RISE looks at the latest headlines that impact Medicare, Medicare Advantage, and Medicaid.
Coalition blasts OIG report on MA health risk assessments
The Better Medicare Alliance (BMA), the leading research and advocacy organization supporting Medicare Advantage (MA), is pushing back on the results of a recent Office of Inspector General (OIG) report that raises concerns about the completeness of health risk assessments (HRAs) payment data, validity of diagnoses, and quality of care coordination for beneficiaries.
HRAs are conducted by licensed clinical providers to reach homebound beneficiaries and provide a complete, accurate picture of the MA member’s health. The OIG said it conducted the study due to concerns that MA organizations may use HRAs to increase risk-adjusted payments inappropriately. Risk-adjustment payments provide additional funding to MA organizations that enroll sicker and costlier beneficiaries. It’s meant to level the playing field and prevent MA plans from cherry-picking healthier members. But the OIG said unsupported risk-adjusted payments have been a major driver of improper payments in the MA program.
The OIG analyzed 2016 MA encounter data to determine the 2017 financial impact of diagnoses reported only on HRAs and not on any other records in the encounter data that year. It also examined CMS’ responses to a questionnaire that identified actions the agency took to review the impact of HRAs on MA payment.
The study found that diagnoses that MA organizations reported only on HRAs resulted in nearly $2.6 billion in risk-adjusted payments for 2017. Eighty percent of these estimated payments were from in-home HRAs. Furthermore, 20 MA organizations generated millions in payments from in-home HRAs for beneficiaries for whom there was not a single record of any other service being provided in all of 2016.
“Our findings raise concerns about the completeness of payment data submitted to CMS, the validity of diagnoses on HRAs, and the quality of care coordination for beneficiaries. Despite potential issues regarding HRAs, CMS has not yet reviewed the impact of HRAs on risk adjusted payments or quality of care,” the OIG said.
But in a blog post for BMA, Deborah Estes, director of policy and research, said that the OIG report draws sweeping conclusions based on incomplete data from 2016 that impacted only one percent of payments in MA for 2017—payments that may have been used to provide care and services for these beneficiaries.
“The OIG continues to cherry-pick parts of the risk adjustment process to review rather than the process as a whole,” Estes wrote. “This tunnel vision consistently results in misinformation to the public and risks distorting the true utilization of HRAs, even as they acknowledged that in-home HRAs are an effective way to conduct risk assessments.”
ACOs saved Medicare billions in 2019
The Medicare Shared Savings Program, the largest value-based payment program in fee-for-service Medicare for accountable care organizations (ACOs), saved Medicare $1.2 billion in 2019, according to CMS Administrator Seema Verma.
In a blog post for Health Affairs, Verma said that last year 541 ACOs in the Medicare Shared Savings Program cared for 11.2 million beneficiaries and generated $1.19 billion in total net savings to Medicare. It is the third year in a row that the program has achieved net program savings.
"These results clearly show that ACOs are helping improve our health system at a time when it’s needed more than ever,” said Clif Gaus, president and CEO of the National Association of ACOs (NAACOS), in an announcement. “When we emerge from the ongoing pandemic, we’ll need alternatives to fragmented fee-for-service and better cost-control strategies, which ACOs provide. There should be no debate that we need to foster the growth of more ACOs, so their benefits are delivered to more seniors."
In addition to the positive 2019 results from CMS, Gaus said multiple analyses have shown ACOs are lowering Medicare spending by 1 percent to 2 percent, which translates into tens of billions of dollars of reduced Medicare spending when compounded annually.
CMS bends to stakeholder pressure and withdraws MFAR rule
Verma also announced on Twitter Monday that the agency has withdrawn its proposed Medicaid Fiscal Accountability Regulation (MFAR) rule. The proposed rule was designed to increase transparency in Medicaid financing but many in the health care industry argued it would have increased federal oversight on state Medicaid programs and could lead to significant funding cuts.
“We’ve listened closely to concerns that have been raised by our state and provider partners about potential unintended consequences of the proposed rule, which require further study. Therefore, CMS is withdrawing the rule from the regulatory agenda,” Verma said in the tweet.
The withdrawal was welcome news to the American Hospital Association (AHA) and America’s Essential Hospitals. “Up to $50 billion in annual funding for the Medicaid program was on the line, cuts that would have crippled state financing and limited access to care, especially in rural and underserved areas. Hospitals and health systems will be greatly relieved when the proposed rule is formally withdrawn,” said AHA Executive Vice President Tom Nickels, in a statement.
America’s Essential Hospitals also praised the decision, noting that state budgets and providers are already strained under the heavy financial burden and economic fallout of COVID-19. “The nation’s essential hospitals and their low-income patients rely on Medicaid to make affordable, high-quality health care available to all. We must work to preserve and strengthen Medicaid and advance innovation in this vital safety-net program,” said Beth Feldpush, DrPH, senior vice president of policy and advocacy.