CMS Limits Medicare Advantage Plan Cost Sharing for Home Health Services

WASHINGTON, D.C (April 19, 2022)—The Centers for Medicare & Medicaid Services (CMS) has issued a final rule with comment period that finalizes two remaining proposals from the original proposed rule that laid out policy and technical changes to the Medicare Advantage program, Medicare Part D, Medicaid and more. That proposed rule was originally issued in February 2020. 

One provision that CMS finalized in this rule is a policy change related to service category cost sharing limits for Medicare Parts A and B services. Cost sharing occurs when patients pay for a portion of health care costs not covered by their insurance.

Under this provision, CMS has adopted a requirement that cost sharing under Medicare Advantage (MA) cannot exceed cost sharing limits included in original Medicare for home health services for plans with a mandatory maximum out of pocket (MOOP) amount. The highest allowable MA plan cost sharing limit for home health is 20% or an equivalent copayment, which is limited to MA plans with a lower MOOP amount. MA plans that establish a mandatory or intermediate MOOP amount must establish $0 cost sharing for home health services. The provision is effective Jan. 1, 2023.

CMS believes imposing limits on cost sharing for covered services is an important way to ensure that the cost sharing aspect of an MA plan design does not discriminate against or discourage enrollment of beneficiaries who have high health care needs and who need specific services.

The National Association for Home Care & Hospice in a press release expressed gratitude that CMS has finally adopted this policy. The association reported that home health agencies have had patients refuse needed home health services due to high co-pays that the beneficiary would not have been subject to under fee-for-service Medicare.

Read the final rule here.