Giants in the insurance industry oppose a CMS plan to make public data that inform how Medicare Advantage costs are set, saying the information could raise premiums and affect competition. Experts say the concerns are more about payers' bottom lines.
In July, the CMS proposed a rule to release bid-pricing data submitted by plans interested in offering Medicare Advantage plans.
The information could show how healthcare is used in different regions and by different populations.
The CMS proposes releasing the data every year. That data will it be at least five years old and exclude any proprietary information—all efforts to address concerns about stifling competition. Comments on the rule were due Sept. 6.
Medical-loss ratio data that are 18 months old would be made public. For Medicare Advantage plans, the Affordable Care Act created a MLR of 85%. That means at least 85% of revenues must be used toward claims and quality improvement activities.
The information could be misinterpreted or misused, Anthony Mader, vice president of public policy at Anthem, wrote in a comment letter.
The information is now not even available under a Freedom of Information Act request as it's considered information that if made public, could harm market competition, Mader added.
Humana is particularly concerned with sharing county-level cost and spending data.
“Presentation of data at that level would essentially make provider rates transparent to all providers,” Heidi Margulis, senior vice president, corporate affairs at the company said in a letter.
The federal government recognizes that when health care providers do not know each other's prices, they are more likely to offer lower unit prices to ensure they are not excluded from networks, Margulis said.
The Blue Cross and Blue Shield Association, a national federation of 36 plans, questioned CMS' motives for releasing the data since there is some out there and there hasn't been a push for the information CMS wants to release.
“We don't see a high demand from the research community for new data today—rather we think the interest might be among a few academics who would like the data for negative reasons and/or competitors for bid data for the areas they might be exploring for expansion,” said Justine Handelman, vice president, legislative and regulatory policy at the association.
Cigna also was against any proposal that would allow for the calculation of negotiated rates by service category and market, such as the average payment paid for a particular service.
Providers could use this information during future contract negotiations with MA plans, said David Schwartz, head of global policy at Cigna Federal Affairs.
“The proposal therefore could reduce competition and innovation in markets, leading to higher costs and reduced access to high quality MA plans and services for current and future beneficiaries,” Schwartz said.
Industry experts, however, are cynical of payers' concerns.
“This effort by CMS is consistent with a lot of other efforts at the state and federal level to provide more upstream transparency about provider and carrier rates, the ultimate goal of which is to reduce high outlier prices and squeeze out excess margin,” said Katherine Hempstead, a senior adviser at the Robert Wood Johnson Foundation.
Providers, likewise, support the proposal.
“Release of such information will improve the public health by facilitating research on the utilization, safety, effectiveness, quality and efficiency of health care services,” Dr. James Madara, AMA's CEO, said in a comment letter.
