Tag Archives: Medicaid Expansion

Payers Administering Medicaid Are About to Get New Hit with Fed Regulations

Medicaid administration has been a growing business for payers over the past several years.  (See WellPoint/Anthem’s acquisition of Amerigroup as an example).  With Medicaid membership increased as a result of the Affordable Care Act, this increase also means big profits to these payers.  CMS has recently issued a proposed rule that would greatly overhaul Medicaid administration.  According to this article published on govhealthit.com, here are 5 major reasons for this:

1. It’s not just core Medicaid for the poor that is shifting to managed care. So is CHIP, which covers kids in lower-income families that make too much to qualify for Medicaid. So is long-term Medicaid care for the elderly and the disabled, which is where the program touches some middle-class families. Among other goals, HHS wanted to harmonize the rules between the programs and the different populations served.

2. Managed care is a huge business. Private insurers booked $115 billion in Medicaid revenue last year, according to data compiled from regulatory filings by Mark Farrah Associates and analyzed by Kaiser Health News. Operating profit on those premiums came to $2.4 billion. Net profit, after accounting for taxes, depreciation and other expenses not directly connected to health coverage, would have been less. Even so, HHS decided to limit insurer profits by creating a minimum medical loss ratio, similar to standards put in place for other health coverage by the federal health law. Insurers would have to plan to spend at least 85 percent of their revenue on medical care, not on administrative costs or profit.

3. Capitalizing on “member churn” between Medicaid plans and commercial coverage is a key insurer strategy. Fluctuating incomes cause people to cycle in and out of Medicaid. When a member gets a job and loses her Medicaid eligibility, her insurer wants to keep the business by signing her up for a commercial plan sold through the health law’s online exchanges. HHS’ new rules are supposed to control that process — allowing plans to educate members to promote coverage continuity but still prohibiting cold calls, spam and knocks on the door.

4. Doctor networks for Medicaid plans aren’t all they’re supposed to be. In a national survey last year by HHS’ inspector general, half the doctors listed in official plan directories weren’t taking new Medicaid patients. HHS now wants states to certify at least annually, perhaps based on direct queries to doctors, that enough caregivers are in the managed-care network and close enough to plan members to serve them.

5. Health-care quality scores are the future. HHS awards stars to Medicare managed care plans for seniors based on benefits, member satisfaction and management of chronic conditions. Medicare has also started grading hospitals with star scores.


New Study Shows ACA Medicaid Expansion Yielded More Newly Diagnosed Diabetes Patients

With the newly insured 16.4 million Americans enrolled in health insurance (Medicaid and individual policies), a lab company has released a paper where they are seeing an uptick in newly diagnosed diabetes cases.  At a glance, this seemingly makes sense:  those who were previously just outside of Medicaid’s eligibility that got newly insured would seemingly have a chronic condition that plagues a large proportion on our population, especially those on the lower end of socioeconomic status.

Does correlation equal causation in this case?

In my opinion, it’s a bit dubious to jump to this conclusion since the sample size of the study was small, data only comes from one lab company, and there wasn’t sufficient information in the lab claims data to determine whether the member was previously diagnosed and/or never was insured.

The Results are In: ER Visits After Medicaid Expansion are Temporary

One of the biggest fears for those who were against (or hesitant, to say the least) against the Medicaid expansion that was one of the pillars of the Affordable Care Act was that this newly insured population would flock to the Emergency Department and be a drain on the system.  A year later, the statistics are in for California.  The findings?  The run on the ER is temporary.

Read more here.

PA’s Medicaid Expansion Alternative Gets Interest from Health Insurers

Pennsylvania is one of 4 states that elected for Medicaid expansion but in an alternative fashion.  (Arkansas, Iowa, and Michigan are the other three).  CMS has not yet approved of this expansion, to be named Healthy Pennsylvania, that would assist beneficiaries w/subsidized premiums.  This is getting closer to reality w/private insurers ranging from Independence Blue Cross, Geisinger, and Aetna expressing interest in covering members in areas throughout the entire state.  Read more here.