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Earlier this year, the Centers for Medicare and Medicaid Services (CMS) upended data reporting for payers who provide supplemental benefits such as vision and dental supplements to government-provided Medicare.
CMS released guidance and details in February that required Medicare Supplemental Benefits payers to submit each “encounter” (a healthcare service provided, such as a doctor visit) and made the requirements retroactive to January 1, 2024. This guidance can cause several challenges for payers since some supplemental benefits may not be provided by regular healthcare providers and these services don’t have the Health Insurance Portability and Accountability Act of 1996 (HIPAA) standard code sets. Such services include non-emergency transportation, in-home safety assessments, fitness benefits and groceries, among others.
As part of our commitment to assisting clients in meeting requirements for government health plans, PwC has developed an AI-assisted solution that defines criteria needed to report supplemental benefit encounters, including five main areas where payers should focus. Medicare Advantage Plans offering Supplemental Benefits can take these five steps to maintain compliance with government mandates on health services data.
1. Prioritize additional Medicare-covered benefits
Because many services are covered by Medicare, payers are already submitting encounters for the Medicare-covered benefit. Adjustments to identify the additional services as supplemental benefits are minimal. By prioritizing these encounters, many payers can begin meeting some of the requirements and can show CMS a good-faith effort to include encounters back to January.
2. Collaborate with supplemental benefit providers
CMS hopes to receive supplemental benefits data down to a granular level, going so far as to ask payers to allocate each consumer health service purchase on a pre-funded card to allocating a specific category for combined services. The supplemental benefit service categories align with the plan benefit package (PBP) categories, which will help make it simpler to identify these encounters by mapping benefits to the PBP. But it may require additional information, data feeds and code sets for those providers who may not be familiar with healthcare data sets. Early communication and an iterative approach with these providers can allow for both sides to help determine what new mechanisms need to be put in place and create time for adequate testing.
3. Create code set traceability
Harking back to the era before HIPAA standard code sets, CMS has defined new default codes that will be used for supplemental benefit services and providers that do not qualify for a national provider identifier (NPI). Several required data elements will need default codes, including NPIs, diagnosis codes (if no relevant diagnosis code is available), revenue codes (if no relevant revenue code is available) and procedure codes (if no relevant procedure code is available). Additionally, there are mandatory values for the PWK (paperwork providing links between claims and additional documentation) noting that the service is a supplemental benefit. These default codes may not give specific data to CMS on what service was provided, and those payers will need to have a system of controls and traceability to be able to tie each encounter back to that supplemental service and what was provided.
4. Set a non-claim-based encounters strategy
Two types of encounters will need to be created for non-claim-based services. And payers will need a strategy and process around encounters for both capitated or periodic-based payments (e.g., gym memberships) and per-service or unit-based payments (e.g., pre-funded card payments). There is added complexity: If a payment covers multiple supplemental benefit categories, spending must be separated out by category and an encounter record submitted for each category.
For periodic payments, it may be as simple as creating mass encounters based on an eligibility file sent to the provider each month. For service- or unit-based encounters, payers will need to develop detailed requirements to accurately help identify and separate encounters across supplemental benefit categories.
5. Determine strategy for dental claim electronic submissions (837D)
If payers cover dental services as supplemental benefits, they are already getting the 837D from their providers and all the information needed. CMS is allowing two different options for dental encounters: (1) continue submitting the information on an 837P and cut over to the 837D when CMS is ready to accept them (anticipated in June 2024) or (2) hold dental encounters until CMS is ready to accept the 837D, then submit everything back to January. With the other requirements taking up employees’ time and focus, determine the strategy that makes sense based on priorities.
Executing these new CMS encounter requirements will be a sprint: Everything needs to be done, with data submitted, retroactive to January 1. Although the requirements should not affect risk adjustment filtering logic, if there is a relevant diagnosis code on the supplemental benefit encounter, it will be counted. It also gives CMS visibility into the utilization of supplemental benefits and how they can affect and impact the overall health and outcomes of Medicare members.
Contact us for additional guidance on navigating the complexity of CMS reporting and for information on our AI-assisted platform to help payers comply with new reporting requirements.
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