CMS issues notice of sanctions to Medicare Advantage insurer

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The Centers for Medicare & Medicaid Services this week informed Medicare Advantage insurer Quality Health Plans of its intent to impose intermediate sanctions and a civil monetary penalty (CMP) on the company due to its failure to comply with certain requirements. QHP is the third insurer in as many months to come under fire from CMS for non-compliance.

Shortfalls in QHP policies include “deficiencies in billing procedures and practices, denying and/or delaying Part D medications to beneficiaries, developing and implementing an adequate compliance plan for both its operations and pharmacy benefit manager, and non-compliance in beneficiary appeals and grievance procedures,” according to CMS. CMS has alleged that QHP neglected to bill beneficiaries for a monthly premium since January 2008, instead charging enrollees one lump sum, in some cases up to $1,000. This presents a particular problem for QHP enrollees, since many of the company's customers are “financially disadvantaged” and beneficiaries of a low-income subsidy, according to CMS.

The first notice from CMS would suspend marketing and enrollment of new members in QHP's Medicare Advantage plans. The second would impose a $586,800 CMP against the company “based on the adverse impact or substantial likelihood of adverse impact that QHP's premium billing violations had on their enrollees.”

In other prescription drug news, a recent AARP analysis found that prices for brand-name prescription drugs commonly prescribed to seniors on Medicare jumped by 9.7% last year. Generic drug prices, meanwhile, dropped by the same percentage. This is the biggest one-year increase for brand-name drug prices since 2002, according to AARP.