Radar on Medicare Advantage

  • News Briefs

     President Joe Biden’s 2022 fiscal year budget plan includes multiple health care-related asks aimed at improving Medicare, Medicaid and Affordable Care Act coverage. The budget calls for, among other things, lowering the Medicare eligibility age to 60, enhancing access to supplemental benefits such as dental and hearing in Medicare, and providing “premium-free, Medicaid-like coverage” through a federal public option in states that have not expanded Medicaid, while financial incentives would remain in place to ensure states keep their existing expansions.

     The Senate on May 25 confirmed Chiquita Brooks-LaSure as the new administrator for CMS. The Obama-era policy adviser, who was most recently a managing director with professional services firm Manatt, will be instrumental in carrying out President Joe Biden’s goals of building on the Affordable Care Act (ACA) to improve coverage and controlling prescription drug costs. Matt Eyles, president and CEO of America’s Health Insurance Plans, said the insurer trade group looks forward to “working with Brooks- LaSure to strengthen and improve Medicare, Medicaid, and ACA marketplace coverage.”

  • Anthem Is Second Insurer to Refute OIG Risk Score Review

    In the second example in recent months of a Medicare Advantage insurer disputing the federal government’s method of identifying overpayments, a new HHS Office of Inspector General audit report limited its review to a group of diagnosis codes that it maintained are at a particular risk for being miscoded. In addition to having routine medical record review and auditing activities, MA plan sponsors should take extra precautions to identify provider trends in this high-risk group for more accurate risk adjustment, one industry expert suggests.

    Conducted separately from CMS’s contract-level Risk Adjustment Data Validation (RADV) audits that verify the accuracy of payments made to MA organizations, the recent findings are part of a series of audits in which OIG is reviewing the accuracy of diagnosis codes submitted to CMS. In a similar report released in April, OIG estimated that Humana Inc. received nearly $200 million in net overpayments for a contract serving approximately 485,000 enrollees. Humana at the time disputed the findings and said it would have the right to appeal “if CMS does determine that an overpayment exists.”

  • CMMI Widens Direct Contracting Pool With NextGen ACOs

    In a move that was not entirely unexpected but irked one leading value-based provider group, CMS recently said it plans to discontinue the Next Generation ACO Model next year and instead allow NextGen ACOs to apply for the Global and Professional Direct Contracting (GPDC) Model for 2022. At least four Medicare Advantage insurers have Direct Contracting Entities (DCEs) that are serving fee-for-service (FFS) Medicare beneficiaries through the GPDC, which launched April 1. And while CMS is not taking applications from other new DCEs at this time, experts say there is still strong MA plan interest in the GPDC, and they should not discount the possibility that the applicant pool will open again, albeit with a few possible tweaks.

    In an email sent to participating NextGen ACOs on May 21, CMS said it will end the Center for Medicare and Medicaid Innovation (CMMI) model on Dec. 31 and invited the organizations to apply to join the GPDC starting in performance year 2022 as a Standard Direct Contracting Entity. One of three options for participating in the model, Standard DCEs are composed of organizations that generally have experience serving FFS beneficiaries, including Medicare-only and dual-eligible beneficiaries.

  • OEP Winners Credit Year-Round Outreach, Omnichannel Marketing

    Medicare Advantage enrollment grew just 1% during the 2021 Open Enrollment Period (OEP) that ran from January to March, compared with growth of 7% during the preceding Annual Election Period (AEP), according to AIS’s Directory of Health Plans (DHP). While the large MA insurers continued to nab the bulk of OEP signups (see infographic, p. 7), an AIS Health analysis finds that of the top 25 OEP performers, regional players ranging from established not-for-profit organizations to rising startup insurers followed their AEP successes with OEP gains that were impressive relative to their size.

    After the Medicare AEP that typically runs from Oct. 15 through Dec. 7, the Medicare OEP allows beneficiaries who selected an MA plan to make a onetime coverage change. This year was the third OEP since it was reinstated by the Trump administration, and seniors’ awareness of the opportunity has steadily grown, according to Deft Research. Compared with 67% two years ago, 76% of the MA population was aware of the January through March election period this year, while switch rates during the OEP have stayed between 4% and 5% over the last three years, Deft’s 2021 Open Enrollment Period Study observed.

  • News Briefs

     Reporting earnings for the first time since going public in March, Alignment Healthcare, Inc. posted a net loss of $56.9 million for the first quarter of 2021, compared with a net loss of $10 million in the year-ago quarter. It also recorded a medical loss ratio (MLR) of 91.5% and expects to end the year in the “high 80s,” Founder and CEO John Kao stated during a May 17 earnings conference call. In addition to 32% year-over-year growth in its Medicare Advantage membership, Kao disclosed that Alignment launched two Direct Contracting Entities (DCEs) under the name Axceleran that are serving about 5,800 fee-for-service Medicare lives in California and North Carolina. Meanwhile, Clover Health during its own May 17 earnings call disclosed that it was serving at least half as many Medicare lives as a DCE than it originally projected (RMA 4/15/21, p. 1). In addition to serving more than 66,300 MA members as of March 31, Clover CEO Vivek Garipalli told analysts that the company on April 1 added another 65,000 individuals “through claims alignment alone” as a DCE. In a slide deck presented to investors prior to going public in January, the insurer said it had 200,000 DCE members “already under contract for 2021.” Garipalli during the earnings call said Clover believes it has “access to up to 200,000 Medicare beneficiaries through our contracts with participating providers” and expects to end the year with between 70,000 and 100,000 total aligned beneficiaries. For the quarter ending March 31, Clover reported a consolidated MLR of 107.6%, compared with 89.4% during the first quarter of 2020, largely due to COVID-19 costs, and posted a net loss of $48.4 million, up from a loss of $28.2 million for the year-ago quarter. Read more at https://bit.ly/3wyKZcn and https://bit.ly/3u1H9q8.

     After failing to secure funding to implement voter-approved Medicaid expansion, the Missouri Dept. of Social Services (DSS) on May 13 submitted a letter to CMS formally withdrawing its State Plan Amendments for MO HealthNet expansion. A Missouri appellate court in June 2020 ruled that the ballot initiative, which was approved in August 2020, did not create a revenue source or direct the General Assembly to appropriate funds, thereby giving the GA discretionary authority to fund or not fund expansion, noted a press release from Gov. Mike Parson (R). The GA on May 7 finalized the state’s fiscal year 2022 budget without funding for MO HealthNet expansion or appropriation authority to DSS or the governor. The DSS had estimated that the expansion would cost the state approximately $1.9 billion, which was included in the governor’s recommended budget. Read more at https://bit.ly/33N8VfJ.

The Latest
Complimentary Publications
Meet Our Reporters

Meet Our Reporters

×