the view from washington government-sponsored health...

THE VIEW FROM WASHINGTON GOVERNMENT-SPONSORED

HEALTH PROGRAMS

JOHN GORMANEXECUTIVE CHAIRMAN

NOVEMBER 15, 2016

A Presentation to the Texas Association of Health Plans

Copyright © 2016 Gorman Health Group, LLC

• Government health programs represent sole growth opportunity

• Likely election result = Medicare Advantage, Medicaid mostly OK. ObamaCare is toast. “Replace” = ???

• Duals, Long-Term Services and Supports (LTSS) exploding

• Disruptive growth, share aggregation, and new entrants

• Star Ratings, risk adjustment drive the market, and bar is rising

• “A Darwinian and Edisonian moment”

CUT TO THE CHASE!


TRUMP HEALTH PRIORITIES

• Repeal the Affordable Care Act• Make individual health insurance tax

deductible• Sale of insurance across state lines• Expand Health Savings Accounts• Provide price transparency• Allow importation of drugs• Block grant Medicaid


ELECTION IMPACT: UNPREDICTABLE

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••Gradually sunsets ACA••Preserves subsidies,

Medicaid expansion until replacement decided on

Budget Reconciliation

••Repeal ASAP, delay effect••“Replace” consensus will

take time

Selective “Repeal”, Gradual

“Replace”

2017’S TWO PATHS TO “REPEAL AND REPLACE”

Assumes Restoring Lost Coverage is Political Priority for GOP

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What Probably Stays• Pre-existing conditions ban• Lifetime coverage cap • Adult dependents on parents’

plans until 26• Medicaid expansion• State Innovation Grants• CMS Innovation Center

What Likely Goes• Individual Mandate• Subsidies• “The Exchanges”…in 2018-2019• Taxes: Cadillac, medical devices,

insurer taxes, etc.• Limits on HSAs• Essential Health Benefits rules• Independent Payment Advisory

Board (IPAB)

“REPEAL” = MARKETING TO GOP BASEGOP Already Softening on Unraveling

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LIKELY HEALTH POLICY IN 2017-18“ABOVE AND BELOW WATER LINE”

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Regulations/Guidance

Star Ratings/QRS

Risk Adjustment

ACA Repeal/Replace Opioid Treatment

Medicaid expansions, LTSS waivers

MACRA delays

Compliance

Abortion Restrictions


Dr. Ben Carson••Former neurosurgeon••2016 Presidential candidate

Mike Huckabee••Former Arkansas governor••2016 Presidential candidate

Rick Scott••Florida governor••Former CEO, HCA

Bobby Jindal••Former Louisiana governor••Former Secretary of LA Health & Hospitals

CANDIDATES FOR TRUMP’S HHS CHIEF

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Exchanges Medicaid Medicare Advantage Dual Eligibles

“TIPPING POINT” INGOVERNMENT-SPONSORED PROGRAMS

Commercial Group: Declining, ShiftingGovernment: Sole Source of Organic Growth

2016 2025

1 M

11 M

2016 2023

18 M

29 M

2016 2022

63 M

82 M

2016 2020

13 M

20 M


0% 200% 400% 600% 800% 1000% 1200% 1400% 1600%

WellCare

Cigna

Humana

United

Aetna

Centene

Carrier Stock Increases Since Passage of ACA

“TIPPING POINT” INGOVERNMENT-SPONSORED PROGRAMS

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• Expect more states to adopt expansion once Obama leaves office• Expect more complexity and variability in “conservative principles”

STATUS OF STATE MEDICAID EXPANSION

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MEDICAID ENROLLEES AND EXPENDITURES

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MORE THAN HALF OF ALL MEDICAID BENEFICIARIES ARE ENROLLED IN HEALTH PLANS


DEMOGRAPHICS = DESTINY


FINANCIAL ALIGNMENT DEMONSTRATIONS FOR DUAL ELIGIBLES


CAPITATED MEDICAID MLTSS WAIVERS STATUS – 2016

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MANY STATES MOVING ON DUALS/LONG-TERM CARE (LTC)

Source: http://kff.org/medicaid/report/medicaid-and-long-term-services-and-supports-a-primer/

Many States Participating in Multiple HCBS Waivers/Options


MANAGED LTSS MOVES ON STATE BUDGETARY CRISES


Category 2012 MarginSNPs (total) 8.6%

Non-SNPs (total) 4.3%SNPs, nonprofit -0.6%SNPs, for-profit 11.5%

50%+ partial dual eligible 12.9%50%+ full dual eligible 5.7%

CAN SPECIAL NEEDS PLANS MAKE MONEY?

SNPs generally are more profitable than ALL other types of MA plans.

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Source: MedPAC 2015 Report to Congress, Table 13-6, p.332, March 2015.


CHALLENGES FACING PLANS: CHILDLESS ADULTS, DUALS, AND LTC

Enabling

Social

Clinical

•• Meals •• Transportation•• Personal care•• Habilitation•• Assistive devices

•• Home modification•• Communication services•• Light cleaning, personal care•• Caregiver respite

•• Care coordination•• Skilled nursing•• Caregiver training•• Palliative/EOL care


CURRENT CONTRACT SUMMARYNO. OF

CONTRACTSMA ONLY

ENROLLEESDRUG PLAN ENROLLEES

TOTAL ENROLLEES

Total “Prepaid” Contracts 694 2,024,780 16,492,112 18,516,892

Local CCPs 464 1,434,358 14,449,280 15,883,638PFFS 7 79,700 150,433 230,133MMP 62 0 362,039 362,0391876 Cost 16 337,340 278,164 615,5041833 Cost (HCPP) 9 49,418 0 49,418PACE 122 0 36,544 36,544MSA 3 3,208 0 3,208Regional PPOs 11 120,756 1,215,652 1,336,408

Total PDPs 72 0 24,887,662 24,887,662

Employer/Union Only Direct Contract PDP 5 0 116,149 116,149

All Other PDP 67 0 24,771,513 24,771,513

TOTAL 766 2,024,780 41,379,774 43,404,554

MEDICARE ADVANTAGE MEMBERSHIPNational Snapshot – September 2016

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Source: Medicare Advantage, Cost, PACE, Demo, and Prescription Drug Plan Contract Report – Monthly Summary. Totals reflect enrollment as of the September 1, 2016 payment. The September payment reflects enrollments accepted through August 12, 2016.


GEOGRAPHY OF MA GROWTH, 2006-2015


Largest 10 MA Plans: 67%United and

Humana: 38%

All Others: 33% ••Non-Anthem Blues: 12%

SHARE AGGREGATION WILL CONTINUETop 15 Plan Market Share Has Grown 3000+ BPs In 10 Years


STAR RATINGS DRIVE THE MARKET

• Medicaid, Obamacare already following MA approach

• Medicare Advantage plans beat commercial in HEDIS

• <4-Star plans “circling the toilet bowl”

• ≤3-Star plans “dead men walking”

• .5 Star = ~ $15-$50 PMPM

StarRating Complaints/1,000

%DisenrollAnnually

«« 0.91 21.5%«« ½ 0.55 17.48%««« 0.42 14.79%««« ½ 0.33 9.27%«««« 0.22 6.92%«««« ½ 0.15 4.89%««««« 0.16 1.91%

Copyright © 2016 Gorman Health Group, LLCCopyright © 2015, Gorman Health Group, LLC

20142015

2016

3.84AVG STAR RATING 3.92

AVG STAR RATING

4.03AVG STAR RATING

49% of MA-PDs (179 contracts) ≥4 Stars

71% of MA-PD enrollees in ≥4 Star contracts

40% of MA-PDs ≥4 Stars


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Final Year of Star Ratings Demo

2017

4.00AVG STAR RATING

49% of MA-PDs (178 contracts) ≥4 Stars


ACHIEVING THE GOAL?


2017 PART C STAR RATINGS MEASURES

ID Measure Data Source WeightC01 Breast Cancer Screening HEDIS 1

C02 Colorectal Cancer Screening HEDIS 1

C03 Annual Flu Vaccine CAHPS 1

C04 Improving/Maintaining Physical Health HOS 3

C05 Improving/Maintaining Mental Health HOS 3

C06 Monitoring Physical Activity HEDIS/HOS 1

C07 Adult BMI Assessment HEDIS 1

C08 Special Needs Plan (SNP) Care Management Part C Reporting 1

C09 Care for Older Adults: Medication Review HEDIS 1

C10 Care for Older Adults: Functional Status Assessment

HEDIS 1

C11 Care for Older Adults: Pain Assessment HEDIS 1


2017 PART C STAR RATINGS MEASURES (CONT.)

ID Measure Data Source WeightC12 Osteoporosis Management for Women with Fx HEDIS 1

C13 Diabetes Care: Eye Exam HEDIS 1

C14 Diabetes Care: Kidney Disease Monitoring HEDIS 1

C15 Diabetes Care: Blood Sugar Controlled HEDIS 3

C16 Controlling Blood Pressure HEDIS 3

C17 Rheumatoid Arthritis Management HEDIS 1

C18 Reducing Risk of Falling HEDIS/HOS 1

C19 Plan All-Cause Readmissions HEDIS 3

C20 Getting Needed Care CAHPS 1.5

C21 Getting Appointments and Care Quickly CAHPS 1.5

C22 Customer Service CAHPS 1.5


2017 PART C STAR RATINGS MEASURES (CONT.)

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ID Measure Data Source WeightC23 Rating of Health Care Quality CAHPS 1.5

C24 Rating of Health Plan CAHPS 1.5

C25 Care Coordination CAHPS 1.5

C26 Complaints About the Health Plan CTM 1.5

C27 Members Choosing to Leave the Plan MBDSS 1.5

C28 Beneficiary Access and Performance Problems CMS Admin Data 1.5

C29 Health Plan Quality Improvement Star Ratings 5

C30 Plan Makes Timely Decisions About Appeals IRE 1.5

C31 Reviewing Appeals Decisions IRE 1.5

C32 Call Center: Foreign Language Interpreter, TTY Call Center 1.5


2017 PART D STAR RATINGS MEASURESID Measure Data Source WeightD01 Call Center: Foreign Language Interpreter, TTY Call Center 1.5

D02 Appeals Auto-Forward IRE 1.5

D03 Appeals Upheld IRE 1.5

D04 Complaints About the Drug Plan CTM 1.5

D05 Members Choosing to Leave the Plan MBDSS 1.5

D06 Beneficiary Access and Performance Problems CMS Admin Data 1.5

D07 Drug Plan Quality Improvement Star Ratings 5

D08 Rating of Drug Plan CAHPS 1.5

D09 Getting Needed Prescription Drugs CAHPS 1.5

D10 MPF Price Accuracy PDEs, MPF Pricing 1

D11 High-Risk Medication PDEs 3

D12 Medication Adherence: Diabetes Medications PDEs 3

D13 Medication Adherence: HTN (RAS Antagonists) PDEs 3

D14 Medication Adherence: Cholesterol (Statins) PDEs 3

D15 MTM Program Completion Rate for CMR Part D Reporting 1


2017 AVERAGE RATINGS

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Reducing the Risk of Falling 2.4

MTM Completion Rate for CMR 2.4

SNP Care Management 2.5

Plan All-Cause Readmissions 2.5

Improving/Maintaining Physical Health 2.6

Osteo. Mgmt in Women With Fx 2.7Monitoring Physical Activity 2.9

Part C: Foreign Lang./TTY 4.2

Ben. Access & Performance Problems 4.2

Members Choosing to Leave the Plan 4.3

Adult BMI Assessment 4.4

COA – Medication Review 4.4

COA-Pain Assessment 4.5Complaints about the Health Plan 4.6

MPF Price Accuracy 4.7


Measure 2017 Rating 2016 Rating 2015 Rating

Improving Physical HealthDiabetes Care – Eye ExamDiabetes Care – Blood Sugar ControlledRheumatoid Arthritis ManagementGetting Needed CareGetting Appointments and Care QuicklyCustomer ServiceRating of Healthcare Quality Care CoordinationMembers Choosing to Leave the PlanPlan Makes Timely Decisions About AppealsReviewing Appeals DecisionsRating of the Drug Plan

2.63.43.73.93.33.33.53.43.44.33.53.43.3

3.33.13.93.23.53.43.53.43.44.24.13.63.3

4.63.73.33.53.43.53.53.73.44.34.23.73.5

STAGNATION: NO CHANGE IN NATIONAL AVERAGE (3 CONSECUTIVE YEARS)

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And…no or negligible change in Average Rating or National Average:• Annual Flu Vaccine• Monitoring Physical Activity• COA-Medication Review• Plan All-Cause Readmissions• Getting Needed Drugs


THE MEMBER EXPERIENCE: NOW HALF OF STARS


ü 35% of Rating = patient experience, access, and complaints

ü 11% of Rating = add’l CAHPS/HOS measures ü 12% of Rating = improvement

95%

90%

85%

80%

75%

70%

GettingNeededCareGettingAppts&CareQuicklyCustomerService

RatingofHealthCareQualityRatingofHealthPlanCareCoordination

RatingofDrugPlanGettingNeededDrugs

MEASURING NUANCES: CAHPS

Star Ratings must be strategically

managed as a program.

=20165Starcutpoint

=20164Starrange

=20163Starrange

=20162Starrange


Notification of Inpt. Admission

Receipt of Summary of Care Record

Engagement w/ Patient

within 30 Days of Inpt.

Discharge

Medication Reconciliation

Care Coordination for Members with 3+ chronic conditions

Comprehensive Assessment of Needs & Goals (Testing 2017)

Specialist Provides Visit Summary to

PCP (Testing 2017)

Follow-up after ED Visit within 7 days (Current Average:

34%)

A GLIMPSE INTO CMS’ CRYSTAL BALL:EVIDENCE-BASED COORDINATED CARE

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NCQA IMPAQ

Care Coordination Measures for Vulnerable

Populations

Patients with a Chronic Condition that have a Potentially Avoidable

Complication

Follow-up after Discharge from the ED for Mental

Health

Follow-up after Discharge from the ED for AOD

Follow-up after Hospitalization for Mental

Illness

Measures addressing gaps in coordination for

high-cost, high-prevalence chronic

conditionsFollow-up after Discharge from the ED for Diabetes

Follow-up after Discharge from the ED for Heart Failure

Follow-up after Hospitalization for Diabetes

Follow-up after Hospitalization for Heart

Failure

Duplication of HcA1c Tests


GEOGRAPHICAL DIFFERENCES: WHAT CAN WE LEARN FROM STAR RATINGS?

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IS THERE A SPILL-OVER EFFECT?

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OPPORTUNITIES FOR NEW RETAIL PHARMACY COLLABORATION

« Medication adherence« High-risk medications« Annual influenza vaccine« Care for older adults — medication

review, pain screening« Disease management — A1c control,

controlling BP« RA, osteoporosis management« Reducing fall risk

Evaluate opportunities for retail pharmacists to expand services tohigh-risk members through MTM-like programs and expanded services.


• CMS will reduce a measure to 1 star if:o Biased or erroneous data is submittedo An underlying compliance issue exists in the data

• Automatic reduction of overall rating to 2.5 stars for sanctioned plans suspended

• CMS is seeking feedback on how to better weigh the impact of audits, sanctions, and civil money penalties (CMPs) on Star Ratings

• Important areas to monitor:o HEDIS, CAHPS, HOS, MPF, and PDE data requirementso ODAG and CDAG processeso Adherence to CMS-approved POS editso Pass Data Validation such as SNP and MTM

COMPLIANCE, DATA INTEGRITY, AND STAR RATINGS

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• CMS compliance activity will be at an all-time high

• Penalties doubled for most infractions

• Priorities: o Delegation oversight,

especially PBMo Consumer protections o Network adequacy o Risk adjustment codingo Compliance effectiveness

2017 COMPLIANCE OUTLOOK


Source: CMS, Medicare Parts C & D Oversight and Enforcement Group 2014 Part C and Part D Program Annual Audit and Enforcement Report , October 2016.

CHALLENGES FACING PLANS: MEDICARE ADVANTAGE/PART D


Membership Accounting and Reconciliation

Proactive Member Service

Risk Adjustment Adaptation

Collaborative, Accountable

Providers

“Make It Work” Care

Management

Star Ratings Mastery; PBM

oversight

PROVEN TACTICS TO THRIVE IN GOLDEN AGE OF GOVERNMENT PROGRAMS

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CONCLUSIONS

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• Government programs will continue to drive revenue/earnings

• Exchanges are dead in 2018-2019• Medicare Advantage, Medicaid

expansion mostly safe• Star Ratings/QRS now drive the

market in Medicare and Medicaid• No innovation without collaboration.

o Most effective innovation in healthcare is low-tech, high-touch.

• “Vision without execution is hallucination.” – Edison


Gorman Health Group, LLC (GHG) is a leading consulting and software solutions firm specializing in government health programs, including Medicare managed care, Medicaid and Health Insurance Marketplace opportunities. For nearly 20 years, our unparalleled teams of subject-matter experts, former health plan executives and seasoned healthcare regulators have been providing strategic, operational, financial, and clinical services to the industry, across a full spectrum of business needs. Further, our software solutions have continued to place efficient and compliant operations within our client’s reach.

GHG offers software to solve problems not addressed by enterprise systems. Our Valencia™ software reconciles membership of more than 10 million members in Medicare, Medicaid and the Health Insurance Marketplace. Over 3,000 compliance professionals use the Online Monitoring Tool™ (OMT), our complete Medicare Advantage and Part D compliance toolkit, while more than 25,000 brokers and sales agents are certified and credentialed using Sales Sentinel™. In addition, hundreds of health care professionals are trained each year using Gorman University™ training courses.

We are your partner in government-sponsored health programs

T

E

JOHN GORMANExecutive Chairman

202-255-6924

[email protected]

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