MedPAC Report Slammed for Telling Truth About MA Abuses

Regulatory

by | Jan 24, 2024 | Regulatory

Untitled Document

Analysis by Tim Rowan, Editor Emeritus

P

erennial Home Health enemy MedPAC angered a different group last week by releasing a status report on insurance companies participating in the Medicare Advantage program.1

 

The report details the way in which giant, for-profit, health insurance companies improperly increase per-customer payments by upcoding their health assessment at enrollment, and then slash costs by denying coverage for healthcare services that traditional Medicare would have honored. MedPAC was also critical of the practice of requiring prior authorizations, backed up by utilization review algorithms that are supposedly intended to “minimize furnishing unnecessary services” but which effectively increase denials for necessary care.

According to the report, MedPAC expects CMS to pay MA plans $88 billion in 2024. 

On January 12, a meeting to discuss the report ended in what one reporter politely described as “a kerfuffle.” Other witnesses to the meeting chose to describe it as a shouting match.

“One member, Brian Miller, MD, MPH, of Johns Hopkins University in Baltimore, accused panel leadership of issuing a negative status report on MA plans’ market dominance, saying it had been ‘hijacked for partisan political aims to justify a rate cut to Medicare Advantage plans.’

“Miller said the analysis … ‘appears to be slanted to arrive at a foregone conclusion in order to set up and provide political cover’ just before the Centers for Medicare & Medicaid Services prepares its annual rate notice for MA plans, expected in coming weeks. ‘The chapter reads like attack journalism as opposed to balanced and thoughtful policy research.'”2

Report authors fired back, citing numerous ways MA plans generate higher revenue, including enrolling people who are relatively healthy, known as favorable selection. They then vigorously scan patients’ medical histories and charts to code for health factors that generate higher per-capita payments, known as coding intensity, often spending less on services. Coding intensity is also the difference between a risk score that a beneficiary would receive in an MA plan versus in fee-for-service. Though MA plans skew toward healthier enrollees, MedPAC found that MA risk scores are about 20.1% higher than scores would be for the same beneficiaries had they enrolled in Fee For Service Medicare.

 

Namath, Walker, Shatner and Brokers

Criticism of MA plan behavior did not only come from MedPAC commissioners and report authors. For example, Lynn Barr, MPH, founder of Caravan Health, which was acquired by CVS Health through its acquisition of Signify Health, exposed what the annual TV ads do not make clear, that their 800 numbers go to brokers, not to any one plan.

“This is not the big, lovely, glowing success that everybody says it is. And we continue to create policies that drive people into these plans. Medicare allows money paid to MA plans to be used for broker commissions as high as “$600 to recruit them, plus $300 a year every year that they stay in the MA plan.

“We have allowed MA to buy the market, and that is why MA is growing. It’s not because the quality’s so great. People don’t love the prior auth, people are leaving their plans a lot. Aside from Medicaid, Medicare is the least profitable payer for doctors. And at the same time, we give all this money to the plans. It’s unconscionable.”

Adding to the “kerfuffle” with a powerful anecdote, Stacie Dusetzina, PhD, of Vanderbilt University Medical Center in Nashville, Tennessee, noted that even cancer patients often have trouble getting necessary care because of the plans’ limited networks. She referenced a January 7 NPR story3 about an MA enrollee who could not get the cancer care he needed from his MA plan, and could not get out of the plan without facing 20% in expensive copays. In all but four states, supplemental plans that could pick up the difference can reject patients with costly conditions.

“When you are 65 and aging into the program,” Dr. Dusetzina summarized, “you are healthy at that time and may not be thinking about your long-term needs. [If you did], it would push you to think harder about the specialty networks that you may or may not have access to when the MA plan is making your healthcare decisions.”

 

1 A 30-page slide presentation is available to the public at medpac.gov/wp-content/uploads/2023/10/MedPAC-MA-status-report-Jan-2024.pdf. The complete report is available only to MedPAC commissioners. The charts on slides 26 and 27 show how MA plans learned to pad profits in 2018 and increased the practices exponentially since then.

2 Cheryl Clark, MedPage Today January 16, 2024 medpagetoday.com/special-reports/features/108275

3 npr.org/2024/01/07/1223353604/older-americans-say-they-feel-trapped-in-medicare-advantage-plans

 

Tim Rowan

 

Tim Rowan is a 30-year home care technology consultant who co-founded and served as Editor and principal writer of this publication for 25 years. He continues to occasionally contribute news and analysis articles under The Rowan Report’s new ownership. He also continues to work part-time as a Home Care recruiting and retention consultant. RowanResources.com; Tim@RowanResources.com

 

 

©2024 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in Healthcare at Home: The Rowan Report.homecaretechreport.com One copy may be printed for personal use: further reproduction by permission only. editor@homecaretechreport.com

Is There an Answer to Paying for Palliative and Private Care?

Uncategorized

by | Feb 7, 2024 | Uncategorized

By Kristin Rowan, Editor

Last month, we published an article in partnership with Bob Roth of Cypress HomeCare Solutions in Scottsdale, AZ about paying for long-term care at home. Since then, I have come across some interesting information as we continue to tackle the issue of paying for care that is not reimbursed by the current Medicare/Medicaid system.

Medicare and Medicare Advantage have set pay rates for home health and hospice care. Home Health Value-Based Purchasing (HHVBP), implemented by CMS, was designed to incentivize agencies by paying more for quality care rather than a higher number of services provided. This is similar to giving advances and pay raises based on performance rather than longevity in a job, which I’m all for. However, the HHVBP overlooked palliative care altogether and neither the fee-for-service model nor the HHVBP model includes supportive (read private duty) care at home. Since these services are not reimbursed, there is no incentive to provide them nor way to get paid for them if the patient cannot pay out-of-pocket.

This causes two problems:

1. Home Health and Hospice Agencies are reluctant to provide unreimbursed care, with good reason, so the overall patient experience is less than ideal, rehospitalization rates increase, star-ratings and scores decrease, bonuses go away, and the agencies make less money than before.

2. Patients can’t get the care they need and want. Palliative care patients may receive Hospice care too early, or they may not receive care at all because they fall between home health and hospice. Patients who need supportive care at home can’t afford it so they either go without, causing increased complications or they rely on friends and family members who burn out under the stress of being a full-time caregiver.

Innovative care strategies can overcome the obstacles faced by agencies and patients alike. There may not yet be a perfect solution, but there are some innovative ideas out there and something has to disrupt the current pay model.

Palliative Care Partners

Medicare Advantage organizations and primary physician groups receive a “cost of care” analysis for the duration of the patient care. The organization takes on the risk of that patient costing more than what the MA plan will pay, but can make more money if patient care costs less than anticipated. Palliative care at home costs less. David Causby, President and CEO of Gentiva, a Hospice organization that operates in 35 states across the U.S. and has an average daily census of 26,000, has implemented a plan of care in cooperation with these organizations in what he calls Advanced Illness Management (AIM) Model for Risk-Based Partnerships. Designed for palliative care, Gentiva creates a plan of care that includes visit frequency and care needs and employs nurse practitioners, care managers, after hours RNs and social workers. The hospital pays Gentiva on a PMPM model with shared savings. The hospital still gets paid the full amount from MA but uses fewer resources, has lower costs, and sees reduced rehospitalizations, saving more than what they pay out. According to Gentiva, this partnership “provides value to contracted organizations by decreasing the overall end-of-life spend on this high-risk patient population.”

Supportive Care at Home Innovations

Supportive Care at Home (Private Duty Home Care, Private Pay, Non-medical home care) is not covered by Medicare, Medicare Advantage, or most health insurance plans. Limited Medicaid grants, VA plans, and long-term health insurance pay for some supportive care at home. Without one of these plans, patients and family members pay out-of-pocket for supportive care at home, averaging $22-$27 per hour with a 4-hour minimum. In some states it can cost up to $50 per hour. At $80 per day, that’s around $20,000 per year.

One software company we recently spoke with is upending the home care model with fee-for-service model that charges by the minute, rather than by the hour, making care more affordable for more people. You can see our product review of Caring on Demand here. By reducing the cost for customers and reducing the time for caregivers, agencies can onboard more customers without hiring more caregivers. The system is being used in facilities where these services are not provided, which allows a caregiver to visit several people in one stop. The agency and the caregiver can see the same income in the same time, spread out across multiple private payers.

Combining Innovation for a Win-Win-Win

I heard about Caring on Demand and spoke with its founder in August of 2023. I spoke with one Home Care agency owner who recently started working with Caring on Demand. “Times have changed,” the agency owner said. With fewer caregivers joining the workforce, increased levels of burnout since 2020, and CMS changes that overlook palliative and non-medical care, maybe there’s another way…

  • Partnerships with organizations and physician groups that have Medicare, MA, and traditional health insurance patients, non-medical home care agencies, and palliative care providers.
  • Localized groups of patients in limited areas like retirement villages, planned communities, neighborhoods, or small towns.
  • Cost sharing and care coordination that includes in-home palliative care visits, supportive care, communication with primary care providers and specialists
  • Preventative intercessions to avoid unnecessary ER visits and hospitalizations
  • Shorter visits per caregiver with multiple visits to a community each day
  • Cost sharing among patients splitting a 4-hour minimum visit among 4-8 patients
  • Shared savings from reduced hospital stays, shorter durations of hospice care, and nursing visits that are supplemented by supportive care

Gentiva has experienced some success already in using shared savings as a payment model. Can costs be decreased even more by adding supportive home care to this plan? Is there enough shared savings for three payees instead of two? I don’t have the answers to these questions, but I do believe providers of supportive care and palliative care have been in the background, overlooked by CMS and MedPAC for long enough. If they aren’t going to recognize the positive impact and cost savings of home care and palliative care and include them in the reimbursement model, we may have to do it for them.

We’d love to hear your feedback on this and other innovative ways to combat the crisis of paying for care at home.

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Kristin Rowan

Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com

©2024 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in Healthcare at Home: The Rowan Report.homecaretechreport.com One copy may be printed for personal use: further reproduction by permission only. editor@homecaretechreport.com

 

 

MedPAC Exposes More Medicare Advantage Crimes

CMS

by | Mar 20, 2024 | CMS, Editorial

by Tim Rowan, Editor Emeritus

This week, we look at the state of the healthcare industry, vis a vis payers that do not pay.

While Home Health and Hospice leaders talk at every gathering about refusing to accept Medicare Advantage clients, some large Integrated Healthcare Systems are actually doing it. Other hospitals are responding to difficult payers by laying off staff, or even closing. The HHS Office of Inspector General repeatedly fines insurance companies for upcoding to gain inflated, unjustified monthly payments. Meanwhile, insurance companies report record profits, with their MA divisions leading the way. The fines go into the “cost of doing business” column.

March, 2024, Becker’s Hospital Review: Bristol (Conn.) Health will eliminate 60 positions, 21 of which are currently occupied and will result in layoffs at Bristol Hospital. The hospital’s CEO, Kurt Barwis, told a local newspaper a lack of reimbursement from insurers left the hospital without a choice but to cut staff.

October, 2023, NPR: Since 2010, 150 rural hospitals have closed. Under CMS’s “Critical Access” designation, Medicare pays extra to those hospitals to compensate for low patient volumes. MA plans do not. Instead, they offer negotiated rates that are lower than what traditional Medicare would pay.

December, 2023, Becker’s Financial Management: 13 additional hospital systems cut ties with Medicare Advantage plans since October.

What is going on?

The Medicare Payment Advisory Commission, MedPAC, believes it has learned the answer. In its March 15, 2024 report to Congress, the Commission called for a “major overhaul” of Medicare Advantage policies. It says it found that the program, designed to lower costs and extend the lifespan of the Medicare trust fund, does not save money but costs the fund more than if all beneficiaries were on traditional Medicare, $83 billion more in 2024.

Calling it, too politely, “coding intensity,” MedPAC concurs with the OIG that MA plans routinely exaggerate patient conditions. The report claims it will amount to MA clients appearing to need 20% more healthcare than fee-for-service beneficiaries, when they do not. Padded coding, MedPAC says, will increase Medicare premiums by $13 billion in 2024.

“A major overhaul of MA policies is urgently needed for several reasons,” the commission wrote in its report. MedPAC cited several problems that need to be addressed, including the disparity in costs between beneficiaries in fee-for-service Medicare and MA, a lack of information on the use and value of supplemental benefits, and challenges setting benchmark payment rates.

A proposal currently making its way through Congress would reduce supplemental payments to insurers, who threaten to raise premiums and cut benefits if their inflated benchmark payments are lowered.Celebrity Endorsements of Medicare Advantage

“If payments to MA plans were lowered, plans might reduce the supplemental benefits they offer,” MedPAC wrote in its report. “However, because plans use these benefits to attract enrollees, they might respond instead by modifying other aspects of their bids.” The barrage of TV ads, featuring aging celebrities, have been found to be deceptive and too often backed by shady front companies representing brokers, not insurance companies. The brokerage company behind the Joe Namath ads, for example, has reorganized and changed its name three times.

Pushback from AHIP, the insurance industry lobbying organization, has been as expected. “MedPAC’s estimates are based on ‘speculative assumptions’ and ‘overlook basic facts about who Medicare Advantage serves and the value the program provides.'”

MedPAC asserts that its estimates are based on history, not speculation.

Healthcare Providers Beg to Differ

A lack of payments from Medicare Advantage plans is one reason the Connecticut hospital is laying off staff, the Hartford Courant reported March 14. CEO Kurt Barwis told the newspaper Medicare Advantage plans have been denying claims more frequently while delaying payments for the claims they do approve. “Our primary care is to take care of patients, their single focus is shareholder value and profits,” Mr. Barwis told the Courant. “The Medicare Advantage abuse is outrageous.”

The strategy insurance companies deploy to avoid providing care, Barwis continued, is excessive prior authorizations, coupled with delayed payments. This obstacle to care is directly in opposition to CMS policy. MA divisions of large insurers respond that they are private insurance and allowed to impose their own treatment approval policies. MedPAC says this claim is incorrect.

Richard Kronick, a former federal health policy researcher and a professor at the University of California-San Diego, said his analysis of newly released Medicare Advantage billing data estimates that Medicare overpaid the private health plans by more than $106 billion from 2010 through 2019 because of the way the private plans charge for sicker patients. Kronick added that there is “little evidence” that MA enrollees are sicker than the average senior, though risk scores in 2019 were 19 percent higher in MA plans than in original Medicare. That gap continues to widen.

Where does this excess taxpayer money go?

2023 Medicare Advantage business division profits and 2022 CEO compensation reported by publicly traded companies:

UnitedHealth Group: $22.4 B (Andrew Witty $20,865,106)
Aetna (CVS): $8.3 B (Karen Lynch $21,317,055)
Elevance Health (Anthem): $6 B (Gail Boudreaux $20,931,081)
Cigna: $5.1 B (David Cordani $20,965,504)
Centene: $2.7 B (Sarah London $13,246,447)
Humana: $2.5 B (Bruce Broussard $17,198,844)

We found one curious outlier. Molina Health, with annual revenue 10 percent of UnitedHealth Group’s income and 2.16 percent of the market, paid its CEO $22,131,256 in 2022.

Download the entire MedPAC 2024 report here. Chapter 7 is the Home Health section. A summary of MedPACs recommendations begins the chapter thus, “For calendar year 2025, the Congress should reduce the 2024 Medicare base payment rates for home health agencies by 7 percent.”

# # #

 

Tim Rowan is a 30-year home care technology consultant who co-founded and served as Editor and principal writer of this publication for 25 years. He continues to occasionally contribute news and analysis articles under The Rowan Report’s new ownership. He also continues to work part-time as a Home Care recruiting and retention consultant. More information: RowanResources.com
Tim@RowanResources.com

©2024 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in Healthcare at Home: The Rowan Report.homecaretechreport.com One copy may be printed for personal use: further reproduction by permission only. editor@homecaretechreport.com

CMS Issues Medicaid Guidance on Change Healthcare Hack

CMS

by | Mar 20, 2024 | CMS, Vendor Watch

From the NAHC News Desk,

March 19, 2024

On March 15th, the Centers for Medicare & Medicaid Services (CMS) issued a Center Informational Bulletin (CIB) that provides guidance and flexibilities to mitigate the impacts on providers resulting from the Change Healthcare Hack. In the guidance, CMS advises state Medicaid agencies that certain requirements will not be enforced, until June 30th, to enable ongoing funds to flow to providers and to prevent disruption of access to Medicaid services, prevent associated negative health outcomes, and avoid solvency issues for providers.

The most important component of the guidance is the ability for states to make interim payments to providers to avoid operational disruptions. Federal law and regulation does not allow for “advance payments” in Medicaid fee-for-service systems, despite their availability in Medicaid managed care environments; however, states can make interim payments to providers subject to reconciliation with actual services delivered.

CMS stresses that such interim payments are not advanced payments or prepayments prior to services furnished by providers, but rather are payments for services furnished that are subject to final reconciliation once the state has access to individual claims data currently inaccessible due to the cybersecurity incident.

The flexibilities CMS discusses in the guidance include:

  • Modifying required timelines for public notice, public process, and Tribal consultation and to obtain an earlier effective date for certain kinds of SPAs than would otherwise be possible;
  • Use interim payment methodologies to pay providers without current period claims data, as long they are determined via current approved payment rates, limiting the interim payments to the amount expected for each specific provider based on recent history, and reconciling the interim payments with final payments based on the actual services provided once they can be properly identified. These could be effective retroactively to the date when claims payment processing was disrupted due to the cybersecurity incident and could last until June 30, 2024;
  • Suspend beneficiary cost sharing requirements described in their state plans when necessary to avoid service disruptions for Medicaid beneficiaries for services affected by the hack;
medicaid

CMS also includes language urging Medicaid managed care plans to make prospective payments to impacted providers and reiterating that plans do not need prior CMS authority to make prospective payments to providers. CMS also indicates that plans can:

  • Suspend or modify prior authorization requirements;
  • Allow early prescription refills and/or extend the length of prescription refills;
  • Extend existing prior authorizations;
  • Suspend out-of-network requirements; and
  • Modify or update cost-sharing requirements to be consistent with any changes that are made in the Medicaid state plan.

The full guidance is available online at: https://www.medicaid.gov/sites/default/files/2024-03/cib031524.pdf.

HH Accessibility Report

Partner News

by | Dec 19, 2024 | Partner News, Regulatory

FOR IMMEDIATE RELEASE Contact:                  Lauren Corcoran press@trellahealth.com Trella Health Launches Special Report on Home Health Accessibility for Medicare Fee-for-Service (FFS) Beneficiaries An analysis of the key trends shaping access to care for Medicare...