The Centers for Medicare & Medicaid Services (CMS) released a final rule Monday that takes aim at overpayments and accountability within Medicare Advantage (MA).
Specifically, the rule promises to provide further oversight over MA plans and to recoup any overpayments. CMS plans to do so through the Risk Adjustment Data Validation (RADV) final rule, which will “restore payment oversight,” according to the agency.
“The commonsense policies finalized in the RADV final rule will help CMS ensure that people with Medicare are able to access the benefits and services they need, including in Medicare Advantage, while responsibly protecting the fiscal sustainability of Medicare and aligning CMS’s oversight of the Traditional Medicare and MA programs,” CMS wrote.
CMS will begin extrapolating findings for payment year 2018.
Home health and home care providers have been vying for more MA oversight for years. Though both have made headway in their relationships with certain plans of late, the idea of holding plans more accountable will likely be welcomed news for those providers.
CMS will reportedly ask major health insurers to give back about $4.7 billion in overpayments to start.
The companies with the largest MA shares – Humana (NYSE:HUM), Elevance Health (NYSE:ELV), UnitedHealth Group (NYSE: UNH) and CVS Health’s (NYSE:CVS) Aetna, for instance – were down post-market close Monday.
“For years, federal watchdogs and outside experts have identified the Medicare Advantage program as one of the top management and performance challenges facing HHS, and today we are taking long overdue steps to conduct audits and recoup funds,” Health and Human Services Secretary Xavier Becerra said in a statement. “These steps will make Medicare and the Medicare Advantage program stronger.”
The final rule also comes not long after a proposed rule suggested that CMS would be taking a closer look at MA plans shifting too much care into the home.
“For example, if an MA patient is being discharged from an acute care hospital and the attending physician orders post-acute care at a SNF because the patient requires skilled nursing care on a daily basis in an institutional setting, the MA organization cannot deny coverage for the SNF care and redirect the patient to home health care services unless the patient does not meet the coverage criteria required for SNF care in §§ 409.30-409.36 and proposed §422.101(b) and (c),” that proposed rule stated.
The home health provider LHC Group Inc. (Nasdaq: LHCG) is set to soon become part of UnitedHealth Group’s Optum, barring any further roadblocks. Meanwhile, CenterWell Home Health – another one of the largest home health providers in the country – is a part of Humana.
“It’s not just about the clinics; it’s now about the home and the community,” UnitedHealth Group CEO Andrew Witty said recently at the company’s investor conference.
While more oversight could mean less diversion to the home, it could also mean providers have more leverage at the table with MA plans. MA has generally paid far less for home health care services than traditional Medicare.