The Alliance of Community Health Plans (ACHP) says it’s time to modernize Medicare Advantage (MA) to foster choice and competition, increase incentives for quality of care, and to make it simpler for seniors to choose a plan. And the national payer organization has unveiled a road map to make it happen.
ACHP this week launched its vision for “MA for Tomorrow,” a detailed proposal for policymakers to fix what it describes as MA’s shortcomings and to better serve American seniors. “MA for Tomorrow curbs abusive practices, reduces clinician burden, smooths the shopping experience and pushes quality standards to new heights,” says Ceci Connolly, president and CEO, ACHP.
The organization’s vision for MA provides greater choice, higher quality, and long-term sustainability based on five pillars:
Raising the bar on quality
ACHP says the measurers for Star ratings are outdated and place too much focus on process rather than health. Stars were introduced in 2012 to drive meaningful competition and reward the highest quality. But they have been watered down in recent years and today nearly 75 percent of MA members are enrolled in plans with 4 or more stars. MA for Tomorrow aims to:
Move away from topped out process measures and increase patient experience and outcomes measures: Most of the current process measures leave little room for improvement or differentiation between health plans, according to ACHP. To modernize the program, the MA program needs to replace these measures with quality metrics that focus on patient experience and outcomes measures that are most important to MA members. ACHP suggests CMS retire 10 process measures and place greater value on measures with opportunity for meaningful differentiation.
Improve measure collection to accurately reflect patient experience and outcomes: Current data collection methods using electronic medical records and consumer surveys don’t fully capture the senior population, according to ACHP, noting that they often exclude consumers with limited technological access, people of color, and those with English as a second language. The organization wants to improve survey measure collection to reach more seniors, increase response rates, and account for cultural and health equity differences. CMS must revamp survey tools using new technology, community-based organizations, and a timelier survey collection, according to ACHP.
Establish the number of MA plans that achieve high quality: MA for Tomorrow would limit the number of plans that can achieve a 4-Star or above rating to differentiate the highest quality plans and create distinction in plan performance. High ranking plans would still have the opportunity to receive quality bonuses. ACHP says CMS should establish limitations in rulemaking, such as an equal distribution of Star ratings from 3 to 5 stars, creating a bell curve distribution that reflects the excellence in achieving above average ratings, or setting other predetermined thresholds.
Improving consumer navigation
The popularity of MA has led to seniors having 44 plan options to choose from and they are often inundated with television commercials, mail solicitations, and unwelcome phone calls that complicate shopping for the right health plan. MA for Tomorrow aims to:
Rein in misleading marketing: Although the Centers for Medicare & Medicaid Services (CMS) has taken steps to crack down on misleading marketing and advertising practices in the 2024 MA and Part D Final Rule, ACHP says more action is needed to directly regulate third-party marketing organizations and lead generation firms. The organization wants to establish a cap on health plan payments to marketing organizations; provide a fast-track review process for 5-Star MA plans; and strengthen oversight/penalties for misleading and inaccurate marketing.
Standardize broker payment: While CMS regulation sets maximum enrollment commissions to brokers, the agency doesn’t set limitations on administrative fees for services such as marketing, compliance, IT, or health risk assessments. Brokers can collect as much as $1,300 per enrollee each year, which is more than double the maximum commission set by CMS and creates misaligned incentives to steer seniors and drives up administrative costs, ACHP says. The new vision for MA would restructure broker compensation to foster fair competition and high performance. CMS would standardize and limit override and administrative broker fees and would require plans to report total broker compensation amounts.
Offer incentives for enrollment in high-quality and value-based health plans: ACHP says MA brokers have incentives to steer consumers toward plans that offer the highest payment rather than plans best suited for their needs. Under the MA for Tomorrow plan, brokers would receive incentives to enroll customers in high-quality and value-based plans. CMS has the authority to set broker reimbursement amounts and should allow for a bonus payment to brokers who enroll consumers in a high-quality plan (Star rating of 4 or higher). This would mean more seniors would be served by the highest-performing plans and encourage plans to prioritize patient experience and health outcomes as the crucial performance metric.
Advancing risk adjustment for care not codes
Risk adjustment should provide sufficient resources for health plans and providers to manage care effectively, but too often MA plans try to maximize risk adjustment to drive goals and care becomes the afterthought, according to ACHP. MA for Tomorrow would establish a risk adjustment policy that provides resources to care for all disease factors and demographic characteristics of each consumer while limiting opportunities to game for financial gain. ACHP proposes the industry:
Calibrate the risk adjustment model on MA encounter data: The current risk adjustment model is calibrated using fee-for-service claims data and doesn’t account for differences in coding patterns between volume-based and value-based care, ACHP notes. In the future, MA would recalibrate the risk adjustment model to use MA encounter data–which documents an individual’s diagnoses, treatments, and services–to improve payment accuracy and mitigate the effects of overly aggressive coding. CMS has collected MA encounter data for more than a decade and has the authority to use this information to calibrate a risk adjustment model that more accurately reflects care needs for patients and removes opportunities to code inappropriately.
Tier the coding intensity adjustment: All MA plan payments are adjusted for the health status of each senior, providing plans with financial resources to deliver comprehensive care for individuals with more complex conditions and higher medical costs. The more documented conditions a consumer has, the higher the risk score and the higher the payment. The Affordable Care Act requires CMS to apply an intensity adjustment to account for differential coding practices between traditional fee-for-service Medicare and MA. CMS currently applies a standard adjustment to all MA plans despite the significant variance in coding intensity by plan. As coding practices differ, so should the coding intensity adjustment. ACHP calls for applying different levels of coding intensity by tiering plans based on coding aggressiveness and targeting larger adjustments to plans that are significantly higher than the industry averages. Tiering coding intensity adjustments will deter outliers, reduce aggressive coding behavior, and level the playing field in MA. CMS has the authority to tier the coding intensity adjustment and establish methodology through the annual Rate Notice and MA and Part D regulation.
Target Risk Adjustment Data Validation (RADV) audits: RADV audits are an important program integrity tool to recover improper overpayments made to health plans and discourage aggressive risk adjustment. Audits are expensive and time consuming for plans and regulators. To be most impactful, audits cannot be random; they must focus on health plans with higher likelihood for coding abuses, ACHP says. MA for Tomorrow targets RADV based on criteria that focus audits on the health plans with significant risk adjustment deviations from the industry average. Establishing clear RADV guidelines and targeting audits creates a more efficient, effective program that curtails bad actors and protects the Medicare dollar. Following the RADV audit guidelines in the final January 2023 regulation, CMS should clarify the criteria for selection in sub-regulatory guidance or future regulation.
Modernizing network composition
Today, the adequacy of MA provider networks is measured by the number and type of providers located within specific, often stringent, distances from the member’s home. ACHP says that is outdated given virtual and team-based health care, which allow clinicians to work to the top of their license, partner with care teams for the patient and address workforce shortages, especially in rural and underserved areas. MA for Tomorrow would modernize network composition by establishing contemporary network adequacy standards. Outdated network adequacy standards based on time and distance would be replaced with standards that recognize innovations in care delivery such as virtual care and remote monitoring, as well as other measures of provider accessibility.
Transforming benchmarks
Benchmarks are the cornerstone of MA payments, establishing the maximum per beneficiary monthly payment to a health plan to cover basic Medicare benefits. The benchmark methodology is based on average spending in traditional fee-for-service Medicare adjusted by county. However, ACHP says that formula is outdated now that a majority of Medicare eligible seniors are enrolled in MA. A new MA benchmark methodology would better reflect average Medicare costs with incentives for quality and investments in coordinated care will drive fiscal sustainability of the program. MA for Tomorrow would transform the fee-for-service costs and better reflecting the changing composition of Medicare enrollment. It would incorporate stronger incentives for delivering high-quality care, removing restrictions on the quality bonus and reflecting costs for consumers enrolled in both Medicare Parts A and B.