2024 Medicare Advantage and Part D Final Rule

Denise Wilson, MS, RN, RRT | April 11, 2023

On April 5, 2023, CMS issued their final rule on Medicare Advantage (MA) and Part D plans. The final rule is to be officially published in the Code of Federal Regulations on April 12, 2023. The final rule clarifies and codifies areas of the MA program that have been points of contention between the MA plan and provider interpretation of the rules.

Although there are a number of issues addressed in the 724-page document, only inpatient admission, Skilled Nursing Facility (SNF) care, Home Health Services and Inpatient Rehabilitation Facilities (IRF) are discussed in this article.

The final rule reaffirms that MA organizations (MAO) cannot limit or deny coverage for services that would be covered under Traditional Medicare. CMS specifically calls out Part A inpatient admission, Skilled Nursing Facility (SNF) care, Home Health Services and Inpatient Rehabilitation Facilities (IRF) as Traditional Medicare coverage benefits which also apply to the MA program. CMS also clarified that the CMS inpatient-only list applies to MAOs.

The proposed and final rules were issued by CMS in part due to an OIG report[1] that stated CMS guidance was not detailed enough to understand whether MA organizations were prohibited from denying authorization based on clinical criteria that went beyond Medicare coverage rules. CMS has reinforced in this final rule that MA organizations cannot apply coverage criteria more restrictive that Traditional Medicare coverage.

CMS clearly states in the final rule that MAOs must follow the “two midnight benchmark” as well as the “case-by-case exception” when providing coverage for inpatient admission. However, the “two-midnight presumption” (that all patients that stay more than two midnights are presumed to be appropriate for inpatient admission, and thus generally will not undergo retrospective review) will not apply. This allows MA plans to determine which claims will be subject to review.

CMS also appeared to listen to commenters who shared experiences from MA plans who dismissed the two-midnight rule as a payment policy which they were not required to follow. In the final rule, CMS made it very clear that whether Traditional Medicare criteria are considered coverage rules or payment rules is irrelevant; the criteria still apply to MA plans.

There’s still some question about when these changes will go into effect. The final rule states an effective date of Jan. 1, 2024, however, since some of the final rule is clarification of existing rules, then some would argue that the changes should go into effect immediately. How CMS and payer might respond to that thought remains to be seen.

About the Author:

Denise serves as the Senior Vice President at Denial Research Group – AppealMasters. Denise is also President of The Association for Healthcare Denial and Appeal Management. Denise is a Registered Respiratory Therapist, Registered Nurse, and holds a master’s degree in management information systems from the University of Illinois, Springfield.

Denise has over thirty years of experience in healthcare, including clinical management, education, compliance, and appeal writing. Denise has extensive experience as a Medical Appeals Expert and has personally managed hundreds of Medicare, Managed Medicare, and Commercial appeal cases and presented hundreds of cases at the Administrative Law Judge level.

Denise is a nationally known speaker and dynamic educator on Medicare and Commercial appeals processes, payer behaviors, standards of care, appeal template development, and building a road map to drive the payer to a decision in the provider’s favor. She has educated thousands of healthcare professionals around the country in successfully overturning medical care denials.

Contact Denise at [email protected].