Change to private fee-for-service plans
Milliman principal Pat Dunks comments in Medicare Advantage News about an impending change to private fee-for-service plans:
Seeking to begin what is likely to be a major transition process to the end of “deeming” for providers in most private-fee-for-service plans effective Jan. 1, 2011, CMS issued on Jan. 15 a detailed memo with instructions for PFFS contractors. And it strikes what could be a fatal blow against nationwide employer PFFS plans by saying all employer PFFS plans will need a network starting in 2011.
This is a “big deal,” Pat Dunks, a principal and consulting actuary in Milliman’s Milwaukee office, tells AIS. Previously, he explains, the situation was like that in non-employer plans, where a plan sponsor doesn’t need a network in non-network areas. Now, if an employer wants to offer a nationwide product, it must put together a nationwide network, which represents a “pretty high bar,” Dunks says. If it’s doable at all, it will require using either the largest carriers or a combination of products rather than a single product, he adds. Dunks says leased commercial networks aren’t a feasible option for MA since they pay providers much more than is feasible.
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