2020 Part C and Part D Program Audit and Enforcement Report

In record time, the Centers for Medicare & Medicaid Services (CMS) released its 2020 Part C and Part D Program Audit and Enforcement Report.

CMS cautioned readers not to draw conclusions about the overall performance of audited sponsors in 2020 (covering a record low 1.4% enrollment) compared to those that were audited in previous years. Likely for this reason, as well as the fact they considered CMS flexibilities, they removed trending charts where they compared results from past years. Therefore, don’t assume if sponsors did far better in a particular audit area that it is indicative of industry performance or CMS’ auditing. To date, CMS has already exceeded the number of audit notices sent in 2020, so a different picture is surely being painted. Within a three-year period, the sponsors CMS audits represent around 95% of the enrollment of the Medicare Advantage and Part D program, so count on them working to close that gap. 

CMS mentioned that lovely package of overhauled audit protocolCMS-10717, indicating they are still waiting for Office of Management and Budget approval. Delaying implementation of this package, they noted, will give stakeholders sufficient lead-time to apply and test them prior to CMS’ implementation. If you were hoping they would take these back to the drawing board, you may need to re-think your conclusion. If the 95 pages of responses to comments received didn’t make their intent to move forward clear, then this report language should. 

As a result of reviewing enforcement action referrals, CMS provided important recommendations hidden under the description of lessons learned. Get cracking on these! By that, I mean make sure these major themes are incorporated into your next compliance risk assessment. 

  • Sponsors should improve internal processes for monitoring and refunding (when appropriate) overcharges to beneficiaries by contracted and non-contracted providers. Plan sponsors often focus on the test and methodology, reviewing timeliness and clinical decision-making, and benefit adjudication errors may at times fall to the wayside. Incorporate cost-sharing accuracy review into your retrospective processes, and test those benefits in a meaningful way prior to implementation. Mistakes happen in systems, so keep in mind the cost sharing might be accurate in January but fail in April because of something completely unexpected. 
  • Prepare for large enrollment increases in AEP. Most plans do this already – some of the harbingers of an enrollment boost include entering a new service area, offering a new product type, or competitors leaving your market. CMS includes several recommendations to ensure smooth enrollment. 
  • Do not let state requirements fall by the wayside. Yes, D-SNPs and Medicare-Medicaid Plans have quite a bit more interaction with the state than a standard MA-PD or PDP. However, you do not have to offer a D-SNP to miss a state financial licensure requirement. When sponsors fall out of state licensure and fiscal solvency requirements, they fall out of CMS contracting requirements. If your license is renewed annually, make sure you have the right people preparing the renewal, and that the organization stays current on what those state requirements are.