Medicare preps for natural disasters, power outages

Federal health officials will require Medicare Advantage (MA) and Part D plans to develop emergency procedures so that benefits are not disrupted during natural disasters, power outages and other unpredictable circumstances.

The Centers for Medicare and Medicaid Services (CMS) finalized its proposal Friday, requiring that MA organizations and Part D sponsors plan to restore their essential operations within 72 hours of an emergency. A previous proposal included a shorter timetable of 24 hours.


Regulators said the initiative was prompted in part by Hurricane Sandy.

"It became apparent [after the storm] that a few entities, particularly those with operational centers and/or information technology sources physically located in the affected areas, did not have consistent continuity plans or back-up systems and processes to ensure ongoing coordinated deployment of critical staff to alternate locations," the regulation stated.

"A variety of events ranging from power outages to disasters and warnings of disasters can disrupt normal business operations, and when these events occur it is important that MA organizations and Part D sponsors have a plan to ensure beneficiary access to healthcare services and drugs."

The regulation noted that the vast majority of organizations and sponsors already have business continuity plans in place.

The CMS also clarified that groups must only "plan to" have essential functions running within 72 hours of a failure, and do not have to guarantee "complete restoration" within that period.

The policy was part of a 217-page final rule making changes to Medicare Advantage and Part D for the 2016 contract year. The rule was first proposed on Jan. 10, 2014.

As expected, regulators did not finalize a variety of proposals included in the first draft, including language that would lift the protected class designation on antidepressants, antipsychotics and immunosuppressants.