The second preview of HealthLeaders Payer Week, five days of in-depth coverage and exclusive interviews.
HealthLeaders Payer Week features five days of in-depth coverage spotlighting the significant roles and contributions of insurers. Our week-long exploration, Medicare Advantage in the Hot Seat: Challenges and Opportunities, will include:
Medicare Advantage's tremendous market growth and expansion
The sticky business of Medicare Advantage prior authorization and marketing
The intersection of benefit design and provider performance
Rising drug costs and Medicare Advantage health plan counter-moves
The Star Ratings program evolution
Below is some of what you can expect for Payer Week. Part one previewed drugs costs and coverage, star ratings, and the Medicare value-based insurance design program.
Preview 1: Deceptive marketing and the role it plays in luring seniors
One aspect of Medicare Advantage that has come under great scrutiny is how plans market to new and existing enrollees. Seniors are often the target of misleading and inaccurate advertising, which only creates confusion for Medicare beneficiaries attempting to choose what plan suits them best.
Where is that marketing coming from and what regulations can combat it? Lawmakers have set their sights on these deceitful tactics and CMS has stepped in to impose tighter restrictions on how plans can attract members.
Preview 2: Can I have your approval, please?
Prior authorization can be problematic in any health plan, but it's been particularly burdensome in Medicare Advantage. And despite it being recognized as a glaring issue, the prior authorization headache in the private program seemingly isn't getting any better.
It's first and foremost leading to situations where necessary care is delayed or denied, but it's also putting increased administrative pressure on providers at a time when hospitals, health systems, and practices are feeling the financial and workforce squeeze.
Preview 3: Will the growth boom quiet down in 2024?
For the first time ever this year, Medicare Advantage became the coverage provider for more than half of all eligible Medicare beneficiaries. The growth has been steady and consistent over recent years and it's unclear when it will slow down.
However, CMS has thrown a monkey wrench into the works with some of its regulations, especially the risk adjustment changes which may impact how payers operate. Plans have experienced record enrollment, but competition is also as high as ever.
Preview 4: Checking under the supplemental benefits hood
Nearly all Medicare Advantage plans offer supplemental benefits and those offerings can entice enrollees in ways traditional Medicare can't. Yet encounter data on utilization of those benefits is still limited.
Better understanding how supplemental benefits impact beneficiaries can potentially further unlock Medicare Advantage, but that could require implementing standardization and reporting measures that are currently not in place.
The two sides remain apart as the payer's prior authorization mandate is set to begin on June 1.
A meeting between UnitedHealthcare (UHC) and the American College of Gastroenterology, American Gastroenterological Association, and American Society for Gastrointestinal Endoscopy failed to produce a resolution in the fight over the insurer's prior authorization policy, the societies said.
The payer and GI providers convened for a meeting in which UHC proposed delaying its GI prior authorization program, which goes into effect June 1, "in exchange for an 'advance notification program,' requiring GI practices and staff to gather detailed patient data prior to procedures and in preparation for a Gold Card program in 2024," according to a joint press release by the societies.
"Unfortunately, what UHC verbally presented in our meeting was a poorly defined and complicated administrative process. The GI societies are not in a position to appropriately evaluate the UHC proposal with the limited information presented.
"A pause in the June 1 launch of UHC's prior authorization policy requires the GI societies to publicly support this alternative proposal by early next week. Our patients' health is at stake and we cannot meet this unreasonable request."
The societies reaffirmed their desire for UHC to halt its prior authorization policy, which will require approval for nearly half of gastrointestinal endoscopies.
In a response to HealthLeaders about the prior authorization program, UHC said:
"We have made no changes to our policy regarding screening colonoscopies for preventive care, and this policy does not impact screening colonoscopies. We are asking physicians to follow the guidelines and evidence-based practices developed by their own gastroenterology medical societies to help ensure our members have timely access to safe and clinically appropriate care. The physicians who will be most affected by this new policy are those who are not already following these evidence-based practices, which again, were developed by gastroenterology-related medical societies."
"Our electronic submission process allows for immediate approvals for physicians who have a history of following evidence-based guidelines for the requested procedure. For procedures that do not receive immediate approval, decisions are typically made within two business days after receipt of all required clinical information needed for our GI specialists to review the case – well within the average wait time to schedule a service included in this policy."
Only 21% of the payer's Medicare Advantage (MA) members are enrolled in plans with at least four stars.
CVS Health is expecting to take a hit of around $800 million to $1 billion to its operating income in 2024 due to a decline in MA star ratings, the company announced.
In a filing with the Securities and Exchange Commission, the payer revealed that the percentage of its MA members enrolled in plans with star ratings of at least four stars dropped from 87% in 2022 to 21% for 2023. Plans with ratings of at least four stars qualify for bonus payments in 2024, which is why CVS is bracing to take a loss to its operating income.
The insurer said the main reason for its star ratings drop is the full star decrease to Aetna National PPO, which fell from 4.5 to 3.5 stars. The health plan, which makes up 59% of the payer's MA membership, will no longer be eligible for bonus payments in 2024.
When CMS released the 2023 star ratings for MA plans in October 2022, the average rating across all plans fell from 4.37 to 4.15. The methodology was adjusted to account for the pandemic no longer being at the height it was in recent years.
In CVS' recent earnings call, CEO Karen Lynch said she was "encouraged by what we're seeing on the internal metrics relative to our stars performance."
In the filing, the payer stated: "There can be no assurances that the Company will be successful in maintaining or improving its star ratings in future years. Accordingly, the Company's Medicare Advantage plans may not continue to be or become eligible for full level quality bonuses, which could adversely affect the benefits such plans can offer, reduce membership and/or reduce profit margins."
Analysis reveals preference data revenue cycle leaders can use to improve the patient financial experience.
Even with price transparency laws in place, many patients are having experiences with their provider that fail to inspire trust, according to a report by Salucro.
The healthcare financial technology company released its 2023 Trends in Patient Payment Communications report, which focuses on billing, payment options, and patient preferences. The data is made up of responses from 1,348 healthcare consumers surveyed in the spring of 2023, with all respondents having paid a medical bill online within the last 18 months.
When it came to price transparency, 41% of respondents felt that their provider was not transparent about the costs of their medical care, compared to 59% who felt their provider was transparent.
Much of that transparency can be about the billing experience. The report stated that one of the ways to improve patient communications in 2023 is to ensure billing statements are clear, accurate, and transparent.
"Understanding your patients and their needs is a critical step for any healthcare organization looking to implement new solutions into their revenue cycle, and it's more important than ever that the solutions to those needs sit within the context of existing provider workflows," Clayton Bain, founder and CEO of Salucro, said in a press release.
The report also found how the billing experience can influence patient loyalty. Of those surveyed, 36% said they would consider switching providers due to a poor billing experience, which can include inaccurate billing statements and a lack of communication preferences and payment options.
"Poor billing experiences and a lack of payment options are primary factors that could cause patients to switch healthcare providers or write negative reviews," the report said. "Similarly, provider loyalty is influenced by patient satisfaction with the overall billing experience. Providers who value billing transparency and offer modern communication options continue to be rewarded with positive feedback and returning patients."
Another strategy revenue cycle leaders can utilize to create a positive patient financial experience is to educate patients on how to navigate the billing process.
For example, proactively sending patients an estimate of their services cost ahead of time allows for greater transparency, trust, and understanding.
The vice president of medical operations speaks on the health plan's addition of three physician groups participating in its value-based payment program.
Blue Cross Blue Shield of Massachusetts (BCBSMA) is taking steps to boost access to both value-based care and virtual care.
The payer announced the expansion of its primary care network with three new physician groups—Eden Health, On Belay Health Solutions, and VillageMD—which will participate in its value-based payment program and offer members virtual and in-person services, such as telehealth, chronic disease care, mental health support, and carve navigation support.
On the heels of the expansion, BCBSMA also announced Tufts Medicine will becomes the fifth health system to take part in the health plan's equity-focused value-based agreement, with a focus on reducing inequities in colorectal cancer screenings, hypertension, diabetes care, and child and adolescent well-care visits.
The moves highlight BCBSMA's initiative to continue pushing the ball down the field on primary care, said vice president of medical operations Ashley Yeats.
Yeats spoke with HealthLeaders on the impact of the payer expanding its network, how it furthers value-based care and virtual care, and where both currently stand coming out of the pandemic and heading into the future.
This transcript has been edited for clarity and brevity.
HealthLeaders: What was the impetus behind the expansion to add three physician groups?
Yeats: We believe that primary care is essential and at the core of care delivery. In fact, care that's coordinated by primary care physicians leads to better health outcomes. Having a primary care physician enables patients to feel more empowered and take control of their health. They are more likely to get their preventive health screenings, for example, than if they didn't have a primary care physician. However, there's still a real access issue.
Coming out the pandemic, two big opportunities surfaced. One was an acceptance around virtual care and telehealth and how much more patient-centered these can be for people that maybe don't access to in-person primary care. The pandemic also emphasized the need for more mental health services and support.
This seemed like both an opportunity and a natural alignment with Blue Cross' commitment of expanding its primary care network with practices that are transforming care and supporting value-based care through the AQC [Alternative Quality Contract].
HL: Where does the physician shortage factor into the motivation and how does that affect payers like Blue Cross?
Yeats: I don't want to suggest that adding three providers solves the primary care shortage. The acceptance, maturation, and investments that have been made in virtual primary care has enabled greater access across the US that just didn't exist prior to the pandemic. Telehealth has the ability to alleviate some of the impacts of the primary care physician shortage.
Through the use of virtual care, we can improve access and help members get the care they need.
HL: Speaking of virtual care, that seemed to peak during the early stages of the pandemic, but now that the pandemic is more in the rearview mirror, where do you see utilization of virtual care going?
Yeats: Virtual care was a necessity during the pandemic—and it still is. Virtual care has yet to find its equilibrium, but it's getting there. Where it lands is going to depend on the specialty - obviously, some specialties are much more amenable to that kind of care delivery model. Mental health comes to mind—I think we'll see care delivery in that area continue to grow.
I'm interested in seeing what the next few years brings in how virtual care may lend itself to better outcomes than what we've seen to date in chronic disease management. Virtual care is here to stay, and we need to learn and support the potential for innovation.
HL: What does the current value-based care landscape look like and what more needs to be done to achieve full adoption?
Yeats: We pioneered this path in 2008 with our AQC contracts. We were thrilled to be able to leverage that opportunity in small group value-based care contracting that came out of some work in conversations that started in 2017. We stand behind this concept of paying for outcomes and quality and not paying for volume. It's a long road and it requires commitments on all sides (policy-makers, payers, providers, and patients) to ensure that we continue to work toward a more affordable, equitable healthcare system.
The pandemic also emphasized many of the racial and ethnic inequities in care that are prevalent. Part of our vision for the evolution of value-based care is working payment for equity and outcomes into our contracts and hopefully inspiring others to take action.
I believe we're taking the necessary steps to continue to inch forward on this and hopefully drive larger change and adoption on a national scale.
The health plan said it is one of the first in the nation to introduce this type of value-based contract.
Blue Cross Blue Shield of Massachusetts (BCBSMA) is expanding its value-based efforts by bringing Tufts Medicine into its pay-for-equity financial payment model, the health plan announced.
As part of the contract, Tufts Medicine will focus on reducing inequities in colorectal cancer screenings, hypertension, diabetes care, and child and adolescent well-care visits.
"Across our system, we're doing everything we can to make health care more affordable, accessible and equitable," Tufts Medicine CEO Michael Dandorph said in the press release. "For more than a decade, we have aligned quality incentives within our contracts. Equity is one of our key quality metrics, so including this in our relationship with Blue Cross is a natural progression and will ensure continued superior outcomes for our patients."
BCBSMA said it is the first health plan in Massachusetts, as well as one of the first in the country, to use these contracts, which tie financial incentives to achieving measurable improvements in health equity.
Aside from Tufts Medicine, four other Massachusetts health systems have signed on to the value-based agreements: Beth Israel Lahey Health, Mass General Brigham, Steward Healthcare Network, and Boston Accountable Care Organization, which is part of Boston Medical Center.
BCBSMA stated 53% of its members now receive care from clinicians taking part in the pay-for-equity model.
"Resolving systemic inequities requires allyship, and it's our responsibility to work collectively with physicians and hospitals to improve health equity," said Sarah Iselin, Blue Cross' president and CEO. "By engaging another of our state's large health systems in these payment contracts, we're one step closer to a more affordable, equitable health care system for our members."
In the announcement, BCBSMA also highlighted its data on health equity for more than 1.2 million of its commercial Massachusetts members. The health plan said it is using the data, which reveals racial and ethnic inequities in areas of patient care, to work towards eliminating racial disparities in care.
The pandemic continues to effect rebates, even if this year's figure pales in comparison to 2020 and 2021.
Payers will have to fork over about $1.1 billion in medical loss ratio (MLR) rebates across all commercial markets in 2023, according to Kaiser Family Foundation (KFF) research.
Under the MLR provision of the Affordable Care Act, insurers in the individual and small group markets must spend at least 80% of their premium income on healthcare claims and quality improvement efforts, with the remaining 20% going to administration, marketing expenses, and profit. For large group payers, the MLR threshold is 85%.
Insurers that do not meet the MLR threshold are required to pay back excess profits or margins through rebates to their beneficiaries.
Using preliminary data reported by insurers to state regulators and compiled by Mark Farrah Associates, KFF found that payers estimate they will issue over a billion dollars in rebates across commercial markets, $500 million in the individual market, $330 million in the small group market, and $250 million in the large group market.
The $1.1 billion in rebates for this year is larger than those issued in most previous years, but is well short of the record-high rebates of $2.5 billion in 2020 and $2 billion in 2021 due to the early stages of the pandemic.
The pandemic continues to influence this year's figure as MLR rebates are based on a three-year average, meaning 2023 will be calculated using payer financial data in 2020, 2021, and 2022. In 2020, cancelled elective care and individuals choosing to forego routine care resulted in health spending and utilization going down, KFF stated.
Payers had already set their 2020 premiums before the pandemic, which led to many being over-priced relative to the amount of care beneficiaries utilized.
"Another year of higher loss ratios in the individual market may foretell further premium increases in 2024, as some insurers will aim for lower loss ratios to regain higher margins," researchers wrote. "In recent years, insurers in all markets had experienced a great deal of uncertainty in setting premiums during the pandemic. Looking ahead to 2024, some of that uncertainty may continue, specifically relating to pent-up demand or the health effects of missed and delayed care."
Research into utilization and spending for need-based subgroups suggests integration of the two programs could better serve enrollees.
There is a need for integration strategies combining both Medicare and Medicaid benefits due to significant use of both payers among need-based subgroups of dual-eligible beneficiaries, according to a study published in JAMA Health Forum.
Due to their complex care needs, dual-eligible beneficiaries account for a disproportionate share of spending and the lack of coordination between Medicare and Medicaid results in higher costs and worse care, researchers stated.
To quantify how the use of services and spending by payer differ across need-based subgroups, the study looked at Medicare and North Carolina Medicaid claims data from 2014 to 2017. Included in that were 333,240 North Carolina Medicaid beneficiaries with full Medicaid benefits ever enrolled in Medicare during the study period.
Researchers observed fewer acute care events in Medicaid than Medicare, like emergency department visits, hospital admission, and inpatient days. The difference in acute care events was highest among the nursing home resident subgroup.
Medicare had more home health visits and hospice days, while Medicaid had more behavioral health service visits.
In terms of spending, combined total expenditure for Medicare and Medicaid was $26,874 per person-year. The proportion of total spending paid by Medicaid varied by need-based subgroup, with Medicaid contributing up to 70% of total spending for high-need populations, including nursing home residents.
However, researchers found that overall spending was evenly distributed between the programs, with Medicare at $14,175 and Medicaid at $12,698.
The findings indicate that integration of the two programs is necessary to better serve dual-eligible beneficiaries. Integrated programs currently exist, like the Program for All-Inclusive Care for the Elderly (PACE), Medicare-Medicaid-managed care plans including the Financial Alignment Initiative (FAI), and Dual Special Needs Plans (D-SNPs). Yet only 10% of dual-eligibles nationally are enrolled in programs that integrate Medicare and Medicaid care models, payments, and administrative processes, the study highlighted.
Researchers stated that expansion of PACE could help with integration efforts by allowing more individuals to enroll and receive integrated care, as well as increase opportunities for collaboration between non-PACE and PACE organizations.
"The diversity of health care use suggests that a tailored approach to integration strategies with comprehensive set benefits that comprises Medicare and Medicaid services, including LTSS [long-term services and supports], BH [behavioral health], palliative care, and social services is needed," researchers concluded.
"These findings may inform the design of integrated programs that could improve access to whole-person, beneficiary-centered care for dual-eligible beneficiaries and their families."
The organization stressed that hospitals and health systems are making progress on complying with regulations.
Ahead of a hearing by the House Ways and Means Committee this past week, the American Hospital Association (AHA) submitted to Congress recommendations to strengthen price transparency efforts.
Hospitals have been slow to react to the price transparency law, which went into effect on January 1, 2021, while CMS has been relatively lenient on enforcement. However, AHA said compliance will continue to rise as hospitals put the COVID-19 pandemic in their rearview mirror and pointed to CMS' recently updated enforcement processes for holding hospitals more accountable going forward.
When CMS initially assessed 235 randomly sampled hospitals between January and February 2021, only 27% had both a machine-readable file and consumer-friendly display, with 30% having the former and 66% having the latter.
In CMS' second assessment of 600 hospitals between September and November 2022, those figures improved drastically. The report found that 70% posted a machine-readable file and consumer-friendly display, with 82% having one or the other.
"The lower compliance rate in 2021, however, should not be interpreted as a lack of hospital commitment to transparency," AHA wrote. "Instead, it reflects the incredible challenges hospitals were experiencing in 2020 and 2021 in addressing the most acute phases of the COVID-19 public health emergency, which strained hospitals' staff and required the diversion of personnel and financial resources.
"As the pandemic phase of COVID-19 winds down and hospitals have been able to resume more standard operations, they are able to dedicate the resources necessary to build the full suite of price transparency tools."
Increased enforcement should also, in theory, incentivize hospitals to comply.
As of April 2023, CMS has issued more than 730 warning notices and 269 corrective action plan (CAP) requests, while fining four hospitals for noncompliance: Northside Hospital Atlanta ($883,180), Northside Hospital Cherokee ($214,320), Frisbie Memorial Hospital ($102,660), and Kell West Regional Hospital ($117,260).
More fines could be on the way after CMS recently announced that it will now require CAP completion deadlines, impose civil monetary penalties earlier and automatically, and streamline the compliance process.
To support hospitals and health systems as they work towards improving price transparency, AHA asked Congress and the Biden administration to review and streamline existing transparency policies "with a priority objective of reducing potential patient confusion and unnecessary regulatory burden on providers." These policies include the hospital price transparency rule and the No Surprises Act.
AHA also recommended that lawmakers "refrain from advancing additional legislation or regulations that may further confuse or complicate providers' ability to provide meaningful price estimates while adding unnecessary costs to the health care system." Before additional legislative changes are made to the hospital price transparency rule, recent modifications CMS made to the compliance process should be reviewed.
Finally, the organization stated that Congress should "continue to convene patients, providers and payers to seek input on how to make federal price transparency policies as patient-centered as possible."
Employers may follow a ruling by a federal judge that struck down preventive care services in the Affordable Care Act (ACA).
More than a quarter of employers either don't know if they will continue covering preventive care services or expect to be more selective, according to a survey by the National Alliance of Healthcare Purchaser Coalitions.
The organization polled 29 employers representing approximately 1.5 million employees from April to May 2023 to better understand employer attitudes towards health benefits and their plans following the end of the public health emergency (May 11).
Employers were asked about their feelings on preventive care in light of a federal district court judge in Texas invalidating enforcement of preventive care mandates under the ACA.
While 72% of respondents said they expect to continue providing coverage for all preventive services, 22% said they do not know how they will approach coverage for preventive care and 6% stated they plan to be more selective.
Furthermore, only 14% of employers are planning to fully cover over-the-counter COVID-19 tests, with 33% saying they will not cover them. Going forward, 71% said COVID treatment will be covered similar to non-COVID services and 24% will fully cover.
Three in four (76%) respondents said that keeping up-to-date on current COVID guidelines is central to their immunization strategies, while 81% agreed that the urgency for vaccinations is high.
When it comes to vaccine information, 81% of respondents believe that employers are a trusted source, compared to 62% for health plans.
"The pandemic has reinforced the critical role of immunizations in workforce health strategy but it also raised newfound concerns, confusion and misinformation," Michael Thompson, National Alliance president and CEO, said in a press release. "With the end of the public health emergency, employers expect to double down on education and employee engagement to encourage vaccinations across the board."
It will likely be some time before the dust settles on the litigation process on preventive care under the ACA, but in the meantime it could mean many lose coverage.
