Latest / Becker’s Payer Issues Podcast / Medicare Advantage Market Disruption and the Future of Risk Adjustment with Ceci Connolly

Transcript

Medicare Advantage Market Disruption and the Future of Risk Adjustment with Ceci Connolly · Becker’s Payer Issues Podcast

• 0:00
  - Hi, everyone. This is Elizabeth Caslow with the
• 0:02
  - Becker's Payer Issues podcast.
• 0:04
  - I'm excited today to be joined by Cece
• 0:06
  - Conolly,
• 0:07
  - CEO of the Alliance of Community Health Plans.
• 0:10
  - Cece, thank you so much for joining us
• 0:12
  - today.
• 0:13
  - It's always a treat to be with you,
• 0:15
  - Liz.
• 0:16
  - Yes. We're so excited to have you back.
• 0:18
  - And before we jump in, can you just
• 0:19
  - fill in our audience a little bit more
• 0:21
  - about yourself and your role?
• 0:23
  - Absolutely. So one step back from the current
• 0:26
  - role, I like to say that I was
• 0:28
  - an ink stained wretch for twenty five plus
• 0:30
  - years. I was one of you, Liz, as
• 0:32
  - a daily journalist for many years here in
• 0:36
  - Washington, DC and New England and covered politics
• 0:39
  - and then got into health care. I have
• 0:41
  - now been in this position at ACHP for
• 0:44
  - more than eleven years, and,
• 0:47
  - I am pretty much, chief bottle washer,
• 0:50
  - duties as assigned.
• 0:52
  - We have an amazing team here at ACHP.
• 0:56
  - Of course, federal affairs, policy and advocacy
• 0:59
  - is our,
• 1:00
  - number one calling here on behalf of our
• 1:03
  - members,
• 1:04
  - but we do also have very strong clinical
• 1:06
  - innovation
• 1:08
  - and data analytics teams that all kind of,
• 1:11
  - support those efforts in in policy and advocacy.
• 1:15
  - So that's a bit about us here at
• 1:17
  - ACHP.
• 1:18
  - So I'm excited to chat a little bit
• 1:20
  - more today about some research your team worked
• 1:23
  - on with HealthScape
• 1:24
  - regarding
• 1:25
  - Medicare Advantage market disruption.
• 1:28
  - And just for our listeners, for context, we
• 1:30
  - are recording this before October.
• 1:32
  - But I would love to hear what are
• 1:34
  - some of your key findings from that research?
• 1:38
  - Sure.
• 1:39
  - Happy to. And I think that as you
• 1:41
  - rightly point out,
• 1:43
  - the Medicare Advantage
• 1:45
  - market has been
• 1:47
  - in quite a bit of tumult
• 1:49
  - for several years here. So your listener might
• 1:52
  - be thinking, well, market disruption, that that's not
• 1:55
  - anything new. We we know that, we live
• 1:57
  - it. But it's fascinating
• 1:59
  - when you actually start to pull the data,
• 2:01
  - look at the numbers and also as we
• 2:04
  - did with health scape,
• 2:05
  - map it out onto the 50 states across
• 2:08
  - The US because that's where you really see
• 2:11
  - variation in different geographies.
• 2:14
  - And it's a concerning
• 2:16
  - trend,
• 2:16
  - not only for nonprofit regional plans that are
• 2:20
  - staying there in their local communities,
• 2:23
  - serving their neighbors every single day. But it
• 2:26
  - really should alarm policymakers
• 2:29
  - because we could be left with a real
• 2:32
  - checkerboard
• 2:32
  - kind of coverage for
• 2:35
  - America's
• 2:36
  - seniors if we don't have some
• 2:38
  - intervention pretty soon?
• 2:41
  - So there's a lot of reasons motivating some
• 2:44
  - of the bigger insurers' exits from different markets.
• 2:48
  - And, obviously, nonprofit plans are structured differently. They're
• 2:51
  - not, you know, serving shareholders in the same
• 2:54
  - way.
• 2:55
  - So
• 2:56
  - how are ACHP plans in those areas still
• 2:59
  - reconciling possible financial concerns?
• 3:02
  - Yep. So glad you asked that. So just
• 3:04
  - to begin with a data point or two,
• 3:07
  - what our research uncovered was that in 2026,
• 3:10
  - you had a 10%
• 3:12
  - decline
• 3:13
  - in nationwide
• 3:15
  - MA plan count.
• 3:17
  - That impacted
• 3:19
  - 4,600,000
• 3:21
  - Medicare Advantage beneficiaries
• 3:23
  - who were informed
• 3:24
  - you can't stay with your current plan
• 3:26
  - because they're picking up stakes and leaving.
• 3:30
  - So I think for many seniors
• 3:32
  - that can be,
• 3:34
  - terribly
• 3:35
  - unnerving
• 3:35
  - and confusing
• 3:37
  - and,
• 3:38
  - so difficult if then not only do they
• 3:40
  - have to find a new plan, but that
• 3:42
  - can involve finding new doctors. So it's really,
• 3:46
  - worrisome from the the the view of beneficiaries
• 3:51
  - with respect to our local plans here at
• 3:56
  - ACHP.
• 3:57
  - It meant that frankly, they were picking up
• 3:59
  - many of those.
• 4:01
  - And again, a listener might say, oh, well,
• 4:04
  - growth is good, right? Isn't what that what
• 4:06
  - you want in business? Well, sadly,
• 4:09
  - because of the way that MA is currently
• 4:12
  - running financial pressures and other factors such as
• 4:16
  - risk adjustment, which we can dive into,
• 4:19
  - and
• 4:20
  - the acuity of the beneficiaries.
• 4:22
  - So, basically,
• 4:24
  - how sick are these seniors?
• 4:27
  - We see
• 4:28
  - our local plans that are really getting a
• 4:31
  - big burden put onto them
• 4:34
  - often very abruptly when they don't have as
• 4:37
  - much time to prepare for it. So it's
• 4:39
  - a little bit of a hit to the
• 4:41
  - seniors going through this experience and the locally
• 4:45
  - owned and operated health plans in the communities
• 4:49
  - that are really picking up the slack.
• 4:51
  - I know in our previous conversation, you talked
• 4:54
  - more about urgency around risk adjustment reform. So,
• 4:58
  - would love to just hear your thoughts there
• 4:59
  - in relation to this upcoming
• 5:01
  - MA cycle.
• 5:02
  - MA risk adjustment, my favorite nerdy topic.
• 5:06
  - As many people know, we have done a
• 5:09
  - great amount of analysis
• 5:11
  - of
• 5:13
  - the the risk adjustment
• 5:15
  - over the years. And what we have found
• 5:17
  - is that there are outliers
• 5:20
  - that are collecting
• 5:22
  - billions
• 5:23
  - dollars
• 5:24
  - more. That's billions, b as in boy,
• 5:27
  - more
• 5:28
  - than the ACHP
• 5:30
  - plans
• 5:31
  - based in the communities.
• 5:33
  - One or two of the national
• 5:36
  - publicly traded companies
• 5:38
  - are having
• 5:40
  - significantly
• 5:41
  - higher scores
• 5:42
  - and you really have to take a look
• 5:44
  - and question what's going on there in that
• 5:47
  - data,
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  - but because of those outliers and the way
• 5:50
  - the system has been working now for a
• 5:52
  - number of years, it's gotten out of whack,
• 5:55
  - And so we've been in dialogue with CMS
• 5:58
  - and its leadership for quite some time about
• 6:01
  - addressing
• 6:02
  - these outliers, if you will, to maintain that
• 6:06
  - it's a competitive,
• 6:07
  - fair process.
• 6:09
  - Just as a reminder,
• 6:11
  - risk adjustment was designed
• 6:13
  - not as a profit center
• 6:15
  - for big insurers.
• 6:17
  - Risk adjustment is intended to ensure that the
• 6:21
  - right amount of money
• 6:22
  - goes to a plan to cover
• 6:24
  - the health needs of its population.
• 6:27
  - We support that. It's very, very important.
• 6:30
  - But because it's gotten so out of whack,
• 6:32
  - we've been working with CMS
• 6:34
  - first on ways to streamline and simplify it,
• 6:37
  - but ultimately
• 6:38
  - move in the direction of an inferred risk
• 6:41
  - model
• 6:42
  - that is going to take the coders
• 6:45
  - out of the equation.
• 6:47
  - That's gonna save everyone a lot of money
• 6:49
  - right there,
• 6:51
  - and we're gonna get at what are the
• 6:52
  - true health conditions
• 6:55
  - that plans are treating, so we would be
• 6:58
  - presumably
• 6:59
  - looking at,
• 7:01
  - doctor visits,
• 7:03
  - prescriptions that are filled,
• 7:06
  - lab work that is done, all of that
• 7:08
  - rich information
• 7:10
  - that really tells us what's the patient acuity,
• 7:14
  - what's the right amount of risk adjustment dollars.
• 7:18
  - I also wanna circle back to something you
• 7:20
  - said earlier about how
• 7:21
  - as there are these big MA exits, this
• 7:24
  - could be kind of intimidating for beneficiaries.
• 7:27
  - So do you have an example of one
• 7:28
  - of your plans,
• 7:30
  - helping beneficiaries
• 7:31
  - possibly navigate,
• 7:33
  - a new provider landscape or any other challenges
• 7:36
  - they may be facing?
• 7:38
  - For sure. So we've been spending a lot
• 7:40
  - of time talking with our,
• 7:43
  - member plans,
• 7:44
  - the CEOs who I regularly
• 7:46
  - communicate with, CMOs, etcetera.
• 7:49
  - So, as they have seen these market exits
• 7:52
  - in their regions, they have tried to adapt
• 7:55
  - just as quickly and nimbly as possible. So
• 7:58
  - we have a number of member plans that
• 8:00
  - have added to
• 8:02
  - their customer call lines, for instance, because they
• 8:05
  - know they're gonna get a lot of queries
• 8:07
  - from seniors who are confused. They're getting messages
• 8:11
  - out in through community channels.
• 8:14
  - Sometimes it's working with brokers. Sometimes it's just
• 8:17
  - other local community partners
• 8:19
  - to say, maybe there's been this change, but
• 8:22
  - we're here. Here's what we can offer. Now
• 8:24
  - I have to be candid with you.
• 8:27
  - This puts a lot of burden on smaller
• 8:30
  - local plans, and they have limited
• 8:33
  - dollars and resources.
• 8:35
  - We were just talking about risk adjustment.
• 8:38
  - So they have had to take a very
• 8:40
  - hard look at
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  - plan design,
• 8:43
  - the richness of the benefits they can offer,
• 8:46
  - and even which geographies they can stay in
• 8:50
  - and survive.
• 8:52
  - So the old cliche,
• 8:54
  - no margin, no mission,
• 8:56
  - our members most years are thrilled if they
• 8:59
  - have a one to 2% margin,
• 9:01
  - but they do need to be practical business
• 9:03
  - people if they're gonna continue serving their communities.
• 9:07
  - I'll give you a great example, network health,
• 9:09
  - one of our members based in Wisconsin,
• 9:13
  - they have gotten a phenomenal
• 9:16
  - increase
• 9:17
  - in MA enrollment. They saw this mini tsunami
• 9:21
  - coming, and they actually did major infrastructure changes
• 9:26
  - in order to take in so many of
• 9:29
  - these new members, but it's really challenging.
• 9:33
  - I actually just spoke with net Network Health,
• 9:36
  - a little while ago about the interoperability
• 9:38
  - rule.
• 9:40
  - So I also wanted to ask, as we're
• 9:42
  - heading into MA season, what are some of
• 9:44
  - your predictions, either for your own plans, but
• 9:46
  - also
• 9:47
  - for the bigger plans too in terms of
• 9:50
  - are you foreseeing more exits there?
• 9:53
  - Yes. In a word,
• 9:55
  - and we're concerned about that. I think that
• 9:57
  - those publicly traded companies, they answer to Wall
• 10:01
  - Street.
• 10:02
  - Our member plans,
• 10:04
  - they answer to Main Street. When you answer
• 10:06
  - to Wall Street, you need to post profits
• 10:10
  - margin,
• 10:11
  - show those quarterly returns, it's a very different
• 10:15
  - business that they are running
• 10:17
  - from
• 10:19
  - a plan that's in a community partnering with
• 10:21
  - clinicians,
• 10:23
  - trying to keep people healthy. So, yes,
• 10:26
  - those publicly traded plans are gonna continue to
• 10:29
  - make those decisions until we can do some
• 10:31
  - rightsizing here on the policy side of things.
• 10:36
  - It I also think that we will continue
• 10:38
  - to see difficult choices made around,
• 10:42
  - richness of benefits, plan design, also,
• 10:45
  - whether or not everyone's paying brokers and how
• 10:48
  - much. We at ACHP worked very hard the
• 10:51
  - last several years to get some of those
• 10:53
  - broker reforms in place.
• 10:56
  - We love the local brokers that are partnering
• 10:59
  - in a community,
• 11:00
  - but we also know that you've got some
• 11:02
  - of those behemoth national,
• 11:05
  - broker companies that
• 11:08
  - candidly, they may not even look at a
• 11:10
  - regional plan and mention them. So
• 11:13
  - lots of important,
• 11:15
  - decisions underway there. The other thing I will
• 11:18
  - mention is that we have, had a little
• 11:20
  - bit of success,
• 11:22
  - with CMS on two kind of, I'm gonna
• 11:25
  - call them tweaks with respect to the regulatory
• 11:28
  - perspective. One is the ability for plans in
• 11:31
  - certain instances to put some enrollment
• 11:35
  - caps in place,
• 11:36
  - that plain that is just plain and simple
• 11:39
  - a,
• 11:40
  - responsible
• 11:41
  - fiduciary
• 11:42
  - kind of decision.
• 11:44
  - They wanna make certain that they can take
• 11:46
  - care of everybody that
• 11:49
  - enrolls.
• 11:50
  - The other thing is that we've been getting
• 11:53
  - some flexibility
• 11:54
  - when it comes to how you handle risk
• 11:57
  - adjustment of these new beneficiaries
• 11:59
  - that arrive
• 12:00
  - somewhat unexpectedly,
• 12:02
  - and you may not have a chance to
• 12:04
  - see their,
• 12:05
  - health records for up to eighteen months.
• 12:09
  - That's a major burden on a plan, so
• 12:12
  - we have worked with CMS on some flexibility
• 12:14
  - there.
• 12:16
  - So as we wrap up, Cece, do you
• 12:17
  - have any final thoughts or advice for industry
• 12:20
  - leaders right now?
• 12:22
  - Oh, my goodness.
• 12:24
  - Buckle up. Right?
• 12:27
  - I think that,
• 12:29
  - really what we need to do is
• 12:32
  - come together as a healthcare industry. That means
• 12:36
  - plans,
• 12:37
  - it means clinical folks,
• 12:40
  - And we've got to sit with policymakers
• 12:42
  - now in a room and say,
• 12:45
  - if we want Medicare Advantage to continue serving
• 12:48
  - beneficiaries,
• 12:50
  - all the baby boomers now that have been
• 12:52
  - enrolling every every single day,
• 12:54
  - more generations
• 12:55
  - to come. It's time to address those risk
• 12:58
  - adjustment problems
• 13:00
  - in a very logical,
• 13:01
  - practical approach.
• 13:03
  - We believe that it is some sort of
• 13:05
  - inferred risk model. It's time to come together
• 13:08
  - and really get serious about that.
• 13:11
  - Well, Cece, thank you again for taking the
• 13:13
  - time to chat with us today.
• 13:14
  - My pleasure, as always.
• 13:17
  - So to our listeners, if you'd like to
• 13:19
  - hear more podcasts from Becker's Healthcare, you can
• 13:21
  - visit beckershospitalreview.com.
• 13:23
  - Thank you.