Error in August 7, 2018 CMS memo on Medicare Advantage Plans Step Therapy

https://www.cms.gov/Medicare/Health-Plans/HealthPlansGenInfo/Downloads/MA_Step_Therapy_HPMS_Memo_8_7_2018.pdf


Memo version as reviewed August 15, 2018.


I have the impression there is an error on page 3 of the August 7 memo on Step Therapy.  (PDF)

MEMO
As clipped below, in the four page memo, CMS states that consistent with 422.134, rewards like gift cards must comply to be "reasonable."  CMS will presume the award is "reasonable" if it is MORE THAN HALF the amount saved on average per participant (p. 3).

REG
However, 422.134 states that,
 [must]  Have a monetary cap as determined by CMS of a value that may be expected to impact enrollee behavior BUT NOT EXCEED the value of the health related service or activity itself;


ANALYSIS
It appears that CMS on page 3 should state, the value should be LESS THAN HALF.
 A value LESS THAN HALF will not exceed the amount of the service.  A value that is any number MORE THAN HALF the service can be any amount much higher than the value of the service.   For example, if the average value saved is $200, a gift card of $90 would fail under the memo (not more than half), but a value of $1000 would pass (more than half).

##
August 8 MEMO
"...Consistent with 42 CFR §422.134, plan rewards cannot be
offered in the form of cash or monetary rebate, but may be offered as gift cards or other items of
value to all eligible enrollees.  MA plans should make sure any rewards or incentives comply
with all rules at 42 CFR § 422.134 and Chapter 4 of the Medicare Managed Care Manual.  Under
these rules, the value of the rewards or incentives must be reasonable and appropriate. In this
particular context, CMS will presume that the reward or incentive is reasonable and appropriate 
if it is equivalent to more than half the amount saved on average per participant by a more
efficient use of health care resources, promotion of improved health, or prevention of injuries
and illness."

##
REG 42 CFR 422.134
https://www.law.cornell.edu/cfr/text/42/422.134
A rewards and incentives program must -

(i) Be offered in connection with the entire service or activity;

(ii) Be offered to all eligible members without discrimination;

(iii) Have a monetary cap as determined by CMS of a value that may be expected to impact enrollee behavior but not exceed the value of the health related service or activity itself;

MANUAL
Managed Care Manual, Ch 4, Section 100, quotes the above regulation ("must not exceed the value").
https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/mc86c04.pdf

The term "half" (whether more or less than half) appears in the August 8 memo, but doesn't seem to be in either the Reg or Chapter.