Radar on Medicare Advantage
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Amid Legal Disputes, Anthem’s NYC Contract Faces Second Delay
Anthem, Inc.’s pending contract to serve retired New York City workers and their dependents — which would have nearly doubled the insurer’s Medicare Advantage Employer Group Waiver Plan (EGWP) enrollment — is in peril. Just days before its planned start, the city’s comptroller refused to register the proposed contract and turned it back to Mayor Eric Adams (D) for a revised cost estimate, putting the already delayed transition to a retiree MA plan on hold.
“Due to the legal and budgetary uncertainties that remain while litigation over the City’s contract with Anthem Insurance Companies continues, the Comptroller’s office does not have sufficient information to register the proposed Medicare Advantage Plan contract at this time,” New York City Comptroller Brad Lander explained in a March 30 statement posted to the comptroller’s website. Subsequently, the city’s Office of Labor Relations posted that the transition to the NYC Medicare Advantage Plus Plan would not be implemented as of April 1 as planned and that all retirees “will remain in their current plans until further notice.”
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Stakeholders Seek Ways to Accelerate Risk Sharing in MA
Although Medicare Advantage is outpacing other payer types in the move from volume to value, there are still ways the program could hasten the shift to value-based care, experts agreed during a recent panel of the AHIP 2022 National Conference on Health Policy and Government Programs. These range from the increased use of Z-codes to document social determinants of health to the adoption of a Star Ratings measure that would influence more risk sharing between MA organizations and their providers.
According to the Health Care Payment & Learning Action Network survey, which is conducted in partnership with AHIP and the Blue Cross Blue Shield Association, 58% of MA payments to providers in 2020 were through an Alternative Payment Model (APM) such as the Shared Savings Program or an episodic/bundled care payment model, and 29.3% of such payments were for a risk-bearing arrangement. That’s compared with nearly 43% of payments through APMs in Traditional Medicare and roughly 35% in both commercial and Medicaid plans.
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Medicare Advantage’s Two-Sided Risk Model Associated With Reduced Acute Care Use
Value-based payment models can significantly lower acute care usage among Medicare beneficiaries, suggested a study of nearly 500,000 Medicare Advantage members published last month in JAMA Network Open. The study, which analyzed data collected between December 2017 and January 2019, was led and reviewed by the Humana Healthcare Research Human Subject Protection Office. (Humana is the second-largest MA insurer in the U.S). MA beneficiaries participating in two-sided risk models had lower rates of hospitalizations, observation stays and emergency department visits compared with fee-for-service (FFS) Medicare enrollees. This effect was particularly striking in avoidable acute care use — the two-sided risk model was associated with a 15.6% reduction in avoidable hospitalizations. Researchers noted a lack of significant differences between FFS and upside-only risk models, which “suggests that downside financial risk may play a key role in effective value-based payment arrangements.”
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CMMI Director Shares Vision for More Physician Accountability
Aligning with the Biden administration’s goal of improving health equity, the CMS Center for Medicare and Medicaid Innovation (CMMI) last year unveiled a “strategy refresh” that included health equity as a key objective in testing models of care for Medicare and Medicaid beneficiaries. Another strategic goal was to increase the number of beneficiaries in a care relationship where the provider is accountable for quality and total cost of care, with the objective of having all Medicare beneficiaries aligned with accountable entities by 2030.
Addressing a few recent changes to existing models, CMMI Director Elizabeth Fowler, Ph.D., said the agency’s goal in redesigning the Global and Professional Direct Contracting (GPDC) Model was to reorient it toward provider participants and respond to feedback from stakeholders. The model had been criticized for furthering the privatization of Medicare and allowing for-profit entities to manage fee-for-service (FFS) Medicare beneficiaries without their full knowledge and consent.
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News Briefs: CMS Will Now Cover and Pay for Over-the-Counter COVID-19 tests for Medicare Enrollees
Effective April 4 and through the end of the COVID-19 public health emergency, Medicare will cover and pay for over-the-counter COVID-19 tests at no cost to people with Medicare Part B, including those enrolled in Medicare Advantage plans. Through the new initiative, beneficiaries can obtain up to eight tests per month from participating pharmacies and health care providers, CMS said on April 4. The agency noted that this is the first time that Medicare has covered an over-the-counter self-administered test at no cost to beneficiaries.
UnitedHealth Group on March 29 said it will spend approximately $6 billion in cash to acquire LHC Group, Inc., a home health care company. If the deal goes as planned, LHC will be folded into UnitedHealth’s Optum division; the companies expect to complete the transaction in the second half of the year. The move will make UnitedHealth a major player in home care and hospice care, positioning it alongside rival Humana Inc., which purchased Kindred at Home last year.
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