CMS Pub. 100-16, ch. mc86c16a, § 30.3.3

An existing PFFS plan may, in a subsequent contract year, have some counties (or partial

counties) in its current service area that meet the definition of a network area and other

counties (or partial counties) that do not. In order to preserve benefit uniformity under an

MA plan, CMS will not permit an MA organization offering a PFFS plan to operate a

mixed model where some counties (or partial counties) in the plan’s service area are

considered network areas and other counties (or partial counties) that are non-network

areas (where there are no network-based plan options or only one other network-based

plan). In other words, a PFFS plan must be either a network based plan, a non-network

plan, or a partial network plan.

PFFS Plans Operating in Both Network and Non-Network Areas. Current MA

organizations offering PFFS plans with service areas spanning both network and non-network areas must complete the initial application process in order to bring the network

portions of their service area into compliance with the access to services requirement.

These organizations will be issued a new contract (H) number through the application

process to encompass the network portions of the service area. If the application is

approved, the organization will be authorized to move the affected members to the new

contract number. The current contract will continue to operate in the non-network areas.

PFFS Plans Operating in Network Areas. Current MA organizations offering PFFS plans

whose service area lies solely in network areas must complete the initial application

process in order to qualify to offer their PFFS plan to current and new members as a

network PFFS plan. These organizations may NOT purport to meet the access to services

requirement by moving their enrollees into aHealth Maintenance Organization (HMO) or

Preferred Provider Organization (PPO) as it is not permissible to move affected members

from the PFFS plan into other types of MA plans. The organizations that fail to complete

the initial application process will be non-renewed or have their service area reduced and

the affected members will be disenrolled to Original Medicare.

PFFS plans operating in network areas must meet the access to services requirement for

all categories of Part A and Part B health care providers by establishing signed contracts

or agreements with a sufficient number and range of providers to meet the access

standards described in section 1852(d)(1) of the Act and section 30.2 of this chapter.

Consequently, these plans must operate as full network PFFS plans. These PFFS plans

may not use alternate methods to meet the access to services requirement in network

areas. Specifically, these plans may not operate as non-network or partial network PFFS

plans. If an MA organization is not able to establish a network of direct-contracting

providers that CMS determines to be adequate in a network area, then it may not offer a

PFFS plan in that area.

Current MA organizations offering PFFS plans that need to file an initial application to

enable them to transition some or all of their plans to full network plans must first file a

Notice of Intent to Apply (NOIA). CMS will not accept NOIAs and applications for non-network PFFS plans for those counties (or partial counties) determined to be network

areas for a given plan year.

PFFS Plans Operating in Non-Network Areas. PFFS plans whose service areas lie solely

in non-network areas can continue to operate as non-network plans, where the plan meets

the access to services requirement by establishing payment rates that are not less than the

rates that apply under Original Medicare (refer to section 70.2 of this chapter) and having

providers deemed to be contracted under the plan as provided under 42 CFR 422.216(f)

and described in section 40.2 of this chapter. PFFS plans in non-network areas may also

choose to operate as full network plans (refer to section 70.3 of this chapter) or partial

network plans (refer to section 70.4 of this chapter). No new application is required.

A network based PFFS plan must meet the access to services requirement by establishing

signed contracts or agreements with a sufficient number and range of providers to furnish

Part A and B services. However, providers who do not have a signed contract or

agreement with the plan may continue to furnish out-of-network Part A and Part B

services to those members of the plan who seek care with them by agreeing to accept the

PFFS plan’s terms and conditions of payment and becoming a deemed providers as

described in 42 CFR 422.216(f) and section 40.2 of this chapter. However, the plan may

establish higher cost sharing requirements for members who obtain covered services from

deemed providers instead of plan’s network providers. Please note that all providers are

still subject to balance billing limitations.