Reimbursement

No News Is Bad News for MAOs Hoping to See Pay Hike in 2025

The April 1 release of final rate projections for Medicare Advantage and Part D plans was largely uneventful as CMS maintained the same all-in estimate of what plans can expect to see, on average, in terms of a reimbursement update next year. But the market did not respond well: MA-exposed insurers’ shares took a tumble and equity analysts warned that a revenue decline — before coding trend — could lead to benefit cuts and footprint reductions.

Industry trade groups did not respond favorably, either. In a statement released immediately after the rate announcement, AHIP President and CEO Mike Tuffin said the finalized policies would “put even more pressure on the benefits and premiums of 33 million Medicare Advantage beneficiaries who will be renewing their coverage this fall,” particularly as the MA and Part D programs face regulatory and legislative changes.

0 Comments
© 2024 MMIT

Coding Intensity, Favorable Selection Fuel MedPAC’s Push for MA Pay Reform

In its latest report to Congress, the Medicare Payment Advisory Commission (MedPAC) asserted that the federal government now pays approximately 22% more for Medicare Advantage enrollees than it would if they were enrolled in traditional fee-for-service (FFS) Medicare, for projected higher spending of $83 billion in 2024. That figure came in slightly below projections provided at a January meeting but higher than MedPAC’s previously estimated differences in spending, largely because it accounted for favorable selection. And while the commission said it “strongly supports the inclusion of private plans in the Medicare program,” it maintains that the current payment system is ripe for reform.

According to MedPAC’s latest Report to the Congress: Medicare Payment Policy, released March 15, the federal government in 2023 paid MA plans roughly $455 billion for serving approximately 31.6 million enrollees — 52% of Medicare beneficiaries with both Parts A and B coverage.

0 Comments
© 2024 MMIT

COA: New Part D Reimbursement Is Not ‘Reasonable and Relevant’

Specialty pharmacies and oncology practices dispensing costly specialty medications have long complained that Medicare Part D direct and indirect remuneration (DIR) fees are not appropriate for these drugs. Efforts to do away with these retroactive fees were finally successful, but revamped reimbursement has brought a new problem — underwater reimbursement — claims the Community Oncology Alliance (COA).

DIR includes rebates and price concessions that occur after the point of sale. According to CMS, total DIR “has been growing significantly in recent years.…In 2020, pharmacy price concessions accounted for about 4.8 percent of total Part D gross drug costs ($9.5 billion), up from 0.01 percent ($8.9 million) in 2010.”

0 Comments
© 2024 MMIT

UnitedHealth Sets Dates for Restoring Change Healthcare Systems

UnitedHealth Group faces a crisis as the fallout from the hack of its Change Healthcare subsidiary continues to spread. The firm is rumored to have paid $22 million to the hackers who may have caused the breach, even as it faces falling stock prices, federal actions to stabilize provider reimbursement, payer operations disrupted by the hack, and legal risk.

A civil suit has already been filed against UnitedHealth due to the cyberattack, and the scale of the disruption may strengthen enforcement action resulting from a newly revealed federal antitrust investigation into UnitedHealth. Because of the cyberattack, payments to thousands of providers have stalled, causing a liquidity crisis for some practices. The hack also may have exposed thousands of other health care entities to data breaches. UnitedHealth’s stock price dropped from $521.97 on Feb. 21 (the day the breach was disclosed) to $478.78 at the close of business on March 7.

0 Comments
© 2024 MMIT

At Investment Conferences, Insurer Execs Discuss Cyberattack, Care Utilization

Speaking at two health care investment conferences on March 5, executives at three major health insurance companies noted that they had been affected by the ongoing cyberattack on Change Healthcare, the nation’s leading processor of medical claims. However, they noted that it is still too early to assess how the Change attack will affect their first-quarter results.

The companies — CVS Health Corp., Elevance Health, Inc. and Humana Inc. — each reaffirmed their financial guidance for the year while addressing investors. They admitted, though, that they do not have as much information on claims and utilization as usual due to the Change outage that was discovered on Feb. 21.

0 Comments
© 2024 MMIT

Change Healthcare Cyberattack Is ‘Wake-Up Call’ for Vulnerable Industry

Change Healthcare is the target of an ongoing cyberattack that is causing significant disruption for providers and pharmacists that rely on the UnitedHealth Group subsidiary to process claims, payments and authorizations.

While two prominent credit-rating firms say the incident likely won’t affect the credit worthiness or earnings outlook of UnitedHealth’s overall enterprise, one industry expert says the Change cyberattack does still pose risks for the company — and puts similarly diversified health insurers on notice.

“There’s just no guarantee that anybody’s going to be entirely safe from cyberattacks,” says Dean Ungar, a vice president and senior analyst at Moody’s Investors Service. “I think this does serve as a wake-up call or reminder to everyone in the industry…Even those [firms] that weren’t hit probably took this opportunity to take another look at what they’re doing and make sure that they’re protected — to the extent that you can be.”

0 Comments
© 2024 MMIT

Elevance’s $14.8 Billion Suit Against Express Scripts Reaches Appeals Phase

Part of a long-running lawsuit filed by Elevance Health, Inc. against The Cigna Group, over what Elevance considers inappropriate contract practices by Cigna's Express Scripts PBM, entered mediation mandated by the Second Circuit Court of Appeals, according to court documents and Elevance’s latest 10-K filing with the Securities and Exchange Commission (SEC). Elevance was seeking to recover $14.8 billion in damages and is now appealing a district court judge’s dismissal of its remaining claim.

David Kaufman, an attorney at Laurus Law Group LLC, says that the mediation mandated by the Second Circuit is unlikely to do much to satisfy Elevance.

0 Comments
© 2024 MMIT

Panelists: CMS Prior Authorization Rule Should Help, But More Is Needed

The rule that CMS finalized last month regarding prior authorization (PA) should help streamline the increasingly scrutinized process and lead to faster decisions, according to panelists who spoke during a KFF webinar on Feb. 22. However, they noted that regulation did not apply to employer-sponsored plans or state-based exchange plans and did not address how PA decisions are made and the clinical criteria plans use in determining which procedures are subject to PA.

Troyen Brennan, M.D., former chief medical officer at CVS Health Corp. and Aetna, noted that the rule did not include prescription medications, which are often subject to PA — a process that draws the ire of providers who worry that delays could worsen patient outcomes. The CMS Interoperability and Prior Authorization Final Rule also required insurers to have a PA application programming interface (API), where providers can access information, although the regulation did not require them to disclose PA data on medications.

0 Comments
© 2024 MMIT

Surprise Billing Disputes Far Outpace Federal Projection

The federal government received 13 times more surprise billing disputes in the first half of 2023 than it initially estimated to receive over the course of a full calendar year, according to new CMS data.

The No Surprises Act (NSA), passed in 2021, established a Federal Independent Dispute Resolution (IDR) process that out-of-network providers and insurers can use to determine the OON rate for qualified IDR items or services after an unsuccessful open negotiation period. That process replaces the pre-NSA status quo of an OON provider sending a surprise bill to a patient. Of the 288,810 disputes filed through the Federal IDR portal over the first six months of 2023, about 46% were closed, with providers winning 77% of payment determinations.

0 Comments
© 2024 MMIT

Reports Show Network Participation Increased With Surprise Billing Ban

A vocal contingent of providers has argued that the No Surprises Act (NSA), the 2020 law that banned surprise medical billing in most cases, has limited their ability to get fair in-network rates from insurers, disincentivizing network participation. However, experts say that this complaint misses the point of the reform — and recent data indicate that the opposite of what providers argue may be true.

The NSA stipulates that when a patient is being treated by an out-of-network provider without having agreed to it first — which often happens in emergency rooms — the provider can only charge the patient their maximum in-network cost sharing amount. If there is an outstanding balance after the patient is billed that amount, the provider has two options for payment: The provider can either accept the median in-network rate for the care in question, or submit the disputed bill to a binding arbitration process called Independent Dispute Resolution (IDR).

0 Comments
© 2024 MMIT