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This is Scott Becker with the Becker's Healthcare

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podcast.

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I'm joined today by Jacob Emerson, who leads

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the payer coverage at Becker's Healthcare,

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brilliant journalist,

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talks to us really about what issues and

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stories he's watching in the payer world. It's

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been a very busy year in that world.

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Jacob, why why don't you give us a

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sense? What are a couple of the key

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stories that you're following currently?

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Yeah. Hey, Scott. It's great to talk with

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you. So two stories I thought we could

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touch on. The first being some some pretty

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big news,

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exclusive news from the Wall Street Journal,

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today.

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It's July 9 this morning reporting,

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that the justice department,

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has been interviewing

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former employees

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with UnitedHealth Group, former physicians with with the

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company,

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about Medicare Advantage billing fraud. And, you know,

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that's a story we've been talking about for

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a long time, and it's a story that

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goes back a long time. But this really

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indicates to us that the government is,

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that that case involving United is heating up

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and we're finally getting some more information about

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exactly what that might entail, who they're talking

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to, and how the company is responding. So

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that's a really interesting update there. And then

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I also thought we could touch on a

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few,

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key points around the one big beautiful bill.

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I know we we talked about it last

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week in terms of what it's gonna mean

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for Medicaid, for ACA, for for the hospitals,

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and insurance companies in terms of, patient and

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member volumes. But it also, you know, it's

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a it was a massive, budget bill. So

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it included some some interesting changes,

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around employee

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benefits and and HSA changes and things like

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that,

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basically growing those those types of benefits. And

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then we're also starting to see, you know,

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more executives across the industry, CEOs especially in

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insurance, start to comment publicly on the bill

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in terms of whether it's good for their

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company, whether it's,

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bad for their company, or just giving their

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analysis of of what this might bill what

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this bill might look like over the next

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few years.

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Thank you, and certainly. And let's touch first

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on the united story, and then let's talk

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about the bill.

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Sure. What are you seeing there? What what

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are people saying there about the investigation?

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Yeah. So, like I said, this is, The

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Wall Street Journal's exclusive report

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this morning,

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basically saying that

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the

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the the the justice department's health care fraud

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unit has been questioning

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former employees with UnitedHealth

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as part of their wider investigation into the

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company's,

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MA billing practices. And we've talked about that

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investigation.

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We knew,

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I believe it was back in May that

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the journal first reported that the company is

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under criminal investigation for alleged

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Medicare Advantage fraud. That investigation

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reportedly started last year, and

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this, you know, this is the it's the

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upcoding issue that we've heard about for more

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than a decade.

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Basically, that, allegedly, insurers are putting down faults

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or inflated diagnoses on on member

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records so that they get higher higher payments

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from from the government.

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And so according to the journal,

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the the DOJ, the government has been,

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asking former physicians,

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how how this all allegedly

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might have taken place,

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how how they received

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special training

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software that flagged profitable conditions,

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asking about bonuses for physicians who recoded

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patient

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files. And and one of the former doctors

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with the journal, that that the journal talked

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to,

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said that prosecutors were inquiring about pressure from

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the company to use certain diagnoses

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codes, and bonus pay for certain health care

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conditions that then financially favored United. And and

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this all, of course, comes on top of,

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two other DOJ probes into the company's

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billing practices and then potential antitrust

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violations, all alleged,

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between UnitedHealthcare

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and Optum, the two main units

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of the company. And so,

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the journal is reporting that United, in 2021

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alone, received over $8,000,000,000

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for diagnoses that were not supported by actual,

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claims from their members.

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But United, you know, they've as as always,

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they've completely denied this. They stand by the

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integrity of their program.

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They say the journal is, has a has

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a campaign and a predetermined narrative against them,

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and they're relying on incomplete data. So a

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complete denial by United,

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but it's it's some insight into where the

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government is going. And and, you know, these

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doctors aren't making up what they're telling the

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journal. So, it's a really interesting

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revelation to this week.

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No. It it's fascinating. In in United also,

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didn't they sue a different newspaper reporting on

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something related to this, or is that a

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different story? They they did. It's, you know,

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another,

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part of this Medicare Advantage conversation that there

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was, that they were allegedly either denying,

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post acute care discharges

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in in nursing homes,

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or and they're allegedly paying nursing homes to,

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steer their members to their Medicare Advantage Plans.

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And that was reported on by The Guardian

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based off a lot of document reviews according

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to them and a lot of interviews,

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and that's, you know, the British newspaper, and

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then United has called that defamation and is

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currently suing,

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The Guardian over that report, which, is completely

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separate from from what we're talking about

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today with The Wall Street Journal. So just

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a lot to keep up with this company

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and with this topic.

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No. Fascinating. And United, of course, is the

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third or fourth largest company in The United

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States by revenues. It's a big, big company.

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$8,000,000,000

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out of their 400,000,000,000

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or so,

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more than 60,000,000,000.

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A serious number, particularly with 8,000,000,000 in codes

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that are is is it is that per

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year or is that in total 8,000,000,000 in

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codes?

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Yeah. According to the journal, they're saying they

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received $8,000,000,000

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in overpayments,

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in 2021

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alone.

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Got it. So that's one Got it. Yeah.

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Yeah. So so not insignificant.

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Well, very No. Very, very interesting.

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And so that's what's going on with United

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and and too early to really understand or

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speculate with what this means economically to the

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company

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and what it means to their caution going

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forward and how they built the Medicare Advantage

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program because, presumably,

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this will lead to a different level of

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caution in terms of how things are coded

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and so forth. Just fascinating.

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And then And what I think what I

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think is really interesting too, Scott, is, you

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know, this is it's obviously it's a Republican

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administration,

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that is investigating this company. And on the

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flip side, we're seeing in Minnesota,

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with a Democratic governor,

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there was a bill passed recently that bans,

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for profit insurers from participating in the state's

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Medicaid program. Well, Minnesota is United Health's backyard,

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and they are no longer allowed to administer

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Medicaid in the state of Minnesota

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run by by a Democratic

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governor. So

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what's this you know, the the national context

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is telling us is that both sides of

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the aisle are are going after this company,

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either legislatively

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or or, you know, with these investigations,

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which I just think is, you know, fascinating

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context given everything we've heard and read about

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United over the last year or two.

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Well, it it sure is fascinating, but it

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also it there's also another piece of it

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that even though the administration is going after

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them to the Department of Justice, there's also

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this other side of it where they're increasing

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rates for Medicare Advantage,

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which, of course, the Medicare Advantage houses find

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that to be a a very positive thing.

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So you've got a couple different pieces here

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as well.

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We're we're so that just is absolutely fascinating.

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And so we'll see how it plays out,

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but it but it does speak to the

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fact you've got Democratic politicians, Republican politicians

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taking shots at the big insurance companies.

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It does speak to the to the populist

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mood of anti insurance companies at the moment.

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And so, you know,

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there there certainly is that mood and the

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both parties tap into that mood even though

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on one hand, Republicans tap into it, but

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then are giving the Medicare Advantage companies raises

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on the other hand too. So really, really

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fascinating.

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Yeah. Nuance conversation for sure.

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Very much so.

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But I yeah. The other thing I wanna

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talk with you about in terms of nuanced

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conversations is is the one big beautiful bill

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act, which as everyone listening, I'm sure knows

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passed on on July 4 signed by president

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Trump. And, you know, you and I talked

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about, like I mentioned in the start, we

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talked about what the hospitals have been saying,

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what the insurers have been saying. You know,

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they're they're very concerned about loss of patient

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volumes, loss reimbursements, and and what that's gonna

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mean for their very tight margins.

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But I I came across, you know, today

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this interesting post on LinkedIn from a a

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a staff vice president at at Ellevance, which,

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you know, one of the largest health insurance

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companies in the world,

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and and staff vice president is a very

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high up position at that company.

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Basically, talking about how he does not see

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this bill as as reckless,

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certainly an uncomfortable conversation,

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in terms of what it's leading to. But

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to quote him, he basically said Medicaid has

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been scaling and growing larger for years without

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stabilizing,

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that it's you know, there's a trillion dollars

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a year in this system. And yet even

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before the big beautiful bill, there were still

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rural health care closures, provider shortages,

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behavioral health network issues,

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basically pointing to the fact that that that

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there's he's saying that there's not a funding

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issue, that this is a wider system issue,

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and that the the legislation, it doesn't repeal

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the ACA.

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It doesn't dismantle Medicaid.

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According to him, what it does is it

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forces a harder conversation around who qualifies under

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what terms,

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and whether it's the dollars flowing to the

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actual care or whether it's maintaining the architecture

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that no longer works. And he and he

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also argues that work requirements, that they're not

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new. We we've seen them, talked about federally

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before. We've seen a few states, try them

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or implement them. Not too much success, but

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we have seen it before. So it's just

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interesting that we are starting to see some

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insurance executives

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publicly,

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having

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not pro conversations about this legislation, but just

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different

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compared to even last week what we talked

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about, which is other insurance CEOs talking about

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the loss of Medicaid members and and, you

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know, the difficulties that that's gonna present for

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them over the next couple years. So it

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just seems that there's people these executives are

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a little bit all over the map right

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now in terms of how they think this

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this legislation is gonna shake out. And then

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I had a few other things, in terms

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of the HSA changes, Scott, but I'll, in

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term yeah. I'll I'll pass it back to

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you.

293
00:10:38,809 --> 00:10:41,529
Yeah. No. It's it's incredibly complicated because the

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the reality is there is so much money

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floating through the system

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that people have a very hard time understanding

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what's real, what's needed, what's wasted, what's not.

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And at the same time, the flip side

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is if you're a fiscal conservative,

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you you sort of feel like, well, if

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you're gonna cut cost,

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then we ought to also cut deficits. And

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I think one of the most frustrating thing

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to fiscal conservatives is the concept that we're

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cutting costs in certain places,

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but the deficits continue to rise. So it's

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it's it's very it's I I think there's

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I think the insurance executives thoughts from Elevant,

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there there's a lot that's right there that

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people are just very concerned about overall

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the spend in the government.

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At the same time, there there's also tremendous

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concern that the government just keeps on riding

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up and increasing the deficit. So and and

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then there's also this concern too

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that this is one of the things that

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politicians do all the time, but it's so,

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unpleasant

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is the the

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positives, meaning the tax cuts happen immediately,

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but the benefits cuts happen over time.

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And so Right. In in the immediate future,

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a lot of people might might not feel

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those negatives to the benefits,

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but you end up in a situation where

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even though they don't feel the benefits they

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they don't see the negatives, they're coming over

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time. And that's quite confusing to people too.

329
00:12:06,740 --> 00:12:08,740
Definitely. Definitely. Especially, yeah, when it comes to

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Medicaid, that's definitely true. You know, this is

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gonna be a long term issue,

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and it won't necessarily be tied to the

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Republicans, but I I guess we'll see. But

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one thing I think too, you know, this

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bill did not extend the ACA premium tax

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credits, and there's still time to do that,

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but it's, you know, the the the winds

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are pointing that that probably will not occur.

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At least that's what we're hearing. And, you

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know, they just have to lock in those

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rates. But that's a very interesting point because

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what happens is in in the prior Trump

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administration,

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he, at one point, tried to gut the

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ACA

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directly.

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And and I think, notwithstanding what the elephants

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executive says, I think many people feel like

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this is an indirect

350
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gutting of the ACA

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here

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because of those subsidies, because of those rates,

353
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because of those kinds of issues that those

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are gonna go away. So even though you

355
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didn't directly

356
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abolish the ACA or get rid of the

357
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ACA,

358
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you, for all practical purposes, have taken very,

359
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very strong

360
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strides at reducing it very, very significantly.

361
00:13:12,879 --> 00:13:14,799
Yeah. Definitely. I mean and I think the

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00:13:14,799 --> 00:13:16,399
core of the issue there is that the

363
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the subsidies are around because the ACA coverage

364
00:13:19,154 --> 00:13:20,695
is just so expensive.

365
00:13:21,795 --> 00:13:24,035
So that's, you know, a core problem there.

366
00:13:24,035 --> 00:13:26,355
But in terms of, you know, very short

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00:13:26,355 --> 00:13:28,514
term effects, insurers have to lock in their

368
00:13:28,514 --> 00:13:31,154
their ACA rates for for next year, this

369
00:13:31,154 --> 00:13:33,840
summer, but very soon. And, you know, they're

370
00:13:33,840 --> 00:13:35,679
currently from what we're hearing, they're developing two

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00:13:35,679 --> 00:13:37,840
sets of rates. One, you know, with the

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00:13:37,840 --> 00:13:40,399
ACA if the premium subsidies are extended or

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not, so two different rates there. But if

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the if it's not extended and we'll know

375
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pretty soon, and those late rates are locked

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00:13:47,054 --> 00:13:49,054
in, will those go into effect next year?

377
00:13:49,054 --> 00:13:50,674
So people, you know, buying,

378
00:13:51,535 --> 00:13:53,774
ACA coverage, a good chunk, especially low and

379
00:13:53,774 --> 00:13:56,014
middle income people, they'll they'll feel that effect

380
00:13:56,014 --> 00:13:57,934
pretty quickly because these rates, from what we're

381
00:13:57,934 --> 00:13:58,980
seeing, they're double digit

382
00:13:59,379 --> 00:14:01,539
requests all over the country in every state.

383
00:14:01,539 --> 00:14:03,940
So that'll be pretty quick in terms of

384
00:14:03,940 --> 00:14:04,659
what's being,

385
00:14:05,220 --> 00:14:08,039
more tied federally versus this bill specifically.

386
00:14:08,419 --> 00:14:10,019
But one thing I did wanna mention, Scott,

387
00:14:10,019 --> 00:14:12,100
in terms of, you know, what concretely has

388
00:14:12,100 --> 00:14:14,100
been passed because of this it was included

389
00:14:14,100 --> 00:14:16,315
in this bill is that congress has and

390
00:14:16,315 --> 00:14:17,855
what we it's been called a unicorn,

391
00:14:18,475 --> 00:14:20,014
piece by some executives,

392
00:14:20,475 --> 00:14:22,715
speaking to us, is that congress has permanently

393
00:14:22,715 --> 00:14:24,955
extended a rule that allows people with high

394
00:14:24,955 --> 00:14:27,615
deductible plans linked to their, HSAs,

395
00:14:28,480 --> 00:14:31,379
to access telehealth services without having to meet

396
00:14:31,440 --> 00:14:33,759
their deductible first. So that was, you know,

397
00:14:33,759 --> 00:14:35,679
that was existed back in COVID, but now

398
00:14:35,679 --> 00:14:36,420
it's permanently

399
00:14:36,960 --> 00:14:37,460
extended,

400
00:14:37,920 --> 00:14:40,399
so that you can have covered telehealth and

401
00:14:40,399 --> 00:14:41,299
digital services

402
00:14:41,634 --> 00:14:43,634
at little to no out of pocket cost

403
00:14:43,634 --> 00:14:45,875
while still being able to contribute to your

404
00:14:45,875 --> 00:14:47,815
HSA. So that's a big change,

405
00:14:48,434 --> 00:14:50,615
that we've heard people are, you know, definitely

406
00:14:50,754 --> 00:14:51,894
talking about a lot.

407
00:14:52,274 --> 00:14:54,274
Next year, people enrolled in the bronze and

408
00:14:54,274 --> 00:14:57,190
catastrophic ACA plans can are eligible to contribute

409
00:14:57,190 --> 00:14:58,170
to HSA's,

410
00:14:59,029 --> 00:15:02,090
direct primary care arrangements are now HSA eligible.

411
00:15:03,029 --> 00:15:04,330
So there were some interesting

412
00:15:04,710 --> 00:15:07,110
employee benefits changes included in this bill that

413
00:15:07,110 --> 00:15:08,870
we've also heard a lot of conversations about,

414
00:15:09,190 --> 00:15:11,684
among our audience too. It it is fascinating.

415
00:15:11,904 --> 00:15:14,544
And what is fascinating behind all of this

416
00:15:14,544 --> 00:15:17,044
stuff is to understand a little bit

417
00:15:17,424 --> 00:15:20,225
all the lobbying that goes into these different

418
00:15:20,225 --> 00:15:21,524
very specific provisions

419
00:15:22,065 --> 00:15:24,384
and who drives them, who's behind them, who

420
00:15:24,384 --> 00:15:26,709
pushes for them. Because I don't imagine that

421
00:15:26,709 --> 00:15:27,690
too many congressmen

422
00:15:28,789 --> 00:15:31,429
or women or senators are sitting at midnight

423
00:15:31,429 --> 00:15:33,429
thinking about the very specific details of some

424
00:15:33,429 --> 00:15:35,029
of this stuff. I assume that a lot

425
00:15:35,029 --> 00:15:36,709
of it is fed to them by people

426
00:15:36,709 --> 00:15:39,269
that have a vested interest in one position

427
00:15:39,269 --> 00:15:40,009
or another.

428
00:15:40,745 --> 00:15:42,504
Yeah. No. It's I I totally agree, and

429
00:15:42,504 --> 00:15:44,924
it's fascinating that you could probably trace single

430
00:15:44,985 --> 00:15:47,164
lines of these bills back to certain

431
00:15:47,544 --> 00:15:49,084
trade groups or or stakeholders.

432
00:15:49,704 --> 00:15:51,384
And I guess in that vein, we didn't

433
00:15:51,384 --> 00:15:54,424
see some, some codification of ICRA, those those

434
00:15:54,424 --> 00:15:54,924
alternative

435
00:15:55,259 --> 00:15:57,740
health insurance arrangements with employers. Those were removed

436
00:15:57,740 --> 00:15:59,179
from the bill, and that would have codified

437
00:15:59,179 --> 00:16:01,580
the tax credit nationally versus where it's currently

438
00:16:01,580 --> 00:16:03,360
on a state by state basis.

439
00:16:04,139 --> 00:16:06,620
So clearly, the ICRA industry didn't have enough

440
00:16:06,620 --> 00:16:08,000
voice in this, but,

441
00:16:08,304 --> 00:16:10,225
you know, HSAs did. So it's it's just

442
00:16:10,225 --> 00:16:11,825
very interesting as you go through this line

443
00:16:11,825 --> 00:16:13,264
by line and figure out what made it

444
00:16:13,264 --> 00:16:15,825
and what didn't. It it it that really

445
00:16:15,825 --> 00:16:16,325
is.

446
00:16:16,705 --> 00:16:18,785
Jacob, always a pleasure to visit with you.

447
00:16:18,785 --> 00:16:20,384
I always learn so much. I hope our

448
00:16:20,384 --> 00:16:22,446
audience does too. Thank you so much for

449
00:16:22,446 --> 00:16:24,706
joining us today on the Becker's Healthcare Podcast.

450
00:16:24,766 --> 00:16:27,506
Thank you very, very much. Thank you, Scott.