Plans' misclassification of Part D coverage determinations
and/or redeterminations as grievances and/or customer service inquiries topped
the list of commonly cited conditions requiring immediate corrective action
last year, affecting 64% of audits, observed CMS in the 2017 Part C and Part D
Program Audit and Enforcement Report released May 8.
Followed misclassifications is Part D sponsors' failure to identify and process enrollee complaints and disputes as grievances, which was never previously among the most commonly cited conditions.
Based on 2017 referrals, CMS last year and in early 2018 imposed 24 civil monetary penalty notices amounting to $2.9 million, or an average CMP of roughly $120,000.
The figure is far less than the $7.5 million ($358,000 on average) that 21 insurers were fined based on 2016 referrals. CMS officials explained that the difference was due to fewer violations per CMP and a smaller enrollment size per sponsor. The latest report showed that the average enrollment size of those audited in 2017 was approximately 240,000, compared with 650,000 in 2016.
The 2017 audit report highlighted five common conditions cited as Immediate Corrective Action Required: the misclassification of coverage determinations or determination requests resulted in 22 ICARs, while a sponsor’s failure to properly administer the CMS-approved formulary by applying unapproved utilization management practices was cited 12 times and affected 67% of audits, said CMS.
According to the recent audit report, non-compliance found during one-third financial audits accounted for 20 (or 21% out of 93 total) referrals for enforcement action, but 12 were closed out and eight are still under review.
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