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Medicare Advantage plans to see 3.4% payment increase in 2019



April 23, 2018
Area(s) of Interest: Payor Issues and Reimbursement Public Payors 

The Centers for Medicare and Medicaid Services (CMS) recently finalized a rule increasing baseline Medicare Advantage payment rates for 2019 by an average of 3.4 percent. That is nearly double the 1.84 percent increase the agency initially proposed earlier this year.


According to CMS, the proposed payment increase is based on better use of encounter data and changes to the risk adjustment model used to pay for aged and disabled beneficiaries. Under the final rule, 75 percent of Medicare Advantage risk scores will be based on traditional fee-for-service data, and 25 percent based on encounter data (up from 15 percent in 2018). The California Medical Association believes this will reduce the Medicare Advantage plan data requests of individual physicians, which could reduce administrative burdens. 


Medicare Advantage participation is at an all-time high, with approximately one-third of all Medicare beneficiaries enrolled in a Medicare managed care plan. Enrollment has more than doubled over the past decade, and is projected to grow by 9 percent to 20.4 million in 2018.

CMS also finalized a policy to prevent Medicare beneficiaries at risk for opioid misuse or abuse from getting prescription drugs from multiple doctors or pharmacies. Beginning in 2019, CMS will allow Medicare Part D plans to restrict at-risk beneficiaries to a single prescriber or pharmacy for access to frequently abused drugs.

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