Fee-for-service Medicare

Medicare Advantage Plans Pay Higher Prices Than CMS for Dialysis Care

A new study published in Health Affairs urged government leaders to limit market consolidation among the largest dialysis providers as more and more seniors choose Medicare Advantage over fee-for-service (FFS) Medicare. Analyzing 2016 and 2017 outpatient Medicare claims data, the study authors found that MA organizations paid inflated costs for dialysis services compared to what FFS Medicare would have paid, especially to large national dialysis organizations — where the majority of patients receive treatment. Notably, MA plans’ median cost for in-network hemodialysis (the most common form of the therapy) was $301, which was markedly higher than the $232 median cost for out-of-network treatments. Findings were similar for peritoneal dialysis, the less common form of dialysis.

Overall, MA plans paid 131% of the FFS price for in-network hemodialysis at large chains, compared to 120% of the FFS price at regional chains, and they paid 112% of the price at independently owned facilities. These markups were also found for in-network peritoneal dialysis but were not observed for out-of-network services.

Health Systems May See More Savings With Medicare Advantage vs. Medicare ACOs

A new study published in JAMA Network Open raises questions about whether health systems can actually achieve significant savings through the Medicare Shared Savings Program (MSSP), or if Medicare Advantage could be a better bet. To identify spending patterns in MA and MSSP’s Accountable Care Organizations (ACOs), researchers studied the characteristics and claims data of about 16,000 Medicare patients at Ochsner Health System (OHS), a large, academic system in Louisiana, from 2014 to 2018. Ochsner joined MSSP in 2013, and its ACO hosts more than 2,200 providers. It also offers MA plans via a partnership with Humana Inc.

APG’s Susan Dentzer Discusses Value-Based Care Goals, Challenges Across Medicare

CMS’s Center for Medicare and Medicaid Innovation last year declared a goal of having all traditional Medicare enrollees in an accountable care arrangement by 2030. America’s Physician Groups (APG), which represents more than 300 physician groups that accept various degrees of risk with all payer types, including Medicare Advantage plans, wants CMS to apply that same goal to MA. In a recent comment letter on CMS’s request for information on the MA program, APG President and CEO Susan Dentzer urged the administration to incentivize the delegation of full risk to providers in MA.

News Briefs: Medicare Advantage-related Marketing Complaints to CMS More Than Doubled From 2020 to 2021

The number of Medicare Advantage marketing-related complaints submitted to CMS more than doubled between 2020 and 2021, according to a recent report from Axios. Referencing CMS data, the news outlet reported that CMS received approximately 39,600 complaints about the marketing of MA and Part D plans in 2021, compared with about 15,500 in 2020 and an average of 6,000 to 7,000 in prior years. Consumers complained about things like being enrolled without contact from a health plan and misleading information about provider networks. Senate Finance Committee Chair Ron Ryden (D-Ore.) last month wrote to 15 states asking for detailed information about such complaints, while CMS has taken steps to tighten oversight of third-party marketing organizations. “While actions to reign in marketing constructs could affect competitive dynamics within MA, we should continue to see robust growth in this end market in totality, with an emphasis on consumer choice, branding, and benefit constructs affecting the competitive landscape moving forward,” observed Citi Research analyst Jason Cassorla.

Medicare Advantage Plans Face Stiff Test in Twin-Power Dialysis Market

Overwhelming consolidation in the dialysis provider market, dominated nationally by two organizations, may have a chilling effect on the financial health of some Medicare Advantage plans, which hold limited negotiating power barring regulatory reform, says a new study.

Since the 21st Century Cures Act loosened enrollment rules in 2021, allowing more patients with a previous diagnosis of end-stage renal disease (ESRD) to join Medicare Advantage, plans have witnessed a significant shift. More than 40,000 fee-for-service (FFS) Medicare members with ESRD switched to an MA plan during the first Annual Election Period under the new policy, according to the consultancy Avalere.

Medicare Advantage Plans Pay Higher Prices Than CMS for Dialysis Care

A new study published in Health Affairs urged government leaders to limit market consolidation among the largest dialysis providers as more and more seniors choose Medicare Advantage over fee-for-service (FFS) Medicare. Analyzing 2016 and 2017 outpatient Medicare claims data, the study authors found that MA organizations paid inflated costs for dialysis services compared to what FFS Medicare would have paid, especially to large national dialysis organizations — where the majority of patients receive treatment. Notably, MA plans’ median cost for in-network hemodialysis (the most common form of the therapy) was $301, which was markedly higher than the $232 median cost for out-of-network treatments. Findings were similar for peritoneal dialysis, the less common form of dialysis.

On SCOTUS Refusal to Review UHC Case, MAOs Must Tighten Chart Review and Coding Practices

Amid mounting attention to Medicare Advantage organizations’ risk adjustment and prior authorization practices — which were the subjects of intense discussion during a recent House Energy & Commerce Committee hearing — the U.S. Supreme Court last month declined to take up a case brought by UnitedHealthcare (UHC) challenging CMS’s 2014 Overpayment Rule. Industry experts tell AIS Health, a division of MMIT, that this decision means CMS can begin enforcing its rule and may soon finalize its long-awaited extrapolation methodology for conducting Risk Adjustment Data Validation (RADV) audits.

“I think given the makeup of the court, on the one hand it was a bit surprising that they declined to take the case and that the denial of cert was issued without a comment. But on the other hand, given the general political landscape and issues that the court is considering, this is fundamentally an issue of administrative law and they’ve considered some other administrative law cases this term and I can understand why they decided not to take this case,” remarks Lindsey Brown Fetzer, member with Bass Berry & Sims and chair of the firm’s managed care practice.

News Briefs: Centene Settles New Mexico Medicaid Pharmacy Investigation for $13.7 Million

In the latest settlement with a state Medicaid program over its pharmacy benefit practices, Centene Corp. has agreed to pay $13.7 million to the state of New Mexico. Upon referral from the Office of the State Auditor in collaboration with the New Mexico Health Services Dept. — which oversees the Centennial Care Medicaid program — Attorney General Hector Balderas (D) conducted an investigation focused on “concerns that Centene was layering fees and not passing on retail discounts” to the program, according to a June 13 press release from the AG’s office. Centene has spent millions to settle claims by state Medicaid programs that it overcharged them for prescription drugs and is in the process of restructuring its pharmacy benefit management platform.

Trustees Report Underscores Need for Wholesale Medicare Reform

While the headline takeaway from the latest Medicare Trustees report was that the Hospital Insurance (HI) trust fund will be exhausted two years later than previously projected, industry experts suggest that the report should light a fire under Congress to take swift legislative action to sustain Medicare financing. During a recent webinar hosted by the Bipartisan Policy Center, a panel of seasoned policy experts agreed that the report underscored the need for comprehensive structural reform to the Medicare program, including potential changes to the way Medicare Advantage plans are paid.

Published on June 2, the Medicare Board of Trustees’ annual report provides previous and projected costs for the Medicare program’s two separate trust funds: the Hospital Insurance trust fund (HI), which helps pay for inpatient hospital and other services covered by Medicare Part A; and the Supplemental Medicare Insurance trust fund (SMI), which helps pay for physician, outpatient hospital, home health and other services covered by Parts B and D.

Plan Finder Update Leaves Out Detail on Supplemental Benefits

As CMS continues to seek ways to improve its consumer-facing tools for comparing Medicare coverage options, the agency last month unveiled a series of tweaks to the Medicare.gov website and Medicare Plan Finder (MPF). The MPF in 2019 underwent a major makeover that reportedly cost the Trump administration $11 million but critics say fell short of fixing many of the issues highlighted in a July 2019 report from the Government Accountability Office. CMS has continued to make updates based on consumer feedback, but some industry experts suggest more detail around the supplemental benefits offered by Medicare Advantage plans would be useful.

“CMS is making Medicare.gov easier to use and more helpful for people seeking to understand their Medicare coverage, which is an essential part of staying healthy,” said CMS Administrator Chiquita Brooks-LaSure in a May 18 press release. “We are committed to listening to the people we serve as we design and deliver new, personalized online resources and expanded customer support options for people with Medicare coverage and those who support them.”