CMS Releases 2024 Medicare Advantage Final Rate Notice
Today, the Centers for Medicare & Medicaid Services (CMS) released (fact sheet) the Announcement of Calendar Year (CY) 2024 Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies (the Final Rate Announcement). Of note, CMS finalized their risk adjustment model changes as proposed, but will phase in the model over three years. Key provisions in the Final Rate Announcement are outlined below:
- MA Plan Payment Impacts: Increased the average payments from the original proposed 1.03 percent to 3.32 percent. Increased the risk score trend from 3.30 percent to 4.44 percent, reflecting the phase-in of the finalized 2024 risk adjustment model.
- Part C Risk Adjustment Model Revision: Finalized the 2024 proposed Part C risk adjustment model as proposed with a phase in over three years. The proposed model included restructured condition categories using ICD-10 instead of ICD-9, updated underlying FFS data years, and revisions to the model to account for coding variation.
- Inflation Reduction Act of 2022 Updates for 2024: Described several Inflation Reduction Act updates that will be in place for CY 2024, including elimination of cost-sharing of Part D drugs in the catastrophic phase of coverage and expansion of Low-Income Subsidy program (LIS) eligibility from 135 percent to 150 percent.
Earlier this month, the Roundtable submitted comments in response to the proposed 2024 Medicare Advantage (MA) and Part D Advance Notice. In its comments, the Roundtable recognized the importance of periodic updates to MA payment policies while expressing concern that the proposed changes would lead to increased costs for public sector retirees and their dependents who often rely on fixed incomes. The Roundtable letter to CMS can be viewed here.