Medicare Part D and Medicare Advantage Changes for 2013

The Centers for Medicare and Medicaid Services (CMS) has announced that 2013 will bring changes aimed at continuing to improve the quality of Medicare Advantage and Part D plans while helping seniors afford their prescription medications.

The Affordable Care Act Changes to Part D Prescription Drug Plans in 2013

The Affordable Care Act includes provisions that, over time, are reducing the cost of prescription drugs for people who fall into the coverage gap, or “donut hole.” In 2011 and 2012, the discount for brand name drugs was 50%; in 2013 and 2014, it will increase to 52.5%, and will grow after that until it reaches 75% in 2020.

The discount for generic drugs is increasing too; in 2013, it will be 21% so that you will pay 79% of the cost of your generic prescription medications. The generic drug discounts will also continue to increase, until they reach 75% in 2020, with the remaining 25% to be paid by you.

Other changes to Part D plans in 2013 include:

• The standard Part D plan initial deductible will increase to $325 (up from $320 in 2012). Your deductible may differ.
• Premium costs in 2013 are expected to remain at 2012 levels, around $30.00 per month on average. If you see a large increase in your Part D premium, you can make changes during the Open Enrollment Period.

Special Enrollment Period to switch to 5-star rated Medicare Part D or Medicare Advantage plans

CMS developed its quality rating system for Medicare Advantage and Medicare Part D plans a few years ago, basing it on well-established measures of health care delivery quality such as access to care, responsiveness, and beneficiary satisfaction. Plans can earn from 1 to 5 stars.

Although 5 star plans were few in 2012, forecasters are predicting they will be more widely available in 2013 as more insurance companies achieve the service levels necessary to earn the rating.

If you want to switch to a 5-star rated plan in your area, you can do so at almost any time during the year. The Medicare Advantage and Medicare Part D 5-star plan Special Enrollment Period this year runs from December 8, 2012 through November 30, 2013.

Special Enrollment Period to leave a consistently low rated Part D or Medicare Advantage plan

If either your Medicare Advantage or Part D plan has failed to achieve at least a 3 star rating from CMS over the last three years, you should expect to receive a letter from CMS offering you a Special Enrollment Period to leave your plan and choose a new one.

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Exchanges Part 2: What to look for and what to look out for

Why have exchanges? … What’s an exchange? What isn’t?: A Two-Part Blog Series on Health Care Insurance Exchanges

By Brian Bohlig, chief marketing officer
Extend Health – A Towers Watson company

We’ve seen dramatic paradigm shifts for our employer clients and their retirees that come out of combining the power of health reimbursement arrangements and the individual Medicare market through an exchange. Here are some basics tenets that we have found to be differentiators in the value exchanges can offer:

• An exchange is not just a website. There’s a lot more to it. On the back-end, an exchange should seamlessly parse compliant enrollment data to carriers and the state exchanges accurately and laser fast. An exchange should offer robust customer service to help your employees identify the best plans for them.
• An exchange is not just a call center. A lot of the technological advantages of the online environment, like electronically filing enrollments within 24 hours, are lost to your group if your exchange is still working largely by fax or mail.
• Real-time reporting is crucial to making the transition from a group plan to an exchange. If an exchange can’t give you real-time reporting during enrollment, you’re driving blind. Worse yet, your only reporting channel could be hearing from your own group that things aren’t going well.
• A one-carrier exchange is like the sound of one hand clapping. A carrier website that offers only its own plans denies consumers competitive value, denies consumers options if that carrier raises rates and denies consumers a consumer advocacy partner.

At Extend Health, we built our exchange on the pillars of a web interface, back-end support systems and benefit advisors. Unlike many other online shopping experiences, buying health care coverage is one of the most complex and costly ventures people have to deal with in their lives and the quality of what’s picked relative to your health needs is critical. So it’s really important to consider more than just the lowest cost premium.

Despite having invested many millions in our technology platform, we’ve found that there’s no substitute for a knowledgeable helping hand when choosing the best health plan. Extend Health employs hundreds of knowledgeable, licensed professionals who spend time on the phone with our consumers to make sure they’ve considered the important elements of their medical needs, prescription drug needs and lifestyle needs when choosing a plan. Our technical systems set the high bar in the private Medicare exchange marketplace, but our benefit advisors are our secret sauce. They bridge the gap between the technology side and the real-life decision points that go into picking the best health coverage for each individual.

Health insurance exchange checklist

Based on this deep well of experience and development, here’s what you should look for when evaluating a health insurance exchange.

Multiple health insurance carriers	• Provides true choice, price comparison and competition
Intuitive user interface	• Empowers people with robust benefit and price information • Collects key info on medical, prescription and lifestyle needs • Matches key info to the best set of health plans available by ZIP code
Robust back- end systems	• Submits a complete, compliant enrollment application online and fast • Seamlessly transmits data to and from state exchanges
Strong customer support	• Provides a helping hand matching key info to the best plans • Advocates for consumers with carriers on the exchange
Nimble reporting capabilities	• Allows insight into the application process • Gives insight into communications uptake, plan choices and exchange performance

Caveat emptor: If the exchange you’re looking at is missing one or more of these, there are some more serious questions you should be asking.

Keep this list of questions and answers handy when you’re evaluating an exchange partner. See full list: Questions To Ask An Exchange

• Has an employer ever pulled out of your exchange during open enrollment?
• What percent of enrollment applications are you still submitting on paper, either by fax or mail?
• Do you offer real-time reporting on call wait times or during the enrollment application process?

At Extend Health, we have set and raised the bar on end-to-end exchange technology, from our user interface to our back-end and call management systems to our real-time, interactive reporting interface. The first goal of our exchange model and technology infrastructure has always been to make the user experience as smooth as possible – for consumers to choose health plans and for employers who want to increase options their employees’ options while managing health benefit costs.

There’s a world of uncertainty out there and you don’t want your employees or retirees to be the beta testers of a fledgling exchange. Arm yourself with these questions and know what you’re walking into.

For regular commentary on developments and trends in health care, insurance, and technology, follow @brycewatch and @ExtendHealth on Twitter and check out https://www.extendhealth.com.

Related articles

• 2011 Global Brand Simplicity Index, Siegel+Gale
• How-health-care-exchanges-will-work , Gerald Kominski, UCLA’s health policy research director explains the market aspects of how health insurance exchanges could function
• Private Health Insurance Exchanges and Defined Contribution Health Plans: Is It Déjà Vu All Over Again?, Paul Fronstin, Ph.D., Employee Benefit Research Institute
• Sebelius Releases Proposals for Minimum Requirements for State-Run Health Insurance Exchanges; Extend Health CEO Bryce Williams Offers “Four Keys To Building An Effective Health Insurance Exchange,” Extend Health

Read part one in this two part series: Exchanges Part 1: Everyone wants in

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Exchanges Part 1: Everyone wants in

Why have exchanges? … What is an exchange? What isn’t?: A Two-Part Blog Series on Health Care Insurance Exchanges

By Brian Bohlig, chief marketing officer
Extend Health – A Towers Watson company

You wouldn’t call it a stock exchange if only one company was selling shares on it, right? It’s easy to see how that kind of a market would benefit the company selling on it – buy my product and forget the rest.

But how does that help consumers?

As a corporate or government employer or professional/trade association, you should be asking this question if you want to offer employees /members – present or retired – health care coverage through an exchange.

What you find when you look under the hood of some of exchanges might surprise you, because some models aren’t set to drive all the value and savings organizations and consumers  aspire to when making the transition from a group health insurance plan to the individual market.

Why an exchange?

The reason for exchanges in the first place is to help get a handle on an industry known for its complexity and high costs. A nimble exchange has the potential to slice through health care and insurance industry complexity and costs with:

• Apples to apples comparisons – Putting comparable plans from different carriers beside one another so consumers can make sense of the benefit differences.
• Transparency – Showing pricing, not just of medical plans but also helping assess out-of-pocket costs consumers could see down the road based on prescription medication needs, the kinds of doctors they see and where.
• Objectivity – A system that doesn’t promote certain plans for non-consumer-oriented reasons, like commissions, or for the administrative ease of the exchange itself.
• Cost-savings – By making it easy to compare plans side by side, it creates a competitive environment where consumers can pick the least expensive plan that meets their needs best.

Extend Health has been running an exchange for eight years. In 2005, when the Medicare Modernization Act did for Medicare insurance plans what health care reform is doing for everyone else now, we set up the first real private Medicare exchange  – an exchange that gave retired employees of our employer clients access to the individual Medicare plan market – an exchange that moved beyond the one-size fits all structure of employer group plans. We enrolled retirees from our first employer, Chrysler, in 2006.

Today we offer the largest number of carriers – over 75 and counting, serve the largest number of employer clients – over 175 (40+ Fortune 500s) and counting, and the largest number of consumers who have selected individual Medicare plans through our exchange – over 200,000 and counting.

Since Extend Health became a Towers Watson company back in May and the Supreme Court ruling upholding health care reform, many clients, retiree, reporters and others in the health care industry have been asking us about exchanges and what to expect.

At this pivotal point in the evolution of health care in our nation, Extend Health is in a unique position. Features of the Medicare environment, like guaranteed issue and standardized plans, are being applied to the rest of the U.S. health care environment. And we have deep, long-standing measures and knowledge about how consumers, employers and carriers have fared on the Extend Health exchange.

In the next post of this series, I share what experience has taught us about what to look for and what to ask when you’re considering an exchange.

For regular commentary on developments and trends in health care, insurance, and technology, follow @brycewatch  and @ExtendHealth on Twitter and check out http://www.extendhealth.com.

Related articles

• 2011 Global Brand Simplicity Index, Siegel+Gale
• How-health-care-exchanges-will-work , Gerald Kominski, UCLA’s health policy research director explains the market aspects of how health insurance exchanges could function
• Private Health Insurance Exchanges and Defined Contribution Health Plans: Is It Déjà Vu All Over Again?, Paul Fronstin, Ph.D., Employee Benefit Research Institute

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

CMS announces 500 participants in Comprehensive Primary Care initiative

On August 22, 2012 CMS Announced 500 primary care practices that will participate in the Comprehensive Primary Care (CPC) demonstration project in a new partnership between payers and primary care providers. Backed by the ACA, the goal of this multi-payer initiative is to deliver better coordinated, higher quality, patient-centered care, and to reduce costs.

The CPC’s goal was to enroll about 75 primary care practices in several regions spanning eight states: Arkansas, Colorado, New Jersey, New York, Ohio & Kentucky, Oklahoma, Oregon. Practices were chosen in a competitive process based on several criteria.

• Use of health information technology
• Ability to demonstrate recognition of advanced primary care delivery by accreditation bodies
• Service to patients covered by participating payers
• Participation in practice transformation and improvement activities
• Diversity of geography, practice size and ownership structure.

The chosen practices are to begin delivering health care services under the program in the fall of 2012, and are projected to serve over 300,000 people with Medicare. For more details and a complete list of participating primary care practices visit the CMS Innovation web site and read the CMS press release.

Sources:

http://www.innovations.cms.gov/initiatives/Comprehensive-Primary-Care-Initiative/index.html

http://www.cms.gov/apps/media/press/release.asp?Counter=4434&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date

http://www.innovations.cms.gov/Files/fact-sheet/Comprehensive-Primary-Care-Initiative-Fact-Sheet.pdf

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

New BenefitView Dashboard Lets Employers Track Retirees’ Medicare Enrollment Progress

The newly available Extend Health BenefitView™ dashboard lets employers ensure no retiree is left behind during the enrollment process. BenefitView gives employers access to something they’ve never had before on a Medicare exchange: real-time, interactive reporting on the experience of their retirees as they transition from the employer’s group coverage to their own individual Medicare plans on an exchange.

In “Retiree Medicare exchange previews improved transparency,” Employee Benefit News sheds light on how valuable this degree of insight is to HR professionals leading their companies and employees through a health care benefit transition this significant.

BenefitView is the culmination of eight years of our insight into delivering a premium health insurance exchange experience for consumers and employers on the Extend Health private Medicare exchange.

BenefitView answers burning HR questions

BenefitView offers employers immediate answers to questions around goals and milestones when transitioning from a group plan to the individual Medicare market:

• Have retirees responded to our communications?
• Are their calls to benefit advisors getting through in good time?
• Are they making and completing their appointments with benefit advisors?
• How long are those calls taking on average?
• Are they choosing plans and which ones?
• Are there groups that we may need to do additional outreach to?

BenefitView gives employers up-to-the-minute, unfiltered answers to these questions with the click of the mouse.

BenefitView users and creators tell us what they think

We talked to representatives from a few of the employers who have used BenefitView for mid-year transitions. Here’s what they had to say.

“Before our transition started, we wanted to make sure our retirees first understood that they were going to get more choice and control over their Medicare health benefits. Then we wanted to provide retirees with all the right information they needed to participate,” said Melissa (Missy) Hartfiel, benefits planner, Global Compensation and Benefits for International Paper. “With BenefitView, we can instantly see all the data on our progress – the number of retirees contacted, the number of calls and enrollments completed, how quickly our retirees were being answered, and the length of those calls. This inspired a lot of confidence in the Extend Health solution. As a non-techy, I also appreciated that BenefitView is visual and easy to use – there was no learning curve and I got all the data I wanted with one click.”

“The data HR professionals see in BenefitView is the same data that Extend Health sees in-house,” said David Lash, senior director of product management for Extend Health. “This actually makes our weekly progress meetings with employers much more strategic. We don’t have to spend time communicating numbers or determining where we are in the process. We’ve been looking at the same numbers all along and we are able to focus our energy on optimizing the course for each phase of the transition. It’s much more efficient for everyone. More than the technology involved, our goal for this tool was to create this premium experience for employers.”

“Employers sponsor and subsidize these transitions of their retirees to individual plans to assure that every retiree gets a chance to have the supplemental Medicare coverage they want while managing company costs and future liabilities,” said Brian Bohlig, chief marketing officer for Extend Health. “It’s very important to employers, to us and most importantly to retirees that these transitions go as smoothly as possible.  Extend Health has always provided employers frequent and comprehensive progress reporting to ensure smooth transitions – but now we’ve made it real time and on demand. BenefitView makes communication between Extend Health and employers seamless, and protects employers from finding out after the fact that their retirees missed out on getting the health care coverage they needed or wanted.”

Another Extend Health client, Oak Ridge National Laboratories, also experienced the difference BenefitView could make in the process of selecting individual Medicare plans. “With BenefitView, I was able to give our HR Director up-to-the minute progress reports whenever she asked for them,” said benefits manager Scott McIntyre. “As we neared the end of our enrollment period, we were checking BenefitView daily and adjusting our communications and outreach to make sure we were giving all of our retirees every chance to participate. BenefitView allowed us to keep our finger on the pulse of what was happening with our retiree transition whenever we wanted.”

BenefitView specifications

Real-time information available to employers through BenefitView includes:

• Number of retirees enrolled versus the total number eligible in time remaining
• Percent of eligible retirees contacted
• Number of appointments scheduled
• Number of appointments met
• Plan types selected across different populations
• Average premiums across different populations
• Number of unique plans selected
• Number of unique carriers selected
• Total number of calls
• Average wait times for before reaching a benefit advisor
• Average time to handle calls

Get a BenefitView demo

Contact Extend Health online or by phone 1.888.232.1653 for a demonstration of BenefitView. Check out BenefitView online yourself.

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Tweet Chat on Health Care Costs

Extend Health held a tweet chat today on health care costs. There were some great questions and excellent answers from John Barkett, Dir. of Policy Affairs at ExtendHealth fielded questions. John worked in congress on health care and his wealth of knowledge was evident in the answers he provided.

If you missed our tweet chat you can read a complete recap of the event. Hope to see you at the next one!

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Way to go Garland Senior Fair!

Extend Health exhibited at the Garland Senior Fair in Texas this past Sat, Aug 4. There was a great turnout of over 350 people from the community and surrounding areas including seniors, their families, community leaders and service providers like us, who care about seniors and senior issues.

State Representative Angie Chen Button thanked Dwight and Ivory in person for exhibiting at the fair, fulfilling an invitation that she extended to Bryce Williams, Towers Watson Managing Director of Extend Health, at the ribbon-cutting of the first Extend Health service center in Richardson this past May.

Richardson Mayor Bob Townsend encouraged everyone to make good use of the resources available. And many other community leaders, including City of Rowlett Senior Advisory Board members Pamela Bell and Wayne Baxter, met with attendees and the community groups and companies exhibiting.

Dwight Turner and Ivory Rooks, both senior benefit advisors for Extend Health, who have years of experience helping seniors choose the best Medicare plans for them, served as Extend Health ambassadors. They answered people’s questions about Medicare and shared resources with them, explaining the role Extend Health can play in helping to connect people with the best coverage for their needs.

According to Dwight, “We put the care into shopping for Medicare!“

Ivory added, “It was great to be able to connect in person with people and extend a helping hand.”

Extend Health contributed a Texas-themed gift basket, which was raffled off to a lucky winner. The day was welcome chance to connect in person with many in a community that is very important to Extend Health.

We recently announced that Extend Health is bringing over 500 jobs to the community with the opening of its second service center in the Richardson Telecom Corridor.

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Extend Health tweet chat on health care reform

Extend Health held its very first tweet chat today. The topic was health care reform, and there were some really great questions – and a bit of humor tossed in too. John Barkett, Dir. of Policy Affairs at ExtendHealth fielded questions. John worked in congress on health care and his wealth of knowledge was evident in the answers he provided.

If you missed our tweet chat you can read a complete recap of the event. Hope to see you at the next one!

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

New from Bryce Williams, “Transparency crucial to empowering health care consumers.”

Here’s an excerpt from a new post just published on Bryce Williams’ blog “Watch This,” on the need for transparency in health care pricing:

“Knowledge is power — the power to think, to act, to buy, or even to not do any of the above. Our nation’s health insurers and health care providers need to figure out how to put power back into the hands of consumers. Consumers today have too many constraints when it comes to accessing decision-critical information about the cost of health care. That’s a hard pill to swallow when there’s so much at stake.”

Read the full post on Watch This.

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare insurance exchange.

Summary of trends: HHS’ Bundled Payments for Care Improvement initiative

Back in August of 2011 we wrote  about a new program from the U.S. Department of Health and Human Services (HHS) called the Bundled Payments for Care Improvement initiative that would allow multiple providers to bundle payment for services a patient receives for a single “episode of care,” such as heart bypass surgery or a hip replacement. The program was designed to incentivize health care providers (hospitals, doctors, clinicians, etc.) to work together to reduce costs and provide better care. As part of our ongoing interest in measures to reduce health care costs, we’re posting this summary of trends in bundled payments.

Bundling payments is not a new idea. The first large scale CMS pilot of bundled payments was Medicare’s Heart Bypass Center Demonstration that ran from 1991 to 1996. It saved Medicare over $42 million and saved patients nearly $8 million. It also improved the quality of care and lowered hospital mortality.

Health Care Incentives Improvement Institute (HCI3) recently released a report titled Bundled Payment Across the U.S. Today. They found that the most common reasons for choosing a procedure or condition to bundle are based on cost, how easy it is to define and implement the bundle, and how it aligns with existing initiatives. In the future, bundles may also be influenced by those adopted by Medicare.

Procedural inpatient conditions like hip and knee replacement make good bundle candidates because they are easy to define and standardize. Chronic conditions like diabetes are more difficult to bundle than procedural conditions, but offer the greatest opportunity to generate savings by bundling. Among bundles created by providers and payers in the HCI3 study, there were few for outpatient procedures and none for acute medical conditions.

Bundles are defined by the services include, the time period covered, and patients included.  After defining the bundle, payers and providers negotiate its price. Defining a bundle is complex and can take a great deal of time and effort for providers and payers to analyze and come to an agreement on the final definition. Bundle rates can be defined as risk-adjusted or flat-fee; risk-adjusted rates vary with the severity of the patient’s condition, while flat-fee rates stay the same for every patient.

There are two types of payment bundles, retrospective and prospective, and four broad models for bundling payments. Payers and providers work together to determine the episodes of care and services they want to bundle together based on what works best for them.

1. Retrospective Payment Bundles – Payers & providers set a target price for an episode of care. Participants are paid using the Original Medicare fee-for-service system, and then add an administrative budget reconciliation process at the conclusion of each episode. While some feel this method does not represent true bundled payment, it is used because the technical and administrative infrastructure is already in place for providers and payers. Setting up a “true” bundled payment system would require an expensive investment in changing billing practices. The types of episodes that work for retrospective payment bundles are:

• Model 1 – Inpatient stay in a general acute care hospital
• Model 2 – Inpatient stay plus post-acute care
• Model 3 – Post-discharge services only

2. Prospective Payment Bundles – Payers make a single, prospectively determined bundled payment to the hospital for services furnished. Prospective payment bundles are only available for:

• Model 4 – Inpatient stay only

Payers send spending reports to providers on a monthly or quarterly basis so providers can keep track of the amount spent on the bundle.  Payments must be reconciled at the end of an episode to make sure claims are associated correctly with the bundle. While quality measures were being used in various ways, only one of the participants in the HCI3 study was using them to adjust payment amounts, because it is difficult to find acceptable quality measures that can be directly tracked to spending.

Risk and savings are used to incentivize providers to increase the success of bundled payments systems. There are three types of savings/risk arrangements.

1. Shared savings – incentivizes the provider to reduce spending below the negotiated bundled rate by letting them share in the savings.
2. Shared risk – incentivizes the provider to reduce spending by putting them at risk for costs above the negotiated bundled rate and letting them share in the savings.
3. Full risk – puts the provider at full risk for all costs above the negotiated bundle rate, but allows them to keep all of the savings.

Bundled payments are gaining in popularity, but the volume remains low because of the high number of exclusions negotiated between payers and suppliers, and issues with lack of continuous enrollment. It may be too early to draw any definite conclusions, but there are early indications that bundled payments have delivered some cost savings. Decreased readmissions, complications and mortality have been reported too. Many are using their early experiences with bundled payments to help them prepare for the future and develop new payment and risk-sharing strategies.

Read the HCI3 report

Bundled Payments for Care Improvement, CMS Innovation

http://www.innovations.cms.gov/initiatives/bundled-payments/index.html

Affordable Care Act initiative to lower costs, help doctors and hospitals coordinate care

http://www.hhs.gov/news/press/2011pres/08/20110823a.html

Visit Extend Health to use the ExtendExchange™ platform – the nation’s largest private Medicare exchange.