#2024

Attacking health plans is fashionable, but calling them the bogeyman detracts from real reform In various cultures, a bogeyman is a shapeless monster used to scare children into good behavior. And there is little question that politicians – from Donald Trump to Democrats to Republicans — increasingly cast health plans as bogeymen in the debate over affordability. For Democrats, health plans have always been the evildoer. Democrats and other critics argue that insurers are earning enormous profits, wasting huge amounts on administration, and essentially ripping off consumers. But Republicans increasingly talk of health plans as responsible for the affordability crisis as well, frankly because they have done little to remedy the problem. Indeed, just as insurers were registering terrible margin numbers, President Trump repeatedly criticized insurers, saying they are making “billions and billions of dollars.” He argued that government healthcare money should go directly to individuals rather than insurers. A

AI is here to say, but Dario Amodei’s admonition needs to be taken seriously. The debate over artificial intelligence just took another major turn. Anthropic CEO Dario Amodei, one of the people at the center of the AI revolution and one of its most thoughtful leaders, has issued another major warning about where AI could be heading. His message is not that we should abandon AI. Amodei has been outspoken about AI’s extraordinary potential to accelerate science, medicine, and economic growth. His concern is that capabilities may be advancing faster than our ability to understand and control the risks. In an essay, he said that, unless development slows and safeguards are put in place, rogue bots could take over the web in a few short months or bad actors could seize control of AI tools. His proposed reforms include having outside evalulators gain access to each froniter lab to ensure

While cut points and averages surged, a lot goes into whether overall ratings will go up as well. Plan Preview 2 is here and today I am covering two topics. 1 – What will the Centers for Medicare and Medicaid Services (CMS) do on the Stars Ratings front? 2 – What do the cut points, average values, and average ratings tell us about whether overall ratings will go up? What will CMS do on Star Ratings? As we know, when the Clover lawsuit decision occurred, CMS quickly moved to recalculate a Clover contract using the court Clover Specific remedy. A short time later, CMS recalculated all other contracts using a “better of” Original Ratings and a CMS Recalculation methodology that simultaneously conformed with the court decision and ignored it. Three new lawsuits emerged, which are pending now. First, Elevance Health is arguing that it deserves a recalculation based on the

Huge surges annually in employer healthcare costs continue to drive an affordability crisis. I have been writing a great deal lately about the coming coverage crisis in America. Much of the attention — understandably — has been focused on the Affordable Care Act (ACA) Exchanges and the expiration of the enhanced premium subsidies. Roughly 24 million Americans are enrolled in Exchange coverage, and the loss of enhanced subsidies will have a profound impact on affordability and enrollment. I have argued that this is bad policy. While I support reforms to the enhanced subsidies, including requiring everyone to contribute something toward coverage and instituting much stronger fraud and enrollment controls, allowing affordability to deteriorate dramatically makes little sense. But there is a much bigger healthcare affordability story developing. It affects the more than 164 million Americans who receive health insurance through an employer. That makes employment-based insurance, by an enormous margin,

Strap in for the Clover Stars roller coaster ride. We are still violently looping around. Just when you thought the Clover Health Star Ratings saga could not get any more complicated, it has. In my August 17 blog on the fallout from the Clover decision, I laid out again what I call the growing “balkanization” of Medicare Advantage (MA) Star Ratings. We effectively have different potential rating scenarios depending on which interpretation of the Clover decision is applied. And different health plans are now in court seeking the calculation that benefits them the most. Since then, we have had three important developments. First, the SCAN Health Plan and Alignment Healthcare cases are moving forward in Washington, D.C. Second, a federal judge denied Elevance Health’s request for a preliminary injunction, but gave Elevance some very encouraging language on the merits. Third, the Centers for Medicare and Medicaid Services (CMS) has now

The House still looks very likely to flip to Democratic control, with the Senate still in limbo As the midterms approach, I always give you a fresh look at what could happen in terms of control of Congress. Back on June 8 I did my last forecast. I likely will do this again in late September and more frequently after that. As I have said, healthcare will be a big part of how votes are cast in November. Affordability overall is a top issue this election year and healthcare affordability dominates this issue in many ways. The GOP at a disadvantage As I have said in past blogs on the midterms, the GOP has a huge uphill battle to keep control of both chambers. I looked at every midterm election since 1934. No matter how popular a president might be, only on two occasions has the party in control of

August enrollment shows MA continues to grow, with SNPs a majority of the increase In a February 16 blog, I detailed the growth in Medicare Advantage (MA) from February 2025 to February 2026 after a delay from the Centers for Medicare and Medicaid Services (CMS) in posting the annual data. As I noted, the January enrollment statistics in both years seemed off so many analysts are comparing February to February each year. Each month since then, I have updated with monthly growth numbers. Now, we have August results. For those who may have missed earlier blogs, I am refreshing on some of the annual results. The annual statistics show some of the financial struggles the industry continues to have. Annual growth is way down compared with prior years in the 2020s due to major geographic contractions as well as plan benefit reductions by major MA players the past few years.

2027 will be four years running for cubacks in MA If Medicare Advantage plans thought 2027 would finally mark the end of the industry’s painful retrenchment, they may want to think again. The early signs point toward another year of significant market exits, benefit changes, network adjustments and efforts to control enrollment. And this isn’t exactly new. Medicare Advantage has essentially been going through a multi-year reset since 2024. Rising utilization, inadequate rate trends, the new risk adjustment model, other worries on risk adjustment recoupment, deteriorating Star ratings, and other regulatory changes hit an industry that had expanded aggressively during the preceding years. The result has been a painful process of getting the economics back in balance. 2027 looks increasingly like year four of the MA reset The problems really emerged in 2024, when medical utilization increased far beyond what some insurers had anticipated. Seniors returned for procedures and services

ICHRAs growing and respond to affordability issues Individual Coverage Health Reimbursement Arrangements (ICHRAs) are getting more attention. And they should. I think ICHRAs are an interesting option that can expand coverage and give employees more choice. But as with almost everything in healthcare, we should distinguish between changing who pays for healthcare and actually making healthcare more affordable. That is an important part of the healthcare debate. What is an ICHRA? An ICHRA, just rebranded as CHOICE Arrangements or Custom Health Option and Individual Care Expense, allows an employer to provide employees with a defined amount of tax-advantaged money that employees can use to purchase individual health insurance coverage rather than enrolling in a traditional employer-sponsored group plan. In some ways, it is the healthcare equivalent of the shift from defined-benefit pensions to defined-contribution retirement plans. The employer establishes its contribution, while the employee has more responsibility—and potentially more choice—in

The fallout from the Clover Health Medicare Advantage (MA) Star Ratings decision has become considerably more complicated. What started as one health plan challenging its 2026 Star Rating has now developed into a series of lawsuits that could force the Centers for Medicare & Medicaid Services (CMS) to confront not one, but several competing approaches to calculating Star Ratings. And with Star Year (SY) 2027 ratings approaching, CMS may soon have to decide whether—and how—to extend any of those approaches across MA contracts. The important point is that the plans are not all asking for the same thing. That is where this story gets interesting and potentially very messy. I described this in an earlier blog as the Balkanization of Star measurement. Clover created the opening Clover filed its lawsuit in November 2025 after its largest MA contract received a 3.5 Star rating for 2026. On May 27, 2026, Judge