The Centers of Medicare and Medicaid Services has lifted enrollment and marketing sanctions against Cigna, allowing the insurer to resume marketing and enrollment for its Medicare Advantage and prescription drug plans.
On June 16, Cigna received notification from CMS that the marketing and enrollment sanctions imposed on January 21, 2016, were lifted, according to the Securities and Exchange Commission filing.
Effective immediately, Cigna may resume marketing of its Medicare Advantage-Prescription Drug and Medicare Part D Plans and may begin enrolling beneficiaries with effective dates beginning July 1.
"In addition, based on the final Medicare Star Ratings for the 2018 payment year, we expect that approximately 60 percent of our Medicare Advantage customers will be in a 4 Star or greater plan," according to the SEC filing.
CMS sent a letter to Cigna-HealthSpring Interim CEO and COO Shawn Morris on Friday, releasing the insurer from the sanctions.
Cigna attested that the violations listed in the sanction notice were corrected, which was confirmed by an independent audit, according to the letter.
Morris said by statement, "We are a better and stronger company as a result of collaborating with CMS and investing further in our processes and technology over the past year and half. As a company that puts customers first, we look forward to continuing that partnership while delivering high-quality health care plans to both existing and new customers."
CMS imposed the sanctions in January 2016 after the federal agency found deficiencies in an audit of Cigna-HealthSpring operations. The deficiencies resulted in enrollees experiencing delays or denials in receiving medical services and prescription drugs, or in an increase in their out-of-pocket costs for medical services and prescription drugs.
Cigna's acquisition of HealthSpring, Inc. in 2012, which expanded its presence in the Medicare segment, contributed to creating an organizational structure that was decentralized and fragmented, CMS said in the January 21, 2016 notice. This breakdown in operations made it difficult for Cigna to adequately monitor and oversee whether it was in compliance with the Medicare Parts C and D requirements, CMS said.
"Cigna has had a longstanding history of non-compliance with CMS requirements," the agency said in the sanctions letter.
However, in a somewhat unexpected move in March 2016, CMS lifted its star rating reductions for the MA plans. The decision protected millions in bonus money.