Insurers cheer Medicare Advantage, Part D proposed rule

Medicare enrollment form
CMS’ industry-friendly proposals come at a time when Medicare Advantage has become a booming business for health insurers. (Getty/zimmytws)

The health insurance industry’s major trade group has nothing but good things to say about the federal government’s proposed rule for Medicare Advantage and Part D.

“The proposed rule released by CMS last week would strengthen and improve the Medicare Advantage and Part D programs so they can better support the beneficiaries they serve,” Marilyn Tavenner, president and CEO of America’s Health Insurance Plans, said in a statement on Tuesday.

“These recommendations reflect a strong commitment to improving the patient experience, increasing flexibility and choice, and reducing regulation and red tape,” she added.

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While Tavenner noted that AHIP plans to provide more detailed feedback during the formal comment period, it’s not hard to see why the trade group approves of the newly proposed rule for 2019.

Particularly when it comes to Medicare Advantage, the rule would make several changes aimed at reducing regulatory burden for plans and promoting flexibility—both priorities for the insurance industry. For example, health plans would get more leeway to design benefit packages tailored to enrollees’ health needs, increasing the number of available MA health plans from 2,700 to 3,100.  

The rule also aims to reduce the administrative burden for MA and Part D health plans when reporting medical loss ratio data, and it streamlines regulations governing how health plans communicate and market to patients, among other changes.

CMS’ industry-friendly proposals come at a time when Medicare Advantage has become a booming business for health insurers, sparking new market entrants and fierce competition for enrollees. MA plans currently serve more than one-third of all Medicare beneficiaries.

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The proposals are also likely welcome news to an industry that has seen many of its policy recommendations—such as ensuring cost-sharing reduction payment funding and maintaining the individual mandate—fall on deaf ears in the Trump administration.

The administration has already earned approval from payers and providers alike, however, by releasing a final rule that says the government will test an initiative that allows Medicare Advantage contracts to qualify as advanced alternative payment models under the Medicare Access and CHIP Reauthorization Act.