Medicare Advantage plans are making limited use of new supplemental benefit flexibility provided by the Centers for Medicare and Medicaid Services to address the social determinants of health, according to a new study by the Urban Institute with support from the Robert Wood Johnson Foundation.
There are several reasons why insurers aren't taking full advantage. One large driver is the cost of the new benefit. With limited funding available, doing more means eliminating previously provided benefits.
Another is concern about investing in benefits that reach a small number of enrollees and therefore, have limited appeal to a broad group of beneficiaries.
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One interviewee noted, the study said, "You don't want to design benefits that speak to 1% of your population; you try to cover as many [enrollees] as you can." These sentiments were consistent across interviews with MA insurers, the authors said.
Five Medicare Advantage insurers, which were not named and represent 38 percent of the market, were interviewed for the study.
Four out of five did add new benefits or expand existing benefits in 2019 in response to CMS's guidance.
The most commonly added or expanded benefit was meal delivery, reported by three insurers and noted by industry experts as being of great interest to insurers. The next most commonly added benefits were adult day care, improvements to home safety, personal home helpers, and telephone navigator support.
One insurer reported expanding transportation and another added acupuncture and massage therapy.
WHY THIS MATTERS
Socioeconomic and demographic factors are important drivers of health and outcomes. Unmet health-related social needs, including food and housing insecurity, are associated with higher healthcare utilization and spending.
None of the MA insurers interviewed have rolled out nationwide benefits, and many enhancements have been focused on a limited set of beneficiaries or geographic areas, the report said.
To do more, CMS needs to make policy changes and providers need to code for the social determinants, the report said.
CMS only allows benefits to be targeted based on clinical criteria, rather than social needs. One interviewee suggested, "If you really want to be impactful, then you should let your plans use these [benefits] and target these not based on the fact that somebody has diabetes or congestive heart failure, but rather that maybe they're a frequent flyer at the ED [emergency department]."
"The social determinants, with some reasonable guard rails, should be a trigger for a benefit," another said.
Also, reportedly, after CMS released its guidance on the supplemental benefits, the agency rejected some plans' proposals focused more on the social determinants of health.
Those interviewed said providers should be encouraged to use ICD-10 Z codes that document social adversity to help flag patients for targeted interventions. These diagnosis codes document, for example, homelessness, inadequate housing, illiteracy, and extreme poverty. Providers do not currently use these codes consistently, they said.
To participate in the MA program, private plans submit a bid to CMS equal to the expected cost, including administrative costs and profits, of providing Medicare Parts A and B benefits to an average-risk Medicare enrollee in a county. This bid is compared with a predetermined county-level benchmark set by CMS, which is based on traditional Medicare spending in each county.
Plans bidding below the benchmark receive a portion of the difference between the benchmark and their bid as a rebate, which must be used to provide lower cost sharing or supplemental healthcare benefits, like dental and vision coverage, to enrollees.
In April, CMS began allowing MA plans to target supplemental benefits to enrollees by health condition. The new benefits must be financed through the rebates, which on average represent a relatively small amount at $107 per member per month.
In addition, MA plans were already using these rebate funds for other priorities before 2019, so the full rebate amount is not available for new supplemental benefits unless the plans eliminate previously provided benefits
THE LARGER TREND
Traditional Medicare does not cover benefits and services to address beneficiaries' social needs. About two-thirds of Medicare beneficiaries have traditional Medicare, while a third have opted for Medicare Advantage and their numbers are expected to grow.
In 2017, 9.2 percent of Americans age 65 and older had incomes below the federal poverty level, and more than 30 percent of all older adults had incomes less than 200 percent of the federal poverty level. In addition, an estimated 7.7 percent of Americans age 60 and older were food insecure in 2017, and 4.7 percent of Americans age 62 and over experienced homelessness that year.
Though the Medicaid program has increasingly attempted to address beneficiaries' health-related social needs, among Medicare beneficiaries, most of the work to address social needs has focused on limited demonstrations and private plans covering those dually eligible for Medicare and Medicaid.
Industry experts said they expect to see more use of the MA benefit flexibility in 2020. The five insurers interviewed were planning to add benefits though they could share few details because the benefits were still being developed.
Benefits planned or considered for 2020 include pest control, programs to reduce social isolation, palliative care, and dental care for people with certain diseases.
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Focus on Social Determinants of Health
In September, Healthcare Finance News, Healthcare IT News and MobiHealthNews will take a look at the SDOH and how varied health systems, IT companies, Congress and others are addressing it.