The Centers for Medicare & Medicaid Services has finalized its rules governing Medicare Advantage plans. Of greatest importance to providers are the changes to the rules governing Medicare Advantage plans’ coverage and medical necessity determinations. As stated in the rules’ preamble, these changes “will ensure that MA organizations provide equal access to Part A and Part B benefits as provided in the Traditional Medicare program” and require that Medicare Advantage organizations “make medical necessity determinations based on internal policies that include coverage criteria that are no more restrictive than Traditional Medicare’s….”
Importantly for providers, the final rules codify requirements that Medicare Advantage plans must comply with Traditional Medicare’s general coverage guidelines, specifically including Traditional Medicare’s coverage criteria for inpatient admissions. These coverage criteria include using the Two Midnight Rule as a benchmark for inpatient admissions and providing inpatient coverage for services on Medicare’s inpatient-only list.
Medical Necessity Determinations and the Use of Commercial Screening Criteria
Also important for providers is the expanded definition of medical necessity, which codified requirements previously in the Medicare Managed Care Manual. The new rules require that Medicare Advantage plans make medical necessity determinations based on Traditional Medicare’s coverage and benefit criteria and the patient’s medical history, including diagnoses and physicians’ recommendations.
There are also new rules governing Medicare Advantage plans’ use of internal criteria to make medical necessity decisions. A recent OIG report had directed CMS to clarify rules governing Medicare Advantage plans’ use of internal guidelines after an audit found that Medicare Advantage plans frequently denied prior authorization for services that would have been covered by Traditional Medicare. The OIG report and feedback from providers and beneficiaries convinced CMS that “guardrails are needed to ensure that utilization management tools are used, and associated coverage decisions are made, in ways that ensure timely and appropriate access to medically necessary care for beneficiaries enrolled in MA plans.”
The rules allow Medicare Advantage plans to develop internal criteria when coverage criteria are not fully established under Medicare. However, the rules require that any such internal criteria be based on evidence from widely used treatment guidelines or clinical literature and that the Medicare Advantage plans make these internal criteria publicly accessible, including a list of sources for the underlying evidence and an explanation of the rational supporting the criteria.
In its comments, CMS specifically addressed commercially available screening criteria, such as InterQual and MCG, which many Medicare Plans have used to deny or delay coverage, stating: “MA plans may not use InterQual or MCG criteria, or similar products to change coverage or payment criteria already established under Traditional Medicare.” Plans are only permitted to use these commercial criteria to “assist in creating internal coverage criteria only so long” as they follow the requirements of the rules for developing internal guidelines.
Adverse Medical Necessity Determinations
The new rules also added a requirement than any partial or fully adverse medical necessity determinations be reviewed by “a physician or other appropriate health care professional with expertise in the field of medicine or healthcare appropriate for the services at issue.” This rule strengthened the previous requirement that the reviewer must only have “sufficient medical or other expertise” but did not go as far as providers would have preferred by requiring review by a physician in the same specialty or subspecialty.
The new rules provide that Medicare Advantage plans cannot use prior authorization other than to “confirm the presence of diagnoses or other medical criteria and/or to ensure that an item or services is medically necessary.” The rules also provide that approval of a prior authorization request must be valid for as long as medically necessary to avoid disruption of care.
The new rules did not change the timeframes for Medicare Advantage plans to approve prior authorization requests, which are currently 72 hours for urgent requests and 14 days for standard requests. The preamble recognized, however, that in its proposed interoperability rules, CMS had requested comments on shortening the period for standard prior authorization requests to 7 days.
The rules also did not require Medicare Advantage plans to implement Gold Carding programs, which eliminate or reduce prior authorization requirements for providers whose prior authorization requests have consistently been approved and/or who have met other evidence-based criteria. CMS had specifically solicited comments on these programs and encouraged their implementation. In the preamble, CMS stated that it will consider these comments in future rulemaking.
Utilization Review Committee
The rules require Medicare Advantage organizations that use utilization management policies, including prior authorization policies, to establish a Utilization Management Committee. A majority of members of the Committee must be physicians, with at least one independent physician free of any conflicts. The Committee must review all of the Medicare Advantage plan’s utilization management policies and procedures at least annually to ensure that they are no more restrictive than Traditional Medicare’s.
Behavioral Health Services
The rules included several provisions intended to ensure that members of Medicare Advantage plans have access to and coverage for behavioral health services. One change of importance to behavioral health providers is that the rules added the phrase “mental or physical” to the definition of “emergency medical services,” which must be followed by Medicare Advantage plans. This change means that Medicare Advantage plans cannot impose prior authorization requirements on the treatment of members experiencing emergency behavioral health conditions and that Medicare Advantage plans must reimburse providers treating members with emergency behavioral health conditions without regard to whether the provider is contracted with the plan.