Since payment updates for Medicare Advantage plans do little to improve home care providers’ financial well-being, the Centers for Medicare & Medicaid Services should consider better oversight to ensure that the dollars plans receive are actually spent on care, experts recently told McKnight’s Home Care Daily Pulse.
“Realistically, the money that the plans get is not being passed to our members for a variety of reasons,” Mollie Gurian, vice president of home-based and HCBS policy at LeadingAge, said in an interview with McKnight’s Home Care Daily Pulse. “A lot of plans don’t pass that money along. And it just seems like they’re getting more Medicare dollars whereas our providers aren’t [reaping the benefits] from those payment increases.”
This week, the Centers for Medicare & Medicaid Services finalized a 3.7% payment update for MA plans for 2025. While the change is greater than a 3.32% bump that MA plans received for 2024, providers and plans alike quickly criticized the new rate as being inadequate. The rate calculation includes a 0.16% benchmark payment decrease.
When the insurers perceive a pay cut, Gurian said, they may hold more tightly to their money.
“When the plans think that they are not getting the money that they need, that downward pressure will trickle down,” she explained.
‘No very clear enforceable standards’
William Dombi, president of the National Association for Home Care & Hospice, concurred. A major problem is that MA plans are not required to pay providers at a certain payment threshold, he explained.
“It’s not good for those providers when there really are no very clear enforceable standards on what a fair payment rate would be,” he told McKnight’s Home Care Daily Pulse. “This is becoming close to a crisis level of concern because the [MA] enrollments continue to rise and the margins in the traditional Medicare program continue to deteriorate.”
Cost management tool roadblocks
And there are other roadblocks, according to Gurian. Insurers’ cost management tools such as prior authorization, limited networks and high copays often hinder patients’ ability to find and receive care. Providers, as a result, may find their cash flow constricted.
Solutions might be found in greater oversight, Gurian said. Prior authorization reform, which is underway both in Congress and at the regulatory level , could help funnel those Medicare dollars spent on MA back to the agencies providing care.
“[MA plans] are supposed to offer the same benefits that fee-for-service does,” Gurian said. “But because of their utilization management tactics, that has not been the case to date.”
