We knew greater CMS scrutiny of provider networks was coming…

By Julie Mason

…and we now have our first glimpse of what that will look like.  In an HPMS memo date January 10, CMS confirmed that the OMB (Office of Management and Budget) approved CMS’ proposed change to network oversight, including removal of health services delivery (HSD) tables from the initial and service area expansion (SAE) application process, and a move to a 3-year provider network review cycle for ALL contracted Medicare Advantage (MA) plans.

The memo provided a few additional details not previously disclosed to the industry.  One, for those MA plans selected for the 2018 review cycle, networks will be due to CMS in June, and CMS will provide at least 60 days’ notice prior to the due date.  If you haven’t been continuously monitoring your provider network against the CMS HSD Reference File (which tells you how many of which type of provider/facility you need and where in your service area), 60 days will be woefully inadequate in assessing your network and filling provider gaps.  Based on personal experience in the MA world, many MA plans, if not most, have not been diligently monitoring their provider networks.  So today’s memo is a blaring wake-up call to get going on this time- and labor-intensive process immediately.  With a 3-year cycle, that means approximately one third of all MA plans will be selected for this year’s network review.  Yikes.

Two, initial and SAE applicants will have until sometime in June to submit their proposed networks.  This provides some much-needed relief from the February application deadline imposed on applicants in previous years.  Additionally, unlike SAE applicants in 2017, CMS will only review the network in the expanded service area for SAE applicants, rather than both the current and expanded networks.  The memo doesn’t specify whether the current network of an SAE applicant will be subject to the 3-year network review in 2018.

Three, in February, CMS will allow all plans to submit their networks in the Network Management Module (NMM) of HPMS for an informal CMS review.  This appears to be an opportunity for MA plans to get guidance from CMS on the state of their current network, prior to potentially being selected for a 2018 formal network review.  Despite a natural inclination against revealing your network to CMS if you don’t have to, I’d advise taking advantage of this opportunity.  You may get some helpful guidance and insights from CMS, especially if you previously had or now need CMS to grant exceptions for certain specialties in certain areas.

Four, CMS may impose compliance and/or enforcement actions on MA plans failing network adequacy requirements in the 2018 review.  And initial and SAE applicants that do not have a compliant network in place by January 1, 2019 may also be subject to such penalties.  Historically, CMS has not often imposed harsh penalties identified in the initial phases of a new initiative, but CMS’ clear statement on this in the January 10 memo leaves the door wide open for them to do so.  Given that network requirements have been shared with the industry for years, CMS has surer footing to take such actions in the early stages of this initiative.

Finally, those MA plans reviewed in 2018 who are out of compliance with CMS’ provider requirements will be required to allow members to see non-contracted specialists at the contracted provider cost-sharing level for the counties and specialties that do not meet the network criteria.  This has implications for many areas of health plan operations, from sales and marketing to claims processing, utilization management, and appeals and grievances.

My advice: run, don’t walk, to your Network Management department today and get your network in compliance.  Despite the resources it may take to whip the network into shape now, it is guaranteed to be far less than cleaning up the mess that CMS may find this summer if you are one of the lucky winners of the CMS network lottery.

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