2023-07115.pdf

dually eligible enrollment in a non-SNP plan, as well as add a corrective action period before the termination of an MA plan if the threshold is crossed. The commenter explained that providing such plans with the ability to crosswalk enrollees and a six-month window for corrective action may prevent CMS from needing to terminate the full MA contract and would prevent negative impacts for enrollees. Another commenter recommended that CMS provide details regarding the circumstances under which it would use the proposed authority to terminate an MA contract instead of taking more incremental measures to achieve compliance with the proposal. Response: We appreciate these comments and the requests for clarification. As stated in the June 2020 final rule at 85 FR 33812 and reiterated in the preamble to the proposed rule at 87 CFR 79466, we implement the contracting prohibition in  422.514 at the plan level. We will similarly implement the contracting prohibition at the segment level if enrollment in the segment exceeds the DSNP look-alike threshold. Where an MA plan is one of several offered under a single MA contract and the MA organization does not voluntarily non-renew the DSNP look- alike, CMS will sever the DSNP look- alike from the overall contract using its authority under  422.503(e) to sever a specific MA plan from a contract, and then terminate the deemed contract for the DSNP look-alike. The other, non- DSNP look-alike plans offered under the original contract would not be terminated. This action, in effect, allows CMS to renew only the portion of the contract that does not include the D SNP look-alike. In this final rule, we are finalizing an amendment to  422.503(e) to allow for CMS to sever a segment from an MA plan and allow the remaining non-DSNP look-alike segments of that MA plan to continue along with any other non-DSNP look- alike plans offered under the same contract. Further, MA plans and MA plan segments that meet the criteria at  422.514(d)(2) will have the opportunity to transition enrollees from a DSNP look-alike per  422.514(e). The transition authority at  422.514(e) only permits transitioning the enrollment from the DSNP look-alike plan or segment, that is, MA plans or segments that meet contracting limitation requirements at  422.514(d)(2). The transition authority at  422.514(e) does not apply to non- SNP MA plans with less than 80 percent dually eligible enrollees; a permissible crosswalk may be available depending on the circumstances. The comments about permitting transition of enrollees from plans at risk of reaching the 80 percent threshold and allowing a correction action period before termination of the MA plan meeting  422.514(d) are out of scope for this rulemaking; we believe that policymaking on this issue would benefit from further study and engagement with interested parties. We will consider these comments for future rulemaking. Comment: A few commenters supported our proposal but noted that confusion can arise when crosswalk transactions are processed between segmented and non-segmented plans due to the variety of permissible scenarios. These commenters explained that in some cases CMS approved crosswalk transition plans for 2023 but MA plans later experienced incorrect denials during the plan crosswalk process despite the prior approval. These commenters believed the VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222134 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations 3The California three-way contract is available at: https://www.cms.gov/Medicare-Medicaid- Coordination/Medicare-and-Medicaid- Coordination/Medicare-Medicaid-Coordination- Office/FinancialAlignmentInitiative/Downloads/ CAContract.pdf. proposal would clarify some of this confusion but recommended that CMS work with plan sponsors to ensure approvals are clearly indicated within the Health Plan Management System (HPMS) and appropriately communicated to all parties involved in executing crosswalk transactions. Response: We thank the commenters for their perspectives. We acknowledge that confusion can arise related to D SNP look-alike transitions permitted under  422.514(e) and crosswalk exceptions under  422.530(c). We are planning enhancements to HPMS that will improve the clarity of approved and denied transactions. Comment: A commenter requested that CMS confirm whether it is permissible to consolidate two or more existing plans into a single plan and then segment the resulting consolidated plan. Response: We appreciate the comment. While an MA organization could consolidate two or more existing plans into one MA plan per  422.530(b)(1)(ii) and segment the resulting consolidated plan, the resulting consolidated plan would be subject to the requirement we are finalizing at  422.514(g). Comment: A commenter suggested that CMS delay implementation of the contracting limitations until January 1, 2025 to align with the transition of Medicare-Medicaid Plans (MMP). The commenter added that this delay would give dually eligible individuals who are currently enrolled in MMPs the ability to move to a DSNP at the end of the demonstration and would give States that are currently participating in MMPs the ability to transition to DSNPs as well. Response: We appreciate the commenters suggestion but do not agree. The existing DSNP look-alike contract limitation and transition authority at  422.514(d) through (f), and amendments finalized at  422.514(d) and  422.514(g) in this rule, are not necessary to facilitate MMP to DSNP transitions. Rather, CMS will work with States participating in the Financial Alignment Initiative to transition as described in the final rule titled Medicare Program; Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs; Policy and Regulatory Revisions in Response to the COVID19 Public Health Emergency; Additional Policy and Regulatory Revisions in Response to the COVID19 Public Health Emergency which appeared in the Federal Register on May 9, 2023 (CMS4192F) at 87 CFR 27796 through 27798. This process is consistent with the transition of California MMPs to DSNPs effective January 1, 2023.3The transition of enrollees from MMPs to DSNPs does not address our need to stem the proliferation and growth of DSNP look- alikes now, as summarized earlier in this section and discussed in more detail in the February 2020 proposed rule (85 FR 9018 through 9021). Comment: A commenter encouraged CMS to continue efforts to reduce incentives for non-SNP plans to focus enrollments efforts on dually eligible individuals. A commenter suggested that CMS continue to monitor and evaluate any non DSNP plan where dually eligible individuals make up the majority of the covered lives to ensure the plan is not engaged in deceptive marketing practices. Another commenter recommended that CMS contemplate requiring Medicare to inform beneficiaries when they are enrolling in a non-integrated model where an integrated model exists. Response: We appreciate the comments and agree with concerns about the potential proliferation of D SNP look-alikes that are not required to comply with the requirements for D SNPs and that may undermine our goals of encouraging and furthering integrated coverage options for dually eligible individuals. As described in the June 2020 final rule at 85 FR 9020, we stated that the prevalence of DSNP look- alikes has led to instances of misleading marketing by brokers and agents that misrepresent to dually eligible individuals the characteristics of such look-alike plans, especially where the plans have marketed themselves as being special Medicaid-focused plans. We sought to reduce that prevalence through finalizing the DSNP look-alike contracting limitations at  422.514(d). Also in the June 2020 final rule, we codified at  422.2262(a)(1)(xvi) a prohibition on MA organizations, with respect to their non-DSNP plans, from marketing their plan as if it were a D SNP, implying that their plan is designed for dually eligible individuals, targeting their marketing efforts exclusively to dually eligible individuals, or claiming a relationship with the State Medicaid agency, unless a contract to coordinate Medicaid services for that plan is in place. We will continue to monitor the level of dually eligible enrollment among non- SNP MA plans. This comment is out of scope for this rulemaking, but we will consider ways to monitor non-DSNP plans for deceptive marketing practices and contemplate for future rulemaking a requirement to inform beneficiaries upon enrolling into a non-integrated model where an integrated model exists. Comment: A commenter noted that the unforeseen loopholes reinforced their concerns about the overly complex nature of MA contracting and the opportunities that complexity brings for abuse, which led to the need for DSNP look-alike regulations. This commenter emphasized that complexity hampers transparency as shown by the MA plan segment issues and recommended that CMS take a hard look at its contracting and oversight of MA plans to ensure the system is more straightforward, accountable, and transparent. Response: We welcome this perspective. While this comment is out of scope for this rulemaking, we will consider it for future rulemaking and oversight opportunities. After considering the comments we received and for the reasons outlined in the proposed rule and our responses to comments, we are finalizing revisions to  422.503(e), 422.504(a)(19), 422.510(a)(4), and 422.514(g) as proposed. B. Part D Special Enrollment Period Change Based on CAA Medicare Enrollment Changes ( 423.38) Section 101 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108173) established a Part D Voluntary Prescription Drug Benefit program for Medicare-eligible individuals. The MMA added section 1860D1(b)(3)(C) of the Act, which authorized the Secretary to establish Part D special enrollment periods (SEP) for Medicare-eligible individuals to enroll in a Part D plan based on exceptional conditionsthat is, an individual may elect a plan or change his or her current plan election when the individual meets an exceptional condition as determined by the Secretary. In 2020, we codified a number of exceptional condition SEPs, including the SEP for Individuals Who Enroll in Part B During the Part B General Enrollment Period (GEP) (85 FR 33909). This SEP, as codified at  423.38(c)(16), allowed individuals who are not entitled to premium-free Part A and who enroll in Part B during the GEP for Part B (JanuaryMarch) to enroll in a Part D plan. This SEP begins April 1st and ends June 30th, with a Part D plan enrollment effective date of July 1st. This SEP effective date aligns with the VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222135 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations entitlement date for Part B for individuals who enroll in Part B during the GEP. Prior to January 1, 2023, when an individual enrolled in Part B during the GEP, their Part B enrollment entitlement date was July 1st, regardless of when during the GEP they enrolled. Division CC, title I, subtitle B, section 120 of the Consolidated Appropriations Act, 2021 (CAA) Public Law 116260 modified section 1838(a)(2) of the Act, to address the beginning of the entitlement for individuals enrolling during their GEP pursuant to section 1837(e) of the Act. As added by the CAA, section 1838(a)(2)(D)(ii) of the Act requires that, for an individual who enrolls in Part B during the GEP on or after January 1, 2023, entitlement begins the first day of the month following the month in which the individual enrolled. For example, if an individual enrolls in Part B in February 2023 (during the GEP), their Part B coverage will begin on March 1st. Based on Medicare enrollment statutory changes made by the CAA described previously, we proposed to modify  423.38(c)(16) to provide that on or after January 1, 2023, an individual who is not entitled to premium-free Part A and who enrolls in Part B during the GEP is eligible to use the SEP for Individuals Who Enroll in Part B During the Part B GEP to request enrollment in a Part D plan, and that this SEP will begin when the individual submits the application for Part B, and will continue for the first 2 months of enrollment in Part B. Further, we proposed to modify  438.38(c)(16) to provide that where an individual uses this Part D SEP to request enrollment in a Part D plan, the Part D plan enrollment would be effective the first of the month following the month the Part D plan sponsor receives the enrollment request. These proposed revisions are needed to align the timeframe for use of this Part D SEP based on new Part B GEP enrollment effective date parameters. Because an individual may elect a Part D plan only during an election period, Medicare Part D sponsors already have procedures in place to determine the election period(s) for which an applicant is