Reimbursement

Regulators on Sept. 20 released the latest in many iterations of rulemaking related to the No Surprises Act (NSA), the 2021 law that banned surprise medical billing. Meanwhile, one expert tells AIS Health, a division of MMIT, that evidence is growing that insurers have gained a notable advantage in rate negotiations with emergency departments.

The new proposed rule deals with fees related to Independent Dispute Resolution (IDR), the arbitration system set up by the NSA. Previous rulemaking, which was challenged in court by provider groups, required each party to pay $350 per case when they submit a batch of cases to an IDR entity. The new proposed rule requires each party to pay $150 per case, according to Manatt, Phelps & Phillips LLP partner Harvey Rochman.

The House is reportedly poised to vote soon on legislation that consolidates a host of previously introduced health care measures — including a step toward site-neutral payment reform. Aimed at stopping “price gouging” by hospital outpatient departments (HOPDs), those provisions are enthusiastically supported by payers but opposed by the hospital industry, which argues that they would result in payment reductions.

The legislation also would codify existing regulations that lay out new price transparency requirements for health plans and hospitals, and it would implement modest PBM reforms.

Self-insured plans pay higher prices for many health care services compared with fully insured plans, according to an analysis of claims data published in this month’s issue of Health Affairs. Aditi P. Sen, Ph.D., the study’s lead author, says the findings “suggest that employers are generally not able to negotiate prices on behalf of their employees, and I don’t think that should be surprising. It really reflects the dynamics in health care markets.”

In self-insured plans, employers assume financial responsibility for their workers’ health care claims rather than having a health insurer take on that risk — theoretically giving such companies more incentive to drive costs down.

Provider groups that want to sponsor a Medicare Advantage plan have multiple avenues of entering the market and competing with large national players — including building a plan from scratch. But funding, state licensure and other regulatory requirements are key considerations before taking the leap, according to experts who spoke during a recent webinar hosted by Manatt Health.

“There are a lot of players in the market, and a lot of providers are trying to figure out if this is a good strategy for them,” said Paul Carr-Rollitt, partner with Manatt Health, during the July 20 webinar, Creating Provider-Sponsored Medicare Advantage Plans: Opportunities, Risks and Keys to Success.

As the MA market expands, there is increasing interest among provider-based groups — from hospitals, health systems and physician associations — to make an entrance. While the market is currently “dominated by a few key players” and considered “highly concentrated,” that doesn’t mean provider-sponsored groups that are intrigued by the idea must be forced to the sidelines, Carr-Rollitt said.

In its annual release of the Medicare Part D bid information for the coming plan year, CMS on July 31 projected that the average total monthly Part D premium will decrease from $56.49 in 2023 to $55.50 in 2024, thanks in large part to the basic part of the premium being held down by a stabilization provision in the Inflation Reduction Act (IRA). But unlike previous years, where the national average monthly bid amount (i.e., the weighted average of the estimated cost to Part D plan sponsors of providing their benefit package) steadily dropped, CMS reported that the bid amount will rise from $34.71 for 2023 to $64.28 in 2024. That’s largely because of IRA-mandated changes and CMS’s recent rulemaking on pharmacy price concessions.

Starting in 2024, the IRA limits the annual increase in the base beneficiary premium to no more than 6%. The base beneficiary premium, which is the starting point for calculating a plan-specific basic Part D premium, is projected to rise by 5.9% to $34.70 in 2024.

Two health care sector heavyweights— AHIP, the insurance trade group, and the American Medical Association (AMA), a physician group — are teaming up on an effort to boost value-based care by increasing data sharing. A health care industry insider says that the tentative partnership between two longtime adversaries is just the latest indication that, due to plan sponsor pressure on carriers and providers, value-based care could become the industry standard in independent physician practices and primary care.

AHIP, AMA and an additional partner, the National Association of Accountable Care Organizations (NAACOS), on July 25 rolled out a “playbook” for providers and insurers seeking to adopt value-based reimbursement or become partners in an accountable care organization (ACO). The document, which the three groups say is just the first of several such releases, focuses on how providers and plans can effectively share both individual medical and population data.

A lawsuit filed July 24 in a California district court accuses Cigna Healthcare of violating a state law requiring insurers to give each claim a “thorough, fair and objective investigation.” The proposed class-action suit filed on behalf of two Cigna enrollees claims that the insurer uses the system PxDx to deny claims in bulk rather than examine them individually. It cites a ProPublica article published in March that found Cigna doctors denied over 300,000 requests for payment using PxDx over a two-month period in 2022, spending an average of just 1.2 seconds reviewing each request. Cigna, however, hit back in a press release issued July 27 “in response to recent media representations.” The insurer says that PxDx is “a simple process that has successfully helped accelerate payments to physicians for common, relatively low-cost tests and treatments over the last several years,” adding that patients “are not denied care through this review in any way — it occurs after the patient has received treatment and once their physician bills for the treatment.” What’s more, the “vast majority” of claims reviewed through the PxDx process are automatically paid, the firm said, adding that CMS and other health insurers use a similar process.

North Carolina and Colorado recently became the latest in a string of states that have taken over the reins of Friday Health Plans Management Services Company, Inc.’s subsidiaries in a bid to ensure consumers and providers aren’t harmed by the insurer’s implosion. The company’s downfall has implications for health insurers, too, as they may not receive the risk-adjustment funds they’re expecting if Friday can’t pay its share, an industry expert previously told AIS Health.

Insurance Commissioner Mike Causey said June 20 that Friday Health Plans of North Carolina Inc. “consented to being placed into receivership to protect North Carolina policyholders due to its reported insolvency and inability to raise additional funds from outside investors.” Technically, the action is not yet completed, as the state said it filed its receivership petition with the Wake County Superior Court and will post the order on the North Carolina Dept. of Insurance's website once it is signed.

Optum Rx, the PBM owned by UnitedHealth Group, recently launched new programs that will reimburse community pharmacies for helping vulnerable and underserved patients access critical health care services. The move comes as major PBMs like Optum Rx are facing ever-increasing scrutiny for their business practices — including from rural and independent pharmacies that contend big PBMs are driving them out of business.

A trade group for community pharmacists and a health policy expert both say that the programs have promise, although they also say it’s unclear how big of an impact Optum Rx’s initiatives will ultimately make.

Walgreen Co. filed a lawsuit last month asking a judge to overturn a $642 million arbitration judgment awarded to Humana Inc. pertaining to a dispute over drug pricing. The pharmacy giant alleged that it was seeking the reversal in part because a law firm that used to represent Walgreens allegedly switched sides and encouraged Humana to seek the arbitration. “This arbitration began in betrayal and ended in a miscarriage of justice,” Walgreens’ filing claimed.

The case highlights a common disagreement between payers and pharmacies over reimbursement, although it is unusual to see a company blame a law firm for sparking such a clash, according to a lawyer and pharmacist who spoke with AIS Health, a division of MMIT.