Health Plan Weekly
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Humana Anticipates Strong EPS Growth in 2023, Cites Individual MA Enrollment Increase
During its fourth-quarter and full-year 2022 earnings call on Feb. 1, Humana Inc. said that it will have strong adjusted earnings per share (EPS) growth and see a significant increase in its individual Medicare Advantage (MA) enrollment this year.
Humana projects its adjusted EPS in 2023 will be at least $28, which “is slightly favorable to prior statements” and is 10.9% higher than its $25.24 adjusted EPS for 2022, Jefferies analyst David Windley wrote in a note to clients on Feb. 1.
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Study Could Help Policymakers Set Fair Reimbursement Rate for Ground Ambulances
Ground ambulance services are exempt from the federal ban on balance billing, also known as surprise billing, and a new study published in the journal Health Affairs found that privately owned ambulances are more likely to balance bill than their public sector counterparts. The study’s findings will doubtless be considered by a new federal panel convened to recommend solutions to the complexities of ground ambulance balance billing, which could shape potential legislation to fix the problem in the current Congress — legislation that could find the federal government setting rates for ambulance reimbursement.
A key reason that ground ambulance services were not included in the No Surprises Act (NSA) — the 2020 law that bans medical balance billing — is the ownership structure of ambulance services. About 60% of ground ambulance providers are funded by local governments as part of their fire departments or as a quasi-utility, according to Loren Adler, a coauthor of the study and an economist and associate director of the USC-Brookings Schaeffer Initiative for Health Policy. That arrangement is somewhat unique in the U.S. health care system.
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As CMS Finalizes RADV Rule, Prior Audits Shed Light on Payment Errors, High-Risk Codes
In a highly anticipated final rule on the Medicare Advantage Risk Adjustment Data Validation program, CMS on Jan. 30 said it would extrapolate RADV audit findings starting with the 2018 payment year. Notably, CMS will not extrapolate RADV audit findings for payment years 2011 through 2017 as it had previously proposed. Currently, CMS reviews a small sample of patient medical records to compare them with billing codes sent to the federal government. Under the final rule, CMS will extrapolate the error rate found in the sample to the entire plan. Additionally, the rule finalized a plan to not apply a “fee-for-service adjuster” to its audit methodology. Using the new methodology, CMS officials said the agency expected to recover $479 million in overpayments from 2018 alone, and an extra $4.7 billion from 2023 through 2032.
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News Briefs: Public Health Emergency Is Slated to End in May
The COVID-19 public health emergency (PHE) will end on May 11, the Biden administration said. Emergency authorities flowing from the PHE have required insurers to make certain COVID-19 testing and treatment available to plan members at no additional cost; expanded access to telehealth in Medicare, Medicaid and CHIP; increased funding to states for Medicaid; and barred states from disenrolling Medicaid members. In December, Congress authorized states to begin disenrolling Medicaid members starting in April, with enhanced funding declining and zeroing out on a set schedule starting then. The Biden administration’s announcement comes as Republicans, newly in control of the House of Representatives, have introduced bills that would end the PHE much sooner. The May 11 end date “align[s] with the Administration’s previous commitments to give at least 60 days’ notice prior to termination of the PHE,” according to a White House statement.
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Elevance’s Louisiana Purchase Could Portend More Blue Cross Blue Shield Consolidation
Elevance Health, Inc. on Jan. 23 announced a deal to acquire Blue Cross and Blue Shield of Louisiana, breaking what one analyst called a nearly two-decade “ice age” in which no major consolidation among Blues took place. Experts say it’s unclear whether the tie-up is a harbinger of a flurry of similar dealmaking, but they suggest that the time may be right to see additional mergers and acquisitions (M&A) among Blues affiliates.
“It has been a long drought” since Blues plans conducted major M&A, observes Ashraf Shehata, national sector lead for health care and life sciences at KPMG. And during that time, the country’s largest health plans have gotten larger and more diversified. “So I think…it’s probably time for the industry, especially on the Blue side, to consolidate a bit more,” Shehata tells AIS Health, a division of MMIT.
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