Medicare Advantage Prescription Drug Monitoring

Problem

The Centers for Medicare & Medicaid Services wants to ensure its provider networks adequately serve their beneficiaries.

The Centers for Medicare & Medicaid Services (CMS) makes partially capitated payments to private insurers, also known as Part D sponsors, for delivering prescription drug benefits to Medicare beneficiaries. To receive these payments, Part D sponsors must meet access standards set by CMS.

These access standards set a percentage of Medicare beneficiaries that need to be within a given distance bandwidth of the pharmacies within a Part D network. The standards vary by urbanicity, and whether a Part D sponsor’s pharmacy network contains preferred cost share pharmacies.

CMS set these access standards to help ensure the availability of prescription drugs to seniors, but they needed to know whether the standards were being met.

Solution

NORC conducts a quarterly geo-analysis of Medicare Part D provider networks.

To ensure Part D sponsors meet the access standards set by CMS, NORC provides a number of analytical files to CMS based on a multi-step GIS-based assessment of each sponsor’s provider network.

Each sponsor’s provider network is assigned coordinates using NORC’s state-of-the-art geocoding software. Sponsor service areas are then linked to population density data to categorize them by urbanicity. Finally, the percent of beneficiaries within each sponsor’s service area that are within CMS’s access standards is calculated, along with a several additional statistics, such as the average distance to a pharmacy.

This analysis is conducted quarterly to monitor compliance and identify outliers throughout the year. Additionally, a NORC undertakes a more detailed yearly analysis, in which we pinpoint areas of the U.S. that are underserved by any Part D sponsor and determine the most commonly spoken languages within each plan’s service area.

Result

NORC identifies Part D sponsors that are not serving the beneficiaries they’re paid to cover.

NORC provides CMS with a quarterly series of analytical files that identify which Part D sponsors are not compliant with CMS’s access standards. These files contain ZIP code-level coverage estimates, so non-compliant sponsors are able to tell where in their service area beneficiaries are under-covered. These files use multiple methods to measure urbanicity, so CMS can avoid any category errors resulting from misclassified geographies.

NORC also reports overall trends in sponsor network and service area size, beneficiary access and preferred cost sharing availability, so CMS can stay attuned to fluctuations in coverage. All these reporting metrics help CMS guarantee Part D sponsors make prescription drugs available to the beneficiaries they’re contracted to serve.