Medicare Advantage, Part D Plans Get COVID-19 Leeway

The Centers for Medicare and Medicaid Services has issued new guidance regarding how Medicare Advantage and Part D plans can respond to enrollees affected by the coronavirus outbreak.

Under the guidance, the plans are authorized, but not required to waive out-of-pocket costs for testing, treatment and other services related to the coronavirus.

The rules come on the heels of many of the country’s largest insurance companies announcing that they would be treating at least COVID-19 testing as covered benefits and would waive cost-sharing for tests.

The CMS made the announcement in light of the fact that COVID-19, which is caused by the coronavirus, has the most severe effects on the elderly population, as well as people with pre-existing health conditions like heart disease, cancer, diabetes and compromised immune systems. 

“Medicare beneficiaries are at the greatest risk of serious illness due to COVID-19 and CMS will continue doing everything in our power to protect them,” CMS Administrator Seema Verma said in a prepared statement. She added that the new guidance was aimed removing “barriers that could prevent or delay beneficiaries from receiving care.”

In the new COVID-19 guidance Medicare Advantage and Part D plans can:

  • Waive cost-sharing for testing.
  • Waive treatment cost-sharing, including primary care, emergency department, and telehealth services.
  • Eliminate prior authorizations for treatment.
  • Eliminate prescription refill restrictions.
  • Decrease limitations around home or mail prescription delivery.
  • Increase patient access to telehealth care.

These waivers are aimed at breaking down barriers to accessing care and allow plans to work with pharmacies and providers to treat patients.

Medicare Advantage rule changes

Under the new guidance, if a state of emergency is declared in your state, Medicare Advantage insurers are required to:

  • Cover Medicare Parts A and B services and supplemental Part C plan benefits furnished at non-contracted facilities, as long as they have participation agreements with Medicare.
  • Provide the same cost-sharing for enrollees at non-plan facilities as if the service or benefit had been furnished at a plan-contracted facility.
  • Make changes that benefit the enrollee effective immediately without the typical 30-day notification requirement (such as changes like reductions in cost-sharing and waiving prior authorizations).

The CMS said it would continue toexercise its enforcement discretion regarding the administration of Medicare Advantage plans’ benefit packages in light of the new emergency guidance.

Part D changes

Under the new rules:

  • Part D insurers may relax their “refill-too-soon” rules if circumstances are reasonably expected to result in a disruption in access to drugs. The rules may vary, as long as they provide access to Part D drugs at the point of sale. Part D sponsors may also allow an affected enrollee to obtain the maximum extended day supply available under their plan, if requested and available.
  • Part D insurers must ensure enrollees have adequate access to covered Part D drugs if they have to get their prescription filled at an out-of-network pharmacy in cases when those enrollees cannot reasonably be expected to obtain covered Part D drugs at a network pharmacy.
    Plan cost-sharing levels would still apply and enrollees could be responsible for additional charges (i.e., the out-of-network pharmacy’s usual and customary charge), if any, that exceed the plan allowance.
  • If enrollees are prohibited by a mandatory quarantine from going to a pharmacy to pick up their medications, Part D insurers can relax any plan-imposed rules that may discourage mail or home delivery, for retail pharmacies that choose to offer these delivery services in these instances.
  • Part D insurers may choose to waive prior authorization requirements at any time that they otherwise would apply to Part D drugs used to treat or prevent COVID-19, if or when such drugs are identified. Any such waiver must be uniformly provided to similarly situated enrollees who are affected by the disaster or emergency.

The takeaway

With these new rules and guidelines in place, if you are a Medicare recipient, this news should give you comfort as it should mean reduced costs and access to care and medicine as the outbreak continues.

If you are concerned about coverage, you can contact your Medicare Advantage plan to confirm that it has made the necessary changes to ease the burden on policyholders during the coronavirus crisis.

Small Employers Can Reimburse for Medicare Part B, D Premiums

As the workforce ages and many employers want to keep on baby-boomer staff who have the experience and institutional knowledge that is irreplaceable, one issue that always comes up is how to handle health insurance.

Once your older workers reach the age of eligibility for Medicare, under current law you can help them pay for Part B and D premiums with a Medicare Premium Reimbursement Arrangement. These types of arrangements became legal after legislation was signed into law in 2013 to help employers provide benefits to their Medicare-eligible staff.

But the issue surfaced again recently when the Trump administration came out with new guidance for health reimbursement arrangements that paves the way for employers to set up HRAs to reimburse staff for health premiums in their personal (not company group) health plans.

Anybody who is about to turn 65 has a six-month period to sign up for basic Medicare, but if they want additional coverage they can pay for Medicare supplemental coverage such as Parts B and D.

Part B covers two types of services:

Medically necessary services: Services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice.

Preventive services: Health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best.

Part D, meanwhile, covers prescription drug costs.

The dilemma for employers has often been whether to keep the Medicare-eligible employee on the company health plan or cut them free on Medicare.

Smaller employers – those with 20 full-time-equivalent employees – have the option to open a Medicare Premium Reimbursement Arrangement for those employees if they are coming off a group health plan and into Medicare.

For small employers, it’s legal to set up an arrangement like that, as long as doing so is at the employee’s discretion. Employers are not allowed to push an employee into a Medicare Premium Reimbursement Arrangement in order to get them off the company’s health plan.

The good news for employers is that they often can reimburse their employees in full for Part B and D, as well as Medicare Supplement, and still pay less than they would pay in group employee premiums alone. 

On top of that, the employee gets a lower deductible and overall out-of-pocket experience with less, if any, premium contribution.  

What you need to know

Here’s what you should know if you’re considering one of these arrangements:

A Medicare reimbursement arrangement is one where the employer reimburses some or all of Medicare part B or D premiums for employees, as long as the employer’s payment plan is integrated with the group’s health plan.

To be integrated with the group health plan:

  • The employer must offer a minimum-value group health plan,
  • The employee must be enrolled in Medicare Parts A and B,
  • The plan must only available to employees enrolled in Medicare Parts A and B, or D, and
  • The reimbursement is limited to Medicare Parts B or D, including Medigap premiums.

Note: Certain employers are subject to Medicare Secondary Payer rules that prohibit incentives to the Medicare-eligible population.