Medicare Advantage Poses Significant Challenges for Providers. We're Addressing These Head On.

Contributed by Judson Ivy , Founder, President and CEO at Ensemble Health Partners .

I want to be very clear: When it comes to contract negotiations with payers, we’re not stopping at “good enough.”?

Medicare Advantage (MA) plans in particular have been an ongoing challenge for providers. The goal of the MA program was to cost less. It never has.??

In fact, the government will likely spend $83 billion more on Medicare Advantage beneficiaries in 2024 than it would if they were beneficiaries of fee-for-service Medicare.?

Not only do these plans cost taxpayers more, they pay hospitals less than traditional Medicare. Here at Ensemble, we view it as a critical part of our mission to help close the reimbursement gap for hospitals and health systems working with these plans.?

It’s been an uphill battle for providers. When we raise issues about the performance and payment of MA plans, payers typically only offer concessions on the commercial side, with no change to MA rates.??

Since these commercial plans are largely funded by employers, these commercial rate increases mean they’re okay with impacting the employer’s money, not their own. MA plan performance continues to worsen, unchecked, while employers are essentially subsidizing that poor performance with increased contracted rates. It’s not sustainable.?

We’re willing to keep pushing.?

Ensemble works with industry organizations, including state and national hospital associations, as well as with state lawmakers and congressional leaders to provide data that helps shine a light on issues plaguing providers. We also take direct action on behalf of our clients:??

• Aim high: We’re working to enforce the Two-Midnight Rule, get MA plans to pay for the 340B retro decision and encourage providers to reduce the number of MA plans they participate with in order to gain leverage for the provider.??

• Get paid what you deserve: We also push our clients to demand the rates they deserve from the MA plans — rates in excess of 100% of Medicare. This isn’t a cash grab; it’s a necessary action to try and land close to 100% in aggregate after all the denials and downgrades occur. We’ve seen success in this arena, and it’s our clients that feel the benefit.?

• Ask for what you need: During negotiations, we support our clients in pushing for specific language. Experiencing significant delays in discharge due to a lack of MA plan network adequacy, an issue not facing traditional Medicare patients? A contractual request for language of a per diem around delays is absolutely appropriate.??

Just because payers draw a hard line on these things doesn’t mean they’re not the right course of action for providers. They are, and we’re not backing down.??

The status quo isn’t good enough.?

Our expert operators at Ensemble are ready and willing to challenge all those past agreements that have somehow become the established standard for facilities. As the saying goes, “the most dangerous phrase in our language is ‘we’ve always done it this way.’”??

Providers can’t afford to adhere to a rapidly diminishing status quo. In the long term, neither can payers.?

Still, there’s often pushback from providers — after all, payers, with their vast resources and singular focus, have traditionally had the upper hand when it comes to setting rates and negotiating terms.??

Providers, who by necessity are dependent on payers for reimbursement, have long been hesitant to rock that boat. And, historically, the Managed Care departments of healthcare organizations have played a tactical role rather than a strategic one — yet a strategic approach is absolutely critical here. ?

The revenue cycle is one major lever providers can move to reclaim power in this off-balance payer-provider dynamic. By investing in a strong rev cycle partnership and pursuing every dollar that is owed to them, providers can feel confident that their revenue cycle will drive value instead of adding additional costs — or risking losing out on reimbursement that’s rightfully theirs.???

Providers must work to minimize friction, but be willing to take a stand.??

Our clients recognize the stakes. Many are willing and prepared to go out-of-network if a payer won’t yield to requests for reasonable terms. To be clear — this action isn’t an empty threat, or a decision providers make lightly.??

But the reward is worth the risk — and in this case, the reward is a provider that can afford to keep its lights on, its staff paid and patients treated with the care and dignity they deserve. We see this play out every day.??

On behalf of our provider partners, Ensemble has secured more than $1B in settled disputes with payers. Our clients have seen rate increases two times higher than the industry average. We’ve partnered with hospital associations to implement new provider-friendly state regulations around issues like additional documentation requests and subsequent denials, limitations to offsets from providers, and prompt payments.??

We’ve pushed for these changes, and we’re now seeing them reflected in provider manuals and contracts that will positively impact provider reimbursements for years to come. And here at Ensemble, we’ll continue to push for providers to get their fair share — now, and for as long as this imbalance with payers remains the status quo.?