CMS finalized its Medicare Advantage rates for 2024, and the final rule includes a slew of changes in coding and risk adjustment rates.
The biggest changes will be phased in over three years, but payers can begin examining the impact to their health plans now.
Gen Gillespie, chief revenue officer at Belong Health, told Becker's not every health plan has processed the impact this ruling will have yet.
"A lot of the small, local health plans are really, largely unaware that this will be happening, which is another unfortunate consequence," Mr. Gillespie said. "I think the larger carriers are more prepared to absorb this impact than the local health plans."
Assess local impacts
The impact of the rule varies widely across geography, plan type and other factors.
An analysis from Avalere, funded by the Better Medicare Alliance, found the proposed rule would decrease rebates in Houston by 63 percent under CMS' proposed rule.
In Los Angeles, this decrease would be 19 percent.
Melissa James, a senior health language consultant at Wolters Kluwer, told Becker's the impact of the removed Hierarchical Condition Categories codes varies based on disease prevalence in different areas of the country.
"For example, diabetes, or congestive heart failure, those are very prevalent in the Southern United States," Ms. James said. "So that case mix is going to be disproportionately affected than other geographical areas in the United States because of those proposed payment changes."
Plans need to assess the specific impact of the changes based on their membership profile, Mr. Gillespie said.
"They're going to look at a product-by-product, county-by-county, even member-by-member lens, and practice-by-practices," Mr. Gillespie said. "This is an attribution based program, so providers are going to be disproportionately impacted as well within their network, based on the coding intensity and disease burden of their membership."
Leverage data
Health plans can't control CMS rulemaking, but they can control how they react to it, Ms. James said.
"Leveraging technology is going to be key, more so than [plans] already do, to not only ensure that the most accurate, highest-specific codes are being captured, and that they're clinically supported," Ms. James said.
Plans should also rely on advanced analytics to predict population health, predict costs and identify areas of risk, she said.
Kate Eshelman, MD, vice president of clinical informatics at Inovalon, told Becker's plans need to be ready to make sure coding is accurate and good internal auditing procedures are in place.
"What CMS is signaling to payers is that they're tightening the diagnoses that are risk adjustable, and they're increasing their risk surveillance and their auditing, which has already been announced in the RADV ruling," Dr. Eshelman said.
Invest more in compliance
Ms. James said 2023 is "the year of compliance."
"There's a really big need for health plans, as a whole, to have a solid compliance program in place," Ms. James said.
That includes having expert coders and auditors to navigate changes and investing in education for providers and coders, Ms. James said.
Dr. Eshelman said it is important for payers to step up the amount of internal auditing of their Medicare Advantage plans.
"There are ways to look for conditions that providers might have documented in error and have a really good program in place to ensure that no codes that are being documented in error are being submitted on to CMS," Dr. Eshelman said.