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CMS Announces 2018 Medicare Advantage and Drug Program Rates

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  • April 4, 2017
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CMS Announces 2018 Medicare Advantage and Drug Program Rates

In an ongoing effort to strengthen the Medicare Advantage and the Prescription Drug Program by supporting flexibility, efficiency, and innovation, the Center Medicare & Medicaid Services (CMS) released final updates to the Medicare Advantage and Part D Prescription Drug Program for 2018.
The final policies are similar to the proposal released in February’s 2018 Advance Notice and Draft Call Letter. There are several changes, however, in response to feedback received during the public comment period.
According to CMS’ April 3 press release, some of the policies in the rate announcement will:

  • Provide flexibility and incentives to encourage organizations to develop new plan offerings
  • Provide incentives for plans to submit complete encounter data
  • Modify the phase-in of the use of encounter data
  • Use encounter data for 15 percent of the risk adjustment payment to Medicare Advantage plans
  • Help combat overuse of opioids by encouraging safeguards before an opioid prescription is dispensed at the pharmacy
  • Employ best practices and the most appropriate care management interventions for enrollees using high dosage opioids

The “Year-to-Year Percentage Change in Payment” is:

Impact 2018
Advance Notice
2018 Rate
Effective Growth Rate 2.8% 2.7%
Rebasing/Re-pricing N/A 0.3%
Change in Star Ratings -0.4% -0.4%
MA coding intensity adjustment -0.25% -0.25%
Normalization -1.9% -1.9%
Expected Average Change in Revenue 0.25% 0.45%
Coding trend 2.5% 2.5%
Expected Average Change in Revenue
with Coding trend
2.75% 2.95%

For more information, read the Fact Sheet “2018 Medicare Advantage and Part D Rate Announcement and Call Letter, and Request for Information” on the CMS website.
CMS is accepting comments on the Request for Information until April 24 at PartCDcomments@cms.hhs.gov. Please include “2017 Transformation Ideas” in the subject line.

Michelle Dick
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Michelle A. Dick, BS, is a freelance content specialist, providing writing, editorial expertise, and graphic imagery to clients. Prior to becoming a free agent, she was an executive editor for AAPC, editor-in-chief at Eli Research, and editor at Element K Journals. After earning a Bachelor of Science from the State University of New York at Buffalo State, Dick entered the publishing industry as a graphic artist, ad coordinator, and web designer for White Directory Publishers, Inc.

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