[Federal Register Volume 81, Number 163 (Tuesday, August 23, 2016)]
[Proposed Rules]
[Pages 57554-57558]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-20034]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 402, 420, and, 455

[CMS-6074-NC]
RIN 0938-ZB31


Request for Information: Inappropriate Steering of Individuals 
Eligible for or Receiving Medicare and Medicaid Benefits to Individual 
Market Plans

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Request for information.

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SUMMARY: This request for information seeks public comment regarding 
concerns about health care providers and provider-affiliated 
organizations steering people eligible for or receiving Medicare and/or 
Medicaid benefits to an individual market plan for the purpose of 
obtaining higher payment rates. CMS is concerned about reports of this 
practice and is requesting comments on the frequency and impact of this 
issue from the public. We believe this practice not only could raise 
overall health system costs, but could potentially be harmful to 
patient care and service coordination because of changes to provider 
networks and drug formularies, result in higher out-of-pocket costs for 
enrollees, and have a negative impact on the individual market single 
risk pool (or the combined risk pool in states that have chosen to 
merge their risk pools). We are seeking input from stakeholders and the 
public regarding the frequency and impact of this practice, and options 
to limit this practice.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. on September 22, 
2016.

ADDRESSES: In commenting, refer to file code CMS-6074-NC. Because of 
staff and resource limitations, we cannot accept comments by facsimile 
(FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to http://www.regulations.gov. Follow the ``Submit a 
comment'' instructions.
    2. By regular mail. You may mail written comments to the following 
address ONLY: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-6074-NC, P.O. Box 8010, 
Baltimore, MD 21244-8010.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address ONLY: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-6074-NC, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    4. By hand or courier. Alternatively, you may deliver (by hand or 
courier) your written comments ONLY to the following addresses:
    a. For delivery in Washington, DC--

Centers for Medicare & Medicaid Services, Department of Health and 
Human Services, Room 445-G, Hubert H. Humphrey Building, 200 
Independence Avenue SW., Washington, DC 20201.

    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without Federal government 
identification, commenters are encouraged to leave their comments in 
the CMS drop slots

[[Page 57555]]

located in the main lobby of the building. A stamp-in clock is 
available for persons wishing to retain a proof of filing by stamping 
in and retaining an extra copy of the comments being filed.)
    b. For delivery in Baltimore, MD--

Centers for Medicare & Medicaid Services, Department of Health and 
Human Services, 7500 Security Boulevard, Baltimore, MD 21244-1850.

    If you intend to deliver your comments to the Baltimore address, 
call telephone number (410) 786-9994 in advance to schedule your 
arrival with one of our staff members.
    Comments erroneously mailed to the addresses indicated as 
appropriate for hand or courier delivery may be delayed and received 
after the comment period.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Morgan Burns, 301-492-4493.

SUPPLEMENTARY INFORMATION: 
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://www.regulations.gov. Follow the search instructions on that Web site to 
view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 
three weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1-800-743-3951.
    This is a request for information only. Respondents are encouraged 
to provide complete but concise responses to the questions listed in 
the sections outlined below. Please note that a response to every 
question is not required. This RFI is issued solely for information and 
planning purposes; it does not constitute a Request for Proposal, 
applications, proposal abstracts, or quotations. This RFI does not 
commit the Government to contract for any supplies or services or make 
a grant award. Further, CMS is not seeking proposals through this RFI 
and will not accept unsolicited proposals. Responders are advised that 
the U.S. Government will not pay for any information or administrative 
costs incurred in response to this RFI; all costs associated with 
responding to this RFI will be solely at the interested party's 
expense. Not responding to this RFI does not preclude participation in 
any future procurement, if conducted. It is the responsibility of the 
potential responders to monitor this RFI announcement for additional 
information pertaining to this request. Please note that CMS will not 
respond to questions about the policy issues raised in this RFI. CMS 
may or may not choose to contact individual responders. Such 
communications would only serve to further clarify written responses. 
Contractor support personnel may be used to review RFI responses. 
Responses to this notice are not offers and cannot be accepted by the 
Government to form a binding contract or issue a grant. Information 
obtained as a result of this RFI may be used by the Government for 
program planning on a non-attribution basis. Respondents should not 
include any information that might be considered proprietary or 
confidential. This RFI should not be construed as a commitment or 
authorization to incur cost for which reimbursement would be required 
or sought. All submissions become Government property and will not be 
returned. CMS may publically post the comments received, or a summary 
thereof.

I. Background

    The Centers for Medicare & Medicaid Services (CMS) believes that 
when health care providers or provider-affiliated organizations steer 
or influence people eligible for or receiving Medicare and/or Medicaid 
benefits, it may not be in the best interests of the individual, it may 
have deleterious effects on the insurance market, including disruptions 
to the individual market risk pool, and it is likely to raise overall 
healthcare costs. Individuals eligible for Medicare and/or Medicaid 
benefits are not required to enroll in these programs.\1\ However, 
individuals eligible for Medicaid or Medicare Part A benefits are 
generally ineligible for the premium tax credit (PTC), including 
advance payments thereof (APTC), and for cost-sharing reductions (CSR) 
for their Qualified Health Plan (QHP) coverage for the months they have 
access to minimum essential coverage (MEC) through the Medicare or 
Medicaid programs.\2\
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    \1\ Individuals eligible to receive premium free Medicare Part A 
benefits may not decline Medicare Part A entitlement if they accept 
Social Security benefits.
    \2\ See 26 U.S.C. 36B. In general, an individual who is eligible 
for minimum essential coverage (other than coverage in the 
individual market) for a month is ineligible for the premium tax 
credit for that month. Medicare part A and most Medicaid programs 
are minimum essential coverage. See 26 U.S.C. 5000A(f) and 26 CFR 
1.5000A-2(b).
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    We have heard anecdotal reports that individuals who are eligible 
for Medicare and/or Medicaid benefits are receiving premium and other 
cost-sharing assistance from a third party so that the individual can 
enroll in individual market plans for the provider's financial benefit. 
In some cases, a health care provider may estimate that the higher 
payment rate from an individual market plan compared to Medicare or 
Medicaid is sufficient to allow it to pay a patient's premiums and 
still financially gain from the higher reimbursement rates. Issuers are 
not required to accept such payments from health care providers or 
provider-affiliated organizations, as described below. Enrollment 
decisions should be made, without influence, by the individual based on 
their specific circumstances, and health and financial needs. CMS has 
established standards for enrollment assisters, including navigators, 
which prohibit gifts of any value as an inducement for enrollment, and 
require information and services to be provided in a fair, accurate, 
and impartial manner.\3\ Additionally, CMS has established standards 
for insurance agents and brokers that register with the Federal 
Marketplace, including training about the interaction of Medicare and 
Medicaid eligibility with eligibility for individual market plans and 
financial assistance, and has remedies for insurance agents that 
provide inaccurate or incorrect information to consumers, such as 
misinformation about the impact of not enrolling in Medicare when an 
individual first becomes eligible, including termination of the 
Marketplace agreement, civil monetary penalties, and denial of right to 
enter agreements in future years.\4\
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    \3\ 45 CFR 155.210.
    \4\ 45 CFR 155.220.
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    We believe there is potential for financial harm to a consumer when 
a health care provider or provider-affiliated organization (including a 
non-profit organization affiliated with the provider) steers people who 
could receive or are receiving benefits under Medicare and/or Medicaid 
to enroll in an individual market plan. The potential harm is 
particularly acute when the steering occurs for the financial gain of 
the health care provider through higher payment rates

[[Page 57556]]

without taking into account the needs of these beneficiaries. People 
who are steered from Medicare and Medicaid to the individual market may 
also experience a disruption in the continuity and coordination of 
their care as a result of changes in access to their network of 
providers, changes in prescription drug benefits, and loss of dental 
care for certain Medicaid beneficiaries. If an individual receives the 
benefit of APTC for a month he or she is eligible for minimum essential 
coverage, the individual (or the person who claims the individual as a 
tax dependent) may be required to repay some or all of the APTC at the 
time such person files his or her federal income tax return. Moreover, 
it is unlawful to enroll an individual in individual market coverage if 
they are known to be entitled to benefits under Medicare Part A, 
enrolled in Medicare Part B, or receiving Medicaid benefits. 
Importantly, those eligible for Medicare may be subject to late 
enrollment penalties if they do not enroll in Medicare when first 
eligible to do so--a monthly premium for Part B may go up 10 percent 
for each full 12-month period an individual could have had Part B, but 
did not sign up for it.\5\ Individuals who become eligible for Medicare 
based on receipt of Social Security benefits based on age or Social 
Security Disability Insurance (SSDI) must forgo and if received repay 
their Social Security cash benefits if they wish to decline Medicare 
Part A benefits.\6\ Additionally, individuals who are steered into an 
individual market plan for renal dialysis services and then have a 
kidney transplant while enrolled in the individual market plan will not 
be eligible for Medicare Part B coverage of their immunosuppressant 
drugs if they enroll in Medicare at a later date.\7\
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    \5\ https://www.medicare.gov/your-medicare-costs/part-b-costs/penalty/part-b-late-enrollment-penalty.html.
    \6\ https://www.cms.gov/Outreach-and-Education/Find-Your-Provider-Type/Employers-and-Unions/Top-5-things-you-need-to-know-about-Medicare-Enrollment.html.
    \7\ https://www.medicare.gov/coverage/prescription-drugs-outpatient.html.
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    Federal regulations at 45 CFR 156.1250 require that issuers 
offering Qualified Health Plans (QHPs), including stand-alone dental 
plans, and their downstream entities, accept premium and cost-sharing 
payments on behalf of QHP enrollees from the following third-party 
entities (in the case of a downstream entity, to the extent the entity 
routinely collects premiums or cost sharing): (a) A Ryan White HIV/AIDS 
Program under title XXVI of the Public Health Service Act; (b) an 
Indian tribe, tribal organization, or urban Indian organization; and 
(c) a local, state, or Federal government program, including a grantee 
directed by a government program to make payments on its behalf.\8\ 
Issuers are not required to accept such payments from other entities. 
These regulations were finalized in the 2017 HHS Notice of Benefit and 
Payment Parameters Final Rule, which made several amendments to the 
regulations previously codified through a March 19, 2014, HHS Interim 
final rule (IFR) with comment period titled, Patient Protection and 
Affordable Care Act; Third Party Payment of Qualified Health Plan 
Premiums (79 FR 15240).
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    \8\ 2017 HHS Payment Notice Final Rule.
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    Prior to publishing the IFR, HHS issued two ``Frequently Asked 
Questions'' (FAQ) documents regarding premium and cost-sharing payments 
made by third parties on behalf of individual market plan enrollees. In 
an FAQ issued on November 4, 2013 (the November FAQ), HHS discouraged 
QHP issuers from accepting third-party payments made on behalf of 
enrollees by hospitals, other health care providers, and other 
commercial entities due to concerns that such practices could skew the 
insurance risk pool and create an unlevel field in the Exchanges. The 
FAQ also noted that HHS intended to monitor this practice and to take 
appropriate action, if necessary.
    On February 7, 2014, HHS issued another FAQ (the February FAQ) 
clarifying that the November FAQ did not apply to third party premium 
and cost-sharing payments made on behalf of enrollees by Indian tribes, 
tribal organizations, and urban Indian organizations; state and Federal 
government programs (such as the Ryan White HIV/AIDS Program); or 
private, not-for-profit foundations that base eligibility on financial 
status, do not consider enrollees' health status, and provide 
assistance for an entire year. In the February FAQ, HHS affirmatively 
encouraged QHP issuers to accept payments from Indian tribes, tribal 
organizations, and urban Indian organizations; and state and Federal 
government programs (such as the Ryan White HIV/AIDS Program) given 
that Federal or state law or policy specifically envisions third party 
payment of premium and cost-sharing amounts by these entities.
    CMS seeks to clarify that offering premium and cost-sharing 
assistance in order to steer people eligible for or receiving Medicare 
and/or Medicaid benefits to individual market plans for a provider's 
financial gain is an inappropriate action that may have negative 
impacts on patients. CMS is strongly encouraging any provider or 
provider-affiliated organization that may be currently engaged in such 
a practice to end the practice. As noted above, enrollment decisions 
should be made based on an individual's particular financial and health 
needs.
    As we assess the extent of potential steering activities, its 
impact on beneficiaries and enrollees and the individual market single 
risk pool, CMS reminds healthcare providers and other entities that may 
be engaged in such behavior that we have several regulatory and 
operational tools that we may use to discourage premium payments and 
routine waiver of cost-sharing for individual market plans by health 
care providers, including, but not limited to, revisions to Medicare 
and Medicaid provider conditions of participation and enrollment rules, 
and imposition of civil monetary penalties for individuals who failed 
to provide correct information to the Exchange when enrolling consumers 
into QHPs.\9\ CMS is also working closely with federal, state and local 
law enforcement to investigate instances of potential fraud and abuse, 
as well as collaborating with private and public health plans on 
provider fraud in the Healthcare Fraud Prevention Partnership.\10\ We 
are exploring ways to use our existing authorities to impose civil 
monetary penalties on health care providers when their actions result 
in late enrollment penalties for Medicare eligible individuals who were 
steered to an individual market plan and delayed Medicare enrollment.
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    \9\ 45 CFR 155.285 Bases and process for imposing civil 
penalties for provision of false or fraudulent information to an 
Exchange or improper use or disclosure of information.
    \10\ See https://hfpp.cms.gov/ for more information.
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II. Solicitation of Comments

    We are seeking information from the public about circumstances in 
which steering into individual market plans may be taking place and the 
extent of such practices. We are particularly interested in 
transparency around the current practices providers may be using to 
enroll consumers in coverage. Our goal is to protect consumers from 
inappropriate health care provider behavior. People eligible for or 
receiving Medicare and/or Medicaid benefits should not be unduly 
influenced in their decisions about their health coverage options. We 
also seek to maintain continuity of care for these beneficiaries and 
ensure patient choice is the primary reason for any change in health 
coverage. We also want to ensure healthcare is being provided 
efficiently

[[Page 57557]]

and affordably. Accordingly, to more fully understand the types of 
situations in which steering may occur as we develop regulatory or 
operational changes to address these problems, we request comments on 
the following:
     In what types of circumstances are healthcare providers or 
provider-affiliated organizations in a position to steer people to 
individual market plans? How, and to what extent, are health care 
providers actively engaged in such steering?
     What impact is there to the single risk pool and to rates 
when people enter the single risk pool who might not otherwise have 
been in the pool because they would normally be covered under another 
government program? Are issuers accounting for this uncertainty when 
they are setting rates?
     Are there examples of steering practices that specifically 
target people eligible for or receiving Medicare and/or Medicaid 
benefits to enroll in individual market plans? In what ways are people 
eligible for or receiving Medicare and/or Medicaid benefits 
particularly vulnerable to steering? To what extent, if any, are 
providers steering people eligible for or receiving Medicare and/or 
Medicaid to individual market plans because they are prohibited from 
billing the Medicare and Medicaid programs, through exclusion by the 
HHS Office of Inspector General, termination from State Medicaid plans 
or the revocation of Medicare billing privileges?
     Is the payment of premiums and cost-sharing commonly used 
to steer individuals to individual market plans, or are other methods 
leading to Medicare and Medicaid eligible individuals being enrolled in 
individual market plans? Specifically, how often are issuers receiving 
payments directly from health care providers and/or provider affiliated 
organizations? Are issuers capable of determining when third party 
payments are made directly to a beneficiary and then transferred to the 
issuer? What actions could CMS consider to add transparency to third 
party payments?
     How are enrollees impacted by the practice of a health 
care provider or provider-affiliated organizations enrolling an 
individual into an individual market plan and paying premiums for that 
individual market plan, when the individual was previously or 
concurrently receiving Medicare and/or Medicaid benefits? We are 
concerned about instances where individuals eligible for Medicare and/
or Medicaid benefits may have been disadvantaged by unscrupulous 
practices aimed at increasing provider payments, including impacts to 
the enrollee's continuity of care. We would be interested in knowing 
more about these practices and the extent to which they may be more 
widespread or varied than we have identified.
     How are enrollees impacted by the practice of a health 
care provider enrolling an individual into an individual market plan 
and paying premiums for individual market plans, when the individual 
was eligible for Medicare and/or Medicaid, but not enrolled? We are 
particularly interested in information about how to measure negative 
impacts on beneficiaries and enrollees, and what data sources and 
measurement methodologies are available to assess the impact of this 
behavior described in this request for information on beneficiaries and 
enrollees. We are seeking information on any financial impacts that are 
in addition to Medicare late enrollment penalties. For example, 
differentials in copayments and deductibles paid by enrollees in 
individual market plans, Medicare or Medicaid, and the impact of 
individual market plan network limitations on the financial obligations 
of enrollees, such as increased copayments and deductibles where the 
enrollee's chosen provider is out-of-network to the individual market 
plan.
     What remedies could effectively deter health care 
providers or provider-affiliated organizations from steering people 
eligible for or enrolled in Medicare and/or Medicaid to individual 
market plans and paying premiums for the provider's financial gain? CMS 
is considering modifying regulations regarding civil monetary penalties 
and authority related to individual market plans.
     What steps do third party payers take to effectively 
screen for Medicare and/or Medicaid eligibility before offering premium 
assistance? What steps do these entities take to make sure that any 
such individuals understand the impact of signing up for an individual 
market plan if they are already eligible for or receiving Medicare and/
or Medicaid benefits?
     For providers that offer premium assistance, who is 
interacting with beneficiaries to determine proper enrollment? What 
questions are asked of the consumer to determine eligibility pathways? 
How are consumers connected to foundations or others who are in the 
position to provide premium assistance? How are premiums paid by 
providers or foundations for consumers?
     We seek comment on policies prohibiting providers from 
making offers of premium assistance and routine cost-sharing waivers 
for individual market plans when a beneficiary is currently enrolled or 
could become enrolled in Medicare Part A and other adjustments to 
federal policy on premium assistance programs in the individual market 
to prevent negative impact to beneficiaries and the single risk pool.
     We seek comments on changes to Medicare and Medicaid 
provider enrollment requirements and conditions of participation that 
would potentially restrict the ability of health care providers to 
manipulate patient enrollment in various health plans for their own 
benefit. We are also interested in information on the extent steering 
is associated with other inappropriate behavior, such as billing for 
services not provided, or quality of care concerns. We seek comment on 
the advisability of such restrictions, as well as considerations of how 
such restrictions would affect health care providers and beneficiaries.
     We seek comment on policies to require Medicare and 
Medicaid-enrolled providers to report premium assistance and cost-
sharing waivers for individual market enrollees to CMS or issuers.
     We seek comments on whether individual market plans 
considered limiting their payment to health care providers to Medicare-
based amounts for particular services and items of care and on 
potential approaches that would allow individual market plans to limit 
their payment to health care providers to Medicare-based amounts for 
particular services and items of care.
     We seek comment on policies that would allow individual 
market plans to make retroactive payment adjustments to providers, when 
health care providers are found to have steered Medicare or Medicaid 
beneficiaries and enrollees to enroll in an individual market plan for 
the provider's financial gain.

III. Collection of Information Requirements

    This request for information constitutes a general solicitation of 
public comments as stated in the implementing regulations of the 
Paperwork Reduction Act at 5 CFR 1320.3(h)(4). Therefore, this request 
for information does not impose information collection requirements, 
that is, reporting, recordkeeping or third-party disclosure 
requirements. Consequently, there is no need for review by the Office 
of Management and Budget under the authority of the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.).


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    Dated: August 16, 2016.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 2016-20034 Filed 8-18-16; 4:15 pm]
 BILLING CODE 4120-01-P