Reprinted from MEDICARE ADVANTAGE NEWS, biweekly news and
business strategies about Medicare Advantage plans, product design, marketing,
enrollment, market expansions, CMS audits, and countless federal initiatives in
MA and Medicaid managed care.
By Lauren
Flynn Kelly, Managing Editor
August 4, 2016 Volume 22 Issue 15
As CMS carries out a new policy of reviewing Medicare Advantage
plans’ entire provider networks for adequacy if they request service area
expansions, MAN has learned that plans are dealing with a
stricter-than-ever exceptions process and in some cases are having to drop
legacy counties in order to expand. And the new system puts existing plans in a
tough spot, since the alternative to accepting CMS’s demands is to withdraw
their application altogether and face a two-year lockout from the program.
A spokesperson for CMS declined to provide any estimates of how
many service area reductions plans will make and pointed out that contracts for
2017 have not yet been finalized. But sources say they know of plans that have
been asked to drop certain counties in order to preserve their larger
application. And one source who asked not to be identified says some plans
aren’t getting their expansion requests approved because they came up short on
providers in those areas. While plans used to be able to secure an exception
when the only provider in part of a rural county, for instance, refuses to
contract with MA plans, that rationale no longer passes CMS muster, adds the
source.
“CMS has gotten very demanding about service area network
adequacy, and we hear that they have even rejected some expansions from
well-established, well-respected plans,” weighs in Stephen Wood, a principal
with Clear View Solutions, LLC. “You really have to think twice about going
after new service areas if you have any concerns whatsoever about your current
service area.”
During the current application cycle for 2017, CMS for the first
time began reviewing the adequacy of plans’ entire networks if they requested
service area expansions, whereas CMS historically reviewed the networks of only
new applicants or in new service areas requested by existing plans. This was
largely in response to criticism from the Government Accountability Office and
members of Congress over CMS’s oversight and enforcement of network
requirements for MA plans (MAN
10/1/15, p. 4). And during CMS’s annual audit and enforcement
conference in Baltimore on June 16, Deputy Administrator and Director of the
Center for Medicare Sean Cavanaugh acknowledged that the new process has led to
some confusion and frustration among plan sponsors (MAN
7/7/16, p. 1).
“CMS and [Medicare Advantage organizations] find themselves in a
strange position this year — needing to service area reduce in order to service
area expand,” observes Michael Adelberg, a former top CMS MA official who is
now senior director at FaegreBD Consulting. “It would be interesting to know
how many MA plans have given up counties that they’ve served for many years
without complaints about provider access.”
Sources suggest that part of the problem is the automated system
that CMS began using several years ago that leaves little room for error or
exceptions. CMS relies on mapping software that measures how long it takes to
get to a provider in terms of both time and distance. Those standards are based
on the population size and density parameters of individual counties.
“For example, there’s one county we work with where the eastern
part of the county is very urban, and the western part of the county is really rural,
and this county’s really big,” explains Wood. “So the county’s classified as
urban, but when you get out into the western part, there are no providers out
there. But you have to abide by urban standards, so we’ve taken a run at that
particular county two years in a row and have come up short every time. And it
boils down to one or two holdout doctors, or they just don’t exist.”
For a plan that has long served a particular county, where the
only dermatologist in a “fringe” area retires, thus making it impossible to
meet CMS standards, it’s potentially a big loss to the plan to have to drop a
county, observes Washington, D.C., attorney Mark Joffe. “If a plan’s probably
fairly entrenched and has fairly large enrollment, giving up an existing county
is a pretty big change,” he suggests to MAN. “Moreover, you might
have two or three competitors in the exact same county who have that same issue
and who also don’t have that provider, so the question then becomes what
happens to the other Medicare Advantage organizations, and is this in the best
interest of the program? There are all kinds of implications.”
Joffe says he knows of plans that actually decided not to submit
service area expansions for 2017 in anticipation of this issue. Meanwhile, Wood
says some of his MA clients proactively dropped counties for 2017 even though
their internal analysis showed that they would have had adequate networks, but
the health services delivery tables updated by CMS shortly before the
application deadline indicated a gap.
Physician Shortage Is Impacting Adequacy
A new analysis from America’s Health Insurance Plans (AHIP)
suggests that there may not even be enough physicians in certain states for
plans to meet their federal and/or state network adequacy requirements.
Specifically, AHIP found that 14 states have physician supply rates that are
less than 90% of the national rate, and seven of those states have supply rates
less than 80% of the national rate.
The AHIP data brief, “Impact of Physician Workforce Supply on
Health Care Network Adequacy,” evaluated data on the current geographic
distribution of physicians in four specialties whose services are in increased
demand as a result of the Affordable Care Act and identified states where the
ratio of physicians to population falls below the national average for one or
more of those specialty areas. In Iowa, for example, the
psychiatrist-to-population ratio (5.6 per 100,000) is well below the national
average (8.9 per 100,000), with 64% of counties having no practicing psychiatrists
at all.
Moreover, HHS-designated health professional shortage areas —
which factor into the MA exception process — vary greatly from state to state,
which limits the ability of plans to establish “high-value” provider networks,
points out AHIP. As a result, the report concludes that federal and state
network adequacy standards “should take into account differences in physician
supply and distribution across geographic areas, such as differences in the
number of providers in urban versus rural areas,” and expresses support for the
enhanced use of telemedicine in federal health care programs and the increased
use of nurse practitioners and physician assistants in care delivery.
“Certainly this has become a bigger challenge, and I think it
requires a much broader look into our workforce challenges and solutions to
address that, from workforce education to scope-of-practice laws,” remarks AHIP
spokesperson Clare Krusing. “And I think this is an issue that needs a much
bigger focus, other than pointing to the plans and saying, ‘Your networks
aren’t adequate,’ when the plans are doing everything they can do to meet those
requirements.”
View the AHIP report at http://tinyurl.com/gmqwnyr.
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