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MedPAC Repeats Dubious Overpayment Number In Report

MedPAC, the congressional policy arm for Medicare, again has published a dubious overpayment number in a report to Congress. It says the federal government will spend $84 billion more in 2025 on Medicare Advantage (MA) enrollees than if they were enrolled in the traditional fee-for-service (FFS) program. This is about 20% more. This is slightly lower than MedPAC reported in 2024. 

MedPAC says two factors accounting for the majority of overpayments to MA plans are risk score coding intensity and favorable selection. It says risk scores for MA enrollees will be around 16% higher in MA vs. FFS, which accounts for $40 billion. It says that $44 billion is favorable selection.

Many MA proponents and I do not buy the favorable selection number or all of the risk score coding number. But I have admitted that some plans take advantage of risk adjustment and do overcode. They get a disproportionate amount of the overpayments. MedPAC notes a wide variation among plans as well. I agree with MedPAC that heath risk assessments (HRAs) and manual chart reviews account for a good deal of the increased scoring and should be removed or reformed.

Given all of this continuing negative publicity, I do think MA reductions and overpayments could appear in the budget reconciliation bill or pass later this year. See this blog on areas they could cut: https://www.healthcarelabyrinth.com/medicare-advantage-in-the-gunsight/

#medicareadvantage #healthplans #overpayments #riskadjustment

https://www.beckerspayer.com/payer/medpac-estimates-84b-in-medicare-advantage-overpayments-in-2025-10-notes.html

Government Shutdown Could Occur

Senate Democrats came out today and said they do not plan to vote for the House GOP-passed continuing resolution (CR) to fund the rest of this federal fiscal year (through September), instead demanding a 30-day CR to allow for additional negotiations. But there is some buzz that many Democratic senators could change their minds if the Senate GOP majority calls for a cloture vote later this week. The GOP is very unlikely to opt for a 30-day option.

One GOP senator, Rand Paul of Kentucky, is against any CR. That means eight Democrats would be needed to invoke cloture to end debate and pass the bill. Several senators have commented they are worried about the political fallout if they vote no. Others feel a government shutdown further empowers Elon Musk and his cost-cutting commission and efforts. A CR must be passed by Friday or there would be a government shutdown.

Additional article: https://thehill.com/homenews/senate/5189724-senate-democrats-government-funding-shutdown/?tbref=hp

#governmentshutdown #cr #congress #trump

https://thehill.com/homenews/senate/5191508-senate-democrats-vote-government-funding-30-day-cr

House Passes the FFY 2025 CR

The House passed the FFY 2025 continuing resolution (CR) today by a vote of 217 to 213. One Republican voted no and one Democrat voted yes. The bill’s passage came together when House Speaker Mike Johnson, R-LA, and Senate Majority Leader Jon Thune, R-SD, committed that a Medicare physician rate fix would be in the budget reconciliation bill slated for May. The commitment was made to Rep. Greg Murphy, M.D., R-N.C., co-chair of the House Doctors Caucus. He and others threatened to vote no, which might have sunk the bill. Murphy says how far-reaching the fix is – overturning this year’s reduction, adding to it for this year, or a permanent fix – is unspecified at this time.

The bill next goes to the Senate. Democrats want to vote en masse against the bill, which would deprive the CR of 60 votes and sink it. But they also are weary of the political fallout of voting against the bill. The Senate Democrats would clearly be blamed for any shutdown now. The most worried are Democrats from seven swing states. They also argue a government shutdown could make the Department of Government Efficiency (DOGE) commission initiatives even more far-reaching.

We will see what happens before Friday.

Additional article: https://www.fiercehealthcare.com/regulatory/speaker-johnson-releases-funding-patch-six-month-telehealth-extension-no-doc-pay-fix and https://insidehealthpolicy.com/daily-news/murphy-gets-promise-doc-fix-will-go-reconciliation and https://thehill.com/homenews/senate/5186882-government-funding-shutdown-senate-democrats/

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#budgetreconciliation #governmentshutdown #cr #healthcare #trump #congress #physicians #medicare

https://thehill.com/homenews/house/5189141-house-republicans-pass-government-funding-bill

House CR Unveiled With No Doc Fix

House Speaker Mike Johnson, R-LA, unveiled the FFY 2025 continuing resolution (CR) through the end of the fiscal year in September. If the bill passes the House, it goes to the Senate. At least one House GOP member has announced opposition, but the lack of a Medicare physician rate fix could mean others drop off. Passage in the Senate is unknown because 60 votes are needed and Democrats appear to be lining up against it. But moderate Democrats could have a change of heart. The bill also extends some critical healthcare programs that would expire on March 31. The House may vote on the bill Tuesday.

In other news, a bipartisan proposal to further extend telehealth, reform pharmacy benefits managers (PBMs), reverse Medicare physician pay cuts, and address the opioid crisis has failed to be called up in the Senate.

Additional articles: https://insidehealthpolicy.com/daily-news/providers-furious-house-continuing-resolution-omits-doc-pay-fix and https://www.modernhealthcare.com/politics-policy/spending-bill-medicare-doctor-pay and https://thehill.com/homenews/house/5184753-scott-perry-medicaid-coverage/ and https://www.fiercehealthcare.com/telehealth/senate-dems-push-long-shot-bill-pbm-reform-telehealth-extensions-and-35-doc-pay-fix

(Some articles may require a subscription.)

#governmentshutdown #trump #congress #ffy2025 #medicare #physicians #cr

https://www.fiercehealthcare.com/regulatory/speaker-johnson-releases-funding-patch-six-month-telehealth-extension-no-doc-pay-fix

Trump May Support Changes To Medicare Drug Negotiations

Big Pharma says that President Donald Trump and Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. are sympathetic to the drug lobby’s concerns regarding the Inflation Reduction Act’s (IRA) “pill penalty” provision within the Medicare drug price negotiations.

Drug makers say the law discourages research into small molecule drugs. Small-molecule drugs are exempt from Medicare drug price setting for nine years after FDA approval, while biologics are exempt for 13 years. Big Pharma has been lobbying to extend the small-molecule drug exclusivity period to 13 years.

Some congressional bills would extend the period before price negotiation can begin for small molecule drugs to match biologics.

(Article may require a subscription.)

#ira #drugpricing #branddrugmakers

https://insidehealthpolicy.com/daily-news/pfizer-ceo-trump-kennedy-sympathetic-pill-penalty-concerns

Paragon Says Improper Medicaid Payments Could Be Over $1 Trillion

The Paragon Health Institute is an extremely powerful think tank with the ear of the Trump administration and some in Congress. Its newest report, in conjunction with the Economic Policy Innovation Center, says that improper payments under Medicaid could be as much as $1.1 trillion over ten years. The Centers for Medicare and Medicaid Services (CMS) estimated improper payments at $543 billion over ten years, but Paragon says that does not include eligibility check errors.

The report urges Congress to cut funding to states found with greater than 3% erroneous payments based on eligibility errors. Many of the errors are tied to the suspension of eligibility checks during the COVID pandemic. The ineligible population includes people over income limits and illegal immigrants.

The report gives hope that the GOP Congress can reduce Medicaid spending and perhaps certain Medicare spending without fundamentally impacting coverage. This is a promise made by the president and congressional leaders in the House.

(Article may require a subscription.)

#medicaid #fwa #improperpayments

https://insidehealthpolicy.com/daily-news/paragon-epic-eligibility-errors-medicaid-improper-payments-top-11-trillion