Health Plan Weekly

A bundled payment program run by San Francisco-based digital health company Carrum Health resulted in an average per-episode savings of more than $16,000 per orthopedic or surgical procedure performed by a provider in the bundled program, a RAND Corp. analysis found.

Overall, counting both procedures reimbursed under the bundled payment program and procedures reimbursed outside the program, per-episode costs for the three procedures studied — spinal fusion, major joint replacement and bariatric surgery — were 10.7% lower overall, on average, than costs for comparable procedures prior to implementation of the program. That added up to a total savings of $4,229 per episode, the study found.

Health insurers on the Affordable Care Act (ACA) exchanges are consistently overestimating the amount they spend on enrollee benefits as part of their medical loss ratio (MLR) reporting, resulting in “hundreds of millions of dollars in underpaid policyholder rebates,” according to new research. Health policy experts tell AIS Health that the findings could fuel greater regulatory scrutiny on individual market carriers, which are increasingly making a profit on the exchanges and had to shell out less than usual in claims last year due to routine-care deferral during the COVID-19 pandemic.

“With the pandemic, I think it is definitely changing the dynamics of the different stakeholders in the health care markets — so obviously the hospitals and physicians lost a lot of money last year, whereas the plans did pretty well because of that; their claims costs went down,” says Krutika Amin, an associate director for the Kaiser Family Foundation (KFF) Program on the ACA, who was not involved with the study. “So I think that is creating a conversation around whether there’s a need to update MLR requirements.”

The new landscape for telehealth is revealing itself as the COVID-19 pandemic gradually winds down. Existing players are striving to differentiate themselves in an increasingly crowded market, and Amazon.com, Inc. is rolling out a big bet on telehealth and in-home care.

In the latest of a flurry of telehealth transactions, Doctor on Demand Inc. and Grand Rounds Inc. agreed to merge in an all-stock deal announced March 16, which is projected to close in the first half of this year. Meanwhile, on March 17, Amazon unveiled plans to scale its Amazon Health subsidiary nationally after a successful pilot for workers in its Seattle headquarters.

✦ The U.S. Senate on March 18 narrowly confirmed Xavier Becerra, the current California attorney general, as the new secretary of HHS, prompting a slew of statements from health care industry trade and interest groups congratulating Becerra. For example, Matt Eyles, president and CEO of America’s Health Insurance Plans, said in a statement that AHIP looks forward to working with Becerra “to protect and build upon the Affordable Care Act to expand health coverage for all Americans, address the underlying cost of health care, and eliminate racial and ethnic disparities in medical care.” Becerra himself tweeted that “I’m honored and humbled by today’s vote in the Senate. Thank you. I’m ready to get to work at @HHSgov.” Visit https://bit.ly/3lzZyYD.

✦ Letters sent to Arkansas and New Hampshire officials this week confirmed that the Biden administration is formally revoking their “community engagement” waivers, which condition Medicaid eligibility for a subset of beneficiaries upon employment status. The Supreme Court on March 29 was planning to hear oral arguments related to the Trump administration’s approval of Medicaid work requirements in both states, but earlier this month removed the hearing from its docket, suggesting that previous rulings striking down work requirements could stand. View the Arkansas letter at https://bit.ly/30XShsh.

A health insurer trade group is calling on the federal government to change Medicare Advantage (MA) risk adjustment calculations to include telephone visits, saying the issue has become urgent due to the pandemic, which has seen in-person visits drop and telehealth visits increase dramatically.

CMS determines MA enrollee risk scores based on diagnoses submitted by MA organizations through the Encounter Data System, which are then used to determine a plan’s risk-adjusted payments. When CMS expanded reimbursement eligibility for telehealth visits as part of its pandemic response, the agency allowed video telehealth visits to be included in risk-adjustment calculations. However, CMS currently does not allow telephone encounters to be included in risk score calculations.