Provider complaints about Medicare Advantage plans, specifically prior authorization, have reached a low roar. Our operating thesis right now is that plans, especially those in a weaker market position are using prior auth and denials to slow walk claims through 4th quarter. Some plans, it would appear, are not priced for the higher utilization and costs we see emerging here in the back half.
Some providers have had enough already and Becker's has documented hospitals and systems that are ending relationships with plan sponsors. No surprise, these hospitals are not generally found in the best MA markets. The question is how far and wide this dissatisfaction might spread. Off course it depends but on a few things. As we have noted, the change in the Part D benefit is going to make stand alone PDP plans less attractive to plans sponsors, causing them to limit their offerings and pushing enrollees away from Traditional Medicare toward an MA+PDP plan.
The desirability of an MA plan is going to be driven by its network. A network arrangement in a period of stubbornly high inflation, touchy labor relations and a generally sicker populations, is going to argue for the assumption of less risk, not more by providers.
Growth in enrollment of MA HMO plans has faltered recently. While MA enrollment is running about 8%, HMO is growing around 6%. Our anecdotal surveillance suggests providers are quitting HMO networks, especially in robust markets, but not necessarily the PPO network or MA more generally.
This trend suggests that the Value-based era may have been killed off by the Public Health Emergency, at least for now.
Let me know what you think. As always, here to help.
