JustCare

Tag: Data

  • 2024: Too little known about Medicare Advantage

    2024: Too little known about Medicare Advantage

    The Kaiser Family Foundation lays out what Medicare Advantage plans–the health plans administered by corporate health insurers–are doing for their Medicare members in 2024. The Medicare Advantage plans disclose limited data on their performance. They are all too likely to be inappropriately delaying and denying care for anyone with a complex and costly condition because that’s one way they can maximize profits.

    The insurers offering Medicare Advantage plans receive, on average, $2,329 more per enrollee than the government spends on enrollees in Traditional Medicare as a result of a defective payment system. With this money, they can offer an out-of-pocket cap and other appealing-sounding benefits to members. But, they pocket much of this money to benefit their shareholders, and people in Medicare Advantage often struggle to get the Medicare benefits to which they are entitled.

    People in Medicare Advantage, unlike in Traditional Medicare, frequently cannot get the care they want from the physicians they know and trust. In Traditional Medicare, they are covered for reasonable and necessary services from most doctors and hospitals anywhere in the country. In an HMO, they can’t get care outside their community generally; moreover, they often need approval for costly and complex services from their Medicare Advantage plans before they will be covered.

    It’s concerning that there’s so little data reflecting what the Medicare Advantage plans are doing with the money the government gives them. We don’t know what MA plans spend and don’t spend on care, or how often they deny costly services. We don’t know how many hoops each MA plan puts people through or the extent to which each MA plan discriminates against different subpopulations of people with Medicare.

    We do know that 99 percent of people in Medicare Advantage plans must get prior authorization before they can get certain services. Generally, skilled nursing and rehab care, Part B drugs, inpatient hospital stays and psychiatric services all require prior authorization.

    As Medicare Advantage insurers have learned to game the Medicare payment system–largely by relying on physicians and nurses to add diagnosis codes to patient records, even when they are not treating patients for these conditions–the insurers  have been able to offer a little bit more in the way of supplemental benefits to their members. People often join Medicare Advantage plans for these benefits. But, it’s unclear how many people actually receive these benefits; the data is unavailable. And, it’s equally unclear what basic Medicare benefits they give up–as a result of inappropriate denials of care–in exchange for these supplemental benefits.

    To be more specific, it’s unclear how valuable a Medicare Advantage plan’s dental benefit is. It’s not standardized. So, depending upon the Medicare Advantage plan, it could only cover care from a small number of dentists or only cover a small fraction of the total cost of dental services or only cover a cleaning. Copays can be high.

    People in Medicare Advantage have an out-of-pocket limit on their costs, if their Medicare Advantage plan is willing to cover the care their treating physicians say they need. The limit averages $4,882 for people in HMOs and $8,707 for people in PPOs. Traditional Medicare limits people’s costs to 20 percent of its approved amount with no ceiling.

    Here’s more from Just Care:

  • What we don’t know about Medicare Advantage

    What we don’t know about Medicare Advantage

    [Editor’s note: The following is the response to a request for information about Medicare Advantage data gaps by the Centers for Medicare and Medicare Services, from a coalescence of grassroots organizations and others.]

    May 29, 2024

    The Honorable Chiquita Brooks-LaSure Administrator
    Centers for Medicare and Medicaid Services
    U.S. Department of Health and Human Services
    200 Independence Avenue, SW Washington, DC 20201
    The Honorable Xavier Becerra, Secretary
    U.S. Department of Health and Human Services
    200 Independence Avenue, SW Washington, DC 20201

    Re: CMS-4207-NC–Medicare Program; Request for Information on Medicare Advantage Data Submitted electronically via https://www.regulations.gov

    Dear Administrator Brooks-LaSure and Secretary Becerra,

    Thank you for providing us with the opportunity to share our views on Medicare Advantage (MA) data gaps and needs in order to make critical improvements to MA. Like you, our goal is to promote health equity, protect enrollees, and ensure the fiscal integrity of the Medicare program. Right now, with limited, untimely and incomplete MA data, these goals are a pipe dream.

    This response to the MA Data request for information is submitted on behalf of the below signed organizations and individuals representing a wide and diverse swath of stakeholders. We believe that critical data gaps today undermine MA accountability and allow bad actors to gouge taxpayers, erode the Medicare Trust Fund, endanger the lives and well-being of older adults, and discriminate against Black, Hispanic, Pacific Islander, low-income and critically ill older adults and people with disabilities.

    We salute CMS for trying to enhance enrollee protections in MA but, without better data, there is no way to protect people from plans that do not honor their obligations to cover Medicare benefits and other contractual obligations. CMS cannot cancel their contracts or penalize them appropriately. CMS cannot warn people about MA plans with unconscionably high denial rates, inadequate networks, or high mortality rates. Unfortunately, the available data suggests there are far too many of them.

    We agree with you that we should “have, and make publicly available, MA data commensurate with data available for Traditional Medicare to advance transparency across the Medicare program, and to allow for analysis in the context of other health programs.” Not only is that not the case today, but we know from MedPAC that insurers have never met their obligation to release complete and accurate encounter data. That failure alone indicates either an inability of insurers to effectively manage care, or a blatant disregard for the value of this data for effective oversight, or perhaps a desire to hide the data to avoid appropriate accountability for their bad acts. Whatever the reasons, it is essential that any and all data requirements from insurers be fashioned in ways that ensure their complete, accurate and timely collection and impose appropriate non-discretionary penalties for insurers’ failure to provide the data.

    Without complete, accurate and timely plan-level data, adequate resources for oversight and meaningful penalties for noncompliance, the MA program has become an ATM for the health insurers offering MA plans. This makes the MA program a dangerous choice for older adults and people with disabilities who too often wrongly assume what they are told — that they will get the Medicare benefits to which they are entitled. Further, it makes the MA program an administrative nightmare and a financial risk for providers. If Congress and the administration do not have the tools to identify and punish insurers who withhold Medicare-covered services from MA enrollees or otherwise discriminate against them, they should acknowledge the MA program’s vulnerability to corporate crime and serious or deadly enrollee harm — and overhaul or end the program.

    Recently CMS chose not to call for more detailed data reporting from MA insurers. Rather, it said that “reporting at the specialty level and service level could be overwhelming because of the volume of information presented.” If CMS cannot manage the collection and analysis of granular data to police the insurers offering MA plans effectively, CMS should publicly disclose those constraints and their dangerous consequences, call upon Congress for the needed resources, and warn enrollees upfront and clearly of its inability to protect them from bad actor insurers who have the ability and the financial incentive to deny them needed care.

    We detail below some of the most critical data gaps and needs to prevent the MA program from offering choices to older adults and people with disabilities that no one should have to make, gouging taxpayers and the Medicare Trust Fund, and disrespecting the financial and administrative needs of providers. Before we do, we want to underscore our shared goal with the administration of promoting health equity and the need for a lot more MA data to accomplish this goal.

    That said, if the government simply requires more MA data without robust oversight and non-discretionary penalties on insurers for non-compliance, the requirements would be of little value. The government must use the data to oversee the MA insurers and hold the bad actors accountable for their bad acts in meaningful ways.

    Moreover, if the government simply expects beneficiaries to make sense of volumes of Medicare data to protect themselves against bad actor MA plans or to appeal systemic inappropriate denials of care in order to get the Medicare benefits to which they are entitled, it is promoting health inequities. If the government allows MA plans to hide the data revealing that lower-income enrollees and communities of color are going without needed care because of administrative and financial burdens and inappropriate denials, it is promoting health inequities. CMS must keep bad actor MA plans out of the program and reform the MA program to minimize harm to enrollees.

    In a sadly apt comparison, the Boeing aerospace corporation was allowed to continue its money-saving profit-centric business model that led to the needless deaths of many people before Boeing was forced to suffer material consequences. We have mounting evidence that the worst performing MA plans are behaving similarly, with arguably far more horrific consequences both for their tens of thousands of enrollees and for the Medicare program writ large. And no one is yet identifying these bad actors, let alone stopping them.

    Inadequate provider networks and misleading directories cause harm

    The government cannot protect people enrolled in MA if it cannot block MA plans with inadequate networks or prevent sales agents from misleading people about networks. Today, it cannot do either, even though CMS “requires” insurers to offer adequate networks and restricts the activities of MA sales agents. Consequently, people sign up for MA plans thinking they will get the care they need from the physicians and hospitals they want or need to use and too often find they are not covered for their care from those providers. The network provider directories are inaccurate. They often can’t use a cancer center of excellence. Or, they can’t see a physician at a convenient location. Or, all of the nursing homes in their network are of poor quality. As you know, the plight of enrollees who need costly care is all the worse for Black and Hispanic people, low-income people and people in rural communities—promoting grave and unconscionable health inequities.

    CMS allows insurers to offer MA plans with different networks in a contract and only collects network information at the contract level, preventing it from ensuring network adequacy. CMS likely lacks the resources to oversee more than 4,000 MA plans effectively. To protect enrollees, this cannot continue.

    CMS could require insurers to offer the same provider network to all MA plans in a contract. That requirement would simplify oversight of network adequacy and provider directories. It also would help promote health equity, prevent provider network discrimination, and allow for more meaningful plan choice.

    The simplest way for CMS to collect accurate provider network data would be to create a central web portal on which all providers are required to list their MA plan affiliations. Insurers would then be responsible for ensuring accuracy and could penalize network providers who were not listed. People could far more easily compare MA plan networks.

    The best solution would be for CMS to require all MA plans to eliminate their networks and cover all willing Medicare providers at the Medicare rate.

    Again, whatever CMS chooses to do, it is of no use if the insurers do not have adequate networks. It is of no use if the insurers are not accountable for failing to provide accurate provider information less than 95 percent of the time or failing to have adequate networks. CMS should impose a non-discretionary meaningful penalty on these insurers in the form of a lower star rating, an X or other warning about the plan on its web site or a requirement to stop all marketing. Insurers should be held strictly liable for their errors. Enrollees should not be their victims.

    Additionally, as the Center for American Progress recommends, “CMS should ensure there are explicit protections that would allow for an enrollee to change MA plans or return to TM without being subject to medical underwriting for supplemental Medigap policies if their MA plan directory was inaccurate at their time of enrollment. For example, CMS can clarify that if an enrollee makes such a discovery, it should be considered a misleading MA practice and accordingly trigger a Special Enrollment Period (SEP) for supplemental benefits.”

    Proprietary and non-evidence-based prior authorization rules cause harm

    If MA prior authorization rules have health benefits, insurers should share them openly and freely use them. If not, insurers should be penalized heavily for using them, especially in cases where people’s lives and health are at serious risk, such as for cancer patients. Otherwise, Congress and the administration cannot protect Medicare Advantage enrollees from grave harm.

    For this reason, CMS must require insurers to disclose all prior authorization requirements they intend to use, and CMS must pre-approve them based on evidence. Penalties for non-compliance should be severe and non-discretionary. Insurers should be stopped from making people with Medicare their victims.

    To truly protect people, CMS should dictate the prior authorization rules that MA plans are permitted to use. Specifically, CMS should create a standardized prior authorization system that applies to all MA plans. Only a standardized system will promote health equity and allow people to make an informed MA choice.

    For now, in its insurer contracts, CMS should prohibit insurers from using different prior authorization rules for enrollees depending upon the MA plan they are enrolled in. There is no good rationale for allowing an insurer to discriminate against people in some MA plans through use of more prior authorization rules than other MA plans. Either prior authorization is beneficial and clinically sound or it is not.

    Recent CMS prior authorization rules are a good first step. But, without more details and non-discretionary penalties for plans that apply PA inappropriately, history and experience suggest that insurers will ignore such rules. To repeat, the only way for CMS to ensure MA enrollees get the same Medicare benefits as people in TM — and protect MA enrollees from deadly delays and denials of care as a result of PA — is for CMS to set standardized PA rules. To ensure and promote health equity, CMS should require insurers report PA denial and delay data by type of service and enrollee characteristic at the plan level.

    Insurers should also report MA plan level denials both pre and post treatment and in and out of network. CMS needs the information to ensure insurer compliance with Medicare coverage rules. Individuals need this information to avoid plans with high denial rates. Providers need this information to make informed choices about which networks to be a part of.

    Supplemental benefits are a gift to insurers who wrongly and excessively deny care

    Based on the existing evidence, it is all but certain that insurers are able to offer extra benefits and still profit handsomely because of the money they save from denying care inappropriately, keeping enrollees from seeing high quality providers, attracting a disproportionate share of healthy enrollees and creating incentives for enrollees with costly conditions to disenroll.

    CMS should automatically forbid plans with denial rates above 10 percent in the prior year from offering supplemental benefits. While this would likely mean fewer supplemental benefit offerings, as the Center for American Progress says, “The little research that is available suggests that MA plan coverage for dental, vision, and hearing services has not resulted in improved access for beneficiaries.”

    Immediately, along with the Center for American Progress, “We recommend that CMS collect and publish utilization and OOP spending data for all supplemental benefits, disaggregated by enrollee race, ethnicity, gender, income level, and other important demographic characteristics, at both the plan and beneficiary level. This information should be stratifiable by benefit transaction/service type. We also recommend that complete data on the use of prior authorization for supplemental benefits, including rates of denials on PA requests, be reported to CMS and made publicly available.”

    High disenrollment or mortality rates should disqualify an insurer from offering an MA plan

    CMS should require insurers to report MA plan-level disenrollment and mortality rates. The data should be broken down across demographic and health characteristics of the people who disenroll or die and should be publicly reported. Disproportionately high rates automatically should trigger cancellation of MA contracts. High rates should also trigger lower MA star ratings. Given that some plans have excessively high denial and mortality rates, people choosing an MA plan can only make a meaningful choice with this information. Star ratings that do not meaningfully reflect excessive mortality rates are a cynical perversion of quality methodologies.

    Out-of-pocket costs force people into debt and to forgo care

    CMS should collect and report plan level data on the number of people forgoing critical care based on cost or care denials. How many people in MA are forgoing critical care as a result of high out-of-pocket costs that their MA plan imposes? How many of them are low income, in poor health or are Black or Hispanic? How can CMS promote health equity without this information?

    CMS should collect and report plan level out-of-pocket costs by health condition. What are people’s out-of-pocket costs if they have cancer, suffer a stroke, or need rehab? How can people make an informed choice of an MA plan without this information?

    CMS should collect MA plan-level data to promote health equity

    CMS needs MA plan-level data to promote health equity or it needs to forbid insurers from offering more than one MA plan in a contract area.

    To echo the Center for American Progress, “CMS should consider including some dimension of equity as part of the MA star ratings program, which at the very least could be a reflection of whether MA plans are collecting adequate and stratifiable data.” And, “CMS should prioritize making any necessary adjustments to its race and ethnicity data collection processes given how central accurate underlying data is to the validity of monitoring for inequities.”

    Without oversight and enforcement, data requirements are virtually useless

    We know that tens of thousands of people each year in MA, if not hundreds of thousands, are dying needlessly or suffering greatly because Congress created a program that is impossible to oversee and the insurers have become so big and powerful, both legally and politically, that they can design their MA plans to maximize profits and violate contracts with near impunity.

    The data on health insurance violations reported on violationtracker.org speaks volumes.

    No other wealthy nation allows health insurers to behave as they will to deny and delay care or otherwise restrict care access as MA insurers are able to do. No other wealthy nation provides insurers with an incentive to maximize profits on the backs of their enrollees. Rather, they dictate when, how and where care is covered—and the price. That’s the way to ensure insurers do their job appropriately and protect people.

    A lot more data is urgently needed for adequate oversight. But, without tens of billions of dollars more, CMS will not be able to conduct effective oversight and enforcement. Insurer abuses will persist and vulnerable older adults and people with disabilities will suffer. Only much tighter regulation and non-discretionary automatic penalties for non-compliance will promote health equity and ensure MA enrollees get the care to which they are entitled.

    Conclusion

    This year alone, the government is projected to overpay insurers offering Medicare Advantage plans between $83 and $127 billion, wasting taxpayer dollars and driving up Medicare premiums, indicating serious design defects in the government’s capitated payment structure. Moreover, notwithstanding critical missing data, mounting evidence reveals serious deficiencies in MA’s coverage design, resulting in untold harm to a significant number of enrollees who need critical care.

    Rules and regulations, limited resources, and corporate health insurer power have kept CMS from collecting critical data, auditing plans adequately, and enforcing penalties. Rather, MA is growing quickly, and few people enrolled appreciate that they are taking a big gamble with their health. Medicare Advantage saves money for healthy people, but comes with serious costs and major limitations for the most vulnerable. Instead of pooling and spreading risk, the MA model allows insurers to fragment risk, burdening the sickest; the opposite of a proper insurance design.

    Traditional Medicare is far from perfect and needs improvements, including an out-of-pocket cap. But, it is far more cost-effective than MA. In sharp contrast to MA, Traditional Medicare pools and spreads risk. It is designed to ensure that the 10 percent of enrollees responsible for 70 percent of Medicare spending have quick and easy access to needed care. Traditional Medicare does not create obstacles to care, or second-guess enrollees’ treating physicians in order to maximize profits, much less withhold data in order to prevent appropriate oversight.

    We know that political pressures can prevent dramatic action, often when it is most necessary. We hold Congress largely responsible for refusing to act in meaningful ways to reform MA. And, we thank CMS for calling on the public to bring attention to MA’s limitations, as well as for improving MA as best it can, given so many constraints.

    We hear the nightmare Medicare “Disadvantage” and “Take Advantage” stories on the ground and struggle to sleep at night, concerned for the millions of vulnerable Americans who can’t afford supplemental insurance in TM and have no clue of the challenges they are likely to face in MA when they most need care. We will continue to highlight MA’s inequities and defects and advocate for major reforms to the program, alongside the Office of the Inspector General, the Government Accountability Office, the MedPAC, the Committee for a Responsible Federal Budget, the American Hospital Association, a growing number of Congresspeople and myriad others. We promise that we will not stop speaking out until the day our representatives in Congress unite to pass legislation that will protect MA enrollees and the fiscal integrity of the Medicare program.

    In the meantime, we appreciate your consideration of our comments. For any questions regarding this comment letter, please contact Diane Archer at [email protected].

    American Economic Liberties Project
    Be A Hero
    Center for Economic and Policy Research Center for Health and Democracy
    Center for Medicare Advocacy
    Just Care USA
    People’s Action
    Physicians for a National Health Program
    Public Citizen
    Puget Sound Advocates for Retirement Action
    Social Security Works
    Dr. Don Berwick, Former Administrator of the Centers for Medicare and Medicaid Services (CMS)

  • CMS should not be hiding Medicare and Medicaid data

    CMS should not be hiding Medicare and Medicaid data

    Researchers are up in arms against a plan to restrict access to Medicare and Medicaid data by the Centers for Medicare and Medicaid Services (CMS), which oversees Medicare and Medicaid. The CMS plan will make it harder for researchers to access and analyze Medicare and Medicaid data as they please. This data is critical for understanding what’s working and not working in our health care system for different populations and in different geographic areas, explains Ge Bai, a professor of accounting and health policy at Johns Hopkins in Forbes.

    Medicare and Medicaid data reflects health care usage by 4o percent of insured Americans, allowing researchers to report on how well our health care system is working for different populations. But, CMS just announced that it’s ending the ability of institutions to use Medicare and Medicaid data freely, easily and inexpensively. Rather, it will charge more for this data and impose many more restrictions on its use. CMS plans to begin this new policy in 10 weeks.

    As it is, CMS is not collecting key Medicare Advantage data that would help researchers better understand the care people are receiving in their Medicare Advantage plans.

    Bai outlines three serious implications of this new CMS plan.

    1. It will be harder for researchers to study Medicare and Medicaid, so less research will occur. This will limit government accountability and shield CMS from public scrutiny. We need external oversight to ensure CMS ensures Medicare and Medicaid are working as well as possible. External analysis of data will always add a new array of insights and solutions for improving Medicare and Medicaid and the health of older adults and people with disabilities and low incomes.
    2. It will end a lot of research by independent entities. Already today it is too expensive for smaller entities to access CMS data. The administration will control the narrative about the data.
    3. Cronies will benefit from requiring the purchase of data at a high price from CMS.

    CMS claims that it is concerned about data breaches but has not indicated that researchers’ use of the data has led to breaches. Moreover, CMS could easily do more to minimize the likelihood of breaches without restricting access to data and harming the public good.

    CMS is undermining data transparency in its own agency at the same time that it is requiring more transparency from hospitals and other health care stakeholders. How does this promote competition?

    CMS claims to own the Medicare and Medicaid data, but in truth the public owns it. CMS is charged with collecting data. But, the public cannot assess CMS’ work without access to the data. Of course, it can be deidentified.

    For the good of Medicare and Medicaid and the people who benefit from it, CMS should make all its data easily available to researchers at a fair price.

    Here’s more from Just Care:

  • Mental health treatment remains challenging to come by, even with insurance

    Mental health treatment remains challenging to come by, even with insurance

    Notwithstanding federal law requiring “mental health parity”–insurance coverage for mental conditions–mental health treatment remains hard to come by in the US. Even with health insurance, the majority of Americans in need of treatment for a mental health condition could not get it in 2021. If you have Medicare, few health care providers are willing to treat you because Medicare’s rates are so low, and the data suggest that Medicare Advantage plans do a poor job of including mental health providers in their networks.

    About one in five people in the US have a mental health condition. But, only a small minority of them are able to get treatment for their conditions. Fewer than one in seven people with Medicare–15 percent–receive treatment for mental health conditions.

    A story on NPR, based on a new Milliman report, explains that about two in three Americans with health insurance could not receive treatment for their mental health conditions. Of the people experiencing mental health crises who required emergency treatment or hospitalization, only one in three got follow-up treatment within 30 days of leaving the hospital.

    Inseparable, an advocacy group focussed on the treatment of mental health conditions, commissioned the Milliman report. Its founder, Bill Smith, wanted to see the data underlying the endless stories his group was hearing about insurance companies refusing to cover mental health care.

    What keeps people from getting treatment for mental health conditions? In addition to a health insurance industry that does not want to cover the care, there’s a shortage of workers, poor provider reimbursement rates, and government failure to ensure compliance by insurance companies to cover mental health care as required under federal law.

    Milliman’s findings show that almost one in four people with insurance, including Medicaid, Medicare and commercial insurance, had a minimum of one mental health condition in 2021. People with Medicaid had the highest likelihood of receiving mental health care.

    Here’s more from Just Care:

  • Bi-partisan group of Senators call for better Medicare Advantage data to protect enrollees

    Bi-partisan group of Senators call for better Medicare Advantage data to protect enrollees

    In a letter to the CMS Administrator, Senators Elizabeth Warren, Catherine Cortez-Masto, Bill Cassidy and Marsha Blackburn call for better Medicare Advantage data collection and reporting. Lack of good Medicare Advantage data prevents the Centers for Medicare and Medicaid Services (CMS) from effectively overseeing and reforming the Medicare Advantage program and make it impossible for people with Medicare to make a meaningful choice of a Medicare Advantage plan, let alone protect themselves from the bad actor Medicare Advantage plans.

    “[I]n the last few years, federal watchdogs have released numerous reports examining concerning trends in MA… These findings raise important questions about ensuring the integrity and fiscal sustainability of the Medicare Advantage program. Without publicly available plan-level data on prior authorization requests by type of service, timeliness of determinations and reasons for denials; claims and payment requests denied after a service has been provided; beneficiary out-of-pocket spending; and disenrollment patterns, policymakers and regulators are unable to adequately oversee the program and legislate potential reforms,” wrote the senators.

    The Senators have it almost right. All this data is needed. Unfortunately, even if it were realistic to expect that the MA plans would release data of this nature, the data they do release is never complete, accurate or timely, reports the Medicare Payment Advisory Commission. Moreover, because each MA plan is permitted to handle the prior authorization process differently, using proprietary tools, it is impossible for the Centers for Medicare and Medicaid Services to oversee the MA plans effectively. Without a lot more standardization of claims processing in MA plans, the MA plans are free to engage in bad acts, such as denying claims inappropriately, with little chance they will be caught, let alone held to account.

    In sum, people do not have the information they need to choose among Medicare Advantage plans. MA plans have failed to turn over complete and accurate patient encounter data for years, with impunity. Without this data, it is not possible to assess quality of care in Medicare Advantage and how well an MA plan performs, as the Medicare Payment Advisory Commission (MedPAC) has said repeatedly.

    The most important question to ask yourself if you’re in a Medicare Advantage plan or thinking of joining one is: Will I get the care I need when I most need care–be it hospital care, rehab services, cancer treatment, nursing or home care. Do not assume you or your loved ones will. Unfortunately, in Medicare Advantage, there’s no telling. Some Medicare Advantage plans deny high levels of medically necessary care or delay care to the serious detriment of their enrollees. The data is missing to tell you which ones to avoid. And, the government cannot protect you from the bad actors.

    The Senators’ letter to the CMS Administrator explains that the Office of the Inspector General has found widespread inappropriate Medicare Advantage prior authorization denials and payment denials. And, the General Accounting Office has found that people who are in the last year of life are twice as likely to disenroll from a Medicare Advantage plan and switch to traditional Medicare. Most people are locked into a Medicare Advantage plan once they join because the supplemental coverage people need to protect themselves financially in traditional Medicare, which lacks an out-of-pocket cap, tends to be unavailable or unaffordable.

    In their letter. the Senators also note that overpayments to Medicare Advantage plans need fixing. These overpayments have been estimated to be as high as $140 billion this year alone. They are eating into the Medicare Trust Fund and driving up Part B premiums for everyone, significantly. The Committee for a Responsible Federal Budget projects as much as $250 Billion in additional Part B premiums over the next ten years if the overpayments are not corrected.

    In addition to complete encounter data, the Senators are urging CMS to collect and report the following:

    1. Prior authorization requests, denials, and appeals by type of service. Among other things, collecting this data would permit assessment of whether MA plans are covering all Medicare Part A and Part B services, as required.
    2. Justification of prior authorization denials. With this information, CMS could better determine whether denials are appropriate.
    3. Timeliness of prior authorization decisions. 
    4. Utilization of supplemental benefits and associated out-of-pocket costs. Right now, it is not clear who is using these benefits or what they are paying. With this information, CMS could determine whether they have real value.

    CMS collects other data that the Senators want CMS to publicly report, including:

    1. Out-of-pocket costs and provider payment information. 
    2. Disenrollment data broken down into subgroups. This information would help the public understand whether people are leaving MA because of the cost of care or the inability to get needed care.
    3. Plan comparison information in MA and TM, including health outcomes.

    Here’s more from Just Care:

  • Can we fix our broken health care system without reining in costs?

    Can we fix our broken health care system without reining in costs?

    Aaron Carroll writes for the New York Times about how to fix our broken health care system.

    Notwithstanding all the ways the Covid-19 pandemic exposed fissures in our health care system, bringing with it more than one million deaths, Congress is doing precious little to address uninsurance and underinsurance and their consequences for our health and well-being.  Carroll studied health systems in five other wealthy countries to appreciate differences between them and the US. Carroll suggests that universal health care is the solution to our broken system, whatever it looks like; he doesn’t see health care costs in the US as a stumbling block.

    We spend more per person on health care than any other country, and health outcomes are generally significantly worse than in every other wealthy country, including life expectancy. So, what does the United Kingdom, France, Australia and New Zealand do differently? They all guarantee health care coverage to their citizens.

    Carroll posits that in every other significant way these other wealthy countries are different from one another. But, these countries not only share guaranteed universal coverage. They all have a sets price for most health care goods and services. It’s that combination, along with significant restrictions on insurance company profits, that make health care affordable for their citizens.

    Australia, New Zealand and Canada all offer government-provided coverage,  sometimes called single-payer.  Australia and New Zealand’s single-payer systems allow people to buy private insurance to improve their access to care. Canada does not allow that.  Australia’s system requires people to contribute significantly to the cost of their care.

    Carroll says France’s system is not quite single-payer because people get their coverage through different systems. But, it is primarily with government funding, either through their jobs or some other means, and with significant government rules and regulations. France requires people to pay upfront for their outpatient care and then reimburses them for the cost.

    Britain likely offers the most robust coverage of all these countries. Most services come with no out-of-pocket costs. Britain’s system is different from single payer because it is not insurance-based. Rather, the government employs physicians and owns hospitals and covers people’s care directly.  The British system is socialized medicine. While people can have private insurance for enhanced benefits, almost no one does.

    Singapore offers everyone only catastrophic coverage for high-cost services. People can buy private insurance to supplement the public coverage, but few do.

    Carroll acknowledges that public hospital systems in all these countries make a huge difference in improving access to care, eliminating competition for profits. It seems hard to imagine how the US moves to that system to reduce costs and improve access, given the very limited number of public hospitals here. Is there any way to open up the Veterans Administration hospitals to all Americans? And, even if there were, would that give people living in remote areas adequate access to care?

    Carroll points up that housing, food and education also contribute significantly to better health. Other countries invest in these “social determinants of health.” The US does not, but we could.

    Carroll suggests that if we allocated some of our health care budget to the social determinants of health, we would likely see far better health outcomes. But, we are currently on the reverse trajectory, cutting this discretionary spending, such as food stamps. With all the money we invest in health care, Carroll has hope of realigning these investments. He thinks it’s simply a matter of political will.

    Here’s more from Just Care:

  • What we don’t know about Medicare Advantage plans

    What we don’t know about Medicare Advantage plans

    The Kaiser Family Foundation just released a report detailing the many data gaps in Medicare Advantage–the corporate health plan option administered by private health insurers. This missing data is needed to assess Medicare Advantage plan performance and value.

    The government requires relatively little data from the Medicare Advantage plans and does not make much of it available for public scrutiny. Moreover, some of the required data is inadequate or incomplete, Yet, the Centers for Medicare and Medicaid Services, which oversees Medicare, rarely holds the Medicare Advantage plans accountable for failing to provide accurate data.

    Congress needs to step in to require MA plans to turn over data that people can use to make an informed choice of a Medicare Advantage plan if they’d like. And, it needs to include penalties for Medicare Advantage plan failure to disclose complete and accurate information.

    Here are some of the questions for which we have no answers:

    • Which plans have the highest rates of denials and which have the lowest?
    • Which plans have the highest rates of prior authorizations and for which types of services?
    • How quickly do Medicare Advantage plans respond to prior authorization requests?
    • Why do Black Medicare Advantage enrollees disenroll from Medicare Advantage plans and why do white enrollees disenroll?
    • What share of enrollees use the “extra” Medicare Advantage benefits and what is their income, ethnicity and health status?

    The Centers for Medicare and Medicaid Services (CMS) does not have the answers to any of these questions. Without the answers, CMS is forcing people to take big risks when they join a Medicare Advantage plan. How can anyone assume that any particular Medicare Advantage plan offers value or will provide them with the care they need. For example, CMS does not require the Medicare Advantage plans to report the types of services for which there are high levels of prior authorization requests and denials.

    The insurers offering Medicare Advantage plans also do not have to distinguish among the plans they offer when they do provide data to CMS. So, if some of their plans have particularly high denial rates and others have low rates, CMS would not know.

    Bottom line: There is no way for people to make an informed choice about a Medicare Advantage plan.

    Here’s more from Just Care:

  • Medicare Advantage plans fail to release data required for oversight

    Medicare Advantage plans fail to release data required for oversight

    A recent MedPac presentation details several glaring issues with Medicare Advantage, of which both Congress and all Medicare Advantage enrollees should take careful note. MedPac cannot assess quality of care in Medicare Advantage, the private health plans that cover care for about half of all people with Medicare. The Medicare Advantage plans are not releasing complete and accurate data to enable appropriate oversight, nor is the Centers for Medicare and Medicaid Services (CMS) holding them accountable for failing to do so.

    Medicare Advantage plans have failed to disclose complete and accurate data, as they have been required to do, for the last 10 years. Encounter data shows the services people are receiving. And, it is needed for MedPac, the agency that oversees Medicare payments, to assess MA plan quality. According to MedPac, the Medicare Advantage quality data available is not meaningful.

    CMS, which oversees Medicare Advantage (MA) plans, has not held MA plans accountable for failing to disclose this data. Consequently, MA plans have little incentive to provide complete and meaningful encounter data. MedPac has spelled out what CMS should do, but CMS has not acted to create the appropriate incentives.

    Medicare Advantage plans claim to spend $50 billion on additional benefits for their enrollees in 2021, but there is no good information on how that money is spent. Rather, we know that too often these additional benefits come with high out-of-pocket costs and can be difficult to access.

    MedPac recommends that CMS withhold payments to Medicare Advantage plans that do not release complete and accurate encounter data so that they have an incentive to do so. Alternatively, if necessary, Medicare should require Medicare Advantage providers to submit their claims data to an intermediary, who could then ensure it was complete and accurate.

    In 2021, Medicare Advantage plans received $350 billion dollars from CMS. It boggles the mind that the government has little reliable data on how Medicare Advantage plans are spending that money and enrollees know so little about the quality of care they offer

    Here’s more from Just Care:

  • Medicare: 2020 facts and figures

    Medicare: 2020 facts and figures

    Today, Medicare covers 65 million older and disabled Americans. What does that mean for the US budget, national health care spending and the future of Medicare? A new Kaiser Family Foundation interactive, the facts about Medicare spending, takes a deep dive into the 2020 data.

    One in five Americans now have Medicare. And, although people with Medicare use three times more health care services than younger people, Medicare represents 20 percent of national health care spending. Traditional Medicare, which covers slightly more than half of the Medicare population is extremely cost-effective, with less than two percent of its budget going towards administrative costs. In sharp contrast, Medicare Advantage plans take 15 percent of their budget for administration and profit.

    About one-eighth of the federal budget–$769 billion–covers Medicare costs. In 20 years, those costs have almost quadrupled. And, projections are that Medicare costs will double in the next ten years because the Medicare population is growing, as are health care costs. By 2060, there will be 93 million people with Medicare.

    What does Medicare cost per enrollee? Each person with Medicare cost an average of $14,400 in 2020, up from $5,800 in 2000.

    Why is Medicare growing so much? People are living longer. There are more people 80 and older, and, by 2060, they will represent one-third of the population over 65.  Today, they represent about one-fourth the population over 65. Of note, the percentage of people over 90 will double, from 5 percent of those over 65 today to 10 percent in 2060. (The Kaiser paper does not speak to the high cost of Medicare Advantage, which has already cost Medicare over $100 billion more than traditional Medicare and is projected to cost an additional $600 billion over the next nine years.)

    Where is Medicare spending highest? Today, nearly half of all Medicare spending (48 percent) happens under Medicare Part B for outpatient services. Inpatient services under Medicare Part A represent 40 percent of Medicare spending. Prescription drugs represent the remaining 12 percent.

    Medicare Advantage spending is growing faster than traditional Medicare, eating into the Medicare Trust Fund. Today, the government spends about four percent more per person in Medicare Advantage than in traditional Medicare.

    How much are people with Medicare spending out of pocket? People with Medicare are spending a lot more out of pocket than they used to. Over the last 2o years, out-of-pockets costs have gone from about 15 percent of the average Social Security benefit to 19 percent. Medicare premiums represented 6 percent of people’s average Social Security benefit in 2002; they now represent 10 percent.

    Consequently, people with Medicare–most of whom rely heavily on Social Security to make ends meet in retirement–have increasingly less to spend on other necessities.

    The Part A Trust Fund, which pays for inpatient care, is projected to stop being able to pay full benefits as of 2026. At that point, it will only be able to cover 91 percent of those benefits, unless Congress steps in, which it has always done.

    Here’s more from Just Care:

  • How Connecticut Eliminated Capitated Managed Care in Medicaid

    How Connecticut Eliminated Capitated Managed Care in Medicaid

    A talk presented by Sheldon Toubman, then with New Haven Legal Assistance Association edited Transcript – February 2019

    In 2012, Connecticut replaced managed care organizations (MCOs) in its Medicaid program with a program of “managed fee for service”. Enhanced care coordination for all Medicaid recipients became an important part of this program, which has reduced Medicaid spending and provided better service to patients. In this talk, presented to the PNHP-NYMetro Research/Study Group, Sheldon Toubman, then at New Haven Legal Assistance, describes the process by which it happened.

    I have been a legal aid lawyer with New Haven Legal Assistance for almost 28 years and other programs for three years beyond that [since August 2021, Toubman moved to Disability Rights Connecticut]. For most of that time, I have been focusing on the Medicaid Program.

    In that role, I came of age in Medicaid advocacy in Connecticut in 1995 as the state was moving from the traditional Medicaid fee for service program, where the provider provides the service and they then bill for the service, to what other states were increasingly doing at the time, a capitated managed care system in which the state pays a fixed amount of money per member per month for health care services.

    I will give you the background of what we had in Connecticut, the strategy that advocates came up with, and then where we are today. It was seven years ago, January 2012, that Connecticut made the transition to what I call “managed fee for service”, or single payer. We’ve now had seven years of experience and I can tell you exactly what we’ve gotten for our money. Recognize that Connecticut is rather unusual. There are only four states that don’t have capitated managed care running their Medicaid program as you do in New York.

    So, when the capitated managed care model rolled out, there were eleven MCOs, Managed Care Organizations. We were told that the state was going to save money by paying them 95% of what we would otherwise have paid for the same health services under Medicaid. You won’t be surprised that the managed care industry managed to convince the state not to reduce its fees, but to pay it 100% of current spending. And you’ll not be surprised to hear the industry said that actually it’s not getting enough, so it needs more money, even though the whole premise was that it’s going to save money. (I should say that this was for our family and children population, not the elderly and disabled population, which is a sicker population; generally, family, kids and pregnant women are healthier populations. That is the group that was in the managed care system.)

    This dynamic started right away — they were always demanding more money, but the state had become dependent on them.

    The MCOs also argued that they were going to improve care because they are uniquely in a position to coordinate care. This is especially noteworthy because there is always a complaint from Medicaid recipients that their care is uncoordinated, that they see a lot of different doctors and nobody is watching out for them. So MCOs would say they’re going to coordinate care so that the state saves money, improves access to care, and thus improves the quality of care.

    However, in practice, what we saw constantly was routine lack of access to services. It was horrendous in the case of behavioral health, where kids who had been abused would be told they get a limited number of sessions and, if their provider was willing, they could beg for more. These abusive practices were partly a function of the fact that the MCOs subcontracted with other capitated insurance companies, so if the MCO was getting, say, $200 a month for all health care, they could contract for $11 a head to a specialized for-profit company to provide behavioral health, and those companies were even worse in restricting access to care.

    The basic problem with capitated MCOs is the same as with commercial insurance: every dollar of health care they provide comes out of their pocket. So the incentives were pretty obvious. Their messaging in response was always, along the lines of: “Don’t worry about that. Yes, it seems that way, but if they get sick, it’s on our dime. If somebody’s not taken care of and they end up in the hospital, we have to pay for that. So we have a real incentive to coordinate care and make sure that bad things like that don’t happen. We’re going to keep people healthy.”

    The reason that was false is, first of all, these are mostly for-profit, publicly-traded companies. All they care about is how well they’re doing this quarter. So if they can keep someone’s diabetes under control and keep them out of the hospital next year or the year after, that’s interesting but it’s not relevant to what they’re trying to do. They’re trying to profit right now.

    Second, people move from one plan to another, and so it may save money only for another plan, so they don’t see the benefit. The consequence is that they never did the things they said they would do. They never coordinated care. They never did the kinds of things that were necessary to prevent complex conditions from developing. And even on basic measures, like the Early and Periodic Screening, Diagnostic and Treatment requirements of federal Medicaid law, they were doing abysmally.

    And then there was dental access, which was terrible. There was pharmaceutical access, which was terrible. At some point, advocates decided that the basic financial model, where they make money by denying care, was just not going to work. There was no way we were going to reform that basic economic model and make it work for our clients.

    We started with a lawsuit. In 1999, we filed a class action suit against HealthNet and the state, which is ultimately responsible for all Medicaid services even if contracting with MCOs. Our specific allegation was that they were not compliant with due process. They were constantly denying services, but patients were not getting written notice of it. They learned about it because their doctor would say, “I tried to get approval, but they wouldn’t grant it.” There was no written notice to the patient of what the decision was, why it was decided and, more importantly, their right to appeal. These basic rights apply to all state and federal government benefit programs.

    So we brought a lawsuit saying they weren’t providing written notices and in the few cases where they did, the notices were grossly defective. For example, in one case the reason given for being denied was you don’t meet our company’s criteria, unspecified.

    One of the things we uncovered is that, routinely, people would be denied drugs which were covered under Medicaid and therefore covered under these contracts with MCOs. When they were denied, even when they were sent the written notice, it said the drug is not covered for you, which was not true. The drug was simply not on their formulary, which means the prescriber had to go through prior authorization, but it didn’t say that. It was basically a substantive access issue created by misrepresentation of the rules. So our lawsuit included this issue.

    One of the things we did with the lawsuit was to get a lot of media attention. This was the first class action suit ever brought in this country against a Medicaid-contracted insurance company. (Most of the time, people just sue the state; they don’t sue the insurance companies.) Press was really important because insurers really care about bad publicity. They are in a competitive marketplace, especially if they’re in the commercial sphere as well as the Medicaid world. They worry about their name, and their brand. They don’t want to be associated with problems. So we did a lot of press focusing on one MCO, but we also talked about problems with other MCOs as well.

    Advocates emphasized that this system is a black box. No one can tell what they are doing. We know people are routinely being denied service, because they come to our office and tell us that. Getting data on dollars and numbers of denials was really difficult, and the state couldn’t even get the information. So, one of the things that happened that we were involved in was finding some other avenue.

    We started focusing on recipients’ lack of access to providers, meaning that they just couldn’t find one. They couldn’t find a cardiologist, a neurologist. Various specialties just didn’t take Medicaid under any plan. This was a huge issue, related to low payment rates, i.e., specialists were being paid too little by the MCOs. So we wanted to get information about the rates paid. Someone filed a request under the state’s Freedom of Information Act, the open records law, asking for the payment rates for each of certain kinds of specialists, for each of a set of codes, for each of the MCOs.

    The state responded saying, essentially, “We don’t have that data and the Freedom of Information Act applies only to what’s in the possession of the state.” The state correctly said, “We don’t have the rates that the docs are being paid.” But we have in our state law, special to Connecticut and maybe to Pennsylvania, that a large, privately-owned contractor which is providing at least $2.5 million a year in services and is essentially performing a “governmental function,” that is, it taking on a role of government, is subject to that law. And that was really easy to show because the elderly and disabled populations in Medicaid were not in managed care, so all the things that the insurance companies were doing for the family population, the state itself was doing for the elderly and disabled populations, i.e., MCOs were performing that same governmental role. So advocates crafted a second Freedom of Information Act asking for the provider rates directly from the MCOs.

    In addition, parallel to the request for MCO provider rate information, advocates got involved in trying to get information about the numbers of pharmacy denials for lack of prior authorization. One of the ways insurances companies block access to drugs is they impose extra burdens and quantity limits for medication requests. We wanted to know how often does that happen. So we made a FOIA request essentially saying to the state, “If you don’t have the data, please get it from the MCOs. They have to provide it under the FOIA because they’re performing a governmental function in running a portion of the Medicaid program in general, and providing prescription drugs in particular.”

    This caused a firestorm. Initially, the state denied that the MCOs were performing a governmental function. We appealed that denial to the Freedom of Information Commission which enforces our open records law. It was a standing room-only hearing because the entire industry was really worried that we were going to have a situation where private parties would be subject to the law, and a Freedom of Information Act request could be submitted by anyone. That’s a scary thought if you’re a corporate entity

    Advocates got great media coverage about this, because the messaging was that these entities didn’t want to be accountable for how they spent the taxpayers’ money. They just want to take the money and not be accountable. And advocates said the state officials don’t want to hold them accountable either.

    We won before the Freedom of Information Commission, but it was appealed to the superior court by some of the MCOs. The state Attorney General then joined the side that was going after managed care organizations, which really annoyed the state agency. In any event, while this was pending, we put pressure on the governor, and there were op eds and editorials saying, “Yes, you should hold these state contractors accountable.” It got to the point where the governor gave up and said to the MCOs, essentially, All right, you’re going to be bound by this obligation, no matter what the courts say. You’re taking hundreds of millions of dollars in taxpayer money, so you should be accountable and we’re going to put it in the contract. Several of the big MCOs balked, so the governor pulled the trigger and basically said, “Okay, fine, you’re out of the program, but in the meantime, we’re going to turn you into non-risk entities.” That is, they would be administrative service organization contractors, not insurance companies taking financial risk. This was really important because this is what advocates wanted, and ultimately what they got, but not at this point. It was just temporary.

    The governor also said she was going to find other insurers which would accept this FOIA requirement. At about the same time, she decided to create a new subsidized program for lower income but non-Medicaid recipients called Charter Oak Health Plan, and she needed insurance companies to run it despite the uncertain costs of this new population. She went to the insurance companies and said, basically: If you agree to run my Charter Oak plan and take the risk, we’ll give you this very lucrative business of Medicaid clients. An RFP went out, and it did include that the insurers would be accountable under the Freedom of Information Act and they got three bidders. So, the three bidders agreed to contract on a risk basis, and advocates were back to square one, after they thought they had won.

    Advocates then started exploring how much the new companies were being paid. Whatever capitated rate the state pays a Managed Care Organization has to be approved by the federal Medicaid agency, and so they have to be audited. (Half or more of the state money paid to MCOs is actually federal money.) Advocates felt that the rate that the auditors found was acceptable was actually excessive. The state Comptroller then contracted with an accounting firm to come in to audit the auditors. They found the payments to the MCOs were at least $50 million/year too high. Advocates concluded they were being paid excessively through what was essentially a legal bribe from the Governor, to get them to run the Charter Oak business, which was her priority.

    Another thing that was happening under the earlier set of MCOs was that a group of pediatricians was focusing on the Medicaid provider network and the fact that it appeared to be bogus. That is, the list of doctors and other providers listed by the plans on their websites were not real, practicing providers or they were real people but were not really participating in the plans which listed them. So, these folks pushed to get a “secret shopper” survey done, where people got dummy Medicaid ID numbers and called up real providers and tried to set up real appointments for real medical problems. It was fictitious, but it sounded real to the office they were calling. The results were really disturbing and eye opening. For all of the MCOs, only about 25% of the time could people get an appointment, and the vast majority of times, the provider said, “I’m not participating in Medicaid” or “I’m not participating in Medicaid under your plan,” or “I’m not participating for new patients.” So, the vast majority of the time, the lists were bogus.

    This was really important because, about the same time this study came out, we finally received through the FOIA effort the provider rates that the MCOs were paying. Though they always claimed that they paid generously, it turned out they were mostly just paying the same low Medicaid rates already paid by the state under the rest of the Medicaid program. So the suspicions appeared to be correct that the reason specialists wouldn’t see these folks was because of the low rates.

    In addition, under the last set of MCOs, we started uncovering more misrepresentation of drugs being not covered when, in fact they just required prior authorization. Two very different reasons. When electronically denying drugs, two of the MCOs chose not to use the code which states the drug required prior authorization, which was the case, and, instead, used a code which said the drug was not covered at all. We emphasized that the MCOs were committing a kind of fraud, misrepresenting what is covered under the plan. So even though they were now subject to the Freedom of Information Act as a matter of contract, they were still misrepresenting what their coverage was in order to cut corners.

    At this point, advocates decided to offer an alternative, saying something like, “You know, this is not working. This capitated managed care for poor people is not working. Maybe we should do what some other states are doing.” The federal Medicaid statute offers an alternative type of managed care that doesn’t involve capitation at all. It’s called Primary Care Case Management. What this means is the state pays primary care providers extra to manage care. The MCOs always claim to manage care, but we all know they only manage cost.

    So, advocates suggested that Connecticut adopt, at least on a pilot basis, what other states like North Carolina and Oklahoma were doing, which is to pay primary care providers directly to coordinate care or manage care, paying them to actually coordinate care in a meaningful way. Advocates got a pilot plan through the legislature. It was very small, and the state Medicaid agency did not want to implement it, but advocates made a lot of noise about the fact they were not implementing it.

    Then, in 2010, we had a governor’s race. Advocates educated all of the candidates about the problems of managed care and we pointed out that this Primary Care Case Management (PCCM) model seemed to be working well in other states. We think that we should basically ditch this whole experiment with insurance companies. When Governor Malloy won in 2010, he set up various committees to develop issue briefs, and advocates lobbied those groups to lay out the PCCM option, emphasizing that capitated managed care wasn’t working, and was quite expensive.

    So, three weeks into his administration, in early 2011, Governor Malloy announced that he was going to show the door to the MCOs and adopt some form of Primary Case Care Management, using primary care providers to coordinate care, and also contract with an Administrative Service Organization (ASO), as the insurers had temporarily been turned into over the FOIA dispute. The ASO would take on some of the role that insurance companies play, but not on a risk basis, handling things like prior authorizations, recruiting providers, and so on. Behavioral health and dental services were contracted to different ASOs to manage those services, respectively, also on a non-risk basis.

    That announcement was made in February 2011, and an RFP was issued not too long thereafter. Connecticut chose a non-profit entity, Community Health Network of Connecticut, to take on that role. It used to be a not-for-profit, capitated MCO, and it was now being turned into an ASO.

    We then got involved in advocating for what the patient-centered medical home (PCMH) requirements were going to be for the PCCM-like program, because we were really going to use those to manage or coordinate care. We had to beef up the requirements on primary care providers and went with National Committee for Quality Assurance (NCQA) accreditation of PCMHs as the standard. They had to be accredited as a patient-centered medical home in order to participate and get paid extra for doing care coordination.

    That’s the basic history. Now, I want to fast forward to where we are today. It has not been absolutely perfect. There have been problems. But, overall, it has been a dramatic improvement, and the materials that have been distributed tell the story. Just in the hard dollars, in per member per month cost. (You don’t look at total costs under the Medicaid program in part because our program, like that of all the blue states, did a Medicaid expansion and those total costs have gone up substantially because there are a lot more people covered. Connecticut Medicaid member per month costs are down 14% from $706 in the first quarter of 2012 to $610 in the first quarter of 2018. So, that’s six years, and the costs went down. As a result, Connecticut, which is one of the highest health care cost states in the country — our per-enrollment costs had been the 9th highest, now they’re 22nd. So, we’ve actually done very well through this model in terms of total per member per month costs: To have costs go down when, in every state that has managed care, they always demand more money. To not have that hanging over you, if you’re a state agency, it’s pretty nice that you actually have control of the cost.

    The other question is, how much of those total costs are actually going to health care? As we all know, there are huge administrative costs that go into the private risk-based insurance system. When we had managed care companies, it was hard to get the data, but we found routinely 20%, even 25% or higher administrative overhead. We actually saw about 40% at one point for administrative costs for one of the plans, under the CHIP program. Based upon the data that has been available now for a few years, we have done really well on both the total costs and the medical loss ratio, which is now about 96.5% [97% as of 2021]. Only 3.5 cents on the dollar goes to administrative costs, paying for the ASO and the state’s own administrative costs. The rest is all going to health care. So it’s a win-win in terms of the cost and where the money goes.

    We really care about quality, about access to care. The data there is pretty good as well. Some really basic stuff like significant increases in preventive care, 16.3% from 2015 to 2017, hospital admissions per thousand down 6.29%, readmissions down 3.52%.

    There are several reasons, but one of them is the use of patient-centered medical homes. Close to half of our Medicaid population is now attributed to accredited patient-centered medical homes. They have the infrastructure for adequately coordinating care so people don’t end up in the hospital, and they provide routine care and the child visits and screenings and so on. Under the new system, the state has the data on what is being done and doesn’t have to beg an insurance company to give them the data.

    Though the primary responsibility for coordinating care lies with the primary care providers, the medical ASO (CHNCT) has done extra things to coordinate care. Their major program is called Intensive Care Management. This involves identifying people who are the frequent flyers, who go in and out of the ER frequently and need special attention, as well as individuals referred to the program. They have an aggressive outreach program where they literally go out to the people where they are in their community and try to get them in contact with their primary care provider. Ideally, it’s a patient-centered medical home, to make sure that going forward, somebody is actually looking out for the various issues they have — behavioral health issues, medication access issues, home care, whatever. The result is that, for their Intensive Care Management members, in 2017 the total cost of care dropped 12%.

    So, ER usage has gone down 25% and hospitalization dropped significantly. They actually have developed good programs to do the very thing which the MCOs always claimed they did but never actually did to actually coordinate care. If you do this, you keep people out of the ER and avoid readmissions, you save money. Again, tt’s not perfect, and we’ve got issues, but we think the system has worked to save money the right way, not by denying services but by providing better service.

    The last thing to point out is the handout “Medicaid’s Care Management program is saving lives and money, but savings may be going to PCMH+ ACOs.” ACOs, Accountable Care Organizations, are the latest thing that everybody who’s anybody in health policy is supposed to believe in as the answer to our problems with health care cost. ACOs put financial risk onto (generally larger) provider groups instead of insurance companies.

    The idea, mostly pushed in Medicare but now in Medicaid as well, is that you put provider groups at financial risk and they’ll somehow do the right thing, keep costs down but not in a bad way, not by harming access, denying services, denying referrals. Somehow, they’ll do it in the right way. To me, that’s frankly religion. It’s belief in a system that hasn’t been proven, that you can’t really prove and has been very controversial. Unfortunately, Connecticut has adopted a shared savings type of ACO program, called PCMH+, that is very different from patient-centered medical homes, PCMH without the “plus”. And the primary difference is the use of a shared savings payment model in PCMH+.

    If groups of providers respond positively to an RFP, they’re in a system where any of the money they save on the total cost of care of their own patients, using actuarial data and some risk adjustment, they get to keep half of. Advocates are very concerned. We have one year of data now, and it suggests that this is not saving money and may be harming access to care. We don’t know where that’s going at this point.

    The basic point about our system: under managed fee-for-service, the state maintains the risk, and is using both insurance companies on a non-risk basis to do certain administrative actions in a good way to meet the goals of improving care while keeping costs down, and PCMHs to coordinate care on a regular basis. There’s still an access problem with specialists because of low reimbursement rates.

    About 45% of the Medicaid population is within an accredited PCMH. It’s a little hard to know exactly what the PCMHs are doing in terms of care coordination, though we do have numbers that show they are doing better than non-PCMHs on most indicators.

    Costs have been relatively flat since we made the transition, suggesting that we are getting some decent care coordination for the elderly/disabled population as well for families with kids which had been in the capitated MCO system.

    At the time of the transition, there were three MCOs, Community Health Network of CT, Aetna, and UnitedHealth (CHNCT, the one non-profit, became the non-risk contracted ASO). For-profit entities have lobbied hard with successive governors to come back into the program on a risk basis, but we’ve managed to hold them off. It’s saving money, so that’s a strong argument for keeping what we have, and we’re also pointing out access and quality gains, as well as the high medical loss ratios. And, over time, the State Medicaid agency became very invested in the new program, which was producing good results.

    We tried to get consumers involved in designing and then advocating for the new program. However, it was very hard to get them engaged.

    It was important overall that advocates had a period in which the managed care organizations were revealed to have been doing bad things, violating the idea of transparency, resisting the Freedom of Information requests, essentially committing a form of fraud in terms of misrepresenting pharmacy coverage, etc. These were important in discrediting them as part of the story. Advocates never would have gotten what they got from the governor if they hadn’t done that. Although advocates could produce white papers saying to the candidates that they should do this or that, the reality is that the climate was what really mattered. They worked really hard at getting media to expose the shortcomings in the system, which changed that climate.

    Advocates didn’t have great data, because the MCOs kept their cards close to the vest. So it was really hard to produce actual numbers of denials or whatever. It was a challenge. Advocates basically said that state officials don’t want to hold huge state contractors accountable with our taxpayer money, so that is why we don’t have the necessary data, even as they had a lot of anecdotal stories of harm.

    In the absence of data, what do you do? You paint a picture based upon what you do have of an industry that is not capable of being reformed. And so advocates made the case that we should do an alternative, the non-risk form of managed care known as PCCM, saying essentially “Here’s another way to do it. It’s not radical. Other states are doing it. And it’s right in the federal Medicaid Act. It’s not a big deal.”

    You can’t win this battle on the basis of the money wasted on risk-based insurers alone. Advocates did a lot of outreach to providers, particularly in the behavioral health area, to develop individual stories of abuse. Advocates learned the techniques the MCOs were using to deny services, the games they played. So they produced a survey which said, “Have you seen this?” We had a one-page referral form and said, don’t give us the name of the client, but do you have a client who has experienced this and if so, please tell us what’s going on. The horror stories were just unbelievable. Advocates emphasized these kids’ cases, and got media attention which was very sympathetic.

    Having providers know we were looking was very important. When advocates met with some of them, they said, “We’ve been looking for a way out for years. We needed you,” or words to that effect, so the advocates’ names got around. And providers contacted them, and they worked together to tell their stories.