Managed Medicaid

Marketplace, MCOs Will Face a Rocky Transition When PHE Ends

When the Biden administration ends the COVID-19 public health emergency (PHE), states will disenroll millions of Medicaid beneficiaries — and insurers will have to take Medicaid MCO members off their books. Experts tell AIS Health, a division of MMIT, that carriers can take steps to retain some of those members by helping them enroll in Affordable Care Act (ACA) marketplace coverage — but say the number of people who make the switch will be far lower than the number of people who joined the Medicaid rolls during the pandemic (see infographic).

Medicaid and individual exchange enrollment have both boomed with the higher federal funding that was included in the American Rescue Plan Act (ARPA) — and both segments’ total enrollment and enrollee profiles will change significantly when that extra funding ends.

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PHE Unwinding Delay Gives States, MCOs Time to Ease Transitions

With radio silence from HHS on May 16 — when states at the very latest had expected to hear whether the COVID-19 public health emergency would end in July — HHS at press time appeared to be gearing up for another extension of the PHE. This will give states, insurers and other stakeholders more time to prepare for the inevitable resumption of Medicaid eligibility redeterminations, which could cause millions of adults and children to lose health insurance coverage.

The PHE has been extended multiple times since the start of the pandemic and remains a moving target. As a condition of receiving enhanced federal funds during the PHE, states have been required to ensure continuous Medicaid and CHIP coverage for most enrollees by pausing eligibility redeterminations. And the Biden administration has promised to provide states 60 days’ notice before any possible termination or expiration. But without such notification, sources estimate the next end date could be Oct. 13. Bloomberg on May 16 reported that the PHE would be extended past mid-July, “according to a person familiar with the matter.”

Medicaid Rolls Soar to Nearly 89 Million Beneficiaries as Redeterminations Loom

Nationwide Medicaid enrollment has grown more than 22% since the outset of the COVID-19 pandemic, topping 88.7 million lives, according to the latest update to AIS’s Directory of Health Plans. But the end of the Public Health Emergency (PHE) — which at press time was likely to be extended beyond mid-July — could leave between 5.3 million and 14.2 million people without coverage when redeterminations resume, asserted a May 10 analysis from the Kaiser Family Foundation. A separate study from the Georgetown University Heath Policy Institute found that 6.7 million children stand to lose CHIP coverage at the end of the PHE. See a state-by-state overview of three years of pandemic-fueled Medicaid enrollment changes in the chart below.

News Briefs: Second WCAS-Humana Joint Venture Will Deploy $1.2 Billion for Primary Care Clinics

Humana Inc. on May 16 said it had established a second joint venture with Welsh, Carson, Anderson & Stowe (WCAS) to further expand its value-based primary care clinics. (Hg Capital Partners and WCAS share control of MMIT, the parent of AIS Health.) The new JV will provide up to $1.2 billion of additional capital for the development of approximately 100 new CenterWell Senior Primary Care Clinics between 2023 and 2025, said Humana. The expansion follows an earlier JV that is currently deploying up to $800 million of capital to open 67 clinics by early 2023 and support their ongoing operations, added the insurer. WCAS will have majority ownership of the JV, while Humana will own a minority stake.

Medicaid Plans Get Ready for Yearlong Postpartum Care

State Medicaid programs now have the option of applying to CMS to expand postpartum coverage for parents who have just given birth to 12 months, up from the default 60 days of coverage. Medicaid MCOs in states that have opted into the expanded coverage tell AIS Health, a division of MMIT, that they are taking steps to get ready for the new coverage and anticipate better outcomes for both new parents and new children as a result of the program.

Maternal mortality rates in the United States are disturbingly high compared to other developed countries — in 2018, 17 women per 100,000 live births died, compared to three in the Netherlands, Norway and New Zealand, per the Commonwealth Fund — and the U.S. is the only developed country to see that rate increase in recent years. Most of those deaths were preventable.

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Study: 25% of Medicaid Docs Provide At Least 75% of Care

About a quarter of the practitioners in Medicaid managed care organization networks provide more than three-quarters of the services used by members, according to an article published by researchers affiliated with Yale and Cornell Universities in the journal Health Affairs this month. Experts say that this concentration of care likely limits access to care for members, and health plans need to do more to make sure their networks aren’t made up of so-called “ghost providers.”

The article, which analyzed claims and enrollment data from Kansas, Louisiana, Michigan and Tennessee during 2015-17, found that care delivery is highly concentrated in both primary care and specialists. However, the authors caution that their study of the states “might not generalize nationally” and only studied four specialties.

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Centene Plans to Sell Magellan Rx, PANTHERx Rare for $2.8 Billion

Centene Corp. has agreed to sell two of its pharmacy businesses, Magellan Rx and PANTHERx Rare, in separate transactions as part of the insurer’s decision last year to exit the PBM industry.

Prime Therapeutics, a PBM jointly owned by 19 Blue Cross and Blue Shield affiliates, is acquiring Magellan Rx for about $1.35 billion in a deal that’s expected to close in the fourth quarter, while a joint venture of the Vistria Group, General Atlantic and Nautic Partners is buying PANTHERx Rare for $1.45 billion in a deal that’s expected to be completed in the next two to four months.

PHE Extension, Medicare AEP Boost ’22 Earnings Projections

Better-than-expected first-quarter 2022 earnings aided by Medicare open enrollment successes and the extension of the public health emergency (PHE) drove several insurers at press time to raise their earnings guidance for the year. Some, however, approached their projections with caution as variant-driven surges in the COVID-19 pandemic continue to create uncertainty around utilization.

Reporting first-quarter earnings on April 27, Humana Inc. said its results from the latest Medicare Annual Election Period (AEP) were slightly better than projected and it is making progress on a $1 billion value creation plan unveiled last quarter that will allow the company to further enhance its Medicare offerings. For the AEP that ended Dec. 7, improvements were “driven by higher sales and improved voluntary termination rates,” explained President and CEO Bruce Broussard during an April 27 conference call to discuss recent quarterly earnings. Broussard also provided a detailed update on Humana’s efforts to improve the sales experience through its various distribution channels.

News Briefs: New CMS Report Finds Non-White Medicare Advantage Enrollees Continue to Receive Worse Care

A new report looking at disparities in care for Medicare Advantage beneficiaries by race, ethnicity and sex found that non-white MA enrollees generally received worse care in 2020 than their white counterparts. Racial and ethnic differences were more glaring for clinical care measures than for patient experience measures, with scores for Black MA enrollees falling below the national average for 14 out of 36 clinical care measures, according to the April report, which was prepared by The RAND Corp. for the CMS Office of Minority Health. Researchers relied on Consumer Assessment of Healthcare Providers and Systems (CAHPS) data collected from March to May 2021 and the Healthcare Effectiveness Data and Information Set reflecting care received from January to December 2020. White enrollees reported care that was in line with the national average on all patient experience measures from the CAHPS survey, while their scores were similar to the national average on 31 clinical care measures and above average on five measures. Scores for American Indian and Alaska Native MA enrollees were also below the national average on 14 clinical care measures, and scores for Hispanic MA beneficiaries were worse than average on 11 such measures.

Centene CEO London Addresses Issues With Medi-Cal Rx Launch

Sarah London, Centene Corp.’s new CEO, acknowledged during the insurer’s April 26 first-quarter earnings call that “there were challenges out of the gate” when the company’s Magellan Health unit took over California’s Medi-Cal Rx program in January. But, she added, “I think the team recovered incredibly well.”

London’s comments came after the California Department of Health Care Services (DHCS) said it is investigating Centene’s PBM practices following a California Healthline article earlier this month that detailed numerous issues with the launch. A DHCS spokesperson confirmed the investigation via email to AIS Health, a division of MMIT, but would not elaborate on details.

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