The Biden administration on Friday finalized new rules aimed at curbing widespread overbilling by private Medicare Advantage insurance plans, but softened its approach after heavy lobbying by the industry.
Regulators are working to develop rules that will cut billions of dollars in annual payments to insurers. However, these changes will be phased in over three years rather than all at once, reducing the immediate impact.
In the short term, private health insurance can receive payments that Medicare officials don’t consider appropriate. The system will ultimately eliminate the extra funds insurance companies receive to cover her fewer than 2,000 patients, including 75 of her who are believed to be subject to extensive manipulation.
However, the extended schedule will alleviate concerns among health plans, physicians and others that broader policy changes, such as higher premiums and reduced benefits for Medicare Advantage beneficiaries, may have unintended consequences. You can also.
In the two months since the proposal went public, insurers and their allies have used television commercials to pressure lawmakers in the Capitol and ask thousands of people to submit their objections, a costly Started loud lobbying.
The country’s top Medicare official acknowledged Friday that industry protests have influenced the shape of the new rule.
Chiquita Brooks-LaSure, administrator of the Center for Medicare and Medicaid Services, said: She said her desire to delay policy change “really came through in our comments and we wanted to respond.”
The new payment scheme is a response to more than a decade of growing evidence that private insurers have been abusing the scheme to extract overpayments from the federal government. Plans cover additional payments to patients whose illnesses may be costly to cover.According to various estimates, insurance companies collect tens of billions of dollars in additional payments annually.
Nearly all major insurers participating in the program have settled or are facing federal fraud lawsuits for such conduct. Evidence of overpayment academic the study, government watchdog report and plan an audit.
Despite the excesses and concerns that Medicare Advantage is denying the care they need too often, about half of Medicare beneficiaries now have private plans, spending more than $400 billion annually in government spending. is receiving Popular with consumers who often enjoy lower premiums and benefits (such as eye and dental services) not offered by the government’s basic Medicare plan.
The program is profitable even for the largest insurers.recently research A Kaiser Family Foundation study found that insurers nearly doubled their gross margins on Medicare plans created by other lines of business. Humana recently announced it would stop offering commercial insurance to focus on Medicare, which serves the elderly and disabled in the United States, and Medicaid, which primarily serves low-income individuals.
The new rule ultimately eliminates extra payments for many diagnoses that Medicare Advantage Plans commonly reported but Medicare data didn’t show were more medically relevant. These diagnostic codes include some specifically targeted by private programs, such as “complicated” diabetes, a form of severe malnutrition commonly seen in countries experiencing famine. It was
With a three-year phase-in, insurers will receive payments in the first year based on one-third of the new formula and two-thirds of the old formula. Overall, Medicare estimates that Medicare Advantage plans will pay 3.32% more next year than they did this year. Under the original limits proposed by the administration, that increase would have been about 1%. It also took him three years to change the previous payment model.
Opponents of the policy argue that the change could hurt the interests of plan customers and disproportionately affect the poor and minorities. did not relieve
“We appreciate that CMS has moved to a step-by-step approach, but the underlying policy remains essentially unchanged,” he said. Mary Beth Donahue, president of the Better Medicare Alliance, a trade group fighting policy by spending eight figures on TV advertising. “We remain concerned about the unintended consequences of this risk adjustment policy for older adults. ”
But the Community Health Plans Alliance, a group representing non-profit insurers, said in a statement that it had endorsed the new approach: ”
Insurers often challenge government agency Medicare actions in court, but it is unclear whether insurers will challenge this policy.
Some proponents and experts feel the new formula is too timid. comment letter The proposed changes “are right in the right direction but fall short of addressing the scale of excessive Medicare spending.”
Former MedPAC executive director Mark Miller urged Medicare to go further than its original proposal. He currently serves as Executive Vice President of Arnold Ventures. Arnold Ventures is a policy and advocacy group closely associated with the groups that funded it. TV advertising Advocate for change. He described the final approach as disappointing. “They’re basically bowing to the plan,” he said in an email.
In February, just weeks after announcing the proposal, top health officials in the Biden administration vigorously defended the change.in the series of TweetHealth and Human Services Secretary Xavier Becerra characterized criticism of the policy as “disinformation being pushed by highly paid industry hackers and their allies.” In an interview with The New York Times, Dr. Meena Seshamani, the chief executive of Medicare, said she was “dedicated to holding the industry accountable for abusing the system.”
Brooks-LaSure’s comments on Friday were more cautious, emphasizing the “stakeholder” perspective of the Medicare program. She said she doesn’t feel Medicare is bowing to industry pressure.
The payment change is one of a stringent set of rules for programs recently proposed or completed by the Administration. Another proposal would be to control the industry’s marketing more tightly and make it harder for plans to deny care to patients. And the rules, which were finalized in January, require a plan to reimburse the government for a greater portion of overpayments uncovered by audits.
The Medicare Advantage program has long enjoyed strong bipartisan support in the Capitol, but despite all the lobbying, few leading lawmakers have stepped forward in this round to defend the plan. Republicans on the committee overseeing the program wrote letters to Medicare officials asking technical questions about the changes, but avoided harsh criticism of the policy. On Tuesday, 17 House Democrats sent a letter to Medicare officials asking them to delay but not cancel implementation.
It was presented by Dr. Bill Cassidy of Louisiana, Republican leader of the Senate Health, Education, Labor and Pensions Committee, and Sen. Jeff Markley, Democrat of Oregon. legislation On Tuesday, we will take further steps to prevent “unauthorized payments, coding, or diagnostics.”
