Navigating the ever-changing landscape of healthcare management, providers find themselves in an intricate dance with Medicare Advantage Organizations (MAOs). This relationship is often marked by frequent and often erroneous denials.
Despite long-standing regulatory guidance, Medicare Advantage (MA) programs' lack of adherence leaves Healthcare organizations financially strained and limits beneficiaries’ access to essential care.
Prompted by this glaring issue, the regulatory landscape has gotten brighter for providers and beneficiaries with the introduction of the Centers for Medicare & Medicaid Services (CMS) 4201 Final Rule. This regulation emerges as a tool for healthcare organizations nationwide to arm themselves in the fight against inappropriate denials. The Final Rule aims to ensure that Medicare beneficiaries who enroll in MA programs receive the same items and services as beneficiaries in the Fee For Service (FFS) program and that providers are appropriately reimbursed for their services.
When Did MA Denials Become The Status Quo?
A shocking 2018 Office of Inspector General (OIG) report revealed that approximately 75% of MAO appeals resulted in an overturn of the original denial, equating to nearly 216,000 denial reversals annually. This figure highlights a significant flaw in the initial determinations. Unfortunately, the OIG further noted that a stark 1% of Medicare Advantage denials were appealed.
"The concern raised by the OIG was not simply that many MA beneficiaries and healthcare providers were being denied payments for services that should have been initially covered," says Corro Clinical’s Vice-President of Regulatory Affairs, Angela Sorbelli," but also that beneficiaries and providers typically do not resort to the MA appeal process." This unwillingness to pursue administrative remedy has evolved into a silent acceptance of these erroneous denials.
Despite being required to provide benefits and reimbursements at least equal to traditional Medicare, as stated in myriad regulations before CMS-4201-F, MAOs' failure to apply Medicare criteria continues to result in coverage that falls woefully short of traditional Medicare. This discrepancy arises when MAOs deviate from traditional Medicare rules and utilize commercial criteria to determine service coverage. The standards used by these proprietary criteria are more stringent than those of traditional Medicare, an approach Dr. Jerilyn Morrissey, Chief Medical Officer at CorroHealth, deems violative of the fundamental CMS intent.
Empowering Providers and, Hopefully, Lowering Denials
The CMS 4201 Final Rule was introduced and released on April 5, 2023, and was formally published in the Federal Register on April 12, 2023, to codify pre-existing and long-standing Medicare regulations and sub-regulatory guidance. The Rule explicitly states that traditional Medicare guidance and criteria do apply to MA plans, aiming to reduce the frequency of denials from MAOs, thereby helping healthcare organizations recover financially and ensuring patients receive the care to which they are entitled. The Rule also states Coverage Rule and Payment Rule both address the scope regarding the determinations. For Medicare Part A or B to cover an item or service, MAOs need to assess its medical necessity using National Coverage Determinations (NCDs), Local Coverage Determinations (LCDs) and other regulatory standards in existence to determine if it is appropriate. In addition, the Rule states that MAO organizations must adhere to the Traditional Medicare coding policies and may not use internal coding rules criteria for determinations.
"When CMS was asked about proprietary coverage criteria and tools such as InterQual or MCG Milliman, could Medicare Advantage organizations use them? the question was asked and answered,” explains Dr. Morrissey. “The response was that the use of these tools in isolation without compliance to the requirements in this final rule is prohibited. Thus, Medicare Advantage plans may not use InterQual or MCG criteria or similar products to change coverage or payment criteria already established under traditional Medicare laws.”
For providers, denials equate to lost revenue and additional administrative burden to appeal the denial. On the other hand, patients often face unexpected out-of-pocket expenses, experience delays in receiving necessary medical care, or, in some severe cases, completely lose access to critical health services.
A Tool to Fight Back
The CMS 4201 Final Rule provides a wealth of opportunities to fight against this egregious MAO behavior. The goal of the Rule, which codifies long-standing guidance, is to decrease the rate of inappropriate denials by MAOs. It is a testament to CMS's responsibility to hold payers accountable and ensure denials are made with appropriate and transparent justification.
Dr. Morrissey lauds the CMS 4201 Final Rule, stating, "CMS 4201 is a wonderful tool. It should fill your toolbox with approaches, strategies, and guidance. It's a tool by which hospitals and providers should draw strength and empowerment to help CMS hold MA plans accountable to the regulations."
About CorroHealth
About CorroHealth: CorroHealth is the leading provider of clinically-led healthcare analytics and technology-driven solutions dedicated to positively impacting the financial performance of hospitals and health systems. With over 8,500 employees worldwide, CorroHealth delivers integrated solutions, proven expertise, intelligent technology, and scalability to address needs across the entire revenue cycle.