Health Data Decisions (HDD) has conducted an in-depth analysis of the Final CMS 2025 Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies (the Rate Announcement). This analysis highlights the substantial implications for Medicare Advantage (MA) plans and the importance of partnering with experts who employ specialized services and solutions in addressing these challenges.
The announced MA rate increase is below expectations, leading to a noticeable decline in the stock prices of major payers such as Humana, Centene, UnitedHealth, and CVS Health, as reported by Reuters on AOL (https://www.aol.com/news/us-health-insurers-slide-final-095047596.html). This development underscores the necessity for complete and accurate data submission to CMS and emphasizes the need for plans to adopt a proactive approach to mitigate the financial challenges and downstream impact to their members. In this context, the strategic application of specialized data analytics is crucial.
- Revenue Increase for MA Plans: The 3.7% increase in revenue for Medicare Advantage (MA) was less than the market anticipated and could lead to changes in premiums and benefits heading into this year's bid cycle. This further highlights the essential need for maintaining thorough documentation under v28 of the risk adjustment model and proactively engaging members to fill gaps in care to drive Star measure improvement. This underscores the importance of having advanced proactive analytics and strategic SMEs which help ensure accurate and comprehensive documentation. Reactive analytics will no longer move the needle.
- Risk Model Changes: The increased weighting of the v28 model on member Part C risk scores necessitates precise clinical documentation and verification of member status. This shift aligns with the ongoing phase-in of risk model changes, with member Part C risk scores calculated based on 67% from the v28 model (CMS-HCC 2024) and 33% from version 24 (v24, CMS-HCC 2020). Accurate alignment of coding practices with the v28 model requirements and advanced data infrastructure are essential to ensure precise risk score calculations and maintain compliance with evolving regulatory standards.
- Part D Model Update: The updated Part D model, incorporating changes from the Inflation Reduction Act, necessitates a comprehensive understanding of Part D payments and member out-of-pocket (OOP) expenses. The modifications include the elimination of the coverage gap, a reduction in the OOP threshold to $2,000, and increased OOP payment flexibility for members. The Medicare Prescription Plan Payment (M3P), effective January 1, 2025, allows members to spread their OOP prescription costs in monthly amounts throughout the plan year, subject to maximum monthly caps. It is essential for plans to educate members, enrollment staff, pharmacy benefit managers (PBM) and pharmacy partners about these new payment options. Understanding and communicating these changes are crucial for a smooth transition for enrollees and for managing the potential impact on Star Ratings, particularly regarding medication adherence measures.
- Future Stars Model Changes: HDD highlights the significance of the "Universal Foundation" measures in influencing the forthcoming modifications to the Stars model. It is essential for payors to have access to experts with insights and tools that enable them to anticipate and respond effectively to these changes. By leveraging expertise in this area, payers can proactively adapt to evolving metrics, maintaining high Star Ratings, and ensuring the delivery of high-quality healthcare outcomes. For more information on the Universal Foundation, please visit https://lnkd.in/ejbUe7QM.
- MA Enrollment Expansion: There are opportunities for Medicare Advantage (MA) enrollment growth in rural areas and smaller counties. It is crucial to engage and provide services to these underserved populations and ensure network adequacy. Sophisticated tools can enable payors to precisely identify and adequately meet the healthcare needs of these communities. By extending coverage, payers can ensure that quality healthcare is accessible to everyone, thereby contributing to a more equitable healthcare environment.
In response to the ever-changing regulatory landscape, HDD offers thought leadership and hands-on data analytics in response to the Rate Announcement, emphasizing the imperative for payors to harness their data effectively now. Health Data Decisions provides a suite of offerings, including Prospective Clinical Workflows, MA Risk Score Verification Tool, and our OIG Audit Exposure Accelerator which are designed to equip payors with the precision tools and insights necessary for navigating these shifts. By integrating HDD's innovative consulting and analytic services and solutions, payors can significantly enhance their operational efficiency and performance, securing a competitive advantage.