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Health and Human Services (HHS) Secretary Alex Azar was in front of the US Senate Health Committee for a hearing today on drug pricing. His prepared remarks freaked out the market open saying the US “fundamentally may need to move toward a system without drug rebates, where PBMs and drug companies just negotiate fixed-price contracts.”
As we await the Medicare Communications and Marketing Guidelines (MCMG), The Centers for Medicare & Medicaid Services (CMS) released the 2019 Model Marketing Materials which includes standardized outreach and educational materials for Medicare Advantage Plans, Medicare Advantage Prescription Drug Plans, Prescription Drug Plans, and 1876 Cost Plans.
I am in the midst of helping to sell a family member’s house. The house was recently remodeled and looks amazing in the realtor posting. An offer came in for full asking price, and we are now in the inspection phase of the process. This is where things get real. The buyers have an “options clause,” which is an opportunity to walk away from the sale if things aren’t as they expected. One of the inspections showed some foundation damage that if not fixed will result in the sale falling through – and for good reason, as the buyers want a house in good working order.
As more and more health systems and provider organizations successfully manage the shift from patient care to population health management, long-term health plan strategic planning should be blending network strategy with product strategy as a key indicator of the ability to achieve clinical and financial goals. The majority of providers are savvy at managing pay for performance and upside risk arrangements, and as providers have seen the margins narrow and plateau, plans have had to adapt and move beyond simple incentivizing for behavior change. We heard from the Centers for Medicare & Medicaid Services (CMS) the Accountable Care Organizations (ACOs) with upside-only risk have not performed as well or increased savings in comparison to those ACOs with downside risk and skin in the game. Systems that have ventured into managing downside risk and percent of premium arrangements and that have been successful have an appetite for more. Certainly moving up the food chain from a provider to a payer has been a topic of conversation among CEO’s of large integrated delivery systems. They have worked hard to align physician trust and referral networks, build a strong name brand in their local communities, and negotiated contracts with health plans that have met and exceeded care and cost containment goals, and the question of where do we go from here is top of mind.
Though Congress is on recess, health care policy was very embedded in conversation, with the Department of Health & Human Services (HHS) officials making their rounds at speaking engagements. Through the speeches and chats with reporters, we have learned some insights into the agenda moving forward for the remainder of 2018. Some takeaways:
Within the Final Rule, the Centers for Medicare & Medicaid Services (CMS) confirmed the reinstatement of the Open Enrollment Period (OEP), which allows a one-time enrollment election from January 1 – March 31 beginning in 2019. For those of us who have been in Medicare Advantage (MA) for a while, we may have had a few déjá vu moments with this announcement (or was that just me?). When we start really thinking about the reinstatement of the OEP, we may be tempted to dust off those old OEP strategies. However, from our perspective, reemploying old strategies would be a mistake. For new plans, or those new to MA, who have never been through an OEP, there is even more to consider from a strategic perspective. While we wait for the Final Medicare Marketing and Communication Guidelines, as well as the Enrollment Guidance, which will tell us where the OEP will fall in the hierarchy of enrollment periods – here are some things to start thinking about: