From Dr. Tom's Desk

Trends in new industry studies suggest a massive expansion in Medicare Advantage is in the offing. Can you take advantage of the opportunity?
 
The results of yet another huge study touting the benefits of Medicare Advantage were splashed across the healthcare media this past week.  For examples, see here, here, and here. Read more about the details of the study and what lessons you can glean for your practice in “You Should Know” below.
 
The study is pretty standard as these industry-sponsored efforts go, and mostly with the results you’d expect. On the surface it looks like yet another of those observational studies that found cost savings associated with Medicare Advantage coverage.
 
Battlefield preparation for the upcoming open enrollment period---but perhaps something more.
 
A close reading in the context of our times suggests deeper trends, trends that you can profit from if you get ahead of them.
 
Consider:

  • The recent report of the Medicare trustees emphasized concerns regarding the sustainability of the Medicare program, even more so than normal for them.
  • Increasing numbers of insiders scrambling to position themselves on the boards of Medicare Advantage Organizations and their supporting entities.
  • The release of more and more studies such as the one we’re discussing today. They’re increasing in number and size, each trying to outdo the previous one in the appearance of “good” design based on “good” data. The emphasis on cost savings and improved outcomes continue to grow, as does and emphasis on the benefits for the underserved.

I’ve been watching these trends for years, and up until recently I believed that the increase in “research-based marketing” was simply the result of industry growth.
 
I no longer believe it’s just that.  Things are coming to a head.
 
There will almost certainly be big push for a massive expansion in the Medicare Advantage program in the next Congress. It will probably take the form of even broader leeway in benefit design for insurers---leeway that will include greater opportunities for beneficiaries to financially benefit. It will be an expansion that will put traditional Medicare at a big disadvantage.

One year from today, look to the space to check the accuracy of this prediction. I suspect I’ll be writing about it much sooner.
 
And don’t be surprised if a prominent politician, one with strong ”anti-government healthcare“ credentials, embraces a “Nixon going to China” opportunity and goes all in for “Medicare Advantage for All.” They’ll endorse supplanting the current patchwork insurance system, including Medicaid, with a national Medicare Advantage model.
 
You read it here first.
 
Real universal healthcare---using a model that rewards innovation.
 
There are all sorts of implications but overall, that’s an opportunity where everyone can win.
 
And you don’t have to be one of the huge incumbent insurers to do so---you just have to be ready to scale when the race begins.

You Should Know

The study discussed above, though filled with industry shilling, does contain a few gems that can inform your care processes for great success.
 
You can read the results for yourself, here.  Remember, don’t get too carried with the findings, it’s designed to sell insurance and influence public policy, not impartially inform. When you read it in that light, the overstatement of benefits, the potential bias in the study design and the glossing over of data detrimental to the narrative becomes obvious. 
 
Of interest:
 
“Medicare Advantage has a higher proportion of patients with clinical and social risk factors shown to affect health outcomes and cost than FFS Medicare.”

In other words, Medicare Advantage patients have a higher diagnostic coding intensity.  You pay for data, you get more (though not necessarily better) data.
Your lesson:  don’t over-code.  And design your care systems so your costs can withstand a 20% cut in top-line revenue, that’s the amount of money CMS estimates is lost to over-coding every year.
 
Despite a higher proportion of clinical and social risk factors, Medicare Advantage beneficiaries with chronic conditions experience lower utilization of high-cost services, comparable average costs, and better outcomes.”

Efficient care is cost-effective care.  The key is keeping down the expense of delivering that efficient care.  Do you do it with a staff of nurses herding your patients, or do you rely on risk-sharing with your primes?
One’s a cost-center, the other a profit center. Which is better?
Note the study says that while spending on healthcare costs for Medicare Advantage beneficiaries is lower compared to FFS, costs to the government are not appreciably different. If that’s true, it’s an arrow showing CMS exactly how much they can cut capitation rates to achieve the medical loss ratio they believe is appropriate. And when “Medicare Advantage for All” is proposed, that’s partly how it’s going to be paid for.
 
“Health outcomes and cost savings are significantly better for Medicare Advantage beneficiaries with diabetes—the most clinically complex cohort in which more than 75% of beneficiaries had all 3 chronic conditions in both populations—than for FFS Medicare beneficiaries with diabetes.”

The sicker the patient, the greater the short-term benefit of focused, cost effective care.
For whatever reason, this is the hardest point for those clinicians I mentor to accept. The sicker the patient, the greater the opportunity for both you and your patients to benefit.
Don’t shy away from enrolling these patients, embrace them.
You’ll get paid for doing what you do best---and everyone will be a winner
Can telemedicine fill the gap when Samantha loses her doctor?  She learns more than she bargains for trying to keep her family safe. Share her journey.

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