6.1 Special Needs Plans (SNPs) Overview

Why SNPs Matter on the AHIP Exam

Special Needs Plans (SNPs) are a form of Medicare Advantage plan, but they are legally restricted to enrollees who fit a specific "special needs individual" category defined by Congress. Because SNP enrollment is restricted by statute — not just by plan design — misenrolling a beneficiary into a SNP they don't qualify for is treated by CMS as a serious compliance failure, not a paperwork mistake. AHIP's Module 2 tests SNPs heavily because agents who sell Medicare Advantage are very likely to encounter SNP-eligible clients (roughly half of all Medicare Advantage enrollees now sit in a D-SNP, C-SNP, or I-SNP), and because the rules governing who can enroll, how the plan must manage their care, and what happens if they lose eligibility are all independently testable.

Quick Answer: A Special Needs Plan (SNP) is a Medicare Advantage coordinated care plan that restricts enrollment to one of three CMS-defined populations: dual-eligible (D-SNP), chronic-condition (C-SNP), or institutionalized (I-SNP) beneficiaries. All SNPs must include Part D drug coverage and operate under an NCQA-approved Model of Care.

The Statutory Basis and the Three SNP Types

Congress first authorized SNPs on a temporary, demonstration basis under the Medicare Modernization Act of 2003. The Bipartisan Budget Act (BBA) of 2018 made D-SNPs a permanent part of the Medicare Advantage program and added new Medicare-Medicaid integration requirements — a detail worth remembering because older prep materials sometimes still describe D-SNPs as temporary or subject to periodic reauthorization votes; that is no longer accurate.

The law identifies three categories of "special needs individuals," and each maps directly to one SNP type:

Chapter 6.2 and 6.3 cover each type's eligibility rules and verification process in depth. This section focuses on what all three share.

What Every SNP Must Have: The Model of Care

The single biggest structural difference between a SNP and a standard Medicare Advantage plan is the Model of Care (MOC) — a CMS- and NCQA-reviewed framework describing exactly how the plan will identify each enrollee's needs and manage them over time. Every SNP must submit its MOC to CMS, and NCQA scores it on clinical and non-clinical elements. Based on that score, CMS approves the MOC for a 1-, 2-, or 3-year cycle — a lower score means more frequent resubmission and review.

The MOC is not a marketing document; it drives real operational requirements that CMS expects the plan to execute for 100% of enrollees:

1. Health Risk Assessment (HRA) — a standardized initial assessment used to identify each enrollee's medical, psychosocial, cognitive, and functional needs, generally completed within 90 days of enrollment and at least annually thereafter.
2. Individualized Care Plan (ICP) — a care plan built from the HRA results, developed with enrollee (or caregiver) input.
3. Interdisciplinary Care Team (ICT) — a coordinated team of clinical and non-clinical staff (which can include the enrollee's own treating providers) that reviews and updates the ICP; ICT encounters may occur in person or via real-time interactive telehealth.

CMS's stated goal for HRA, ICP, and ICT completion is 100%, or a "5-star" internal goal — anything less is considered a shortfall, which is why SNP care-coordination staffing and outreach cadence tend to be more intensive than a standard MA plan.

Shared Rules Across All Three SNP Types

Regardless of D-SNP, C-SNP, or I-SNP status, three rules apply universally:

• Mandatory Part D. Every SNP must include Part D prescription drug coverage. There is no MA-only SNP, because the special-needs populations these plans serve almost always depend on ongoing medication management.
• Restricted enrollment. A SNP may only enroll members of its defined special-needs population. Unlike a standard MA plan open to any Medicare-eligible person in the service area, a SNP must verify — not assume — that an applicant belongs to the target population before enrollment is effective.
• Verification is ongoing, not one-time. Eligibility for a SNP can be lost (a chronic condition resolves, dual-eligible status ends, an institutional stay ends), and each SNP type has its own specific re-verification and grace-period rules, covered in the next two sections.

Exam Scenario

An agent meets with a client who has Medicare and full Medicaid benefits, and separately mentions a nephew who has diabetes and lives independently. The agent cannot enroll the nephew in a D-SNP (he isn't dual-eligible) and cannot enroll the aunt in a C-SNP for her diabetes unless she is also independently found eligible under that plan's chronic-condition criteria — SNP type must match the specific qualifying category, and a beneficiary who happens to qualify for one SNP type is not automatically eligible for another.