[Updated] CMS to Test Hospice Carve-In Under Medicare Advantage

The Medicare Advantage (MA) carve-in that many industry insiders pegged as “inevitable” has finally arrived.

The Centers for Medicare & Medicaid Innovation (CMMI) on Friday morning announced it is expanding the MA Value-Based Insurance Design (VBID) model, using VBID to test out several wide-ranging updates to MA offerings, including a hospice carve-in set to take effect in 2021. Hospice care is currently not allowed as a benefit covered in MA plans.

The Centers for Medicare & Medicaid Services (CMS) introduced VBID in seven states in 2017, opting to expand the model in 2018 and again in 2019. Language included in the Bipartisan Budget Act of 2018 requires VBID to include all 50 states and territories by 2020.


Although CMS’ updates to VBID allow for more benefits focused on managing chronic conditions and telehealth services, its groundbreaking move to open the door for hospice in the MA program likely has the bigger potential impact.

Specifically, beginning in the 2021 plan year, the VBID model will test allowing Medicare Advantage plans to offer Medicare’s hospice benefit. The change is designed to increase access to hospice services and facilitate better coordinate between patients’ hospice providers and their other clinicians, according to CMS officials.

In addition to updating the CBID model for Medicare Advantage, CMS also highlighted notable changes to the Part D Payment Modernization model related to lowering prescription drug prices.


“The American health care system is very different today than it was 13 years ago when the Medicare Advantage and Part D programs were launched in their current forms, but due to the slow pace of change in government, these programs have not been fully updated to reflect today’s realities,” CMS Administrator Seema Verma said in a statement. “Today’s announcements are prime examples of how CMMI can test policies to modernize CMS programs and ensure that our seniors can access the latest benefits.”

Federal health care policymakers plan to monitor the impact of Friday’s changes to the respective models moving forward. If successful in improving quality of care and reducing medical costs, the models can be expanded in scope.

“Clearly, the big issue for us is CMS’ announced plan to test coverage of hospice as part of the MA benefit — and this is a big deal,” Theresa Forster, the National Association for Home Care & Hospice’s vice president for hospice policy, told Home Health Care News. “However, we also note CMS’ interest in reducing spending under Part D, and given the attention over the last several years related to spending under Part D for hospice patients, this is an area we will also closely reviewed to determine whether there is any direct impact.”

Besides opening the door for a hospice carve-in, other important updates geared toward 2020 include allowing MA plans to provide reduced cost sharing and additional benefits to enrollees in a more targeted fashion than has previously been allowed, including customization based on chronic condition, socioeconomic status — or both. That customization even applies for benefits not primarily related to health care, such as transportation, a major serve line for several home health and home care providers.

Additionally, starting in calendar 2020, participating Medicare Advantage plans can provide telehealth services as a replacement for in-person visits, as long as the plans continue to cover face-to-face appointments for the same issues

The deadline for plans to apply to participate in the VBID in 2020 is March 1.

“It is unclear whether or not VBID-participating plans will be required to cover hospice, although we anticipate that coverage would be based on a plan’s decision,” Forster said. “Coverage could start out slowly. But this starts the ball rolling on a change that could have a very dramatic impact on the hospice benefit, hospice programs and hospice beneficiaries.”

CMS has steadily chipped away at the MA program’s rigidity since the start of 2018.

In April, CMS officially announced that certain in-home care services would be allowed as supplemental benefits for MA plans in 2019. Plans have already begun taking advantage of the newfound flexibility by offering home-focused benefits, though home care experts expect the bulk of that opportunity to come in 2020 or 2021.

Alexandria,Virginia-based National Hospice and Palliative Care Organization (NHPCO) partnered with the Better Medicare Alliance in August. NHPCO leadership described the partnership as a means to help figure out what a possible policy carve-in for hospice under the MA program would look like.

Expanding the Medicare Advantage program has been a hot topic, especially as benefificaires continue to enroll in MA plans over traditional Medicare.

MA enrollment is projected to be at an all-time high in 2019, with 22.6 million beneficiaries signed up for the program, according to CMS. Based on projected enrollment, 36.7% of Medicare beneficiaries will be enrolled in Medicare Advantage in 2019.

As an organization, NAHC has largely opposed a broad hospice MA carve-in, Forster said.

“We have a host of concerns based on our home health members’ experience with Medicare Advantage,” she said. “These include the fact that many plans do not offer the same home health benefit as is provided under fee-for-service, pay reduced rates for coverage, require prior authorization and are extremely late in making payment. These issues are very troublesome.”

Additionally, MA plans have strong incentives to secure care at the lowest cost possible, Forster said, noting that incentives are not balanced out by quality measures that make the plans accountable for supplying high-quality, well-coordinated care for patients with advanced and terminal illness. NAHC also has concerns about possible tensions that may arise between determinations of need made by the hospice interdisciplinary team and the MA plan about coverage of services and supplies — including different levels of care.

NAHC plans to review details on CMS’ plans as they are released and is seeking additional dialogue with agency officials.

Similar to NAHC, NHPCO has also expressed concerns about a hospice MA carve-in.

“First and foremost, NHPCO is concerned about any changes that will adversely impact patient and family access to care,” NHPCO President Edo Banach said in a statement provided to HHCN. “To the extent that this expansion of [VBID] is about enhanced access and a potential opportunity to ensure that more beneficiaries will get better interdisciplinary care when it is most appropriate, we are encouraged. If this demonstration restricts choice and access, we will take appropriate action.”

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