medicareforall Archives - The Healthcare Labyrinth

August 9, 2024

August 9, 2024 No Comments

What Do Q2 Insurer Investor Calls Tell Us? Q2 2024 investor calls are coming to a close and we see mixed results on the part of insurers. Some insurers, such as Cigna (commercial-dominate, Alignment Healthcare (Medicare Advantage (MA)- dominant), Clover Health (MA-dominant), and Oscar Health (Exchange-dominant), have bucked negative trends. On the other hand, CVS Health, Humana and Centene have been hurt by Medicare and Medicaid rates and cost pressures. United remains dominate, but also reported cost pressures and costs from the Change Healthcare cyberattacks. Elevance Health appears to be performing among the best, growing its services line and mitigating government program pressures with strong commercial performance. #healthplans #insurers #healthcare #earnings https://www.fiercehealthcare.com/payers/medicaid-ma-headwinds-pressure-payers-q2-heres-look-how-major-companies-fared Ten States Are Holdouts On Medicaid Expansion And Are Largely In The Deep South A good article recapping once positive efforts to expand Medicaid in the deep South, all of which failed during recent legislative sessions. The ten

August 8, 2024

August 8, 2024 No Comments

GOP On Attack On Questionable CMS Part D Demonstration The GOP is on the attack over the Centers for Medicare and Medicaid Services’ (CMS) announcement of a demonstration project to stabilize 2025 Part D premiums. CMS hurriedly put together the demo after it saw huge increases in Part D premiums come in during the 2025 bid cycle. This was due to the Inflation Reduction Act’s (IRA) shifting of huge costs from the government to health plans and out-of-pocket cost reductions. CVS, the biggest standalone Part D plan, apparently recommended that CMS create the program, although one already exists in law covering just a piece of the benefit. The conservative Paragon Health Institute says the program could cost $10 billion over three years to limit premiums by bailing out insurers. The IRA approach on Part D was flawed and the public will be hurt by high premiums, but I continue to

August 7, 2024

August 7, 2024 No Comments

CVS Struggles Financially; Undertakes $2 Billion In Cost-Cutting CVS slashed its full-year guidance in its Q2 investor call and has begun a multi-year initiative to generate as much as $2 billion in savings. CVS has been hit by very high utilization in its Medicare Advantage (MA) line and plans to shed about 10% of its Medicare lives in 2025. Its overall medical loss ratio (MLR) is about 90% through 1H 2024. Its Aetna line is performing so poorly that it terminated its recently-hired Aetna president and CVS Health CEO Karen Lynch will take over day-to-day control. She formerly was president of the unit and knows it well. CVS missed its revenue target but exceeded its margin expectations with $1.8 billion in Q2. CVS’ MA line has negative margins now, but the benefit reductions and contraction it plans in 2025 will return it to 4% to 5% MA margins over time. Lynch

August 6, 2024

August 6, 2024 No Comments

Republicans Ask GAO If CMS’ Proposed Part D Premium Stabilization Program Is Legal A group of House and Senate Republicans are asking the congressional Government Accountability Office (GAO) if the Centers for Medicare and Medicaid Services’ (CMS) proposed additional premium stabilization program for standalone Part D (PDP) plans is legal. CMS announced the creation of the program after it received bids that showed premiums would skyrocket despite some protections in the Inflation Reduction Act (IRA). The Part D changes in the IRA were much touted as protecting consumers by lowering out-of-pocket (OOP) costs. It also shifted huge costs to plans. These changes were not adequately funded by the government and thus plans had to reduce benefits in other areas and increase premiums. CMS was caught flat-footed and quickly created the program recently to avoid an October Surprise during open enrollment. I have issues with whether CMS has the statutory authority

August 5, 2024

August 6, 2024 No Comments

Another Devastating Piece From The Wall Street Journal On Medicare Advantage Yet another piece from The Wall Street Journal (WSJ) is bound to generate huge attention on Capitol Hill and among regulators. In its latest expose on Medicare Advantage (MA) finances, WSJ finds that MA home visits’ diagnoses for risk adjustment generated $15 billion in extra pay from 2019 to 2021. WSJ says nurses are pushed to make diagnoses the patient does not have and such diagnoses are never treated by hospitals or physicians. A July article found that $50 billion in overpayments occurred from 2019 to 2021 tied to risk adjustment submissions not treated by healthcare providers. I am a supporter of MA, but I have made the case that a small number of bad actors are generating a huge amount of overpayments and giving all plans a bad name. I have told plans to expect that the Centers

August 2, 2024

August 2, 2024 No Comments

State Affordability Boards Taking On Drug Makers Where The Feds Have Failed Frustrated by high drug prices and inadequate policy changes at the federal level (save for slow-moving Medicare drug price negotiations), states are setting up drug affordability boards that can have vast powers to reduce drug costs. This includes setting an upper limit for sales in their state for certain coverage and the uninsured. This is similar to the Medicare drug price negotiations. Due to federal pre-emption, these boards only apply to commercial plans. Medicaid has a federal rebate law that allows for federal and state rebates. Medicare is not covered as private plans negotiate prices with drug makers through pharmacy benefits managers or directly. Under the self-insured employer ERISA law, employer groups appear to be able to opt in and thus this has been built into some state laws. So far, eleven states have approved establishing drug affordability

August 1, 2024

August 1, 2024 No Comments

Cigna Exceeds Expectations for Q2 The Cigna Group reported Q2 earnings that exceeded expectations, driven by growth in its services business. Total revenue in Q2 was $60.5 billion, up 24.6% year over year. It reported $1.5 billion in net income, up 6%. Cigna is more isolated from Medicare pressures (small line being sold) and Medicaid pressures (no line). Evernorth’s services revenue rose nearly 30% year over year to $49.5 billion. Pharmacy service revenues grew more than 41% to $26.6 billion. In great measure this was due to the migration of Centene from CVS Caremark to ESI. CEO David Cordani also committed to more aggressive defense of the value of its pharmacy benefit manager, ESI. In related news, Cigna says its GLP-1 weight-loss program has enrolled two million. Additional articles: https://www.healthcaredive.com/news/cigna-aggressive-pharmacy-benefit-manager-defense/722638/ and https://www.beckerspayer.com/payer/cigna-posts-1-5b-profit-in-q2-2.html and https://www.fiercehealthcare.com/payers/evernorth-drives-double-digit-revenue-growth-cigna-q2 and https://www.beckerspayer.com/payer/cignas-glp-1-program-enrolls-2-million.html (Some articles may require a subscription.) #healthplans #cigna https://www.modernhealthcare.com/insurance/cigna-earnings-call-evernorth-health-services-revenue-growth-medicare-medicaid Alignment Reports Positive Results Alignment

July 31, 2024

July 31, 2024 No Comments

Humana Meets Expectations in Q2 But With Some Mixed News Medicare Advantage (MA)-dominant Humana released its Q2 2024 results. It had $679 million in profit for the second quarter, down from $959 million a year ago. It had $29.5 billion in revenue for the quarter, compared to $26.7 billion in the second quarter of 2023. It affirmed its already conservative guidance. It revealed that MA rates have complicated its financial performance and that it would shutter some plans in geographies and has reduced benefits in others. It expects to lose about 5% of its projected 2024 enrollment next year, or about a few hundred thousand. It will increase its enrollment this year by about 225,000. Only Humana and CVS Aetna performed well on the enrollment front recently. Its medical loss ratio (MLR) was 89.5% in the quarter, compared to 86.8% in the second quarter of 2023. Humana blames the increased

July 30, 2024

July 30, 2024 No Comments

Biden Administration Will Accelerate 2026 MA and Part D Rule Before Leaving Office Interesting article in Modern Healthcare on plans of the Biden administration to accelerate the Medicare Advantage (MA) and Part D rule for 2026. The draft will be published in September, with the final rule sometime before President Biden leaves office. This could mean huge new policy changes for MA and Part D. Trump did something similar. On one hand, Biden may want to leave office proposing some major reforms. On the other hand, the striking of the Chevron deference precedent could complicate enacting major changes. The possible list of changes I see — they can’t do all of them, could they?: Separately, will he do more on antitrust and horizontal and vertical integration? (Article may require a subscription.) #election2024 #biden #healthcare #regulations #medicareadvantage #partd https://www.modernhealthcare.com/policy/health-rules-2024-medicare-pay-prior-authorization Bipartisan Momentum For Site-Neutral Policies The Health and Human Services secretaries of

July 29, 2024

July 29, 2024 No Comments

CMS Releases Part D Data For 2025; Sets Up Premium Stabilization Program The Centers for Medicare & Medicaid Services (CMS) released preliminary technical Medicare Part D bid information for Contract Year 2025. The Part D base beneficiary premium is capped at 6% growth in 2025 due to a stabilization fund set up in the Inflation Reduction Act (IRA). This was because of all the transfers of costs to plans from the government and caps on out-of-pocket (OOP) costs. The anticipated enrollment weighted-average premiums were not released in part because CMS has proposed to create an additional voluntary premium stabilization demonstration program for standalone Part D (PDP) plans. Many critics of the IRA reforms have suggested that premiums in 2025 could go up 50% to 100% (or more) due to the transfer of liabilities. The stabilization subsidy in the IRA only caps the base premium. Plans enhance benefits and will either have to cut enhancements,

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