CMS implemented several policy changes for Medicare Advantage plans in the first half of 2023, including adjusting payment rates and implementing stricter audits.
Research also uncovered new information about payments, quality and more in the program.
Here are 10 key updates about Medicare Advantage from the first six months of 2023 to know:
- Medicare Advantage plan enrollees have lower expenses than those with similar risk scores who remain in traditional Medicare, but payments to the program are based on traditional Medicare, according to a whitepaper from researchers at the University of Southern California in Los Angeles. Because Medicare Advantage enrollees tend to have lower expenses, but the government pays MA plans based on an average risk profile for traditional Medicare enrollees, overpayments could be higher than previous estimates, reaching $75 billion in 2023.
- Lawmakers are seeking more information about claims denials from the largest Medicare Advantage insurers. In May, the Senate Permanent Subcommittee on Investigations sent letters to CVS Health, Humana and UnitedHealth Group seeking internal documents detailing how the companies decide to approve or deny claims, including how the payers use artificial intelligence in the process.
- CMS issued a final rule that aims to streamline Medicare Advantage and Part D prior authorizations and clamp down on misleading marketing practices. The rule, published in April, implements several new restrictions on prior authorizations and prohibits Medicare Advantage ads that do not mention a specific plan name as well as ads that use words and imagery that may confuse beneficiaries.
- Enrollees in Medicare Advantage and traditional Medicare use less postacute care in markets with higher Medicare Advantage penetration, a study published in the April issue of Health Affairs found.
- CMS is moving ahead with Medicare Advantage risk adjustment changes payers and some provider groups opposed, but the agency will phase in the model over three years. In March, the agency said Medicare Advantage plans will see an average payment increase of 3.32 percent between 2023 and 2024, up from 1.03 percent in the advance notice.
- Medicare Advantage and Medicare supplement enrollees both reported high levels of satisfaction with their coverage but reported different worries, according to a survey from eHealth. Medicare supplement enrollees were more likely to list having their Medicare benefits reduced as their top future healthcare worry. Medicare Advantage enrollees were more likely to report concerns about not being able to afford their care.
- More employers are offering Medicare Advantage benefits to their retired employees, but some retirees have concerns about prior authorization and costs. Half of employers who offer retirees health benefits do so through Medicare Advantage plans, up from 26 percent in 2017, according to KFF. Just 13 percent of employers with more than 200 employees offer retirees health benefits, but Medicare Advantage is becoming more popular among those who do.
- Medicare Advantage beneficiaries are less likely to be hospitalized for ambulatory care-sensitive conditions than their counterparts in traditional Medicare, but this care is shifted to other settings, a study published in JAMA Health Forum found.
- Initial clinical denial rates rose in 2022, with the highest denial rates coming from Medicare Advantage plans, according to a February report from Crowe Revenue Cycle Analytics.
- In January, CMS implemented tougher audits of Medicare Advantage plans, a change that could leave payers on the hook for billions of dollars in overpayments.The final rule is less strict than previous proposed versions, which would have extrapolated the stricter auditing standards to contracts dating back to 2011. The final rule will only apply to contracts dated from payment year 2018 and up.