In 2011, the Centers for Medicare and Medicaid Services (CMS)
established the Medicare Shared Savings Program (MSSP) and brought the concept
of the accountable care organization (ACO) to a wider audience. A key feature
of the MSSP methodology is the minimum savings rate (MSR) and minimum loss rate
(MLR). ACOs that participate in the MSSP are familiar with these corridors
because they can mean the difference between receiving shared savings and
receiving nothing. On the other hand, for ACOs currently taking downside risk,
the MLR provides a buffer that neutralizes potential losses.
In this paper, Milliman’s Charlie Mills and Chris Smith explore the MSR/MLR options available to ACOs and provide perspective on what ACOs should consider when selecting the MSR/MLR under an MSSP track with a downside risk.
On January 30, the Centers for Medicare and Medicaid
Services (CMS) introduced guidance describing the new Healthy Adult Opportunity
(HAO) 1115 waiver option. This option outlines conditions under which a state
might convert open-ended matching funding for expansion adults into a block
grant or per capita program.
The HAO offers states new flexibilities for their Medicaid
programs in return for assuming the financial risk of block grants. State
program directors face many complex considerations as they evaluate these
options. While the HAO will clearly appeal to states that have previously
considered requesting a block grant, the range of policy options made available
under this initiative may bear considerations for states across the country.
In this paper, Milliman’s consultants discuss 10 key considerations for states evaluating the HAO.
At the end of 2018, the Centers for Medicare and Medicaid
Services published the Pathways to Success final rule for the Medicare Shared
Savings Program (MSSP) giving accountable care organizations (ACOs) renewing
July 1, 2019, or later the option to select between prospective and
retrospective assignment of patients.
Under prospective assignment, beneficiaries are assigned to
an ACO based on services occurring prior to the performance year. Under
retrospective assignment, beneficiaries are assigned to an ACO based on
services occurring during the performance year. Averages for
assignment-eligible fee-for-service beneficiaries can help provide understanding
of how the two assignment methodologies affect results.
Retrospective and prospective assignment have significantly
different effects on the characteristics of the assigned populations for
beneficiaries assigned to primary care physicians and specialists. Prospective
and retrospective assignment will ultimately affect the population that is
assigned to the ACO because some beneficiaries who are assigned under
prospective assignment are not assigned under retrospective and vice versa. The
choice between these assignment methodologies can have subtle effects on the
ACO’s overall benchmark, risk score, and performance year costs.
In this brief, Milliman’s Sam Shellabarger, Charlie Mills, and Lance Anderson explore in more detail the potential effects of prospective and retrospective assignment on key ACO metrics under the MSSP.
In November 2019, the Centers for Medicare and Medicaid
Services (CMS) released a final rule establishing requirements for hospitals
operating in the United States to establish, update, and make public a list of
their standard charges for items and services they provide. The provisions of
the final rule go into effect on January 1, 2021.
The lack of price transparency in the U.S. healthcare market is well known. There are several reasons that can make estimating costs before care difficult for consumers. One of the main challenges is the variation in billed charges and negotiated rates between insurance companies and providers. The majority of Americans have health insurance coverage through insurance companies (or payers), which negotiate prices with hospitals and providers. The negotiated prices between payers and providers have historically been confidential and subject to nondisclosure agreements.
Health economists and other experts believe that
transparency in pricing is key to healthcare cost containment. Opponents of the
policies adopted in the CMS final rule say that these requirements will impose
a significant burden on hospitals and may lead to confusion without providing
any relevant information.
In this paper, Milliman actuaries and consultants provide a summary of key provisions of the final rule that apply to hospitals, briefly touching on topics that require additional consideration by parties affected by the rule.
beneficiaries with ESRD are not allowed to enroll in MA plans except in limited
situations such as enrolling in an ESRD special needs plan or remaining on the
MA plan providing coverage prior to being diagnosed with ESRD. This results in
a higher proportion of ESRD individuals receiving coverage through traditional
Medicare (59%) relative to Medicare Advantage (14%).
starting in 2021, the distribution of ESRD individuals by coverage type may
change. Section 17006 of the 21st Century Cures Act allows
Medicare-eligible individuals with ESRD to enroll in MA plans as of January 1,
2021. This change in MA eligibility could shift a portion of ESRD individuals
currently covered by traditional Medicare to an MA plan.
MAOs could experience significant impacts to their overall financial results as the behavior, claim costs, and revenue payments for ESRD beneficiaries can vary greatly from non-ESRD beneficiaries. ESRD beneficiaries make up only 1% of Medicare enrollment and account for 7% of Medicare fee-for-service costs.
In this paper, Milliman consultants provide an overview of the upcoming ESRD MA eligibility change and key questions each MAO should consider when planning for 2021.
The Medicaid Fiscal Accountability Regulation (MFAR) rule proposed by the Centers for Medicare and Medicaid Services (CMS) aims to increase transparency of Medicaid supplemental payments and address concerns over their financing. The proposed rule defines supplemental payments as “extra compensation to certain providers” that are often made to providers on a lump sum basis apart from claim-based payments. If the proposed rule is implemented, many states may need to revise their Medicaid supplemental payment programs to achieve compliance. This paper by Milliman’s Ben Mori, Tyler Schulze, and Jason Clarkson summarizes the key proposed changes under MFAR for state Medicaid agencies to consider.