Senate Now Zeroing In On Medicare Advantage
The Senate appears to be zeroing in on Medicare Advantage (MA) overpayments for the budget reconciliation bill to achieve greater savings and perhaps reduce Medicaid cuts. MA plans and lobbies are lining up to oppose it, saying the reductions will impact enrollees. Sen. Bill Casidy, R-LA and Chairman of the HELP Committee, is one GOP senator examining it, which has bipartisan support (not that Democrats will vote for the bill).
Exactly what would be included is open. One report says the provision would save $100 billion over the 10-year horizon and would limit the ability to include old or unrelated medical conditions in the cost of care. Another proposal would save as much as $275 billion over 10 years. Very high estimates suggest total overpayments from risk adjustments are $43 billion annually (although I have great doubt about that number).
The Centers for Medicare and Medicaid Services (CMS) recently announced 100% audits of risk adjustment in MA. UnitedHealthcare and Humana recently backed partial reform related to diagnoses only tied to health risk assessments from home visits as well as from manual chart reviews. Moderates and pragmatic conservatives such as Sen. Josh Hawley, R-MO, are worried about both Medicaid and Medicare cuts.
In other news, the Health and Human Services’ Office of Inspector General (HHS OIG) announced the results of a risk adjustment audit and found that Coventry Health and Life Insurance Co., an Aetna subsidiary, received an estimated $6.9 million in Medicare Advantage overpayments. This was based on samples from 2018 and 2019. HHS OIG identified $752,587 of overpayments in its sample. Extrapolating from the sample, OIG estimated Coventry received $6.9 million in overpayments.
As well, House conservatives have released a 10-page memo with proposals to go deeper in terms of Medicaid cuts in budget reconciliation, including restrictions on the Medicaid Federal Medical Assistance Percentage (FMAP) for expansion populations and further changes to provider taxes that generate state match dollars. These were rejected by House leaders.
Interestingly, the protests in Los Angeles over the White House’s deportation efforts could boost reconciliation efforts as tens of billions are included in the bill for border security and enforcement staff.
My view on including Medicare overpayments: far-reaching reforms of risk adjustment in the bill likely would continue the negative effects on MA benefits, coverage, and geography going into 2026. We already expect further retrenchment despite a better 2026 rate hike announcement. But it is hard to argue against carefully crafted reforms that get to ruling out abusive practices of a small number of plans that generate a huge windfall.
Additional articles: https://www.beckerspayer.com/policy-updates/insurers-oppose-medicare-advantage-changes-in-spending-bill/ and https://www.beckerspayer.com/payer/aetna-subsidiary-received-7m-in-medicare-advantage-overpayments-audit/ and https://thehill.com/homenews/house/5341366-house-conservatives-senate-gop-megabill/?tbref=hp and https://thehill.com/homenews/senate/5343114-trump-big-beautiful-bill-la-immigration-protests/ and https://www.healthaffairs.org/content/forefront/taking-stock-health-coverage-impacts-house-reconciliation-bill
(Some articles may require a subscription.)
#budgetreconciliation #trump #congress #spending #medicaid #coverage #medicareadvantage #overpayments #riskadjustment
https://thehill.com/homenews/senate/5341080-republicans-debate-fiscal-deficit-cuts/?tbref=hp
Medicare Advantage Not Getting A Break From Trump
Medicare Advantage (MA) plans had hoped the Trump administration would be kinder and gentler to them. But sometimes the people who know you the best are the harshest.
So far, Trump has not eased Star complexity. As well, the Centers for Medicare and Medicaid Services has promised to rein in risk adjustment abuse and further restrict prior authorization. It also completed the phase in for 2026 of the new v28 risk model, which will have taken over 7% out of rates from 2024 through 2026.
About the only friendly decision has been to cancel the Biden administration’s proposal to expand GLP-1 weight-loss drug coverage in Medicare to those who are obese but have no other underlying disease states.
(Article may require a subscription.)
#medicareadvantage #trump #oz #cms #riskadjustment #priorauthorization #glp1s #weightlossdrugs #drugpricing #stars #quality
https://www.modernhealthcare.com/politics-policy/trump-medicare-advantage-regulation
Employers Getting Worried On Healthcare Coverage Costs
Employers say they must be more strategic in how employer coverage is administered due to surging costs. A new survey from the consulting firm WTW found in its latest Benefits Trends Survey that close to half (44%) of those surveyed said that they faced challenges in delivering on their health benefit strategies given rising costs. WTW found that:
- 44% of employers also plan to address high-cost medical conditions.
- 37% said they’re looking to adopt a high-performance provider network.
Another report says employers are looking to the levers they have available to get their arms around high cost trends. Consulting firm Pharmaceutical Strategies Group released its annual drug benefit design report and found that more employers are beginning to understand new contracting models. This includes “unbundling,” where an employer decouples certain services from the main PBM contract and goes with other vendors.
Additional article: https://www.fiercehealthcare.com/payers/rising-costs-push-employers-rethink-benefits-strategies-wtw
#pbms #employercoverage
Claims Denials In Medicare Advantage High
A study in Health Affairs finds that 17% of initial Medicare Advantage (MA) claims are denied, but 57% of originally denied claims are ultimately overturned. On a dollar-weighted basis, denied claims resulted in a 7.2% net loss of the total billed amount for providers.
The study analyzed 270 million claims from 2019 based on data from Inovalon, which covered about 30% of the total MA market. The data covered many plans and had a broad range of claim types. Denial rates varied by the type of care. Denial rates differed by member demographics.
#claimsdenials #healthplans #medicareadvantage
— Marc S. Ryan
