So, what does “Unreasonable Delay" really mean in Federally Facilitated Marketplaces?
As expected, CMS has been sending correction notices to health plans about their networks. Also, as expected, some plans have received a second rejection of their response to the first rejection. Now, time is limited since final corrections are due by September 4. Health plans are asking CMS to give them some idea about how to meet CMS expectations.
Plans are asking—
- What standards does CMS use that makes for a rejection?
- What do we need to do?
- What exactly is deficient?
Given the short timeline, most of these plans are asking "how can we know when we jumped high enough?"
Currently, there are no reasonable standards that CMS or plans can look to. CMS responses to these questions remain vague and unspecific as plans complain that the rejection notices give no direction on what is really wrong. Instead, CMS wants plans to respond with another narrative that explains the pattern of care, any extenuating circumstances, or even a confession of network complaints. Health plans aren't feeling too comfortable with CMS' responses. They are still not sure they will get a "pass" with the next and final submission. Given that multiple CMS reviewers can result in varying opinions on what is sufficient, health plans are worried about the final CMS judgments.
At the same time, CMS assumed responsibility for assuring network adequacy when they initiated these reviews for 2015. So, the focus on narrow networks has placed CMS in the cross-hairs again if network complaints re-surface.
While CMS acknowledged that there might be another window after September 4th, at this point, plans should use metrics using technology support to make their case to support the narrative. Numbers and metrics plus persistence may count.
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The Medicare ACO Demos Are a Mess. Here's What it Means for Health Plans.
This week, another Medicare Pioneer Accountable Care Organization Demonstration site, longtime GHG client Sharp Healthcare in San Diego announced it was dropping out. It was the tenth Pioneer to quit the trail, and not for lack of trying. Many of the Pioneers did great on improving quality and reducing costs -- the issue is not the performance of Pioneers. It's CMS' methodology, with its requirement for Pioneers to bear risk in the third year, and benchmarks calculated to make any gainsharing impossible.
The deck was stacked against them from the beginning, including inability to control beneficiary out-migration, inability to generate meaningful savings if the network was already highly efficient, and the beneficiary at-will opt-out. It's left dozens of Medicare ACOs in both Pioneer and the more than 330 in the Medicare Shared Savings Program (MSSP) scratching their heads and wondering how to monetize the millions they've invested in population health and complex case management -- the "hard part" of Medicare managed care.
I think many will conclude it's time to move up the food chain and become Medicare Advantage plans, and we'll start seeing them next year, with a mini-surge to follow in 2016 and 2017. Look at it this way: Even if only 10% of all Medicare ACOs decide to jump into the elder insurance game, we could be talking as many as 40 new Medicare Advantage plans entering the program over the next three years. All of them local and/or regional powerhouses with loyal followings to command those thousands of "assigned" beneficiaries. At a minimum, a Medicare Advantage contract of their own would command big leverage in negotiations with competing plans they may already be in business with.
To participate in Pioneer or MSSP, health systems needed to develop sophisticated reporting structures to meet CMS demands, as well as the significant investments needed to better manage their elderly frequent flyers. They assembled more integrated, coordinated providers and held them to tough quality standards, and for the most part, they delivered. But for all the hard work of evolving their delivery systems, most -- we estimate as many as three-quarters -- won't see a penny from either demonstration.
Many of these ACOs will look at the health plans they contract with in Medicare Advantage, flip the model on its head, engage the plan or a vendor like TMG Health to operate "back office" insurance functions like enrollment, and enter the market in 2016 or 2017 as private-label senior plans.
They'll have a great story to tell, loyal followings, brand recognition, and -- hugely -- will enter Medicare Advantage with the newbie default 3.5 Star Rating, including the 3.5% bonus. And let's not forget 2016 and 2017 are when the worst is over in the Medicare Advantage rate cuts from the Affordable Care Act, with MA benchmarks being pegged at the traditional Medicare growth rate. These two factors, not to mention a health system's inherent advantage in collecting risk adjustment diagnostic codes, should provide a substantial tailwind to these new entrants. Disappointed Medicare ACOs will reinvent themselves as MA plans making an entrance in 2016-2017 like Beyoncé at the Video Music Awards.
This mini-surge of provider-sponsored MA plans should be considered by many sectors of our industry, from provider relations execs and health plan strategists, to pharmacy benefit managers and other vendors hunting new prospects. Disruptive events like the Affordable Care Act have ripple effects, and one will be the evolution of ACOs into full-risk insurers seeking to control their own destiny. And we need to look no further than members of the Health Plan Alliance, systems like Geisinger Health Plan, or UPMC, or Security Health Plan to see the impact they can make.
If you're a Medicare Advantage Plan with a Medicare ACO in your neighborhood, or worse in your network, start sleeping with one eye open. It's now time to keep your friends close and your enemies closer.
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Hospice Guidance Turns 180 Degrees
After 70 Senators signed a protest bill and the hue and cry from hospice providers, patients and prescribers got too loud, CMS rescinded its' previous regs for hospice patients and published new guidance on 7-18-14. Previous guidance required health plans to place prior authorization edits on all medications after a member was identified as being a hospice patient. So, all the medications that the member was previously receiving under their Part D benefit were denied at point of sale. This caused a significant hardship to hospice providers who many times had to pay for the hospice member's medications. The philosophical and medical issue continues to be what medications should be continued and which medications should be discontinued when members are in their hospice benefit. Should antihypertensive, antihyperlipidemic, diabetes and other chronic medications be continued for hospice patients? Rational and substantive arguments exist for the continuation of some chemotherapy medications which keep tumor growth in check and are considered to be palliative for some patients.
The new guidelines require plan sponsors to place beneficiary level prior authorization requirements on four categories of prescription drugs:
- Analgesics
- Antinauseants (antiemetics)
- Laxatives
- Antianxiety drugs (anxiolytics)
These categories are assumed to be "related to the terminal illness and/or related conditions". Hospice providers will provide these medications. Plan sponsors are expected to continue to provide other medications which may have CMS approved utilization management edits including quantity limits, step therapy and prior authorization. Retrospective review is expected to determine whether other medications were "unrelated to the hospice beneficiary's terminal illness".
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The Model of Care's Interdisciplinary Care Team
The Centers for Medicare & Medicaid Services (CMS) has outlined expectations for Model of Care (MOC) for Medicare managed care programs. One of the critical elements of the MOC is the Interdisciplinary Care Team (ICT). CMS has placed greater emphasis on outcomes measures and a well-designed ICT can be a success factor in improving the quality of care and service afforded to beneficiaries.
The health plan case manager after initial member assessment is responsible for developing goals / objectives and barriers to improving member health. The case manager is charged with identifying relevant personnel for the ICT that holds accountability for developing a comprehensive Individualized Care Plan (ICP) addressing the beneficiary's particular needs.
The ICT's duty is to review multiple sources of information: health risk assessments (HRA), medical and pharmacy claims, risk profiles, patient goals / objectives and barriers in order to create a robust ICP; in addition to managing the beneficiary's clinical and psychosocial needs and working with the case manager to coordinate the delivery of required services and benefits.
Each ICT is required to update the ICP and define the appropriate frequency of ICP reviews and revisions. It is also responsible for notifying beneficiaries / designees, primary care providers, and relevant specialist(s) of meeting dates. Depending on case volume ICT meetings can vary from weekly, bi-weekly or monthly whichever is relevant to the identified goals and objectives. Each meeting should have a prepared agenda and case summary that's shared with the beneficiary, providers and specialists in advance. Attempts to schedule meeting times that maximize beneficiary and provider participation are beneficial.
Numerous health plans struggle with the formation of an Interdisciplinary Care Team. If you are uncertain or concerned that your plan does not have a solid ICT process or design, GHG can assist you in evaluation and identification to adhere to best practices.
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Health Plan Strategists: Fish Where the Fishes Is -- in LTSS
One of the best pieces of advice I ever got in business was to "fish where the fishes is", and for health plan strategists it holds up. In this Golden Age of Government-sponsored Health Programs, one of the biggest fishing holes is Long-Term Services and Supports, and a new primer from KFF lays out the opportunity beautifully. And the hazards: patients who require LTSS are of course the most vulnerable and complex patients in the entire US health system, literally the final frontier for health plans and coordinated care. Huge risk, huge rewards.
LTSS -- often totally unfamiliar to both Medicare and Medicaid plans, and requiring new types of providers in-network -- help the elderly and disabled with activities of daily living, and include nursing home care, adult day care, transportation, and caregiver supports. As a nation in 2012 we spent $368 billion on LTSS, 40% of that from Medicaid, and 20% from Medicare, and likely to be around $400 billion today. That's way more than what we're spending on ObamaCare's exchanges and subsidies on an annual basis. It's unsustainable already, and is now a top-2 item in most state budgets. And with seniors 85+ now the fastest-growing segment of the US population, and their needing LTSS at four times the rate of their younger cohorts, the urgency to convert these vulnerable patients to a coordinated care environment has never been greater, and it's happening fast.
Most LTSS reforms occurring at the state level involve transitioning frail elders and the disabled from the human warehouses of nursing homes and rehab hospitals to home and community-based settings, often under a capitated financial arrangement. With a year of nursing home care costing $90,000+ but a home health aide or adult day care running about $20,000, it's not hard to see why 45 cash-strapped states are pushing this transition.
The catch is that with the complexity of these populations, and the growing resistance of beneficiary advocates, especially for the developmentally disabled, this transition will involve an unprecedented degree of transparency and accountability from health plans. If you think Medicare Advantage Star Ratings measures are tough, you ain't seen nothin' yet. Many quality standards for the frail and disabled, like provider visit timeliness and drug adherence, haven't even gotten off the drawing board yet, and they often vary by state. What's clear is that service and coordination expectations of regulators will be far more robust for very old and disabled beneficiaries. That means more emphasis on data-driven case management and coordination, in-home and in-community interventions, robust reporting for regulators and actionable clinical intelligence for providers.
So strategists should "fish where the fishes is" and plan to participate in these groundbreaking programs -- but come equipped.
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Navigators, In-Person Assisters and Brokers
The Alliance for Health Reform held a briefing on August 5, 2014 on "Navigating the Health Insurance Landscape: What's Next for Navigators, In-Person Assisters and Brokers?"
Consumer enrollment in Qualified Health Plans (QHPs) offered in the Exchange Marketplaces for 2014 was greatly assisted by Navigators, In-Person Assisters (including Certified Application Counselors) and Brokers. 28,000 navigators and assisters helped 10.6 million consumers during the first ACA open enrollment period. The Kaiser Family Foundation just completed a survey and issued a report entitled "Survey of Health Insurance Marketplace Assister Programs: A First Look under the Affordable Care Act". The survey did not include agents and brokers. The survey reported that there were 4,400 assister programs nationwide. Certified Application Counsellor Programs account for 45 percent of the assister programs, in-person assistance programs were 26 percent, the FQHC share was 26 percent, Navigator programs represented only 2 percent and the Federal Enrollment Assistance program provided only 1 percent.
According to the Kaiser study, the federal government spent over $400 million on these assistance programs during the first year. $100 million came from Exchange establishment grants, $208 million from grants to FQHCs, and $105 million from CMS ACA implementation funds. In addition, there was substantial additional funding from private sources including non-profit community programs, hospitals and health care providers, state and local governments. Funding for assister programs in the state-based marketplaces and federal-state partnership markets was substantially higher than funding in the federal marketplaces. The uneven funding distribution meant that the number of assister staff per 10,000 uninsured was about half in the federal marketplaces.
Assistance was time intensive involving on average one to two hours for each client. The top three reasons consumers sought assistance included their limited understanding of the ACA and the need to understand plan choices and their lack of confidence in applying on their own. Information from QHP websites was inadequate and plans did not have dedicated phone lines for assisters. Assisters faced a number of challenges including lack of health insurance literacy, transportation issues in rural areas and lack of trust in certain hard to reach communities. States had only 10-12 weeks to hire and train most assisters. 92 percent of assisters wanted additional training especially in the areas of subsidies, tax penalties, and immigration issues. Successful techniques in reaching the target uninsured populations included partnership with community agencies, building on Medicaid and CHIP networks, use of mobile navigators and media outreach efforts. Back-end access to Exchange portals in some states, e.g. Maryland and New York greatly helped the assisters with their jobs. States with larger funding were able to conduct more outreach and education events and schedule one on one appointments.
There is no data on the number of agents and brokers that participated in the 2014 open enrollment period. The National Association of Health Underwriters (NAHU) reported high broker interest and their 2013 survey found that almost 75 percent were obtaining marketplace certification. HHS reported that 70,000 agents were certified by the federal marketplaces. State exchange data shows 30,000 additional agents and brokers were certified. The NAHU reported that agent and broker services had an 89 percent customer satisfaction rate. In general, state based exchanges were designed with better broker participation mechanisms than the federal marketplace, although all exchanges experienced technological issues. The level of collaboration between brokers and assisters varied across states. Some assisters were wary of brokers, largely because they received commissions from the plans. Others valued the expertise of the brokers.
90 percent of assister programs reported post-enrollment problems after the ACA open enrollment ended in April. The top problems identified included not receiving an insurance card, Medicaid eligibility determination problems, and failure to receive a premium invoice. Three fourths of the consumers lacked understanding of the basic insurance concepts. About one-third of the enrollees picked the wrong plan, for example because they didn't understand high deductible plans or innovative benefit designs that covered some benefits but not others.
76 percent of the assister programs plan to continue during the second open enrollment. This open enrollment is 50 percent shorter than the first enrollment period and overlaps with tax season. The assisters will also be facing the QHP renewal process as well as uncertainly on the functionality of the online portals. New QHPs will be entering the marketplace. Federal Navigator funding will be $8 million less. States can continue to use their grants for the 2015 enrollment period, but they must be self-supporting in 2016. Additional education will be needed on tax penalties which will be three times larger if consumers don't sign up in 2015.
NAHU expects broker participation in the 2015 open enrollment period to be high, although slightly lower than 2014. A June survey found that 69 percent of brokers plan to sell on the individual exchange in 2015. Brokers see opportunities with new plans entering the marketplace and the availability of the SHOP exchanges. Brokers and agents experienced a number of challenges in 2014 including payment and liability issues resulting from the failure of applications to record multiple assisters. NAHU recommends broker portals, additional fields to record multiple assister numbers on applications, ability to edit enrollment records to add NPNs and addition of a complete list of brokers on HHS.gov.
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Regulatory Oversight of Narrow Network Plans
The Alliance for Health Reform held a meeting that focused on "Network Adequacy: Balancing Cost, Access and Quality" on July 21. The meeting was very well attended for mid-summer, indicating substantial interest in the trend towards smaller networks particularly in qualified health plans offered through the ACA Exchange marketplaces. Several of the panelists mentioned a recent McKinsey study that found that 92 percent of consumers using ACA plans have access to narrow network plans while 90 percent of ACA plans offer broader networks.
The panel participants emphasized the value that smaller networks bring to consumers in offering substantially lower premiums. For example, a recent Milliman report for AHIP found that high value networks can reduce premiums by 5 — 20 percent. However, it is important that plans select the providers based on quality and performance and not just on price. Paul Ginsberg pointed out that smaller networks also can support integration of care and that these plans are moving in the same direction as payment reform e.g. making payment based on episodes of care or bundled payment. Katherine Arbuckle from Ascension Health noted that providers in smaller network plans can benefit from being connected to the same electronic health record system which further benefits clinically integrated care.
All of the panelists agreed that there needs to be adequate regulatory oversight of network access. Currently the NAIC is in the process of updating their Model Network Adequacy Act which has not been modified since 1996. The goal is to have an updated model by the end of the year. NAIC is focusing on new provisions on essential community providers, tiered networks, formularies, provider directories and updates, continuity of care and consumer protection from unanticipated bills and broadening the act to all types of managed care plans. NAIC wants to retain state flexibility to deal with local conditions, for example, provider access standards should be very different in Wyoming than Los Angeles. Paul Ginsburg noted that passing any willing provider laws is an overreach and will offset the advantages that smaller networks, carefully chosen, can bring to the marketplace.
NAIC does not have regulatory jurisdiction over Medicare Advantage plans. CMS is considering making changes to MA access standards to deal with mid-year network changes beginning in 2015, for example by allowing enrollees to switch plans if their doctor leaves the network mid-year without cause. Senator Sherrod Brown and Rep. Rosa DeLauro have introduced legislation to prohibit MA plans from dropping physicians mid-year without cause.
Resources
Find out what provisions in the final marketing guidelines will have the greatest impact on your organization and how plan sponsors can prepare for the upcoming changes in a webinar next Wednesday, July 23.
American Action Network Promotes Government Subsidies
The American Action Network (AAN), a 501(c)(4) conservative think tank, has published a report that purports to show that Medicare Advantage (MA) payments will be about 13% less in 2015 than they would have been had the Affordable Care Act not interfered. To get the attention of members of Congress, the report shows the reductions by Congressional district.
The AAN analysis doesn't mention sequestration, which probably accounts for 2% of this 13%. Sequestration of course, has nothing to do with the ACA. Nor do they mention MedPAC's repeated recommendations to Congress to reduce the benchmarks that determine MA payments, so that they equal Medicare's average fee for service (FFS) costs. For example, see MedPAC reports in the period just prior to the passage of the ACA: http://www.medpac.gov/chapters/Jun09_Ch07.pdf and http://www.medpac.gov/documents/Mar10_EntireReport.pdf.
Reducing Medicare Advantage payments to parity with Medicare FFS, as recommended by MedPAC, is the reason for the cuts that the ACA imposes. As usual in Washington, the word "cuts" in this context doesn't mean an absolute reduction, just less than what would have been spent under the old law.
The AAN report does not describe how either the projected 2015 payments or the pre-ACA 2015 payments-that-would-have-been were calculated, so there's no way to comment on the validity of the 13% figure beyond the above observations. By my calculations, the ACA reductions amount to about 9% less than what the average benchmark would have been, before sequestration. With sequestration, I come up with a reduction of 11% relative to the trended pre-ACA benchmark, compared with the AAN's 13%. That figure doesn't take into account any changes in risk adjustment or quality bonuses, which the AAN report claims to include. One would expect risk adjustment to be a net positive, even after the increase in the amount deducted by the coding intensity adjustment, as plans have gotten better at coding. And quality bonuses are also a net positive, even with the end of the Stars demo in 2015. So adding these to the 9% reduction in the published benchmark should produce a smaller reduction, relative to the pre-ACA benchmarks trended forward. So I am skeptical of the 13% figure published by the AAN, without more information regarding how they calculated the 2015 pre and post ACA figures.
However, it is worth noting a couple of consequences of the pre-ACA figures. One is that these additional payments would have been funded, in part, by an increase in all Part B premiums, including those paid by non-MA members. Avoiding this increase is tantamount to a tax cut for Medicare beneficiaries. Yet the conservative AAN, whom I would expect to applaud anything that has the effect of a tax cut, is criticizing this reduction.
The other consequence is that the remainder of the additional payments would have been drawn from public funds. These funds would come either from the Part A trust fund, or from general revenues. The balance in the trust fund is being drawn down each year, since Medicare payroll tax receipts are less than trust fund obligations. Since the money in the trust fund is invested in treasury bonds, the fund gets the cash it needs by cashing in those bonds. To redeem the bonds, the treasury has to issue more debt.
And, since general revenues are less than expenses, the portion paid from general revenues would actually be paid from additional borrowing as well. So, by reducing the amount that would otherwise have been paid to MA plans, the ACA is reducing the net federal debt. The net debt would be the amount of real debt after excluding money the government owes itself (like the trust fund).
Taken together, I would expect a conservative think tank to argue in favor of reducing MA payments, to reduce the Part B premium and to reduce the net federal debt. The AAN position seems like a triumph of politics over policy, where an ostensibly conservative organization is promoting public subsidization of MA because a Democratic Congress took the conservative approach and cut the subsidies.
This report will probably be useful in ginning up some high dudgeon among conservative-leaning seniors whose conservative principles are somewhat plastic when it comes to getting government subsidies. Maybe it will help get out the vote in a few districts, if the target population remembers it come November. Otherwise, I'm not sure what the point of this is.
Resources
Find out what provisions in the final marketing guidelines will have the greatest impact on your organization and how plan sponsors can prepare for the upcoming changes in a webinar next Wednesday, July 23.
It's silly season again, so let's sue the President
The Speaker of the United States House of Representatives, one of the most senior elected officials in the US government, has announced that the House is going to sue the President because he has delayed enforcement of a provision of the 2010 health care law; a provision that a majority of that same House has vociferously criticized as unfair to business and a "job killer." In 2014 Washington, this makes perfect sense.
President Obama has delayed enforcement of the mandate that requires most employers to offer health insurance to their employees, starting in 2014. The President has delayed enforcement until 2015 or 2016 (depending on the size of the employer). The Administration argues that the Internal Revenue Code allows for transitional relief in the implementation of new legislation (the mandate's fee would be collected by the IRS, and so this ostensibly falls under the authority of the Internal Revenue Code). The Speaker says not so much.
So here's the scenario. The employer mandate is set to take full effect by 2016, less than 18 months from now. The House's lawsuit will make its way through the federal court system, with appeals ultimately taking it to the Supreme Court. By then, the mandate will be in full effect, and the Supremes could decide that the case is moot and reject it. Or, even if they decide in favor of the House, there will be no immediate impact since the mandate will already be in effect.
So what's the point? My guess is that the Speaker is hoping to suck some energy from his back benchers who want to impeach the President. Impeachment would fill the newscasts with images of issue conservatives and libertarians competing to load up the articles of impeachment with every criticism of Mr. Obama that has been rendered from the Right since 2009. Having this public spectacle just as voters are going to the polls this November must be one of the Speaker's worst nightmares. So sue the guy. Anyway, it's one of the few things that the GOP majority in the House can accomplish without help from Democrats or concurrence of the Senate.
There is risk for the Speaker in this. He only has a 35 vote majority at present (with 2 vacancies). If half of them vote against the lawsuit, on the grounds it's too wimpy and only impeachment will do, he's going to suffer a major political embarrassment. That's a margin of 18 votes, and 15 members have already voiced support for impeachment.
Even with the Nats in first place in their division, Congress is still the best spectator sport in DC. So pull up your lawn chair, grab a brew, and try to forget for a while that these are the people to whom we have entrusted the governance of our homeland.
Resources
Find out what provisions in the final marketing guidelines will have the greatest impact on your organization and how plan sponsors can prepare for the upcoming changes in a webinar next Wednesday, July 23. Register now >>
Hobby Lobby and Corporate Person-hood
The Supreme Court ruled on Monday, in the Hobby Lobby case, that requiring family-owned corporations to pay for insurance coverage for contraception under the ACA violated a federal law protecting religious freedom. This essentially means that some corporations now have religious rights. Although the majority tried to make this ruling as narrow as possible, it does open the door to future suits claiming exemption from other laws that are deemed by the owners of closely held corporations to infringe on the free exercise of their religion. An initial concern for insurance issuers is whether religious exceptions will proliferate, requiring an increase in benefit design variation. More benefit options means increased operating costs, and more difficult premium calculations.
Beyond this, the logic that a family-owned corporation is indistinguishable from its owners when it comes to religious rights may poke holes in the corporate veil in other ways. Corporations are created by state governments to protect their owners from personal liability. They are fictitious persons, endowed by their creator (the state) with certain specific rights and privileges. The tendency of this Supreme Court to see corporations as extensions of their owners, or of their donors in the Citizens United case, seems to violate this notion of limited rights as well as limited liability, all as determined by state incorporation law. If corporations enjoy freedom of speech and protecting under the federal Religious Freedom Restoration Act, are they also people for purposes of voting and holding public office? Isn't this train of thought leading into some weird and nonsensical places?
Resources
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If you've just submitted your HEDIS data, now is the time to analyze that data for gaps and identify interventions for your health plans, providers and members. On July 17 join John Gorman, Executive Chairman at GHG, Jane Scott, Senior Vice President of Clinical Services and Anita McCreavy, Senior Consultant, for a webinar on HEDIS reporting, the new measures and what's next. Register now >>