Starting in 2019, Medicare Advantage plans can cover adult day care services, and in-home help with activities such as dressing, bathing and managing medications, a top Trump administration official said Wednesday, according to an article entitled, "Official Gives Hints About Medicare Advantage LTC Benefits," published in ThinkAdvisor. The move might make Medicare Advantage Plans (hereafter "Plans") more attractive alternatives to Medicare.
Seema Verma, the administrator of the Centers for Medicare and Medicaid Services (CMS), spoke about the Medicare Advantage program’s new benefits flexibility at a Medicare conference at CMS headquarters, in Baltimore. CMS announced the changes in April, in a memo sent to potential 2019 Plan issuers. According to the article, while it is not yet clear whether any issuers will add significant supplemental benefits for 2019, "executives from Humana Inc. hinted during their first-quarter earnings call that they might be able to work with partners" to provide such benefits.
According to the article:
Verma told insurance company executives at the conference that CMS hopes its new “reinterpretation” of the Medicare Advantage program benefits rules will help unleash private-sector innovation and creativity. She said she has seen the effects of that creativity in her own life. “Both my parents are enrolled in a Medicare Advantage plan, and they can’t stop talking about them,” Verma said, according to a written version of her remarks distributed by CMS.
The Old Rules
The Medicare Advantage program lets private insurers use a combination of government money and patient premiums to provide an alternative to traditional Medicare coverage. In the past, managers of Medicare Advantage have tried to simplify the Plan shopping process, and discouraged Plans from offering benefits that might drive up health care costs, by putting tight restrictions on the kinds of benefits a Plan issuer can offer. Those restrictions kept Plan issuers from adding benefits such as adult day care benefits, except when the Plans were participating in CMS pilot programs or other special programs.
The New Rules
CMS is employing a new strategy permitting Plans that offer benefits that compensate for physical impairments, reduce the impact of injuries, or reduce avoidable use of emergency rooms. Although Verma did not use the terms “long-term care,” or “short-term care,” in her remarks or written speech, the benefits she described are similar to the kinds of benefits many private long-term care insurance policies offer through home health care and community care provisions. The new approach and resulting rules will also allow Plans to add supplemental benefits tailored to meet the needs of people with specific conditions, including chronic conditions.
The new interpretations are separate from and further expand the chronic care benefits already offered in the Bipartisan Budget Act of 2018 through Medicare. The BBA-2018 provisions expand the range of Medicare supplemental benefits chronically ill enrollees can get starting in 2020.
Requirements for Supplemental Benefits
Of course, the devil is often in the details, and proposed rules were not published. Regardless, the guidance suggests that the additional Plan benefits must ensure the benefits are ”primarily health related,” and "not primarily for a patient’s comfort." The services covered "must be recommended by a physician or other licensed medical professional as part of a care plan," and the new benefits "must not include items or services used to induce enrollment." A Plan can choose to help individuals both with basic “activities of daily living,” such as walking, and with the “instrumental activities of daily living,” such as taking medications correctly.
The new interpretation will let a Plan tailor benefits, such as deductibles or wellness options, to fit people with certain medical conditions, such as diabetes. That interpretation will not, however, allow a Plan to tailor benefits based on an enrollee’s income or poverty level, or any other characteristic other than health status. Plans must use “objective and measurable” criteria to identify eligible enrollees.
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