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Blog

Medicare drug negotiation guidance: what you need to know

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This week our In Focus section reviews the Centers for Medicare and Medicaid Services’ (CMS) announcement of initial guidance for the new Medicare Drug Price Negotiation Program for 2026. This initial guidance is one of many steps CMS described in the Medicare Drug Price Negotiation Program timeline for the first year of negotiation.

The Drug Price Negotiation Program was approved as part of the Inflation Reduction Act (IRA) (P.L. 117- 169) in August 2022. As discussed in our previous In Focus, the IRA includes several other policies aimed at addressing cost, affordability and access to prescription drugs within the Medicare program.

The Drug Negotiation Program allows the U.S. Department of Health and Human Services (HHS) to negotiate maximum fair prices (MFPs) for Part D drugs. Negotiations between HHS and prescription drug manufactures will begin in 2023 and continue into 2024 before negotiated prices go into effect Jan. 1, 2026.

For Medicare payment in 2026, HHS can negotiate prices for up to 10 Part D drugs that do not have generic or biosimilar competition. CMS can increase the number of Part D drugs selected for price negotiation each subsequent year. Starting in 2028, the agency can annually add up to 20 new Part B or Part D drugs to the program.

The published guidance describes CMS’ approach for identifying the drugs selected for the initial year of the program. However, CMS is finalizing these policies as announced for the initial drug negotiation year.

The initial guidance also details the requirements and procedures for implementing the process for the first set of negotiations. For example, the guidance details aspects related to the offer-counter-offer exchange process, confidentiality terms following an agreement, penalties for violations, and the dispute resolution process.

Key Considerations

The drug negotiation program presents numerous operational and policy questions for CMS, manufacturers, and the healthcare sector broadly. The program is expected to have a direct impact on prices and affordability for the Medicare program and its beneficiaries. Additionally, other public and commercial payers will want to consider the potential downstream impacts on their costs. Ongoing monitoring of HHS’ implantation of the drug negotiation program and the pharmaceutical industry’s response to the drug negotiation program will help health plans, providers, and other interested stakeholders navigate this new landscape.

What’s Next

In the short-run, CMS will benefit from feedback from stakeholders about the outstanding policy and operational issues the agency has identified. Comments can be submitted until April 14, 2023

CMS anticipates issuing revised guidance for the first year of negotiation in Summer 2023. By September 1, 2023, CMS plans to publish the first 10 Part D drugs selected for the initial program year. The negotiated maximum fair prices for these drugs will be published by September 1, 2024 and prices will be in effect starting January 1, 2026.

HMA and HMA companies will continue to analyze this and subsequent guidance. We have analytical capabilities and expertise to assist with tailored analysis for manufacturers, providers, patient groups, health plans, and other stakeholders. HMA has the ability to model policy impacts of the drug negotiation program, support the drafting of feedback to CMS as the program is designed and implemented, and provide technical assistance in considering how this new program may interact with other Medicare and Medicaid initiatives.

If you have questions about the Drug Negotiation Program or other aspects of the Inflation Reduction Act and how it will affect manufacturers, Medicare providers, Medicaid programs and patients, contact Kevin Kirby ([email protected]), Amy Bassano ([email protected]) or Andrea Maresca ([email protected]).

Blog

Medicaid authority and opportunity to build new programs for justice-involved individuals

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On January 26, the Centers for Medicare & Medicaid Services (CMS) approved California’s (CA) section 1115 request to cover targeted healthcare services for incarcerated individuals 90 days before release. This historical partial rollback of the Medicaid Inmate Exclusion Policy empowers the CA Department of Health Care Services (DHCS) to collaborate with state agencies, counties, health plans and community-based organizations to create coordinated community reentry services focused on persons transitioning from incarceration to community that provide physical and behavioral healthcare services.

Fourteen states have pending section 1115 demonstration requests to provide specific healthcare services for justice-involved individuals. CMS has indicated it will be issuing guidance on the coverage parameters for healthcare services for individuals transitioning from carceral settings.  These efforts allow states, counties, and cities to build coordinated systems of healthcare care to support reentry.  Building such systems requires infrastructure development and enhancement, stakeholder engagement, strategic planning, and project and change management across justice partners, health plans, and community-based organizations. 

Implementing the services will involve an in-depth understanding of the fundamental healthcare needs of justice-involved individuals, carceral setting healthcare delivery and reentry (transition to the community), and how to operationalize necessary changes to meet program requirements.  Additionally, change management, critical stakeholder coordination, infrastructure, and technology development, enhancement, guidance on data-sharing agreements, and health plan involvement will need to be created or adapted to meet the CMS 1115 requirements.  Administrators of carceral settings and correctional healthcare providers must coordinate services with community-based organizations and health plans to implement timely, cost-effective, and quality healthcare services to individuals leaving carceral facilities.

States, payors, correctional administrators, and healthcare providers will benefit from understanding the 1115 requirements to stand up this initiative, recommendations to facilitate the 1115 application process, how it intersects with healthcare delivery within a carceral setting and during reentry, and practical strategies for planning and operationalizing the effective delivery and coordination of healthcare services that meet program requirements. 

On Thursday, April 6, 2023, HMA held a webinar to help states and other stakeholders understand the section 1115 parameters and provide insight to states, local government, correctional health settings, and providers on how to best plan for implementing such services.

Key experts covered the following topics:

  • Deep Dive into California’s section 1115 approval and lessons learned from the California application process?
  • Operationalizing In Reach and Re-entry Programming for Justice-Involved Individuals
    • Understanding the complex needs of justice-involved individuals.
    • What investments must states make to implement Medicaid-eligible services for justice-involved individuals?
    • What role can technology and digital health play in supplementing direct care?
  • The Role of Payers in new Services for Justice-Involved Individuals

Speakers:

Linda Follenweider, Managing Director, Justice Involved Services
Tonya Moore, Senior Consultant
Margaret Tatar, Managing Principal
John Volpe, Principal
Julie White, Principal 

HMA consultants bring unparalleled expertise in Medicaid policy, correctional health and a deep understanding of the unique needs of this population. We have the operational knowledge and experience with technology and digital health solutions, as well as the needed data and analytic capacity to collect the correct data to drive improvements in equity and access to care.

Blog

Medicaid managed care enrollment update – Q4 2022

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This week, our In Focus section reviews recent Medicaid enrollment trends in capitated, risk-based managed care in 32 states.[1] Many state Medicaid agencies post monthly enrollment figures by health plan for their Medicaid managed care population to their websites. This data allows for the timeliest analysis of enrollment trends across states and managed care organizations. All 32 states highlighted in this review have released monthly Medicaid managed care enrollment data into the fourth quarter (Q4) of 2022. This report reflects the most recent data posted. HMA will continue tracking enrollment throughout the eligibility redetermination period. HMA has made the following observations related to the enrollment data shown on Table 1 (below):

  • The 32 states in this report account for an estimated 71 million Medicaid managed care enrollees as of December 2022. Based on HMA estimates of MCO enrollment in states not covered in this report, we believe that nationwide Medicaid MCO enrollment was likely about 75 million in December 2022. As such, the enrollment data across these 32 states represents approximately 95 percent of all Medicaid MCO enrollment.
  • Across the 32 states tracked in this report, Medicaid managed care enrollment is up 7.5 percent year-over-year as of December 2022.
  • All states, besides Mississippi, saw increases in enrollment in December 2022, compared to the previous year, due to the gains from the COVID-19 pandemic. Mississippi Medicaid managed care enrollment fell because the state shifted members to FFS during the public health emergency.
  • Twenty-three of the 32 states – Arizona, California, District of Columbia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, Pennsylvania, Virginia, Washington, and West Virginia – expanded Medicaid under the Affordable Care Act and have seen increased Medicaid managed care enrollment since expansion.
  • The 23 expansion states listed above have seen net Medicaid managed care enrollment increase by 3.5 million members, or 7.2 percent, in the past year, to 52.2 million members at the end of 2022.
  • The nine states that have not yet expanded Medicaid as of December 2022 – Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, Tennessee, Texas, and Wisconsin – have seen Medicaid managed care enrollment increase 8.3 percent to 19 million members at the end of 2022.

Table 1 – Monthly MCO Enrollment by State – July 2022 through December 2022

 Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Arizona2,069,0482,079,3602,095,1012,106,8002,116,4442,127,666
+/- m/m8,52710,31215,74111,6999,64411,222
% y/y7.6%0.0%7.5%7.4%7.2%7.1%
California12,929,50013,013,32413,073,42713,132,61613,231,99313,204,398
+/- m/m215,50683,82460,10359,18999,377(27,595)
% y/y9.8%9.9%9.9%9.9%10.2%9.5%
D.C.246,957247,704248,577249,617250,676 
+/- m/m3,2237478731,0401,059N/A
% y/y6.7%6.7%6.5%6.5%6.4%
Florida4,385,9654,432,2334,465,6704,502,2974,537,1214,581,266
+/- m/m41,44146,26833,43736,62734,82444,145
% y/y10.9%10.9%10.7%10.7%10.7%11.0%
Georgia1,975,2771,988,727 2,016,4622,027,2752,035,673
+/- m/m13,11713,450N/AN/A10,8138,398
% y/y9.8%9.5%9.0%8.7%8.3%
Illinois2,890,3322,884,0292,900,2322,929,5842,965,0073,000,717
+/- m/m(8,672)(6,303)16,20329,35235,42335,710
% y/y5.1%4.5%4.1%4.4%5.1%5.5%
Indiana1,742,7621,761,6921,769,4001,781,4641,797,4511,813,044
+/- m/m6,90618,9307,70812,06415,98715,593
% y/y11.6%11.3%11.0%10.5%10.2%10.3%
Iowa795,534799,748807,296 812,481814,490
+/- m/m2,6424,2147,548N/AN/A2,009
% y/y5.9%5.8%6.4%6.0%6.1%
Kansas489,309490,911492,640497,257499,143500,814
+/- m/m2,6911,6021,7294,6171,8861,671
% y/yN/AN/AN/AN/A8.3%6.3%
Kentucky1,494,0681,487,3871,509,2741,518,9061,528,4841,534,657
+/- m/m6,069(6,681)21,8879,6329,5786,173
% y/y5.5%5.3%5.6%5.8%6.7%6.1%
Louisiana1,821,6441,828,0151,833,4571,841,6931,858,0921,860,170
+/- m/m7,2136,3715,4428,23616,3992,078
% y/y4.6%4.5%4.4%4.7%5.2%5.8%
Maryland1,496,6771,502,2711,508,4691,514,3811,521,1711,529,308
+/- m/m8,2055,5946,1985,9126,7908,137
% y/y6.5%6.2%6.1%5.8%5.8%5.7%
Michigan2,280,2432,294,4322,299,9132,309,9132,319,9512,324,046
+/- m/m2,92314,1895,48110,00010,0384,095
% y/y3.8%3.6%3.5%3.7%4.5%4.3%
Minnesota1,261,1121,262,0731,278,9541,286,8901,293,8581,299,194
+/- m/m1,89396116,8817,9366,9685,336
% y/y7.3%6.7%7.4%7.5%7.5%7.5%
Mississippi367,137363,387364,612355,694367,902396,880
+/- m/m(452)(3,750)1,225(8,918)12,20828,978
% y/y-22.7%-19.9%-17.4%-17.3%-12.5%-3.9%
Missouri1,038,2391,065,2171,099,7071,118,3731,136,5891,157,005
+/- m/m26,52026,97834,49018,66618,21620,416
% y/y27.0%29.1%32.6%31.7%31.8%29.0%
Nebraska363,328366,202369,770372,613374,857378,237
+/- m/m2,7402,8743,5682,8432,2443,380
% y/y12.4%11.9%11.7%11.2%10.8%10.6%
Nevada687,362689,139697,752675,465685,736692,890
+/- m/m9,4641,7778,613(22,287)10,2717,154
% y/y9.3%9.0%9.3%4.2%5.2%5.7%
New Jersey2,100,9472,113,9302,125,1812,130,8682,144,5142,158,966
+/- m/m10,89712,98311,2515,68713,64614,452
% y/y7.4%7.4%7.2%7.0%7.1%7.0%
New Mexico809,991811,732812,995813,630814,466815,798
+/- m/m2,4911,7411,2636358361,332
% y/y4.2%3.7%3.4%3.0%2.6%2.3%
New York5,855,6155,853,1085,878,5195,906,2645,929,2885,961,782
+/- m/m39,970(2,507)25,41127,74523,02432,494
% y/y4.5%4.3%4.2%4.3%4.5%4.6%
North Carolina1,738,5451,746,9481,757,5031,768,9741,778,1991,837,423
+/- m/m9,0478,40310,55511,4719,22559,224
% y/y8.0%6.8%6.7%6.6%6.6%9.5%
Ohio2,964,7312,963,6162,960,9222,958,6662,961,9832,973,763
+/- m/m(1,340)(1,115)(2,694)(2,256)3,31711,780
% y/y3.4%2.6%1.9%1.4%1.0%0.9%
Oregon1,193,3581,202,1981,206,5201,211,0991,221,4351,228,054
+/- m/m3,9208,8404,3224,57910,3366,619
% y/y8.3%8.4%7.7%7.6%7.4%7.2%
Pennsylvania2,895,8372,909,9852,920,5842,937,0492,950,6132,966,207
+/- m/m13,97314,14810,59916,46513,56415,594
% y/y7.4%7.3%6.9%6.8%6.6%6.5%
South Carolina1,055,7851,063,4451,069,5691,078,0941,084,5291,089,577
+/- m/m5,2267,6606,1248,5256,4355,048
% y/y7.6%7.5%7.4%7.9%7.6%7.5%
Tennessee1,692,3951,704,3981,710,1251,718,5391,726,6031,734,108
+/- m/m6,73712,0035,7278,4148,0647,505
% y/y6.0%6.1%6.1%6.0%5.9%5.8%
Texas 5,466,045  5,653,169 
+/- m/mN/AN/AN/AN/AN/AN/A
% y/y8.6%10.6%
Virginia1,572,9231,582,9731,589,7221,598,8751,608,8401,619,311
+/- m/m11,82910,0506,7499,1539,96510,471
% y/y11.3%11.0%10.0%9.6%10.1%9.8%
Washington1,884,7341,898,9831,904,1271,913,2301,927,6901,959,278
+/- m/m8,86714,2495,1449,10314,46031,588
% y/y#DIV/0!#DIV/0!5.8%5.9%6.0%7.2%
West Virginia519,992524,042524,922527,226530,494533,194
+/- m/m2,8714,0508802,3043,2682,700
% y/y6.5%6.8%6.4%5.9%5.9%5.7%
Wisconsin1,161,2021,166,2081,172,7191,179,2041,184,8991,190,673
+/- m/m5,2635,0066,5116,4855,6955,774
% y/y7.5%7.2%7.1%7.1%6.9%6.6%

Note: In Table 1 above and the state tables below, “+/- m/m” refers to the enrollment change from the previous month. “% y/y” refers to the percentage change in enrollment from the same month in the previous year.

Below, we provide a state-specific analysis of recent enrollment trends in the states where HMA tracks data.

It is important to note the limitations of the data presented. First, not all states report the data at the same time during the month. Some of these figures reflect beginning-of-the-month totals, while others reflect an end-of-the-month snapshot. Second, in some cases the data is comprehensive in that it covers all state-sponsored health programs for which the state offers managed care; in other cases, the data reflects only a subset of the broader Medicaid managed care population. This is the key limiting factor in comparing the data described below and figures reported by publicly traded Medicaid MCOs. Consequently, the data we review in Table 1 and throughout the In Focus section should be viewed as a sampling of enrollment trends across these states rather than a comprehensive comparison, which cannot be developed based on publicly available monthly enrollment data.

State-Specific Analysis

Arizona

Medicaid Expansion Status: Expanded January 1, 2014

Enrollment in Arizona’s two Medicaid managed care programs grew to 2.1 million in December 2022, up 7.1 percent from December 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Acute Care2,002,5842,012,8022,028,3352,039,8802,049,3112,060,376
ALTCS66,46466,55866,76666,92067,13367,290
Total Arizona2,069,0482,079,3602,095,1012,106,8002,116,4442,127,666
+/- m/m8,52710,31215,74111,6999,64411,222
% y/y7.6%7.5%7.4%7.2%7.1%

California

Medicaid Expansion Status: Expanded January 1, 2014

Medi-Cal managed care enrollment was up 9.5 percent year-over-year to 13.2 million, as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Two-Plan Counties8,356,1378,409,8178,446,5148,481,8858,548,0968,588,418
Imperial/San Benito100,384101,117101,633102,064102,881103,437
Regional Model364,066366,437368,624370,361373,402375,473
GMC Counties1,435,2501,445,5321,452,1271,458,1491,470,1221,391,421
COHS Counties2,561,8312,578,7472,593,0032,608,7312,625,7952,634,112
Duals Demonstration111,832111,674111,526111,426111,697111,537
Total California12,929,50013,013,32413,073,42713,132,61613,231,99313,204,398
+/- m/m215,50683,82460,10359,18999,377(27,595)
% y/y9.8%9.9%9.9%9.9%10.2%9.5%

District of Columbia

Medicaid Expansion Status: Expanded January 1, 2014

Medicaid managed care enrollment in the District of Columbia was up 6.4 percent to almost 251,000 in November 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22
Total District of Columbia246,957247,704248,577249,617250,676
+/- m/m3,2237478731,0401,059
% y/y6.7%6.7%6.5%6.5%6.4%

Florida

Medicaid Expansion Status: Not Expanded

Florida’s statewide Medicaid managed care program had seen an 11 percent rise in total covered lives over the last year to nearly 4.6 million beneficiaries as of December 2022. (Note that the managed LTC enrollment figures listed below are a subset of the Managed Medical Assistance (MMA) enrollments and are included in the MMA number; they are not separately added to the total to avoid double counting).

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
MMA3,908,5393,948,9293,978,0984,010,5344,041,8164,080,381
LTC (Subset of MMA)124,107124,691125,397126,144126,720126,621
SMMC Specialty Plan332,179338,057342,325346,516350,058355,638
FL Healthy Kids145,247145,247145,247145,247145,247145,247
Total Florida4,385,9654,432,2334,465,6704,502,2974,537,1214,581,266
+/- m/m41,44146,26833,43736,62734,82444,145
% y/y10.9%10.9%10.7%10.7%10.7%11.0%

Georgia

Medicaid Expansion Status: Not Expanded

As of December 2022, Georgia’s Medicaid managed care program covered more than 2 million members, up 8.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Georgia1,975,2771,988,7272,016,4622,027,2752,035,673
+/- m/m13,11713,45010,8138,398
% y/y9.8%9.5%9.0%8.7%8.3%

Illinois

Medicaid Expansion Status: Expanded January 1, 2014

Illinois enrollment across the state’s managed care programs was up 5.5 percent to 3 million as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
HealthChoice2,800,4202,793,1242,809,6892,839,3422,874,7002,909,303
Duals Demonstration89,91290,90590,54390,24290,30791,414
Total Illinois2,890,3322,884,0292,900,2322,929,5842,965,0073,000,717
+/- m/m(8,672)(6,303)16,20329,35235,42335,710
% y/y5.1%4.5%4.1%4.4%5.1%5.5%

Indiana

Medicaid Expansion Status: Expanded in 2015 through HIP 2.0

As of December 2022, enrollment in Indiana’s managed care programs—Hoosier Healthwise, Hoosier Care Connect, and Healthy Indiana Program (HIP)—was more than 1.8 million, up 10.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Hoosier Healthwise845,910852,904857,952863,973869,613876,606
Hoosier Care Connect102,805102,819102,537102,253102,200102,150
HIP794,047805,969808,911815,238825,638834,288
Indiana Total1,742,7621,761,6921,769,4001,781,4641,797,4511,813,044
+/- m/m6,90618,9307,70812,06415,98715,593
% y/y11.6%11.3%11.0%10.5%10.2%10.3%

Iowa

Medicaid Expansion Status: Expanded January 1, 2014

Iowa launched its statewide Medicaid managed care program in April of 2016. Enrollment across all populations was nearly 814,500, as of December 2022. Enrollment was up 6.1 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Traditional Medicaid507,266510,618516,556520,234521,118
Iowa Wellness Plan237,910239,261242,555244,724246,385
hawk-i50,35849,86948,18547,52346,987
Total Iowa795,534799,748807,296812,481814,490
+/- m/m2,6424,2147,5482,009
% y/y5.9%5.8%6.4%6.0%6.1%

Kansas

Medicaid Expansion Status: Not Expanded

Kansas Medicaid managed care enrollment was nearly 501,000 as of December 2022, up 6.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Kansas489,309490,911492,640497,257499,143500,814
+/- m/m2,6911,6021,7294,6171,8861,671
% y/y8.3%6.3%

Kentucky

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, Kentucky covered more than 1.5 million beneficiaries in risk-based managed care. Total enrollment was up 6.1 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Kentucky1,494,0681,487,3871,509,2741,518,9061,528,4841,534,657
+/- m/m6,069(6,681)21,8879,6329,5786,173
% y/y5.5%5.3%5.6%5.8%6.7%6.1%

Louisiana

Medicaid Expansion Status: Expanded July 1, 2016

Medicaid managed care enrollment in Louisiana was more than 1.86 million as of December 2022, up 5.8 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Louisiana1,821,6441,828,0151,833,4571,841,6931,858,0921,860,170
+/- m/m7,2136,3715,4428,23616,3992,078
% y/y4.6%4.5%4.4%4.7%5.2%5.8%

Maryland

Medicaid Expansion Status: Expanded January 1, 2014

Maryland’s Medicaid managed care program covered more than 1.5 million lives as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Maryland1,496,6771,502,2711,508,4691,514,3811,521,1711,529,308
+/- m/m8,2055,5946,1985,9126,7908,137
% y/y6.5%6.2%6.1%5.8%5.8%5.7%

Michigan

Medicaid Expansion Status: Expanded April 1, 2014

As of December 2022, Michigan’s Medicaid managed care was up 4.3 percent to 2.3 million.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Medicaid2,239,9372,251,8102,256,8002,265,2192,274,7632,279,473
MI Health Link (Duals)40,30642,62243,11344,69445,18844,573
Total Michigan2,280,2432,294,4322,299,9132,309,9132,319,9512,324,046
+/- m/m2,92314,1895,48110,00010,0384,095
% y/y3.8%3.6%3.5%3.7%4.5%4.3%

Minnesota

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment across Minnesota’s multiple managed Medicaid programs was nearly 1.3 million, up 7.5 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Parents/Kids748,197748,513758,100763,044767,798770,918
Expansion Adults272,666273,387278,421281,284284,073288,680
Senior Care Plus24,19024,25225,34425,91426,41526,740
Senior Health Options43,42943,68643,92044,16244,24844,324
Special Needs BasicCare64,65664,48465,56265,76365,98766,171
Moving Home Minnesota11111010911
Minnesota Care107,963107,740107,597106,713105,328102,350
Total Minnesota1,261,1121,262,0731,278,9541,286,8901,293,8581,299,194
+/- m/m1,89396116,8817,9366,9685,336
% y/y7.3%6.7%7.4%7.5%7.5%7.5%

Mississippi

Medicaid Expansion Status: Not Expanded

MississippiCAN, the state’s Medicaid managed care program, had membership down 3.9 percent to nearly 397,000 as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Mississippi367,137363,387364,612355,694367,902396,880
+/- m/m(452)(3,750)1,225(8,918)12,20828,978
% y/y-22.7%-19.9%-17.4%-17.3%-12.5%-3.9%

Missouri

Medicaid Expansion Status: Expansion Enrollment began in October 2021

Missouri managed care enrollment in the Medicaid and CHIP programs was nearly 1.2 million in December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Medicaid758,928757,312769,419775,076782,863787,611
Total CHIP28,94928,93729,02629,12129,23129,402
Total AEG199,963228,361250,131262,612272,574287,692
Total SHK50,39950,60751,13151,56451,92152,300
Total Missouri1,038,2391,065,2171,099,7071,118,3731,136,5891,157,005
+/- m/m26,52026,97834,49018,66618,21620,416
% y/y27.0%29.1%32.6%31.7%31.8%29.0%

Nebraska

Medicaid Expansion Status: Expanded October 1, 2020

As of December 2022, Nebraska’s Medicaid managed care program enrolled 378,000 members, up 10.6 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Nebraska363,328366,202369,770372,613374,857378,237
+/- m/m2,7402,8743,5682,8432,2443,380
% y/y12.4%11.9%11.7%11.2%10.8%10.6%

Nevada

Medicaid Expansion Status: Expanded January 1, 2014

Nevada’s Medicaid managed care enrollment was up 5.7 percent to nearly 693,000 as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Nevada687,362689,139697,752675,465685,736692,890
+/- m/m9,4641,7778,613(22,287)10,2717,154
% y/y9.3%9.0%9.3%4.2%5.2%5.7%

New Jersey

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, New Jersey Medicaid managed care enrollment was up 7 percent to nearly 2.2 million.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total New Jersey2,100,9472,113,9302,125,1812,130,8682,144,5142,158,966
+/- m/m10,89712,98311,2515,68713,64614,452
% y/y7.4%7.4%7.2%7.0%7.1%7.0%

New Mexico

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, New Mexico’s Centennial Care program covered nearly 816,000 members, up 2.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total New Mexico809,991811,732812,995813,630814,466815,798
+/- m/m2,4911,7411,2636358361,332
% y/y4.2%3.7%3.4%3.0%2.6%2.3%

New York

Medicaid Expansion Status: Expanded January 1, 2014

New York’s Medicaid managed care programs collectively covered nearly 6 million beneficiaries as of December 2022, a 4.6 percent increase from the previous year. The Medicaid Advantage program ended in December 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Mainstream MCOs5,399,0895,395,4895,418,9155,446,4095,467,4675,494,358
Managed LTC255,999256,538258,236257,360260,087264,965
Medicaid Advantage000000
Medicaid Advantage Plus34,35734,35534,68934,76434,71735,061
HARP164,514165,067165,024166,063165,340165,713
FIDA-IDD (Duals)1,6561,6591,6551,6681,6771,685
Total New York5,855,6155,853,1085,878,5195,906,2645,929,2885,961,782
+/- m/m39,970(2,507)25,41127,74523,02432,494
% y/y4.5%4.3%4.2%4.3%4.5%4.6%

North Carolina

Medicaid Expansion Status: Not Expanded

As of December 2022, enrollment in North Carolina’s Medicaid managed care program was 1.8 million, up 9.5 percent from the prior year. North Carolina implemented Medicaid managed care on July 1, 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total North Carolina1,738,5451,746,9481,757,5031,768,9741,778,1991,837,423
+/- m/m9,0478,40310,55511,4719,22559,224
% y/y8.0%6.8%6.7%6.6%6.6%9.5%

Ohio

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment across all four Ohio Medicaid managed care programs was nearly 3 million, up 0.9 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
CFC Program1,800,7811,800,0381,798,1351,796,3271,798,8731,804,860
ABD/Duals348,071348,176347,461347,371347,473347,839
Group 8 (Expansion)815,879815,402815,326814,968815,637821,064
Total Ohio2,964,7312,963,6162,960,9222,958,6662,961,9832,973,763
+/- m/m(1,340)(1,115)(2,694)(2,256)3,31711,780
% y/y3.4%2.6%1.9%1.4%1.0%0.9%

Oregon

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment in the Oregon Coordinated Care Organization (CCO) Medicaid managed care program was more than 1.2 million, up 7.2 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Oregon1,193,3581,202,1981,206,5201,211,0991,221,4351,228,054
+/- m/m3,9208,8404,3224,57910,3366,619
% y/y8.3%8.4%7.7%7.6%7.4%7.2%

Pennsylvania

Medicaid Expansion Status: Expanded January 1, 2015

As of December 2022, Pennsylvania’s Medicaid managed care enrollment was nearly 3 million, up 6.5 percent in the past year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Pennsylvania2,895,8372,909,9852,920,5842,937,0492,950,6132,966,207
+/- m/m13,97314,14810,59916,46513,56415,594
% y/y7.4%7.3%6.9%6.8%6.6%6.5%

South Carolina

Medicaid Expansion Status: Not Expanded

South Carolina’s Medicaid managed care programs collectively enrolled nearly 1.1 million members as of December 2022, which represents an increase of 7.5 percent in the past year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Medicaid1,041,9091,049,7061,056,0261,064,5481,071,0161,076,146
Total Duals Demo13,87613,73913,54313,54613,51313,431
Total South Carolina1,055,7851,063,4451,069,5691,078,0941,084,5291,089,577
+/- m/m5,2267,6606,1248,5256,4355,048
% y/y7.6%7.5%7.4%7.9%7.6%7.5%

Tennessee

Medicaid Expansion Status: Not Expanded

As of December 2022, TennCare managed care enrollment totaled 1.7 million, up 5.8 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Tennessee1,692,3951,704,3981,710,1251,718,5391,726,6031,734,108
+/- m/m6,73712,0035,7278,4148,0647,505
% y/y6.0%6.1%6.1%6.0%5.9%5.8%

Texas

Medicaid Expansion Status: Not Expanded

Texas’ state fiscal year begins in September and program-specific enrollment is only reported at the end of each state fiscal quarter. As of November 2022, Texas Medicaid managed care enrollment was nearly 5.7 million across the state’s six managed care programs, up 10.6 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
STAR4,559,2934,748,820
STAR+PLUS559,746568,456
STAR HEALTH45,76046,228
Duals Demo34,33633,673
CHIP97,15385,773
STAR KIDS169,757170,219
Total Texas5,466,0455,653,169
+/- m/m
% y/y8.6%10.6%

Virginia

Medicaid Expansion Status: January 1, 2019

Virginia Medicaid managed care enrollment was up 9.8 percent in December 2022 to 1.6 million members.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Virginia1,572,9231,582,9731,589,7221,598,8751,608,8401,619,311
+/- m/m11,82910,0506,7499,1539,96510,471
% y/y11.3%11.0%10.0%9.6%10.1%9.8%

Washington

Medicaid Expansion Status: Expanded January 1, 2014

Washington’s Medicaid managed care enrollment increased 7.2 percent to nearly 2 million as of December 2022, compared to the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Washington1,884,7341,898,9831,904,1271,913,2301,927,6901,959,278
+/- m/m8,86714,2495,1449,10314,46031,588
% y/y#DIV/0!#DIV/0!5.8%5.9%6.0%7.2%

West Virginia

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, West Virginia’s Medicaid managed care program covered 533,000 members, up 5.7 percent year-over-year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total West Virginia519,992524,042524,922527,226530,494533,194
+/- m/m2,8714,0508802,3043,2682,700
% y/y6.5%6.8%6.4%5.9%5.9%5.7%

Wisconsin

Medicaid Expansion Status: Not Expanded

Across Wisconsin’s three Medicaid managed care programs, December 2022 enrollment totaled nearly 1.2 million, up 6.6 percent from the year before.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
BadgerCare+1,042,4561,047,2171,053,3611,059,5871,065,1821,070,788
SSI61,84161,91662,06562,12962,16562,293
LTC56,90557,07557,29357,48857,55257,592
Total Wisconsin1,161,2021,166,2081,172,7191,179,2041,184,8991,190,673
+/- m/m5,2635,0066,5116,4855,6955,774
% y/y7.5%7.2%7.1%7.1%6.9%6.6%

More Information Available from HMA Information Services

More detailed information on the Medicaid managed care landscape is available from HMA Information Services (HMAIS), which collects Medicaid enrollment data, health plan financials, and the latest on expansions, waivers, duals, ABD populations, long-term care, accountable care organizations, and patient-centered medical homes. HMAIS also includes a public documents library with copies of Medicaid RFPs, responses, model contracts, and scoring sheets.

HMAIS enhances this publicly available information with an overview of the structure of Medicaid in each state, as well as proprietary Medicaid Managed Care RFP calendars.

For additional information on how to subscribe to HMA Information Services, contact Carl Mercurio at 212-575-5929 or [email protected].

[1] Arizona, California, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington, West Virginia, Wisconsin.

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Financial impact summary of the 2024 Medicare Advantage Advance Notice

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This week, our In Focus section highlights a Wakely, an HMA Company, summary and analysis of the 2024 Medicare Advantage Advance Notice, prepared for America’s Health Insurance Plans (AHIP). The Centers for Medicare & Medicaid Services (CMS) released the contract year (CY) 2024 Advance Notice with an accompanying fact sheet on February 1, 2023. AHIP has retained Wakely Consulting Group to provide a financial impact summary report of the information presented in the notice. Specifically, Wakely was asked to analyze changes to Medicare Advantage (MA) revenue, risk adjustment models, and fee-for-service (FFS) normalization.

Key highlights of the analysis are:

  • The CY 2024 FFS growth rate is lower than projections from the 2023 Final Announcement. A portion of the downward restatement is driven by a technical change. CMS has not commented on the additional drivers.
  • Based on a large sample of plans, Wakely estimated that the proposed Part C risk adjustment model is expected to decrease plan risk adjusted payment by 3.7 percent overall, which represents a bigger headwind than the CMS estimated decrease of 3.12 percent. The impacts vary significantly by model segment and geographic region, and for individual plans.
  • The proposed FFS normalization factor excludes PY 2021 risk scores in the calculation of the underlying trend. The exclusion of PY 2021 increases the FFS normalization factor which decreases PY 2024 risk scores.

The report, released March 6, 2023, provides additional detail and discussion of these issues. For questions, please contact Tim Courtney or Rachel Stewart.

Click here to read the report.

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Evaluating the delivery of virtual child welfare services

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This week, our In Focus reviews a new Health Management Associates (HMA) report, highlighting hybrid (in-person & virtual visits) as the future of child welfare service delivery. During the COVID-19 public health emergency (PHE), the federal government waived the requirement for “once every 30 days” in-person visits by caseworkers for children in foster care, allowing these visits to occur virtually. In 2021, Casey Family Programs (CFP) commissioned HMA to evaluate the delivery of virtual child welfare services and outline the implications of the COVID-19 PHE on the child welfare system.

The report “Evaluating the Delivery of Virtual Child Welfare Services” is now available. It summarizes HMA’s findings and elevates the voices of staff in public and private child welfare agencies, and of youth and families with lived experiences, and examines their perspectives on how well virtual services have worked. It also details the implications of the COVID-19 PHE, the response from public child welfare agencies, and offers guidance on a hybrid (part in-person, part virtual) service model, which we believe will continue to be a factor in the future delivery of child welfare services.

As the COVID-19 PHE accelerated the spread and scale of telehealth adoption in health care, we surmised that the experience offered valuable opportunities to learn more about how the health care sector’s adoption of telehealth services could be applied in the child welfare community. While cognizant of the unique considerations for child welfare, this disruption also represents a substantial opportunity to rethink the child welfare system and advance both the use of technology as well as a more prevention- and strengths-based approach to child welfare.

The report highlights innovative approaches in the field, offers questions to frame a jurisdiction’s decision-making process, and provides a tool to facilitate an informed decision on the hybrid model. The report also offers a broader value proposition that outlines policy, practice, workforce, and technology imperatives to develop a hybrid approach to the delivery of child welfare services.

For questions, please contact Uma AhluwaliaRob Muschler, or Sarah Oachs.

Link to Report

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CMS announces plans to pursue new Medicare and Medicaid drug payment models

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This week our In Focus section reviews the Centers for Medicare and Medicaid Services’ (CMS) announcement that the agency will explore three new prescription drug payment models in the Medicare and Medicaid programs:

  • Medicare High-Value Drug List Model
  • Cell and Gene Therapy (CGT) Access Model
  • Accelerating Clinical Evidence Model

The announcement – and accompanying report – responds to President Biden’s October 2022 Executive Order directing CMS’ Center for Medicare and Medicaid Innovation (the Innovation Center) to identify models that could lower cost sharing for commonly used drugs and include value-based payment for drugs.

Notably, the Innovation Center offered varying levels of specificity about the models, leaving unanswered many questions about the structures and timelines for the potential models. The Innovation Center will need to conduct more robust analysis to determine the design specifications for each model, stakeholder interest, and practical and political feasibility for each. In addition, each model will need to have its own application or rulemaking process to identify participants and other key model parameters. While this makes it difficult for the Innovation Center to specify timelines, it provides stakeholders some flexibility to analyze and develop recommendations for the potential models over the next several months.

HMA’s experts are also closely tracking CMS’ work on additional areas identified for the agency to research. For example, CMS could consider other regulatory pathways, partnerships, or campaigns to promote the following changes:

  • Opportunities to encourage price transparency for prescription drugs
  • Options to improve biosimilar adoption
  • Medicare fee-for-service options to support CGT access and affordability

The drug payment models build on other federal and state-level efforts to address prescription drug costs and total cost of care initiatives. For example, CMS’ drug payment model announcement comes just a week after the agency released its implementation approach for the drug payment policies approved as part of the inflation Reduction Act of 2022 (IRA) (P.L. 117-169). CMS is balancing the extensive implementation needs for the IRA while also acknowledging the new law may not directly address other value-based considerations impacting cost and access for certain prescription medications.

Below are some of the highlights of the Innovation Center’s drug payment models.

Medicare High Value Drug List Model

The Medicare High Value Drug List model would provide standardized approach to cost sharing for specified Part D medications. CMS suggests a standardized list with consistent cost-sharing to allow providers to easily identify and prescribe appropriate medications. Part D Sponsors could offer a Medicare-defined standard set of approximately 150 high-value generic drugs with a maximum co-payment of $2 for a month’s supply. Under this model, generic drugs included in the standardized list would not be subject to step therapy, prior authorization, quantity limits, or pharmacy network restrictions.

According to the report, CMS could explore leveraging existing systems, which would allow for a streamlined implementation. CMS also plans to seek input from beneficiaries, Part D Sponsors, manufacturers, and providers, but the agency did not provide a more specific timeline for announcing the Model specifications and start date.

Cell and Gene Therapy (CGT) Access

The Cell and Gene Therapy (CGT) Access model would be a voluntary opportunity for states and manufacturers. The model builds on existing state Medicaid initiatives to develop outcomes-based agreements (OBAs) with certain manufacturers of high-cost and breakthrough medications. CMS suggests the multistate test could inform a more permanent framework for evaluating, financing, and delivering CGTs on a broader scale. This model may also help address complexities with the federal drug rebate requirements in states that wish to pursue value-based contracting arrangements. Under this model a state Medicaid agency could choose to adopt the CMS structure for multi-state OBAs with participating manufacturers. CMS would be responsible for implementing, monitoring, reconciling, and evaluating financial and clinical outcomes. Initially the model would focus on CGTs for illnesses like sickle cell disease and cancer.  This approach could remove some of the barriers that have slowed state uptake of OBAs.

CMS plans to begin model development in 2023, announce the model sometime in 2024-25, and test it as early as 2026.

Accelerating Clinical Evidence Model

The Innovation Center is considering mandatory participation for Medicare Part B providers in the Accelerating Clinical Evidence Model. Under this potential model, the agency would adjust Medicare Part B payment amounts for Accelerated Approval Program (AAP) drugs to determine if adjustments incentivize manufacturers to timely complete trials, which in turn may facilitate earlier availability of clinical evidence.

The Innovation Center identified some challenging aspects for this model and stated the agency will need to consult with the U.S. Food and Drug Administration (FDA) in 2023 to consider approaches for this model. Statements from agency officials about the model also indicate the need for consultation with the Medicare Payment Advisory Commission (MedPAC) and other stakeholders, including through an Advance Notice of Proposed Rulemaking.

If the Innovation Center determines this model is feasible, the agency will provide more details about a targeted launch. The Innovation Center has previously attempted to implement mandatory Part B drug payment models but never implemented them due to legal challenges and stakeholder opposition.

HMA and HMA companies will continue to analyze these potential models and initiatives developing in parallel with the Innovation Center’s work. We have the depth and breadth of expertise to assist with tailored analysis, to model policy impacts of the potential models, and to support the drafting of feedback to CMS as it considers these options.

If you have questions about the Innovation Center’s proposed models and how it will affect manufacturers, Medicare providers, Medicaid programs and patients, contact Amy Bassano ([email protected]), Kevin Kirby ([email protected]) or Andrea Maresca ([email protected]).

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Mental health and addiction crises top the federal policy agenda in 2023

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This week our In Focus section reviews President Joseph R. Biden’s 2023 State of the Union Address (SOTU) to Congress. The President highlighted specific actions that Congress, and the Administration have taken over the last two years to advance his health care priorities.

During his first SOTU address in 2022, President Biden announced the creation of a “Unity Agenda”, which included priority policy areas with potential for bi-partisan support. The President highlighted several steps the Administration has taken to advance the “Unity Agenda” including:

  • The bipartisan effort to enact the Mainstreaming Addiction Treatment (MAT) Act, which removed the federal requirement for practitioners to have a waiver (known as the X-waiver) to prescribe medications, like buprenorphine, for the treatment of opioid use disorder
  • The Cancer Moonshot announcements for almost 30 new programs, policies, and resources to close the screening gap, tackle environmental exposure, decrease preventable cancers, advance cutting-edge research, support patients and caregivers, and more.
  • Addressing mental health needs through the expansion of Certified Community Behavioral Health Clinics and launch of the 988-suicide prevention hotline.

In his SOTU and accompanying White House materials, the President also proposed new policies and initiatives to further advance his health care agenda. These actions include a combination of issues that would require Congressional approval as well as actions regulatory agencies can already advance. Congress and the Administration are expected to build on previous bipartisan achievements to tackle the nation’s dual crises with addiction and mental health.

Notably, the policies outlined in the SOTU foreshadow an active regulatory agenda over the next 18 months as the Administration seeks to solidify key aspects of the President’s health care agenda ahead of the next Presidential election.

The Administration’s planned actions include the following:

Opioids

  • Calling on Congress to pass legislation to permanently schedule all illicitly produced fentanyl-related substances into Schedule I.
  • SAMHSA will provide enhanced technical assistance to states who have existing State Opioid Response funds, and will host peer learning forums, national policy academies, and convenings with organizations distributing naloxone beginning this spring.
  • By this summer, the Federal Bureau of Prisons will ensure that each of their 122 facilities are equipped and trained to provide in-house medication-assisted treatment (MAT).
  • This spring CMS will provide guidance to states on the use of federal Medicaid funding to provide health care services—including treatment for people with substance use disorder—to individuals in state and local jails and prisons prior to their release. California is the first state to receive approval for a similar initiative.

Mental Health

  • CDC plans to launch a new campaign to provide a hub of mental health and resiliency resources to health care organizations in better supporting their workforce.
  • The Department of Education (ED) will announce more than $280 million in grants to increase the number of mental health care professionals in high-need districts and strengthen the school-based mental health profession pipeline.
  • HHS and ED will issue guidance and propose a rule to make it easier for schools to provide health care to students and more easily bill Medicaid for these services.
  • The Administration is scheduled to propose new mental health parity rules this spring.
  • HHS will improve the capacity of the 988 Lifeline by investing in an expansion of the crisis care workforce; scaling mobile crisis intervention services; and developing additional guidance on best practices in crisis response.
  • HHS also plans to promote interstate license reciprocity for delivery of mental health services across state lines.
  • HHS intends to increase funding to recruit future mental health professionals from Historically Black Colleges and Universities and to expand the Minority Fellowship Program.
  • The Department of Veterans Affairs (VA), working with HHS and Defense, will launch a program for states, territories, Tribes and Tribal organizations to develop and implement proposals to reduce suicides in the military and among veterans.
  • VA will also increase the number of peer specialists working across VA medical centers to meet mental health needs

Cancer Moonshot

  • The President called on Congress to reauthorize the National Cancer Act to overhaul cancer research and to extend the funding for biomedical research established in the 21st Century Cures Act.
  • The Administration will take steps to ensure that patient navigation services are covered by insurance. This could require legislation depending on which type on insurance an individual has.

Health care costs

  • Urging Congress to pass legislation to cap insulin prices in all health care markets. Expanding the $35 insulin cap to commercial markets will require the 60 votes in the Senate.

Home and community services

  • Working with Congress to approve legislation to ensure seniors and people with disabilities can access home care services and to provide support to caregivers.

HMA and HMA companies are closely monitoring these federal policy developments. We can assist healthcare stakeholders in responding to the immediate opportunities and challenges that arise and contextualize these actions for longer-term strategic business and operational decisions.

If you have questions about these or other federal policy issues and how they will impact your organization please contact Andrea Maresca ([email protected]) or Liz Wroe ([email protected]).

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How will changes to Medicare Part C and D Star Ratings impact your plan?

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What are your plans to minimize your risk to avoid dropping in your Star Rating or to plan a head to maintain or improve your Star Rating?

On February 1, 2023, the Center for Medicare and Medicaid Services (CMS) released the 2024 Advance Notice and included some key specifics on the upcoming changes to the Medicare Star Rating program. CMS is proposing changes that will align with the recently announced “Universal Foundation” of quality measures, a core set of measures that are aligned across CMS quality rating and value-based care programs. The Advance Notice also included information on substantive measure specification updates, new measure concepts, and the addition of measures to align with other CMS programs.

You can learn more about these proposed changes along with a blueprint for improving your Medicare Advantage Star Ratings at the HMA quality conference on March 6 in Chicago. The working session “Moving the Needle on Medicare Stars Ratings” will feature speakers Katharine Iskrant, MPH, CHCA, CPHQ, HEDIS/Stars Auditor, President and Owner, Healthy People; John Myers, BS, M.Eng., VP of Health Quality & Stars, Humana; Vanita Pindolia, PharmD, MBA, VP of Stars Program, Emergent Holdings; and Dr. Kate Koplan, MD, MPH, FACP, CPPS, Chief Quality Officer & Associate Medical Director Quality and Safety, Kaiser Permanente of Georgia

Moderators of this session are HMA’s Mary Walter, Managing Director of Quality and Accreditation, and David Wedemeyer, Principal. Both have health plan legacy experience in Stars strategy, execution and getting results.

Objectives of this session:

  1. Overview of the CMS proposed changes and their impact on the Stars program
  2. Attendees will obtain a blueprint for improving Medicare Advantage Star Ratings, including the importance of ensuring executive management buy-in
  3. Discussion of how the use of data analytics can help plans to identify quality gaps, target interventions, and track improvement
  4. Strategies to avoid the type of siloed initiatives that often fail to achieve lasting results
  5. Speakers will also address the importance of quality in achieving market viability and financial
    sustainability

Stay in the know about the upcoming proposed changes and develop your organization’s strategy in this interactive impactful working session. This session will allow attendees to integrate any learnings and take-aways into your Stars program to meet your overall Star Rating strategic goal.

Follow #HMAtalksQuality on Twitter and LinkedIn for more updates on Stars and quality initiative efforts throughout the year. View the full agenda and register for HMA’s first annual quality conference on March 6 in Chicago. Registration closes on February 21, 2023.

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What is “adequate” behavioral health provider capacity?

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At HMA, our subject matter experts get questions every day from people working in state agencies, counties, health plans and provider groups about how to “right size” the behavioral health continuum to obtain equitable access for growing behavioral health demand. From legislatures to providers, improving access to mental health services is critical to improving overall health outcomes. It is time for behavioral health to create a specific definition of network adequacy that accounts for the complexity and nuance of access to mental health and substance use care. It is time to identify and define the factors that lead to “adequate” provider capacity, to ensure that the right level of care is available to individuals when they need care. Network adequacy in behavioral health needs an overhaul to meet the complexity that is driving access challenges.

Together let’s re-define what “adequate” means in behavioral health to ensure we build systems that meet the needs of communities. At HMA’s quality conference on March 6 in Chicago, the “Developing a Behavioral Health Quality Strategy” working session will engage participants in an in-depth discussion on identifying factors to inform a more accurate definition of behavioral health network adequacy. Speakers will outline some of the core challenges in network adequacy and innovations they have used.  Attendees will work collaboratively in a structured exercise on three knotty challenges within network adequacy to identify factors that could improve measurement for states, plans and providers. The goal is for participants to walk away with tangible actions they can implement in their work on behavioral health access.

Please join HMA’s Serene Olin, Rachel Bembas, and Gina Lasky with our expert panelists:

Nazlim Hagmann, MD, Chief Medical Officer, Commonwealth Care Alliance

Rhonda Robinson Beale, MD, SVP, Chief Medical Officer, Mental Health Services, UnitedHealth Group

Claire Wang, MD, ScD, Associate Deputy Director, Delaware State Department of Health and Social Services, Division of Substance Abuse and Mental Health

And follow #HMAtalksQuality on Twitter and LinkedIn for more updates on behavioral health quality efforts throughout the year. View the full agenda and register for HMA’s first annual quality conference on March 6 in Chicago. Registration closes on February 21, 2023.

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CMS creating a ‘Universal Foundation’ to align quality measures

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Leaders at the Centers for Medicare and Medicaid Services (CMS) announced in the New England Journal of Medicine this month a new initiative called the “Universal Foundation,” which seeks to align quality measures across the more than 20 CMS quality initiatives. The implications for the broader healthcare system are immense. 

At Health Management Associates upcoming quality conference March 6 in Chicago, Dr. Lee Fleisher, one of the authors of the Universal Foundation initiative and, Chief Medical Officer and Director, CMS’ Center for Clinical Standards and Quality, will deliver the keynote address “A Vision for Healthcare Quality: How Policy Can Drive Improved Outcomes.”

Attendees will hear from industry leaders and policy makers about evolving healthcare quality initiatives and participate in substantive workshops where they will learn about and discuss solutions that are using quality frameworks to create a more equitable health system. In addition to Dr. Fleisher, featured speakers will include executives from American College of Surgeons, ANCOR, CareJourney, CareOregon, Commonwealth Care Alliance, Council on Quality and Leadership, Denver Health, Institute on Public Policy for People with Disabilities, Intermountain Health, NCQA, Reema Health, Kaiser Permanente, Social Interventions Research and Evaluation Network, UnitedHealth Group, United Hospital Fund, 3M, and many other organizations.

The Universal Foundation seeks to align quality measures to “focus providers’ attention on measures that are meaningful for the health of broad segments of the population; reduce provider burden by streamlining and aligning measures; advance equity with the use of measures that will help CMS recognize and track disparities in care among and within populations; aid the transition from manual reporting of quality measures to seamless, automatic digital reporting; and permit comparisons among various quality and value-based care programs, to help the agency better understand what drives quality improvement and what does not.”

CMS has established a cross-center working group focused on coordination of these processes and on development and implementation of aligned measures to support a consistent approach. As part of this announcement, the group published a list of Preliminary Adult and Pediatric Universal Foundation Measures. This new quality program will affect clinicians, healthcare settings such as hospitals or skilled nursing facilities, health insurers, and value-based entities such as accountable care organizations.

HMA can help organizations improve their quality efforts in line with the new CMS Universal Foundation initiative. HMA’s more than 500 consultants include past roles as senior officials in Medicaid and Medicare, directors of large nonprofit and social services organizations, top-level advisors, C-level executives at hospitals, health systems and health plans, and senior-level physicians. Our depth of industry-leading policy expertise and clinical experience provides comprehensive solutions that make healthcare and human services work better for people.

To learn more about HMA and Quality, follow #HMAtalksQuality on Twitter and LinkedIn. View the full agenda and register for HMA’s first annual quality conference on March 6 in Chicago. Registration closes on February 21, 2023.

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CMS Introduces Advance Notice of Methodological Changes for MA Capitation Rates and Medicare Part C and Part D Payment Policies

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This week, our In Focus section reviews recently announced major policy updates from the Centers for Medicare & Medicaid Services (CMS) that affect the Medicare Advantage (MA) and Part D programs. First, on January 30, CMS released the final Risk Adjustment Data Validation Final Rule, a highly anticipated and controversial policy that establishes the agency’s approach to auditing MA Organizations’ (MAOs) risk-adjustment payments and collecting overpayments as needed.

Then, on February 1, CMS published the Calendar Year (CY) 2024 Advance Notice for the MA (Part C) and Part D Prescription Drug Programs. Between these two directives and the proposed MA policy changes CMS announced in December 2022, the Administration continues its efforts to actively manage Medicare Advantage and strengthen quality and oversight of the program. HMA’s summary of the December 2022 proposed rule is available here.

Below are some highlights of the 2024 Advance Notice. By law, CMS must notify the public of planned changes in the MA capitation rate methodology and risk adjustment methodology annually. The deadline for submitting comments to CMS is Friday, March 3, 2023.

Payment Impact in MA: CMS is projecting an average increase in revenue of 1.09 percent in plan payments from last year. This percentage increase is based on a net number that reflects multiple factors including growth rates, change in STAR ratings, and risk score trends.

Risk Adjustment: CMS is seeking to make some refinements to the Part C risk-adjustment model. For example, CMS will begin using the International Classification of Diseases (ICD)-10 classification system (instead of the ICD-9 classification system) and updated underlying fee for service data years. More specifically, diagnoses data years are being updated from 2014 to 2018, and expenditure years are being updated from 2015 to 2019 to reflect changes in costs.

Star Ratings: CMS is proposing updates and refinements to the Star Ratings program, including:

  • Retiring the diabetes care-kidney disease monitoring and Medication Reconciliation Post-Discharge
  • Expanding the age range for colorectal cancer screening measure to 45−75 years old to align with the preventive task force
  • Adding the Care for Older Adults (COA)—Functional Status Assessment measure back to the Star Ratings, and introducing Kidney Health Evaluation for Patients with Diabetes (KED), Concurrent Use of Opioids and Benzodiazepines (COB), Polypharmacy Use of Multiple Anticholinergic Medications in Older Adults (Poly-ACH), and polypharmacy Use of Multiple Central Nervous System Active Medications in Older Adults (Poly-CNS)
  • Introducing a case-mix adjustment to Part D medication adherence measures for diabetes, hypertension, and cholesterol.

CMS also is seeking to potentially align measures with other CMS programs. Specifically, the agency is introducing a “Universal Foundation” of quality measures, which is a core set of metrics aligned across programs. Additional information can be found in this New England Journal of Medicine “Perspective”.

Part D Impact

The Advance Notice also notifies plans on the changes to the Part D benefit occurring in 2024 as a result of the Inflation Reduction Act (IRA), including:

  • Beginning in CY 2024, CMS will eliminate cost-sharing for Part D drugs prescribed to beneficiaries in the catastrophic phase of coverage.
  • Beginning in CY 2024, the Low-Income Subsidy program (LIS) under Part D will be expanded so that beneficiaries who earn 135−150 percent of the federal poverty level and meet statutory resource limit requirements will receive the full LIS subsidies that were available only to beneficiaries earning less than 135 percent of the federal poverty level prior to 2024.
  • During CY 2024, CMS will prohibit Part D plans from applying the deductible to any Part D covered insulin product and from charging more than $35 for each month’s supply of a covered insulin product in the initial coverage phase and the coverage gap phase.
  • During CY 2024, CMS will prohibit Part D plans from applying the deductible to an adult vaccine recommended by the Advisory Committee on Immunization Practices and from charging any cost-sharing payments at any point in the benefit for these vaccinations.
  • Beginning in CY 2024, CMS will cap the growth in the Base Beneficiary Premium at 6 percent. The Base Beneficiary Premium for Part D is limited to the lesser of a 6 percent annual increase or the amount that would otherwise apply under the prior methodology had the IRA not been enacted.

The HMA Medicare team will continue to analyze these proposed changes. We have the depth and breadth of expertise to assist with tailored analysis, to model policy impacts across the multiple rules, and to support the drafting of comment letters on this notice.

If you have questions about the contents of CMS’s MA advance notice and how it will affect MA plans, providers, and patients, contact Julie Faulhaber ([email protected]), Amy Bassano ([email protected]), or Andrea Maresca ([email protected]).

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California first in nation to receive federal approval for justice-involved reentry demonstration initiative

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This week, our In Focus section reviews the California amendment to the Section 1115 Waiver Demonstration titled, “California Advancing and Innovating Medi-Cal (CalAIM),” approved by the Centers for Medicare & Medicaid Services (CMS) on January 26, 2023. The amendment will provide targeted Medi-Cal services to individuals in state prisons, county jails, and youth correctional facilities for up to 90 days prior to release. This marks the first time in the nation that Medicaid will pay for a limited set of health care services provided to justice-involved individuals before they are released. The approval is effective through the end of the CalAIM demonstration, ending December 31, 2026, unless extended or amended.

The justice-involved initiative is part of the broader CalAIM demonstration, approved December 29, 2021. For more information on CalAIM, please see HMA’s write up from March 2021.

Background

California was one of the first of 11 states – Arizona, California, Kentucky, Massachusetts, Montana, New Jersey, New York, Oregon, Utah, Vermont, and Washington – to propose a demonstration to provide Medicaid-covered healthcare services to justice-involved populations before release. CMS plans to issue guidance on the Reentry Demonstration Opportunity to support community reentry and improvement in care transitions for individuals up to 30 days prior to their scheduled release.

California’s reentry demonstration initiative aims to address the needs of incarcerated beneficiaries as they near the end of their incarceration and reenter the community by improving connections and coordination between the correctional, health care, and social service systems. Currently, Medi-Cal services are only available after release from incarceration.

In California, more than one million adults and youth enter or are released from prisons and jails annually, with at least 80 percent eligible for Medi-Cal. The justice-involved individuals are disproportionately people of color, compared to the state population. Formerly incarcerated individuals are also more likely to experience poor health outcomes and face disproportionately higher rates of physical and behavioral health diagnoses. These individuals are at higher risk for injury and death as a result of violence, overdose, and suicide compared to people who have never been incarcerated.

Demonstration

California will be required to submit for CMS approval a Reentry Initiative Implementation Plan and Reinvestment Plan documenting how the state will operationalize coverage and provision of pre-release services and how existing state funding for carceral health services will continue to support access to necessary care and achievement of positive health outcomes for the justice-involved population.

The goals of the demonstration are to:

  • Increase coverage, continuity of coverage, and appropriate service uptake through assessment of eligibility and availability of coverage for benefits in carceral settings just prior to release;
  • Improve access to services prior to release and improve transitions and continuity of care into the community upon release;
  • Improve coordination and communication between correctional systems, Medicaid and CHIP systems, managed care plans, and community-based providers;
  • Increase additional investments in health care and related services, aimed at improving the quality of care for beneficiaries in carceral settings and in the community to maximize successful reentry post-release;
  • Improve connections between carceral settings and community services upon release to address physical health, behavioral health, and health-related social needs;
  • Provide intervention for certain behavioral health conditions and using stabilizing medications like long-acting injectable anti-psychotics and medications for addiction treatment for SUDs, with the goal of reducing decompensation, suicide-related deaths, overdoses, and overdose-related deaths in the near-term post-release; and
  • Reduce post-release acute care utilizations such as emergency department (ED) visits and inpatient hospitalizations and all-cause deaths among recently incarcerated Medicaid beneficiaries and individuals otherwise eligible for CHIP if not for their incarceration status through robust pre-release identification, stabilization, and management of certain serious physical and behavioral health conditions that may respond to ambulatory care and treatment (e.g., diabetes, heart failure, hypertension, schizophrenia, SUDs) as well as increased receipt of preventive and routine physical and behavioral health care.”

Eligible individuals under the demonstration will be assigned a care manager while they are incarcerated, as well as a community-based care manager upon their release. Pre-release services will be anchored in comprehensive care management and include physical and behavioral clinical consultation, lab and radiology, Medication Assisted Treatment (MAT), community health worker services, and medications and durable medical equipment. These services will be available for up to 90 days immediately prior to the individual’s expected release date. California expects that it will be able to reduce decompensation, suicide-related death, overdose, and overdose-related deaths in the near-term post-release.

As a condition of approval of this demonstration amendment, CMS is also requiring California to make pre-release outreach, along with eligibility and enrollment support, available to all individuals incarcerated in the facilities in which the demonstration is functioning. Effective January 1, 2023, state statute directs all counties implementing Medi-Cal application processes in county jails and youth correctional facilities to “suspend” their status while an individual is in jail or prison, and easily “turn on” when they enter the community so they can access essential health care services upon release.

The demonstration is expected to begin in April 2024. Correctional facilities can choose their launch date within 24 months of the go-live date and will be subject to a readiness review process before they can launch.

Additional Requirements

Under the amendment, CMS approved the state’s Designated State Health Program (DSHP) financing plan. Under this DSHP, California will receive federal matching funds to support the Providing Access and Transforming Health (PATH) program. As a condition of receiving this funding and as part of the approval, CMS requires California to increase and sustain Medicaid fee-for-service provider payment rates and Medicaid managed care payment rates for obstetrics, primary care, and behavioral health services. According to the U.S. Department of Health and Human Services (HHS), “in obstetrics alone, this represents the potential for $60 million to be invested in the health of pregnant and postpartum women by increasing access to providers and therein improving health outcomes for pregnant women.” The rate increase will close the gap between Medicaid and Medicare rates by at least 2 percentage points, should the state’s average Medicaid to Medicare provider rate ratio be below 80 percent in any of these categories.

Under this amendment, CMS is also updating the budget neutrality methodology for two previously approved community supports, short-term post-hospitalization services and recuperative care, that address health-related social needs.

Link to Waiver Amendment