Stakeholders support CMS' plan to phase in risk adjustment over 3 years

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Health insurers and stakeholders have expressed support for the Centers for Medicare and Medicaid Services' plan to phase in changes to the risk adjustment model over three years, in the 2024 Medicare Advantage Program and Part D Payment Policies released Friday.

The model changes will begin in 2024, with the full brunt of phased-in risk adjustment to take effect in 2026, according to Susan Dentzer, president and CEO of America's Physician Groups.

"We're satisfied with this," said Susan Dentzer, America's Physician Groups president and CEO. "They mostly listened."

Insurers also voiced their support for the payment increase in the 2024 Medicare Advantage and Part D Rate Announcement.

CMS anticipates a payment increase for Medicare Advantage plans of 3.32% from 2023 to 2024 as a result of various changes, including in risk adjustment.

This compares to the 1.03% increase in revenue proposed in the 2024 Advance Notice released in February.

"We appreciate that CMS recognized the serious concerns with several proposed policies in the Advance Rate Notice that would affect MA enrollees in 2024, including by phasing in changes over a period of three years," said Matt Eyles, president and CEO of AHIP.  

"As the MA program continues to serve an increased share of Medicare-eligible Americans, it is essential for the public sector and the private market to work in partnership together, considering the perspective of all stakeholders and the impact of further changes to the Medicare Advantage program in a thoughtful, collaborative, and timely manner. A large bipartisan group of Congressional champions and other stakeholders stepped forward to demonstrate their strong support for beneficiaries and this program, which consistently delivers affordable, high-quality care to millions of Americans."
 
Better Medicare Alliance also said it appreciated the phased-in approach but remains concerned that the underlying policy remains unchanged.

"Better Medicare Alliance will continue to analyze the impact of the final rate announcement, especially on low-income beneficiaries, dual-eligible enrollees, and vulnerable populations," said Mary Beth Donahue, president and CEO of Better Medicare Alliance.
 
Margaret A. Murray, CEO of the Association for Community Affiliated Plans, said, "Notably, the rule phases in over three years significant changes to its risk-adjustment model, which measures the relative health of a plan's enrollees and affects health plan payment rates accordingly. ACAP will closely track how this change to the risk adjustment system will impact the dually eligible beneficiaries our plans serve, continue our constructive conversations with CMS to examine these impacts, and work to mitigate any unintended consequences these changes to the payment system may have on the coverage available for Medicare's most vulnerable set of enrollees."  

WHY THIS MATTERS

What CMS had proposed were dramatic changes in risk adjustment, Dentzer said.  

"They really pushed this through, fast. They've fully recognized in actions that to put this degree of change was not going to work," she said. "It was not responsive to stakeholders."

The finalized risk adjustment model reflects revisions focused on conditions that are subject to more coding variation.

An estimated 20 codes in particular were problematic, Dentzer said. "It was ill advised and too fast," she said.

THE LARGER TREND

CMS released technical and clinical updates to the MA risk adjustment model to keep it up to date and improve payment accuracy. 

One change made the transition to the Internal Classification of Diseases (ICD)-10 system, which is the coding classification system used throughout the U.S healthcare system since 2015, and updated data years.  

CMS also said it would start recovering improper payments made to insurance companies in Medicare Advantage. Proposed policies include: cracking down on abusive and confusing marketing schemes, addressing problematic prior authorization practices that prevent timely access to needed care, making it easier to access vital behavioral healthcare, and raising the bar on quality and driving toward more equitable care.
 

Twitter: @SusanJMorse
Email the writer: SMorse@himss.org

Juan Nanez will offer more detail in the HIMSS23 session "How Care Provider Access to Regional Data Reduces Hospital Readmissions." It is scheduled for Tuesday, April 18 at 11 a.m. – 11:30 a.m. CT at the South Building, Level 1, room S104.