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No Surprises Act Dispute Process Favors Providers

The No Surprises Act (NDA) remains  a huge mess with volume 13 times higher than forecast for 2023.  What’s more, providers won 77% of arbitration cases and health insurers won in 23% of cases. The winning offers were above the qualifying payment amount, which is the median in-network rate.

The good news is that 10 million surprise bills were avoided with the law in the first nine months of 2023.  The bad news is that providers are winning huge in the baseball-style arbitration as they do in other states that have it.  Studies show that rates and premiums rose in those states under the provider-friendly process.  Researchers say that will happen nationwide now.  Yet, providers continue to sue to get things even more slanted toward them.  Congress has to even the playing field.  But they won’t as lawmakers from both sides of the aisle are provider-friendly due to campaign contributions and hospital board seats.

Evidence too that a small number of firms are driving cases. And the three largest are all private equity or venture backed.

Additional article here: https://www.fiercehealthcare.com/regulatory/surprise-billing-disputes-continue-far-outpace-federal-estimates-cms

#privetequityfirms #providers #nsa #nosurprisesact #surprisebilling

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Cigna To Start Stock Buyback

Cigna said it would repurchase $3.2 billion in stock as part of a repurchase of $5 billion of common stock over the first half of 2024. This will help enhance its stock price.  Cigna will get $3.7 billion for its Medicare Advantage sale to Health Care Service Corporation (HCSC) when it closes.

#cigna #hcsc

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Elevance Health Takeover Of BCBSLA On Hold Again

Facing pushback from Louisiana regulators, the governor and some lawmakers, BCBSLA has again withdrawn its application for sales to Elevance Health. BCBSLA sought permission to transition to a for-profit entity.

Additional article: https://www.modernhealthcare.com/mergers-acquisitions/elevance-health-blue-cross-louisiana-merger-called-off

(Some articles may require a subscription.)

#bcbsla #elevancehealth

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Showing Strain In MA, PE Deals Dropped Significantly

Private equity firms’ investment in the Medicare Advantage (MA) space are way down from a peak in 2021. This is a sign that rising medical expense and regulation is impacting the industry. Just 4 deals occurred in 2023, down from 19 in 2021.

Additional article here: https://www.modernhealthcare.com/finance/private-equity-medicare-advantage-pesp-report

(Some articles may require a subscription.)

#medicareadvantage #privatequityfirms

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Kaiser Turns Around Performance

Kaiser Permanente moved from a $1 billion loss in 2022 to about breakeven at least in terms of operating income in 2023.  Its income was $4.1 billion with investments.  It reached the $100 billion mark in both operating revenues and expenses.

#kaiserpermanente #managedcare

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Senate To Tackle Medicare Physician Formula

A bipartisan group of senators will tackle long-term reform of the Medicare physician pay formula. On 1/1, a 3.4% reduction went into effect due to the existing formula.  Some have accused physicians of spending more time lobbying on health plan prior authorization reform than on their own rate issues.

#medicare #physicians

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Weighty Lesson For Employers From NC State Employee Plan Experience On GLP-1 Drugs

A lesson for employer groups as weight-loss drugs take off in popularity.  An analysis of data says that just 25 of over 6,200 prescribers in the North Carolina State Employee Plan accounted for 8 percent of the costs of prescriptions for costly weight loss drugs. These include GLP-1 meds Wegovy and Saxenda. These drugs accounted for 10% of total costs – or over $100 million.

The state wanted to rein in costs with some ideas, but its pharmacy benefit manger shot them down.

Shame on the healthcare players to not work with employers battling these cost issues.

As important, there are telehealth entities now emerging, backed by private equity, advertising solely to prescribe such meds.  It is corrupt.

#weightlossdrugs #drugpricing

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House Republicans Vote To Ban QALYs

House Republicans passed a bill to ban the use of the controversial Quality Adjusted Life Years (QALY) measurement in federal programs. 

Additional article here: https://www.fiercehealthcare.com/payers/house-republicans-vote-ban-pricing-metrics-federal-programs

#qalys #medicare #medicaid

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Centene Reports Good Numbers, But Cautions On MA Rates

Centene reported good numbers to Wall Street today, with notable increases in its Exchange line of business. Medicaid enrollment dropped due to redeterminations.

But like Humana, Centene is cautioning that the Medicare Advantage (MA) 2025 rate announcement was inadequate and could lead to further benefit and other changes in its MA line. It also notes that other regulatory changes are impacting its MA investment.  Centene has already pared back benefits and geographies to bring its MA line to a better financial position.

Additional articles here: https://www.modernhealthcare.com/insurance/centene-medicare-advantage-rate-cut-2025-sarah-london and https://www.healthcaredive.com/news/centene-medicare-advantage-rate-drop-2023-earnings/706620/

Two other articles on the fallout from MA rates and regulatory changes here: https://www.modernhealthcare.com/insurance/medicare-advantage-rate-cut-2025-reimbursements-benefits-unitedhealth-humana and https://www.statnews.com/2024/02/05/cano-health-bankruptcy-medicare-advantage/

These articles underscore what I said in these blogs: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/ and https://www.healthcarelabyrinth.com/2025-rates-for-medicare-advantage-plans-look-tight/

(Some articles may require a subscription.)

#centene #medicareadvantage

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Spectacular But Not Unexpected Fall Of Cano Health

Showing that healthcare remains a risky place, Cano Health announces bankruptcy and a spectacular collapse for the provider organization that enters into risk arrangements with Medicare Advantage (MA) and Medicaid managed care. The MA market has been tough for both plans and providers. The new CEO has been trying to refocus efforts in better market areas by exiting questionable areas. Questions are being raised about why Humana, a major stakeholder, will not buy the firm outright. 

Additional articles here: https://www.modernhealthcare.com/digital-health/cano-health-bankruptcy-mark-kent and https://www.healthcaredive.com/news/cano-health-chapter-11-bankruptcy-restructuring-agreement/706546/

(Some articles may require a subscription.)

#medicareadvantage #humana #providers

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