 |
|
| Sample Newsletters | MarketPlace AIS Products & Services |
|
Government News
|
|
|
|
June 21, 2010
|
1. The California Department of Insurance has ordered independent reviews on proposed premium rate hikes submitted by four of the state’s largest insurers in the individual market. The department’s decision came after an analysis by Axene Health Partners found “significant errors” with Anthem Blue Cross’ recent rate filing, which requested rate increases of up to 39% for some policyholders. The WellPoint, Inc. subsidiary said it expects to re-file its rate request in July. In addition to Anthem, reviews will be conducted on Blue Shield of California, Aetna Inc. and Health Net, Inc. The Los Angeles Times reported on June 16 that California Blue Shield is seeking an average rate hike of 18% for its 240,000 individual policyholders, and Aetna is seeking a 19% increase for its 65,000 individual members. Health Net declined to discuss its rates.
2. The Indiana Family & Social Services Administration (FSSA) on June 4 picked the three incumbent health plan operators to enter into contract negotiations for renewal of its huge Medicaid managed care contract for Hoosier Healthwise and for a new low-income commercial program called Healthy Indiana Plan. The three are WellPoint, Inc.’s Anthem Insurance Companies, Inc. unit, Centene Corp.’s Managed Health Services and local not-for-profit MDwise, Inc.
There was only one other bidder for the contract, provider-owned local entry ADVANTAGE Health Solutions, Inc., which also was an unsuccessful bidder on the last contract in 2006. Three other insurers — Aetna Inc., Coventry Health Care, Inc. and AMERIGROUP Corp. — attended this year’s pre-proposal bidders’ conference, but did not submit a bid, FSSA said.
The selection does not mean that all three plans will wind up with the four-year contracts, FSSA noted, since state requirements specify only that at least two contractors get the pacts. FSSA estimated the contracts are worth $4.43 billion over the four years and said they will start next Jan. 1.
The company that seemingly has the most at stake is publicly owned Centene, which recently lost a bid to keep a big Medicaid pact in southeast Wisconsin. Perhaps with that in mind, Centene on June 4 put out a statement indicating it had been awarded the Indiana contract, prompting FSSA to put out its own statement that “this announcement was incorrect” since there still have to be contract negotiations. Centene, though, did get the highest quality and evaluation scores in the state rankings for the contract bids, and its stock price gained 76 cents to close at $23.58 in a sharply down day on Wall Street June 4.
The company now has about 211,000 Medicaid members in the state, notes Brian Wright, a securities analyst with Collins Stewart, LLC, and stands to gain 9 cents to 11 cents a share in earnings by retaining the contract. Centene’s share of Medicaid members would go up only if there were just two vendors selected, he points out. Wright tells MAN that he doesn’t know why Aetna, AMERIGROUP and Coventry didn’t bid, but adds that “the incumbents were in good position.”
In its “Award Recommendation Letter” June 2, Pat Casanova, director of the Office of Medicaid Policy and Planning in FSSA, detailed the scoring that led to the recommendation of the three plans. There were separate rankings for the business proposal and technical proposal, and Centene led in both categories, while Anthem came next in technical and MDwise was next in business. ADVANTAGE was last in both categories, and also trailed in the cost-proposal category. After ADVANTAGE was eliminated, the three other plans were ranked in four other categories, and Centene kept its lead.
One reason other plans may have been less than enthusiastic about the Indiana contract is the underlying regulatory framework. Indiana cut Medicaid rates 4.6% effective Jan. 1 and carved out its pharmacy benefit. Moreover, noted Carl McDonald, then a securities analyst with Oppenheimer & Co. and now with Citigroup, the state plans to require a minimum 85% medical loss ratio for both programs that were bid and “intends to adopt a very strict definition of a medical loss ratio.”
He added that plans also are responsible for some form of health needs screenings for their members, thereby increasing their up-front costs.
Nevertheless, noted McDonald, Centene has been able, with the help of provider recontracting, to turn a consistent profit in the state since the most recent contract began in 2007. And contrary to his expectations, McDonald said, profitability in the first quarter of 2010 appeared to have risen and suggests that Centene may generate about $315 million in premiums and $14 million in earnings before interest, taxes, depreciation and amortization for full-year 2010.
Reprinted from the June 17, 2010, issue of MEDICARE ADVANTAGE NEWS
3. As of June 1, Medicare Advantage plan enrollment was 11.7 million members, a gain of 29,500 from May 1, and 613,172 more than June 1 last year, according to CMS data released June 7 for the period ending May 7. UnitedHealth Group had the biggest gain for the month with 5,808 lives, but Humana Inc. saw the largest growth for the 12-month period with 266,441 new enrollees, notes securities analyst Tom Carroll, managing director at Stifel Nicolaus Capital Markets. Carroll said he is still forecasting total MA program enrollment of 11.9 million by year’s end, up 575,000 from the year-ago level. Contact Carroll at tacarroll@stifel.com. For comprehensive enrollment data on MA and Medicaid plans operating in the U.S, visit AIS’s MarketPlace and click on Managed Medicare and Medicaid Factbook.
Reprinted from the June 17, 2010, issue of MEDICARE ADVANTAGE NEWS
4. In an effort to increase the number of physicians, nurses and other medical providers, HHS Sec. Kathleen Sebelius said June 16 that the agency will make $250 million in new investments. The spending comes from the $500 million Prevention and Public Health Fund created by the health reform law. It includes $168 million for training 500 new primary care physicians by 2015, $32 million for educating more than 600 new physician assistants, $30 million for encouraging more than 600 nursing students to attend school full-time and complete their education, $15 million for the operation of 10 nurse-managed health clinics in communities that are underserved, and $5 million for states to expand their primary care work force by 10% to 25% during the next 10 years. To view a fact sheet, click here.
Reprinted
from the June 21, 2010, issue of HEALTH PLAN WEEK
5. The HHS Office of Inspector General expects Medicare and Medicaid recoveries for the first half of fiscal year 2010 to reach more than $3 billion, OIG says in its Semiannual Report to Congress, released June 14. The recoveries for October 2009 through March 2010 include about $667 million from audits and $2.5 billion from investigations, OIG says. So far in FY 2010, which ends Sept. 30, OIG has excluded 1,935 individuals and entities, which means they can’t participate in federal health care programs. It also reports 293 criminal actions and 164 civil cases. To read the entire report, go to oig.hhs.gov and click on “What’s New.”
Reprinted from the June 21, 2010, issue of REPORT ON MEDICARE COMPLIANCE
6. A June 15 Government Accountability Office (GAO) report names five strategies to prevent Medicare fraud and reduce improper payments. The strategies include (1) strengthening provider enrollment processes, (2) improving pre-payment reviews, (3) focusing post-payment reviews on more vulnerable areas, (4) improving contractor oversight, and (5) developing a robust process for addressing vulnerabilities. The strategies come from GAO products issued between September 2005 and March 2010 and from updated information GAO received from CMS in June 2010. GAO says CMS has made progress in some of these areas, but still faces challenges. Read the report (GAO-10-844T) at www.gao.gov.
Reprinted from the June 21, 2010, issue of REPORT ON MEDICARE COMPLIANCE
7. A New York City dermatologist will pay a total of $2.75 million to the New York state and federal governments to settle allegations that he submitted false claims to Medicare and Medicaid, the U.S. Attorney’s Office for the Southern District of New York said June 10. Lawrence Jaeger, D.O., serves beneficiaries at office locations in the Bronx and Manhattan. The feds allege that he upcoded Medicare services. Also, the feds allege that when Jaeger was applying for Medicaid certification he “falsely represented” that many of the services he would be providing would be primary-care services. The case stems from a whistleblower suit filed by David Charig, who worked as a physician’s assistant in one of the offices.
Reprinted from the June 21, 2010, issue of REPORT ON MEDICARE COMPLIANCE
8. HHS’s Office of Consumer Information and Insurance Oversight has informed states that by June 25 they must notify OCIIO how they intend to run their high-risk insurance pool programs and how much the programs will cost. High-risk pools, which were created by the health reform law to provide insurance to people who have been denied coverage due to a pre-existing medical condition, will begin enrollment on July 1, with coverage starting on Aug. 1. The program will continue until 2014 when state-based health insurance exchanges become available. As of May 21, 29 states and the District of Columbia had signaled an interest in operating their own programs, 19 states had declined and two states were undecided. The states that declined said they were concerned that the $5 billion in federal funding was not enough, and that they could be stuck footing the bill. However, in a letter to the states, Jay Angoff, director of OCIIO, tried to assure them that the funds will last for the duration of the program.
9. A Boise, Idaho, woman pleaded guilty May 20 to health care fraud for fraudulently billing between $70,000 and $120,000 to Medicaid, according to the U.S. Attorney’s Office for the District of Idaho. Tina Lancaster was the co-director, president and a physical therapist for the Idaho Children’s Academy and Therapy Center. She allegedly billed Medicaid for services not rendered, services not provided by a licensed physical therapist and services not authorized by a physician. She faces 10 years in prison and a $250,000 fine when she is sentenced in August.
Reprinted from the June 2010 issue of The HCCA-AIS MEDICAID COMPLIANCE NEWS
10. The Department of Justice obtained a $10 million consent judgment against Intercare Health Systems Inc., the former owner of the City of Angels Medical Center, for Medicare and Medi-Cal fraud, DOJ said May 27. The consent judgment, which California also joined, resolves a civil lawsuit filed against Intercare by the feds and the state. The suit complaint alleged that City of Angels paid recruiters in the skid row area of Los Angeles to bring homeless people to the hospital for medical treatment regardless their need for treatment. City of Angels would then bill Medicare and Medi-Cal for medical services rendered to the homeless patients, many of which were not medically necessary.
Reprinted from the June 2010 issue of The HCCA-AIS MEDICAID COMPLIANCE NEWS
11. Health Care Service Corp. filed a lawsuit on June 4 against Pfizer Inc. for allegedly marketing three top-selling drugs in a deceptive manner and encouraging physicians to prescribe the drugs for unapproved uses. In a complaint submitted to the U.S. District Court for the Eastern District of Texas, HCSC charges that Pfizer misled physicians about the safety and effectiveness of the anti-inflammatory drug Bextra, the anti-psychotic Geodon and the anti-epilectic Lyrica. HCSC further alleges that Pfizer paid kickbacks to physicians for prescribing those drugs. The insurer is seeking damages resulting from Pfizer’s “deceptive sale and marketing strategies” that led to “inflated demand” and caused HCSC to pay for prescriptions for the drugs “often in lieu of paying for cheaper, yet equally effective, drugs.” In September 2009, Pfizer paid $2.3 billion in civil and criminal penalties to settle similar lawsuits over its promotion of Bextra, Geodon, Lyrica and other drugs. Pfizer spokesperson Chris Loder tells AIS, “This is a case of an insurance company seeking its money back for medicines that physicians prescribed appropriately using their best medical judgments. Pfizer denies the allegations brought by the insurer in this case.”
Reprinted from the June 14, 2010, issue of The AIS Report on Blue Cross and Blue Shield Plans*
*Not affiliated with the Blue Cross and Blue Shield Association or its member companies.
| Hot Products |
|
New
• Managed Medicare and Medicaid Factbook: 2010 • Special Needs Plans: Regulatory Challenges and Market Strategies • Health Reform’s Impact on Commercial and Medicare Health Plans *Not affiliated with the Blue Cross Blue Shield Association or its member companies. Best
Sellers • Report on Patient Privacy and AIS's HIPAA Compliance Center • 2000-2009 Survey Results: Pharmacy Benefit Trends & Data • Guide to Managing Never Events and HACs See full
listing |
| Hot Products |
|
New
• Managed Medicare and Medicaid Factbook: 2010 • Special Needs Plans: Regulatory Challenges and Market Strategies • Health Reform’s Impact on Commercial and Medicare Health Plans *Not affiliated with the Blue Cross Blue Shield Association or its member companies. Best
Sellers • Report on Patient Privacy and AIS's HIPAA Compliance Center • 2000-2009 Survey Results: Pharmacy Benefit Trends & Data • Guide to Managing Never Events and HACs See full
listing |
1100 17th Street, NW, Suite 300, Washington, DC 20036
Phone 202-775-9008 or 800-521-4323; E-mail customerserv@aishealth.com