When stakeholders consider ways to improve Medicare Advantage, they should take care not to romanticize fee-for-service Medicare in the process, SCAN Health Plan CEO Dr. Sachin Jain cautions.
Medicare Advantage (MA) is a growing force in health care. More MA plans emerge each year and the size of their beneficiary populations continues to grow. While the program currently does not cover hospice outside of the value-based insurance design (VBID) model demonstration, it remains one of the few reimbursement pathways for palliative care and services to address social determinants of health.
MA has come under fire from lawmakers and regulators in recent months regarding the plans’ marketing practices and prior authorization policies, as well as cost and quality concerns.
While Jain acknowledged that problems within MA should be addressed, he said effective solutions won’t be as simple as re-embracing the fee-for-service paradigm.
“I’m the first person to say that none of these [Medicare Advantage] entities are perfect,” Jain told Hospice News. “Let’s be a better industry. Let’s regulate this industry. But there’s sort of a glorification of fee-for-service Medicare that I think is misplaced because it doesn’t necessarily acknowledge some of the challenges that beneficiaries face.”
California-based SCAN Health Plan is a $4.3 billion Medicare Advantage (MA) organization that covers more than 270,000 members. The organization will begin participation in the VBID demo in 2023. Jain recently published some of his views on MA vs. fee-for-service in his column in Forbes.
Through Medicare Advantage, the U.S. Centers for Medicare & Medicaid Services (CMS) contracts with private insurance companies to provide coverage for Medicare beneficiaries. In 2023, the number of MA plans will swell to 3,998, up 6% from 2022.
In 2022, these plans covered more than 28 million Americans, close to half of the entire Medicare population, according to the Kaiser Health Foundation. Today is the last day of Medicare’s open enrollment period for 2023, but many anticipate that MA plans will see further gains.
Concerns swirl around marketing, prior authorizations
As signaled by the rising rates of enrollment, MA plans have been popular with consumers. Nearly 88% indicated that they were satisfied with their coverage in a June survey by eHealth.
But recent examinations of the program have prompted calls for stricter oversight.
Last month, the Senate Finance Committee released a report indicating that third-party marketing companies have used deceptive practices to enroll beneficiaries in MA plans. This included reports that some consumers were enrolled without having any contact with a health plan or who received misleading information about coverage, out-of-pocket costs or provider networks.
This followed an investigation earlier this year by the U.S. Department of Health & Human Services Office of the Inspector General (OIG) that found that prior authorization methodologies among some plans led to denials of medically necessary care.
The same report also indicated that 18% of payment requests from providers that were denied by those MAOs also met CMS requirements, though OIG acknowledged that most of those denials were caused by human error during claims processing. Some of the payment and prior authorization denials were also reversed, often after a beneficiary or provider disputed the decision, OIG noted.
“I’m not a Medicare Advantage zealot in any way. All of these are important, serious considerations that we should be evaluating very closely and also reflect some of the reality of what it’s like to be a consumer over the age of 65, looking for a solution for one’s health care,” Jain said. “At the same time, I think sometimes some of the conversations around Medicare Advantage are blind to some of the flaws of fee-for-service Medicare.”
Among these flaws are the higher costs to consumers relative to MA, according to Jain.
Lower out-of-pocket costs, supplemental benefits draw seniors to MA
Recent research by ATI Advisory for the Better Medicare Alliance found that, generally, Medicare Advantage enrollees save an estimated $2,000 annually in health care costs compared to traditional Medicare.
Medicare Advantage plans also have the option to offer supplemental benefits that traditional Medicare does not cover, including eyewear, hearing aids, preventive and comprehensive dental benefits, fitness benefits, and a range of home- and community-based services.
Examples of those include community-based palliative care and programs to address social determinants such as meals, transportation, home modifications and in-home support services, among others.
“There’s a tendency to ignore the fact that there’s so much that goes uncovered in traditional Medicare that does get covered in MA. People have been really careful on this topic to not necessarily be negative about a program that people have really relied upon for a long time,” Jain said. “But when you look at the particulars of what’s covered and what’s not covered, it’s kind of shocking how little protection older adults have from a total-cost perspective.”
The palliative care benefits are of particular interest for hospice providers.
The number of plans offering home-based palliative care will rise to 157 next year from 147 in 2022, according to an analysis by ATI Advisory. This does not include plans that offer palliative care through separate programs like special supplemental benefits for the chronically ill (SSBCI) or the VBID demonstration, and the details of these benefits and what they include can vary among different health plans.
While some stakeholders have argued that existing palliative care benefits are not sufficient to meet the growing need among patients, for now, providers have few other options for securing reimbursement.
Outside of MA, providers can seek reimbursement through ACO relationships or fee-for-service Medicare, which only covers physician or nurse practitioner services. Today, a substantial number of palliative care programs are still supported primarily through philanthropic donations.
MA plans under intensifying scrutiny
Tightening oversight for MA plans will likely remain on the federal government’s agenda for 2023.
CMS has already informed MAOs that it would be enhancing its reviews of marketing materials before they reach consumers, and today the agency proposed rules to implement an electronic prior authorization process and establish related interoperability requirements. If made final, this would foster speedier authorizations, the agency indicated.
Both OIG and the Senate Finance Committee have called on CMS to reinstate MA plan requirements that were rolled back during the Trump Administration. This includes some rules related to marketing and advertising.
The Finance Committee also called for “best practice” requirements for agents and brokers, better monitoring of MA disenrollment patterns, improved information sources for beneficiaries and, again, stricter rules around marketing.
Congress is also mulling a series of bills aimed at Medicare Advantage, including one introduced last week related to mental health coverage.
Other bills include the Medicare & You Handbook Improvement Act, introduced last month by Sens. Maggie Hassan (D-N.H.) and Dr. Roger Marshall (R-Kans.), to improve the information that consumers receive when making their enrollment decisions. In October, Reps. Mark Pocan (D-Wisc.) and Ro Khanna (D-Calif.) also introduced a bill that would prohibit MA plans from using the name “Medicare” in their titles or advertising.
The House in September passed the Improving Seniors’ Timely Access to Care Act, which would implement measures to streamline the prior authorization process. The Senate is now considering the legislation.
Jain told Hospice News that the MA program could benefit from an improved risk-adjustment model with better coding, as well as better documentation and delivery of care coordination.
“We should have a so-called set of Medicare Advantage ‘never events.’ We should never allow ourselves to enable waits and delays in people’s care,” Jain said. “In fee-for-service Medicare, people have care coordination failures all the time. Medicare Advantage plans say that they’re better, but we have to demonstrate that we’re better. And, I would say, have a set of measures that actually looks at key events in people’s lives and ensures that we’re delivering on what people need in those events.”