From Tom's Desk



"Five Star" Ratings Now Worth Less

The recently passed Omnibus Budget Act of 2018 contained myriad Medicare Advantage provisions.


One may give you pause.


It decreases the value of your high STAR rating---the one you worked so hard to achieve.


The greatest benefit of a high STAR rating isn't the additional revenue you receive from the bonus payment---it's the fact that highly rated plans can sign up beneficiaries year-round, without having to wait for the open enrollment period.


And just which beneficiaries would those highly rated plans sign up?  After all, beneficiaries who "age in" to Medicare can sign up within a few months of their birthdays, no matter what month of the year it falls on.



Those high performing plans would have the privilege of signing up those patients left without coverage once the contracts of low-rated plans were terminated by CMS.


If your STAR rating was low, if you were a low-quality plan, CMS was supposed to be able to terminate your contract with Medicare Advantage---leaving your former beneficiaries free to sign up with the higher quality competition.


That's what the STAR rating was supposed to do, encourage the flow of patients from high rated to low rated plans.


Well, never mind.



The omnibus legislation gave low-performing plans a 10 years extension to improve their quality scores before CMS pulls their plug.



10 years---so essentially never.


The return on capital for all of the money invested in STAR ratings just took a big hit.



Sure, "Five Stars" is an effective marketing gimmick---and it goes a long way towards encouraging new beneficiaries to choose your plan.



But new beneficiaries are only part of the story.  If your Medicare Advantage Organization only grows at the rate new beneficiaries are aging in, then you're really limiting your potential for outsized returns.



As you allocate your resources in the upcoming year, looking for the greatest return, remember that Congress just took a big chunk of change out of your pocket.



The STAR ratings and their objective monetary worth can and will change.




I suggest you invest in systems that Congress can't modify without fundamentally altering the Medicare Advantage program.



Clinician education, physician alignment, improved specialty access.


Consider these.


The return on those investments will always be high---no matter what budget bill is passed.


You Should Know...



The Good News:  Special Needs Plans Are Here To Stay.

The Omnibus Budget Act did more than provide longer-term visibility for low performing plans---it did the same for those plans looking to emphasize Special Needs Plans (SNPs).


We've discussed in this space earlier this year that CMS is gradually changing its RAF calculations to shift more resources to low income and disabled beneficiaries.


One strategy to take advantage of this shift was for Medicare Advantage Organizations (MAOs) to go hard into SNPs, which use Federal waivers to create plans attractive to and more beneficial for the dual-eligible and the disabled.


But those waivers have been temporary---until now.


The omnibus bill made them permanent, so MAOs don't have to worry that their hard work in benefit design and marketing will go to waste.


Even before the omnibus, MAOs were doing great work, creating SNPs with fantastic benefits, funded by the shifts in resources through RAF recalculation.


Now with the long-term stability of these offerings secure, look into them.


I took care of dual-eligibles with wrap-around Medicare Advantage benefits for almost two decades. I found that, despite fears of higher costs, these patients actually bonded with me more easily than regular Medicare Advantage patients. That meant lower care costs and, now even higher net revenue.



Taking care of the underserved is THE growth opportunity in Medicare Advantage today. And SNPs are your tools to prosper---while doing a good thing.


Use them.

High-Value Insight


Aspiration Pneumonitis

Is your patient aspirating when they eat?


Did your patient choke on their own vomit when they were intoxicated?


Are they symptomatic?

Did you treat them?


Then you may be able to increase your monthly capitation for that patient by more than 60%.


Just remember J69.0, Aspiration Pneumonitis.


Use it appropriately.


Document your thought process behind making the diagnosis---swallow studies are not required, but clinical history and interventions (or refusal of intervention) are.

Think about all your elderly patients, your nursing home residents, those with severe chronic illnesses.

All are at increased risk for aspiration


It's a rich source of additional revenue to help you take care of your patients.

And it's one of those codes that's key to outsized success.

Q&A with Dr. Tom

My coder, my auditor, and my Medical Director are always pointing out what "HCC" my diagnostic codes are in.


How important is it that I know this and pay attention to it?


It's not.


Not at all.


It's just one more detail to get caught up in, to distract you from what really generates revenue.


Taking good care of your patients and submitting the proper risk codes.


"HCC" is shorthand for "Hierarchical Condition Codes".  It refers to the coding system where the financial benefits of some diagnostic codes cancel out others---or even add-on. 



Forget about it.  Spend no time on the concept.  The financial adjustments will take care of themselves


  1. Amass a patient panel of a reasonable size
  2. Take good care of them.
  3. Watch for the risk-codes that only you can identify as their PCP.


And prosper with fulfillment and joy.


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