Health Plan Weekly
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Researchers Reassess Provider Directory Accuracy: ‘Things Are Actually Pretty Bad’
As of last year, more than 80% of physicians had inconsistent addresses and specialty information across major health insurance companies’ provider directories, according to a recent JAMA research letter. Neel M. Butala, one of the study’s authors, tells AIS Health the discrepancies can have major implications for patients and payers, including reduced access to care, delayed care and inability to accurately assess physician networks. Regulators also have a difficult time determining whether health insurers meet network adequacy requirements.
Butala adds that he and his coauthors were interested in evaluating provider directories because the No Surprises Act (NSA) includes provisions related to the subject and require insurers to maintain, verify and update their directories. Previously, CMS conducted three rounds of reviews of Medicare Advantage online provider directories, with the last one spanning November 2017 to July 2018 and finding that 48.74% of the provider directory locations listed had at least one inaccuracy. And CMS’s Center for Consumer Information and Insurance Oversight reported similar findings when it compared provider information obtained through secret-shopper calls to machine-readable provider directories in Affordable Care Act marketplace plans for plan years 2017 to 2021.
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Competition Thwarts ACA Exchange Rate Hikes, but Rural Areas Struggle With It
While “benchmark” Affordable Care Act premiums rose in 2023 after declining for multiple years, greater insurer competition in heavily populated regions is still helping to keep rates in check, according to a new analysis from the Urban Institute. Yet some rural areas and smaller cities often don’t attract enough insurers to create meaningful competition — a market dynamic that remains challenging to overcome, one of the report’s authors says.
To produce the analysis, researchers examined premium and insurer participation data from HealthCare.gov for 33 states and from 18 state-based marketplace websites. They zeroed in on “benchmark” premiums — or the rates for the second-lowest-cost silver plans available — because those determine the level of premium tax credits consumers receive.
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Hospital Finances Begin to Stabilize
Hospital margins are beginning to stabilize, with razor-thin margins likely becoming the new normal in the near future, according to Kaufman Hall’s latest National Flash Hospital Report. Based on data from more than 900 hospitals, the report found that hospitals’ median operating margins in February went down slightly at -1.1% from the previous month. Outpatient care is driving revenues, as patients continued to seek care away from inpatient settings due to the pandemic. Meanwhile, inflation and pricing pressures are leading to significant cost growth in supplies and services. Labor expenses, which shot up over the last three years, appeared to be holding steady.
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HealthCare.gov Enrollment Hits Record High; State-Based Marketplace Enrollment Shrinks
A record high 16.4 million people enrolled in Affordable Care Act marketplace coverage during the 2023 Open Enrollment Period, including 12.2 million people who live in states using HealthCare.gov and 4.2 million in 18 states with their own marketplace, according to CMS. Enrollment in HealthCare.gov marketplaces was up 19% compared with 2022, while signups in the state-based marketplaces saw a slight decline for the first time since 2019.
More than half of states saw their enrollment increase by at least 5% from 2022 to 2023, with five states experiencing signup surges of more than 25%. Meanwhile, plan selections in Kentucky, Massachusetts and New Mexico shrunk by over 10% year over year.
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News Briefs: Final Rate Notice, Rule Offer Upside to Medicare Advantage Plans
Medicare Advantage plans can expect to receive, on average, a 3.32% increase in risk adjusted revenue, compared with the 1.03% increase CMS projected in its Advance Notice released on Feb. 1. That’s largely because the agency opted to phase in its controversial changes to the CMS-Hierarchical Condition Categories (HCC) risk adjustment model, rather than fully implement it next year, after considering feedback from stakeholders. Managed care industry leaders have claimed that the proposed rate change was a dramatic shift from previous rate-setting actions, but both the proposed and finalized rate fit within the normal range of rate changes for non-pandemic years, according to AIS Health data. Wall Street reacted with relief to the news, following weeks of anxiety after the Biden administration proposed implementing the lower-than-expected rate increase and risk adjustment changes. Credit Suisse analyst A.J. Rice wrote in a research note that the phasing in of the risk adjustment changes should help both health plans and primary care physicians. One insurer that Credit Suisse analysts spoke to, he said, indicated “that the phase-in approach should enable it to adjust benefits in a relatively modest way for 2024 that should not impede on-going growing interest in MA versus traditional fee-for-service Medicare.” And Jefferies analyst David Windley called the final rate notice “the first piece of positive news for MCOs in months.”
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