AHA Urges CMS to Swiftly Correct Medicare Advantage Plan Policies That Appear to Violate CY 2024 Rule

November 20, 2023

Meena Seshamani, M.D.
Deputy Administrator and Director
Center for Medicare
Centers for Medicare & Medicaid Services
7500 Security Blvd.
Baltimore, MD 21244

Dear Dr. Seshamani:

On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations and our clinician partners, the American Hospital Association (AHA) strongly supports the Centers for Medicare & Medicaid Services’ (CMS’) efforts to improve how coverage works for Medicare Advantage (MA) enrollees through the policies codified in the calendar year (CY) 2024 MA final rule. These policies, when implemented, will promote more timely access to care, ensure better alignment and coverage parity between Traditional Medicare and MA, and increase oversight of Medicare Advantage Organizations (MAOs).

Recently, we urged CMS to conduct rigorous oversight to monitor compliance with these policies and to ensure that appropriate action is taken in response to any violations. We expressed concerns about reports we have received from our members that certain MAOs have indicated they do not intend to make changes to their utilization management programs in response to the new rule. In other cases, it appears some plans are making changes to the terminology they use in denial letters that may be intended to circumvent recent CMS rulemaking.

Indeed, one plan recently issued guidance to its network providers indicating that they plan to continue using internal criteria beyond the Traditional Medicare criteria to evaluate inpatient admissions. We believe this circumvents CMS’ rules regarding the use of more restrictive coverage criteria and the requirement that plans adhere to certain public accessibility and evidentiary standards. Similarly, we understand from our members that at least one other large, national MAO has reported they will continue to use Milliman Clinical Guidelines (MCG) criteria to evaluate inpatient admissions. And yet another plan has issued a policy that adopts a more stringent standard than CMS for evaluating a physician’s judgement at the time of admission on whether the care was expected to extend over two midnights. We are deeply concerned that these practices will result in the maintenance of the status quo where MAOs apply their own coverage criteria that is more restrictive than Traditional Medicare proliferating the very behavior that CMS sought to address in the final rule, resulting in inappropriate denials of medically necessary care and disparities in coverage between beneficiaries in MA and those in the Traditional Medicare program.

Attached, we provide additional information regarding these potential discrepancies between these plans’ guidance and the CMS rules. In response to these concerns, we urge CMS to take the following actions:

• Clarify that coverage criteria for inpatient admissions are fully established under Traditional Medicare, as set forth in § 412.3, consistent with long-standing CMS policy under Traditional Medicare.
• Clarify that the flexibility for MA plans to supplement Traditional Medicare rules with additional internal coverage criteria is not applicable for medical necessity reviews of inpatient admissions and level of care decisions and should only be used in certain limited circumstances.
• Reinforce expectations to MAOs and confirm MAO compliance with public accessibility and evidentiary standards for internal coverage criteria.
• Take swift action to correct MA plan policies that do not comply with CMS rules, including applying intermediate sanctions where appropriate.

Given the importance of these issues for beneficiaries’ access to care and our hope to address these concerns prior to the effective date of the CY 2024 MA final rule, we respectfully request a meeting as soon as possible to discuss these concerns.

We appreciate your attention to the issues we have raised. And look forward to continuing this conversation. Please feel free to contact me if you have any questions or have a member of your team contact Michelle Kielty Millerick, AHA’s senior associate director of health insurance coverage policy, at mmillerick@aha.org.

Sincerely,

/s/

Ashley Thompson
Senior Vice President
Public Policy Analysis and Development

Attachment A: Examples of Concerns with MAO Policies and AHA Recommendations
Attachment B: Source Material