RADAR on Medicare Advantage

  • 2021 Advance Notice Elevates EDS Use, Leaves Out ESRD

    The biggest news out of CMS’s Jan. 6 release of Part I of the 2021 Advance Notice may be that there was no news. As expected, CMS proposed continuing to phase out risk score data based on diagnoses contained in the legacy Risk Adjustment Processing System (RAPS) and increasing the use of encounter data that still vexes some Medicare Advantage organizations. But the document left out any mention of possible payment revisions for the expected influx of MA enrollees with end-stage renal disease (ESRD) next year, raising the question of when (and how) CMS might address a payment structure that is seen as inadequate by some industry stakeholders.

    This is the third year CMS is publishing the Advance Notice of Methodological Changes for MA Capitation Rates and Part D Payment Policies in two parts, thanks to the 21st Century Cures Act (signed into law in 2016) requiring that any proposed changes to the CMS Hierarchical Condition Category (HCC) risk adjustment model have a 60-day comment period.

  • Kansas Medicaid Deal Has Implications for Expansion Holdouts

    In a move that may turn heads in other historically red states that have held off on expanding Medicaid under the Affordable Care Act (ACA), Kansas Gov. Laura Kelly (D) and Republican Senate Majority Leader Jim Denning on Jan. 9 said they’d reached a compromise proposal to extend Medicaid coverage to an estimated 130,000 more low-income Kansans. While the plan is still subject to votes, it contains elements of a state House plan that was rejected by the Senate last year and key components that address concerns from both parties, representing an example of bipartisan compromise that some advocates hope has a ripple effect.

    If approved, Kansas will pursue a full expansion of Medicaid to 138% of the Federal Poverty Level (FPL) with a 90/10 funding match. The state will also seek Section 1332 waiver approval to establish a reinsurance program and Section 1115 waiver approval to transition individuals whose incomes fall between 100% and 138% of the FPL from Medicaid to the exchange no later than Jan. 1, 2022, although expansion is not dependent on those waivers. If CMS denies either waiver, full Medicaid expansion will be implemented on Jan. 1, 2021, according to a summary of the pending legislation.

  • News Briefs

     CareFirst BlueCross BlueShield plans to acquire two Medicaid managed care organizations in the Baltimore and Washington, D.C., areas, respectively. CareFirst on Dec. 20 said it reached separate definitive agreements with Trusted Health Plan, a Medicaid MCO operating exclusively in Washington, D.C., and University of Maryland Health Partners, which serves 47,000 Medicaid enrollees in 20 Maryland counties and Baltimore. The latter is owned by the University of Maryland Medical System, which also offers a Medicare Advantage plan that was not part of the transaction. Trusted began operations in 2013 and covers more than 34,000 enrollees; the company sold its Michigan managed Medicaid business to Health Alliance Plan in June 2019 (RMA 6/20/19, p. 8). View the announcement at https://bit.ly/2uar20l.

     In its first partnership with a managed Medicaid plan, Fitbit this month kicked off a new wellness program with WellCare of Georgia Medicaid. Amy McDonough, senior vice president and general manager for Fitbit Health Solutions, in a LinkedIn blog post explained that approximately 4,000 WellCare members with type 2 diabetes will be eligible to receive a Fitbit Inspire device, along with educational materials and activity challenges through Fitbit’s platform. The aim of the new program is to help members adopt healthier behaviors to better manage their diabetes, she wrote. This builds on the company’s growing number of partnerships in the Medicare Advantage market. Fitbit said its devices will be included in MA plans offered this year by three insurers, including as an embedded benefit in 59 plans offered by UnitedHealthcare across 27 states. Visit https://bit.ly/2QG5XSZ.

  • Centene-WellCare Deal Is on Track for Approval; Combined Company Would Hold Nearly 20% of Medicaid Market

    Centene Corp.’s planned acquisition of WellCare Health Plans, Inc., a $17 billion move that would create a managed Medicaid behemoth and a serious contender in the Medicare Advantage ring, is close to being a done deal. In December, the insurers received regulatory approval from the final states needed to move forward, bringing the total number to 27. The Department of Justice has yet to approve the deal, but Centene CEO Michael Neidorff on Dec. 5 informed attendees of the Forbes Healthcare Summit that he has “told the team to be ready for full integration by January 1,” and expects the deal to close in the first half of 2020. Not only will the combined company be No. 1 in Medicaid, with about 10.2 million enrollees (both Centene and WellCare are divesting their Medicaid plans in three state markets to ease antitrust concerns, see graphics below), it will also snag the No. 6 spot in the national MA market.
  • Kentucky Preps Medicaid Rebid, Giving Anthem, Passport Another Shot at Retaining Business

    The five insurers that were selected for new statewide contracts with Kentucky’s managed Medicaid program will have to rebid now that the state’s new Democratic governor, Andy Beshear, has nullified the awards made under Republican predecessor Matt Bevin.

    The Kentucky Cabinet for Health and Family Services (CHFS) in late November selected Aetna (owned by CVS Health Corp.), Humana-CareSource, Molina Healthcare, Inc., UnitedHealthcare and WellCare Health Plans, Inc. to serve approximately 1.3 million Medicaid and CHIP enrollees starting on July 1, 2020. New entrants Molina and UnitedHealthcare would have replaced Anthem, Inc. and Passport Health Plan.

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