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  • President Joe Biden’s administration has requested state TennCare officials to make major revisions to the Medicaid block grant program. This program currently provides healthcare to 1.6 million Tennessee residents.

    Under the block grant program, Tennessee would receive a set amount of funding but have more flexibility in how they spend it. This will enable the state to retain savings for health care and health-supporting initiatives.

    State and Federal officials have been discussing these revisions for quite some time. The state has the option of approving or rejecting the changes, as this is a request from the federal government. Furthermore, Tennessee has until August 30th to decide if revisions will be made to the TennCare program. The benefits of 2021 will be preserved in the meantime.

    How Revisions Can Affect Tennessee Residents

    Some experts from Tennessee say that the revisions to the waiver grant program would be beneficial and is good news for Tennesseans. Organizations like the American Heart Association, the American Cancer Society, and many others opposed the granted waiver because of the harm it would do to 1.6 million Tennessee adults and children who rely on TennCare. Michele Johnson, Executive Director of the Tennessee Justice Center says, “all the groups warned it would damage the health care system on which we all depend and would worsen the rural health crisis across Tennessee.”

    On the other hand, by requesting the waiver in 2019, Tennessee Gov. Bill Lee’s administration hoped to save money by directing those funds into health care initiatives and programs. This was followed by a year of criticism from GOP lawmakers who did not want to expand the Medicaid program under the previous Affordable Care Act. By the beginning of 2021, the waiver grant program had finally been approved.

    Under Medicaid, the federal government pays two-thirds of TennCare’s costs. There are no spending caps on state Medicaid expenditures which means Tennessee could boost or even expand the existing TennCare programs if it wishes. Depending on how much more of its own money the state was willing to put into it.

    The Center for Medicare and Medicaid Services is recommending these other provisions:

    • The Center for Medicare and Medicaid Services’ letter states it supports Tennessee’s policy goals to expand coverage and benefits. But the letter says center officials propose that “instead of the current framework for savings and investment,” the federal agency will “work with the state on necessary expenditure authorities to meet common goals.”
    • Modify the waiver’s specific terms and conditions section to “more explicitly state” Tennessee cannot cut benefits or coverage in effect from Dec. 31, 2021, without a procedural amendment subject to an additional public comment period and Center for Medicare and Medicaid Services approval.

    How GMS Can Help

    GMS does more than offer coverage like a traditional medical insurance company. To help our clients find the right coverage solution, we offer a variety of tools and resources including:

    • Education- In addition to a dedicated benefits specialist, you gain access to a team of experts who can train employees on how your plan works and answer questions.
    • Guidance – Health insurance is complicated. Our experts provide guidance on how to best utilize your plans, maintain compliance, and stay on top of Affordable Care Act regulations.
    • Control – GMS gives you more control of your business. Partnering with a PEO for group health insurance lets you focus on growing your business while making your benefits administration more efficient.

    To learn more, contact us today!

  • Medicaid is undergoing a major expansion in the state of North Carolina. The bill, H.B. 149, was passed on June 2nd by the North Carolina Senate. This bill will expand Medicaid eligibility, allowing more than 600,000 North Carolinians to receive the life-saving health care they need. In addition to the Medicaid increase throughout the state, the bill contains a certificate-of-need (CON) law that expands nurses’ practice authority.

    The Importance

    One of the major attributes of passing the bill comes from the continued rise of inflation within the U.S. Over the past year, North Carolina has been overwhelmed by the increasing healthcare costs. Senator Ralph Hise, R-Mitchell addressed, “Everything is going up. But with the sector of cost rising farther than anything else, and that has been true for decades, is healthcare; and it’s not even close.”

    Hise mentioned several other factors that support the need for Medicaid in North Carolina:

    • Eight years of solid Medicaid budgets
    • Republican leadership in the General Assembly
    • Reform of the system associated with the Medicaid transformation in 2021

    What It Means

    Over the past year, North Carolina has ranked third in the nation for hospital closures. The bill further pushes insurance companies to cover telehealth visits, along with providing medical billing transparency. Patients must be notified at least 72 hours before a procedure or visit if they have an out-of-network provider.

    The bill also contains the SAVE Act, allowing nurses to practice without a doctor present. Senator Lisa Barnes, R-Nash Stated, “It’s a measure that doctors’ groups have opposed but is targeted to rural areas where staffing shortages have reduced access to health care.”

    How GMS Can Help

    GMS supports your business by ensuring you stay ahead of all legislative changes. As a result of the expansion of Medicaid, there will be various changes throughout the healthcare industry. At GMS, a benefits specialist can find a healthcare plan that gives your employees access to what they need. Contact us today to get started!

  • A recent article written by the Wall Street Journal  outlines some startling financial data in regard to our domestic health insurers and their cryptic billing process established by CMS (Center for Medicare/Medicaid Services). Although GMS typically focuses on the private insurance markets—as they are the most relevant for businesses—examining the continued failures of CMS may provide some insight as to why our domestic healthcare system operates so poorly and why prices for both public and private health insurance markets are sky-rocketing.  

    Costs associated with the U.S. healthcare system. 

    A Look into the Market’s Rising Prices

    Medicare is a socially-funded program meant to provide health benefits for tax-paying citizens age 65 and older and permanently-disabled individuals of all ages. Medicare, a majority of the CMS which also splits some funding with state and federal Medicaid programs, is typically divided into four parts, coined Medicare parts:

    • A (Hospital insurance)
    • B (Supplementary Medical insurance)
    • C (Medicare Advantage)
    • D (Medicare prescription drug benefit(s)) 

    Medicare is funded primarily by tax-payers and Medicare subscribers who are required to pay a monthly premium to utilize the benefits provided through CMS policies.

    What most citizens don’t know is that CMS is the largest buyer of healthcare policies in the world and files enough fraud, waste, and abuse statistics to land itself within the Fortune’s 500 top 50 based solely on the amount of money lost each year. That’s right, the fraud waste and abuse of Medicare in 2017 was enough to top revenue for entire organizations like Best Buy, Disney, and Fed-Ex. The figure also dwarfs the full budgets for programs like Homeland Security, the EPA, and NASA by tens of billions of dollars, if not more. 

    As astonishing as those statement may be, these trends have continued almost every quarter, year, and decade since 1965:

    Healthcare loss trends. 

    Contributing to this $60 billion eyesore is an antiquated billing system that largely remains confidential. What the WSJ highlighted (and what we’ll continue to discuss for the remainder of this article) are the overpayments made to Medicare Part-D insurers for inaccurate estimations of cost for upcoming fiscal years (FY). As detailed above, Part-D handles the Rx benefits for Medicare subscribers and is interestingly administered 100 percent by private insurers. 

    These “overpayments” surpassed the $9 billion mark from 2006-2015 and were paid out to private insurers on top of existing revenue for administering these Part-D plans. The question as to how $9 billion seemingly slipped through taxpayers’ hands and into the revenue stream of top-insurers is what’s intriguing… or maybe infuriating is the right word to use here. 

    The Bidding Process for Private Insurers

    In order to address that question, we’ll need to take a brief look into the bidding process for these private insurers and how re-payments by CMS are made on an annual basis.

    Every summer Part-D insurers send detailed cost-projections for what it would take to fund all Medicare Part-D subscribers’ prescription costs for the following year (about 40 million people). These projections are split into two main categories: Direct Subsidies and Reinsurance Subsidies.

    Direct Subsidies contain projections for the majority of services through Part-D. When insurers submit these bids and real costs fall below what was originally projected, CMS allows insurers keep a portion of the difference. Keep in mind that these “projections or bids” are what Medicare bills to taxpayers to ensure proper coverage. In this case, insurers are seemingly incentivized to inflate their bids (by an obvious but overlooked billing loophole) knowing they’ll get to keep some of what isn’t used by the Medicare Part-D population while taxpayers get to bear the financial brunt of these egregious errors. 

    Reinsurance Subsidies are siloed for Medicare subscribers that have extremely high-costing medications. These high-costing medications, sometimes referred to as “specialty” meds, can often times be upwards of $5,000 for a 30-day supply. Humira, a popular drug that’s used to treat Rheumatoid Arthritis among other chronic illnesses and is often advertised on television, will run you about $6,409 for a 28-day supply without applicable medical or prescription insurance. For these subsidies, insurers must pay back any overages in cost projections should they fall above what was actually spent. However, if insurers’ projections fall below what was actually spent, Medicare will fund the remaining amount. 

    Imagine you’re the controlling party for one of these large private insurers. If you could legally receive billions of dollars simply by “over-projecting” one of your bids and legally save billions of dollars by undercutting a different bid with the sum of those earnings or savings being pushed off to the subscribers you’re insuring and American tax-payers, what would you chose? 

    The Grave Reality of the U.S. Healthcare System

    Given the above details, the first question that comes to mind might sound something like this: “So Medicare Part-D allows 100 percent administration of a federally subsidized program by private insurance companies, but also allows said companies to submit their own budget forecasts and allows them to keep some of that allocated money if they’re wrong in creating those budgets?” With an 11 percent error rate in 2016 Medicare payments, it’s not hard to see how this staggering $9 billion figure is only a fraction of what the programs wastes annually. Applying these malpractices to a $3.5 trillion-dollar industry (the United States healthcare system, which is showing steady annual spending growth and will likely eat over 25 percent of the GDP within the next decade) and the grave reality of what’s at stake is easily recognizable. 

    I would highly encourage anyone interested to read more about the WSJ’s findings, but will conclude with the following:

    As the economic epidemic of our healthcare system continues to worsen, it’s articles like this from the WSJ that bring to light how much taxpayer money is truly wasted through an irresponsibly administered system like CMS. The issues found here can be replicated time and time again throughout various programs in our healthcare system and are a big piece of why healthcare costs, specifically insurance premiums, continue to climb. 

    Although it’s not always enjoyable to put these concerning statistics and unsavory business practices in frame for our readers, the transparency that GMS owes to our clientele will always reign. If you’re interested in working with realistic brokers to create modern solutions for your group’s health plan, contact GMS to speak with a dedicated healthcare professional.