March 11, 2020

CMS Offers Additional COVID-19 Guidance for Medicare Advantage and Part D Plans

Holland & Knight Healthcare Blog
Melissa A. Wong
Healthcare Blog

The Centers for Medicare and Medicaid Services (CMS) continues to offer guidance related to the coronavirus (COVID-19) outbreak. On March 10, CMS issued a memo to all Medicare Advantage (MA) organizations and Part D sponsors to inform them of their obligations and new discretionary flexibilities related to disasters and emergencies resulting from this outbreak.

Declaration of Disaster or Emergency

Once a state has declared a disaster or emergency, as is the case in eight states to date, MA organizations must abide by certain special requirements set forth in 42 CFR §422.100(m)(1). These obligations include coverage for Medicare A and B as well as supplemental Part C benefits furnished at participating but non-contracted facilities, waiver of requirements for gatekeeper referrals and the application of the same cost-sharing amounts for enrollees as if the care was furnished in network. In addition, CMS waives the usual 30-day notification requirement for plan changes that benefit the enrollee, such as changes to reduce or waive enrollee cost-sharing or the waiver of prior authorization (PA) requirements.

Permitted Benefits During Disaster or Emergency

CMS will permit MA organizations to waive or reduce enrollee cost-sharing for items and services intended to address the outbreak, such as for COVID-19 laboratory tests or telehealth benefits. While these benefits are discretionary, any benefits that the MA organization decides to apply must be provided to all similarly situated plan enrollees on a uniform basis. CMS confirms, through consultation with the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS), that these voluntary cost-sharing reductions and waivers are protected under the federal anti-kickback statute safe harbors. CMS and OIG also confirm that the expansion of telehealth services beyond those included in a plan's approved benefit package similarly satisfies anti-kickback statute safe harbor requirements. Finally, MA organizations may choose to waive PA requirements that would otherwise apply to laboratory tests and other items and services related to COVID-19.

Continued Access to Part D Drugs

Part D sponsors may relax "refill too soon" edits and allow enrollees to obtain the maximum extended supply of their medications if the enrollee's circumstances are reasonably expected to result in a disruption in access to their medication. Sponsors will have discretion as to how to apply any edits as long as access to drugs is provided at the point-of-sale. In addition, Part D sponsors must reimburse enrollees for prescriptions obtained from out-of-network pharmacies if enrollees cannot reasonably be expected to obtain covered drugs at a network pharmacy. Enrollees, however, remain responsible for any cost-sharing and additional charges that would apply. For enrollees who have difficulty with or are prohibited from visiting a retail pharmacy, such as those who are under quarantine, Part D sponsors may voluntarily relax any policies that would discourage certain methods of delivery, such as mail order or home delivery, for retail pharmacies that choose to offer these services. Any permissive benefits implemented during a disaster or emergency must be uniformly provided to all similarly situated enrollees.

Requirements for COVID-19 Drugs

If and when Part D drugs to treat or prevent COVID-19 become available, Part D sponsors may choose to waive PA requirements as long as the waiver is uniformly provided to similarly situated enrollees who are affected by the disaster or emergency. Either Medicare or Part D plans will be required to cover a COVID-19 vaccine, again if and when a vaccine becomes available.

DISCLAIMER: Please note that the situation surrounding COVID-19 is evolving and that the subject matter discussed in these publications may change on a daily basis. Please contact the author or your responsible Holland & Knight lawyer for timely advice.

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