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Medicare Rights Comments on 2020 Draft Rate Notice and Call Letter

Each year, the Centers for Medicare & Medicaid Services (CMS) releases a draft rate notice and call letter, which outlines rules and payment policies that will apply to Medicare Advantage plans in the upcoming plan year. Interested parties—including plans, beneficiaries, and advocates—can submit comments in response, which CMS takes into consideration when finalizing its proposal. The agency then releases a final rate notice and call letter in the spring, which contains information that plans use to submit their bids to offer Medicare Advantage and Part D plans.

This year, part of the draft call letter implements the Bipartisan Budget Act of 2018, which allows plans to offer non-primarily health related supplemental benefits to people with chronic illnesses. In recent CMS guidance surrounding this flexibility, the agency has allowed plans to broadly define “chronic illness” and to significantly expand the types of supplemental benefits a plan may offer. Medicare Rights’ comments focused, in part, on how beneficiaries will learn about these benefits and their right to access them. We were encouraged to see that CMS will require plans to use the standard appeals process for disputes related to coverage of supplemental benefits, but we urged CMS to also require plans to make the standards for coverage publicly available and easily understandable.

CMS also proposed to make more changes to the tiering structures allowed in Part D, by eliminating any tiers that combine brand name and generic drugs. CMS argues that such a change will lead to increased adoption of generic and lower-cost medications and will aid beneficiaries in plan selection. We support this proposal, which would create simplified tiering structures that encourage generic and biosimilar utilization—resulting in cost savings for people with Medicare and the program itself. We encourage CMS to explore other opportunities to reduce the complexity of formularies and tiers, and to adopt policies that simplify shopping for and comparing plans.

Read our comments here.

Read the draft rate notice and 2020 call letter here.

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