After partnering with fledgling primary care startup Herself Health in January 2023, Blue Cross and Blue Shield of Minnesota recently announced a new contract structure that will incentivize the provider to drive “results-driven health solutions” for the Blues plan’s female Medicare Advantage population. Retroactive to Jan. 1, 2024, the partners have entered a value-based agreement that will include specific, measurable quality targets aimed at improving overall health outcomes for women.

Co-founded in 2022 by Kristen Helton, who previously led Amazon’s now-shuttered Amazon Care service for employees, Herself Health is a value-based health care technology company focused on delivering advanced primary care to women ages 65 and older. Since securing $7 million in seed round funding led by investment firm and founding partner Juxtapose, Herself Health has opened four clinics in the Twin Cities and is preparing to launch a fifth clinic in nearby Eagan, Minnesota.

CMS’s Medicare Advantage Value-Based Insurance Design (MA VBID) model — which offers MA organizations enhanced flexibility to tailor a variety of interventions to address health-related social needs — has gone through multiple iterations since its inception. In what CMS officials consider the third phase of its evolution, MA VBID participants will soon face new accountability for driving savings, addressing health equity and delivering meaningful supplemental benefits.

The MA VBID model, which was launched by the CMS Center for Medicare and Medicaid Innovation (CMMI) in 2017, has seen participation grow from nine MA organizations in three states to 69 MAOs serving an estimated 8.7 million VBID beneficiaries across the U.S. Having been extended through 2030, it is currently CMMI’s longest-running model and the only model specifically testing innovations in MA. Those innovations initially included offering supplemental benefits or reduced cost sharing to enrollees with certain chronic conditions or who participated in care management and/or disease management activities.

During presentations at recent investor conferences and meetings, three of the industry’s so-called “insurtechs” expressed a notable degree of confidence in their ability to profit from the Medicare Advantage space, even as their more diversified and established publicly traded peers struggle with increased utilization and diminishing reimbursement. That’s largely because of the investments they’ve made in proprietary technology that is driving care coordination.

In opening remarks at the company’s June 10 annual stockholder meeting, Clover Health Investments, Corp. CEO Andrew Toy touted year-over-year improvement in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) — the company recorded a profit for the first time — “all in the same year that the greater Medicare Advantage ecosystem took a step back.” Referring to its cloud-based, artificial intelligence-powered clinical support tool Clover Assistant, he told investors, “The fact that our entire clinical management model is driven by technology is something that we believe to be a significant moat for us and something that bodes well for our business as we move into a technology-centric, AI-accelerated world.”

As Medicare Advantage and Part D sponsors prepare their bids for 2025 amid revenue challenges, benefit cuts and other changes that plans are contemplating to maintain margins will undoubtedly trickle down to Accountable Care Organizations (ACOs) and other entities that take risk in MA. As a result, risk-bearing providers should be asking tough questions of their plan partners and conducting internal analyses to understand where their revenue stands to be impacted, according to value-based care experts.

From the transition to v28 — the new version of the Part C CMS-Hierarchical Condition Categories (HCC) model that will make it harder for plans and providers to apply more codes for risk adjustment — to increased inpatient utilization, a -0.16% drop in MA plans’ base pay and other changes, risk-bearing providers are bracing for a “perfect storm” of events in MA that will require preparation, said Zach Davis, a Wakely actuary who helps ACOs manage insurance risk, during a LinkedIn Live session recorded on April 24.

Payers and providers are increasingly adopting value-based care, although they need to continue to invest in the models and collaborate to make them work, according to a report released on April 10 by AHIP, the American Medical Association (AMA) and the National Association of Accountable Care Organizations (NAACOS). The 74-page report identified best practices for developing payment arrangements for value-based care, including establishing clearly defined contract terms and considering ways to incentivize payers and providers to participate and move away from fee-for-service arrangements.

“Our goal here — AMA, AHIP and NAACOS — is to identify these real world best practices, get those in the hands of health plans, of physicians and clinicians and the teams in general, the VBC entities, so that they can really absorb this information [and] take action based on it related to their own participation in these models, so that we can really scale this nationwide,” Danielle Lloyd, AHIP’s senior vice president of private market innovations and quality initiatives, said during an April 12 panel discussion at the NAACOS Spring 2024 conference in Baltimore.

Thanks to a final rule published just one year ago, Medicare Advantage plans as of Jan. 1 were expected to meet new constraints when it comes to applying their utilization management (UM) policies, including prior authorization. CMS has said it aims to assess UM-related performance of plans serving 88% of beneficiaries this year, and it intends to accomplish this through both routine program audits and “focused audits.” According to compliance experts, the volume of audit activity since CMS began sending engagement letters in late February suggests the agency is eager to meet its goal, but it may not like what it finds.

As Medicare Advantage organizations continue to face intense scrutiny — from the government’s latest probe into UnitedHealthcare to the Medicare Payment Advisory Commission calling attention to the cost of higher coding in MA — a new report underscores the power of whistleblower lawsuits in enforcing program requirements. Recent False Claims Act (FCA) settlements with the Dept. of Justice reflect a continued focus on MA insurers submitting inaccurate diagnosis information for the purposes of inflating reimbursement, and while the DOJ isn't involved in proposed class action lawsuits accusing major insurers of using artificial intelligence to wrongfully deny claims, such litigation “bears continued watching as it progresses.”

The U.S. Dept. of Justice (DOJ) has opened an antitrust investigation into UnitedHealth Group, according to an internal company document shared with AIS Health and a Wall Street Journal report citing unnamed people familiar with the matter.

Federal regulators are reportedly seeking information about how the Minnesota-based company’s UnitedHealthcare insurance arm interacts with the many provider acquisitions that its Optum division has made in recent years — and how that relationship affects competition.

One health care economist says that while many unanswered questions remain, the result of a different investigation into provider consolidation suggests that the DOJ’s probe of UnitedHealth could end in an antitrust lawsuit.

The Cigna Group may sell its Medicare Advantage business to Health Care Service Corp. for between $3 billion and $4 billion, according to the Wall Street Journal. After Cigna and Humana Inc. reportedly abandoned their rumored talks of combining, Bloomberg last month reported that HCSC and Elevance Health, Inc. were competing to buy Cigna’s MA segment. Sources close to the matter said Cigna is in “exclusive talks” with HCSC, which operates Blue Cross and Blue Shield plans in five states, the Wall Street Journal reported on Jan. 3.

After securing an amended credit agreement with JP Morgan, Bright Health Group, Inc. on Jan 1. finalized the previously announced sale of its Medicare Advantage assets to Molina Healthcare, Inc. The technology-driven startup on Dec. 29 said an amendment to its credit facility with JP Morgan would reduce the final repayment amount by roughly $30 million to approximately $298 million. With the close of the MA sale — which involves the California plans Brand New Day and Central Health Plan — the company has eliminated its secured debt and will use the remaining proceeds of the sale to “provide a solid foundation” for advancing its NeueHealth accountable care organization business, according to a Jan. 2 press release. Molina in December said it would buy the MA plans for approximately $425 million, down from the originally announced $510 million; analysts speculated the discount had to do with underperformance in Bright’s MA business due to heightened Medicare utilization trends in 2023.The deal nets Molina 121,863 MA members, boosting its membership by 115%, according to AIS’s Directory of Health Plans.

Across the U.S. in 2022, 24.5% of health care payments involved two-sided financial risk reimbursement arrangements, according to an analysis published on Oct. 30 from the Health Care Payment Learning & Action Network (HCPLAN). That is up from 19.6% in 2021 and 17.9% in 2020.

While the upward trend is encouraging for those interested in shifting away from a fee-for-service model, health policy experts tell AIS Health, a division of MMIT, that more needs to be done to encourage providers to embrace value-based care. They add that adoption varies based on the payer, with Medicare leading the way and private commercial plans lagging.