CMS UPDATE: Advance Notice of 2007 Technical Changes to MA Reimbursement
Here are the highlights from the CMS Advanced Notice of Methodological Changes to 2007 MA Rates and Part D Payments:
GENERAL:
- The National Per Capita Growth percentage is used to baseline the rate tables for 2007. The rate is estimated at 6.9%. It is still not possible to predict the final impact on reimbursement with out knowing the other variables, like the Budget Neutrality and Coding Intensity factors.
PART C:
- The HCC model will be recalibrated for 2007 using 2002 and 2003 Fee For Service data. The current model is based on 1999-2000 data. It is expected that the new model will provide a more accurate prediction between health status and the costs associated with providing care. All segments will be updated (community, long-term institutional, new enrollee, and ESRD). There are no changes to the disease grouping in the model however coefficients (the higher the weight allocated to a grouping the higher the reimbursement). As a result of the recalibration of the HCC model, the frailty factor will also be recalibrated.
- The Fee For Service Normalization factor will be recalibrated for 2007 and will no longer be applied to the rate book but to the risk scores. The expectation is that mathematically the result will be the same. However between recalibrating the HCC model AND applying the FFS Normalization factor to the risk scores, the 2007 risk scores will be substantially different in 2007 and not really an apple-apple comparison to 2006 scores
- In 2007 Pain Management will be added (Medicare code 72) to the qualified specialty type and pain management has been added to the HCC model.
- 100% risk adjustment payments in 2007 for all MA plans except Social Health Maintenance Organizations (S/HMOs), Minnesota Senior Health Options (MSHO)/ Minnesota Disability Health Options (MnDHO), Wisconsin Partnership Program (WPP) and Massachusetts Senior Care Options (SCO) demonstrations who will be 75% risk adjusted in 2007.
- The budget neutrality factor will begin its’ phase out in 2007 with a 45% reduction.
