance with  422.101(b) and (c) will require changes to existing plan processes and create burden for MA organizations. We believe that many MA organizations are already following Traditional Medicare coverage guidelines, while others may be making greater use of other clinical decision- making tools that fall outside Traditional Medicare. As such, we are not able to fully quantify the burden of these changes. Nevertheless, we believe it is important to codify clearer rules regarding how Part A and B benefits must be covered and furnished in the MA program as soon as possible in order to ensure that all MA enrollees receive the basic benefits coverage to which they are entitled. We solicited comment on the burden associated with our proposals. As discussed, we stated that we were unable to quantify or predict how many MA organizations are currently operating in a manner that would conform with our proposed changes to  422.101(b) and (c). We solicited comment from stakeholders on the full scope of this burden. As previously discussed, some commenters stated that the utilization management provisions and coverage criteria requirements in this rule would require significant administrative effort. For example, some commenters stated that providing a publicly accessible summary of evidence would require significant administrative effort. Some commenters asserted that the rules presented here would require changes to contracts, staff, resource infrastructure, and other plan related systems and processes. One commenter stated that CMS did not adequately account for the effort associated with meeting these requirements. However, we did not receive comments on our cost and burden analyses. The stakeholder comments of increased administrative burden are consistent with our statement in the proposed rule that due to its complexity and many unknowns, we cannot quantify the burden. After careful consideration of all comments received, and for the reasons set forth in the final rule and in our responses to the related comments in sections III.E.2 of this final rule, we are finalizing the substance of our proposals for  422.101(b) and (c) with modifications as follows: We are finalizing amendments to  422.101(b)(2), largely as proposed but with modifications to clarify the scope of the requirement and to correct the citation to 42 CFR 412.622(a)(3) and to explicitly state the applicability of the inpatient only list. We are finalizing the regulatory language at  422.101(b)(6) largely as proposed, but with modifications to state when coverage criteria are not fully established, to clarify that the obligation to make information publicly accessible applies to the internal criteria in use, to enhance transparency requirements related to use of internal coverage criteria. Based on the scope of these modifications and clarifications, we have slightly reorganized paragraph (b)(6) to add a new paragraph (b)(6)(i) to address when Medicare coverage criteria are not fully established and a new paragraph (b)(6)(ii) to address the procedural and transparency requirements that apply when an MA VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00081 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222200 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations 105https://cms.gov/medicare-coverage-database/ view/ncd.aspx?NCDId=373. organization adopts internal coverage criteria for basic benefits. We are finalizing the modifications at 422.101(c) as proposed; and We are finalizing the re-designation of Exception for qualifying hospital stay paragraph from 422.101(c)(1) to 422.101(c)(2) as proposed. 3. Appropriate Use of Prior Authorization Except for emergency, urgently needed, and stabilization services ( 422.113(a)), and out-of-network services covered by MA PPO plans, all services covered by MA coordinated care plans (including MSA network plans, which are coordinated care plans under 422.4(a)(iii)(D)), may be subject to prior authorization. In addition, MA PFFS and MA MSA plans are not permitted to use prior authorization policies or prior notification policies that reduce cost sharing for enrollees based on whether the enrollee or provider notifies the PFFS or MSA plan in advance that services will be furnished. See  422.4(a)(2)(i)(B) and (a)(3)(iv). Appropriate prior authorization should only be used to confirm the presence of diagnoses or other medical criteria and to ensure that the furnishing of a service or benefit is medically necessary or, for supplemental benefits, clinically appropriate and should not function to delay or discourage care. Therefore, we proposed to codify this at new  422.138(a). Specifically, we proposed a new  422.138(a) to provide that a coordinated care plan may use prior authorization processes for basic benefits and supplemental benefits only when the prior authorization processes are consistent with new  422.138. We explained that, for purposes of this proposal, we used the term processes to include prior authorization policies and procedures that address any and all aspects of how prior authorization is used by an MA organization in a coordinated care plan. We also proposed a new  422.138(b)(1) through (3) 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. The standard clinically appropriate 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