The COVID-19 pandemic continues to reshape our world and uncover systemic vulnerabilities across industries. For health care providers, this has been a particularly rude awakening. Previously reliable modeling practices have been turned on their heads, forcing the industry to quickly adjust their processes or sacrifice their bottom line.
According to a study conducted by Avalere Health, only 4% of Medicare Advantage enrollees had at least 1 claim in April, compared to 23% in April 2019. Claims with 15+ diagnoses were cut in half from March 2020 to April 2020. Avalere concluded that Medicare Advantage risk scoring based on current claims could drop between 3%-7%, insinuating a potential loss of revenue totaling hundreds of millions of dollars for a single insurer.
Fee-for-service pre-adjudicated claims for heart disease were down 45%, which puts insurers at risk for higher claims costs due to deferred care for its sickest enrollees. Yet, Medicare Advantage insurers face the risk of their MLRs dropping below 85% in 2021, which means they could get payments recouped from CMS.
It is imperative for Medicare Advantage plans to conduct advanced analysis to project their 2021 payments, as well as improving quality of care for enrollees. These are not easy tasks, but thankfully there are solutions that can help these plans not only survive this climate.
If the threat of COVID-19 affecting your plan’s bottom line has you rethinking your current RAPS and EDPS process or vendor, contact us today. It’s not too late to protect your profitability.