Radar on Medicare Advantage
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Looking to Trim Rising Costs, More Employers Consider MA for Retirees' Medical Benefits
Of the approximately 30.2 million seniors currently enrolled in Medicare Advantage, more than 5.2 million receive their coverage through an employer-sponsored group MA plan, according to the latest CMS enrollment data. That’s roughly the same proportion of MA enrollees in group plans as last year, when AIS Health reported on the rising popularity of Employer Group Waiver Plans (EGWPs, also commonly referred to as group Medicare). Meanwhile, those offerings are growing as the share of employers sponsoring retiree medical benefits is on the decline, according to recent analysis from the Kaiser Family Foundation, which raised questions about the lack of transparency around these plans and the potential cost implications to the overall Medicare program. But industry experts argue that MA offers value to retirees that they can’t get through traditional, fee-for-service (FFS) Medicare.
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Employer Shift to Medicare Advantage for Retiree Benefits Drives Up Program Costs, KFF Report Suggests
The share of large employers offering retiree health benefits via Medicare Advantage plans nearly doubled from 2017 to 2022, according to a new analysis of the 2022 Kaiser Family Foundation Employer Health Benefits Survey. Notably, 44% of those firms do not offer any additional health benefit options outside of MA coverage. This shift has emerged as the overall percentage of large firms offering any kind of medical retirement benefit declined dramatically from the 1980s — KFF found that 66% of large employers offered retiree health benefits in 1988, compared to 21% in 2022.
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As PACE Program Grows, CMS Ups the Auditing Ante in 2023
As Programs of All-Inclusive Care for the Elderly (PACE) grow across the U.S., sponsoring entities can expect CMS to put additional scrutiny on their operations. New PACE organizations are subject to audits in their first three years of operation, and updated audit protocols for 2023 include expanded collection of data around both the clinical services provided to participants as well as the non-clinical program features such as transportation, according to BluePeak Advisors, a division of Gallagher Benefit Services, Inc. This will require significantly more man hours and readiness on the part of the sponsoring PACE organization, adds BluePeak, which helps PACE organizations and Medicare Advantage organizations prepare for audits.
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Express Scripts, Optum Add Humira Biosimilars to 2023 Formularies
As multiple biosimilars to AbbVie’s Humira (adalimumab) are set to hit the market in 2023, two of the largest pharmacy benefit managers (PBMs) in recent weeks made favorable coverage decisions for the soon-to-debut drugs. The FDA has approved seven Humira biosimilars so far, with Amgen’s Amjevita set to launch first, in January 2023. Bloomberg on Nov. 15 reported Optum Rx will cover up to three of the new biosimilars on the same tier as Humira on its 2023 formularies, while Cigna Corp.’s Express Scripts on Dec. 5 said it will cover the biosimilars as preferred products on its “largest formularies.” The PBM said it will “continue to evaluate all biosimilar products to Humira….and will provide updates related to specific changes as available.” Combined, the two PBMs and their corresponding payer units cover nearly 15 million people on their Medicare formularies, according to data from MMIT Analytics (MMIT is the parent company of AIS Health). Most people (86%) covered under Medicare formularies have access to Humira on the specialty tier, with utilization management restrictions such as step therapy and prior authorization.
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News Briefs: CMS Issues Sweeping MA, Part D Rule Cracking Down on Marketing, Utilization Management
In a sweeping proposed rule issued Dec. 14, CMS addresses a variety of hot-button aspects of the Medicare Advantage and Part D programs, including Medicare marketing, prior authorization and overpayments. The 957-page proposed rule, scheduled for publication in the Dec. 27 Federal Register, seeks to protect MA and Part D enrollees from misleading marketing by banning the use of television advertisements that “do not mention a specific plan name as well as ads that use words and imagery, such as the Medicare name or logo, that may confuse beneficiaries in a way that is misleading, confusing, or misrepresents the plan,” according to a fact sheet. It also proposes to adopt the False Claims Act definition of “knowing” and “knowingly” regarding when an MA or Part D sponsor identifies an overpayment, thereby removing the “reasonable diligence” standard. In addition, CMS proposes new requirements to ensure continuity of care, such as requiring that an approved prior authorization remain in place for a beneficiary’s full course of treatment and that all MA plans annually review their utilization management policies to maintain consistency with traditional Medicare’s coverage guidelines.
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