UPDATE:  On March 25, 2015, the sanctions imposed on SummaCare Medicare Advantage plans were lifted by the Centers for Medicare and Medicaid Services (CMS) and SummaCare can once again market and enroll Medicare beneficiaries into their Medicare Advantage plans (H3660).  Read more in our Article: CMS lifts SummaCare Medicare Part D Marketing and Enrollment sanctions.

On August 11, 2014, the Centers for Medicare and Medicaid Services (CMS) imposed immediate Intermediate Sanctions on SummaCare, Inc.  (SummaCare) Medicare Advantage-Prescription Drug Plans under contract number H3660.

CMS states that SummaCare failed to provide its enrollees with services and benefits in accordance with CMS requirements. CMS auditors concluded that SummaCare substantially failed to comply with CMS requirements regarding Part C and Part D appeals and grievances and organization/coverage determinations.

CMS identified multiple, serious violations of Part C and Part D organization/coverage determination, appeal, and grievance requirements that resulted in SummaCare’s enrollees experiencing inappropriate denials or delays of medications and medical services within enrollees’ coverage/organization determinations or appeals. Additionally, enrollees experienced inappropriate out of pocket cost for covered Medicare services and medications. These failures pose a serious threat to the health and safety of enrollees. Many of these issues stem from ineffective monitoring and oversight of SummaCare’s Pharmacy Benefit Manager (PBM), which is responsible for SummaCare’s coverage determinations. Additionally, SummaCare’s lack of internal controls and of consistent procedures resulted in a breakdown in other processes with Part D redeterminations, Part C organization determinations, and Part C reconsiderations and grievances.


DEPARTMENT OF HEALTH & HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, Maryland 21244-1850

MEDICARE PARTS C AND D OVERSIGHT AND ENFORCEMENT GROUP

August 11, 2014

Mr. Martin P. Hauser
Chief Executive Officer
SummaCare, Inc.
10 N. Main Street
Akron, OH 44308

Re: Notice of Immediate Imposition of Intermediate Sanctions (Suspension of Enrollment and Marketing) for Medicare Advantage-Prescription Drug Contract Number: H3660

Dear Mr. Hauser,

Pursuant to 42 C.F.R. § 422.756 and § 423.756, the Centers for Medicare & Medicaid Services (CMS) is providing notice to SummaCare, Inc. (SummaCare) that CMS has made a determination to immediately impose intermediate sanctions on the following Medicare Advantage-Prescription Drug Contract Number: H3660.

These intermediate sanctions will consist of the suspension of enrollment of Medicare beneficiaries into SummaCare’s plan (42 C.F.R. § 422.750(a)(1) and § 423.750(a)(1)) and the suspension of all marketing activities to Medicare beneficiaries (42 C.F.R. § 422.750(a)(3) and § 423.750(a)(3)). CMS is imposing these intermediate sanctions immediately, effective August 11, 2014, at 11:59 p.m. EST, pursuant to 42 C.F.R. § 422.756(c)(2) and § 423.756(c)(2), because it has determined that SummaCare’s conduct poses a serious threat to the health and safety of Medicare beneficiaries. Pursuant to 42 C.F.R. § 422.756(c)(3) and § 423.756(c)(3), the intermediate marketing and enrollment sanctions will remain in effect until CMS is satisfied that the deficiencies upon which the determination was based have been corrected and are not likely to recur. CMS will provide SummaCare with detailed instructions regarding the marketing and enrollment suspensions in a separate communication.

CMS has determined that SummaCare failed to provide its enrollees with services and benefits in accordance with CMS requirements. A Medicare Advantage organization and Prescription Drug Plan sponsor’s central mission is to provide Medicare enrollees with medical services and prescription drug benefits with in a framework of Medicare requirements that provide enrollees with a number of protections.

Summary of Noncompliance

CMS conducted an audit of SummaCare’s Medicare operations from June 2, 2014 through June 13, 2014. During the audit, CMS conducted reviews of numerous operational areas to determine if SummaCare is following CMS rules, regulations, and guidelines. CMS auditors concluded that SummaCare substantially failed to comply with CMS requirements regarding Part C and Part D appeals and grievances and organization/coverage determinations in violation of 42 C.F.R. Part 422, Subpart M and 42 C.F.R. 423, Subpart M. CMS found that SummaCare’s failures in these areas were widespread and systemic. Violations result ed in enrollees experiencing delays or denials and increased out of pocket costs for medical services and prescription drugs.

Part C and Part D Organization/Coverage Determination, Appeal, and Grievance Relevant Requirements

(42 C.F.R. Part 422, Subpart M; 42 C.F.R. Part 423, Subpart M; IOM Pub. 100-18 Medicare Prescription Drug Benefit Manual, Chapter 18; IOM Pub. 100-16 Medicare Managed Care Manual, Chapter 13)

Medicare enrollees have the right to contact their plan sponsor to express general dissatisfaction with the operations, activities, or behavior of the plan sponsor or to make a specific complaint about the denial of coverage for drugs or services to which the enrollee believes he or she is entitled. Sponsors are required to classify general complaints about services, benefits, or the sponsor’s operations or activities as grievances. Sponsors are required to classify complaints about coverage for drugs or services as organization determinations (Part C – medical services) or coverage determinations (Part D – drug benefits). It is critical for a sponsor to properly classify each complaint as a grievance or an organization/coverage determination or both. Improper classification of an organization or coverage determination denies an enrollee the applicable due process and appeal rights and may delay an enrollee’s access to medically necessary or life-sustaining services or drugs.

The enrollee, the enrollee’s representative, or the enrollee’s treating physician or prescriber may make a request for an organization determination or coverage determination. The first level of review is the organization determination or coverage determination, which is conducted by the plan sponsor, and the point at which beneficiaries or their physicians submit justification for the service or benefit. Coverage decisions must be made in accordance with Medicare coverage guidelines, Medicare covered benefits, and each sponsor’s CMS-approved coverage policies and prescription drug benefits. If the organization or coverage determination is adverse (not in favor of the beneficiary), the beneficiary has the right to file an appeal. The first level of the appeal – called a reconsideration (Part C) or redetermination (Part D) – is handled by the plan sponsor and must be conducted by a physician who was not involved in the organization determination or coverage determination decision. The second level of appeal is made to an independent review entity (IRE) contracted by CMS.

There are different decision making timeframes for the review of organization determinations, coverage determinations, and appeals. CMS has a beneficiary protection process in place that requires plans to forward organization determinations, coverage determinations, and appeals to the IRE when the plan has missed the applicable adjudication timeframe.

Violations Related to Part C and Part D Organization/Coverage Determinations, Appeals, and Grievances

CMS identified multiple, serious violations of Part C and Part D organization/coverage determination, appeal, and grievance requirements that resulted in SummaCare’s enrollees experiencing inappropriate denials or delays of medications and medical services within enrollees’ coverage/organization determinations or appeals. Additionally, enrollees experienced inappropriate out of pocket cost for covered Medicare services and medications. These failures pose a serious threat to the health and safety of enrollees. Many of these issues stem from ineffective monitoring and oversight of SummaCare’s Pharmacy Benefit Manager (PBM), which is responsible for SummaCare’s coverage determinations. Additionally, SummaCare’s lack of internal controls and of consistent procedures resulted in a breakdown in other processes with Part D redeterminations, Part C organization determinations, and Part C reconsiderations and grievances. SummaCare’s violations include:

Click here to read the remainder of the notice from CMS.