We are now in the Golden Age of government-sponsored health programs, and the opportunities and challenges that come with this shift have never been greater.
We just wrapped our 2015 forum. There was both great and tough news, so here's a few takeaways, including a couple stunners.
For the first time, a prominent Wall Street analyst said he could see a path to 100 percent Medicare Advantage penetration. Barclay's eminent healthcare observer, Josh Raskin, stunned our audience with projections of over 29 million Medicare Advantage enrollees by 2023, a penetration rate of over 42 percent, with the potential to go all the way with Ryan Plan-like legislation now feasible this decade
47 states now hold Section 1915(c) home and community-based services waivers for Medicaid, which will unleash a new flood of dual eligibles into health plans. Special Needs Plans (SNPs) for duals are now on a path to permanent reauthorization, and over 30 states now use D-SNPs to enroll over 1.6 million beneficiaries. That number will more than double in the next 2 years.
While year 2 of open enrollment for ObamaCare was dramatically improved from its messy launch, problems persist, especially with membership reconciliation and issues related to the interim process to auto-enroll most members staying in their plans. Cleanup of membership discrepancies will likely take another year or even longer.
Risk Adjustment Data Validation (RADV) audits will become the new normal in Medicare Advantage. 2015 will be the first time we see plans prosecuted under the False Claims Act and hundreds of millions clawed back by the Centers for Medicare and Medicaid Services for unsubstantiated codes submitted for higher payments.
Maximizing data, strong provider partnerships, documentation and ICD-10 preparedness are keys to audit proofing your Risk Adjustment program.
The Star Ratings system of performance-based payment is the new cornerstone of competition among health plans. Stars has expanded into more than a dozen state Medicaid programs, and to ObamaCare's issuers as well, and the bar is rising. Technical changes to several measures mandate much higher performance to stay ahead of the curve and avoid falling below 4 Stars, where bonus payments and bid rebates vanish. 2015 will be the first year where plans below 3 Stars are terminated.
Medicare Advantage plans won several lobbying victories in this year's "Call Letter", the rate and policy announcement for 2016, including an average 1.25 percent benchmark increase from a cut in the February draft. This signals a new era of influence muscle for the industry, where CMS will increasingly fight out policy changes "below the waterline" in subregulatory guidance and enforcement, where politicians are less likely to intervene.
Appeals and grievances and pharmacy benefit management vendor performance remain the #1, 2 and 3 regulatory infractions in Medicare Advantage, and integration of long-term care and supports and services the leading challenge facing Medicaid health plans.
CMS is on pace for its most aggressive enforcement year ever, with over a dozen actions taken against plans this year already.
As we've said since the passage of the Affordable Care Act, we are now in the Golden Age of government-sponsored health programs, and the opportunities and challenges that come with this shift have never been greater.
John Gorman is the founder and executive chairman of the Gorman Health Group, where this post first appeared.