CMS Suspends Medicare Advantage Enrollment, Fines Quality Health Plan

The Centers for Medicare & Medicaid Services issued two notices to Tampa, Fla.-based Quality Health Plan with intent to impose intermediate sanctions and a civil monetary penalty on QHP for failure to comply with a number of administrative and contract management requirements, according to a CMS news release.

The first notice of intent suspends QHP's marketing and enrollment of new members in its two Medicare Advantage health plans and a stand-alone prescription drug plan. A second notice of intent imposes a fine of $586,800 against QHP based on the adverse impact or substantial likelihood of adverse impact that QHP's premium billing violations had on their enrollees, according to the release. Around 17,400 Medicare beneficiaries in New York and Florida are currently enrolled in QHP's Medicare contracts, and most should experience no problems.

The notices come after CMS discovered that QHP had not been billing beneficiaries for their premiums since Jan. 2008, and then recently sent enrollees a lump sum bill for the entire amount of back premium, in some cases up to $1,000, with no payment options, according to the release. QHP's current stand-alone prescription drug plan enrollees are largely comprised of low income subsidy beneficiaries, and the average lumped premium bill was around $332, which placed many enrollees in a difficult situation.

Following an extensive review of denied claims documents and an on-site audit at QHP's Tampa headquarters, CMS found that the plan had failed to fully meet obligations to Medicare beneficiaries by not providing them with timely monthly premium invoices, denying their coverage of approved Part D prescription drugs and the plan's contradictory and inappropriate payments for medications that are specifically excluded on CMS's drug formulary, according to the release.

Under the sanction, CMS will closely monitor the plan to determine that corrective actions have been taken and, if new issues arise, may impose additional penalties and may consider the possibility of termination of the QHP contract with Medicare.

Read the release about CMS's sanction of QHP.