Dual Eligibles

Medicare Advantage Plans Weigh Pros, Cons of Chasing Health Equity Reward

As part of CMS and the Biden administration’s overall framework for health equity, Medicare Advantage organizations’ ability to assess social risk factors (SRFs) and address care disparities has taken on new importance this year, thanks to the introduction of the Health Equity Index (HEI) to the Star Ratings. Starting in 2027, insurers won’t be penalized for failing to close gaps in care on certain quality measures, but qualifying Parts C and D sponsors will be rewarded if they perform well on the HEI, which CMS has described as a “methodological enhancement” to a subset of existing measures. Quality experts say readiness varies across the industry, and plans need to better understand where to target interventions and where they stack up against other plans that may qualify for the HEI.

And not all plans will qualify: Contracts that enroll a minimum threshold percentage of enrollees with social risk factors (SRFs) will be assessed and divided into three tiers of performance. Plans that perform in the top tier will receive 1 point, the middle tier will receive 0 points, and the bottom tier is assigned -1 point for each measure. After a series of calculations, the points translate to an HEI score that ultimately determines whether plans receive a reward that is applied to quality bonus payments for the 2027 Star Ratings.

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Cycle of Protests Dictates Playbook for Medicaid MCOs, Says Industry Expert

As evidenced by hotly contested Medicaid contract awards in Florida, Kansas and Texas this year, local and regional health plans are increasingly being shut out of opportunities to serve enrollees in their communities. And though a recent administrative law judge decision in Arizona suggests the winds could be changing, community plans need to become more strategic about their approach to procurements, says one industry expert.

Beyond the headlines, “so much more has happened in the Medicaid space than the eligibility redetermination process,” says Clay Farris, founder and practice lead of client solutions at Mostly Medicaid, which offers advisory services to community plans and other stakeholders across the Medicaid continuum. He is referring to the so-called unwinding of policies that were in place during the COVID-19 public health emergency, when a yearslong pause on routine eligibility checks led Medicaid and Children’s Health Insurance Program (CHIP) enrollment to hit an unprecedented 94 million in March 2023. As of Aug. 1, at least 24.8 million people had been disenrolled from Medicaid because of redeterminations, KFF reports.

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News Briefs: Centene Will Exit MA Market in Six States Next Year

For the 2025 plan year, Centene Corp. will not offer Medicare Advantage plans in Alabama, Massachusetts, New Hampshire, New Mexico, Rhode Island and Vermont, Modern Healthcare reported, citing an Aug. 5 note from investment bank Stephens. However, Centene will continue offering Medicare Part D Prescription Drug Plans in those states. Pinnacle Financial Services, a health insurance brokerage, also posted to its website a notice from Centene about exiting those markets, which account for about 3% of the insurer’s MA membership.

BlueCross BlueShield of Vermont, the state’s largest insurer, is on the verge of insolvency, according to a July 29 article in the Burlington Free Press. However, Kevin Gaffney, commissioner of the state’s Department of Financial Regulation, told the newspaper, “BlueCross BlueShield of Vermont is a big tanker. We have to start to turn it. We can do that and there are steps to do it.” Gaffney said he is requiring the insurer to file a plan of solvency by early September. In October 2023, BCBS of Vermont finalized an “affiliation” with Blue Cross Blue Shield of Michigan in which the Vermont plan became a subsidiary of BCBS of Michigan.

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Headwinds Aside, MCOs Foresee Long-Term Growth in Medicaid Managed Care

During recent conference calls to discuss second-quarter 2024 earnings, Centene Corp., Elevance Health, Inc. and Molina Healthcare Inc. all discussed the long-term Medicaid growth opportunity despite declining membership resulting from redeterminations and increasing medical costs — scenarios that they expect to stabilize next year. And while Centene may be scaling back its Medicare Advantage footprint and Elevance pursued a “disciplined approach” to 2025 bids, all three emphasized their continued focus on serving dual eligible Medicare-Medicaid beneficiaries.

For the quarter ending June 30, Centene on July 26 posted adjusted earnings per share of $2.42 and said it is on track to deliver adjusted EPS of at least $6.80 for the full year. The company ended the quarter with more than 13.1 million Medicaid members, down from just over 16 million a year ago. However, its total membership increased slightly to nearly 28.5 million members, with growth in the Affordable Care Act exchanges and Medicare Prescription Drug Plan (PDP) businesses offsetting Medicaid losses. Its overall medical loss ratio for the quarter was a higher-than-expected 87.6%, as cost pressures in Medicaid led to a segment MLR of 92.8% (compared with 88.9% in the prior year quarter).

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New Studies Tout Benefits of High Duals Integration, Pinpoint Shortcomings

As CMS applies pressure on health plans and states to enhance coordination for dually eligible Medicare-Medicaid enrollees and as congressional lawmakers urge momentum for the Delivering Unified Access to Lifesaving Services (DUALS) Act, the path to integrated care remains a challenge in many states. And two recent studies show that beneficial outcomes, even for enrollees in Dual Eligible Special Needs Plans (D-SNPs), are not guaranteed.

In separate analyses looking at the New York and Virginia markets, researchers discovered a wide range of improvement areas that, even among highly integrated D-SNPs (HIDE-SNPs) and fully integrated D-SNPs (FIDE-SNPs), could capitalize on the potential of the D-SNP approach. The study covering the Virginia market, published last month in JAMA Health Forum, analyzed the impact of exclusively aligned enrollment (EAE), which the study authors describe as “the highest level of D-SNP integration.” This occurs when the parent organization’s D-SNP (a type of Medicare Advantage plan) is limited to individuals who are also enrolled in that organization’s Medicaid managed care organization.

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VNS Health Pursues ‘Near Duals’ MA Growth in NYC and Beyond

Medicare Advantage membership growth during both the 2024 Annual Election Period (AEP) and the Open Enrollment Period (OEP) was largely driven by major insurers (namely, CVS Health Corp.’s Aetna) and some of the insurtechs, according to a recent AIS Health analysis. But many of the regional and provider-led insurers that performed well during the AEP also continued their growth through the OEP. One such plan is VNS Health, which has long catered to underserved New Yorkers with complex needs and recently relaunched MA plans designed for Medicare-Medicaid dual eligibles and “near duals.”

As part of an annual series on the growth stories of AEP/OEP “winners,” AIS Health, a division of MMIT, spoke with leaders at VNS Health about their successful reentry into MA.

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With Focus on Future, MA Plan Innovations Hold Promise for Aging in Place

Outside of serving seniors through a Special Needs Plan geared toward institutional/institutional equivalent enrollees, Medicare Advantage plans are not fundamentally designed to support seniors’ long-term care needs. But with their inherent focus on care coordination and recent innovations in nonmedical benefits that can support aging in place, MA plans are uniquely positioned to address gaps in the continuum between Medicare and Medicaid, which is the primary payer of long-term services and supports (LTSS).

Speaking during a prerecorded session of the upcoming Virtual Fifth National Medicare Advantage Summit, panelists agreed that while nonmedical benefits were initially perceived as marketing tools to differentiate plans from their competitors, there is great potential for them to serve enrollees in the long term. Participants in the panel discussion, “The Opportunity for Medicare Advantage Plans to Address Long-Term Care Needs,” which will be livestreamed and archived on July 10, discussed a variety of benefit innovations and the mounting evidence around their impact to costs, outcomes and quality of life.

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CMS Dangles ‘Wild and Crazy’ Opening for Special Needs Plans

After interest among long-term care providers and Medicare Advantage insurers to partner on Institutional Special Needs Plans plateaued during the COVID-19 pandemic, a somewhat ambiguous provision in a recent CMS final rule has the potential to significantly increase the I-SNP market. By expanding the definition of qualifying facilities that serve institutionalized members, SNP experts say it could reduce current barriers to enrollment and garner interest from assisted living facilities (ALFs), which have largely been shut out of the I-SNP opportunity.

I-SNPs, which were permanently authorized in the Bipartisan Budget Act of 2018, currently restrict enrollment to MA-eligible individuals who meet the definitions of “institutionalized” (i.e., they continuously reside for 90 days or longer in one of several types of long-term care facilities or are expected to need the level of services provided in such a facility) or “institutionalized-equivalent,” meaning they reside in an ALF and get the same level of care they’d receive in a qualifying long-term care facility. Such facilities that currently qualify (as defined by Medicaid or Medicare statute) are skilled nursing facilities, nursing facilities, intermediate care facilities for individuals with intellectual and developmental disabilities, psychiatric hospitals, rehabilitation hospitals or units, long-term care facilities and “swing-bed” (e.g., critical access) hospitals.

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News Briefs: SCAN Wins Lawsuit Over 2024 Star Ratings Calculations

SCAN Health Plan won a legal challenge to CMS’s calculation of the 2024 Star Ratings that could have major implications for quality bonus payment (QBP) outlays and 2025 cut point generation. According to a June 3 memorandum opinion filed in the U.S. District Court for the District of Columbia, Judge Carl Nichols agreed with the not-for-profit Medicare Advantage insurer that CMS “failed to follow its own regulation,” which resulted in SCAN receiving an incorrect Star Rating. In a lawsuit filed against HHS in December, SCAN argued that CMS was “arbitrary and capricious” when it applied new guardrails (i.e., restricting the movement of cut points by no more than 5% in either direction) to hypothetical cut points for the previous year rather than actual cut points, yet did not amend its regulations to reflect that decision. Nichols agreed that the “best and most natural reading” of CMS’s so-called Guardrail Rule was that it referred to actual cut points in both the initial year and the following year, and he granted the plaintiff’s motion for summary judgment. SCAN, which serves roughly 277,000 MA enrollees in five states, had a 4.5 Star Rating for six consecutive years until 2024, when it received a 3.5 Star Rating, costing it nearly $250 million in lost quality bonus payments. Elevance Health, Inc. in December filed a similar lawsuit; the insurer in March disclosed that CMS “updated” its original ratings, which will lead to an additional $190 million in revenue for plan year 2025. MA insurers Hometown Health Plan and Zing Health also have similar suits pending, reported Modern Healthcare.

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SFHP Leverages Local Connections, In-House Capabilities to Launch D-SNP

To prepare for new integrated care requirements for dual eligible Californians, San Francisco Health Plan (SFHP) and other Medi-Cal plans are in throes of setting up a Medicare Advantage Dual Eligible Special Needs Plan (D-SNP) in their service area, if they haven’t done so already. During the 15th Annual Medicare Market Innovations Forum, held April 8-9 in Orlando, Florida, SFHP’s Diane Sargent discussed the daunting task of building a D-SNP and the tremendous potential to improve care delivery for up to 47,000 dual eligible beneficiaries in the plan’s service area.

As part of the California Advancing and Innovating Medi-Cal (CalAIM) initiative, the state’s Dept. of Health Care Services (DHCS) is implementing new policies to promote integrated care for duals that build on the Coordinated Care Initiative (CCI), the state’s financial alignment demonstration with CMS that included Medicare Medi-Cal Plans (MMPs) serving duals. Under the first phase of CalAIM, which kicked off in January 2023, DHCS launched D-SNPs in the seven CCI counites. Under an exclusively aligned enrollment (EAE) model, duals access their Medicare and Medi-Cal coverage via the same managed care plan. Managed care plans in non-CCI counties that wish to continue serving dual eligibles must launch EAE D-SNPs no later than Jan. 1, 2026.

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