Much of what appeared in the 2020 Advance Notice and draft Call
Letter for Medicare Advantage and Part D plans was expected. And while a
proposed rate increase of 1.59% may be the second highest in recent years, it
may not be enough to hold down premiums if MA Prescription Drug (MA-PD) plans
must comply with a new proposed Part D rule, one actuary suggests.
"Overall, we…believe it should not deter the strong
enrollment growth the business has benefited from in recent years," wrote
Oppenheimer & Co., securities analyst Michael Wiederhorn. "However,
investors need to be mindful that the outlook for MA plans will also be
impacted by whether the HIF [health insurer fee] is delayed again for 2020, as
it was for 2019."
Plans should also keep in mind that CMS has not yet completed its annual rebasing exercise, where it looks at the latest five years of available cost data, so that could impact the final rate notice due out April 1, observes Brad Piper with the Milwaukee office of Milliman. And possibly complicating things is a new HHS proposed rule that would take effect on Jan. 1, 2020, and exclude Part D rebates from safe-harbor protections under federal antikickback law.
"At a high level, I think that is likely to result in higher Part D premiums," Piper tells AIS Health.
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