The Centers for Medicare & Medicaid Services (CMS) 2025 Medicare Final Rule introduced several updates that will affect Medicare plans, agents, and enrollees.
Alongside changes to agent compensation for Medicare Advantage (MA), new and revised regulations will significantly reshape the Dual Eligible Special Needs Plan (D-SNP) landscape.
As you assist clients, especially dual eligible, be sure to keep these new CMS rules in mind when helping them find the right coverage.
What Are the D-SNP Changes in CMS 2025 Final Rule?
Navigating the complexities of Medicaid and Medicare integration can be challenging for both agents and clients, especially when dealing with Dual Eligible Special Needs Plans (D-SNPs). However, CMS is rolling out changes aimed at simplifying this process and improving outcomes for dually eligible individuals.
With the 2025 updates, CMS seeks to better integrate Medicaid and Medicare services for dual-eligible beneficiaries, enhancing care coordination, accessibility, and affordability.
The ideal scenario for both CMS and dual-eligible enrollees is for beneficiaries to receive Medicare and Medicaid benefits from the same plan or organization—known as fully integrated D-SNPs—or from two plans under the same parent organization, referred to as highly integrated D-SNPs. This “exclusively aligned enrollment” not only simplifies administration but also reduces costs and leads to better health outcomes for enrollees.
Below is a timeline for the implementation of the D-SNP changes under the 2025 Final Rule.
Upcoming AEP Changes
| 2025 | 2026 | 2027 | 2028 | 2029 | 2030 |
| New monthly
D-SNP integrated-care SEP |
Limits on D-SNP PPO out-of-network cost-sharing | D-SNP enrollment limited to individuals in affiliated MMCO | D-SNP with affiliated MMCO’s must have disenrolled all beneficiaries not in the MMCO | ||
| No more quarterly
D-SNP SEP |
MAO’s can only offer one D-SNP in a service area with an affiliated MMCO | ||||
| MAO’s not allowed to offer extra similar contracts | |||||
| Medicare Lowers D-SNP Similar Threshold | |||||
| 70% | 60% | Possibly lower in future | |||
A Closer Look at the D-SNP Changes in the 2025 Medicare Final Rule
Enrollment Restrictions for D-SNPs with Affiliated Medicaid Plans
Starting in 2027, CMS will implement new rules limiting enrollment into certain D-SNPs to individuals who are either already enrolled in, or in the process of enrolling in, an affiliated Medicaid Managed Care Organization (MMCO).
For example, if Sally, a dual-eligible beneficiary, wants to enroll in ABC Health’s D-SNP, she must also be enrolled in, or actively enrolling in, ABC Health’s affiliated MMCO. Sally would not be eligible to enroll in ABC Health’s D-SNP if she is enrolled in XYZ Health’s Medicaid plan.
Some D-SNP carriers, particularly smaller or regional ones, may not have an affiliated MMCO. CMS will not impose these enrollment limits at the federal level for such plan sponsors, though individual states may choose to enforce enrollment restrictions through their State Medicaid Agency Contracts (SMACs).
To further ensure coordinated care and benefits, CMS will require, by 2030, that D-SNPs with an affiliated MMCO disenroll any dually eligible beneficiaries who are not also enrolled in the affiliated MMCO.
Returning to our example: If Sally is already enrolled in ABC Health’s D-SNP but gets her Medicaid coverage from XYZ Health, she will need to switch to ABC Health’s MMCO by 2030. If she doesn’t, she will be disenrolled from ABC Health’s D-SNP.
New Integrated D-SNP Monthly SEP Replacing the Quarterly LIS SEP
CMS acknowledges that the new D-SNP enrollment restrictions might deter some carriers from participating in Medicaid managed care programs, especially if they don’t offer affiliated MMCOs, which would make them exempt from the restrictions. To encourage more participation in MMCOs, CMS is modifying how Special Enrollment Periods (SEPs) work for dual-eligible individuals.
Starting January 1, 2025, CMS will split the current quarterly Part D SEP for dually eligible and other low-income subsidy (LIS) enrollees into two separate SEPs:
- A revised monthly SEP for enrollment in stand-alone prescription drug plans (PDPs).
- A new monthly integrated-care SEP allowing dual-eligible individuals to enroll in an integrated D-SNP plan, provided they also receive Medicaid services through an affiliated managed care plan.
Dually eligible individuals will no longer be able to enroll in any D-SNP of their choice on a monthly or quarterly basis. Instead, they will only be able to enroll in a Medicaid managed care plan that allows simultaneous enrollment in the affiliated D-SNP. This change gives those not already in integrated or affiliated plans more opportunities to do so. However, individuals in states without integrated plans will no longer have access to the quarterly SEP and won’t be able to use the new monthly SEP.
For example, if Sally is not currently enrolled in ABC Health’s D-SNP and its affiliated MMCO, she will now have the opportunity to enroll in both each month, rather than having to wait for AEP or another SEP.
It’s important to note that states vary in their offerings of D-SNP plans, their level of coordination with Medicaid, and how frequently Medicaid switches are allowed. As a result, some dual-eligible clients may not be able to utilize the new monthly integrated-care SEP and may have to wait until AEP to make changes.
Be sure to consult with the D-SNP carriers you represent and review your state’s regulations to determine if your clients can use the new monthly integrated-care SEP or will need to wait for AEP.
Here’s a table to help clarify the changes in SEPs.:
|
Examples for Dual-Eligible Individuals
|
Existing Rules Under the Quarterly Dual/LIS SEP
|
New Monthly Dual/LIS SEP, Integrated-Care SEP, and Enrollment Restrictions for Non-Integrated Plans |
| Select any Medicare Advantage (MA) plan during the Initial Coverage Election Period (ICEP) or Annual Election Period (AEP), or switch between plans during the MA Open Enrollment Period (MA OEP) | Allowed | Allowed, except full-benefit dual-eligible individuals in Medicaid MCOs would not be able to choose a non-aligned D-SNP where applicable. |
| Choose Medicare Fee-for-Service (FFS) and a standalone Prescription Drug Plan (PDP) mid-year | One change allowed per quarter, except during the final quarter | Allowed monthly for all LIS-eligible and dual-eligible individuals |
| Select an integrated D-SNP (FIDE SNP, HIDE SNP, or AIP), if eligible, during the mid-year period |
Allowed monthly for full-benefit dual-eligible individuals and limited to facilitating aligned enrollment
|
|
| Choose a non-integrated D-SNP or another Medicare Advantage (MA) plan during the mid-year period. | Not allowed |
Additional Information on How the New D-SNP SEP Will Function
The new monthly integrated D-SNP SEP isn’t limited to newly eligible individuals or those seeking exclusively aligned enrollment for the first time. Dual-eligible beneficiaries already enrolled in an integrated plan can also use this SEP to make a lateral move to another integrated plan, whether it’s offered by the same carrier or a different one.
If a beneficiary wants to switch to an integrated plan from a different carrier, they must first change their Medicaid plan, in accordance with state guidelines, before enrolling in the new carrier’s integrated D-SNP, thereby achieving aligned enrollment.
It’s essential to pay close attention to which company provides the coordinated Medicaid plan when the member requests a switch. Enrollment into a D-SNP during the integrated-care SEP depends on coordination between Medicaid and the D-SNP. Avoid enrolling a client into an uncoordinated Medicaid plan. Just because a Medicaid plan and D-SNP are offered by the same company doesn’t guarantee they are coordinated. Always verify the type of D-SNP and its level of integration with the carrier before making a switch for your client.
D-SNP Limits in Affiliated Medicaid MCO Service Areas
Beginning in 2027, CMS will restrict the number of D-SNPs that a Medicare Advantage Organization (MAO) or its parent company can offer within the same service area as its affiliated Medicaid Managed Care Organization (MMCO) to just one. For example, ABC Health will only be allowed to offer a single D-SNP in the service area covered by its affiliated MMCO.
However, if a state Medicaid agency mandates more than one D-SNP option for dual-eligible individuals in the same service area, state law will override CMS’ limitation, allowing multiple D-SNP options.
D-SNP Look-Alike Threshold Lowered for 2025 and Beyond
According to KFF, nearly 30 percent of dual-eligible individuals are enrolled in a D-SNP, while the remaining 70 percent are often in “look-alike” Medicare Advantage (MA) plans. These look-alike plans typically market to dual eligible but do not offer the coordinated care and wrap-around services that true D-SNPs provide, nor do they comply with federal and state D-SNP contracting requirements.
CMS aims to increase the number of dual-eligible beneficiaries enrolled in integrated D-SNPs and gradually phase out look-alike plans. As part of this effort, CMS will lower the threshold for look-alike MA plans.
Currently, a look-alike plan is defined as having no more than 80 percent of its members as dual eligible. However, CMS will lower this threshold to 70 percent for plan year 2025 and further to 60 percent for plan year 2026, with the possibility of reducing it even more in future years.
In addition, starting January 1, 2025, CMS will prohibit Medicare Advantage Organizations (MAOs) from offering new look-alike plan contracts. Carriers will have the option to transition look-alike plan members to either a true D-SNP or a regular $0 premium MA plan. Expect your dual-eligible clients currently enrolled in look-alike plans to receive notices this fall regarding their upcoming plan transition.
D-SNP PPO Out-of-Network Cost-Sharing Limit
Beginning in 2026, CMS will impose limits on the amount that PPO D-SNPs can charge dual-eligible enrollees for out-of-network services, specifically related to certain Part A and B benefits. This change will shift more of the cost burden to the Medicare Advantage carrier, reducing the reliance on Medicaid for covering out-of-network expenses. More detailed guidance from CMS is expected as we approach 2026.
What Does the 2025 CMS Final Rule Mean for Dual Eligibles?
The 2025 CMS Final Rule introduces changes aimed at simplifying the process for dually eligible individuals. Here’s a summary of the key updates:
More Enrollment Opportunities for Integrated Plans
The new integrated-care Special Enrollment Period (SEP) will allow dual-eligible individuals to enroll in fully or highly integrated D-SNPs every month. While they can also make lateral moves between integrated plans, this SEP is expected to primarily support first-time, exclusively aligned enrollment.
Fewer Enrollment Options for Non-Integrated Plans
Starting in 2025, dual-eligible individuals will no longer have the option to enroll in non-integrated D-SNPs on a quarterly basis, as they did in the past.
Limited Enrollment Opportunities in Select States
In states without integrated plans or where Medicaid switches are not allowed monthly, dual-eligible clients will face fewer chances to enroll in D-SNPs. Even where integrated plans are available, some states only allow Medicaid changes once per year or during a specific timeframe, making the new monthly SEP irrelevant. The SEP requires a Medicaid switch for aligned enrollment.
Fewer D-SNP Options per Parent Organization
CMS will restrict each parent organization to offering just one D-SNP in any given Medicaid Managed Care Organization (MCO) service area. Although this may seem limiting, CMS aims to simplify plan selection by reducing choice overload for dual-eligible individuals, making it easier to navigate the options.
Fewer Look-Alike D-SNPs
The reduced threshold for look-alike MA plans will push carriers to transition dual-eligible enrollees from look-alike plans to either a true D-SNP or a $0-premium MA plan. Beneficiaries can expect to receive notices from their carriers this fall with details on the upcoming plan changes.
Enhanced Protection, Access, Affordability, and Care Coordination
CMS’ changes aim to improve various aspects of the D-SNP landscape, including:
- Protection from misleading look-alike marketing and excessive plan choices
- Monthly access to integrated plan enrollment
- More predictable costs through reduced cost-sharing
- Better care coordination through fully or highly integrated plans
These updates are intended to significantly enhance the experience and health outcomes of dual-eligible beneficiaries.
What Do These CMS Rule Changes Mean for Agents?
These updates present both opportunities and challenges for agents. Here’s how they might affect you:
Understand Your State’s Regulations
With the new monthly SEP and other changes, it’s crucial to familiarize yourself with your state’s Medicaid and D-SNP rules. If you’re licensed in multiple states, staying informed about each state’s specific requirements becomes even more essential.
Greater Emphasis on Thorough Fact-Finding
Because these changes primarily impact dual-eligible individuals, it’s more important than ever to conduct a detailed and thorough fact-finding process. Understanding your client’s eligibility and Medicaid level will help you determine the appropriate enrollment timeline and guide them into the right plan.
Be mindful and respectful when gathering this information, as discussing financial matters can be sensitive. Build trust with your clients by asking about non-financial topics first, helping them feel comfortable before delving into questions about their Medicaid status.
Limited Enrollment Opportunities for Non-Integrated D-SNPs
Ensure your portfolio includes fully or highly integrated D-SNPs from carriers that have an affiliated Medicaid Managed Care Organization (MMCO) to provide your clients with the best possible options.
Fewer D-SNP Options to Navigate
Due to the new service area restrictions, you’ll have a clearer understanding of the available D-SNP options in your market. With each carrier offering only one plan per MCO service area, you may find it easier to contract with more carriers than before, allowing you to expand your D-SNP offerings and provide more comprehensive options for your clients
Check In with Your Dually Eligible Clients
Now is the ideal time to review your dually eligible clients’ current plans and offer recommendations, especially for those in non-integrated plans or look-alike plans. Be sure to notify clients in look-alike plans that their coverage may change in the fall due to new regulations. For clients in non-integrated plans, consider scheduling appointments to discuss integrated options and explain the upcoming changes.
Timing is Key
Checking in with your D-SNP clients during AEP has become a necessity. While in the past, agents may have waited until after AEP to touch base with D-SNP clients, that approach won’t work anymore. Now, you may need to prioritize D-SNP clients during AEP, especially for those who can’t take advantage of the new monthly integrated-care SEP due to the plans available in their area or their state’s Medicaid rules.
With many changes happening in the Medicare industry this year—like the Part D redesign updates – Essential Care is here to guide you every step of the way. As CMS works to simplify D-SNPs and improve health outcomes, now is a great time to start selling D-SNPs if you haven’t already. We anticipate a significant increase in dual-eligible individuals enrolling in integrated plans over the next few years due to these changes, and we’ll keep you informed on any further developments.
In addition to providing updates, Essential Care offers agents personalized support, cutting-edge sales technology, and valuable educational resources—all available for free when you register with Essential Care!
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