Radar on Medicare Advantage

After a reviewing a second round of bids in an attempt to “ensure a fair and transparent process,” Kentucky Gov. Andy Beshear (D) and the Cabinet for Health and Family Services (CHFS) on May 29 named the same five winners in the Medicaid contract awards originally made under former Gov. Matt Bevin (R). Passport Health Plan, which has a long history of serving the state’s Medicaid program and was on the brink of insolvency until Evolent Health purchased a 70% stake in it, was once again not chosen and plans to protest.

CVS Health Corp.-owned Aetna, Humana Inc., Molina Healthcare, Inc., UnitedHealthcare and WellCare Health Plans, Inc. (now owned by Centene Corp.) in November were selected to manage benefits for approximately 1.4 million Medicaid and CHIP enrollees. All five retained their awards; Aetna also won a separate contract that originally went to WellCare to serve Kentucky SKY, a risk-based managed care delivery program for foster children and the Dept. for Juvenile Justice. Incumbents Anthem, Inc. and Passport were not selected either time; both protested the November decision.

Months after the Part D Senior Savings Model was unveiled, the Trump administration on May 26 held a press conference in the White House Rose Garden to share what reporters and industry observers hoped would be more information about the new benefit that will be available to seniors next year. But the few details that were disclosed regarding participation raised only more questions about the potential success of the model, experts suggest.

CMS on May 26 said 88 Part D sponsors have applied to offer enhanced plans with predictable cost sharing on insulin as part of the Part D Senior Savings Model. Introduced through the CMS Innovation Center in March, the five-year model is intended to lower out-of-pocket costs for diabetic seniors by featuring “predictable” copayments of no more than $35 for a broad set of insulins beginning in 2021 (RMA 3/19/20, p. 1).

Finalizing a series of policies just before the 2021 bid deadline, CMS on May 22 said it will address remaining proposals from its February proposed rule at a later date (RMA 2/20/20, p. 1).

CMS finalized a proposal to count telehealth providers in certain specialty areas (e.g., dermatology, psychiatry, cardiology, ophthalmology) toward meeting CMS network adequacy standards. The agency also lowered the required percentage of rural beneficiaries who must reside within the maximum time and distance standards from 90% to 85%.

There are always uncertainties when it comes to projecting plan costs for the year ahead, but Medicare Advantage and Part D organizations in the most recent bid cycle faced a particularly unpredictable set of circumstances created by the COVID-19 pandemic.

“I think we will all look back on the 2021 bids as the year of COVID-19,” says Brad Piper, a principal and consulting actuary in Milliman’s Milwaukee office, who is fresh off helping clients prepare bids that were due June 1. “That was a big challenge for the organizations that are in the Medicare Advantage program — [perhaps more so] than on the Part D side — and it impacted both sides of the coin: costs and revenue.”

✦CMS at press time said it had approved more than 200 requests for state relief in response to the COVID-19 pandemic, including recent approvals for Alaska, Iowa, Hawaii, New Jersey, North Carolina, Pennsylvania, Rhode Island, Utah and Virginia. CMS in March released a toolkit to speed the application and review of states’ requests for flexibilities, which include making temporary changes to Medicaid eligibility and benefit requirements and relaxing rules to ensure that individuals with disabilities and the elderly can be effectively served at home. Meanwhile, as part of the Trump administration’s “Opening Up America Again” plan, CMS on May 18 released guidance for nursing homes, including that they “remain in the current state of highest restriction even when a community begins to relax restrictions for other businesses.” Visit http://cms.gov/newsroom.

✦strong>Newlight Partners LP and its affiliates have made a significant equity investment in Zing Health Holdings, Inc., a physician-led Medicare Advantage HMO plan that launched last year in the Chicago area. With a focus on “populations underserved by traditional health insurance models,” the HMO was co-founded by physician and entrepreneur Eric Whitaker and Health 2047, the innovation lab of the American Medical Association. Contact Taryn Williams Clark for Zing Health at twilliams@purposebrand.com.