CHA News Article

Medicare Advantage Rates Increased for CY 2016

The Centers for Medicare & Medicaid Services (CMS) yesterday finalized a 1.25 percent payment increase for Medicare Advantage and Part D prescription drug programs in calendar year 2016, up from a 0.95 percent cut proposed in February. CMS notes that when combined with expected growth in plan risk scores due to coding, payments will increase 3.25 percent on average. CMS also finalized its policy to replace the currently blended risk-adjustment model and calculate risk scores using the 2014 CMS-HCC model. In addition, CMS will continue to use encounter data to develop risk scores, adopted a coding adjustment of 5.41 percent, and reinforced and clarified what it expects from plans regarding the accuracy of provider directories. Notably, CMS did not finalize its proposal to reduce the weight of seven measures in its star rating system to account for concerns raised by the field about the importance of adjusting for dually eligible and low-income subsidy beneficiaries. More information is available in a CMS fact sheet.