Volume 7
Whether you’re an investor, physician, or healthcare executive, it’s impossible to keep up with all the research, policy, information – and misinformation! – that will impact patients and our industry. This newsletter provides actionable intelligence to help payers, investors, practitioners, and thought leaders to solve the big problems in healthcare.
1. COVID This Fall: Plan for the Worst
In the United States, 400 people are still dying every day of COVID-19. Those who are unvaccinated are still at the greatest risk, as are residents in under-resourced communities. Fewer people are wearing masks and getting boosted, which means case rates may spike this fall and winter as Americans head indoors.
So what’s the big deal? While COVID has begun to wane since the peaks of early-to-mid summer, we will likely see the virus peak again into the late fall and winter. With waning immunity and few people boosted, infections, hospitalizations and deaths will rise. With a reduction in funding for COVID mitigation efforts, we will likely see worsening racial disparities.
So what’s next? With an updated COVID booster, anyone eligible should get their vaccines now. Hospital and provider groups need to plan for a rough flu and COVID fall and winter with staffing challenges and strain on the hospital capacity.
2. Government Report Finds Telehealth Fraud Is Rare
Telehealth usage by Medicare recipients has skyrocketed during the pandemic, but fraud is still very rare. The U.S. Department of Health and Human Services Office of the Inspector General flagged just 1,700 of more than 742,000 providers for billing practice issues. Still, fraud cost the government about $128 million.
So what’s the big deal? After reports of rampant fraud with telehealth, many were worried telehealth access could be severely limited. With the findings indicating that Medicare fraud is rare, there is increasing evidence for policymakers that access should be expanded, not limited for Medicare beneficiaries.
So what now?: Congress and CMS will continue to determine what safeguards are needed to mitigate telehealth fraud.
3. UnitedHealth’s Optum Will Help Walmart Expand VALUE-BASED Care
Walmart and UnitedHealth Group have entered a 10-year partnership to extend value-based care models to seniors and Medicare beneficiaries. Under the agreement, the companies also will launch a new Medicare Advantage plan. The initiative will begin in 2023 at Walmart Health locations in Florida and Georgia.
So what’s the big deal? Medicare Advantage plans are increasing in popularity and retailers want to get in on the action. Since Medicare Advantage plans are capitated models, insurers keep the savings when costs are reduced. With UHC partnering with a retailer like Walmart, there’s potential for a rural play and an opportunity to address many social determinants of health (access, food insecurity to name a few).
So what now? The partnership is a relatively small program to start. If it works, we could see broad expansion into this space.
4. MedPAC Exploring Standardized Benefit Options For Medicare Advantage
The Medicare Payment Advisory Commission (MedPAC) is expected to provide recommendations to Congress next year on how standardized benefit options would work for Medicare Advantage (MA). The goal is to streamline beneficiaries’ choices. The move comes after Sen. Ron Wyden (D-OR) launched an investigation into aggressive marketing by MA plans.
So what’s the big deal? As MA plans continue to grow, some plans have very different offerings for seniors – and some of those offerings are not living up to expectations. If MedPAC recommends standardized MA plan offerings, some worry this could stifle innovation and competition.
So what’s next? MedPAC will make recommendations in their annual report. Depending on their advice and if Congress follows, significant changes could be made in how MA plans are administered and what benefits they offer.
5. Dueling Suits: Envision Sues UHC, UHC Sues Envision
Summary: Envision Healthcare is suing UnitedHealthcare for denying payment for ER services. TeamHealth made similar claims in its own lawsuit. Days after Envision, UnitedHealthcare announced its own lawsuit. The insurer alleges it overpaid Envision millions of dollars after Envision exaggerated the complexity of illness and care provided to thousands of ER patients.
So what’s the big deal? Two important things here:
1) Payers will continue to deny payment of claims to force arbitration. In effect, this is a way to lower overall market rates. For provider groups, this means lower reimbursements.
2) Private payers and physician staffing firms will continue to be at war for a long time.
So what now? It depends if you are a payer, patient, investor, or provider. Lawsuits will likely continue between payers and providers as the No Surprises Act is implemented.
6. Aetna/CVS Health Will Sell Affordable Care Act Plans In Four States
On a recent investor call, CVS CEO Karen Lynch announced Aetna will enter Affordable Care Act exchanges in California, Delaware, Illinois, and New Jersey in 2023. Aetna is currently on the ACA exchanges in eight other states. The news comes after Cigna announced it would be entering three new ACA exchanges in 2023.
So what’s the big deal? For patients with Aetna ACA plans, the move brings retail locations and providers closer to the insurance provider. This move may allow patients to manage their health more easily. Conversely, many are concerned about anti-competitive behavior and if cost savings will be transferred to patients.
So what’s next? Like MA plans, ACA plans are a new opportunity for retailer-payers to expand their customer base. Expect to see greater growth in ACA participation by payers who were once reluctant.
7. Physician Groups Tell Congress To Halt Physician Payment Cuts
The American Medical Association, the American Medical Group Association, and the Medical Group Management Association have recommended federal lawmakers extend the three percent temporary increase in the Medicare Physician Payment Schedule. The AMA argued the proposed payment cuts would cause serious disruption to physician practices.
So what’s the big deal? Cuts to Medicare reimbursements paired with inflation costs and labor shortages (and premium labor costs) could have significant revenue implications on physician staffing firms, practices, and hospitals. If revenues fall, some practices, which already are facing significant financial challenges, could shutter causing millions of Americans to lose care.
So what’s next? We will need to see how CMS takes into consideration public comments into their final rule.
8. Judge Rules Employers Can Deny Preventative Care
U.S. District Court Judge Reed O'Connor recently ruled an Affordable Care Act requirement that employers cover HIV prevention medication violates religious freedom protections. Analysts say the ruling could threaten access to sexual and reproductive health care for the more than 150 million working Americans who have employer-sponsored health care plans.
So what’s the big deal? The Court’s ruling allows self-insuring employers to determine what medications or procedures a plan will cover based upon religion. As a result, many of the preventive care provisions that are required by the ACA could be in jeopardy. For more detailed analysis, check out other insights from Kaiser Health News.
So what’s next? This ruling will likely be appealed but the outcome is far from certain. Irrespective of the outcome, other similar suits could follow, jeopardizing many preventative care provisions currently guaranteed to anyone with health insurance.
9. Walgreens Expands Primary Care Footprint
After 11 months, Walgreens completed its majority stake acquisition in at-home care technology platform, CareCentrix. Walgreens now has a 55 percent ownership in the company and hopes the acquisition will address the needs of patients with complex and chronic conditions transitioning out of the hospital.
So what’s the big deal? Another retail giant is expanding their healthcare footprint. Much like CVS, Walgreens wants to control many foundational elements of patient care from preventive and primary care to prescription drugs to post-hospitalization, at-home care. The goal is not only to gain market control, but also to make it more attractive and convenient for patients.
So what now? Unlike CVS, Walgreens has not partnered (or merged) with an insurance giant. We will need to see if that is on the horizon. That said, Walgreens is laying the groundwork for all the foundational pieces of an integrated insurance-provider-pharmacy-retail plan.
10. Minnesota Nurses Strike For Three Days
In what is thought to be the largest private sector nursing strike in U.S. history, 15,000 nurses in Minnesota picketed from Sept. 12-14. The nurses are striking against 13 hospitals in Minneapolis, St. Paul, and Duluth. The union representing the nurses said the professionals are not asking for more pay, but want more flexibility to provide the quality of care they want for their patients.
So what’s the big deal? After two and a half years of an unrelenting pandemic, wide-spread death and illness, inflation costs, and fatigue, the healthcare workforce is demanding better pay, staffing, and hours. Focusing on “wellness” without addressing the drivers of “unwellness” will do little other than make a situation worse. With connected social media networks and widespread frustration, work stoppages are likely to expand over the coming months.
So what now? Healthcare companies must address the challenging working conditions of healthcare workers. Other strikes are likely to follow.
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Have a wonderful rest of the week!
-Dr. N. Adam Brown
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