CMS levies fewer fines on Medicare Advantage plans

ROBERT KING  March 01, 2019 05:40 PM

Five Medicare Advantage insurers were hit with fines based on 2018 audits—the lowest number of fines imposed by the CMS in four years.

In total, the agency fined the five plans $204,900 for violating Medicare Part C and Part D requirements, it said Thursday. The CMS audited 39 insurers.

The fines levied for 2018 audits pale in comparison to those imposed in prior years. In 2018, the CMS fined 18 insurers roughly $2.5 million resulting from audits the previous year. Before that, 2016 audits resulted in $6.9 million in so-called civil monetary penalties, or CMPs, and 2015 audits led to $8.4 million in fines. An insurer can be penalized for delaying or denying access to covered prescription drugs or services, leading beneficiaries to incur unnecessary out-of-pocket costs.

"The small number and low cost of these fines will be cited by those who believe that the Trump administration is going easy on (Medicare Advantage) plans," said Michael Adelberg, principal at Faegre Baker Daniels Consulting.

The Trump administration has been supportive of the Medicare Advantage program, making it easier for seniors to compare and pick Advantage options. But CMS Administrator Seema Verma denied concerns from advocates that the agency is trying to steer patients to Medicare Advantage over traditional Medicare.

Enrollment in Advantage plans has grown rapidly. The latest federal data shows that 22.4 million people are enrolled in a Medicare Advantage plan this year, an increase of 6.8% compared with January 2018.

The CMS said that a possible reason for the change in fines is due to the size in enrollment of the audited organizations.

"One noticeable difference between 2018 and past audit years is that the average enrollment size of the audited organizations was much smaller than in recent past years," a spokesperson said. "CMPs are imposed when the conditions of non-compliance adversely affected or had a substantial likelihood of adversely affecting enrollees."

So a plan with a large number of enrollees may get a bigger fine if a violation affected a large number of people.

"The amount of a CMP may not correlate with a sponsor's overall level of compliance or performance on an audit," the agency said. "The majority of CMPs are assessed based on the number of impacted enrollees."

https://www.modernhealthcare.com/government/cms-levies-fewer-fines-medicare-advantage-plans