As we welcome the new year, the Centers for Medicare & Medicaid Services (CMS) has released crucial updates regarding the January 2025 payment cycle for Medicare Advantage and Prescription Drug Plans. Here’s everything you need to know about the latest developments and actions required.
1. Reopening of the 2019 Final Part D Payment Reconciliation
CMS has finalized the reopening of the 2019 Final Part D Payment Reconciliation, and the results are reflected in the January 2025 payments. You can find these adjustments under the Plan Payment Report (PPR), categorized as a special adjustment type labeled “PRS.”
This update ensures that calculations from the 2019 reconciliation align with current standards, offering greater accuracy and fairness in reimbursements.
2. MARx Data Cleanup: Payments Out of Sync with Enrollments
A major data cleanup was conducted to resolve instances where payments were out of sync with enrollments. During late 2023 and early 2024, some beneficiaries who switched plans caused payments to incorrectly flow to their previous plan for the first month of enrollment in the new plan.
Key Details:
Adjustments for these discrepancies are included in the January 2025 Monthly Membership Report (MMR).
They are marked with Adjustment Reason Code (ARC) 94 and Cleanup ID CS1975228.
These corrections aim to restore alignment between enrollment data and payment distributions.
3. Premium Withhold and Reduction Fixes
CMS identified an issue with the MARx system where updates to the Premium Payment Option (PPO) for Part C/D premiums and Part B premium reductions were not properly sent to the Social Security Administration (SSA). This resulted in incorrect premium amounts being withheld from beneficiaries in 2024 and January 2025.
What to Expect:
CMS is actively addressing this issue, and corrected updates will reflect in beneficiaries’ SSA benefits by February or March 2025.
Most beneficiaries affected by this will receive a refund, which CMS anticipates will be credited to their SSA benefits.
4. National Medicare Education Campaign (NMEC) User Fees for 2025
In accordance with the Social Security Act (Section 1857(e)(2)), CMS will begin collecting National Medicare Education Campaign (NMEC) user fees in the January payment cycle. These fees are designed to cover costs associated with enrollment-related activities.
MA-PD Plans: Fee rate set at 0.023%, with a total collection of $111.1 million.
PDPs: Fee rate set at 0.024%, with a total collection of $9.7 million.
These fees ensure that CMS continues to provide education and resources for beneficiaries and organizations alike.
5. MARx Migration to Amazon Web Services (AWS)
In July 2023, the MARx system transitioned to a cloud-based infrastructure on Amazon Web Services (AWS). This migration enhanced the system’s ability to process enrollment, premium, and payment data efficiently.
However, CMS has acknowledged discrepancies in the calculation of Part C and Part D risk scores during this transition. To address this:
Ongoing software fixes and data cleanups are being prioritized.
Plans impacted by these issues are being tracked through master tickets to assess the scale and expedite resolutions.
Questions regarding the MARx system can be directed to mapdhelp@cms.hhs.gov.
6. Sequestration Suspension Adjustments
While the suspension of sequestration has officially ended, CMS continues to apply sequestration rules for retroactive payment adjustments:
Payments from May 2020 to March 2022 are not subject to sequestration.
Adjustments for April to June 2022 include a 1% sequestration.
Payments from July 2022 onward include a 2% sequestration.
These rules ensure consistency and compliance with statutory requirements.
By staying informed about these updates, Medicare Advantage and Prescription Drug Plan organizations can better align their operations with CMS standards, ensuring smoother processes and improved beneficiary outcomes in 2025.