Medicaid Fraud Suit Could Hurt Aetna’s Future Bid Chances

September 17, 2021

A recently unsealed whistleblower lawsuit accuses CVS Health Corp.’s Aetna of defrauding the Commonwealth of Pennsylvania and the federal Medicaid program by knowingly misrepresenting the number of pediatricians in Aetna’s Medicaid network. While the outcome of the suit is far from certain, and the Dept. of Justice opted not to intervene in the matter, legal experts say the case may have merit — and Medicaid insiders say that Aetna’s reputation may take a hit.

Carol Wessner, a nurse and former Early and Periodic Screening, Diagnostic and Treatment consultant for Aetna, alleges in a recently unsealed lawsuit that pediatric primary care was practically inaccessible to Aetna’s Medicaid members because of its incorrect provider directory. The insurer covered 265,868 Medicaid lives in 2020 under the Aetna Better Health of Pennsylvania brand, according to Pennsylvania’s Dept. of Human Services (DHS). Wessner’s suit claims that, in fraudulently exaggerating the amount of pediatric primary care doctors and the number of patients they served, Aetna was able to pocket an excessive margin of its capitated payments from the Medicaid program.

A recently unsealed whistleblower lawsuit accuses CVS Health Corp.’s Aetna of defrauding the Commonwealth of Pennsylvania and the federal Medicaid program by knowingly misrepresenting the number of pediatricians in Aetna’s Medicaid network. While the outcome of the suit is far from certain, and the Dept. of Justice opted not to intervene in the matter, legal experts say the case may have merit — and Medicaid insiders say that Aetna’s reputation may take a hit.

Carol Wessner, a nurse and former Early and Periodic Screening, Diagnostic and Treatment consultant for Aetna, alleges in a recently unsealed lawsuit that pediatric primary care was practically inaccessible to Aetna’s Medicaid members because of its incorrect provider directory. The insurer covered 265,868 Medicaid lives in 2020 under the Aetna Better Health of Pennsylvania brand, according to Pennsylvania’s Dept. of Human Services (DHS). Wessner’s suit claims that, in fraudulently exaggerating the amount of pediatric primary care doctors and the number of patients they served, Aetna was able to pocket an excessive margin of its capitated payments from the Medicaid program.

In a court filing, Wessner also claims that she made Aetna executives including Aetna Better Health CEO Jason Rottman and Director of Quality Management Alice Jefferson aware of the network’s shortcomings — and that they retaliated against Wessner by terminating her. In 2017, Wessner first filed a qui tam whistleblower complaint under the False Claims Act of 1863, which means that she would be entitled to a large portion of any settlement or damages Aetna might pay. During that time, federal prosecutors considered whether to join the case against Aetna.

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Broker Payment Transparency Rule May Trigger Policy Changes

September 17, 2021

So far this month, in addition to allocating hundreds of millions of dollars in federal funding to augment various aspects of the Affordable Care Act marketplaces, the Biden administration has also proposed a regulation that would increase transparency about how brokers are compensated for selling certain health plans. Health policy experts say that while those new requirements may not be particularly helpful for consumers, they could eventually trigger policymaking that alters some insurers’ broker payment practices.

The broker compensation provisions appear in a notice of proposed rulemaking (NPRM) issued jointly by HHS, the Labor and Treasury departments and the Office of Personnel Management — a large portion of which is devoted to establishing new data-reporting requirements for air ambulance services (which historically were a frequent source of surprise medical bills). In addition to those provisions, the NPRM proposes to require issuers offering individual health insurance coverage or short-term, limited duration insurance (STLDI) to “disclose to policyholders, before finalizing plan selection as well as on documentation confirming the individual’s enrollment, commission rates and compensation structure for other direct and indirect compensation provided by the issuer to an agent or broker associated with enrolling those individuals.”

So far this month, in addition to allocating hundreds of millions of dollars in federal funding to augment various aspects of the Affordable Care Act marketplaces, the Biden administration has also proposed a regulation that would increase transparency about how brokers are compensated for selling certain health plans. Health policy experts say that while those new requirements may not be particularly helpful for consumers, they could eventually trigger policymaking that alters some insurers’ broker payment practices.

The broker compensation provisions appear in a notice of proposed rulemaking (NPRM) issued jointly by HHS, the Labor and Treasury departments and the Office of Personnel Management — a large portion of which is devoted to establishing new data-reporting requirements for air ambulance services (which historically were a frequent source of surprise medical bills). In addition to those provisions, the NPRM proposes to require issuers offering individual health insurance coverage or short-term, limited duration insurance (STLDI) to “disclose to policyholders, before finalizing plan selection as well as on documentation confirming the individual’s enrollment, commission rates and compensation structure for other direct and indirect compensation provided by the issuer to an agent or broker associated with enrolling those individuals.”

The proposed rules would further require insurers to “report to HHS the actual, total amount of direct and indirect compensation paid by the issuer to the agent and broker for the preceding year.”

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Biden Unveils Sweeping Vaccine Mandates Amid Delta Variant Surge

September 17, 2021

To curb the surging delta variant, President Joe Biden last Thursday laid out coronavirus vaccine mandates that could affect tens of millions of Americans including federal workers, employees at large firms (like health insurance companies) and health care staff. Experts say the vaccines are highly effective at slowing the spread of the virus, saving lives and health care costs. A recent Health Affairs study suggested that by May 9, 2021, vaccination against COVID-19 may be associated with a reduction of nearly 140,000 deaths. Another Kaiser Family Foundation analysis estimated that between June and August 2021, over 280,000 COVID-related hospitalizations — costing over $5.7 billion combined — could have been prevented by vaccination. Almost 180 million Americans are fully vaccinated against the virus, yet new cases are still rising in recent weeks, most of which occurred among those not yet fully vaccinated, according to data from the Centers for Disease Control and Prevention.

by Jinghong Chen

To curb the surging delta variant, President Joe Biden last Thursday laid out coronavirus vaccine mandates that could affect tens of millions of Americans including federal workers, employees at large firms (like health insurance companies) and health care staff. Experts say the vaccines are highly effective at slowing the spread of the virus, saving lives and health care costs. A recent Health Affairs study suggested that by May 9, 2021, vaccination against COVID-19 may be associated with a reduction of nearly 140,000 deaths. Another Kaiser Family Foundation analysis estimated that between June and August 2021, over 280,000 COVID-related hospitalizations — costing over $5.7 billion combined — could have been prevented by vaccination. Almost 180 million Americans are fully vaccinated against the virus, yet new cases are still rising in recent weeks, most of which occurred among those not yet fully vaccinated, according to data from the Centers for Disease Control and Prevention.

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UnitedHealth Touts ASC Savings, But Are There Drawbacks?

September 17, 2021

A newly published report from UnitedHealthcare makes a strong financial case for moving routine, non-complex medical procedures — such as a gallbladder removal — from hospital outpatient departments to ambulatory surgery centers (ASCs). However, one industry observer cites a potential downside to shifting low-risk surgeries away from hospitals, and research suggests that access to ASCs is not equal across all populations.

For its report, UnitedHealthcare examined claims data from the insurer’s employer-sponsored plan members during the 12 months ending February 2020. Of the 6 million routine outpatient procedures that were performed in hospital outpatient departments for this population, 56% involved non-complex patients who had an ASC within a short distance from their homes. If such patients were to choose an ASC as their site of care, it would reduce the cost of routine procedures by an average of 59% — saving consumers $684 on average per procedure, according to UnitedHealthcare.

A newly published report from UnitedHealthcare makes a strong financial case for moving routine, non-complex medical procedures — such as a gallbladder removal — from hospital outpatient departments to ambulatory surgery centers (ASCs). However, one industry observer cites a potential downside to shifting low-risk surgeries away from hospitals, and research suggests that access to ASCs is not equal across all populations.

For its report, UnitedHealthcare examined claims data from the insurer’s employer-sponsored plan members during the 12 months ending February 2020. Of the 6 million routine outpatient procedures that were performed in hospital outpatient departments for this population, 56% involved non-complex patients who had an ASC within a short distance from their homes. If such patients were to choose an ASC as their site of care, it would reduce the cost of routine procedures by an average of 59% — saving consumers $684 on average per procedure, according to UnitedHealthcare.

Those estimated cost savings are attributable to the fact that surgeries performed at ASCs are well-known to be cheaper than those taking place at a hospital. According to the UnitedHealthcare report, the average price of common procedures performed in a hospital outpatient department in 2019 was $7,716, or 144% more than the average price of the same procedures performed in ASCs.

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News Briefs

September 17, 2021

Three centrist Democrats on the House Energy and Commerce committee on Sept. 15 voted down language in a bill that would have enabled Medicare to negotiate drug prices. Reps. Scott Peters (Calif.), Kathleen Rice (N.Y.) and Kurt Schrader (Ore.) joined the committee’s Republicans to keep the measure from advancing. Committee Chair Rep. Frank Pallone (D-N.J.) made several public appeals in favor of drug price negotiation to the trio, who according to Politico all voted in favor of Medicare price negotiation in 2019. Despite the setback, price negotiation is far from dead, according to James Gelfand, executive vice president of public affairs at the ERISA Industry Committee. “My understanding is that the bill can be completely rewritten in the Rules Committee if need be,” Gelfand tells AIS Health via email. He adds that Democratic leaders “have to offer something to Rice…I don’t know exactly what yet. But they cannot afford to blow a $5-600 billion hole in the bill before it gets to the Senate.”

Three centrist Democrats on the House Energy and Commerce committee on Sept. 15 voted down language in a bill that would have enabled Medicare to negotiate drug prices. Reps. Scott Peters (Calif.), Kathleen Rice (N.Y.) and Kurt Schrader (Ore.) joined the committee’s Republicans to keep the measure from advancing. Committee Chair Rep. Frank Pallone (D-N.J.) made several public appeals in favor of drug price negotiation to the trio, who according to Politico all voted in favor of Medicare price negotiation in 2019. Despite the setback, price negotiation is far from dead, according to James Gelfand, executive vice president of public affairs at the ERISA Industry Committee. “My understanding is that the bill can be completely rewritten in the Rules Committee if need be,” Gelfand tells AIS Health via email. He adds that Democratic leaders “have to offer something to Rice…I don’t know exactly what yet. But they cannot afford to blow a $5-600 billion hole in the bill before it gets to the Senate.”

After a plan member filed suit against CVS Health Corp.’s Aetna, accusing the payer of discriminating against LGBTQ+ members in fertility care reimbursement, the health plan announced plans to change its coverage. According to the National Women’s Law Center (NWLF), whose lawyers filed the complaint, “the suit alleges that Aetna’s policy for coverage of IVF and IUI fertility treatments unfairly discriminates against LGBTQ couples by requiring them to pay out of pocket for 12 cycles of IUI before Aetna will provide them with coverage.” NWLF told Modern Healthcare that “we are pleased to learn that there is interest in resolving the matter.”

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HHS Rallies Behind Drug Price Negotiation, Part D Reform

September 16, 2021

As Congress considers expanding Medicare benefits through the budget reconciliation process, a new HHS report expresses the agency’s support for “bold legislative action” to bring down drug prices and outlines a “comprehensive” plan that includes several administrative actions it could take to promote competition among drug companies. Notably, the report calls for legislation allowing HHS Secretary Xavier Becerra to directly negotiate drug prices with manufacturers for coverage under the Medicare Parts B and D programs and to make those prices available to other payers, and the exploration of various concepts by the CMS Innovation Center.

As Congress considers expanding Medicare benefits through the budget reconciliation process, a new HHS report expresses the agency’s support for “bold legislative action” to bring down drug prices and outlines a “comprehensive” plan that includes several administrative actions it could take to promote competition among drug companies. Notably, the report calls for legislation allowing HHS Secretary Xavier Becerra to directly negotiate drug prices with manufacturers for coverage under the Medicare Parts B and D programs and to make those prices available to other payers, and the exploration of various concepts by the CMS Innovation Center.

The HHS Office of the Assistant Secretary for Planning and Evaluation on Sept. 9 issued the report in response to President Joe Biden’s Executive Order on Promoting Competition in the American Economy, which called for a multitude of actions from HHS, including lowering the prices of and improving access to prescription drugs and biosimilars. Meanwhile, lawmakers are considering adding dental, hearing and vision benefits to fee-for-service Medicare as part of a $3.5 trillion spending package that Senate Democrats aim to pass via budget reconciliation, and drug pricing has been viewed as a way to pay for those enhancements.

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With More Online Enrollment, MAOs Must Add ‘Personal Touch’

September 16, 2021

As Medicare Advantage organizations prepare to promote their plans for the 2022 Medicare Annual Election Period (AEP), marketing experts say they see a continued shift to year-round and online campaigns. But with the increased use of digital engagement and enrollment leading to some member dissatisfaction, plans must take extra steps to ensure a positive experience early on, they warn.

CMS as of press time had not yet released its annual “landscape” files for the MA and Part D programs, but data released this time last year indicated that MA beneficiaries in 2021 had an average number of 47 plan choices per county, up from 39 in 2020, and that more than 4,800 MA plans were operating in 2021, compared with 4,300 in 2020. Marketing for the AEP begins on Oct. 1, and open enrollment runs from Oct. 15 through Dec. 7.

As Medicare Advantage organizations prepare to promote their plans for the 2022 Medicare Annual Election Period (AEP), marketing experts say they see a continued shift to year-round and online campaigns. But with the increased use of digital engagement and enrollment leading to some member dissatisfaction, plans must take extra steps to ensure a positive experience early on, they warn.

CMS as of press time had not yet released its annual “landscape” files for the MA and Part D programs, but data released this time last year indicated that MA beneficiaries in 2021 had an average number of 47 plan choices per county, up from 39 in 2020, and that more than 4,800 MA plans were operating in 2021, compared with 4,300 in 2020. Marketing for the AEP begins on Oct. 1, and open enrollment runs from Oct. 15 through Dec. 7.

In her work assisting MAOs with their AEP marketing, DMW Direct Executive Vice President Renee Mezzanotte observes that while last year’s election-related disruptions are behind them, “plans and consumers are still dealing with the uncertainties of COVID.” And that’s not just having an impact on in-person engagement but in the “unexpected channel” of direct mail, she tells AIS Health, a division of MMIT.

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SCAN Ventures Outside Golden State With Ariz., Nev. Offerings

Charts: Top 5 Insurers in Ariz., Nev. MA Markets

September 16, 2021

Following a slew of announcements from Medicare Advantage insurers unveiling new service areas for 2022, SCAN Health Plan on Sept. 9 said it plans to expand its reach beyond California to two new states next year. The Long Beach, Calif.-based insurer currently serves more than 220,000 members in California and is one of the nation’s largest not-for-profit MA plans.

During the upcoming Annual Election Period (AEP), which starts on Oct. 15, Medicare beneficiaries residing in Clark County, Nevada, can enroll in SCAN Health Plan. And in the Arizona counties of Maricopa, Pima and Pinal, individuals can sign up with SCAN Desert Health Plan. UnitedHealthcare currently dominates both markets, followed by Humana Inc. (see charts below). In addition, SCAN’s MA plans will be available in two new California counties — Alameda and San Mateo — enabling it to reach more than 5 million potential customers across 17 markets in three states. SCAN will communicate with potential customers in five different languages, including English, Spanish, Korean and Chinese.

Following a slew of announcements from Medicare Advantage insurers unveiling new service areas for 2022, SCAN Health Plan on Sept. 9 said it plans to expand its reach beyond California to two new states next year. The Long Beach, Calif.-based insurer currently serves more than 220,000 members in California and is one of the nation’s largest not-for-profit MA plans.

During the upcoming Annual Election Period (AEP), which starts on Oct. 15, Medicare beneficiaries residing in Clark County, Nevada, can enroll in SCAN Health Plan. And in the Arizona counties of Maricopa, Pima and Pinal, individuals can sign up with SCAN Desert Health Plan. UnitedHealthcare currently dominates both markets, followed by Humana Inc. (see charts below). In addition, SCAN’s MA plans will be available in two new California counties — Alameda and San Mateo — enabling it to reach more than 5 million potential customers across 17 markets in three states. SCAN will communicate with potential customers in five different languages, including English, Spanish, Korean and Chinese.

AIS Health, a division of MMIT, spoke with Jill Selby, SCAN’s senior vice president of product development and market expansion, about this milestone move. Editor’s note: This interview has been edited for length and clarity.

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Highmark Expands Public-Sector Presence With Spate of Acquisitions

September 16, 2021

Pennsylvania Blues powerhouse Highmark Health completed a series of acquisitions in 2021 that stand to boost its public-sector membership by nearly 500,000 lives. First, in March, Highmark completed an affiliation deal with HealthNow New York Inc., the parent company of BlueCross BlueShield of Western New York and BlueShield of Northeastern New York, expanding its reach to the Empire State in several key markets, including Medicare Advantage. Then on Sept. 7, Highmark took full ownership of Gateway Health Plan, the third-largest Medicaid insurer in Pennsylvania. (Highmark originally held a 50% stake in the company). Gateway’s offerings will be rebranded as Highmark Wholecare. With these deals bringing its overall enrollment up to about 4.6 million lives, Highmark has become the fifth-largest Blues affiliate in the U.S., according to AIS’s Directory of Health Plans.

by Carina Belles

Pennsylvania Blues powerhouse Highmark Health completed a series of acquisitions in 2021 that stand to boost its public-sector membership by nearly 500,000 lives. First, in March, Highmark completed an affiliation deal with HealthNow New York Inc., the parent company of BlueCross BlueShield of Western New York and BlueShield of Northeastern New York, expanding its reach to the Empire State in several key markets, including Medicare Advantage. Then on Sept. 7, Highmark took full ownership of Gateway Health Plan, the third-largest Medicaid insurer in Pennsylvania. (Highmark originally held a 50% stake in the company). Gateway’s offerings will be rebranded as Highmark Wholecare. With these deals bringing its overall enrollment up to about 4.6 million lives, Highmark has become the fifth-largest Blues affiliate in the U.S., according to AIS’s Directory of Health Plans.

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MedPAC: Reforms to Part D LIS Could Produce Savings

September 16, 2021

Although the Medicare Part D program’s low-income subsidy is designed to ensure all beneficiaries have access to drug coverage, the Medicare Payment Advisory Commission (MedPAC) is concerned that the LIS in its current format has the potential to limit competition among benchmark plans and result in higher Medicare spending. As policymakers seek ways to preserve the Medicare Trust Fund while expanding Medicare benefits, LIS reforms could save the program money, MedPAC suggested at its most recent public meeting.

The LIS subsidizes premiums for nearly 13 million Medicare Part D beneficiaries, or 27% of overall Part D enrollees. Spending for LIS premiums in 2019, the most recent year available, totaled $3.8 billion, according to a Sept. 2 presentation by MedPAC Principal Policy Analyst Eric Rollins.

Although the Medicare Part D program’s low-income subsidy is designed to ensure all beneficiaries have access to drug coverage, the Medicare Payment Advisory Commission (MedPAC) is concerned that the LIS in its current format has the potential to limit competition among benchmark plans and result in higher Medicare spending. As policymakers seek ways to preserve the Medicare Trust Fund while expanding Medicare benefits, LIS reforms could save the program money, MedPAC suggested at its most recent public meeting.

The LIS subsidizes premiums for nearly 13 million Medicare Part D beneficiaries, or 27% of overall Part D enrollees. Spending for LIS premiums in 2019, the most recent year available, totaled $3.8 billion, according to a Sept. 2 presentation by MedPAC Principal Policy Analyst Eric Rollins.

MedPAC Suggests Revisiting Benchmark

As the system is currently structured, the benchmark — which is designed to promote enrollment into lower-cost plans — equals the average premium for basic coverage across all stand-alone Prescription Drug Plans (PDPs) and Medicare Advantage Prescription Drug (MA-PD) plans in a region, and the premium for each plan is weighted by its LIS enrollment. Enrollees who sign up for basic plans that cost less than the benchmark do not have to pay a premium.

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