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March 21, 2014
Commercial Market & Health Insurance Exchanges
©2013
! Increased to 4.24 M thru Feb ! 3.3M Through Jan
> 38% State Based Marketplace: 1.6M > 62% Federally Facilitated Marketplace: 2.6M
! 25% ages 18-‐34 (young invincibles) ! 45% male; 55% female
Overall Enrollment
©2013 3
Enrollment by Metal Level
Bronze Silver Gold PlaSnum Catastrophic
18% 63% 11% 6% 1%
Bronze Silver Gold PlaSnum Catastrophic
15% 66% 10% 5% 4%
Overall Enrollment by Metal Level
Young Invincibles by Metal Level
©2013
! Financial Assistance > 83% of Marketplace enrollees are receiving financial assistance – 81% State Based; 85% Federal Facilitated
> 74% with financial assistance selected a Silver plan
! Without Financial Assistance > 26% Silver plan > 30% Bronze plan
Marketplace & Financial Assistance
©2013
! Marketplace closes ! Off-‐Exchange enrollment ! Small group roll-‐in
> Adding to the risk pool > Mandate postponed & revised again
! SHOP making it’s début ! Looking to next year
> TransiMonal policies conMnue > Fall ElecMons > Open Enrollment: Nov 15 through Feb 15
The Rest of the Enrollment Story
©2013
Regulatory Requirements
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©2013 7
ComparaSve Summary of Risk Adjustment Models
MEDICAID COMMERCIAL MEDICARE
Funding Budget
Plan Revenue Impact
Risk Model
New Enrollee Timing
Payment Structure
Risk Pools
Scoring Requirement
Submission Protocol
Score Timing
Audits
State budget neutral;
Affects future reimbursement
ACG(4); CRG(1); CDPS(18); MRX(6); ERG(1); DxCG(1)
Varies 3-‐6 mos
ProspecMve; Aggregate
Varies by aid category
Diagnosis codes; pharmacy
Varies by state
Annual; Semi-‐annual
Limited Annual
Annual by April 30
CMS XML format on Edge server
Paid claims diagnosis codes + procedures codes
Community; metal level
Concurrent; aggregate
Immediate
CMS Commercial HCC; except MA
Funds transfer between plans
Government unappropriated; Plans subsidize one another
Government funded; Balanced to FFS
No downside to underesMmate RAF
CMS HCC/Rx HCC; ESRD
12 mos
ProspecMve; Individual
Community; InsMtuMonal, ESRD
Diagnosis codes
Jan/Mar/Sept
Sporadic RADV
RAPS submission; Encounters soon
ICD-‐10
Ouch!
©2013 8
ACA – MA RADV Comparison Commercial
ACA RADV Medicare MA RADV
Commercial ACA RADV
Medicare MA RADV
Audit EnSSes
• MulMple independent IVA’s may be cerMfied • SVA may be CMS or designee
CMS; contracted to HMS
DocumentaSon Enrollment, medical record,
claims Medical
record only
Audited data
All risk adjusMng data: HCC + demographics + claims (poss)
HCC only DocumentaSon per enrollee
• IVA requires yet unspecified qty of records per enrollee; • SVA uses IVA docs, no addiMonal records submiied
Up to 5 in rank order of best
Sample Data
Criteria
• De-‐idenMfied Edge data • 1/3 w/o HCC’s
CMS data; 12 mos MA enrollment
Sample Size 200 per issuer per state for
2014-‐15
201 enrollees
Sample • 9 strata: age bands & risk level; 1 strata wi/o HCC’s • Uses issuer actual data
• 3 risk levels • Uses issuer actual data
DOS/Provider Match
Appears to be a criteria Not
required
CalculaSng error rate
• Error = any change in risk score • By the IVA • Finalized by the SVA: IVA/SVA comparison
Issuer submits docs to CMS, CMS calculates
ApplicaSon of Error rate
• Applied to each issuer’s plan in the state; • ProspecMve year’s funds transfer formula adjusted;
Individual at issuer level
Non-‐compliance
• Default error rate (highest poss) • Civil penalMes: issuer & IVA • Fraud prosecuMon
Funding Issuer funds IVA CMS
©2013
! Select one or more IVA’s by March 31 each year ! Validate IVA qualificaSons: cerSfied coders, HIPAA, ! Akest to the absence of conflict of interest
> Issuer financial ownership, material interest, board/leadership, family
> IVA has no role in any “relevant internal controls or serve in an advisory capacity related to the RADV
> Obtain equivalent aiestaMon from the vendor ! Fund the IVA audit ! ParScipate in mulSple states if applicable ! Cross walk de-‐idenSfied sample to enrollee data, source enrollment and medical records
! Securely provide data to IVA ! Establish and manage IVA Smeframes
9
Issuer Requirements
©2013 10
RADV & Funds Transfer Timing
! Two-‐year cycle ! ProspecSve adjustment to funds transfer
Yr Operations Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec2014 2014 Benefit Year
2015 Benefit Year
2015 Data ActivitiesRec Funds
Chg/Pay 2014 data
2015 Audit ActivitiesSubmit IVA to CMS
Receive 2014 Sample
Begin 2014 SVA
2016 Benefit Year
2016 Data ActivitesRec Funds
Chg/Pay 2015Adj for 2014
RADVSubmit 2015 IVA to CMS
Receive 2015 Sample
Begin 2015 SVA
2014 Benefit Year
2016 Benefit Year
IVA 2015 Data: results to CMS Dec 1
2015
2016
2016 Audit Activities
Finalize Edge server 2014 data
IVA 2014 Data: results to CMS Dec 1
SVA 2014 DataSVA 2014 findings
& appeals
Finalize Edge server 2015 data
2015 Benefit Year
©2013
! Data Accuracy ImperaSve > Validates ALL data related to the risk score calculaMon:
demographics, health status and possible enrollment and claims
> De-‐idenMfied sample requires reliable common files > DOS and provider matching – precision claims processing > OperaMonal planning: correct all errors
! IVA documentaSon selecSon process cannot be underesSmated
! Financial projecSons for funds transfer formula ! Plan for addiSonal scruSny
> Enrollment > Subsidies > False Claims Act prosecuMon
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ACA-‐RADV Process CauSons
©2013
! Risk Adjustment > Focus on aspects not included in RADV; plan type is risk
adjusMng, renewal data, plan size ! Reinsurance
> Targeted contributors: Enrollment counts, covered lives and payments
> Targeted issuers: plan eligibility, claims (Edge data) ! Risk Corridor
> Robust audit (protecMng federal funds) aligned with MLR audit
> ValidaMon check for enrollment and premiums on the Edge server
> Targeted contributors (est 1%); Targeted issuers (est 5%)
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Other Audits
©2013 13
Audit OperaSons Checklist FuncSon Risk & RADV Vulnerability OperaSonal ConsideraSons
Edge Server Data
• Correct all errors • De-‐idenMficaMon crosswalk • Claim-‐DOS Match
Create pre-‐validaMon rules
Enrollment • Availability of data • Grace period • Plan changes
Include enrollment audit with retrospecMve process
Claims Systems
• Custom business rules • Void/replace process; parMal denials • Interim bills • ICD-‐10 conversion
Incorporate into Edge server pre-‐validaMon rules
Risk Adjustment
• Enrollment Mming • ICD-‐10 transiMon • Supplemental data submission
Assume assessments and retro charts are audited; delete codes & linked supplemental data
Providers • ICD-‐10 TransiMon • Chart retrieval volume • DocumentaMon accuracy
IncenMves for chart access; Provider panel evaluaMon
Finance • Audit funding • Funds transfer projecMons
Crack open the piggy bank
Compliance • Audit staffing Evaluate internal resources
©2013
! Following established Edge server communicaSons with HHS, issuers are expected to submit quarterly: “complete and current enrollment file and a good faith effort for accurate and current claims files” > TransacMonal process report—issuer required to correct
or accept the rejecMon > CMS expects issuers to proacMvely idenMfy and correct risk
adjusMng claims ! CMS provided interim report
> Preliminary risk scores & aggregated claims for reinsurance
! Issuer response required > Interim report 30 days; > 15 days for final report issued before June 30
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Distributed Data Requirements Clarified
©2013
! Default risk adjustment charge; several opSons proposed > Failure to set up an Edge server > Inadequate Data > PMPM based on a fixed % of the state-‐wide average premium and enrollment based on MLR or risk corridor or “other”
! Supplemental data submission > Delete codes > Linked to a paid claim
15
AddiSonal Distributed Data Requirements
©2013
! Member scoring occurs at the issuer level; > risk scores follow the member within the issuer > Requires adequate re-‐idenMficaMon process > Not linked across issuers owned by the same company
! DOS clarificaSon: must match the enrollment period ! Grace period claims will only be counted if not retro terminated > Create an error workflow for this process
! No change to the geographic cost factor calculaSon ! Small group counSng methodology consistent with SHOP methodology ! Small groups that become large can conMnue in risk adjustment
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Funds Transfer Formula ClarificaSons
©2013
TargeSng Strategy
17
©2013
! Beyond Risk Adjustment: RetenSon and Care Management ! Historically reported diagnoses is NOT enough ! High confidence level important to minimize provider & member abrasion
> Transparent model that is edited based on results ! Supplemental Data
> External data sources based on enrollee demographics ! Pharmacy Data
> 177,000 + NDC’s requires consolidaMon to generic product indicator ! Client Data AddiSons
> Self-‐reported condiMons (health survey) > Third party data, such as underwriMng data > Prior AuthorizaMon data; Care Management data
! Overall model modifiers > Prevalence rates > Chronicity > Code Recoverability; Provider coding paierns
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TargeSng AnalyScs: Data Sources
©2013
AdjusSng PrioriSes for Prevalence
HCC HCC Dx Group Label Weight
Exp Value
HCC HCC Dx Group Label Weight
Exp Value
HDX21 Hematological Disorders 49.8 149.5 HDX21 Hematological Disorders 49.8 149.5HDX39 Severe Respiratory Conditions 40.1 40.1 HDX05 Cancer 25.2 75.5HDX54 Renal Disease 37.7 37.7 HDX39 Severe Respiratory Conditions 40.1 40.1HDX40 Heart Assistive Device/Artificial Heart (G14)33.7 33.7 HDX11 Peritonitis/Gastrointestinal Perforation/Necrotizing Enterocolitis13.1 39.4HDX05 Cancer 25.2 75.5 HDX54 Renal Disease 37.7 37.7HDX07 Protein-‐Calorie Malnutrition 14.8 14.8 HDX23 Addiction (G09) 3.8 34.0HDX02 Septicemia, Sepsis, Systemic Inflammatory Response Syndrome/Shock13.7 13.7 HDX40 Heart Assistive Device/Artificial Heart (G14)33.7 33.7HDX11 Peritonitis/Gastrointestinal Perforation/Necrotizing Enterocolitis13.1 39.4 HDX04 Opportunistic Infections 9.7 29.0HDX48 Arterial Disease 11.9 11.9 HDX53 Aspiration and Specified Bacterial Pneumonias and Other Severe Lung Infections9.1 27.2HDX42 Ischemic Heart Disease 11.9 11.9 HDX15 Arthropathy / Osteopathy (G03) 7.9 23.6
©2013 20
Commercial Risk Adjustment IntervenSon Strategy
• Outreach & Survey • Targeted Appointment Assistance
• Outreach & Survey – mulSple akempts • Appointment Assistance & IncenSve • Retro Chart Review
• Outreach condiSon-‐based • Appointment Assistance & IncenSve • Concurrent Chart Review • Home Assessment (?)
• Outreach & Survey
• Outreach & Survey – mulSple akempts • Appointment Assistance
• Outreach condiSon-‐based • Appointment Assistance & IncenSve • Retro Chart Review
• Outreach & Survey • Outreach & Survey
• Outreach condiSon-‐based • Appointment Assistance & IncenSve
Risk Score Gap
Low M
ed High
PredicSve AnalyScs Confidence Level
Low Med High Supplemental Rx Prevalence & Survey
Messaging Variables • Chronic condiMon • Subsidy • Metal Level • New to the Plan
4%
12%
30%
55% 50% of total populaSon
©2013
! High HCC scores create economic value when the cost of care is managed
! Data accuracy required: enrollment, claims, edge server ! Enrollees with high costs and missed HCC’s cause economic loss
! ACA-‐RADV has material impact > Provider documentaMon and claims processing is criMcal > Expect annual adjustments
! ICD-‐10 ! Increased reliance on the provider
> Provider claims processing—for risk adjustment and audit
> Provider documentaMon—for audit purposes > Provider coding errors—affects risk adjustment and
audits
Managing the Funds Transfer Formula
21
©2013
! Managing mulSple risk models: Medicare, Medicaid, Commercial
! Market changes > Medicare, Medicaid, Commercial volume increases > New commercial market risk adjustment
documentaMon requirements ! Limited resources ! EMR impact to billing and risk scores ! TransiSon to ICD-‐10 will
> increase edits/denials > decrease claim volume and coding accuracy
! ICD-‐10 for Risk Adjustment
22
Provider ConsideraSons
©2013
! Edge server data transformaSon > Adjust infrastructure to capture new required data elements > Assess impact of data erosion and errors > Evaluate custom claims adjudicaMon business rules
! Outreach Campaigns > Cross funcMonal outreach strategy: risk adjustment, retenMon,
uMlizaMon ! Analyze historical Commercial PopulaSon
> Begin looking for data gaps ! Provider financial impact planning & Engagement Strategy
> Provider panel analysis ! ICD-‐10 risk adjustment planning ! Establish RADV compliance and operaSons teams ! Reinsurance claims monitoring ! Prepare care management teams based on new plan benefits and populaSon demographics
Take AcSon Now
23
