1999 Medicare + Choice Cover Letter

October 30, 1998

Dear Presidents/CEOs of Section 1876 Medicare Risk Contractors:

            Your organization has notified the Health Care Financing Administration (HCFA), through the submission of supplemental materials in September, of its decision to transition from the Section 1876 Medicare contracting program to the Medicare+Choice (M+C) program. Based on this notification, your plan will be offered to Medicare beneficiaries during the November open enrollment period.

            Enclosed are three copies of the M+C coordinated care plan contract for your signature. Under the Balanced Budget Act of 1997, all Section 1876 contracts will expire on December 31, 1998. Since open enrollment for the new M+C plans is scheduled for November, it is important that HCFA receive written commitments of participation from M+C organizations by you as soon as possible, but no later than November 13, 1998. In planning for the implementation of the M+C program and in communicating with Medicare beneficiaries, HCFA has relied on the receipt of supplemental materials from current Section 1876 risk-based contractors as evidence of their intention to participate in this new program. If we do not receive a signed contract from your organization by November 13, HCFA will have an obligation to notify beneficiaries that your plan will not be available in January 1999 so they will have an adequate opportunity to review their options under the M+C program and make a timely coverage election.

            As with many other aspects of the M+C program implementation, the development of the M+C contract has been a complex and time-consuming task, requiring the coordination of comments from several diverse parties, each with an interest in the success of the program. HCFA consulted among its own staff as well as with other Federal agencies to develop a first draft of the contract, released to the public less than three weeks ago. Since that time, HCFA has received many constructive comments from health care industry representatives, many of which we have included in the attached contract.

            The contract has been revised from the draft released on October 9 in several significant ways.

            1) Transition Contract: Because the contract is based on an interim final M+C regulation, we have limited the term of this contract to the first, or transition, year of the new program. HCFA will develop a new contract for subsequent years based on the final M+C regulation that will be issued next year.

            2) Certification Standards: The information certification requirements in Article IV have been revised to make the standard of attestation consistent with the certification forms (Attachments A and B ). Thus, certification will be made based on “best knowledge, information, and belief." Also, we have clarified the types of information M+C organizations will be required to certify. Certifications are now limited to enrollment information, inpatient encounter data, and information contained in the adjusted community rate (ACR) proposal.

            3) Compliance Plan and Provider Contracting: In accord with earlier statements by the Administrator, the M+C contract now includes language requiring M+C organizations to work toward the implementation of a Medicare compliance program and the execution of new provider contracts during the transition, with full compliance in these two areas expected by January 1, 2000.

            4) Quality Assessment: To reflect information provided at earlier HCFA briefings on the Quality Improvement System for Managed Care (QISMC), the contract no longer contains the requirement that M+C organizations achieve minimum performance levels during 1999. Moreover, the quality assessment provisions at Article III, Section E have been largely redrafted to provide more clarity on the requirements of this part of the M+C program.

            For the M+C Program, HCFA is making some changes to the way in which contracts are numbered. You will note on the cover page of the contract there is a space for a contract number (P number). This will be a new contract number for your organization and HCFA will complete this section upon receipt of your signed contract. Please enter the name of your state-licensed organization in the designated space on the cover page. On page one of the contract there are spaces for current contract numbers, i.e., H numbers. Please insert your current contract number in one of these spaces. If you have multiple contracts in a state, you will find that HCFA has entered all the H numbers for your organization. After signing all three copies of the contract, please return to:

Cheryl Bitoun
CHPP/HPPA
C4-23-07
Health Care Financing Administration
7500 Security Blvd.
Baltimore, MD 21244

Countersigned contracts will be returned to you after final approval of the supplemental materials submission. The listing of your organization’s service area(s) will be returned with the countersigned contract. If you have questions about the contract or the process for returning the contract, please contact your HCFA Central Office Plan Manager.

            The M+C program represents dramatic changes for HCFA, the health care industry, and most importantly, Medicare beneficiaries. We are depending greatly on the M+C organizations to help us make the implementation of the M+C program as seamless as possible for Medicare beneficiaries. Thank you for your cooperation in signing the enclosed contract, and we look forward to working with you over the next year in meeting the health care needs of Medicare beneficiaries under the M+C program.

Sincerely,

Robert A. Berenson, M.D.
Director

Source: HCFA web site www.hcfa.gov

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