Speaker 0: This is Scott Becker with the Becker's Healthcare podcast. I'm joined today by Jacob Emerson, who leads the payer coverage at Becker's Healthcare, brilliant journalist, talks to us really about what issues and stories he's watching in the payer world. It's been a very busy year in that world. Jacob, why why don't you give us a sense? What are a couple of the key stories that you're following currently?

Speaker 1: Yeah. Hey, Scott. It's great to talk with you. So two stories I thought we could touch on. The first being some some pretty big news, exclusive news from the Wall Street Journal, today.

It's July 9 this morning reporting, that the justice department, has been interviewing former employees with UnitedHealth Group, former physicians with with the company, about Medicare Advantage billing fraud. And, you know, that's a story we've been talking about for a long time, and it's a story that goes back a long time. But this really indicates to us that the government is, that that case involving United is heating up and we're finally getting some more information about exactly what that might entail, who they're talking to, and how the company is responding. So that's a really interesting update there. And then I also thought we could touch on a few, key points around the one big beautiful bill.

I know we we talked about it last week in terms of what it's gonna mean for Medicaid, for ACA, for for the hospitals, and insurance companies in terms of, patient and member volumes. But it also, you know, it's a it was a massive, budget bill. So it included some some interesting changes, around employee benefits and and HSA changes and things like that, basically growing those those types of benefits. And then we're also starting to see, you know, more executives across the industry, CEOs especially in insurance, start to comment publicly on the bill in terms of whether it's good for their company, whether it's, bad for their company, or just giving their analysis of of what this might bill what this bill might look like over the next few years.

Speaker 0: Thank you, and certainly. And let's touch first on the united story, and then let's talk about the bill. Sure. What are you seeing there? What what are people saying there about the investigation?

Speaker 1: Yeah. So, like I said, this is, The Wall Street Journal's exclusive report this morning, basically saying that the the the the justice department's health care fraud unit has been questioning former employees with UnitedHealth as part of their wider investigation into the company's, MA billing practices. And we've talked about that investigation. We knew, I believe it was back in May that the journal first reported that the company is under criminal investigation for alleged Medicare Advantage fraud. That investigation reportedly started last year, and this, you know, this is the it's the upcoding issue that we've heard about for more than a decade.

Basically, that, allegedly, insurers are putting down faults or inflated diagnoses on on member records so that they get higher higher payments from from the government. And so according to the journal, the the DOJ, the government has been, asking former physicians, how how this all allegedly might have taken place, how how they received special training software that flagged profitable conditions, asking about bonuses for physicians who recoded patient files. And and one of the former doctors with the journal, that that the journal talked to, said that prosecutors were inquiring about pressure from the company to use certain diagnoses codes, and bonus pay for certain health care conditions that then financially favored United. And and this all, of course, comes on top of, two other DOJ probes into the company's billing practices and then potential antitrust violations, all alleged, between UnitedHealthcare and Optum, the two main units of the company. And so, the journal is reporting that United, in 2021 alone, received over $8,000,000,000 for diagnoses that were not supported by actual, claims from their members.

But United, you know, they've as as always, they've completely denied this. They stand by the integrity of their program. They say the journal is, has a has a campaign and a predetermined narrative against them, and they're relying on incomplete data. So a complete denial by United, but it's it's some insight into where the government is going. And and, you know, these doctors aren't making up what they're telling the journal.

So, it's a really interesting revelation to this week.

Speaker 0: No. It it's fascinating. In in United also, didn't they sue a different newspaper reporting on something related to this, or is that a different story?

Speaker 1: They they did. It's, you know, another, part of this Medicare Advantage conversation that there was, that they were allegedly either denying, post acute care discharges in in nursing homes, or and they're allegedly paying nursing homes to, steer their members to their Medicare Advantage Plans. And that was reported on by The Guardian based off a lot of document reviews according to them and a lot of interviews, and that's, you know, the British newspaper, and then United has called that defamation and is currently suing, The Guardian over that report, which, is completely separate from from what we're talking about today with The Wall Street Journal. So just a lot to keep up with this company and with this topic.

Speaker 0: No. Fascinating. And United, of course, is the third or fourth largest company in The United States by revenues. It's a big, big company. $8,000,000,000 out of their 400,000,000,000 or so, more than 60,000,000,000.

A serious number, particularly with 8,000,000,000 in codes that are is is it is that per year or is that in total 8,000,000,000 in codes?

Speaker 1: Yeah. According to the journal, they're saying they received $8,000,000,000 in overpayments, in 2021 alone.

Speaker 0: Got it.

Speaker 1: So that's one Got it. Yeah.

Speaker 0: Yeah. So so not insignificant. Well, very No. Very, very interesting. And so that's what's going on with United and and too early to really understand or speculate with what this means economically to the company and what it means to their caution going forward and how they built the Medicare Advantage program because, presumably, this will lead to a different level of caution in terms of how things are coded and so forth.

Just fascinating.

Speaker 1: And then And what I think what I think is really interesting too, Scott, is, you know, this is it's obviously it's a Republican administration, that is investigating this company. And on the flip side, we're seeing in Minnesota, with a Democratic governor, there was a bill passed recently that bans, for profit insurers from participating in the state's Medicaid program. Well, Minnesota is United Health's backyard, and they are no longer allowed to administer Medicaid in the state of Minnesota run by by a Democratic governor. So what's this you know, the the national context is telling us is that both sides of the aisle are are going after this company, either legislatively or or, you know, with these investigations, which I just think is, you know, fascinating context given everything we've heard and read about United over the last year or two.

Speaker 0: Well, it it sure is fascinating, but it also it there's also another piece of it that even though the administration is going after them to the Department of Justice, there's also this other side of it where they're increasing rates for Medicare Advantage, which, of course, the Medicare Advantage houses find that to be a a very positive thing. So you've got a couple different pieces here as well.

Speaker 1: We're

Speaker 0: we're so that just is absolutely fascinating. And so we'll see how it plays out, but it but it does speak to the fact you've got Democratic politicians, Republican politicians taking shots at the big insurance companies. It does speak to the to the populist mood of anti insurance companies at the moment. And so, you know, there there certainly is that mood and the both parties tap into that mood even though on one hand, Republicans tap into it, but then are giving the Medicare Advantage companies raises on the other hand too. So really, really fascinating.

Yeah.

Speaker 1: Nuance conversation for sure.

Speaker 0: Very much so.

Speaker 1: But I yeah. The other thing I wanna talk with you about in terms of nuanced conversations is is the one big beautiful bill act, which as everyone listening, I'm sure knows passed on on July 4 signed by president Trump. And, you know, you and I talked about, like I mentioned in the start, we talked about what the hospitals have been saying, what the insurers have been saying. You know, they're they're very concerned about loss of patient volumes, loss reimbursements, and and what that's gonna mean for their very tight margins. But I I came across, you know, today this interesting post on LinkedIn from a a a staff vice president at at Ellevance, which, you know, one of the largest health insurance companies in the world, and and staff vice president is a very high up position at that company.

Basically, talking about how he does not see this bill as as reckless, certainly an uncomfortable conversation, in terms of what it's leading to. But to quote him, he basically said Medicaid has been scaling and growing larger for years without stabilizing, that it's you know, there's a trillion dollars a year in this system. And yet even before the big beautiful bill, there were still rural health care closures, provider shortages, behavioral health network issues, basically pointing to the fact that that that there's he's saying that there's not a funding issue, that this is a wider system issue, and that the the legislation, it doesn't repeal the ACA. It doesn't dismantle Medicaid. According to him, what it does is it forces a harder conversation around who qualifies under what terms, and whether it's the dollars flowing to the actual care or whether it's maintaining the architecture that no longer works.

And he and he also argues that work requirements, that they're not new. We we've seen them, talked about federally before. We've seen a few states, try them or implement them. Not too much success, but we have seen it before. So it's just interesting that we are starting to see some insurance executives publicly, having not pro conversations about this legislation, but just different compared to even last week what we talked about, which is other insurance CEOs talking about the loss of Medicaid members and and, you know, the difficulties that that's gonna present for them over the next couple years.

So it just seems that there's people these executives are a little bit all over the map right now in terms of how they think this this legislation is gonna shake out. And then I had a few other things, in terms of the HSA changes, Scott, but I'll, in term yeah. I'll I'll pass it back to you.

Speaker 0: Yeah. No. It's it's incredibly complicated because the the reality is there is so much money floating through the system that people have a very hard time understanding what's real, what's needed, what's wasted, what's not. And at the same time, the flip side is if you're a fiscal conservative, you you sort of feel like, well, if you're gonna cut cost, then we ought to also cut deficits. And I think one of the most frustrating thing to fiscal conservatives is the concept that we're cutting costs in certain places, but the deficits continue to rise.

So it's it's it's very it's I I think there's I think the insurance executives thoughts from Elevant, there there's a lot that's right there that people are just very concerned about overall the spend in the government. At the same time, there there's also tremendous concern that the government just keeps on riding up and increasing the deficit. So and and then there's also this concern too that this is one of the things that politicians do all the time, but it's so, unpleasant is the the positives, meaning the tax cuts happen immediately, but the benefits cuts happen over time. And so Right. In in the immediate future, a lot of people might might not feel those negatives to the benefits, but you end up in a situation where even though they don't feel the benefits they they don't see the negatives, they're coming over time.

And that's quite confusing to people too.

Speaker 1: Definitely. Definitely. Especially, yeah, when it comes to Medicaid, that's definitely true. You know, this is gonna be a long term issue, and it won't necessarily be tied to the Republicans, but I I guess we'll see. But one thing I think too, you know, this bill did not extend the ACA premium tax credits, and there's still time to do that, but it's, you know, the the the winds are pointing that that probably will not occur.

At least that's what we're hearing. And, you know, they just have to lock in those rates. But that's

Speaker 0: a very interesting point because what happens is in in the prior Trump administration, he, at one point, tried to gut the ACA directly. And and I think, notwithstanding what the elephants executive says, I think many people feel like this is an indirect gutting of the ACA here because of those subsidies, because of those rates, because of those kinds of issues that those are gonna go away. So even though you didn't directly abolish the ACA or get rid of the ACA, you, for all practical purposes, have taken very, very strong strides at reducing it very, very significantly.

Speaker 1: Yeah. Definitely. I mean and I think the core of the issue there is that the the subsidies are around because the ACA coverage is just so expensive. So that's, you know, a core problem there. But in terms of, you know, very short term effects, insurers have to lock in their their ACA rates for for next year, this summer, but very soon.

And, you know, they're currently from what we're hearing, they're developing two sets of rates. One, you know, with the ACA if the premium subsidies are extended or not, so two different rates there. But if the if it's not extended and we'll know pretty soon, and those late rates are locked in, will those go into effect next year? So people, you know, buying, ACA coverage, a good chunk, especially low and middle income people, they'll they'll feel that effect pretty quickly because these rates, from what we're seeing, they're double digit requests all over the country in every state. So that'll be pretty quick in terms of what's being, more tied federally versus this bill specifically.

But one thing I did wanna mention, Scott, in terms of, you know, what concretely has been passed because of this it was included in this bill is that congress has and what we it's been called a unicorn, piece by some executives, speaking to us, is that congress has permanently extended a rule that allows people with high deductible plans linked to their, HSAs, to access telehealth services without having to meet their deductible first. So that was, you know, that was existed back in COVID, but now it's permanently extended, so that you can have covered telehealth and digital services at little to no out of pocket cost while still being able to contribute to your HSA. So that's a big change, that we've heard people are, you know, definitely talking about a lot. Next year, people enrolled in the bronze and catastrophic ACA plans can are eligible to contribute to HSA's, direct primary care arrangements are now HSA eligible. So there were some interesting employee benefits changes included in this bill that we've also heard a lot of conversations about, among our audience too.

Speaker 0: It it is fascinating. And what is fascinating behind all of this stuff is to understand a little bit all the lobbying that goes into these different very specific provisions and who drives them, who's behind them, who pushes for them. Because I don't imagine that too many congressmen or women or senators are sitting at midnight thinking about the very specific details of some of this stuff. I assume that a lot of it is fed to them by people that have a vested interest in one position or another.

Speaker 1: Yeah. No. It's I I totally agree, and it's fascinating that you could probably trace single lines of these bills back to certain trade groups or or stakeholders. And I guess in that vein, we didn't see some, some codification of ICRA, those those alternative health insurance arrangements with employers. Those were removed from the bill, and that would have codified the tax credit nationally versus where it's currently on a state by state basis.

So clearly, the ICRA industry didn't have enough voice in this, but, you know, HSAs did. So it's it's just very interesting as you go through this line by line and figure out what made it and what didn't.

Speaker 0: It it it that really is. Jacob, always a pleasure to visit with you. I always learn so much. I hope our audience does too. Thank you so much for joining us today on the Becker's Healthcare Podcast.

Thank you very, very much.

Speaker 1: Thank you, Scott.