The Centers for Medicare & Medicaid Services has announced the capitation rates for Medicare Advantage plans for 2011.
The final 2011 call letter for Medicare Advantage (Part C) and Medicare prescription drug (Part D) plans accompanied the rate announcement.
According to CMS’ advance notice, if new legislation was enacted after it was released but before the rate announcement was published, changes would be incorporated. As required by Section 1102 of the Health Care and Education Reconciliation Act of 2010, the capitation rates for 2011 are the same as the capitation rates for 2010.
In previous years, CMS included final estimates of the national per capita growth percentages (MA growth percentages) as well as tables summarizing the key assumptions that were used to develop the MA growth percentages.
The final estimates of the MA growth percentages were used to trend the previous years’ capitation rates to the payment year. Given that the capitation rates for 2011 are the same as 2010, the MA growth percentages have no relevance for the 2011 capitation rates. Therefore, the rate announcement does not include final estimates of the MA growth percentages or the associated key assumptions tables.
The rate announcement contains the following key changes in response to new legislation:
- CMS will not implement the new CMS-HCC and CMS-HCC ESRD dialysis and risk adjustment models or the recalibrated frailty factors in 2011.
- CMS will maintain the 2011 state ESRD rates at the 2010 amounts.
- As required by the Patient Protection and Affordable Care Act of 2010, CMS will calculate the government Part D premium subsidy amounts for low-income beneficiaries using plans’ basic part D premiums before the premiums are reduced by Part C rebates.
The rate announcement also contains a discussion of the provisions in the health reform legislation that begin to close the Part D coverage gap in 2011 and the effect of these provisions on plans’ Part D bids.
Annual parameter updates to Medicare Part D benefits are unchanged, with the exception of a $10 increase in the initial coverage limit.
The Final Rate Announcement Letter can be found here.