With Medicare Advantage enrollment continuing to rise and more plans offering more benefits than ever, big changes are coming in 2021. Below, we’ll outline key changes to Medicare Advantage plans in the next year, explain program updates due to the COVID-19 public health emergency and offer advice on how to navigate billing and reimbursement concerns.
For the first time in history, Medicare Advantage penetration has reached 40% of the total Medicare-eligible population. Currently, 25.4 million people are enrolled in Medicare Advantage (MA) plans, with a total Medicare-eligible population of 62.4 million, according to the Centers for Medicare and Medicaid Services (CMS).
With an aging population, enrollment in Medicare Advantage plans will only continue to grow: the Congressional Budget Office projects enrollment in these plans to rise to about 51% by 2030.
Medicare Advantage is an alternative to traditional Medicare that acts as an all-in-one health plan and is sold by private insurers. All Medicare Advantage plans must provide at least the same level of coverage as original Medicare, but they may impose different rules, restrictions and costs.
CMS has clearly stated a goal to move from the current fee-for-service models toward value-based care. While the Medicare Advantage population grew by 60% from 2013 to 2019, the fee-for-service Medicare population only grew by 5%. The progress Medicare Advantage plans have achieved essentially creates an ideal marketplace for beneficiaries. Enrollment costs are down and more plans than ever are offering new, innovative benefits. But what does this mean for providers?
Key takeaways for Medicare Advantage plans in 2021:
- Medicare Advantage enrollment in 2021 is expected to continue to increase to a projected 26 million.
- The three biggest changes coming to Medicare Advantage plans in 2021 are:
- The expansion of telehealth services and coverage. Data indicates that in 2021, over 94% of Medicare Advantage plans will offer additional telehealth benefits reaching 20.7 million beneficiaries, up from about 58% of plans offering telehealth benefits in 2020. In March of this year, CMS released detailed plans to waive or reduce cost sharing for telehealth services.
- Expanded coverage options for long-term care (e.g., adult day programs, in-home personal care services, benefits for over-the-counter products, home safety modifications including grab bars for bathrooms, wheelchair ramps and stair rails, and meal delivery and transportation).
- More coverage options for people with end-stage renal disease (ESRD), however, according to the Better Medicare Alliance, if certain states have a significant number of patients with ESRD, Medicare Advantage plans in those areas are likely to be underpaid and could be forced to raise consumer costs, reduce supplemental benefits or limit services for all enrolled beneficiaries.
- The maximum out-of-pocket limit for Medicare Advantage plans will increase to $7,550 for 2021.
- A standard plan’s maximum deductible is increasing to $445 in 2021, and the threshold for entering the catastrophic coverage phase (where out-of-pocket spending decreases significantly) is increasing to $6,550.
How has COVID-19 affected Medicare Advantage plans?
The COVID-19 stimulus package, the Coronavirus Aid, Relief and Economic Security (CARES) Act, includes $100 billion in new funds for hospitals and other healthcare entities. The Centers for Medicare and Medicaid Services (CMS) made $30 billion of these funds available to healthcare providers based on their share of total Medicare fee-for-service (FFS) reimbursements in 2019, resulting in higher payments to hospitals in some states than in others, according to KFF. Hospitals in states with higher shares of Medicare Advantage enrollees may have lower FFS reimbursement overall. As a result, some hospitals and other healthcare entities may be reimbursed less that they would if the allocation of funds considered payments received on behalf of Medicare Advantage enrollees.
In response to the COVID-19 emergency, many Medicare Advantage insurers waived cost-sharing requirements for COVID-19 treatment, meaning Medicare Advantage beneficiaries will not have to pay cost sharing if they require hospitalization due to COVID-19 (though they would if they are hospitalized for other reasons).
If a vaccine for COVID-19 becomes available to the public, Medicare is required to cover it under Part B with no cost sharing for traditional Medicare or Medicare Advantage plan beneficiaries, based on a provision in the Coronavirus Aid, Relief and Economic Security (CARES) Act.
How providers can prepare for a Medicare Advantage boom
As MA continues to ramp up, the most successful providers will be those who work with a revenue cycle management partner that understands the nuances of Medicare reimbursement as well as the added complexities of MA.
With the acquisition of eSolutions, a leader in revenue cycle technology with Medicare-specific solutions, Waystar is the first technology to unite commercial, government and patient payments onto a single platform, solving a major challenge and creating meaningful efficiencies. Billing Medicare, Medicare Advantage and commercial claims from a single platform eliminates the hassle of managing multiple revenue cycle platforms and allows providers to get deeper AI-generated insights for faster reimbursement and increased value—for their organizations and their patients.