21st Century Cures Bill Slips in Some Changes to Medicare and Medicaid Programs

What do medical research, Medicaid provider adequacy, and Star Ratings have in common? The 21st Century Cures Act. On January 7, 2016, Congress overwhelmingly passed this piece of legislation – a package of proposals which will provide $6.3 billion for medical research over the next decade.

Despite the broad support from both parties, the legislation is not without criticism. The new bill provides less money than initially proposed and will about take about $3.5 billion from Obamacare’s prevention and public health funds. However, the general consensus is the advancements of the legislation “far outweigh” the concerns, as put by the White House. Adding Vice President Biden’s cancer “moonshot” project, as well as funding for opioid treatment and mental health, into the mix really drives home the fuzzy bipartisan feeling of the act.

And that notion brings our focus back to Medicare and Medicaid. A bill with strong bipartisan support and a plethora of proposals immediately creates the prime opportunity for Congressmen to fulfill their holiday wish lists. Here are some notable standouts:

Medicare Advantage:

  • Delay in Authority to Terminate Contracts for Medicare Advantage (MA) Plans Failing to Achieve Minimum Quality – This provision delays for three years the authority to terminate MA contracts based on plans failing to achieve minimum quality ratings under Star Ratings. This does not prevent the Centers for Medicare & Medicaid Services (CMS) from terminating plans for the other 10 performance categories considered in the Past Cycle Performance Review at any time. “One of CMS’ most important strategic goals is improving the quality of care and health status of beneficiaries, which is measured by the Star Ratings program. It’s hard to imagine plans consistently performing below 3 stars are achieving that goal, and it’s unfortunate CMS’ authority to reinforce this goal has been relaxed through this legislation,” notes Melissa Smith, Vice President of Stars at Gorman Health Group (GHG).
  • Preservation of Medicare Beneficiary Choice under MA – This provision brings back the three-month open enrollment provision. Beginning in 2019, an MA-eligible individual, during the first three months of any year, may now change a previous election to receive benefits through the original Medicare fee-for-service (FFS) program or an MA plan and to elect coverage under part D. This is something we initially predicted would come out in 2017 under Ryan’s agenda but was easily wrapped into the Cures package.
  • Allowing End-Stage Renal Disease (ESRD) Beneficiaries to Choose an MA Plan – This section allows individuals suffering from ESRD to enroll in any MA plan for plan years beginning in 2021. The legislation will remove the standard acquisition costs (SACs) for kidneys from the benchmark and bid. SACs would be compensated for by traditional Medicare. The section also calls for an adjustment to the CMS-Hierarchical Condition Category (HCC) Risk Adjustment Model to improve accuracy by directing the Secretary to take into account the total number of diseases, multiple years of data, and Medicare-Medicaid dual eligibility status.


  • Oversight of Termination of Medicaid Providers – This will require providers participating in Medicaid or the Children’s Health Insurance Program (CHIP) to enroll with the state into an oversight program and will increase required reporting, sharing of information, and standardization of documentation of reasons for termination.
  • Publication of Medicaid FFS Provider Directory – Requires State Medicaid programs to provide beneficiaries served under FFS or primary care case management (PCCM) programs with an electronic directory of physicians participating in the program. The directory would include the physician’s name, specialty, address, and telephone number for each physician serving as a case manager through PCCM programs. Additionally, for physicians serving as case managers, the directory would need to include information on whether the physician is accepting new patients and the physician’s cultural and linguistic capabilities.


  • Medicare Access and CHIP Reauthorization Act (MACRA) Payment Adjustment – Reduces the payment update under MACRA from 0.5% to 0.4588% in fiscal year 2018.
  • Updating the Welcome to Medicare Package – The Secretary of the Department of Health and Human Services (HHS) will be required to revise the pre-Medicare eligibility enrollment notification to include, in a simpler format, the options available under Medicare, including MA, Medicare FFS, and Part D. Stakeholders should expect HHS to quickly reach out as it is required to solicit recommendations on what this notice should include.
  • Enrollment Data Reporting – Requires the Secretary to publish Medicare enrollment data by Congressional District, ZIP code, and state on an annual basis
  • Changes to Medicare Shared Savings Program (MSSP) – This section contains additional requirements to how Medicare FFS beneficiaries are assigned to Accountable Care Organizations (ACOs). The new law would require the basis for assignment to reflect beneficiaries’ utilization of not only primary care services provided by ACO physicians, but also those furnished in federally qualified health centers or rural health clinics.

These are just some of the changes the Medicare and Medicaid programs will see, and the gargantuan bill contains a minutiae of other changes for which organizations should be on notice. Contact us for assistance in digesting these or any other legislative developments.



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