Habits die hard. In a normal world if UNH announces less than expected or in-line benefit costs, providers should be concerned. We are not living in a normal world. For the first time since probably the 1960s hospital systems have become agnostic regarding insurance source. PPI for Medicaid patients at hospitals has soared almost 7.00% this year, the result of lax oversight of expansion populations and state plan amendments geared for creating or expanding supplemental payments policies - which generally operate outside of the PMPM financing system.
Medicare, however, remains a bit of a problem child which is why it is generating so many health policy headlines. MCOs have pushed patients toward outpatient care and CMS has pushed back. Prior authorization and other automated tools have delayed and denied care, some of it unnecessary. By comparison to other financing sources, Medicare remain much less attractive to providers. With additional layers of regulation, the program has also become a bit of a pain in the neck. Calls for ending or de-prioritizing Medicare participation are growing louder.
Our Medicare model has been frustrated for years by the influx of pandemic cash but started to settle down in 2022. It will be verified by the actuary's report this spring but Medicare inpatient utilization appears to be more volatile than before the public health emergency while still exhibiting similar seasonal variations. That volatility may be an expression of the way in which hospitals sort patients through a resource constrained system. Some health systems are making no secret of their need to de-prioritize Medicare patients. Others are using things like financial qualification to treat serious illness. Gross, I know.
All this is to say that the benefit trend concerns appear to be more of a tussle between the Medicare program as performed in health systems and MCOs, than a systemic shift in utilization.
Emily Evans
Managing Director – Health Policy
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