Part 2: A Blog Series on the Highly Anticipated CHRONIC Care Act

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Which Medicare Beneficiaries Get Non-Medical Benefits?

by Bella Kirchner, Special Projects Manager

As healthcare costs continue to rise1, health insurance companies, including The Centers for Medicare and Medicaid Services (CMS), are thinking about ways to incorporate social needs into their reimbursement models. Studies have shown that addressing these needs leads to improved health outcomes which, in turn, lowers the cost it takes to care for patients2. CMS is strongly committed to this idea; according to the Secretary of Health and Human Services, Alex M. Azar II: “Just like how every patient is different in healthcare, every person has unique social service needs—and we are intent on designing models that connect them to the services they need, rather than offering a one-size-fits-all approach.” 3

As we wrote about in Part One of this series, one of the most significant moves towards changing these reimbursement models to include social needs was the passage of The CHRONIC (Creating High-quality Results and Outcomes Necessary to Improve Chronic) Care Act, which specifically affects Medicare Advantage (MA) plans.  Previously, supplemental benefits reimbursed by CMS for chronically ill beneficiaries had to be health-related services used to “prevent, cure or diminish an illness or injury.” The CHRONIC Care Act changed that definition to cover services that provide “a reasonable expectation of improving or maintaining the health or overall function of the chronically ill enrollee and may not be limited to being primarily health related benefits.”4 This is a significant move in the industry — reimbursement for non-health (i.e., social needs)  services.

Many questions have arisen about how to put this into practice and one of the main concerns health plans have had relates to CMS uniformity requirements for Medicare Advantage plans. These requirements stipulate that beneficiaries residing in the same service area of the MA plan must be offered “a uniform premium, with uniform benefits and level of cost-sharing throughout the plan’s service area, or segment of service area.”5 This has been interpreted to mean that, per plan, whatever is offered to one beneficiary must also be offered to all beneficiaries in the service area. The one-size-fits-all nature of old uniformity requirements was a major hurdle for payers to reimburse services that were not purely medical in nature. The fear was that any beneficiary could claim a need for a social need service, potentially costing the health plan a good deal of money.

However, in April 2018, CMS released clarification around the uniformity rule for Medicare Advantage plans.6 They defined areas for flexibility with the MA uniformity requirements, writing, “We have determined that providing access to services (or specific cost sharing for services or items) that are tied to health status or disease state in a manner that ensures that similarly situated individuals are treated uniformly is consistent with the uniformity requirement in the Medicare Advantage (MA) regulations.” This is a reinterpretation of the rule in that it allows for flexibility specifically related to “health status or disease state.” Starting in 2020, rather than having to offer certain supplemental benefits to ALL members, MA plans can offer them uniformly to the members who meet the specific medical criteria defined by the MA plan.

Insurance companies must design these benefits using “medical criteria that are objective and measurable.”6 Beneficiaries will also be required to be diagnosed with the condition(s) by a plan provider. In order to ensure that the uniformity requirements are fair and do not discriminate, CMS will be reviewing all benefit design plans.

Before the CHRONIC Care Act, this flexibility would have been reserved solely for supplemental medical-related benefits (e.g., tobacco cessation classes for COPD patients, non-emergent transportation for heart failure patients). However, with the passage of the CHRONIC Care Act, those supplemental benefits now include non-medical services. To take advantage of both the new reimbursement models and the reinterpretation of uniformity rules, Medicare Advantage plans should design benefit packages that tie those non-medical benefits to “health status of disease state.” What might this look like?  

  • For asthmatics, provide an air conditioner benefit;
  • For patients with COPD of other lung diseases, provide a mold removal benefit;
  • For patients with amputation caused by diabetes, provide a home modification benefit; or
  • For patients with dementia, provide a home safety benefit.

The list could go on and on. Over time, we predict that insurance plans will start to provide more social need benefits for patients. While there are still plenty of questions that need to be answered, this is an exciting start.

Check out part three of our blog series: So What’s Going to be Reimbursed?





4Willink, A., & DuGoff, E. H. (2018). Integrating medical and nonmedical services – The promise and pitfalls of the CHRONIC care act. New England Journal of Medicine, 378(23), 2153-2155. DOI: 10.1056/NEJMp1803292


6Federal Register (Vol 83, No 73, 16480-16486)

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