appointments

Projections for the next ten year show tremendous growth in healthcare costs Each December, the Centers for Medicare and Medicaid Services (CMS) Office of the Actuary releases its official and complete National Health Expenditure Data (NHED) for the previous year. So, in December, we will see the final 2024 results. Given the now expected $5 trillion plus in expenditures, it takes literally a year to sum it all up and categorize it. Each June, though, the CMS actuary issues an estimate for the prior year and projects expenditures out ten years. We just got the CMS actuary’s projections for 2024 to 2033. As expected, the news is not good. The actuarial projections show a chilling annual trend that will have huge repercussions on costs over the next decade. More importantly, the huge growth in spending will impact coverage, benefits, employer costs, and out-of-pocket costs for Americans. Why is NHED so

Major healthcare developments, including the budget reconciliation bill moving UPDATED FOR SENATE BUDGET DEVELOPMENTS: It has been a banner ten days for healthcare news. While more has been reported, here are my top six developments, starting with the status of the budget reconciliation bill. Budget Reconciliation Status as of 6/30 – After passage of the bill in the House on May 22, the Senate finally acted on its version over the weekend. A procedural vote to open debate passed on a 51-49 vote Saturday, with conservative Rand Paul, R-KY, and Thom Tillis, R-NC, voting “no.” Paul likely will never support the bill due to debt concerns. The debt limit is actually hiked $5 trillion vs. $4 trillion earlier. Pragmatic conservative Tillis opposes the deep Medicaid reductions. But the bill’s passage is by no means certain right now. A lot has to happen before final passage. The bill will go through

Medicare Advantage plans still plugging along with enrollment growth A quick blog to tell you about enrollment growth in Medicare Advantage (MA) from May 2025 to June 2025. MA growth slowed down from 2024 to 2025 because of the financial woes of the MA industry. But the rolls are still growing due to aging and the popularity and value of MA compared with the archaic traditional Medicare (fee-for-service) program. What do the latest statistics show? Growth from January 2024 to February 2025 was 4.39% or 1.468 million. (I used February 2025 because of issues with the January 2025 statistics). Enrollment in MA reached 34.941M in February 2025. In June 2025, it reached 35.357M. MA enrollment grew about 115K from May to June and about 416K from February to June. How did Big MA do? From January 2024 to February 2025, Big Plan MA enrollment performed very poorly because of retrenchment

Sensible reductions to healthcare costs could be made and spare major impacts to coverage. Readers and listeners have written in asking the following: Any cuts to healthcare programs would likely impact coverage, but are there smarter cuts that could be enacted? It is a great question, and the answer is yes. There are sensible reductions to healthcare costs that could be made, and it could mean much less impact on coverage. More importantly, it could set the stage for comprehensive healthcare reform. The problem with budget reconciliation cuts The problem with the Republican proposals wending their way through Congress is that these are clear and deliberate reductions to Medicaid and Exchange coverage. Whether the reduction is centered on work requirements or limitations of provider taxes, it is clear that the changes would stop many from accessing healthcare coverage and lead to states contracting benefits and coverage as well. The GOP

RADV instructions show CMS is serious about attacking overpayments, but is the approach fair? The Centers for Medicare and Medicaid Services (CMS) is true to its word. Late Friday the agency published methods and instructions for Risk Adjustment Data Validation (RADV) audits for Payment Year (PY) 2019. In addition, a companion Frequently Asked Questions (FAQ) document was published. The agency announced on May 21 it will audit all eligible Medicare Advantage (MA) plans for each payment year in all newly initiated audits and invest additional resources to expedite the completion of audits for payment years (PYs) 2018 through 2024. Details of the announcement and some of my concerns are in this June 5 blog: https://www.healthcarelabyrinth.com/cms-to-audit-all-plans-on-risk-adjustment/ . On May 12, I also did a blog here ( https://www.healthcarelabyrinth.com/could-medicare-advantage-overpayments-be-considered-to-offset-deep-medicaid-cuts/ ) on the possibility that MA risk adjustment overpayments would be part of the budget reconciliation bill to increase savings and perhaps alleviate

Health plans are in store for a few more rough years On June 12, I blogged about how mighty Big Healthcare has fallen ( https://www.healthcarelabyrinth.com/how-the-mighty-have-fallen/ ). I weighed in on the current pain many large health plans feel and the fact that their vertical integration has not really saved some of them during a downturn. On April 24, I discussed how Compound Annual Growth Rate EBITDA (CAGR EBITDA) dropped by 1.2% from 2019 to 2024 ( https://www.healthcarelabyrinth.com/big-healthcare-struggling/ ). So, will all these struggles continue for the foreseeable future, despite most big health insurers seemingly beginning to dig themselves out of their financial mess? My view – healthcare trends as well as government actions will most assuredly mean continuing bumpy times in all lines of business. Trends Let’s look at trends that we will see globally and by line of business. What will plans need to do? Thus, across the board,

The mighty big healthcare companies have fallen, in this case a victim of their own financial mismanagement and shenanigans. The struggles and in some cases the near implosion of several large national vertically integrated health plans or Big Healthcare have been surprising to many, including me. The biblical phrase “How the mighty have fallen” from Samuel seems particulary relevant right now. David’s lament for King Saul and Jonathan indicates no one is immune from hardship, not even the long-standing, go-to investments in healthcare. Big Healthcare certainly had some external forces undermining its health, but it too was a victim of its own financial mismanagement and shenanigans. The crash offers some insights into the wrong way to attack running a health insurance business these days. United’s woes The most notable failure of late is the UnitedHealth Group. After consistently reporting better news than most of its peers the past year or

The GOP pivoted from an overt ACA repeal in 2017 to stealth policy changes today, but the budget reconciliation bill still will reduce coverage. A number of readers and listeners have contacted me to have me help sort out the number of Americans who will be uninsured if the House-passed budget reconciliation also clears the Senate. After all, they note, didn’t President Donald Trump, House Speaker Mike Johnson, and other GOP officials promise no coverage cuts in healthcare, at least in Medicaid? It is a great point and here is my take on it. First, we need a little history. Back in 2017 under Trump 45, the president and a GOP Congress explicitly set out to repeal insurance coverage by substantially gutting the Affordable Care Act (ACA). A repeal bill passed the House, but a skinny one failed in the Senate when Sen. John McCain, R-AZ, returned from his terminal

Risk Adjustment Data Validation (RADV) bombshell should worry Medicare Advantage (MA) plans In a bombshell announcement, beginning immediately the Centers for Medicare and Medicaid Services (CMS) will audit all eligible Medicare Advantage (MA) plans for each payment year in all newly initiated audits and invest additional resources to expedite the completion of audits for payment years (PYs) 2018 through 2024. MA opponents and a bipartisan group of lawmakers have raised issues with what they view as immense overpayments, some of which are tied directly to risk adjustment scoring. CMS says risk adjustment overpayments are about $17 billion a year. CMS’ completed audits for PYs 2011–2013 found between 5% and 8% in overpayments. Richard Kronick and his colleagues at the University of San Diego find that risk scores are 18.5% greater in MA in 2021, amounting to $33 billion. The Medicare Payment Advisory Commission (MedPAC) estimates the risk scoring overpayment figure could

A number of chapters in my book, The Healthcare Labyrinth (available at this site and through leading booksellers), tell the story of American healthcare’s conversion from a fee-for-service system to managed care. The truth is that the conversion has not yet fully matured. We still have an over-reliance on traditional transaction payments, which promotes a cost spiral as well as hurts quality attainment. So, the conversion is still in flight and so far I see four so-called conversion cycles of managed care, with the latest hitting just recently. With each cycle, we seem to make some progress toward a better system, but find major barriers still exist. Let’s take a look at the four conversion cycles and where we are headed. I have put together a quick reference table to help illustrate managed care’s maturation over time. Birth of Managed Care – 1970s to 1990s Description/Challenges – The traditional, fee-for-service