“Cures” Act Tips the Scales Even Further in Favor of Medicare Advantage Over Traditional Medicare

January 23, 2018

Industry Updates, Medicare

On December 13, 2016, President Obama signed into law the 21st Century Cures Act (Public Law No: 114-255, also known as “Cures”, H.R. 34).  The bill, which passed with overwhelming bipartisan support, addresses a wide range of issues, including medical research, the drug approval process, and, added in the final days leading up to passage, a number of mental health and Medicare provisions.

In this CMA Alert we discuss some of the provisions in the Cures Act that affect the Medicare program and Medicare beneficiaries.  While some provisions could help Medicare beneficiaries, including through additional education at the time of eligibility, it is unclear whether most of the Medicare-related provisions would help beneficiaries rather than improve compensation for (and reduce the “regulatory burden”) of Medicare providers.  Of most concern to the Center, though, are the following provisions that favor the Medicare Advantage (MA) program over traditional Medicare.

Delay in Authority to Terminate Contracts for MA Plans Failing to Achieve Minimum Quality Ratings

Medicare employs a 5-star quality rating system for MA and Part D plans, in part, in an effort to assist consumers in choosing plans based upon certain performance measures. Plans that receive 4 or 5 stars are eligible for bonus payments, whereas the Centers for Medicare & Medicaid Services (CMS) has the authority to terminate plans that achieve less than 3 stars for 3 consecutive years (often referred to as consistently poor performers). Read more…