While 2023 marked one of the most active regulatory years in recent history for the healthcare industry, 2024 is shaping up to be equally as challenging as many of the recent changes impacting payers kick into full gear in the new year.
The driving force behind many of the regulatory changes is CMS’s push to accelerate the digital transformation of the health insurance industry, similar to what CMS did nearly 15 years ago with the acute and ambulatory provider segments with the Health Information Technology for Economic and Clinical Health (HITECH) Act. Let’s take a closer look at five major regulatory requirements that are sure to keep payers on their toes in 2024.
1. Transparency in Coverage
Originally announced in 2020, the Transparency in Coverage Act has continued to expand in scope and reach over the past several years. As of January 1, 2022, payers were required to make pricing data on all items and services, for both in-network and out-of-network providers, made available in a format that computers could read, called Machine Readable Files (MRFs) free of charge. In 2023, CMS mandated that cost-sharing information be made available. By January 1, 2024, payers must provide cost-sharing information for all items and services available to members.
Transparency in coverage was a heavy technical lift for many payers. But those who are on more modern core administrative processing systems (CAPS), like HealthRules® Payer, have been able to leverage HealthEdge’s APIs and tools, such as the company’s Price Comparison Tool, to meet the regulatory requirements with ease.
Transparency in coverage was a heavy technical lift for many payers. But those who are on more modern core administrative processing systems (CAPS), like HealthRules® Payer, have been able to leverage HealthEdge’s APIs and tools, such as the company’s Price Comparison Tool, to meet the regulatory requirements with ease.
Making pricing data available in a consumer-friendly format and driving engagement with members who want to “shop” can be viewed as both a challenge and an opportunity in 2024.
- The challenges center on making the data easy for the everyday person to search for and understand, and presenting an accurate, real-time picture of each specific member’s cost-sharing responsibilities. For example, the system needs to say, “You are covered, and because it is a screening service, there will be no cost to you,” or “Because this is a diagnostic procedure, and because you have not met your deductible, there will be a cost of $X to you. There is a huge potential for members to become confused and highly frustrated, driving more calls to the support centers and contributing negatively to member satisfaction. Payers who depend on HealthRules Payer and HealthEdge Source benefit from an integrated solution called Payer-Source that delivers higher levels of accuracy because the responses are based on the negotiated rate and the claims data instead of just the negotiated rate.
- For forward-thinking payers, this creates endless opportunities to strengthen member engagement with those coming to their websites and member portals to “shop.” In 2024, these payers will seek to optimize this online shopping experience to inform members of missed screenings and vaccinations, promote healthy behaviors, and encourage more member responsibilities, all contributing to HEDIS scores and Star ratings. HealthEdge products and services support the needs of the portal through the real-time ability to provide personalized cost-sharing data specific to the member’s benefit plan, benefits used, and provider(s) selected.
While interoperability is not a new topic within the healthcare industry, a wave of proposed rules focused on facilitating the exchange of health data between patients, providers, and payers are proving to be formidable challenges for payers dependent on legacy or outdated technology. The proposed rule focuses on the following:
Establishing data exchange standards among patients, healthcare providers, and payers:
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- According to CMS, the proposed policies in this rule will enable improved access to health data, supporting higher-quality care for patients with fewer disruptions. These policies include expanding the current Patient Access API to include information about prior authorization decisions, allowing providers to access their patients’ data by requiring payers to build and maintain a Provider Access FHIR API, to enable data exchange from payers to in-network providers with whom the patient has a treatment relationship; and creating longitudinal patient records by requiring payers to exchange patient data using a Payer-to-Payer FHIR API when a patient moves between payers or has concurrent payers.HealthRules Payer customers can use the advanced set of APIs from HealthEdge to comply with the final rule. Plus, for Medicare Advantage plans, advancing interoperability leads to visibility and exchange of data, which can result in strategies for better outcomes and lower costs, leading to improved Star Ratings.
Improving the prior authorization process through policies and technologies:
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- The rule requires payers to implement an electronic prior authorization process, which will shorten the time payers can take to respond to prior authorization requests and establish policies to make the prior authorization process more efficient and transparent. The rule also supports the development of standards that payers will follow when exchanging data, making it easier to ensure complete patient records are available when transitioning between payers.The mechanism the rule uses to enforce the mandate will be APIs. More specifically, the proposed rule will require health plans to use a Health Level 7® (HL7®) Fast Healthcare Interoperability Resources® (FHIR®) standard Application Programming Interface (API) to support electronic prior authorizations. By providing standards that all health plans must use, it is likely that in the long run, the rule will be more effective. HealthEdge’s robust API enables payers to meet all the interoperability standards and facilitates adherence to emerging prior authorization requirements.
2. Advancing health equity and improving access to care:
CMS recently released an updated framework, called CMS Framework for Health Equity, for further advancing health equity, expanding coverage, and improving health outcomes for its more than 170 million individuals supported by CMS programs. The framework sets the foundation and priorities for CMS’s work, strengthening its infrastructure for assessment, creating synergies across the healthcare system to drive structural change, and identifying and working to eliminate barriers to CMS-supported benefits, services, and coverage. There are five health equity priorities that CMS has stated for this new framework that is focused on reducing health disparities:
- Expand the Collection, Reporting, and Analysis of Standardized Data
- Assess Causes of Disparities Within CMS Programs and Address Inequities in Policies and Operations to Close Gaps
- Build Capacity of Health Care Organizations and the Workforce to Reduce Health and Health Care Disparities
- Advance Language Access, Health Literacy, and the Provision of Culturally Tailored Services
- Increase All Forms of Accessibility to Health Care Services and Coverage:
Previously, the health detriments and outcomes data primarily included geography/zip code and gender. Now, requirements include capturing and measuring health equity data such as gender, race, ethnicity, sexual orientation, gender identity, social, economic, and geographic area.
CMS strives to improve its collection and use of comprehensive, interoperable, standardized individual-level demographic and social determinants of health (SDOH) data, including race, ethnicity, language, gender identity, sex, sexual orientation, disability status, and SDOH.
Payers who depend on HealthEdge’s GuidingCare care management platform are already capturing this information to get a more holistic view of their members. Others who are using outdated technology will continue to struggle.
Introduced in 2021, the No Surprises Act was designed to protect consumers against surprise medical bills from out-of-network providers and high health plan cost-sharing policies. It has evolved over the past several years, and that trend will continue in 2024. In fact, on October 27, 2023, a rule was released proposing new processes and policies related to the Federal independent dispute resolution (IDR) process operation. This proposed rule would serve to expedite the processing of disputes by certified IDR entities. Read the Federal IDR Process Operations Proposed Rule to learn more about the proposed requirements. A fundamental piece to avoiding surprise billing is the ability for payers to maintain complete and up-to-date provider data directories. HealthEdge is delivering on its commitment with its new Provider Data Management solution (PDM).
4. Changes in Star Ratings for Medicare Advantage Plans
According to a 2023 article in Modern Healthcare, “Earlier this year, the Centers for Medicare & Medicaid Services (CMS) announced several changes to Medicare Advantage that will take effect in 2023. The changes aim to advance CMS’s vision for health equity, drive comprehensive, person-centered care, and promote Medicare affordability and sustainability. They include updates to Medicare Advantage capitation rates, Part C and Part D payment policies, and Star Ratings.”
Changes in the way Star ratings are calculated are of particular interest to health plans because Star ratings are directly tied to CMS bonuses payments and incentives. They are designed to reflect the quality of care a health plan delivers, and a large portion also reflects a patients’ experiences with health plans. By doubling the weight placed on the member experience for Star ratings, CMS is encouraging payers to focus on improving the member experience.
Data collected in 2024/2025 will greatly impact 2027 Star Ratings. With HealthRules Payer, payers can run modeling in 2024 to project their 2027 outcomes and develop corrective adjustments. The combination of HealthRules Payer and Guiding Care, along with the open APIs on the HealthEdge platform, provides payers with a comprehensive platform that can help them identify necessary adjustments that must be made now before these new calculations take effect.
More details of the Star rating changes planned in 2024 can be found in this fact sheet posted on the CMS website.
The Bottom Line
Regulatory trends will continue to push payers to accelerate their digital transformation journeys in 2024. Modern technology solutions from HealthEdge, along with the company’s dedicated team of regulatory specialists, are helping more than 100 payers to prepare for and optimize these regulatory changes to create competitive advantage and greater business insights.
To learn more about HealthEdge, visit www.healthedge.com.
