February 21, 2024

New CMS DSH Rule Will Reduce Medicaid Hospital Payments

Medicaid disproportionate share hospital (DSH) payments are being cut by $8 billion annually for the nest five fiscal years based on a new rule finalized by the Centers for Medicare and Medicaid Services (CMS).  The rule is purported to rein in overpayments. A recent study suggested that a liberal formula calculation meant a third of all qualifying hospitals should not have received payments.  CMS has been pushing to reduce such payments in favor of broad coverage.

Additional articles: https://www.fiercehealthcare.com/providers/many-disproportionate-share-hospitals-face-lower-medicaid-payments-under-new-final-rule and https://www.modernhealthcare.com/policy/medicaid-dsh-cuts-safety-net-hospitals-cms-final-rule

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HCSC Believes In Medicare Advantage

As Cigna decided its investment in Medicare Advantage (MA) was too much on the health plan side, Health Care Service Corporation (HCSC) agreed with most large insurers that MA investments made sense.  It paid $3.3 billion for about 600,000 Cigna MA lives, bringing its total MA lives to over 800,000.  Cigna CEO David Cordani says he believes in MA but as part of Cigna’s service business, Evernorth. Cigna struggled with its MA business in terms of Star scores, enrollment, and profitability.  HCSC will need to turn the business around and it comes at a tough time for MA overall.

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#hcsc #cigna #medicareadvantage

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Study Finds Less MA Post-Acute Care Services But No Increase in Readmissions

Medicare Advantage (MA) plans covered less intensive post-acute compared with the traditional Medicare fee-for-service (FFS) program, a study shows.  The study found no significant difference in short-term outcomes. There were no changes in 3-day readmissions either. The authors said more research is needed to determine whether care management by MA plans or other reasons accounted for no negative changes.  At the very least what it shows is that there are excesses in FFS.  CMS has just changed prior authorization criteria to mandate that MA plans cannot deny admission to a post-acute setting and/or redirect the care to a different setting if a physician orders it.  This, along with impacts related to the two-midnight rule regarding observation vs. inpatient admission, will drive up costs considerably.  A rotten and political decision by CMS that is bad for our healthcare system.

#priorauthorization #medicareadvantage

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Benefits Reined In By MA Plans for 2024

I don’t love this article from MedPage Today.  From an author that tends to be negative on Medicare Advantage (MA) in favor of traditional fee-for-service (FFS) and providers.  But overall the article is reasonably balanced.  What I noted was her analysis that there was a major decline in benefits from 2023 to 2024, which shows the impact of lower rates, rising utilization, and ugly regulatory rules from the Centers for Medicare and Medicaid Services (CMS). 

#medicareadvantage #priorauthorization

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House Democrats Explore Drug Shortages

As in the Senate, House Democrats are asking questions on drug shortages, including critical cancer drugs.

#drugshortages #drugpricing

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Poll Shows Healthcare Costs And Affordability Are Key Issues For Voters

The Kaiser Family Foundation says its poll shows that healthcare affordability and costs are big issues for voters.  In a recent blog ( https://www.healthcarelabyrinth.com/republicans-have-a-compassion-gap-but-trump-gives-democrats-momentum-on-healthcare-anyway/ ), I argued that Republicans have a compassion gap on healthcare.  This could be a deciding issues in some swing districts.

Additional chart here: https://www.kff.org/interactive/kff-health-tracking-poll-the-publics-views-on-the-aca/#?response=Favorable–Unfavorable&aRange=twoYear

#healthcare #healthcarerform #coverage

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— Marc S. Ryan

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