Health Plan Weekly

In January, the U.S. Supreme Court is slated to hear two cases brought by fishing companies that, at first glance, would seem to have nothing to do with health insurers. However, the outcome of those cases could profoundly change how insurers — and companies of all stripes — interact with the many regulations that govern their businesses.  

That’s because the cases — Loper Bright Enterprises, et al. v. Gina Raimondo and Relentless Inc., et al. v. Dept. of Commerce, et al — concern a legal doctrine known as Chevron deference, which for decades has given federal agencies considerable leeway when interpreting laws via rulemaking. If the high court strikes down that longstanding legal precedent, the regulatory landscape that governs every industry could become much more chaotic, legal experts tell AIS Health, a division of MMIT. 

Elevance Health Inc., the parent company of Anthem, enjoyed a strong third quarter, raising its end-of-year earnings guidance and completing a round of stock buybacks. The firm cited a strategic review — which involved layoffs and slashing real estate costs — as a key reason for the results. However, the positive results were dampened by Anthem plans’ middling performance in the newly released 2024 edition of Medicare Advantage Star Ratings, which drew scrutiny from Wall Street. 

The strategic review yielded a $697 million boost to the quarter’s balance sheet, with an Elevance press release touting “the write-off of certain information technology assets and contract exit costs, a reduction in staff including the relocation of certain job functions, and the impairment of assets associated with the closure or partial closure of data centers and offices.” 

Insurer and plan sponsor trade groups strongly oppose the Biden administration’s stepped-up mental health parity regulations, according to statements and public comment letters submitted in response to the latest rulemaking on the subject. Insurer groups AHIP, the Blue Cross Blue Shield Association (BCBSA) and the Alliance of Community Health Plans (ACHP) all lined up against the rulemaking, as did the ERISA Industry Committee (ERIC), a plan sponsor group. 

According to the insurer and plan sponsor groups, the proposed rules, which were released in July, are unworkable. They argue that there are simply not enough providers available to meet the more stringent requirements set out in the proposed regulations. The current round of rules, if implemented, would expand the list of conditions covered by parity rules, require additional data reporting and establish stronger network adequacy standards. Both plan sponsors and carriers could be held liable for violations of most provisions in the Biden administration’s proposed regulations. 

While the managed care stock story in the first half of 2023 revolved around care utilization concerns, the company that first fueled those worries — UnitedHealth Group — eased investors’ minds considerably when reporting third-quarter earnings. 

“Care patterns remain consistent with the view we shared during the second quarter, with activity levels still led by outpatient care for seniors and still most notably in the orthopedic and cardiac procedure categories,” Chief Financial Officer John Rex said, addressing the utilization issue head-on before describing UnitedHealth’s financial results during its Oct. 13 earnings call.  

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.