Reimbursement

Study Could Help Policymakers Set Fair Reimbursement Rate for Ground Ambulances

Ground ambulance services are exempt from the federal ban on balance billing, also known as surprise billing, and a new study published in the journal Health Affairs found that privately owned ambulances are more likely to balance bill than their public sector counterparts. The study’s findings will doubtless be considered by a new federal panel convened to recommend solutions to the complexities of ground ambulance balance billing, which could shape potential legislation to fix the problem in the current Congress — legislation that could find the federal government setting rates for ambulance reimbursement.

A key reason that ground ambulance services were not included in the No Surprises Act (NSA) — the 2020 law that bans medical balance billing — is the ownership structure of ambulance services. About 60% of ground ambulance providers are funded by local governments as part of their fire departments or as a quasi-utility, according to Loren Adler, a coauthor of the study and an economist and associate director of the USC-Brookings Schaeffer Initiative for Health Policy. That arrangement is somewhat unique in the U.S. health care system.

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New Blues-Owned Drug Contracting Org Wants to Work With, Not Against Providers, CEO Says

A new venture founded by Blue Cross and Blue Shield affiliates, called the Synergie Medication Collective, aims to improve affordability and access to drugs covered under the medical benefit — a category that includes cancer medications and cell/gene therapies. Synergie’s chief executive says the goal isn’t to disrupt the current distribution system for clinically administered drugs, but rather to leverage the Blues’ size and bargaining power to scale up innovations like outcomes-based contracting for some of the country’s priciest drugs.

“We’re basically a medical contracting organization,” Synergie CEO Jerrod Henshaw tells AIS Health, a division of MMIT. “And by that, I mean we’re not going to be buying and billing like a Vizient or a HealthTrust and displacing any of that. We’re not going to be in the distribution channel.”

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Medicaid Plans Aren’t Properly Reporting MLR Data, OIG Finds

Many of the medical loss ratio (MLR) reports that Medicaid managed care organizations are submitting to states are incomplete, and much of that missing data concerns how much MCOs are spending on administrative services, according to a new report from the HHS Office of Inspector General (OIG).

The report, published in September, is part of a “body of work” that the watchdog agency initiated a few years ago that focuses on the implementation of the federal MLR requirements for Medicaid managed care ushered in via the 2016 update to MCO regulations, the HHS-OIG Office of Evaluation and Inspections tells AIS Health via email. The new report builds upon a data brief issued in August 2021 that “served as a first-of-its-kind nationwide landscape of Medicaid managed care MLRs,” and found that most states established a minimum MLR of 85% for their contracted MCOs. That means plans must spend at least 85% of their premium revenue on covered health care services and quality improvement activities.

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FDA Committee Backs ALS Drug as ICER Questions Projected Cost

By a seven to two margin, an FDA advisory committee on Sept. 7 voted that there was enough evidence to support the approval of AMX0035, an oral medication that Amylyx Pharmaceuticals, Inc. is developing for amyotrophic lateral sclerosis (ALS). The vote represented a reversal for the FDA’s Peripheral and Central Nervous System Drugs Advisory Committee (PCNSDAC), which on March 30 had recommended against the medication’s approval.

Despite the committee's decision, David Rind, M.D., chief medical officer of the nonprofit Institute for Clinical and Economic Review (ICER), tells AIS Health that Amylyx may have trouble getting the drug covered due to the medication’s likely high cost and lack of clear effectiveness.

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CMS Unveils New Oncology Care Model to Mixed Stakeholder Responses

Only days before the end of CMS’s Oncology Care Model (OCM), the agency unveiled a successor that will start next year. While oncologists have been overall positive about the new program, they still have had some complaints.

Offered through the Center for Medicare and Medicaid Innovation (CMMI), the Enhancing Oncology Model (EOM) is a five-year, value-based, patient-centered care model that will start on July 1, 2023. Participants may include oncology physician group practices, private payers, Medicare Advantage plans and state Medicaid agencies. The application submission period started when the voluntary model was introduced on June 27 and will close Sept. 30.

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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.

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CMS Fines 2 Georgia Hospitals for Non-Compliance with Price Transparency Rule

In the first enforcement action since CMS’s Hospital Price Transparency rule went into effect at the start of last year, the agency on June 7 fined two hospitals in Georgia a total of more than $1 million for non-compliance with price transparency requirements. Health policy experts tell AIS Health, a division of MMIT, that they hope CMS ramps up its enforcement efforts, which could help payers, patients, employers and other stakeholders benefit from price comparison and greater competition.

CMS levied an $883,180 penalty against Northside Hospital in Atlanta and a $214,320 fine against Northside Hospital in the Atlanta suburb of Canton, Ga. The penalties were announced the same week that a research letter published in JAMA revealed that only 5.7% of hospitals had complied with the federal transparency rule between six and nine months after the legislation was enacted on Jan. 1, 2021 — the latest in a series of studies drawing similar conclusions.

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MedPAC Mulls Method of Reducing High-Cost Outlier Impact on Risk Scores

After its last two reports suggested comprehensive reforms to Medicare Advantage plan reimbursement, the Medicare Payment Advisory Commission (MedPAC) in its June report to Congress shifted its MA focus to one area in particular: the potential for high-cost patient outlier data to skew the calculation of risk scores that determine MA plans’ risk-adjusted pay.

Although the Hierarchical Condition Category (HCC) risk adjustment model is intended to produce scores that reflect the relative health status of a plan’s enrollees, fee-for-service (FFS) Medicare spending data that is used to calculate risk scores can include a small group of outliers whose annual costs are much higher than the average costs of patients with a given condition, explained MedPAC Executive Director Jim Mathews during a June 15 web briefing with members of the press.

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Health Insurers, Hospitals Grapple With Inflation, Labor Costs

While inflation hits consumers at car dealerships, airline counters and grocery stores, health insurers and hospitals also are seeing inflationary pressure, particularly with the so-called Great Resignation underway and labor costs skyrocketing.

The Labor Department reported on May 11 that the Consumer Price Index rose 8.3% over the 12-month period that ended in April 2022, down only slightly from the four-decade high of 8.5% reported in March.

“There’s no question that the labor market is tight. So, as you think about inflation, we hear it certainly from our provider partners, and we see it in certain parts of our own business,” Anthem, Inc. CEO Gail Boudreaux told investors during an April 20 conference call to discuss first-quarter 2022 financial results, per The Motley Fool.

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Insurers Are Helping Patients, Providers Deal With Medical Debt

Although fewer Americans are dealing with medical-related financial hardships since the coronavirus pandemic began, the percentage is still high and could rise further as Medicaid redeterminations resume, major Affordable Care Act subsidy expansions expire and inflation eats away at people’s incomes and savings. To that end, payers are implementing ways to ease the burden of high out-of-pocket costs for patients and to help providers improve their collections, even as one expert calls the services a “Band-Aid attempt to cover the widening healthcare affordability gap.”

An Urban Institute report published on May 11 found that 16.8% of adults from 18 to 64 years old had medical debt in April 2021, down from 23.6% in March 2019. The Urban Institute cited several potential reasons for the decline, including a reduction in health care utilization, pandemic relief measures and growth in Medicaid enrollment.

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