Tag Archives: Rob Pipich

How will the pandemic impact Medicare Advantage revenue and risk scores in 2021?

While there is a great deal of focus on resource availability and handling a potential influx of severe inpatient cases resulting from COVID-19 infections, the majority of the United States saw a dramatic reduction in healthcare services around March and April 2020 and measurable reductions continue with great variation across the nation. 

As with many prospective risk adjustment models, Medicare Advantage (MA) and Part D (PD) risk scores are based on medical claims, more specifically diagnoses from face-to-face visits from the year prior to the year in which the risk score drives revenue. For 2021 MA payments, 2020 diagnoses are the basis of the final risk scores. To the extent that beneficiaries delay or avoid care, there may be fewer face-to-face encounters with providers where diagnoses can be recorded and applied toward 2021 risk scores.  

While the Centers for Medicare and Medicaid Services has announced additional flexibilities in including telehealth-based diagnoses in risk score calculations, a significant reduction in overall services is likely to result in a material reduction in both MA and PD risk scores. In this article, Milliman’s Rob PipichKarin Cross, and Deana Bell discuss the results of an analysis they performed to support 2021 MA and PD bids. They present nine scenarios intended to illustrate a range of potential outcomes on 2021 MA and PD risk scores. 

How may social distancing affect Medicare Advantage organizations?

The COVID-19 pandemic has brought unprecedented stress and challenges to the healthcare industry. Based on the nature of the Medicare Advantage program and the predominantly elderly population it serves, Medicare Advantage organizations (MAOs) in particular face unique challenges. Beginning in early 2020, parts of the country implemented social distancing, with periods of closures or reduced capacity for many healthcare professional offices and postponement of nonurgent procedures at hospitals. Due to greater susceptibility, seniors may continue social distancing for more time and may be more hesitant to continue with normal social interactions, including receiving routine healthcare services.

In this article, Milliman’s David Koenig, Rob Pipich, and Michael Polakowski explain why MAOs need to be aware of the possible implications of these realities on their business and why they should address any issues now.

Milliman risk score trend analysis consistent with Advanced Notice

The 2.1% Medicare fee-for-service (FFS) 2016 medical risk score trend was the primary driver behind the increase in the Part C FFS normalization factor proposed in the 2018 Advance Notice.

Milliman’s Darcy Allen, Karin Cross, and Robert Pipich conducted a risk score trend analysis, which is consistent with the trend in the Advance Notice. They also identified the six Hierarchical Condition Category (HCC) contributors shown in Figure 2 as the key drivers of the 2016 risk score trend. For more perspective, read their article “What’s driving the high risk score trend in the 2018 Advance Notice?




What are the advantages of Medicare Medical Savings Accounts?

Medicare Medical Savings Accounts (MSAs) have gained some traction in recent years, and may become an attractive alternative to traditional Medicare Advantage (MA) plans. Insurers that offer these products can potentially increase their market share by capturing new working-age beneficiaries. In this article, Milliman’s Rob Pipich and Ruokai Chen highlight some key information regarding MSA plan benefits and provide an example of how such a plan works. They also provide a comparison of a Medicare MSA plan and MA plan.




The ACA Cadillac tax: A primer for employers

The Patient Protection and Affordable Care Act (ACA) excise tax on high-cost insurance plans, known as the “Cadillac tax,” is a narrowly targeted source of funding that the Congressional Budget Office (CBO) has projected to be a significant source of revenue. The calculations involved in projecting the future burden of the Cadillac tax are complex and will become a necessary part of human resources benefit planning, union negotiations, and other postemployment benefit (OPEB) valuations. Milliman consultants Rob Pipich and Chris Ruff provide some perspective in this article.




High-deductible/health savings account plans continue to increase

According to a survey by Americas Health insurance Plans (AHIP) the number of individuals insured by high-deductible health plans (HDHPs) in conjunction with health savings accounts (HSAs) grew 18.4% this year to 13.5 million from 11.4 million in 2011. AHIP data shows that this type of consumer-driven health plan (CDHP) has increased gradually since it was introduced in 2004. Read more about AHIP’s survey at Workforce.com. You can also read the entire survey here.

One question arises from the aforementioned survey: Do CDHPs help reduce costs? Jack Burke and Rob Pipich’s detailed analysis on high-deductible plans found that when adjustments are made for typical risk and benefit factors, CDHPs deliver cost savings that are modestly better than non-CDHPs. Here is an excerpt:

“Most employers we examined showed savings in the CDHP plan before adjusting for risk and plan design characteristics; however, the bulk of the apparent savings was explained by these adjustments. After adjustments, the reduction in combined employer and employee costs averaged 4.8% before accounting for the utilization-dampening impact of the high deductible. Accounting for the high deductible made the reduction 1.5%. Some employers showed significantly greater reductions.”

This 1.5% reduction is what’s known as “induced utilization” and is a key element of CDHPs. For more, read Milliman’s complete Consumer-Driven Impact Study.