S&P Sings The Blues Of Hospitals – But Here Is the Other Side Of The Story
Financial firm and rater S & P Global is bemoaning the potential impact of Medicare Advantage (MA) on hospitals. It says in a new report that extended utilization increases could force MA plans to further rein in payments to providers. It also notes that the further expansion of MA hurts hospitals and providers too due to prior authorization (PA) and claims payment delays and practices. Thus, provider margins will be under pressure. And while the provider lobbies got a huge win when the Centers for Medicare and Medicaid Services (CMS) directed MA plans to follow traditional inpatient admission rules, S & P says MA plans could seek to recoup the costs with further restrictions.
I do not take issue with S &P’s assessment per se, but there was another report recently that I found very interesting. A Third Way report suggests that more than half of hospitals make money on Medicare and one-third make money on Medicaid. Thus, it is a myth that hospitals cannot make money on government programs at current rates. It is more an issue of hospital bloat and not using revenue effectively. Hospitals need to reform. The bloat allows hospitals to demand obscene rates from the commercial sector – supposedly to make ends meet.
Hospitals have lived off of the excess and unaccountability of the traditional Medicare program, with no prior authorization or utilization controls. I will go into great detail on this in a blog next week.
And while S & P sings the blues of the hospitals, Modern Healthcare had a good article today about all the pressures faced by MA, some caused by the industry and others by outside forces. They include:
- The new PA restrictions from CMS.
- The new risk adjustment formula phase-in from CMS.
- The rise of utilization post COVID.
- Contentious payer-provider relationships, where hospitals could term MA plans.
- Major pharmacy trends.
- The cyberattack fallout.
Third Way Report: https://www.thirdway.org/report/tale-of-two-hospitals-why-some-hospitals-succeed-and-others-do-not
Additional article: https://www.modernhealthcare.com/insurance/medicare-advantage-costs-rising-factors
(Some articles may require a subscription.)
#medicareadvantage #hospitals #medicare #medicaid
FTC Non-Compete Struck Down
A Texas federal judge struck down the Federal Trade Commission’s (FTC) ban on noncompete agreements in employment contracts, saying the ban violates the Administrative Procedure Act (APA) and exceeds the agency’s statutory authority. The ruling applies nationwide and was made just 15 days before the ban was set to take effect. The move was meant to stop hospitals and large physician groups from unfairly restricting the ability of medical professionals to move to other entities. The case is headed to the appellate level due to conflicting rulings. Success is likely remote due to the recent Chevron deference reversal by the Supreme Court. It will be hard to find explicit authority for the FTC to mandate a ban.
Additional articles: https://www.fiercehealthcare.com/regulatory/federal-judge-blocks-ftcs-nationwide-noncompete-ban and https://www.modernhealthcare.com/legal/ftc-noncompete-ban-blocked-texas
(Some articles may require a subscription.)
#ftc #noncompetes #healthcare #hospitals #providers
https://www.healthcaredive.com/news/ftc-noncompete-ban-blocked-nationwide-texas-healthcare/724819
Trump Backs Lifetime Revolving Door Ban On FDA
Donald Trump has proposed a lifetime ban on lobbying by former federal employees. This is too far-reaching in my view, but it is noble in terms of trying to clean up the corrupt influence of the revolving door between the Food and Drug Administration (FDA), and other federal health agencies, and the drug industry. His VP candidate has a bill for an eight-year ban. The Democratic platform speaks to limiting the influence of lobbyists.
(Article may require a subscription.)
#lobbying #healthcare
Democratic Platform On Healthcare Reform
The Democratic platform has a number of positions on healthcare reform, including:
- A major expansion of the Medicare drug price negotiation provisions.
- Supporting march-in rights on drug patents.
- Insulin and out-of-pocket cost caps on commercial coverage.
- Dental, vision, and hearing in traditional Medicare.
- Ground ambulance caps under the No Surprises Act.
- An antitrust agenda.
- Medical debt retirement.
- Medicaid expansion proposals.
Additional article: https://insidehealthpolicy.com/daily-news/dnc-platform-add-dental-vision-hearing-medicare-invest-women-s-health
(Articles may require a subscription.)
#election2024 #harris #healthcare
Elevance Health Subsidiary Hit with HHS OIG Audit On Overpayments
MMM of Puerto Rico, an Elevance Health-owned Medicare Advantage (MA) plan received $59 million in overpayments in 2017, according to a Health and Human Services Office of Inspector (HHS OIG) audit. MMM disagreed with the methodology and conclusions of the OIG. The OIG only recommended a small recovery due to the new risk adjustment data validation (RADV) rule limiting extrapolation penalties to Contract Years 2028 and later. The broader Centers for Medicare and Medicaid Services (CMS) RADV rule is being challenged in court on a number of grounds, its retroactive nature, its inconsistency with administrative procedures, and the lack of an FFS adjuster, which the agency argued in favor of previously.
Similar audits have been done on other plans with similar findings. It shows the potential revenue risk to MA plans in the future.
#radv #riskadjustment #overpayments #medicareadvantage
— Marc S. Ryan
