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February 13, 2024

Showing Strain In MA, PE Deals Dropped Significantly Private equity firms’ investment in the Medicare Advantage (MA) space are way down from a peak in 2021. This is a sign that rising medical expense and regulation is impacting the industry. Just 4 deals occurred in 2023, down from 19 in 2021. Additional article here: https://www.modernhealthcare.com/finance/private-equity-medicare-advantage-pesp-report (Some articles may require a subscription.) #medicareadvantage #privatequityfirms Link to Article Site-Neutral Payment Fight Great Kaiser Health News article on the fight over site-neutral payments.  Advocates want site neutral and won passage in a small way on Part B drug infusion in the House.  Hospitals are using their weight and dollars to keep it out of any bill.  In a related move, advocates are proposing a possible rural exception to a site neutrality to get the reform passed. See here: https://insidehealthpolicy.com/daily-news/site-neutral-proponents-float-rural-exemption-hospitals-flag-risks (Some articles may require a subscription.) #siteneutral #medicare Link to Article Texas Federal Judge

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February 12, 2024

Kaiser Turns Around Performance Kaiser Permanente moved from a $1 billion loss in 2022 to about breakeven at least in terms of operating income in 2023.  Its income was $4.1 billion with investments.  It reached the $100 billion mark in both operating revenues and expenses. #kaiserpermanente #managedcare Link to Article Article Summing Up Congressional And Regulatory Issues On AI A good article on all the activities surrounding the use of AI and possible regulations.  The article discusses potential Capitol Hill bills, recent rules and guidance from the Centers for Medicare and Medicaid Services (CMS) and lawsuits against insurers on AI issues. #ai #claimsdenials #priorauthorization Link to Article Humana Study Shows Discrimination In Healthcare A new study sponsored by Humana focused on structural determinants of health rather than social determinants.  The study found that 88% of respondents reporting healthcare discrimination were black. While similar and related to social determinants, structural determinants

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February 9, 2024

Senate To Tackle Medicare Physician Formula A bipartisan group of senators will tackle long-term reform of the Medicare physician pay formula. On 1/1, a 3.4% reduction went into effect due to the existing formula.  Some have accused physicians of spending more time lobbying on health plan prior authorization reform than on their own rate issues. #medicare #physicians Link to Article CMS Wants Tougher Regulation Of Accrediting Organizations A proposed rule from the Centers for Medicare and Medicaid Services (CMS) wants reform of how accreditation organizations operate, including conflict of interest and other requirements in force for other organizations. CMS Fact Sheet here: https://www.cms.gov/newsroom/fact-sheets/accrediting-organization-proposed-rule-fact-sheet Additional article here: https://www.fiercehealthcare.com/regulatory/cms-proposes-greater-oversight-consulting-limitations-accrediting-organizations (Some articles may require a subscription.) #cms #healthplans Link to Article Provider Lobbies Pushing PA Reform At State Level A number of states have enacted and more will enact broad reforms of prior authorization (PA).  Generally these reforms revolve around electronic PA transmission,

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February 8, 2024

Weighty Lesson For Employers From NC State Employee Plan Experience On GLP-1 Drugs A lesson for employer groups as weight-loss drugs take off in popularity.  An analysis of data says that just 25 of over 6,200 prescribers in the North Carolina State Employee Plan accounted for 8 percent of the costs of prescriptions for costly weight loss drugs. These include GLP-1 meds Wegovy and Saxenda. These drugs accounted for 10% of total costs – or over $100 million. The state wanted to rein in costs with some ideas, but its pharmacy benefit manger shot them down. Shame on the healthcare players to not work with employers battling these cost issues. As important, there are telehealth entities now emerging, backed by private equity, advertising solely to prescribe such meds.  It is corrupt. #weightlossdrugs #drugpricing Link to Article Good News From Oscar Health; It Favors ACA Subsidy Extension Oscar reported major enrollment

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February 7, 2024

House Republicans Vote To Ban QALYs House Republicans passed a bill to ban the use of the controversial Quality Adjusted Life Years (QALY) measurement in federal programs.  Additional article here: https://www.fiercehealthcare.com/payers/house-republicans-vote-ban-pricing-metrics-federal-programs #qalys #medicare #medicaid Link to Article Fitch Says MA Trends Will Mean A Credit Neutral Outlook Fitch Ratings says that the spike in medical expense and rate reductions in Medicare Advantage (MA) will end up being credit neutral, arguing plans are well-placed to weather a storm. #medicareadvantage Link to Article Even With Good 2023, CVS Health Saw Utilization Spike and Cuts Its 2024 Outlook CVS Health is cutting its 2024 outlook in the face of a utilization and medical expense spike at insurer Aetna. It otherwise had good 2023 results.  CVS also agreed with Humana and Centene that the 2025 rate announcement was inadequate. Additional articles here: https://www.fiercehealthcare.com/payers/cvs-earns-350-billion-revenue-2023-over-77-billion-profit and https://www.modernhealthcare.com/insurance/cvs-health-medicare-advantage-utilization-2024 and https://www.forbes.com/sites/brucejapsen/2024/02/07/cvs-health-profits-hit-2-billion-as-company-benefits-from-new-provider-businesses/?sh=443dc8d5507b (Some articles may require a subscription.) #cvshealth

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February 6, 2024

Centene Reports Good Numbers, But Cautions On MA Rates Centene reported good numbers to Wall Street today, with notable increases in its Exchange line of business. Medicaid enrollment dropped due to redeterminations. But like Humana, Centene is cautioning that the Medicare Advantage (MA) 2025 rate announcement was inadequate and could lead to further benefit and other changes in its MA line. It also notes that other regulatory changes are impacting its MA investment.  Centene has already pared back benefits and geographies to bring its MA line to a better financial position. Additional articles here: https://www.modernhealthcare.com/insurance/centene-medicare-advantage-rate-cut-2025-sarah-london and https://www.healthcaredive.com/news/centene-medicare-advantage-rate-drop-2023-earnings/706620/ Two other articles on the fallout from MA rates and regulatory changes here: https://www.modernhealthcare.com/insurance/medicare-advantage-rate-cut-2025-reimbursements-benefits-unitedhealth-humana and https://www.statnews.com/2024/02/05/cano-health-bankruptcy-medicare-advantage/ These articles underscore what I said in these blogs: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/ and https://www.healthcarelabyrinth.com/2025-rates-for-medicare-advantage-plans-look-tight/ (Some articles may require a subscription.) #centene #medicareadvantage Link to Article Another Big Week For Drug Policy Much like last week, this week is very

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February 5, 2024

Spectacular But Not Unexpected Fall Of Cano Health Showing that healthcare remains a risky place, Cano Health announces bankruptcy and a spectacular collapse for the provider organization that enters into risk arrangements with Medicare Advantage (MA) and Medicaid managed care. The MA market has been tough for both plans and providers. The new CEO has been trying to refocus efforts in better market areas by exiting questionable areas. Questions are being raised about why Humana, a major stakeholder, will not buy the firm outright.  Additional articles here: https://www.modernhealthcare.com/digital-health/cano-health-bankruptcy-mark-kent and https://www.healthcaredive.com/news/cano-health-chapter-11-bankruptcy-restructuring-agreement/706546/ (Some articles may require a subscription.) #medicareadvantage #humana #providers Link to Article Humana Reacts To CMS MA Rate Announcement Humana reacted publicly today to last week’s rate announcement. Despite the reduction being larger than expected, it reconfirmed its more recent guidance on earnings. The final rates could be higher. See my recent blogs on the subject: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/ and https://www.healthcarelabyrinth.com/with-medical-expense-rising-what-are-health-plans-to-do/ Additional

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February 2, 2024

Cigna Chief Explains Medicare Advantage Exit Cigna CEO David Cordani told investors today that he believes in Medicare Advantage (MA) but it is better for his service business, not his insurance line. In an upbeat investor call, Cordani said that the Medicare line would have required major investments that were not justified based on the size of the portfolio, but that Medicare holds great promise as a service element of its growing Evernorth business.  He said Cigna will double down on Evernorth grow.  Its report on medical loss ratio was very good as were the financials.  Some still question the decision to shed the MA lives. In the current environment for MA, Cordani’s decision may look right.  But will it be the right one over the long term? Or, is this a short-term calculation and Cordani will go back after Humana again down the road? Stay tuned. Additional articles here:

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February 1, 2024

MA Issues Trickle Down To Providers And Vendors This article focuses on Medicare Advantage (MA) troubles – rates, utilization, medical expense, and punitive regulatory requirements – and how they impact insurers, value-based-care providers, and vendors. My intel suggests that the traditionally flush global and partial risk funds that insurers have with providers around the country (providers share in profits when they help reduce costs and improve quality) have dried up or are drying up. Providers are already attacking insurers on numerous issues and this development will only make such relationships even worse. Note as well the reference to MA plans emphasizing profitability by reining in market growth and benefits.  I say just this in my blog on the topic here: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/ . As well, see my just published blog on the 2025 MA payment proposal: https://www.healthcarelabyrinth.com/2025-rates-for-medicare-advantage-plans-look-tight/ (Article may require a subscription.) #medicareadvantage #vbc #providers Link to Article Scan Group CEO Recommends

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January 31, 2024

Another Flat Year For Medicare Advantage Before Risk Score Trends The Centers for Medicare and Medicaid Services (CMS) announced the 2025 rate hike for Medicare Advantage will be relatively flat. This is similar to what happened in 2024 after big increases in 2022 and 2023.  The effective growth rate was up, but the phase-in of a new risk adjustment model basically offsets those gains. The final notice may push these numbers up a bit. If you include risk score trends, MA revenue could increase by about 3.7%. So real revenue should be up, but health plans don’t like thinking of it that way as they think risk score trends tie to increased medical exposure.  I include all these articles here but read with caution as many reporters interpret things differently. In the end, this is not the worst news, but it is bad in the face of some major medical

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