Reimbursement

New Surprise Billing Rule Seeks to Smooth Arbitration Process

The Biden administration on Oct. 27 released a new proposed rule governing the troubled balance billing arbitration process established as part of the No Surprises Act (NSA), the 2021 law that banned surprise medical billing. Professional and trade groups for providers, which have filed legal challenges to previous rulemaking governing the arbitration process — called Independent Dispute Resolution (IDR) — declined to say whether they would challenge the proposed rule if implemented in its current form, but at least one legal expert thinks that the rule has a good chance of lasting.

The NSA forced payers and providers to hold patients harmless, from a medical-billing perspective, when they inadvertently seek out-of-network care. Thus, the law set up the IDR process to resolve payment disputes that payers and providers are now responsible for settling themselves instead of balance-billing patients.

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Coverage, Supply Issues Dampen Promise of New RSV Immunizations

After years of having just one, limited option available to combat respiratory syncytial virus (RSV) in at-risk populations, the U.S. market this year has suddenly become rich with new products. Yet insurance coverage limitations and supply issues are frustrating efforts to keep elderly adults and very young babies from contracting what can be a life-threatening illness.

This May, the FDA approved both GSK’s Arexvy and Pfizer Inc.’s Abrysvo for people who are 60 and older, and in August, federal regulators approved Abrysvo for use in people who have been pregnant for 32 to 36 weeks, with the goal of protecting their infants after birth. Additionally, in July, the FDA approved Sanofi/AstraZeneca’s Beyfortus (nirsevimab-alip), a monocolonal antibody injection indicated for preventing RSV in newborns and infants born during or entering their first RSV season, and for children up to 24 months old who remain vulnerable to severe disease throughout their second RSV season.

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Despite Top-Level Decline, Tukey-Impacted Star Ratings Suggest Mostly Stable Performance

Only 42% of Medicare Advantage Prescription Drug (MA-PD) contracts that will be offered in 2024 achieved an overall rating of 4 stars or higher, compared with approximately 51% of contracts in 2023, according to the latest Medicare Part C and Part D Star Ratings data. Weighted by enrollment, the average MA-PD Star Rating fell from 4.14 for 2023 to 4.04, with approximately 74% of MA-PD enrollees estimated to be enrolled in contracts that achieved 4 or more stars for 2024, compared with 72% for 2023, CMS reported on Oct. 13.

Those changes were largely expected due to the application of the new Tukey outlier deletion methodology, which was used in determining the cut points for measures not directly related to member experience and largely achieved CMS’s stated goal of infusing more “predictability and stability” into the Star Ratings.

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News Briefs: Cigna Agrees to Pay $172.3M to Resolve False Claims Act Allegations

Resolving longstanding legal issues regarding its Medicare risk adjustment submissions, The Cigna Group has agreed to pay nearly $172.3 million and enter into a Corporate Integrity Agreement with the HHS Office of Inspector General. Cigna will pay approximately $135.3 million to resolve allegations stemming from an investigation based out of the Eastern District of Pennsylvania, according to a Sept. 30 press release from the U.S. Attorney’s Office. The insurer was accused of using a “chart review” program to identify and submit inaccurate diagnosis information in order to receive higher risk-adjusted payments from CMS while failing to delete or withdraw the “inaccurate or untruthful” diagnosis codes. The remaining $37 million will resolve allegations related to unsupported diagnoses for MA beneficiaries arising from Cigna’s home visit program. The allegations were brought in a whistleblower lawsuit transferred from the Southern District of New York, said the U.S. Attorney’s Office. Cigna in its own press release said the agreements “fully resolve” the False Claims Act lawsuit and investigation and will allow it to “maximize the company’s focus on delivering value to customers and taxpayers.” Cigna did not admit wrongdoing as part of the settlement.

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Pre-AEP Provider Pushback Offers ‘Reality Check’ for Medicare Advantage Plans

As the 2024 Annual Election Period approaches, Medicare Advantage insurers that began marketing on Oct. 1 have been touting service area expansions and/or the robust provider networks attached to their plans. But in the months and, in some cases, days leading up to the Oct. 15 start of open enrollment, some high-profile contract negotiations have played out in a very public way, with providers expressing their frustration with administrative delays, care denials and less-than-adequate rates. And the loss of key providers could have serious consequences from a network adequacy standpoint, even leading to an enrollment freeze if MA organizations are not careful, warns one compliance expert.

On top of concerns about overly burdensome prior authorization policies used by MA organizations, “providers are getting squeezed” from both sides, remarks Jane Scott, executive vice president of special projects for Rebellis Group. “Providers are getting squeezed on the fee-for-service, CMS side for their reduction in fee reimbursement. And then the health plans also want to reduce reimbursement for savings on their own part, while trying to stay competitive. And in doing that, they may have to reduce their service area size, their network offering, different things…and so that causes some market change.”

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Surprise Billing Ban Could Be Fueling ER Staffing Firms’ Financial Woes

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.

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House Inches Closer to Passing Hospital-Feared, Payer-Loved ‘Site-Neutral’ Reforms

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.

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Self-Insured Firms Struggle to Drive Hard Bargains With Health Care Providers

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.

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Opportunity Beckons for Provider Groups Seeking MA Plan Sponsorship

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.

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IRA Changes Will Drive Up Part D Bid in 2024, But Premiums Will Stabilize

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.

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