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CMS 2020 Final Call Letter: What you need to know

Read our blog post from earlier this year for information on the 2021 Advance Notice.

Medicare Advantage (MA) enrollment is at an all-time high. As competition among health plans in the MA space increases, a growing list of nontraditional benefit options is giving MA plans the flexibility to address social risk factors and attract new members.

The updates for MA plans were formally announced on April 1, 2019, as CMS released the 2020 Rate Announcement and Final Call Letter, an annual regulatory policy document that establishes payment and coverage policies for MA and Part D plans for the upcoming plan year.

Of particular note, CMS has made additional clarifications for MA plans regarding supplemental benefits for those who are chronically ill. CMS has granted health plans “broad discretion” in covering benefits such as fresh produce for those with heart disease or carpet cleaning for members with asthma, as well as structural improvements that may improve the property value of a home as long as there is an expectation that the project will also improve the health or function of a member. The goal of these expanded benefits is to promote focus on disease prevention, going a long way toward providing evidenced-based care beyond the confines of a medical facility or home health atmosphere – a key component of providing patient-centered care.

2020 Final Call Letter highlights

CMS largely finalized the changes proposed in the Advance Notice and either delayed, or declined to implement, some of the more significant proposals—including tiering related to generic drugs and the inclusion of a new intermediate maximum out-of-pocket (MOOP) option. CMS announced an upward revision to the MA growth rate, which will positively impact health plan revenue and is the only significant adjustment in plan payments from what was proposed in the Advance Notice.

For the third year in a row, CMS finalized a negative adjustment to plan payments to account for changes to plan Star Ratings. CMS additionally identified a variety of future potential new Star measures, measure removals, and changes to existing Star and Display measures.

Gain more insights on the CMS 2020 Final Call Letter

Although there were few substantive changes in policy or procedure finalized, aspects of the Final Call Letter are likely to have a sizable impact on MA and Part D plan design, payment, cost sharing and enrollment. Health plans need to not only ensure they understand the policy implications of the finalized changes but also be prepared to assess and refine internal program strategies to be best positioned for long-term success.

For more information on the impact of this update and how to best prepare, read our full brief on the CMS 2020 Final Call Letter.

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