March 15, 2024

Medicare Households Spend The Most On Healthcare Costs

Good article from Fierce Healthcare and analysis from Kaiser Family Foundation on healthcare spending in Medicare households. Medicare households spend more on healthcare than other households. Health spending burden was twice as high.

Analysis by KFF: https://www.kff.org/medicare/issue-brief/medicare-households-spend-more-on-health-care-than-other-households/

#coverage #costs #medicare #medicareadvantage

Link to Article

AHA Survey Says 94% Of Hospitals Impacted By Change Cyber Attack

While for-profit hospitals are going out of their way to send a message of stability after the Change Healthcare cyber attack, an American Hospital Association (AHA) says 94% of hospitals were impacted. Mounting evidence from providers (impacted by up to $1 billion a day in revenue) and health plans (claims dried up!) that this will have big and lingering impacts.

While some systems are back online, the sheer magnitude of the missed throughput of transactions is amazing and will take time to work through the backlog and regular transactions.  Meanwhile, providers could face major liquidity issues. United HealthGroup’s and the federal government’s response has been haphazard and inadequate.  Not only do we need cyber preparedness funding, but also planning and best practices for impacts.

In other news, provider groups are attacking plans for not immediately agreeing to prior authorization (PA) flexibility. Let’s be clear, this is not a health plan issue and plans are already dealing with major new regulations that restrain PA anyway.

As well, administration officials were pressed on what has been done and what more needs to be done. On a bipartisan basis, they did lay blame on the administration for its delayed response. They wisely indicated that previous reluctance to take cyber attacks seriously throughout the industry may be one root cause to all this. This could lead to national legislation.

Additional articles: https://www.modernhealthcare.com/politics-policy/change-update-congress-cybersecurity-legislation and https://www.fiercehealthcare.com/payers/payers-providers-continue-tussle-over-change-healthcare-cyberattack-response and https://www.fiercehealthcare.com/regulatory/senate-finance-committee-grills-becerra-hhs-role-change-healthcare-cyberattack

Also, a great Health Affairs Forefront blog on Change Healthcare, UnitedGroup’s purchase of it, why the cyber attack might have happened, and thoughts about our nation’s vulnerability when so much is concentrated in one company. The arguments are compelling. Although I don’t agree with everything, some of the main themes for administrative change are in my book, The Healthcare Labyrinth (available at this site) : https://www.healthaffairs.org/content/forefront/change-healthcare-incident-change-health-care

(Some articles may require a subscription.)

#changehealthcare #cyberattacks

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Troubling Healthcare Trends In Bay State

A new Massachusetts report is finding that total healthcare expenditures are increasing well beyond national trends – 5.8% from 2021 to 2022 compared with 4.1% nationally.  It also reports huge increases in premiums and cost-sharing. The state is one of a few that also has a cost-containment cap or benchmark. 

#mass #healthcare #costs

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Healthcare Roundup From Fierce Healthcare

Major stories in Fierce Healthcare’s roundup:

  • GOP senators wants the Health and Human Services Office of Inspector General to investigate catheter fraud in Medicare. The House GOP has already called for this.
  •  The Centene CEO is hopeful that Affordable Care Act (ACA) premium enhancements will not die because Trump’s tax cuts end the same year.
  • Experts cite these 9 issues not in the Biden budget and are in need of attention:
    • Medicare Advantage
    • Physician payment reform
    • Merit-based incentive payment system
    • Alternative Payment Model extension
    • Telehealth
    • Site-neutral policies
    • AI strategy in healthcare
    • Healthcare worker well-being
    • PBM reform

#healthcare #healthcare reform #pbms #drugpricing #aca #obamacare #exchanges siteneutral #medicareadvantage

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Medicaid Managed Care Seeing Healthy Rate Increases

States are recognizing the challenges of Medicaid managed care plans and responding with reasonable increases.  So far, at least seven states intend to boost rates for plans.  Plans are expected to see huge drops in rolls as well as increases in overall risk due to redeterminations. While state coffers will be tighter due to a shift of costs to them, they are acting responsibly by recognizing the challenges. Managed care is a good three-quarters of non-LTC Medicaid in most states.

(Article may require a subscription.)


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MedPAC Officials Discuss Overpayment in Medicare Advantage

The chairman and director of MedPAC co-authored a blog in Health Affairs Forefront on overpayment in Medicare Advantage (MA).  I do not agree with much of what MedPAC has said in the past and have some issues with what is presented in the blog.  However, this is a recommended read because it is dispassionate compared with many critics’ arguments. As well, it lays out what I would characterize as the main issue critics see and where federal officials are likely to go.

The authors say that MedPAC has concluded that for 2024 Medicare is spending 22% more for MA enrollees than it would if these beneficiaries were in traditional Medicare. This is a projected $83 billion.  I challenge some of those calculations, but also admit that MA does need to be reformed to some degree.

The blog says that 13 of the 22 points of the payment gap is centered on risk adjustment and coding intensity (after accounting for the annual coding intensity adjustment).  So a good 60% or so of the problem they see is on risk adjustment.  Again, this is where the Centers for Medicare and Medicaid Services (CMS) will look.  Some of this may go away over time with Risk Adjustment Data Validation (RADV) audits.  But CMS will look to a number of ways to tighten the scores. They began with an overhaul of the risk model.  They could increase the negative coding intensity factor as well as make other reforms to risk adjustment and RADV.

It was helpful that the chairman and director admitted there is evidence of both under-coding in traditional Medicare as well as over-coding in MA.

In summary, plans need to thoroughly digest this article.  Again, it is reasoned vs. zealous and likely will be used as the road map for CMS – whether you agree with it or not.  

(Article may require a subscription.)

#riskadjustment #radv #medicareadvantage

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KFF Outlines Uninsured Population And Eligibility Status

The Kaiser Family Foundation (KFF) finds that there were about 25.6 million non-elderly uninsured in the nation in 2022. About 25% of them were Medicaid eligible and 35% were eligible for some for of an Exchange subsidy. About 6% were in the coverage gap and not eligible for either Medicaid/children’s coverage or an Exchange subsidy. About 20% were not eligible for the Exchanges because they were deemed eligible for affordable employer coverage. About 15% were not eligible due to immigration status.

It is interesting that we could get our uninsured problem to a manageable level if people would take advantage of eligibility they have for Medicaid, children’s coverage or the Exchanges.  In addition, we could reform how we think about affordability and even the generosity of subsidies at higher income levels (300% of the federal poverty limit and on). Too, we could solve for the coverage gap by making these folks eligible for Exchange subsidies.

This would not solve the underinsured crisis, which touches employer coverage and the Exchanges.  But it would solve much of the problem we see today. My book, The Healthcare Labyrinth (available at this site) discusses many of these problems.

We need to realize that investments in affordable and consistent coverage will save us dollars in the long run.

#aca #obamabcare #exchanges #coverage

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— Marc S. Ryan

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