CMS Notice of Release of Intermediate Sanctions (Suspension of Marketing and Enrollment) for Medicare Advantage-Prescription Drug and Prescription Drug Plan contract numbers: H2020, H2334, H3071, H5454, H6379, H6672, H8293, H9403, H9589, and S6946
Update: September 22, 2020 The Centers for Medicare & Medicaid Services (CMS) has release the Intermediate Sanctions (Suspension of Marketing and Enrollment) for Medicare Advantage-Prescription Drug and Prescription Drug Plan contract numbers: H2020, H2334, H3071, H5454, H6379, H6672, H8293, H9403, H9589, and S6946 administered by Delaware Life Insurance Company (DLIC).
The CMS notice of release states,
"Based on the results of the validat ion audit, CMS has determined that DLIC’s deficiencies have been sufficiently corrected. Therefore, effective September 22, 2020, CMS is lifting the intermediate sanctions for contracts H2020, H2334, H3071, H5454, H6379, H6672, H8293, H9403 H9589, and S6946 and DLIC will return to normal marketing and enrollment status."
Original Article February 2, 2020
CMS imposes Intermediate Sanctions (Suspension of Enrollment and Marketing) on Medicare Advantage-Prescription Drug and Prescription Drug Plan contract numbers: H2020, H2334, H3071, H5454, H6379, H6672, H8293, H9403, H9589, and S6946
On January 31, 2020, the Centers for Medicare and Medicaid Services (CMS) gave notice to Delaware Life Insurance Company (DLIC) that CMS has made a determination to impose immediate intermediate sanctions on the following Medicare Advantage- Prescription Drug (MA-PD) and Prescription Drug Plan (PDP) Contract Numbers: H2020, H2334, H3071, H5454, H6379, H6672, H8293, H9403, H9589, and S6946.
CMS noted that "[s]ince January 1, 2020, DLIC has experienced widespread system failures with its enrollment operations, which have resulted in a disruption to its beneficiaries’ access to prescription medications. CMS has determined that these operational deficiencies have resulted in the substantial failure to comply with DLIC’s MA-PD and PDP contracts and warrant the imposition of intermediate sanctions."
The sanctions will consist of the suspension of enrollment of Medicare
beneficiaries into DLIC’s contract and the suspension of all marketing
activities to Medicare beneficiaries. These intermediate sanctions went
into effect on January 31, 2020.
From the CMS notification letter:
"On January 3, 2020, DLIC informed CMS that it had identified several issues with its MA-PD and PDP contracts which included:
(1) failing to process enrollment transactions on time,
(2) failing to send member identification (ID) cards and other enrollment documents to enrollees, and
(3) call center wait times exceeding CMS standard time-frames.
At the same time, CMS began to see an influx of complaints through its
complaints tracking module (CTM) from enrollees who were complaining
that DLIC had no record of their enrollment transactions and they were
in need of medications.
Based on these issues, CMS immediately became concerned and contacted DLIC for more information.
Prior to 2020, DLIC operated seven MA-PD contracts to administer Part C
and D benefits to approximately 5,300 beneficiaries. For contract year
2020, DLIC decided to offer a new stand-alone prescription drug benefit
(i.e. Part D) and added two MA-PD contracts. This new PDP contract
provided favorable premium and benefit options for enrollees, which made
it eligible to receive low-income subsidy (LIS) enrollees.
At the same time, DLIC’s enrollment processing vendor moved the
organization onto a new enrollment platform and understaffed its
enrollment department based on understated membership projections.
However, by January 1, 2020, DLIC’s enrollment increased by over 1,000%
and, at the same time, enrollment processing issues began to arise.
To date, CMS has received over 160 complaints in its CTM from DLIC
beneficiaries. CMS analysis of these CTMs show numerous complaints where
beneficiaries are being told that they are not enrolled in DLIC even
though they have confirmation numbers showing that they should be
enrolled in the plan. In some cases, beneficiaries are being informed by
the pharmacy that they are not enrolled in the plan while trying to
pick up their medications.
In other cases, beneficiaries are complaining that they have not
received ID cards and have had to pay out of pocket for medications. In
addition, DLIC disclosed over 400 grievances have not been addressed.
DLIC has not fully analyzed and provided details about the nature of
these grievances to CMS. In addition, when beneficiaries call into DLIC
to try to resolve the enrollment or other issues, they are being placed
on hold for significant periods of time.1
DLIC has offered several reasons for why there were breakdowns in
processing thousands of enrollments. However, DLIC has yet to provide
CMS with comprehensive explanations for why some of these errors
occurred and whether the issues have been resolved.
These errors have caused DLIC’s pharmacy network to have inaccurate
membership status information for enrollees. As a result, DLIC is seeing
rejected claims at the point of service that are related to eligibility
and enrollment issues. In addition, there were a number of data errors
that caused ID cards and welcome kits not to be mailed to beneficiaries
timely. As of January 20, 2020 there were still hundreds of ID cards and
welcome kits that were not mailed.
2
Of greatest concern is that CMS is not confident that DLIC has fully
reconciled its enrollment with its vendors to determine which members
should be enrolled in DLIC and/or whether the member is enrolled in the
correct plan. DLIC has admitted that it is not fully aware of all of the
root causes that contributed to the enrollment system failures.
Therefore, CMS concludes that DLIC has not yet fully diagnosed the
extent of its current failures or all of the enrollees that require
remediation, which is critical to the development and execution of an
effective corrective action plan.
In addition to the above enrollment issues, DLIC also admitted that its
Pharmacy Benefit Manager uploaded a file containing errors with its
pharmacy network which were visible to its enrollees and prospective
enrollees on Medicare Plan Finder during the Annual Election Period. As a
result, beneficiaries enrolled into DLIC with the expectation that
their pharmacy was in the network. These beneficiaries are now
attempting to fill prescriptions at their pharmacies and are being
turned away because their pharmacy is not in the DLIC network."
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1Hold times appear to be decreasing, however, DLIC stated it
anticipates that it will not meet CMS call center requirements until
February.
2DLIC has not provided clear details on the number of ID cards and welcome kits that remain outstanding.
Read the CMS notice:
"Notice of Imposition of Immediate Intermediate Sanctions (Suspension of
Enrollment and Marketing) for Medicare Advantage-Prescription Drug and
Prescription Drug Plan contract numbers: H2020, H2334, H3071, H5454
, H6379, H6672, H8293, H9403, H9589, and S6946"
https://www.cms.gov/files/ document/dlicsanction01312020.pdf
Related FAQs about Sanctioned Medicare plans: