#2024

Part D changes will raise premiums and destabilize the program I have been all over this even before it was fashionable. After reading up on some analyses of the Part D cost-sharing changes in the Inflation Reduction Act (IRA), I declared that seniors and those with disabilities would see an October surprise in the form of increased costs going into the election as they chose 2025 Medicare Advantage (MA) or Part D benefits. The Centers for Medicare and Medicaid Services (CMS) initially scoffed at my and others’ predictions, arguing the IRA anticipated this with a premium stabilization program. The problem: it applied just to the base benefit. We know that seniors have come to rely on enhanced Part D drug benefits from MA and standalone Part D (PDP) plans. And since the out-of-pocket (OOP) changes raised plan costs for both the base and enhanced benefits, recipients would have seen major

While cuts will occur, things could be looking a bit better for Medicaid and the Exchanges In a series of blogs just before and after Donald Trump retook office, I speculated that, while there would be spending reductions impacting healthcare, I did not foresee a massive revamp in healthcare programs, specifically for the Affordable Care Act (ACA) and Medicaid. Now that we are about two weeks into the new administration and a fully GOP-controlled Congress, I felt it might be good to update readers on this all-important issue. As you know, I am a pro-coverage Republican. I think reasonably robust coverage is important for the health of our nation and to reduce costs in the future. So, based on some happenings in the past month or so, here are some of the reasons to think healthcare may not be impacted as much as one would think as the budget reconciliation

What will Trump do on Medicare drug price negotiations? In a parting shot at the incoming Trump administration, outgoing President Biden’s administration issued the next list of 15 drugs subject to negotiations in Medicare prior to Biden’s White House exit. The list was due by February 1, so the early release is a challenge to the Trump administration not to repeal the negotiation law included in the Inflation Reduction Act (IRA). The prices on the 15 drugs would go into effect on January 1, 2027 after a process in 2025. In 2024, prices for the first 10 drugs were set and take effect on January 1, 2026. The Centers for Medicare and Medicaid Services (CMS) says that between November 2023 and October 2024 about 5.3 million people with Medicare Part D coverage used these drugs to treat a variety of conditions, such as cancer, type 2 diabetes, and asthma. The

An otherwise responsible agency has an alarming arrogance in its Star oversight and processes For the past two years we have seen major lawsuits against the Centers for Medicare and Medicaid Services (CMS) on how they conduct the Stars program in Medicare Advantage (MA). The Stars program is not only important for grading the quality of outcomes in private managed care, but also is the lifeblood of supplemental benefits and other enhancements to fill in the holes in traditional Medicare fee-for-service (FFS). Without a well-functioning equitable, and reliable Star quality bonus system, we cannot really gauge quality or ensure consistent benefit additions in the MA program. Brief history of 2024 Star lawsuits Lawsuits against CMS on the 2024 Star ratings largely revolved around the implementation of the Tukey outlier adjustment implemented for that year’s ratings. The methodology removes so-called outlier performance at both the top and bottom of performers. Outliers

Published in partnership with Lilac Software: https://lilacsoftware.com Figuring out exactly what will happen in the Star measure program over time is no small feat. The Centers for Medicare and Medicaid Services (CMS) certainly does not make it easy to create a Stars roadmap so you are ready for a new measure maturing to Stars.  CMS will use a variety of means to telegraph what might occur. These include annual Medicare Advantage (MA) and Part D rules, the so-called Advanced and Final Notices/Announcement annually, and other CMS communications. Even then, pulling it all together is tough. Things can change from proposed rules to finalized rules. CMS may give direction on a change in one year only to backtrack the next. You can never be 100% sure until the Advance Notice is finalized for the coming year. This usually drops in April of a given year. Sometimes, as they did with Star

Biden deserves credit for some key healthcare accomplishments Today is Inauguration Day and the torch is being passed from President Biden to President-elect Donald Trump. Many have argued that Joe Biden’s presidency will be remembered as less than stellar, but I wanted to take this chance today as a Republican to reflect on some of Joe Biden’s healthcare accomplishments as he leaves office. My views on healthcare are somewhat unique as a Republican I am a Republican, but I always tell you that I am a maverick one on healthcare. Part of my college discipline was in economics. As such I studied how the market works, consumer behavior, and micro and macro trends. I was also in politics before making my leap to healthcare. As a state budget director, I was known as a fiscal disciplinarian, who always sought low taxes and a balanced budget. At the state level, we

Major new Star measure changes slated by CMS The Centers for Medicare and Medicaid Services’ (CMS) 2026 Advance Notice had major changes and information related to the Medicare Advantage (MA) and Part D Star programs for Star Year (SY) 2026 and beyond. The advance notice provides information and updates on Star ratings as mandated by regulations and solicits input on future measures and concepts. All substantive measure specification changes, the addition of new measures, and methodological changes must go through rulemaking. The 2026 notice outlines non-substantive measure specification updates; solicits initial feedback on substantive measure specification updates and comments on new measure concepts as well as display measures; and solicits preliminary feedback on adding geography to the Health Equity Index (HEI) reward.  Here are the key advance notice highlights: Deadlines Final 2026 Star Year Measures Disasters for Star Year 2026 As well, starting with the 2026 Star Ratings CMS will

Some relief with positive hike, but rate increase still inadequate On Friday, the outgoing Biden administration released its Advance Notice for Medicare Advantage (MA) and Part D rates and other policy changes for 2026. I have reviewed the 180-page Advance Notice, CMS Fact Sheet, and CMS Press Release. Below are the key highlights. The advance notice will be finalized by early April. I will publish a comprehensive Stars roadmap blog on Thursday in conjunction with Lilac Software. This will detail all the proposed Star measure changes, updates, and information discussed in the advance notice. MA rate proposal It is likely that MA plans and investors will see the proposed rates for 2026 with some relief. After two years, it appears MA plans could see a real revenue increase rather than the decreases they saw in 2024 and 2025. But as plans and financial analysts take a deeper look, the proposal

Trump’s goal of extending the 2017 tax cuts could have major implications for healthcare In Monday’s blog, I told you that the incoming Trump administration will be dominated by budget matters in 2025, with an effort to find enough savings to extend the 2017 tax cuts. The proposed Department of Government Efficiency (DOGE) commission seems dedicated to a fundamental remake of government, programs, and regulations. While the Republican or GOP control of both Houses is tight, leaders and the rank-and-file seem ready to hitch their wagons to Trump and his agenda. But as I noted Monday, process and procedures could create challenges. With all this in mind, what might healthcare cut proposals look like? The DOGE, Trump, and congressional GOP lists will likely be culled from various sources including governmental authorities and outside conservative think tanks. The lists below include proposals from the Congressional Budget Office (CBO) and a number

What will the early months of a new Trump term mean for healthcare? President-elect Donald Trump is scheduled to take office on January 20 after coming back from the political dead. Trump will become just the second president to serve non-consecutive terms. For the politically curious, the first was Grover Cleveland in 1885 and then again in 1893. Cleveland beat Republican James Blaine in 1884, winning both the electoral and popular votes. He lost to Republican Benjamin Harrison in 1888. Harrison won the electoral vote, but Cleveland won the popular vote. Cleveland came back to beat Harrison in 1892, getting both the electoral and popular vote. A now more government-savvy Trump has come out fast to put together his agenda and personnel for his second term, a major difference than what occurred in 2017 when Trump looked flat-footed during the transition. Trump already has almost all of his nominees picked