2023-07115.pdf

had one Part D sponsor serve as the sole contractor for administering LI NET. We have found that this approach supports our goal of administrative simplicity by making it unnecessary for each individual plan sponsor to check eligibility and conduct a retroactive enrollment/reimbursement process. In our experience, the benefits of having a single Part D sponsor administer LI NET include the following: Providing a single point of contact for beneficiaries and pharmacies attempting to have their claims paid. Providing a single point of contact for State Medicaid agencies submitting Medicaid eligibility and attempting to reconcile and coordinate claims. Simplifying the filing of retroactive beneficiary claims. There may be circumstances in which CMS may want to consider contracting with more than one Part D sponsor to administer LI NET. Though we have had stability in LI NET in terms of only having a single LI NET sponsor for the duration of the demonstration, we recognize the need for some protections should it become necessary for another entity to take over as LI NET sponsor and assume responsibility for providing LI NET coverage. The downside of consolidating LI NET functions into a single sponsor is the potential for beneficiary impact should there be a reason that the single LI NET sponsor no longer continues its functions. We believe that this potential for beneficiary impact is mitigated by our proposals to non-renew or terminate the LI NET contract per proposed  423.2520. Accordingly, while we proposed at new  423.2512 that the program will be operated by one or more Part D sponsors, we intend to initially continue with the current practice of operating the program through a single sponsor because we determined the benefits outweigh potential beneficiary impacts, which have not come to bear since the start of the demonstration in 2010. We proposed to establish at  423.2512 the requirements the LI NET sponsor must meet when administering the LI NET program: Because LI NET may enroll beneficiaries from across the nation, we proposed to specify at  423.2512(a)(1) that the LI NET sponsor would be selected from among the Part D sponsors VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222142 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations with a national presence, with an established contracted pharmacy network in all geographic areas of the United States in which LIS is available, which as of the date of this final rule is the 50 States and the District of Columbia. Because LIS is not available in the territories, CMS would not require the LI NET sponsor to have network pharmacies in territories. LI NET beneficiaries could still access LI NET benefits while in the territories if needed, however, through out-of- network pharmacies. We find that some experience as a Part D sponsor should be a pre-requisite for being the LI NET sponsor, and proposed at  423.2512(b) that any candidates to be the LI NET sponsor have a minimum of 2 consecutive years contracting with CMS as a Part D sponsor. We proposed at  423.2512(c) some technical and operational requirements of the LI NET sponsor. In  423.2512(c)(1) and (c)(2) we proposed that the LI NET sponsor have the technical capability and the infrastructure to provide immediate, current, and retroactive coverage for LI NET enrollees and the technical capability to develop the infrastructure necessary for verifying Medicaid dual eligibility status for presumed eligible LI NET enrollees. In  423.2512(c)(3), we proposed requiring the LI NET sponsor to identify, develop, and implement outreach plans in consultation with CMS targeting key stakeholders to inform them about the LI NET program. Under the demonstration, CMS enrolls over 90 percent of LI NET beneficiaries into the LI NET plan and we expect CMS would continue to be responsible for most enrollments in a permanent LI NET program. For the beneficiaries who are not auto-enrolled, outreach is important so that stakeholders like the states, SHIPs, and pharmacies have awareness and knowledge about the LI NET program. Under the demonstration, the LI NET sponsor routinely conducts outreach in consultation with CMS to inform stakeholders about the program. We proposed to adopt this approach for the permanent LI NET program. As discussed further in this section of this rule, we proposed to waive requirements under  423.128(d)(2)(ii), 423.128(d)(2)(iii), and 423.128(d)(4). We also proposed in  423.2512(c)(4) that the LI NET sponsor be required to establish and manage a toll-free customer service telephone line and fax line that can be accessed by pharmacy providers and beneficiaries, or others acting on their behalf, for purposes that include but are not limited to: handling inquiries about services under the LI NET program, providing the status of eligibility or claims, and having the ability to accept documentation for evidence of eligibility. Reimbursement to beneficiaries with retroactive coverage is provided for in section 1860D14(e)(3)(B) of the Act, as the amounts that would have been paid under this Part had such individual been enrolled in a prescription drug plan or MAPD plan. Implementing this statutory provision entails establishing a process for beneficiaries to request and receive such reimbursement. In the demonstration, we provide a means for beneficiaries who receive retroactive coverage to submit a direct member out-of-pocket reimbursement request for Part D covered drugs for any past month(s) in which they were entitled to retroactive coverage under LI NET. The LI NET sponsor provides reimbursement to eligible beneficiaries based on the submitted cost minus any applicable copayments. Once the LI NET sponsor receives a written reimbursement request, they follow timeframes that are consistent with the timeframes that apply when a Part D sponsor authorizes payment for a benefit due to a reversal in its coverage determination (see  423.636(a)(2)). That is, under the demonstration, the LI NET sponsor has 14 calendar days to reply with whether the claim is eligible for reimbursement, including the reason for denying the request if applicable. If the request for reimbursement is granted, the LI NET sponsor issues the reimbursement no later than 30 days after it determines the claim is eligible for reimbursement. As these timeframes have proved workable under the demonstration, we proposed in  423.2512(c)(5) that the LI NET sponsor meet these deadlines related to direct reimbursement in the permanent LI NET program. In  423.2512(c)(6), we proposed requiring the LI NET sponsor to adjudicate claims from OON pharmacies according to the LI NET sponsors standard reimbursement for its network pharmacies. As the LI NET sponsor must provide access to all Part D drugs under an open formulary, we believe there is the need for some protection against unreasonably high drug costs for OON claims in LI NET. Other Part D sponsors have the option to deny such claims, or to pay OON claims according to their standard reimbursement for their network pharmacies (with beneficiaries paying any difference between the cost of the OON claim and the negotiated price). Because this restraint on unreasonable drug costs borne by the Medicare Trust Funds would not otherwise be present for LI NET, we believe a limit on how much the LI NET sponsor can be reimbursed for OON claims is needed. 5. Selection of LI NET Sponsor and Contracting Provisions Section 1860D14(e)(6) of the Act authorizes us to implement LI NET without regard to laws relating to the making, performance, amendment, or modification of contracts of the United States as we may determine to be inconsistent with the furtherance of the purpose of Title XVIII. Thus, CMS is not required to follow the Federal Acquisition Regulation (FAR) or the contracting authority used under the Part D program. Neither is CMS required to contract with every qualified plan sponsor to provide LI NET Part D coverage, as we are required to do for qualified plan sponsors providing non- LI NET Part D coverage. If we followed the same approach for LI NET, we could have many points of contact for beneficiaries and pharmacies attempting to have their retroactive claims paid and multiple points of contact for State Medicaid agencies submitting Medicaid eligibility and attempting to reconcile and coordinate claims. This approach would not serve the purpose of providing smooth, transitional coverage for Part D drugs for LI NET eligible individuals through the LI NET program, which is a Part D program under Medicare in Title XVIII. Using the authority in section 1860D 14(e)(6) of the Act, we proposed to follow the contracting approach set forth in proposed  423.2516 to select the LI NET sponsor for the 2024 plan year and onwards. In  423.2516(a), we proposed that CMS would appoint a Part D sponsor that meets the requirements at  423.2512 to serve as the LI NET sponsor. To determine this appointment, we proposed that CMS may choose to conduct discussions with potentially eligible entities to establish mutual interest and ability to administer the program. This circumstance could arise if, for example, CMS needs additional information in any particular year to learn more about a Part D sponsors ability to administer the LI NET program. Under the demonstration, there is a multi-year contract approved by the Office of Management and Budget, and each year CMS and the LI NET sponsor have executed an addendum to the contract that included such information as the payment rates and risk corridors as determined in the final bid. As we consider options for establishing regulations to implement the permanent LI NET program, we find it is appropriate that we bring the LI VerDate Sep<11>2014 21:20 Apr 11, 2023 Jkt 259001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4700 E:\FR\FM\12APR2.SGM 12APR2ddrumheller on DSK120RN23PROD with RULES222143 Federal Register / Vol. 88, No. 70 / Wednesday, April 12, 2023 / Rules and Regulations NET contractor into closer alignment with other contracts in the Part D program by executing an LI NET contract with a Part D plan sponsor each plan year that contains, among other information, payment information for that year. Our expectation is that unless circumstances shift to prompt a change, the existing LI NET sponsor would continue in that role in the succeeding year. Therefore, in  423.2516(b), we proposed selection criteria CMS may use in appointing an LI NET sponsor based on some features of the LI NET program that are related to a Part D sponsors ability to successfully administer the program. These are Experience covering low-income beneficiaries, including but not limited to enrolling and providing coverage to low-income subsidy individuals as defined in  423.34; Pharmacy access as outlined in  423.120; Past performance consistent with  423.503(b), including Star Ratings (as detailed in  423.186), and previous intermediate sanctions (as detailed in  423.750); and Ability to meet the requirements listed in  423.505 that are not waived under  423.2536. As noted in the proposed rule and consistent with our general approach of applying Part D requirements to the LI NET program unless waived, we stated our intention for  423.505 to apply to LI NET with the exception of  423.505(k)(6), which we proposed to waive in  423.2536(g). For example, the contract between the LI NET sponsor and CMS would be required to contain provisions in which the LI NET sponsor agrees to accept new enrollments, make enrollments effective, process voluntary disenrollments, and limit involuntary disenrollments (see  423.505(a) and (b)(2)). As another example, consistent with  423.505(b)(22), the LI NET contract would be required to include a provision in which the LI NET sponsor agrees to use the CMS complaint tracking system to address and resolve complaints received by CMS against the sponsor. Per  423.505(k), the LI NET contract would also require the LI NET sponsor to submit certifications of data that determine payment as applicable, such as for enrollment and payment information, claims data, bid submission information, DIR data, and overpayments. The only certification the LI NET sponsor would not submit is the one pertaining to data for price comparison under  423.505(k)(6); we believe this certification is unnecessary given that the LI NET plan is not one for which beneficiaries shop and thus would not be comparing against other plan options based on price considerations. We intend to exclude LI NET from Medicare Plan Finder, consistent with past practice under the demonstration. Therefore, it would not make sense to require certification to data for price comparison purposes, and we proposed to waive this requirement in  423.2536(g). In  423.2516(c), we proposed that the term of the LI NET sponsors appointment would be ongoing provided mutual agreement between CMS and the selected party, subject to an annual contracting and bid process (per proposed  423.2524(c)) to determine payment rates for the upcoming year. As explained in the proposed rule, this approach has worked well during the demonstration, and we saw no reason to adopt a different approach for the permanent program. We proposed to establish in  423.2518 that, if the LI NET sponsor violates its contract, CMS would have the authority to impose intermediate sanctions as outlined in subpart O of the Part D regulations, just as we would for any other Part D sponsor. In  423.2520(a) we proposed that if the LI NET sponsor decides for any reason to non-renew its existing LI NET contract, it must notify CMS by January 1 of the year before the next contract year. Except as provided in paragraph (c) of this section, if CMS decides for any reason to non-renew the existing contract with the incumbent LI NET sponsor, CMS would notify the LI NET sponsor by January 1 of the year before the next