What 6 payers said about CMS' Medicare Advantage auditing crackdown 

Payer executives are still taking stock of tougher Medicare Advantage auditing standards CMS unveiled Jan. 31.  

On fourth-quarter earnings calls, executives told their investors they are evaluating next steps and awaiting more information from CMS. 

Leaders said they were pleased CMS decided not to extrapolate the new rules to contracts prior to 2018 but expressed disappointment the agency eliminated the fee-for-services adjuster, which allows a permissible number of payment errors. 

Industry leaders had signaled prior to the announcement they were likely to sue over the lack of a FFS adjuster. 

Here is what executives had to say about the tougher auditing standards: 

1. Tim Noel, CEO of Medicare and retirement for UnitedHealth Group, on a Jan. 13 earnings call ahead of the ruling, told investors he did not want to speculate on impacts but said risk adjustment is important for providing equitable access in Medicare Advantage and ensuring plans are not disincentivized from caring for the most vulnerable. 

"A few of the key elements that we're thinking about with respect to these audits is it's very important for CMS to include a fee-for-service adjuster to make sure that we're comparing original Medicare and Medicare Advantage on the same basis," Mr. Noel said. 

2. Humana CEO Bruce Broussard told investors on a Feb. 1 call the company is considering all its options in response to the elimination of the fee-for-service adjuster. 

3. Susan Diamond, Humana's CFO, said the fact that the tougher audits will not be applied prior to 2018 is "definitely positive." 

"At this time, that's really all we can say," Ms. Diamond said. "There's going to have to be additional collaboration with CMS to better understand some of the go-forward activity, and we'll continue to evaluate all of our options to address the primary issue of the lack of acknowledgement of the need for a fee for-service-adjuster." 

4. Cigna CEO David Cordani said the company is awaiting further information from CMS on the specifics of how the new risk adjustment standards will be applied. 

"We're pleased the team has concluded that they're not going to extrapolate their actions prior to 2018. We're concerned that we continue to question a couple of decisions, for example, the elimination of the fee-for-service adjuster that we deem to be foundational to the program," Mr. Cordani said on a Feb. 3 call. "And we await specifics relative to the methodology that is going to be used in some aspects of the extrapolation and work … to get further clarity relative to the open items that are here." 

5. Centene CEO Sarah London said in regard to the risk adjustment data validation changes, the company is "working in collaboration with our industry partners to determine the best path forward." 

"Regarding the finalization of the RADV rule, we are supportive of CMS' decision to limit the scope of historical audits. CMS' decision in this regard avoids significant cost and abrasion for our provider partners," Ms. London told investors on a Feb. 7 earnings call. 

"That said, the lack of fee-for-service adjustment and the as yet undefined sampling and extrapolation methodology leaves a number of open questions as to the viability of the final approach," she continued. 

6. Shawn Guertin, CFO at CVS Health, said many questions are still unanswered about the effect of the RADV changes and proposed Medicare Advantage rate changes in 2024. 

Mr. Guertin told investors on a Feb. 8 call the changes from CMS prove the value of "high quality Medicare Advantage value-based care assets," referring to the company's recent agreements to acquire providers Oak Street Health and Signify Health. 

"As we think about navigating the future of Medicare Advantage and maybe even a broader opportunity in Medicare value-based care in the fee-for-service population, I think both Signify [Health] and Oak [Street Health] are exactly the kind of assets that you would like to have at your side as you do that." 

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