1 00:00:00,080 --> 00:00:02,319 This is Jacob Emerson with the Becker's Payer 2 00:00:02,319 --> 00:00:03,379 Issues podcast. 3 00:00:03,919 --> 00:00:07,540 Here's your industry news briefing for October 28th. 4 00:00:08,160 --> 00:00:10,800 UnitedHealth Group representatives are set to meet with 5 00:00:10,800 --> 00:00:13,679 Justice Department officials to make the case for 6 00:00:13,679 --> 00:00:16,524 the company's acquisition of Amedisys to be approved. 7 00:00:17,065 --> 00:00:19,225 That meeting is often the last step before 8 00:00:19,225 --> 00:00:21,725 the DOJ decides whether to file a lawsuit 9 00:00:21,945 --> 00:00:23,324 challenging an acquisition. 10 00:00:23,945 --> 00:00:26,845 Amedisys provides home health, hospice, and high acuity 11 00:00:26,984 --> 00:00:30,125 care. It operates more than 500 facilities across 12 00:00:30,265 --> 00:00:30,765 37 13 00:00:31,670 --> 00:00:35,109 states. Amedis' shareholders approved that acquisition back in 14 00:00:35,109 --> 00:00:36,329 September of 2023. 15 00:00:37,030 --> 00:00:39,289 The deal has been held up by regulatory 16 00:00:39,510 --> 00:00:42,630 scrutiny. DOJ officials are concerned the deal could 17 00:00:42,630 --> 00:00:44,935 increase prices for home health services. 18 00:00:45,475 --> 00:00:48,354 UnitedHealth also acquired LHC Group, a home health 19 00:00:48,354 --> 00:00:50,534 provider with more than 900 locations 20 00:00:50,914 --> 00:00:52,534 back in February 2023. 21 00:00:53,234 --> 00:00:55,954 If the acquisition of Amedisys is approved, the 22 00:00:55,954 --> 00:00:58,369 company would own 10% of the home health 23 00:00:58,369 --> 00:01:01,809 market, UnitedHealth that is, with significant overlap between 24 00:01:01,809 --> 00:01:05,189 Amedisys and LHC Acquisitions in some southern states. 25 00:01:05,729 --> 00:01:08,450 Regulators could approve the deal with some changes 26 00:01:08,450 --> 00:01:10,229 to address competition concerns. 27 00:01:10,594 --> 00:01:13,155 In August, Amedisys and UnitedHealth agreed to sell 28 00:01:13,155 --> 00:01:16,135 an undisclosed number of care center care centers 29 00:01:16,435 --> 00:01:19,075 to Vital Caring Group if the merger is 30 00:01:19,075 --> 00:01:19,575 approved. 31 00:01:21,394 --> 00:01:23,974 Well, Medicare Advantage companies are bringing in 1,000,000,000 32 00:01:24,114 --> 00:01:27,219 in questionable payments found during in home visits 33 00:01:27,219 --> 00:01:30,420 and chart reviews. That's according to HHS's office 34 00:01:30,420 --> 00:01:32,979 of inspector general in a new audit. That 35 00:01:32,979 --> 00:01:35,939 report was published October 24th, and the federal 36 00:01:35,939 --> 00:01:39,060 watchdog estimated that MA companies received 7 and 37 00:01:39,060 --> 00:01:39,799 a half $1,000,000,000 38 00:01:40,179 --> 00:01:42,605 in payments through health risk assessments and chart 39 00:01:42,605 --> 00:01:43,105 reviews. 40 00:01:43,564 --> 00:01:46,305 The watchdog wrote that questionable use of HRAs 41 00:01:46,444 --> 00:01:48,465 is driving up payments to plans. 42 00:01:49,245 --> 00:01:52,525 MA plans conduct HRAs to collect information about 43 00:01:52,525 --> 00:01:53,825 enrollee health status. 44 00:01:54,370 --> 00:01:57,010 These assessments are sometimes conducted by providers as 45 00:01:57,010 --> 00:01:57,829 part of beneficiaries 46 00:01:58,209 --> 00:02:01,489 annual wellness visits or in their homes. MA 47 00:02:01,489 --> 00:02:03,030 plans also conduct 48 00:02:03,329 --> 00:02:05,729 chart reviews to find diagnoses that may have 49 00:02:05,729 --> 00:02:07,909 been missed by providers during visits. 50 00:02:08,525 --> 00:02:09,905 CMS found that 1,700,000 51 00:02:10,284 --> 00:02:13,245 Medicare Advantage enrollees with diagnoses from HRAs and 52 00:02:13,245 --> 00:02:13,985 chart reviews 53 00:02:14,444 --> 00:02:15,665 were not substantiated 54 00:02:15,965 --> 00:02:17,025 by any other 55 00:02:17,325 --> 00:02:20,460 visits, procedures, or tests in their medical records. 56 00:02:21,659 --> 00:02:24,300 Diagnoses reported only on an HRA conducted at 57 00:02:24,300 --> 00:02:26,379 any setting, but on no other service records, 58 00:02:26,379 --> 00:02:29,200 raise questions about whether the diagnoses are valid 59 00:02:29,340 --> 00:02:32,460 and whether enrollees got needed care according to 60 00:02:32,460 --> 00:02:33,200 the reports. 61 00:02:34,805 --> 00:02:36,805 UnitedHealth Group stood out from its peers in 62 00:02:36,805 --> 00:02:38,405 its in in its use of in home 63 00:02:38,405 --> 00:02:40,965 visits and chart reviews to generate payments according 64 00:02:40,965 --> 00:02:41,705 to the OIG. 65 00:02:42,164 --> 00:02:44,805 United is also the largest Medicare Advantage provider 66 00:02:44,805 --> 00:02:45,784 and receives $3,700,000,000 67 00:02:46,644 --> 00:02:48,965 in risk adjustment payments from HRAs and chart 68 00:02:48,965 --> 00:02:50,449 reviews in 2023. 69 00:02:51,310 --> 00:02:53,490 In a statement shared with Becker's, a UnitedHealthcare 70 00:02:53,790 --> 00:02:56,050 spokesperson said that the report is a misleading, 71 00:02:56,189 --> 00:02:59,069 narrow, and incomplete view of risk adjustment data 72 00:02:59,069 --> 00:03:01,550 and is being used to draw inaccurate conclusions 73 00:03:01,550 --> 00:03:03,949 about the value of in home care for 74 00:03:03,949 --> 00:03:04,770 MA beneficiaries. 75 00:03:07,495 --> 00:03:09,974 Well, Kodiak Solutions says that its analysis of 76 00:03:09,974 --> 00:03:12,854 hospital inpatient and outpatient claims data suggests that 77 00:03:12,854 --> 00:03:15,335 payers are, quote, continuing to apply their own 78 00:03:15,335 --> 00:03:17,194 criteria for inpatient admissions 79 00:03:17,540 --> 00:03:20,020 and dismissing the 2 midnight rule for Medicare 80 00:03:20,020 --> 00:03:20,520 beneficiaries. 81 00:03:21,379 --> 00:03:23,460 The firm analyzed claims data for more than 82 00:03:23,460 --> 00:03:25,800 1900 hospitals between July 2023 83 00:03:26,099 --> 00:03:27,000 June 2024. 84 00:03:27,780 --> 00:03:31,164 The analysis compares observation rates prior to and 85 00:03:31,164 --> 00:03:33,905 following the January 2024 implementation 86 00:03:34,205 --> 00:03:36,364 of the 2 midnight rule for Medicare Advantage 87 00:03:36,364 --> 00:03:36,864 plans. 88 00:03:37,324 --> 00:03:40,064 Kodiak analyzed data for 3 health plan categories, 89 00:03:40,284 --> 00:03:42,944 commercial, Medicare Advantage, and traditional Medicare. 90 00:03:43,389 --> 00:03:46,370 The data showed that ma plans began classifying 91 00:03:46,590 --> 00:03:49,250 fewer observation stays starting in January 92 00:03:49,709 --> 00:03:52,689 observation rates for ma plans ranged between 18% 93 00:03:53,150 --> 00:03:55,514 20% of claims in the last 6 months 94 00:03:55,514 --> 00:03:57,754 of last year and then fluctuated with a 95 00:03:57,754 --> 00:03:59,055 lower range of 14% 96 00:03:59,354 --> 00:03:59,854 16% 97 00:04:00,155 --> 00:04:01,914 in the 6 1st 6 months of this 98 00:04:01,914 --> 00:04:02,414 year. 99 00:04:02,794 --> 00:04:05,514 Observation rates in traditional Medicare also trended down 100 00:04:05,514 --> 00:04:07,594 over the 12 month period but within a 101 00:04:07,594 --> 00:04:10,395 range of 5.2 to 3.7 percent with the 102 00:04:10,395 --> 00:04:12,290 exception of a spike to 8 a half 103 00:04:12,290 --> 00:04:13,430 percent in December. 104 00:04:14,050 --> 00:04:16,370 According to Kodiak, the gap in observation rates 105 00:04:16,370 --> 00:04:19,089 between MA plans and traditional Medicare suggest that 106 00:04:19,089 --> 00:04:21,170 MA plans are not fully complying with the 107 00:04:21,170 --> 00:04:24,050 federal rule requiring them to offer members the 108 00:04:24,050 --> 00:04:27,045 same coverage as traditional Medicare. Our data shows 109 00:04:27,045 --> 00:04:29,045 that MA observation rates are similar to the 110 00:04:29,045 --> 00:04:31,605 rates among patients covered by commercial insurance. And, 111 00:04:31,605 --> 00:04:33,764 of course, most of the MA plans are 112 00:04:33,764 --> 00:04:36,185 also providers of commercial insurance. 113 00:04:37,764 --> 00:04:40,980 Well, Centene is the latest insurer challenging CMS' 114 00:04:41,540 --> 00:04:44,339 star ratings in court. In a lawsuit filed 115 00:04:44,339 --> 00:04:46,980 October 22nd, Centene asked a federal judge to 116 00:04:46,980 --> 00:04:50,360 require CMS to calculate recalculate its star ratings 117 00:04:50,819 --> 00:04:53,460 without including a secret shopper phone call. Centene 118 00:04:53,460 --> 00:04:56,175 says never reached its call centers. C Mass 119 00:04:56,175 --> 00:04:57,475 conducts secret shopper's 120 00:04:57,855 --> 00:05:00,895 calls to score plans' customer service functions, including 121 00:05:00,895 --> 00:05:02,194 text to voice services. 122 00:05:02,574 --> 00:05:04,655 These services are often used by individuals with 123 00:05:04,655 --> 00:05:06,115 hearing or speech disabilities. 124 00:05:06,574 --> 00:05:09,210 In its lawsuit, Centene alleged the agency included 125 00:05:09,210 --> 00:05:10,970 a call that never reached its call center 126 00:05:10,970 --> 00:05:13,069 due to no fault of its own Centene 127 00:05:13,129 --> 00:05:15,210 alleged the secret shopper's notes show that the 128 00:05:15,210 --> 00:05:16,589 chat window closed unexpectedly 129 00:05:16,889 --> 00:05:18,350 which Centene called 130 00:05:18,650 --> 00:05:20,270 a clear failure of CMS's 131 00:05:20,889 --> 00:05:21,389 software 132 00:05:22,455 --> 00:05:24,774 star ratings determine whether plans are eligible for 133 00:05:24,774 --> 00:05:27,334 bonus payments from CMS the inclusion of the 134 00:05:27,334 --> 00:05:29,735 call in its rating will cause Centene to 135 00:05:29,735 --> 00:05:30,875 lose out on $73,000,000 136 00:05:31,415 --> 00:05:33,115 in revenue according to the company 137 00:05:33,574 --> 00:05:36,339 several other insurers have challenged CMS's star ratings 138 00:05:36,339 --> 00:05:38,040 in court this year UnitedHealthcare 139 00:05:38,420 --> 00:05:38,920 also 140 00:05:39,300 --> 00:05:41,459 disputed the inclusion of a secret shopper phone 141 00:05:41,459 --> 00:05:43,939 call it says never connected to its call 142 00:05:43,939 --> 00:05:44,439 center 143 00:05:44,980 --> 00:05:47,595 well UnitedHealth Group has reached a settlement with 144 00:05:47,675 --> 00:05:50,314 the US Department of Labor over allegations that 145 00:05:50,314 --> 00:05:53,355 the company improperly denied claims for emergency room 146 00:05:53,355 --> 00:05:56,555 visits and urinary drug screenings for thousands of 147 00:05:56,555 --> 00:05:57,055 patients. 148 00:05:57,514 --> 00:05:59,834 The final settlement amount is unclear, but that 149 00:05:59,834 --> 00:06:02,574 order was signed October 21st in a Wisconsin 150 00:06:02,714 --> 00:06:05,649 federal court. The Labor Department originally filed its 151 00:06:05,649 --> 00:06:06,949 lawsuit against UnitedHealth 152 00:06:07,490 --> 00:06:07,990 subsidiary, 153 00:06:08,370 --> 00:06:10,230 UMR, in July 2023. 154 00:06:11,009 --> 00:06:12,310 UMR is UnitedHealthcare's 155 00:06:12,689 --> 00:06:15,589 third party administrator that provides health benefits services 156 00:06:15,889 --> 00:06:16,949 to more than 21100 157 00:06:17,330 --> 00:06:18,824 self funded employer plans. 158 00:06:19,384 --> 00:06:22,185 By denying emergency claims quote based solely on 159 00:06:22,185 --> 00:06:24,764 diagnosis codes and not implying a prudent layperson 160 00:06:24,824 --> 00:06:27,725 standard, the government said that UMR violated 161 00:06:28,105 --> 00:06:29,004 e ERISA 162 00:06:29,384 --> 00:06:30,444 which oversees 163 00:06:31,145 --> 00:06:34,949 self funded plans. The department added that UMR's 164 00:06:35,089 --> 00:06:37,730 explanation to members for the denied emergency claims 165 00:06:37,730 --> 00:06:40,689 violated the ACA and the government's internal claims 166 00:06:40,689 --> 00:06:41,750 procedures regulations. 167 00:06:42,449 --> 00:06:45,170 For urinary test denials, the labor department alleged 168 00:06:45,170 --> 00:06:47,654 that UMR denied all claims from August 20 169 00:06:47,654 --> 00:06:49,115 15 to August 2018 170 00:06:49,814 --> 00:06:52,954 without determining whether a claim was medically necessary. 171 00:06:53,334 --> 00:06:55,654 The lawsuit had sought to require UMR to 172 00:06:55,654 --> 00:06:58,294 reform its emergency and urinary drug testing claims 173 00:06:58,294 --> 00:06:58,794 procedures 174 00:06:59,095 --> 00:07:01,889 to comply with ERISA and re adjudicate all 175 00:07:01,889 --> 00:07:05,269 denied or partially denied claims from January 1, 176 00:07:05,810 --> 00:07:06,310 2015 177 00:07:06,689 --> 00:07:07,829 to the present day. 178 00:07:10,370 --> 00:07:12,449 Wall Street analysts say that a potential Cigna 179 00:07:12,449 --> 00:07:14,529 Humana merger depends on the results of the 180 00:07:14,529 --> 00:07:15,750 presidential election. 181 00:07:16,105 --> 00:07:19,464 Bloomberg reported on October 18th that Cigna and 182 00:07:19,464 --> 00:07:21,485 Humana had resumed merger discussions. 183 00:07:21,865 --> 00:07:23,705 They were in talks to merge in late 184 00:07:23,705 --> 00:07:25,944 2023, but the deal fell apart over a 185 00:07:25,944 --> 00:07:27,324 disagreement on price. 186 00:07:29,430 --> 00:07:32,069 One analyst with wrote said told Bloomberg that 187 00:07:32,069 --> 00:07:34,790 the merger would only tangibly move forward if 188 00:07:34,790 --> 00:07:37,670 Republican nominee Donald Trump wins in November. If 189 00:07:37,670 --> 00:07:39,589 Humana and Cigna merge, it would create one 190 00:07:39,589 --> 00:07:41,264 of the largest health care companies in the 191 00:07:41,425 --> 00:07:41,925 US 192 00:07:42,384 --> 00:07:44,645 and certainly draw antitrust to scrutiny. 193 00:07:45,105 --> 00:07:48,145 Under current FTC chair, Lena Khan's leadership, at 194 00:07:48,145 --> 00:07:50,384 least 7 major health care deals have been 195 00:07:50,384 --> 00:07:50,884 blocked. 196 00:07:51,185 --> 00:07:53,425 A second Trump administration could take a more 197 00:07:53,425 --> 00:07:56,870 permissive view towards m and a. The administration 198 00:07:57,089 --> 00:07:58,709 approved CVS Health's $69,000,000,000 199 00:07:59,410 --> 00:08:01,430 acquisition of Aetna in 2018. 200 00:08:02,689 --> 00:08:04,850 And finally, Elevance Health is laying off a 201 00:08:04,850 --> 00:08:07,350 123 employees in Southern California. 202 00:08:07,845 --> 00:08:10,165 Elevance will lay off 59 employees at Anthem 203 00:08:10,165 --> 00:08:13,524 Blue Cross in Woodland Hills and 64 employees 204 00:08:13,524 --> 00:08:15,785 at a Carillon office in in Cerritos. 205 00:08:16,805 --> 00:08:19,125 Last October, CEO Gail Boudreaux said the company 206 00:08:19,125 --> 00:08:20,105 took about $700,000,000 207 00:08:20,725 --> 00:08:23,360 in charges due to workforce adjustments and technology 208 00:08:23,420 --> 00:08:26,220 asset write offs during a strategic review. Since 209 00:08:26,220 --> 00:08:28,220 then, the company has laid off 90 employees 210 00:08:28,220 --> 00:08:31,020 at a facility in Dearborn, Michigan, 87 other 211 00:08:31,020 --> 00:08:34,220 employees in Woodland Hills, and 57 workers at 212 00:08:34,220 --> 00:08:35,600 a facility in Minnesota. 213 00:08:36,105 --> 00:08:37,945 If you'd like the latest health insurance industry 214 00:08:37,945 --> 00:08:40,105 news delivered straight to your inbox every morning, 215 00:08:40,105 --> 00:08:42,365 subscribe to the Becker's payer issues e newsletter 216 00:08:42,424 --> 00:08:44,044 on our website at beckerspayer.com.