Review of Health Net of California's Modifications to Its 2004 Adjusted Community Rate Proposal Under the Medicare Prescription Drug, Improvement, and Modernization Act

EXECUTIVE SUMMARY:

Our objective was to determine whether Health Net's use of its Medicare Prescription Drug, Improvement, and Modernization Act (MMA) payment increase was allowable and adequately supported under the MMA. Health Net's use of its MMA payment increase of $5.6 million (or $42.88 per-member per-month) was allowable and adequately supported under the MMA.  Specifically, Health Net used the increased MMA payments to reduce beneficiary cost sharing, enhance benefits, and stabilize beneficiary access to providers.  Therefore, we are not making any recommendations to Health Net.