CMS' Recent Enforcement Actions Show Agency Means Business in 2017
As we predicted, the Centers for Medicare & Medicaid Services (CMS) is off to an aggressive start on the compliance front in the last year of this administration and shows no signs of slowing down with $832,250 worth of fines levied in the month of February alone. The list of enforcement actions released comes with even graver announcements of two immediate suspensions of enrollment and marketing for the year. These fines augment two huge penalties with which CMS closed out last year − $3.1 million and $1.3 million.
In recent news, CMS did announce it will revise its policy of automatically reducing the Star Rating of sanctioned contracts to 2.5 stars. Effective immediately, CMS will suspend this policy, and will re-examine its approach in the 2018 Call Letter. This is a bit of good news for plans currently suspended from marketing and enrollment activities.
From the Medicare Advantage (MA) Advance Notice and Call Letter, we glean further insight into CMS' agenda for 2016. CMS stressed its commitment to improving beneficiary protections for 2016. CMS stressed its plan to increase severity of compliance and enforcement actions in Parts C and D. Particularly, CMS pointed out their commitment to increase the severity of compliance and enforcement actions for Part D auto-forwarded cases, as they saw no significant reduction in the volume of Part D auto-forwarded coverage determinations and redeterminations in the past several years, despite continued warnings issued to organizations. CMS' warning also extends to audits and enforcement actions in network adequacy, provider directory adequacy, and medication therapy management programs.
Given this strong warning, it is no surprise most of the civil money penalties (CMPs) levied in February were due to audits of benefit administration in Part D which showed "inappropriate delays of Part D benefits and increased out-of-pocket costs." Several fines were also levied on Part C appeals and grievances and benefit administration.
Enhancing its theme of focusing on getting plans to tighten up their compliance programs, CMS will issue a memo of their interpretation of methodology for CMPs given the large amount of questions CMS receives related to CMP calculations, not so coincidentally, right before an audit.
CMS has also added a new avenue for enforcement actions — one-third financial audits. CMS is required to conduct these audits for 30% of MA plans each year and has announced they will move to include these in enforcement actions, including CMPs and sanctions, and not just corrective action plans.
If you think 2015 was bad with over $13 million in fines, 2016 is poised to be a record year for enforcement actions. If you're not ready yet, now is the time to cross your t's and dot your i's and get your compliance program in order and prepared for what is positioned to be a busy year.
Resources
GHG's renowned team of experts collaborated to provide the key features and implications of the 2017 Advance notice and Draft Call Letter for your organization in 2017 and beyond. Download our full summary and analysis >>
For actionable advice and best practices, join us at our annual Gorman Health Group 2016 Forum, April 19-20, at the Worthington Renaissance Fort Worth Hotel in Fort Worth, Texas. During this year's information-packed two days, our elite team of experts, operators, clients, and partners will help you figure out what matters and what doesn't. We will share proven tactics to cut costs, increase member satisfaction, and manage and drive sustainable growth. Register now >>
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Operations Mistakes Will Be Costly — Highlights of the 2017 Draft Call Letter
There was a time when operational areas were shooting for 98% accuracy as the "golden" number. In today's age of data and focused audits, even 99% may not be enough. The Call Letter doesn't have many surprising new risk areas for Operations. No new crazy regulations to ponder how we can possibly implement them. Instead, they have something worse: the addition of teeth to the new regulations. Why is this worse? Because the focus is on areas Operations and plans often struggle with and eventually accept status quo as good enough. How many times have you heard or possibly said, "What are our peers doing?" and used them as the measuring stick.
Some of the key focuses to keep operational eyes on are:
- One-Third Financial Audit Results — Don't skip this section thinking this is Finance and doesn't involve Operations. One-third financial audits are full of operational reviews with direct member impact. The Draft Call Letter is indicating, beginning with 2017, one-third financial audits for plan year 2015 will have potential enforcement action like civil money penalties (CMPs) assessed for findings with adverse beneficiary impact. The Centers for Medicare & Medicaid Services (CMS) specifically calls out increased or incorrect cost-sharing or copayments as items of concern. Reviewing your benefit setup and claims processing to ensure controls are in place for adequate application of copays is a fundamental process but one in which CMS is seeing discrepancies year after year. Plans should review their controls or Medicare Secondary Payer (MSP) processes, their provider fee schedule process, and their benefit setup processes to ensure beneficiaries are protected and benefit designs are operationalized each year as filed with CMS.
- Timely Processing of Coverage Determinations and Redeterminations — Your plan may delegate coverage determinations and possibly redeterminations, but whether delegated or processed in house, the plan is responsible. CMS is seeing a continued high volume of auto-forwards of coverage determinations and redeterminations to the Independent Review Entity (IRE) when these functions are not processed within required time frames. CMS is indicating they will be taking action against plans with high volumes—no waiting for an audit and a review of the results. CMS has the data to know there is a problem. Have you looked at your numbers? Do you know your auto-forward volumes? Better yet, do you know the root causes and mitigations to ensure there are no auto-forwards and no negative beneficiary impact?
- Data Integrity — Once again a misleading title that has big operational impacts. CMS is raising concerns CMS program audits are identifying issues that may impact Star Ratings data used for Star Ratings. CMS is indicating they are looking at tying audit findings to data submitted for Part C and Part D reporting and Star Ratings where the audit may have raised concerns. CMS is indicating finding issues within other reviews, such as program audits, may result in review of submitted data for Star Ratings. They are right—it is a holistic approach health plans should be using to get ahead of this curve. If during an internal audit at the health plan a finding occurred indicating grievances were under-reported, is there follow-through to reconcile that under-reporting and revise Part C and Part D grievance reports? In our often-siloed departments and processes, that type of follow through doesn't often occur.
We are all busy. Few of us in Operations have the luxury of focusing on one product or function. We are all trying to keep multiple balls in the air. But if we don't take time to evaluate, stabilize, and set up good controls, we won't survive unscathed. The last thing any of us want is an enforcement action that will take time and energy to resolve and will ultimately impact our members, resulting in most or all of the balls crashing down. Our multi-disciplinary team of consultants has been in your shoes—we have juggled the same balls and are ready to partner with you. Contact us to get started >>
Resources
For actionable advice and best practices, join us at our annual Gorman Health Group 2016 Forum, April 19-20, at the Worthington Renaissance Fort Worth Hotel in Fort Worth, Texas. During this year's information-packed two days, our elite team of experts, operators, clients, and partners will help you figure out what matters and what doesn't. We will share proven tactics to cut costs, increase member satisfaction, and manage and drive sustainable growth. Register now >>
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The Good, the Bad, and the Ugly!
Regarding the New Proposed Medicare Marketing Guidelines (MMG)
Taking a quick read of the proposed 2017 MMG, our marketing team had some initial thoughts about the proposed changes we would like to share.
The Good
- It's only February, and we have the proposed 2017 MMG. This is great for us "Marketers" since we can plan now and won't get sucker-punched at the last moment with changes we weren't expecting.
- The proposed MMG state you no longer have to put the disclaimer about "Availability of Non-English Translations" on print ads and postcards except in the language in which the ad is printed. With so little space to work with on ads and postcards, this change is very welcome.
- Although already released in previous guidance, CMS now includes the following key provider directory updates in the MMG:
- CMS includes more specific guidance on timely updating of directories. Hard copy directories are proposed to be updated monthly; using addendums for the updates is acceptable. Online directories are expected to be completed within 30 days of notification. Although updating directories monthly or within 30 days is very difficult, it is better than real time, which was stated last year.
- CMS states all providers and/or pharmacies represented in the directory have a current contract in effect to participate in a Plan's network. At a minimum, any provider and/or pharmacy listed in the hard copy or online directory for the upcoming plan year should have a contract in effect for the first full month of the plan year. This greatly helps those of us in Marketing and Sales as nothing derails a sale better than stating a provider is in the network only to find out later the provider is not in the network.
- Last year the MMG stated Plans needed to contact their providers on a monthly basis to update their information. CMS has updated the previous language to state the provider contact is required quarterly.
- CMS is clarifying when it is acceptable to use the term "free" in marketing materials. CMS states the term "free" may be used when describing mandatory supplemental benefits that are provided at $0 cost sharing for all enrollees.
The Bad
- Unfortunately, CMS has also proposed Plans cannot use the term "free" to describe $0 premium plans, Part B premium buy-downs, low-income subsidy, or dual-eligibility.
- CMS has clarified guidance from last year to state if an agent is conducting a one-on-one appointment telephonically, the agent must follow the Scope of Appointment guidance.
The Ugly
- CMS includes language stating it will no longer generate Summaries of Benefits (SBs), and Plans will be required to develop their SBs based on their bid data in the Health Plan Management System (HPMS) and required data elements provided in an SB guidance memo. First-year changes like this are always ugly since there are always interpretation issues, and timing on these documents is already tight. However, we fully expect CMS to provide additional guidance around the implementation of this change in the months to come.
Not a BIG deal but Worth Mentioning:
- There is a proposed fifth mailing statement to be utilized for the Annual Notice of Changes (ANOC) mailing only: "Important information about the changes to your Medicare drug and health plan."
- CMS has included what they stated in a memo last year: the ANOC/Evidence of Coverage (EOC), directories, formulary, Utilization Management documents, and Multi-Language Insert must be on the website by September 30, with some exceptions.
Changes to the MMG are never wanted, unless it makes our lives easier, but having a "heads up" related to potential changes in February is a great way to get started for the upcoming Annual Election Period―thank you, CMS!
Resources
Gorman Health Group's marketing experts have developed strategic plans for hundreds of Medicare Advantage Plans, Prescription Drug Plans, Special Needs Plans and Exchange participants. We will work with you to understand your market, mining demographic data for opportunity and finding the gaps in the competitive field into which your plan can fit. Visit our website to learn more >>
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There's a Lot to Like and to Fear in the 2017 Medicare Advantage Call Letter
On Friday after the close, the Centers for Medicare & Medicaid Services (CMS) released the 2017 Medicare Advantage (MA) Call Letter with proposed policy and payment changes. There's a lot to like — and much to fear. On payments, CMS came in with higher-than-expected rates that make clear the long walk in the desert from cuts in the Affordable Care Act (ACA) is over. But on compliance, they are rolling out the firing squad with a broad mandate, and the Administration will leave its mark long after Obama has left office.
What We Like:
- The draft offers all-in rates of +1.35% and a trend of +3.05%, better than last year and better than expected.
- CMS is leaving home visits for MA risk adjustment untouched. If ever CMS was going to clamp down on this after years of threats, this was the time — in the last year of the Administration. By not doing so, we think they're closing the book, acknowledging much good also comes from these house calls, and the home is the most underutilized source of care in the delivery system for seniors. Despite MedPAC recommendations and a drumbeat of op-eds, CMS didn't want to throw the baby out with the bathwater.
- There are big proposed changes to risk adjustment and Star Ratingsfor MA plans serving dual eligibles.
- CMS would launch a new payment system with six subcategories: full duals, partial duals, and non-duals, for both aged and disabled beneficiaries. The net effect is like a crude, mega-risk adjuster, paying plans with more duals bigger, more accurate payments, while paying slightly less to plans with fewer duals.
- On Star Ratings, CMS is proposing an adjustment on three key measures — the overall plan rating, and Part C and D summary ratings — which will increase ratings for plans with higher proportions of duals and could increase bonus payments if the plan is 4+ stars. This is a big win for the industry.
- The health insurer issuer tax has been suspended for a year (and will return in 2018).
What We're Worried About:
- The rapid acceleration from 10% to 50% encounter data driving risk adjustment could depress risk scores. It's clear CMS is moving to 100% encounter data as quickly as possible and likely presages the use of encounters and not Fee-for-Service (FFS) claims to calculate risk factors as well as the phase-out of the coding intensity adjustment.
- CMS is proposing changes for Employer Group Waiver Plans (EGWPs) that amount to a "tax" on sponsors designed to reduce Medicare's spend on these 3 million of the 18 million beneficiaries in MA. EGWPs typically bid much higher than individual MA plans, and the proposal will likely result in a cost-shift to group members or a reduction in supplemental benefits. There was no estimated impact given, so watch this closely.
- CMS made it clear Star Ratings low performers will be executed by firing squad as early as next week. The Call Letter states plans rated below 3 stars for 3 consecutive years will be terminated in February 2016 for a December 31 effective date. Three to six plans qualify for termination. This will be the timeline for future years, and CMS states these decisions are non-negotiable.
- Huge news here on the compliance front:
- CMS notified Part D sponsors it's stepping up enforcement actions on coverage disputes and complaints, the leading noncompliance issue for plans.
- Plans failing the financial audits conducted on one-third of plans each year will no longer be subject to corrective action plans but rather sanctions and civil monetary penalties.
- CMS is ramping up audits and enforcement actions in network adequacy, provider directory accuracy, and medication therapy management programs.
As always, we now enter the frenzied public comment/lobbying phase where the industry tries to get an even better deal, with the final policies announced April 4. As these things go, MA plans should be generally happy about the financial picture while getting down to the busy work of getting the compliance house in order. Most of what's proposed here, we think, becomes the "new normal" long after Obama has left office.
Resources
Join John Gorman, GHG Executive Chairman, and colleagues, Olga Walther, Senior Legislative & Policy Advisor, and Leslie Mullins, GHG's Senior Consultant, as they provide a hard-hitting analysis of critical areas addressed in the document. Learn what the proposed "methodology changes" could mean for your organization and its partners, and the steps you can take to soften the impact on Tuesday, March 1 from 2:30-3:30 pm ET. Register now >>
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Sales 2017 Readiness — Are You Maximizing Your Sales Potential Today?
Here we go again, planning for the upcoming selling season. Every year it seems to approach more quickly than the year before. Are you ready? If the answer is no, or you are not sure, here are a few critical items to consider as you create your 2017 Annual Election Period (AEP) strategy:
- Market Analysis — What worked during AEP 2016? This is the time to reflect on strategies which helped and/or hindered your success from the previous year. While it's fresh in your mind, create a market analysis to review all the components of your sales process. From material distribution to product design, it's important to understand what components of your strategy worked and what needs to be adjusted.
- Channel Mix — Do you have the right mix of agents to represent your plan? It's important to evaluate the effectiveness of both your internal and external sales forces. The industry is moving toward a more diverse distribution channel. The need for internal and external field agents, coupled with telesales, helps maximize your footprint and reach all corners of your market.
- Seminar Plan Development — Did the materials you provided keep your agents compliant during their presentations? CMS secret shoppers are out in full force, and having the right tools for your agents will be imperative to high Star Ratings. In addition, baby boomers are also forcing us to rethink how we present products to Medicare beneficiaries. With the growth of internet shopping, online enrollment presentation opportunities must be included as a part of your strategy.
- Marketing — Did your direct mail make the phones ring, or did your marketing miss the mark? How you implement your marketing strategy impacts lead flow, brand awareness, and enrollment. Successful marketing programs deploy a multi-touch communication strategy which blends education, lead generation, and conversation tactics to maximize new member acquisition.
- Sales Training — Was your sales force ready to sell your plan? Sales training is a critical part of plan and agent success. Create a curriculum which encompasses sales and product training, time management, Medicare basics, and compliance. Don't forget to teach them about member retention―it's hard enough to acquire new members, so you also need to know how to retain them. Enable your agents to start the season with all the knowledge needed to make that sale and keep that new member on the books.
With the narrowed time frame for AEP, your sales strategy must continually change to adjust to the Medicare climate. What worked last year may not work this year. Don't delay, the time is now―start planning for your success today!
For more information, please contact Carrie Barker-Settles at cbarkersettles@ghgadvisors.com.
Resources
Gorman Health Group's marketing experts have developed strategic plans for hundreds of Medicare Advantage Plans, Prescription Drug Plans, Special Needs Plans and Exchange participants. We will work with you to understand your market, mining demographic data for opportunity and finding the gaps in the competitive field into which your plan can fit. Visit our website to learn more >>
Register your team now through January 31 for the 2016 GHG Forum, and take advantage of our New Year's special! Save 15% using promo code NewYear16 at checkout. Register now >>
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AEP Is Winding Down, But Your Work Is Not Over!
As the Annual Election Period (AEP) begins to wind down, you have a pretty good idea of where you will end up this AEP. Whether you knocked the socks off your competition or missed your goals, now is the best time to assess your marketing and sales strategies in preparation for 2017!
Typically, we all have to perform an analysis for senior management showing where the leads and sales came from and what the costs per lead and sale were. Based on that information, we want to understand what changes need to be made or tested for next AEP to increase lead generation and decrease the cost per lead or sale.
But that shouldn't be the end of the analysis — now is the time to do the following:
- Conduct an AEP Process Analysis — From an operational perspective, what went right and what didn't go as well as expected? Were there reprints? What were the call center stats — were they better or worse than last year? From an operational perspective, what would we like to change from this year to the next? What do we have to do internally/externally to accomplish that?
- Vendor Assessment — What vendors over-performed or performed as expected? Do vendors need to be replaced? If so, the Request for Proposal (RFP) process should probably be completed by the end of the first quarter.
- Review Competitive Creative — There is nothing wrong with understanding what competitors are doing and seeing where you might need to strengthen your own creative in the next year.
- Review the sales distribution strategy to understand where the sales opportunities may have been missed and where they were most successful.
- Deep-dive Evaluation of Lead Generation to Member Onboarding — Since now is the time when we really remember all of the pain points and accomplishments, we want to document them to ensure we make changes where needed and expand the successes.
- Look back at the work plan/tactical execution plan to understand where more time is needed next year for a better execution come AEP.
Based on our experience, now is the time to conduct the assessment — before everyone has forgotten what needs to change and before the frustration of a missed date or opportunity becomes a distant memory. Gorman Health Group (GHG) has helped several organizations with this type of assessment — to provide that outside-in perspective which is honest and non-partisan.
Have questions? Contact GHG at ghg@ghgadvisors.com.
Resources
Gorman Health Group's marketing experts have developed strategic plans for hundreds of Medicare Advantage Plans. We will position you for the challenges — and opportunities — posed by health reform, designing a strategy that takes into account your service area, market environment, core competencies, and vision of the future. Visit our website to learn more >>
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A New Report by Kaiser Family Foundation Found Part D Premiums Will Rise an Average of 13% in 2016
We blogged earlier this month about Medicare Advantage (MA) premiums showing slight decreases to no decreases across the board for 2016 based on the Centers for Medicare & Medicaid Services (CMS) estimates. But what does the landscape look like for Part D?
CMS stated in a September 2015 article, "Premiums in the Medicare Prescription Drug Program (Part D) will [also] be stable next year." Earlier this year, CMS announced the average basic Medicare prescription drug plan premium in 2016 is projected to remain stable at $32.50 per month.1 CMS' Part D average premium estimates include both Medicare Advantage Prescription Drug plans (MA-PDs) and Prescription Drug Plans (PDPs). If we carve out PDPs from the Part D premium average reported by CMS in September, data shows, for most PDP enrollees, premiums are projected to be higher in 2016 than in 2015, and many will also see higher deductibles and more cost-sharing tiers with coinsurance.2 As cited in a recent Kaiser Family Foundation study on Medicare Part D plan offerings for 2016, the average PDP premium is projected to increase by 13 percent from 2015 to 2016, from $36.68 to $41.46 per month. When looking at the $0 premium PDP options, low-income subsidy (LIS) enrollees will have fewer to choose from. This means either plan reassignment or beneficiary plan switches will occur for beneficiaries to continue without a premium.
What will this mean for MA plans offering Part D coverage in 2016? Increased 2016 PDP premiums may contribute to a potential shift in membership from PDPs to MA-PDs this Annual Election Period (AEP). Leveraging this opportunity will require time investment from MA-PDs, educating beneficiaries on how making plan changes could lead to beneficiary cost savings and still meet their Part D coverage needs.
"Premium" may be the first category beneficiaries are looking at, but it is not the only thing beneficiaries consider when comparing Part D options. The entire point of AEP is to offer Medicare beneficiaries the opportunity to evaluate their plan options and choose a plan which best meets their needs. This means, in addition to premiums, beneficiaries are looking at deductibles, cost-sharing, formularies, and network pharmacies.
In 2016, 84 percent of PDPs will use tiered pharmacy networks, with lower cost-sharing in selected network pharmacies and higher cost-sharing in other network pharmacies. Two-thirds of all PDPs will have deductibles, with a growing share of PDPs imposing the maximum deductible allowed by law, which increased from $320 in 2015 to $360 in 2016, the largest increase in the deductible since the start of the program.2
Now that the cards are on the table, your immediate strategy, as well as that for next AEP, should be examined. Are you at risk for losing members to competition due to pricing increases? Are your retention efforts aligned to address this issue? Have you identified opportunities to gain membership and benefit from your competitors' increases?
Have questions or need information? Contact me directly at nlennig@ghgadvisors.com or Charro Knight-Lilly, Senior Vice President of Client Services, at cknightlilly@ghgadvisors.com.
1 CMS, "Medicare Prescription Drug Premiums Projected to Remain Stable" available at https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2015-Press-releases-items/2015-07-29.html.
2 Oct. 13, 2015 | Jack Hoadley, Juliette Cubanski, and Tricia Neuman, Medicare Part D: A First Look at Plan Offerings in 2016, http://files.kff.org/attachment/issue-brief-medicare-part-d-a-first-look-at-plan-offerings-in-2016
Resources
The Medicare Advantage marketplace is evolving — are you prepared? Gorman Health Group's marketing experts have developed strategic plans for hundreds of Medicare Advantage Plans, Prescription Drug Plans, Special Needs Plans and Exchange participants. We will work with you to understand your market, mining demographic data for opportunity and finding the gaps in the competitive field into which your plan can fit. Visit our website to learn more >>
Registration for the GHG 2016 Forum is now open! This year we are offering a tiered pricing schedule. Register between now and November 30 to receive the biggest savings at $795. Come December 1, the price increases to $1,095.Register today >>
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The 2016 Star Ratings: Finding Calm in the Chaos
All great changes are preceded by chaos, and the Centers for Medicare & Medicaid Services (CMS) release last week of the 2016 Star Ratings certainly introduced a great deal of chaos for Star Ratings teams throughout the industry. With approximately 5% of additional reimbursement tied to ≥4-Star performance, health plan leaders are either taking a deep breath this week (if they earned ≥4 Stars and qualified for Quality Bonus Payments) or doing their best to quell the inevitable panic if the 4th Star eluded them.
CMS continues to leverage Star Ratings to support improvements in member perceptions and longer-term, sustainable improvements in health plan performance and health outcomes. CMS continues to make rapid, continuous changes among measures, cut points, and program criteria. The speed and extent of change reinforces the need for a seasoned, dedicated Star Ratings leadership team which embraces and manages Star Ratings as a holistic, silo-busting program. It's vital for health plans to simultaneously excel not only in their clinical and pharmacy quality functions but also in every other health plan function. This includes everything from care coordination, network operations, member experience, risk adjustment, appeals and grievances, and compliance, to claims and encounter data and analytics, marketing, and every other department in the organization.
As we adapt to the first Star Ratings cycle with no predetermined thresholds, it's clear there is very little low-hanging fruit left in the Star Ratings program. It's time for us to climb the tree.
With budget season upon us, it is an ideal time to evaluate Star Ratings strategies and work plans to ensure 2017 investments are wisely made. Now that the 2016 Star Ratings are out, take an objective look at your Star Ratings programs to ask:
- Are we investing adequately in the areas where we need the most Star Ratings lift?
- Will our Star Ratings initiatives achieve our goals?
- Are we conducting the right interventions, with the right members, at the right time?
- Are we adequately integrating medication management and behavioral health into our Star Ratings programs?
- Are we adequately coordinating provider and member engagement activities?
- Are our provider contracts and pay-for-quality programs designed adequately to sustain success in the new Star Ratings environment?
If your plan achieved 4 Stars this year, this is no time to rest. The 178 plans at 3 or 3.5 Stars in 2016 are working hard to achieve 4 Stars this year, and with CMS' bell curve, this means some of the current 4-Star plans will drop in 2017. And don't forget — there are another 188 Medicare Advantage plans not rated in 2016. This huge group of plans will impact the bell curve as they receive their first ratings.
If your plan missed a 4-Star Rating this year, now is not the time to panic. There is still time to influence your 2017 Star Ratings, particularly since the Consumer Assessment of Healthcare Providers and Systems (CAHPS®) and Health Outcomes Survey (HOS) surveys will not be fielded until early 2017. But since time is definitely of the essence, it is important to invest time and resources wisely into the areas with the greatest opportunity for short-term improvements.
We can help. Gorman Health Group understands the complexities and nuances of the Star Ratings program and measures. We know how to design programs, initiatives, and tactics to improve Star Ratings performance. From evaluating organizational strategy to developing and optimizing tactical Star Ratings work plans, our team of experts has a long history of success helping health plans achieve Star Ratings success.
With time waning to influence the 2017 Star Ratings, find calm amidst the chaos and prepare for the great changes to come.
Resources
Registration for the GHG 2016 Forum is now open! This year we are offering a tiered pricing schedule. Register between now and November 30 to receive the biggest savings at $795. Come December 1, the price increases to $1,095. Register today >>
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Where did your organization fall with CMS' estimates for 2016 & what's next?
In September, the Centers for Medicare & Medicaid Services (CMS) estimated the average Medicare Advantage (MA) premium will decrease by $0.31 next year, from $32.91 on average in 2015 to $32.60 in 2016. The majority of MA enrollees (59 percent) will face no premium increase. Sounds great, but the reality is most MA and Part D plan sponsors are finding it more challenging than ever to keep premiums low and still maintain attractive benefit packages and viable business/financial models. $0 premium plans in some markets are now the anomaly. Do you keep premiums low, pare down supplemental benefits, and increase copays, or take the hit for another year and hang on, hoping you will make up the financial loss next year or when those risk adjustment scores and Star Ratings align?
According to CMS, about 65 percent of MA enrollees are currently enrolled in plans with 4 or more Stars for 2016, a significant increase from an estimated 17 percent of enrollees in such plans in 2009.
So, the question is, where did your organization fall with CMS' estimates for 2016? Now that competitive premium and benefit information are available for review, I am sure your organization is among the many updating competitive analyses to see what the real situation is. If not, you need to. "Gorman Health Group (GHG) receives a number of requests for benefit analyses as soon as benefits are publicly released," stated Charro Knight-Lilly, Senior Vice President of Client Services. "It is truly the only way an organization can understand their benefit differentials and make the appropriate changes to marketing and sales strategies."
So what's next? For the short-term, it is time to pull your Sales and Marketing teams back together to review where you actually fall in line for 2016 against your competitors and refine or, in some cases, rework the strategies put in place based on competitive assumptions. Ask yourself:
- Will my marketing dollar garner the projected return on investment under our original strategy, or should I shift my dollar spend?
- Should my messaging change based on competitive product and benefit differentials?
- Should my sales distribution strategy change in order to meet close ratios?
With the Annual Election Period (AEP) for Medicare health and drug plans now underway, there is no time to lose.
Have questions or need information? Contact Charro Knight-Lilly, Senior Vice President of Client Services at cknightlilly@ghgadvisors.com, or contact me directly at nlennig@ghgadvisors.com.
Resources
Design and implement a comprehensive data analysis to guarantee you have the right products, programs, and capabilities in place to compete and ensure you are go-to-market ready. Contact us to learn more >>
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Do More Than Survive AEP
How quickly another Annual Election Period (AEP) is upon us. This time of year is the perfect time to review your new member onboarding activities and AEP strategy. We all know the sale doesn't end when the application is turned in and membership begins. This is where the rubber hits the road.
These are the four questions to consider going into AEP:
- Are all plan resource documents updated with the 2016 plan benefits? Picture this: A friend newly eligible for Medicare recently enrolled in a Medicare Advantage plan. He experienced a benefit problem that nearly ended in a sales allegation all because a representative was relying on outdated benefit information. This would have been avoided if everyone at the plan had the new benefit designs.
- Does health plan staff see the big picture? It's easy for us to focus on our individual operational components. After all, the number of regulations and processes to manage a compliant Operations Department is significant and takes our full attention, but the big picture allows for cohesive programs and the ability to see what part we play. Does Enrollment know the top issues that Reconciliation experiences? Is there a feedback loop established to catch improvement opportunities early as we move into AEP? Has Sales shared the advertising schedule and advertisements with Customer Service? Customer Service can maintain that strategy and answer member questions about the campaigns for 2016.
- Are operational oversight tools in place? Not only should all operational staff know the requirements governing their processes, they should know how to tell they are meeting those requirements. The ability to oversee our own processes and know we are in compliance is empowering. Not only can corrections occur immediately, but staff can be confident and efficient, focusing on the important actions supporting new and existing members.
- Is everyone focused on the goal — ensuring a positive member experience? If applications are incomplete, is the Enrollment staff focused on sending a letter to get the application off their plate or focused on reaching out to the member to complete the member enrollment? Are welcome calls in place to answer any lingering questions and ensure new members feel confident and engaged in their plan choice?
AEP was quick to arrive—it will be equally quick to come to an end. Make sure it's the AEP you designed rather than the AEP you survived.
Resources
In Operations, we naturally focus on our own internal processes and efficiencies, but now is the time to invest in making sure staff knows how their contributions impact members and the health plan. Gorman Health Group's experienced Operations team can work with you to set up strategic, efficient, and knowledgeable operations. We've been in your shoes and know how to navigate through AEP. Visit our website to learn more >>
Join us on Friday, October 9, from 1-2 pm ET, as John Gorman, Founder & Executive Chairman at Gorman Health Group (GHG), examines the state of government healthcare programs and outlines proven tactics market leaders are implementing to cut costs, increase member satisfaction, and drive sustainable growth. Register now >>
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