This is Jacob Emerson with the Becker's Payer
Issues podcast.
Here's your biweekly industry news briefing for January
6th.
The majority of health plan executives say they're
focused on growth and have a favorable outlook
for 2025.
That's according to a new survey from Deloitte.
Between August September of last year, Deloitte surveyed
40 c suite executives from large health plans
and large health systems nationwide
with revenues greater than $500,000,000.
Do you identify the top trends expected to
affect business strategies
this year? Among those respondents, 65% said developing
growth strategies
is
their top priority for the year, and 59%
have a favorable outlook for the year ahead.
A rise in revenues is expected by 69%
of respondents, and a rise in profitability
is expected by 71%.
Overall, large health care companies should be focused
on consumer acquisition and retention, meeting the needs
of those customers, investing in digital platforms, strengthening
cybersecurity,
and prioritizing health equity. Insurers specifically should also
be prioritizing working more closely with employers on
certain health products,
expanding alternative and virtual care sites and consumer
facing digital tech, and enhancing operational efficiencies.
60% of insurance executives expect the adoption of
digital technology to accelerate in 2025,
while 53%
expect that generative AI and other tech like
unlimited reality and digital twins
will impact organizational strategies.
Executives were asked to list the emerging trends
they are tracking most heavily,
and 58% identified AI and automation first.
Many health plans are already using generative AI
for claims processing, underwriting, personalized treatment plans, fraud
detection, and document extraction.
Also among the health plan respondents, 58%
expect that recent and upcoming regulatory changes
will influence their organization's strategies this year, and
63% are already prioritizing
compliance strategies
to address those challenges.
The UnitedHealth Group has been named the world's
largest insurer by net premiums written for the
10th year in a row. That's according to
AM Best annual ranking published this January.
The top 10 insurers in the world by
2023
net premiums written. Number 1 is UnitedHealth Group.
2nd, Centene, and it's Elavance Health. 4th is
Kaiser Permanente. 5th is China Life Insurance Company.
6th is Humana, then State Farm, then Alliance
SE. Number 9 is Berkshire Hathaway. And number
10 is AXA SA out of France.
Well, Elavance Health has completed its acquisition of
Indianapolis based Indiana University Health's insurance business.
With the closure of the deal that was
first announced back in September, IU Health Plans
will now operate as part of Anthem BCBS
of Indiana.
IU Health Plans serves 19,000 Medicare Advantage members
across 36 counties
and just under 10,000 fully insured commercial group
members through employers.
The acquisition of IU's health plans is one
of several that Elavance has announced or completed
in 2024.
The company said back in April that it
plans to acquire Center's plan for Healthy Living,
a New York based Medicaid long term care
plan.
The company also closed on its acquisition of
infusion center and specialty pharmacy operator, Paragon Healthcare.
And in October, the company said it intends
to purchase Nashville based CareBridge,
which is a value based home and community
based care provider for patients with chronic and
complex needs.
Florida Blue is the latest insurer to sue
CMS over its Medicare Advantage star ratings for
2025.
In that lawsuit filed in December in a
federal district court in Washington, attorneys for Florida
Blue argued that CMS did not account for
the effects of natural disasters when it calculated
the insurer's Medicare Advantage star ratings.
Severe flooding in Broward County in April 2023
caused a significant drop in rates of office
visits and prescription refills
for Florida Blues MA plan members according to
the insurer.
Though Florida governor Ron DeSantis and president Joe
Biden declared a state of emergency in areas
affected by the flooding, CMS did not grant
an 1135
waiter, designating a public health emergency for the
flooding.
In 2019, CMS adopted an extreme circumstances rule
to account for the impact of natural disasters
and other uncontrollable
circumstances
that might affect star ratings.
If the flooding in Broward had been granted
public emergency status, Florida Blue's HMO MA plan
would have received a 4 and a half
star rating rather than a 3 and a
half stars for plan year 2025.
According to the payer,
its Medicare Part D plan would have received
a 3 star rather than a 2 and
a half star rating. Florida Blue said it
will lose out on tens of 1,000,000 of
dollars in bonus payments as a result of
those lower ratings, and it is asking the
courts to require CMS to recalculate
those ratings.
Several other insurers have challenged those 2025 ratings
in courts, though on different grounds. In December,
CMS increased the ratings for several UnitedHealth and
Centene plans,
and Humana and Elavance have also filed similar
challenges.
The new California law that went into effect
January 1st will prohibit payers from making coverage
decisions based solely on artificial intelligence
algorithms.
Under that new law, any denial, delay, or
modification of care based on medical necessity
must be reviewed and decided by a licensed
physician or qualified health care provider with expertise
in the specific clinical issues at hand.
California senator Josh Becker, the bill's sponsor, said
that AI has immense potential to enhance health
care delivery, but it should never replace the
expertise and judgment of physicians.
An algorithm cannot fully understand a patient's unique
medical history or needs, and its misuse can
lead to devastating consequences.
And finally, a former chief human resources officer
at Elevance Health, Troy Hennigan,
has filed a lawsuit against the company in
a georgia federal court alleging age
discrimination after his termination
in June of last year. The lawsuit claims
that mister Hannigan, who is 62,
was unlawfully replaced as the CHRO at Carillon
by a younger individual, and he alleges that
his termination violated the age discrimination in employment
act. Elevance denied those allegations in an October
legal response,
asserting that mister Hennigan's termination was based on
legitimate business decisions unrelated to his age. Mister
Hennigan had been with elevance since 2019. According
to the September complaint, his supervisor informed him
in February of 2024
that the company wanted to go in another
direction and hire a younger person for his
role, describing the decision as a win win
because people assumed he wanted to retire.
Mister Hennigan resisted this alleged narrative, proposing to
remain through the end of the year, though
that proposal was rejected.
He claims that his departure was falsely framed
as a retirement in company communications,
and this position was ultimately filled by someone
under the age of 43.
In its response, elevance denied any discriminatory statements
attributed to mister Hennigan's supervisor, such as his
desire to hire a younger person. And the
company is arguing that he agreed to describe
his his departure as a retirement and asserts
that it acted in good faith to comply
with anti discrimination laws.
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