Health Plan Weekly

The Biden administration released new regulatory guidance meant to block a loophole in the No Surprises Act (NSA) that payers and providers had exploited to send large bills to some patients. However, an attorney tells AIS Health, a division of MMIT, that providers and payers will find ways to work around NSA provisions.

The No Surprises Act, a 2021 law, banned balance or “surprise” billing in most cases. Balance billing occurs when an out-of-network provider will not accept the payment rate offered by a patient’s insurance plan. The law also set up the Independent Dispute Resolution (IDR) arbitration process, which is meant to resolve bills that insurers and providers are unable to agree on themselves. During IDR, providers submit unresolved bills to an HHS-approved arbitrator, who then selects an amount submitted by either the payer or the provider using criteria laid out by HHS. The plan is then required to pay that amount to the provider.

The Kraft Heinz group has sued Aetna, alleging the insurer “leveraged its role as the third-party administrator or ‘TPA’ to enrich itself to Kraft Heinz’s detriment” and breached its fiduciary duties to the employer. The lawsuit contends that Aetna “(a) paid millions of dollars in provider claims that never should have been paid, (b) wrongfully retained millions of dollars in undisclosed fees, and (c) engaged in claims-processing related misconduct to the detriment of Kraft Heinz,” which contracted with the insurer to provide medical and dental benefits for the company’s employees, retirees and their family members. The firm is asking the court to force Aetna to reimburse it for losses linked to the insurer’s alleged fiduciary breach, along with any related profits.

Blue Cross Blue Shield insurers are again set to collect major payouts from the Affordable Care Act’s risk adjustment program, STAT reported based on an analysis of new federal data. The risk adjustment program transfers funds from ACA marketplace insurers that have lower-risk enrollees to those with higher-risk enrollees. STAT found that more than two dozen Blues insurers are projected to collect over $4.7 billion in risk-adjustment transfers for 2022, with Florida Blue, Health Care Service Corp. and Blue Shield of California due the largest amounts.

The return of Medicaid redeterminations, which the managed care sector expected to be a daunting challenge, has proven even more difficult to handle than anticipated. States have begun to seek more time and resources from CMS to manage staggering amounts of beneficiary outreach and other administrative chores. Now, thanks to recent regulatory guidance, states can also pay managed care organizations to take on some of that work. 

Several states — which are ultimately responsible for handling the income checks and disenrollments necessary for what many have called the “unwinding” of COVID-19 pandemic-related continuous enrollment — have paused redeterminations or extended their deadlines for enrollees to complete their redetermination paperwork, and others may follow. The pauses are clear evidence of the scale and complexity of the task at hand.  

While strong premium revenue was one major reason for insurers’ favorable results in 2022, rising fee-based income from PBM and health care delivery assets has also played a major role in those firms’ rising fortunes. While that fact is largely viewed favorably by industry analysts, it’s also been increasingly criticized by lawmakers and other stakeholders concerned about vertical integration in the health care industry. 

“From a ratings perspective, it’s good,” remarks Dean Ungar, a vice president and senior analyst at Moody’s Investors Service. “The diversified revenue stream is better than having a concentrated revenue stream. Of course, the caveat is, if you don’t execute well or if you make acquisitions that are not good acquisitions, you could end up with problems.”