It is difficult to imagine worse news for Medicare Advantage and Part D plans than provisions included in the 2014 rate notice and “call letter” issued by CMS on Feb. 15. Not only were there negative surprises in the base payment rates themselves, but there also was a host of likely methodology changes that could cut the payments received by MA sponsors in some cases starting in 2014 and in others beginning in 2015. They include significant alterations in how risk adjustments are determined, how CMS calculates the key fee-for-service cost in each county and how much plans may increase a beneficiary’s total cost from 2013 to 2014. Find out what this key “45-day notice” document means now for Medicare Advantage and Part D organizations and their partners…and steps you can take to cushion the blow.
The On-Demand recording will be available immediately upon purchase* as a link within a PDF file of the accompanying written materials. CDs and printed materials are shipped via USPS.
The combined effect of the changes proposed for Medicare Advantage (MA) and Part D plans in the “45-day notice” issued Feb. 15 amounts to the biggest collection of bad news the industry ever has received at one time. First, plans and their advisers alike were surprised with what amounts to a several-percentage-point cut in their base payment rates for 2014. Then, CMS proposed changes in the ways plans have managed to offset some of the effects of rate cuts in the past. These potential changes include altering the risk-adjustment model in a way the agency itself says will lower risk scores and limiting how plans can use health risk assessments to boost risk scores.
The financial outlook is even bleaker when you combine these new proposals with the large coding intensity adjuster increase plans will have to absorb for 2014 plus a reduction in the amount by which plans can boost beneficiaries’ out-of-pocket costs for next year. There also are tremendous uncertainties that plans may face from another “rebasing” of counties to determine which payment quartile they’re assigned to, and from a change CMS is considering in how it calculates the costs on which county rates are based.
Hear two experts in the strategic analysis of Medicare Advantage payment rates dissect the new proposals and assess the implications of the 45-day notice for MA plans and their partners. You’ll get reliable strategic information and answers to key questions such as:
WILLIAM A. MACBAIN is senior vice president, finance of Gorman Health Group, LLC. He has more than 25 years of experience in senior management positions in the health care industry, including serving as chief financial officer of Capital District Physicians’ Health Plan in Albany, N.Y., and senior vice president and chief operating officer of Geisinger Health Plan in Danville, Pa. Mr. MacBain has been a board member of the American Association of Health Plans (the predecessor to AHIP), a member of the Medicare Payment Advisory Commission and president of the Managed Care Association of Pennsylvania.
TIM COURTNEY is senior consulting actuary at Wakely Consulting Group, Inc. in Clearwater, Fla. Mr. Courtney joined the firm in 2010 after serving as a managing director at Ingenix Consulting and an associate actuary at Milliman. He has been a health actuary for more than 20 years and has broad experience in projecting financial data for MA and Part D plans, including development of their bids. Recently, he had an article published in the Health Watch publication of the Society of Actuaries, of which he is a fellow, on the future of MA revenue.
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