Radar on Medicare Advantage

  • With New Comment Period, CMS Will Reassess TennCare Cap

    As the Biden administration continues to dash states’ dreams of implementing Medicaid work requirements — most recently revoking waiver approvals granted to Ohio, South Carolina and Utah by the Trump administration — CMS this month took a critical step in revisiting Tennessee’s plans to use a fixed funding mechanism. With the opening of a new 30-day federal public comment period regarding the approval of TennCare III, experts anticipate a great amount of negative input that will lead the program to a fate similar to that of work requirements.

    The Trump administration on Jan. 8 approved Tennessee’s request to use an “aggregate cap” approach to Medicaid funding that many industry observers have likened to a block grant. The outgoing administration approved the state’s section 1115 waiver demonstration for 10 years. Through the unprecedented approach, Tennessee will receive federal Medicaid funds based on a fixed budget target that is determined by CMS and the state using historical enrollment and cost data. If the state spends less than its target cap while meeting yet-to-be determined quality goals, it can earn up to 55% of annual savings to reinvest back into other state health programs. That waiver also allows the state to implement a commercial-style closed drug formulary.

  • Brooks-LaSure Stresses Health Equity as CMS Considers Future Demonstrations

    CMS will refocus and redouble its efforts on health equity and whole-person health outcomes as the Biden administration evaluates ongoing and potential programs and initiatives, CMS Administrator Chiquita Brooks-LaSure said during an Aug. 12 webcast hosted by Health Affairs. During her remarks, she also hinted that the agency is interested in ensuring a level playing field between fee-for-service Medicare and Medicare Advantage.

    The Center for Medicare and Medicaid Innovation (CMMI) — which is now 10 years old — has refreshed its strategy to focus on equity along with value-based care and person-centered care, Brooks-LaSure explained. She and other CMS officials laid out their CMMI strategy in a Health Affairs blog post published the same day as the webcast.

  • MTM Report Illustrates Challenges of Testing Part D Changes

    As CMS looks to scale back its many models and refocus on health equity, the Center for Medicare and Medicaid Innovation (CMMI) is winding down two Medicare Part D models that were intended to test whether giving plan sponsors certain flexibilities and financial incentives would lead to better outcomes and program savings. One of those models — the Enhanced Medication Therapy Management (MTM) model — did not generate any net savings to the Medicare program and was set to end this year, although one expert suggests the evaluation was flawed. The other model was only in its second year and saw very little interest, and both demonstrate how difficult it is to make significant changes through voluntary Part D models.

    Enhanced interventions to improve Part D beneficiaries’ medication use have had a modest impact on beneficiary outcomes but, when taking into account enhanced payments to plans, have not resulted in savings to the Medicare program, according to the third evaluation report on the Enhanced MTM model that began in 2017. Save for two participants’ performance during a single year, “there have been no significant cumulative Modelwide impacts on total gross Medicare Parts A and B expenditures,” observed the report, which was prepared by Acumen, LLC. In fact, in each of the three model years assessed, sponsors’ payments exceeded the non-significant decreases in gross Medicare Parts A and B expenditures (see infographic).

  • New Ruling Has Major Overpayment Implications for MAOs

    Nearly three years ago, a federal court’s ruling in support of UnitedHealth Group threw a seemingly definitive wrench into CMS’s plans to begin recouping self-identified overpayments from Medicare Advantage insurers. But in a major blow to the leading MA organization and the industry at large, a federal appellate court last week reversed that decision. While this could allow CMS to finally dive into a backlog of overpayments from plans, experts say the ruling may not be the final word on overpayment and that there are some to-be-determined aspects in play.

    In an Aug. 13 opinion from the U.S. Court of Appeals for the District of Columbia Circuit, three judges reversed a 2018 ruling in a UnitedHealth lawsuit that challenged CMS’s 2014 Overpayment Rule. CMS in that final rule clarified the statutory definition of overpayment and codified provisions of the Affordable Care Act that required MA organizations to return identified overpayments within 60 days. UnitedHealth in January 2016 filed a complaint against the federal government and alleged that it violated the ACA’s statutory mandate of “actuarial equivalence” by asking sponsors to return overpayments based on audited records while the methods used to determine MA payment rates prior to risk adjustment are based on unaudited records of fee-for-service (FFS) Medicare transactions.

  • News Briefs

     The U.S. Dept. of Justice has intervened in six False Claims Act complaints accusing Kaiser Permanente of submitting inaccurate diagnosis codes to receive inflated Medicare Advantage reimbursements. According to a July 30 press release, the DOJ intervened in cases filed against the following Kaiser Permanente consortium members: Kaiser Foundation Health Plan Inc., Kaiser Foundation Health Plan of Colorado, The Permanente Medical Group Inc., Southern California Permanente Medical Group Inc. and Colorado Permanente Medical Group P.C. The suits alleged that “Kaiser allegedly pressured its physicians to create addenda to medical records after the patient encounter, often months or over a year later, to add risk-adjusting diagnoses that patients did not actually have and/or were not actually considered or addressed during the encounter, in violation of Medicare requirements,” said DOJ. In a statement on its website, Kaiser Permanente said it intends to “strongly defend against the lawsuits” and is confident in its compliance with Medicare program requirements. “Our policies and practices represent well-reasoned and good-faith interpretations of sometimes vague and incomplete guidance from CMS. For nearly a decade, Kaiser Permanente has achieved consistently strong performance on Risk Adjustment Data Validation audits conducted by CMS. With such a strong track record with CMS, we are disappointed the Department of Justice would pursue this path,” stated the not-for-profit insurer.

     Anthem, Inc. and Kroger Health have teamed up to offer a Medicare Advantage plan in 2022, according to HealthPayerIntelligence. The new co-sponsored plan will be offered in the Atlanta, Cincinnati, Louisville, Ky., and southern Virginia regions. Meanwhile, Highmark Blue Cross Blue Shield Delaware said it is partnering with two Delaware-based health systems, ChristianaCare and Bayhealth, to offer an MA product next year. According to AIS’s Directory of Health Plans, just 93 of Highmark’s 235,382 MA members reside in Delaware, so the new offering stands to grow the insurer’s presence significantly.

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