The federal agency will likely claim back billions of dollars in overpayments from health insurers that operate Medicare Advantage plans.
Payer organizations have expressed their disappointment for the Medicare Advantage Risk Adjustment Data Validation (RADV) final rule released by CMS, claiming the auditing standards will have the "potential unintended consequence" of harming beneficiaries.
The rule, which will allow the federal agency to collect billions of dollars in overpayments, eliminates the fee-for-service adjuster in RADV audits, a method to assess for a permissible level of payment errors.
However, the rule will only apply to audit findings beginning with the payment year 2018, rather than 2011 as previously proposed, absolving payers of significantly more in overpayments.
"CMS has a responsibility to recover overpayments across all of its programs, and improper payments made to Medicare Advantage plans are no exception," HHS secretary Xavier Becerra said in a statement. "For years, federal watchdogs and outside experts have identified the Medicare Advantage program as one of the top management and performance challenges facing HHS, and today we are taking long overdue steps to conduct audits and recoup funds."
Health insurer groups have bristled at the rule, insisting that it will raise costs for plan members and limit their access to care.
Matt Eyles, president and CEO of AHIP,stated: "Our view remains unchanged: This rule is unlawful and fatally flawed, and it should have been withdrawn instead of finalized. The rule will hurt seniors, reduce health equity, and discriminate against those who need care the most. Further, the rule would raise prices for seniors and taxpayers, reduce benefits for those who choose MA, and yield fewer plan options in the future."
Mary Beth Donahue, president and CEO of Better Medicare Alliance, a Medicare Advantage advocacy group, echoed the sentiment.
"While our review of the rule is ongoing, we are focused on the potential unintended consequence of creating an environment of higher premiums and fewer benefits for the more than 29 million seniors and people with disabilities who choose Medicare Advantage," Donahue said.
Meanwhile, David Merrit. Blue Cross Blue Shield Association senior vice president of policy and advocacy, stated: "CMS should have implemented a narrower solution aimed at a few bad actors, but instead this overreaching regulation will raise costs, reduce choice and make it more difficult for seniors and those with disabilities to effectively manage their health."
New research investigates the financial impact of reimbursing telehealth services at parity with in-person care.
Private health insurers were reimbursed similarly for telehealth and in-person visits in 2020, according to analysis from the Peterson- Kaiser Family Foundation Health System Tracker.
The research used data from the Health Care Cost Institute for the 2020 calendar year to examine the cost benefit to payers for reimbursing services provided through telehealth.
After looking at the average paid amount for evaluation and management claims and mental health therapy claims controlling for variation across providers, regions, and the severity of the claims, researchers found little difference between telehealth and in-person services.
"Telehealth use surged with the COVID-19 pandemic as patients sought access to services while providers implemented social distancing protocols," the researchers wrote. "Early in the pandemic, many payers eased restrictions on the use of telehealth and increased reimbursement rates to encourage its use."
For established patients at severity level one, payments were $34 for telehealth and $33 for in-person. At the highest severity level (five), the gap was $143 for telehealth and $137 for in-person.
For new patients, the difference in payments was also negligible—$61 for telehealth and $63 for in-person at severity level one, while severity level five was $273 and $267, respectively.
The trend held true for mental healthcare as well. The researchers found that 52% of mental health therapy claims for people with private plans were delivered over telehealth, with both the lowest (30 minutes of psychotherapy) and highest (psychiatric diagnostic evaluation with medical services) claims dead even in payments for telehealth and in-person.
Additionally, the analysis looked at how paid amounts varied within each provider. Among most of the providers offering the same service by telehealth and in-person, the average paid amount for claims delivered over telehealth was within plus or minus 10% of the payment for in-person claims.
Telehealth serves to increase access and convenience for patients, but if it encourages more utilization of services, it could mean greater spending for payers.
The key factor for the evolution of telehealth is how insurers reimburse services, the researchers concluded.
"We do not know at this point if private insurers continue to pay for telehealth in parity with in-person care," they wrote. "However, if telehealth payments continue to be the same as those for in-person care, then this raises questions as to whether telehealth will reduce the spending on common health services, as some have predicted."
A study finds integrating medical, pharmacy, and behavioral benefits reduces total costs, benefiting both employees and employers.
Focusing on health outcomes and affording employees a more personalized healthcare journey can save employers money, according to a study by Cigna.
Aon, the firm that conducted the study, analyzed medical claims of over two million Cigna members who receive coverage through their employers from 2020 to 2021.
The findings showed that Cigna's integrated employer clients saved $148 per member per year in 2021.
Cigna then used a similar study method to determine the financial impact of having employees participate in health improvement programs, such as wellness coaching, and found increased savings of over $1,400 per member per year.
When members with specific high-cost conditions and therapies were enrolled in a triple-integration plan and needed speciality medicines, the savings were nearly $9,000 per member per year. That increased to more than $11,000 when the speciality drug was for an inflammatory conditions like rheumatoid arthritis and nearly $17,500 for members who took speciality drugs and have a confirmed depression diagnosis.
"Integrated benefits provide a real-time, connected platform that enables us to anticipate our customers' unique health needs and support them as they make important health care decisions – driving lower costs over time," said Katy Wong, chief pharmacy officer of Cigna Pharmacy.
"There is tremendous value for employers in having this holistic view across the continuum of care for their workforce. It produces significant savings on health care, which they can pass along to their employees, and it also improves the health of their workforce, which fuels productivity and business growth."
Additionally, the study found that integrating benefits can help lower the costs of chronic conditions. When members were enrolled in a triple-integrated plan, nearly $400 were saved per year for members with a musculoskeletal diagnosis, more than $1,400 saved per year were when an individual with a musculoskeletal diagnosis was engaged with a health coach, and almost $2,500 saved per member per year with a diabetes diagnosis.
Members with integrated benefits and support from health improvement programs also needed fewer emergency room visits and fewer costly invasive in-patient procedures, the study revealed.
Members with diabetes had a 17% lower rate of avoidable emergency room visits, while members with musculoskeletal conditions experienced 133% lower rate of surgeries in an in-patient setting, 26% lower rate of opioid overdoes, and 16% fewer interventional procedures.
Todor Penev, commercial analytics leader at Aon, said: "Employers should feel confident that integrated benefits deliver on the promise of improved health outcomes and ultimately lower the financial risk to the employer, helping build a more resilient workforce."
Findings from a survey reveal shared negative experiences with surprise billing, billing estimates, and medical debt.
As more and more people continue to choose high-deductible health plans (HDHPs), the patient financial experience is likely to include issues related to medical billing, according to a YouGov survey commissioned by revenue cycle firm AKASA.
The survey fielded responses from 2,206 individuals, including 179 with employer-sponsored HDHPs, between March 9 and March 14, 2022.
When asked if they had ever received a surprise medical bill, 50% of the individuals with employer-sponsored HDHPs said they had.
Respondents were also asked if they had ever received a bill that did not match the upfront price estimate for care or services. More than half (53%) with employer-sponsored HDHPs answered yes.
Negative experiences among the respondents during the billing process didn't just end at receiving the bill but extended into medical debt.
More than a third (34%) of those with HDHPs said they had been harassed by a medical debt collector before, while 44% of individuals with HDHPs stated they had experienced financial hardship from bills.
"Enrollment in high deductible health plans grew 43% from 2014 to 2019, and with it has come a similar rise in patient responsibility for payments," said Amy Raymond, VP of revenue cycle operations at AKASA.
"With high health insurance premiums, deductibles, and cost of care, patients are shouldering more of the financial burden of healthcare. This has led to increasing rates of bad debt for hospitals and health systems. Providers must modernize their systems with options that drive more consistent patient behaviors in paying for services."
Another survey commissioned by AKASA found that medical bills are more likely to come across as confusing than straightforward to patients.
In that survey, more respondents either found bills extremely confusing (19%) or somewhat confusing (19%), compared to those that said bills are not confusing (11%) or leaned towards bills not being confusing (14%).
A survey of privately and publicly insured individuals highlights the need to improve the healthcare financial journey.
Many patients are at their wits' end when trying to correct a billing error—an issue that crops up far too often, according to a study from Zelis and Hanover Research.
The findings were gathered through an online survey to 800 privately and publicly insured adults who had found at least one medical billing error in the last five years.
More than two in five respondents (41%) said they are significantly frustrated trying to address billing errors, with only 30% expressing extreme confidence in their ability to identify an error in their bill.
Knowing who to contact and how to find the right contact information were identified as the two biggest hurdles during the bill correction process, suggesting that the patient financial experience is too complicated.
When patients did notice an error, it was either by comparing charges with estimated costs (32%), comparing charges to explanation of benefits (29%), or noticing items on the bill that differed from their care experience (29%).
Most of the respondents (62%) said saving money is the primary motivator for correcting a billing error, with half the respondents reporting incorrect charges of at least $200 and a quarter experiencing a difference of more than $500 in the past five years.
The bill resolution process can not only be confusing, but time-consuming as well. Forty three percent of respondents spent up to one month getting bills corrected, while 70% spending more than two hours on the process.
As such, 80% of patients believe their health insurance plan could have a more well-defined process to deal with billing errors, as well as better service, clearer options, and more efficient resolutions.
"Our research reinforces that healthcare billing systems are complicated, and bills can be complex and with the potential for errors," Michael Axt, chief member empowerment officer at Zelis, said in a statement.
"This negatively impacts healthcare consumers, particularly those with lower incomes or less health literacy. Healthcare organizations have an opportunity to reduce friction in the billing process to support consumers and create a more seamless healthcare financial journey."
A separate YouGov survey commissioned by revenue cycle firm AKASA further establishes how befuddling medical bills can be for patients.
More respondents either found bills extremely confusing (19%) or somewhat confusing (19%), compared to those that said bills are not confusing (11%) or lean towards bills not being confusing (14%).
Being able to understand what they're being billed for (29%) was chosen as the biggest source of frustration, while uncertainty on if they can pay the bill (27%) was a close second.
More people than ever have enrolled in the program, which makes up nearly half of all Medicare beneficiaries.
Medicare Advantage (MA) plans now have a record-high 30 million enrollees, according to new data released by CMS.
The numbers, as of the January 1 payment which reflect enrollments accepted through December 2, 2022, illustrate MA's continued growth in reaching the milestone and beyond.
In 2022, MA had more than 28 million enrollees, which accounted for 48% of the eligible Medicare population, according to analysis by Kaiser Family Foundation.
"With more than 30 million seniors and people with disabilities now enrolled in Medicare Advantage - nearly half of all who are eligible for Medicare – it is a huge endorsement of the value of this program," Matt Eyles, president and CEO of AHIP, said in a statement.
"This milestone shows that people are choosing MA for better affordability and health outcomes. The continued growth of the program is a testament to the tremendous value MA offers to all enrollees, and especially those with chronic illnesses who require care coordination and management, as well as those with low incomes who rely on MA's access to additional benefits at little or no cost."
Much of the new MA enrollment growth can be traced to members switching over from traditional Medicare, research published in JAMA Health Forum found.
A higher rate of members switched from traditional Medicare to MA than in the opposite direction from 2017 to 2020. The switching rates contributed to new MA enrollment growth, rising from 49% in 2016 to 67% in 2020.
A report by the Commonwealth Fund revealed that more benefits and a limit on out-of-pocket costs are the main drivers of older adults choosing MA plans.
About one in four (24%) respondents surveyed cited additional benefits as their reason for choosing MA, followed by out-of-pocket cost limits (20%).
High volume has created a backlog that federal departments have to sift through to review and process disputes.
The No Surprises Act may be preventing unexpected bills, but the law's independent dispute resolution (IDR) process is being used significantly more than the federal government anticipated, according to a government report.
HHS, the Department of Labor, and the Department of the Treasury released statistics on the IDR process from April 15 to September 30, 2022, detailing how often providers and payers utilized arbitration to resolve disagreements over payment for items and services after an unsuccessful negotiation period.
The IDR portal was opened on April 15, 2022, just over 15 months after the No Surprises Act was signed into law to protect patients from surprises out-of-network bills. The Departments estimated that 17,333 claims would be submitted in the IDR process annually.
In reality, the IDR process saw 90,078 disputes over the aforementioned period in the report, far and away outpacing expectations.
The Departments state that disputes reached 18,163 in the second quarter (April 15 to June 30, 2022), including disputes over items and services that would have been eligible for the Federal IDR process beginning January 1, 2022, when the surprise billing protections became effective.
The third quarter (July 1 to September 30, 2022) saw nearly four times as many disputes as the second quarter, totaling 71,915.
Most of the disputes in the second and third quarters were for emergency or non-emergency items or services and most of those disputes were submitted by out-of-network providers and facilities.
Of the total disputes initiated, 23,107 were closed, 3,576 reached a payment determination, and 15,895 were found ineligible for the IDR process. The remaining closed disputes were either withdrawn by the disputing parties, were closed because the parties reached an outside settlement, or were closed for other reasons, such as incorrect batching, data entry errors, or unpaid fees.
The backlog of disputes is due to the review and processing time needed to determine the eligibility of disputes.
"It is within this context that the Departments are working to enhance the Federal IDR portal's ability to intake and process disputes and associated data," the report stated.
Providers and payers have struggled to get on the same page on how the IDR process should be settled, with medical associations filing multiple lawsuits contending the emphasis on the qualifying payment amount, or the median in-network rate.
According to analysis by the Commonwealth Fund, providers are favored in some states' IDR process compared to the federal system, which could lead to higher payments for providers.
Marketing practices have caused CMS to put rules in place to curb deceptive or inaccurate ads.
Medicare Advantage (MA) marketing has come under scrutiny for unscrupulous tactics, but where exactly is it coming from?
According to a report from the Commonwealth Fund, non-government entities account for one-third of all Medicare-related search records and 87% of all search engine ads, creating confusion for beneficiaries and consumers struggling to select an appropriate health plan.
"Medicare Advantage plans are promoted through direct mailings, telemarketing, and advertising on radio, television, websites, and social media channels," the researchers state. "No organization, including the federal government, directly 'markets' traditional Medicare, although commercial insurers sell supplemental Medigap and Part D plans for people in traditional Medicare. Thus, nearly all beneficiaries are subject to some form of marketing effort."
When users search for information on Medicare, 20% of the records are from agents, brokers, or partners, while 16% are from health plans. CMS is responsible for the largest share of search records at 27%.
When it comes to search engine ads, agents, brokers, and partners make up 55% and health plans an additional 32%. CMS only has 7% of the ads, tied with other for-profit organizations.
While 40% of Medicare beneficiaries do not receive any help with their plan choice, the ones that do most often turn to brokers and agents for guidance – 30% in traditional Medicare and 31% in MA.
As brokers and agents are paid commission by insurers, beneficiaries can be negatively influenced. Researchers for the Commonwealth Fund highlight that CMS has reported more than 41,000 complaints in 2021 about Medicare private plan marketing, which was double the number in 2020 and up from about 6,000 in 2017.
To alleviate complaints and combat misleading marketing practices, CMS has proposed a ruleto prohibit ads that don't mention a specific plan name, as well as ads that use words, imagery, language, or logos that can be confusing and deceptive.
It is unclear, however, if the restrictions put in place will affect outcomes. Researchers believe more needs to be done to better understand what information is accessible for Medicare beneficiaries.
"Additionally, more information about agent and broker compensation — including overrides and payment for other services such as health risk assessments, as well as more transparency around the relationships between health care providers, TPMOs, and insurers — could help CMS ensure a level playing field and assess whether compensation and other financial arrangements are aligned with beneficiaries' interests," the researchers concluded.
A recent survey of uninsured individuals finds that health insurance is considered too expensive or unaffordable for most.
The main reason many people don't have health insurance is the perceived high cost, according to a survey conducted on behalf of Florida Blue.
Hundreds of uninsured Florida residents aged 21 to 64—with more than half uninsured for three or more years or having never had health insurance—were polled online between October 6 and October 31, 2022, to better understand why they have no coverage.
The results revealed that the perceived high cost of insurance is the biggest barrier to the uninsured, with almost 70% of respondents saying they can't afford health insurance or feel it is too expensive.
Sixty five percent of respondents believed it would cost $50 to $500 per month for insurance, while 11% thought the cost could be $10 or less. In reality, however, the study points out that four out of five people with Affordable Care Act (ACA) Marketplace plans are able to find coverage for $10 or less per month after financial assistance and over 90% of Marketplace enrollees receive financial assistance.
"At Florida Blue, we are dedicated to providing our communities with access to affordable, high-quality health care solutions," Pat Geraghty, president and CEO of Florida Blue, said in a statement.
"We realize that people are busy, tired, and everything costs more, but we are here to help them during these challenging times and make it easier than ever to switch plans or sign up for plans, especially during the open enrollment period that closes on January 15."
Aside from believing insurance costs are too high, many of the people surveyed did not know what coverage gets them. Almost three in four respondents (73%) were unaware that most health plans cover preventive care, such as regular checkups, mammograms, colonoscopies, and vaccinations with no out-of-pocket costs.
While health insurance awareness can be improved among the uninsured, the national uninsured rate did reach a record-low of 8% in the first quarter of 2022.
The ACA Marketplace saw 11.5 million people enroll in a health plan last year, which marked an 18% increase from 2021, with the Inflation Reduction Act making plans more affordable and accessible.
The agency recommends the payer refund the estimated overpayments to the federal government and review its compliance procedures.
Cigna-HealthSpring of Tennessee received $5.9 million in Medicare Advantage overpayments for 2016 and 2017, a report by the Office of Inspector General (OIG) found.
The audit sampled 279 unique enrollee-years with the high-risk diagnosis codes for which Cigna received higher payments and revealed that 195 of the enrollee-years did not have medical records that supported the diagnosis codes.
The sample resulted in $509,194 in overpayments, with OIG extrapolating that figure to estimate that the payer owes nearly six million over a two-year span.
"As demonstrated by the errors found in our sample, Cigna's policies and procedures to prevent, detect, and correct noncompliance with CMS's program requirements, as mandated by Federal regulations, could be improved," OIG stated.
OIG recommended that Cigna refund the $5.9 million of estimated overpayments back to the federal government and identify similar instances of noncompliance that happened before and after the audit period to refund any other potential overpayments.
Additionally, OIG asked the health insurer to examine its compliance procedures to find where improvements can be made to ensure that diagnosis codes that are at high risk for being miscoded comply with federal requirements and take the necessary steps to update those protocols.
Cigna did not concur with OIG's recommendations or findings and claimed that that intent and design of the investigation was "contrary to Medicare Advantage regulations and the goal of payment accuracy audits."
Following Cigna's comments, OIG revised the number of enrollee-years in error from 201 to 195 and revised the estimated overpayments from $6.3 million to $5.9 million. However, the agency did not alter its recommendations.
The audit of Cigna is one of many OIG has recently conducted of Medicare Advantage plans, including a report on Humana that uncovered $34.4 million in overpayments in 2016 and 2017.