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Managing Principal Jonathon Blum Breaks Down Trump Administration’s Agenda for Pharmacy Rebates

Medicare policy expert and HMA Managing Principal Jonathan Blum weighed in on the Trump administration’s recently proposed rules for pharmacy rebates and plans to reduce prescription drug prices in a blog post for Health Affairs.

Blum provided insight to questions about implementation of the proposed drug rebate reforms and whether they will lead to lower drug prices. The fundamental changes proposed would govern how pharmaceutical manufacturers pay rebates to pharmacy benefit managers and managed care plans contracted with Medicare, as well as state Medicaid programs.

He also addressed the variables outlined in the administration’s 2018 plan, American Patients First, which aim to reduce out-of-pocket costs and lower drug prices.

Blum joined HMA in 2018. In his previous leadership role at the Centers for Medicare and Medicaid Services from 2009-2014 he had direct responsibility for administration of the Medicare program.

HMA MACPAC Report Published

A team of HMA colleagues including Sarah Barth, Sharon Silow-Carroll, Esther Reagan, Mary Russell and Taylor Simmons completed a study for the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC) to examine care coordination requirements for several Medicare-Medicaid integrated care models.

The study’s final report, Care Coordination in Integrated Care Programs Serving Dually Eligible Beneficiaries – Health Plan Standards, Challenges and Evolving Approaches, is posted to the MACPAC website.

The final report details state and federal managed care contract requirements for care coordination, summarizes stakeholders’ perspectives on care coordination based on structured interviews, and highlights promising care coordination practices and challenges for ensuring effective care coordination for dually eligible beneficiaries.

Medicaid Managed Care Spending in 2018

This week, our In Focus section reviews Medicaid spending data collected in the annual CMS-64 Medicaid expenditure report. After submitting a Freedom of Information Act request to Centers for Medicare & Medicaid Services (CMS), we have received a draft version of the CMS-64 report that is based on preliminary estimates of Medicaid spending by state for federal fiscal year (FFY) 2018. The final version of the report will be completed by the end of 2019 and posted to the CMS website at that time. Based on the preliminary estimates, Medicaid expenditures on medical services across all 50 states and six territories in FFY 2018 exceeded $588 billion, with over half of all spending now flowing through Medicaid managed care programs. In addition, total Medicaid spending on administrative services was $27.8 billion, bringing total program expenditures to $616 billion.

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HMA Summary of 2020 Medicare Advantage and Part D Flexibility Final Rule

This week, our In Focus reviews the Calendar Year (CY) 2020 Medicare Advantage (MA) and Part D Flexibility Final Rule (Final Rule) issued by the Centers for Medicare & Medicaid Services (CMS) on April 5, 2019. The Final Rule implemented various provisions contained in the Bipartisan Budget Act of 2018 (BBA), which required the expansion of MA telehealth benefits and established new criteria for Dual Eligible Special Needs Plans (D-SNPs) integration requirements and streamlined Medicare and Medicaid grievance and appeals processes. The Final Rule also established rules to improve MA and Part D program quality and accessibility, clarified program integrity policies, and established new rules for the MA and Part D Quality Rating System.

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HMA Analysis of 2020 Medicare Advantage Rate Notice and Final Call Letter

This week, our In Focus reviews the Announcement of Calendar Year (CY) 2020 Medicare Advantage Capitation Rates and Medicare Advantage (MA) and Part D Payment Policies (Rate Announcement) and Final Call Letter, issued by the Centers for Medicare & Medicaid Services (CMS) on April 1, 2019. The Rate Announcement and Call Letter includes final updates to MA payment rates and guidance to plan sponsors as they prepare their bids for CY 2020. Bids for CY 2020 are due to CMS on or before Monday June 3, 2019. It is important to note that the Announcement and final Call Letter does not take into consideration the Health and Human Services (HHS) Office of Inspector General (OIG) proposed rule which seeks to remove anti-kickback protection for prescription drug rebates, which, if finalized as proposed, could have significant impacts on Part D plans’ bids. While the administration has not provided any guidance on how plans should construct their 2020 bids in response to the rebate changes, HHS could decide to delay the rule’s effective date to 2021 or CMS may allow plans to update their 2020 bids later this year.

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CMS Increases Monitoring and Evaluation Requirements for Section 1115(a) Medicaid Demonstrations

This week, our In Focus reviews the implications of the new federal guidance for state waivers with community engagement, premiums, non-eligibility periods, and other personal responsibility provisions.

Background

On March 14, 2019, the Centers for Medicare & Medicaid Services (CMS) issued several new guidance documents that significantly increase the level of monitoring and evaluation required for Section 1115(a) Medicaid Demonstrations. These new requirements apply to community engagement, premiums, and other waiver provisions that impact eligibility and enrollment, and affect states currently with such waivers as well as any states proposing these ideas.  Changes in reporting, data collection, and waiver monitoring processes will be necessary, and soon—as the materials details compliance dates for these significant new requirements.

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Analysis of Key Medicare Proposals in the President’s FY 2020 Budget

This week, our In Focus comes to us from HMA Senior Consultant Narda Ipakchi. On March 11, 2019, the White House released President Trump’s budget for fiscal year (FY) 2020, which includes a number of legislative and administrative proposals related to Medicare that would reduce net Medicare spending by $811 billion over the next ten years. It is important to note that the legislative proposals included in the President’s budget are non-binding and serve as recommendations to Congress where they may or may not be advanced. Under a Democratic-majority House of Representatives, many of the legislative proposals outlined in the FY 2020 budget are unlikely to advance. Several of the policies, however, such as reductions to Medicare bad debt and implementing site neutral payment systems were also proposed by the previous administration. Administrative proposals are more likely to move forward, as the administration can implement these policies through its regulatory channels.

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