|Radiology Digest: News from the week of December 5, 2023.
Cigna, Humana ‘In Talks’ to Merge
By Jakob Emerson | November 29, 2023
The Cigna Group and Humana are “in talks” to merge, The Wall Street Journal reported Nov. 29.
According to the report, the two organizations are discussing a stock-and-cash deal that could be finalized by the end of 2023.
A merger between Cigna and Humana would create one of the largest healthcare companies in the U.S. and become a rival to other health services giants such as UnitedHealth Group, Elevance Health and CVS. On Nov. 29, Cigna’s market value was about $83 billion and Humana’s was about $62 billion.
The WSJ report comes after Reuters reported Nov. 6 that Cigna is exploring a potential sale of its Medicare Advantage business.
According to Cigna’s third-quarter earnings report, the company had 599,000 Medicare Advantage members as of Sept. 30, a small portion of Cigna’s 19 million total insurance members. Humana is the second largest Medicare Advantage carrier in the country with 5.9 million members as of Sept. 30. UnitedHealthcare is the largest at 8.1 million.
Cigna’s total revenue in the third quarter was $49 billion. The company projects year-end revenue of at least $192 billion. In the third quarter, net income was $1.4 billion. Evernorth revenue rose 8.1% in the third quarter to $38.6 billion. The insurance side of the business, Cigna Healthcare, reported third-quarter revenue of $12.8 billion.
Humana’s total revenue in the third quarter was $26.4 billion, up 16% year over year. The company reported $832 million in net income and raised its 2023 individual Medicare Advantage membership growth expectations by 35,000, predicting to add around 860,000 members in 2023, or 19 percent more than in 2022.
The possible merger comes as antitrust regulators in Washington, D.C. have recently expressed concerns with healthcare consolidation among hospitals and payers. Andrew Forman, deputy assistant attorney general for the Justice Department’s antitrust division, said at an October conference that the department is ramping up its post-merger investigations and will look into attempts to illegally monopolize healthcare markets.
Cigna and Humana discussed a potential merger in 2015, according to the WSJ. In 2017, a proposed merger between Cigna and Elevance Health, formerly Anthem, was struck down in the courts. A proposed merger between Humana and Aetna was also struck down the same year. Aetna was then purchased by CVS Health in 2018.
To read more, go to Becker’s Payer Issues.
Lawmakers Seek to Ban Fees that Cost Hospitals Millions
By Giles Bruce | November 28, 2023
A bipartisan group of U.S. representatives introduced a bill Nov. 28 that would ban fees on electronic healthcare payments that cost hospitals millions of dollars.
The No Fees for EFTs Act would outlaw payers from tacking on fees for providers to be reimbursed electronically. The ACA required payers to offer electronic payments to providers, but payers and middlemen charge as much as 5% for the transactions, a practice exposed in August by ProPublica.
“Fees associated with electronic transactions for physician services are an unnecessary and costly burden on providers and patients,” the bill’s author, U.S. Rep. Greg Murphy, MD, R-N.C., said in a Nov. 28 news release.
“Greedy health insurers attempt to scalp doctors and patients every step of the way throughout the care process to line their pockets. We don’t tolerate paying fees to receive direct deposit of a paycheck, likewise, doctors and patients should not be forced to pay predatory fees on electronic payments on essential health services.”
The American Hospital Association said it supports the bill, as the fees are “essentially forcing hospitals to pay money to get paid.”
“Our doctors and hospitals in small and rural areas are already struggling to provide timely care without having to factor in the even greater administrative burdens and fees brought on by electronic fund transfers,” Rep. Mariannette Miller-Meeks, MD, R-Iowa, said in the news release.
To read more, go to Becker’s Health IT.
Surviving the Radiologist Shortage: Experts Discuss Private Equity and Other Options at RSNA 2023
By Marty Stempniak | November 27, 2023
Is private equity investment a panacea for healthcare organizations in rural and remote areas grappling with radiologist shortages? Imaging experts discussed this possibility, along with other alternatives, during a session Sunday, Nov. 26, at RSNA 2023.
Some of the statistics are stark: 136 rural hospitals shuttered between 2010 and 2021, according to one estimate. And another 600 such institutions (or 30%) are at risk of closing due to their financial instability. Vital to their communities, these hospitals continue to grapple with low financial reserves, inadequate revenues to cover costs, poor payer mix, and shortages of radiologists and other professionals.
Catherine J. Everett, MD, MBA, with industry giant Radiology Partners, highlighted private equity’s potential role in supporting rural health. Such investor-backed platform companies may be able to mitigate the loss of imaging services in these communities, providing added support to help smaller practices navigate today’s challenges.
“Rural healthcare delivery is in trouble and private equity may have a role in supporting it,” Everett, who is president and managing partner of Coastal Radiology Associates in New Bern, North Carolina, told attendees.
“Large scale radiology organizations can mitigate the loss of rural radiology services and practices. It doesn’t necessarily have to be private equity, it could be a large medical center … or even a large radiology practice,” she added.
To explore how a small practice might benefit, Everett discussed the “theoretical example” of a radiology practice she called “Scotch Bonnet Imaging Associates.”
The group serves three hospitals including a 300-bed flagship, a 150-bed hospital and a 50-bed extremely rural hospital. Leaders there realized the following plusses (with added caveats):
1. Infrastructure: Advanced IT platform
2. Support personnel and operations
3. Best practices + quality and safety
4. Radiology support
To read more, go to Radiology Business.
UnitedHealthcare, Cigna Face Lawsuits Over Alleged Automated Claims Denials
By Jakob Emerson | November 27, 2023
UnitedHealthcare and Cigna Healthcare are facing lawsuits from members or their families alleging the organizations use automated data tools to wrongfully deny members’ medical claims. The allegations come amid broader ongoing conversations among policymakers around insurers’ use of algorithms and artificial intelligence when processing claims or prior authorization requests.
A lawsuit was filed against UnitedHealthcare on Nov. 14 in a federal court in Minnesota by the families of two deceased Medicare Advantage members. The families allege their relatives were wrongfully denied coverage of medically necessary post-acute care by UnitedHealthcare through the use of an AI-powered algorithm called nH Predict. The algorithm was created by naviHealth, a care management company acquired by Optum in 2020.
The lawsuit alleges the algorithm predicts how long a patient will need to remain in skilled nursing care and overrides physicians’ determinations for the patient. The plaintiffs claim UnitedHealth set a goal to keep skilled nursing facility stay lengths for MA members within 1% of nH Predict’s estimations. Employees who deviate from the algorithm’s estimates are “disciplined and terminated, regardless of whether a patient requires more care,” the lawsuit alleges. When decisions made by the algorithm are appealed, they are allegedly overturned 90% of the time.
The naviHealth Predict tool is not used to make coverage determinations, an Optum spokesperson told Becker’s.
“The tool is used as a guide to help us inform providers, families and other caregivers about what sort of assistance and care the patient may need both in the facility and after returning home,” the spokesperson said. “Coverage decisions are based on CMS coverage criteria and the terms of the member’s plan. This lawsuit has no merit, and we will defend ourselves vigorously.”
The Cigna Group is also facing lawsuits from members and a shareholder following a ProPublica report that alleges the company uses an algorithm to deny large batches of members’ claims without individual review, thereby denying them coverage for certain services.
In March, ProPublica reported that Cigna may be violating state laws by allowing its medical directors to deny large batches of claims without reviewing individual members’ files using an automated claims review process called PxDx. The report said Cigna physicians denied more than 300,000 claims over two months in 2022 through the system, which equated to 1.2 seconds of review per claim on average.
In California, two Cigna members filed a class-action complaint against the insurer in July over the alleged issues. Many states, including California, require physicians to review patient files and coverage policies before denying claims for medical reasons. The July complaint claims Cigna bypassed those steps using the PxDx tool.
Following the ProPublica report, state insurance commissioners and federal lawmakers publicly raised concerns and requested more information from Cigna about the process, with some calling for an investigation. In Pennsylvania, lawmakers have introduced legislation that would require payers to disclose how they use AI in claims review, citing the ProPublica report.
To read more, go to Becker’s Payer Issues.
With an Uncertain Labor Market and the Rise of AI, RSNA President Says Radiology Faces a ’10x Force’
By Chad Van Alstin | November 27, 2023
The theme of this year’s annual Radiological Society of North America meeting is “Leading Through Change” and the opening remarks from RSNA president Matthew Mauro, MD, emphasized that, although the shifting nature of radiology work is scary, it’s also a “necessity” to drive improvement.
With the rise of new point-of-care imaging techniques, artificial intelligence, and an “unstable labor market,” radiology is facing a “10x force” akin to a hurricane as it manages a series of existential crises. But, Mauro said embracing change and good business sense will help imaging practices to weather the storm—and come out stronger on the other side.
“For many of us, medicine satisfies a calling—a desire to help others. But in today’s world, medicine is also a business. As physicians, we are in the business of helping people and our business is impacted by the same rules and forces that effect other businesses,” he told attendees Sunday, referring to patients as “customers” and calling for practices to be mindful of the need to provide excellent service.
Mauro said staying competitive by doing quality work is vital as interventional radiology moves away from referral-based operations. The “power of future competitors” has reshaped what it means to work in imaging, as more challengers emerge, taking image-guided interventions away from the specialty. But, he noted that embracing the changing landscape has helped interventional radiology to elevate itself to specialty status and better manage patient expectations—and as education catches up with the evolution of technology, practices have weathered the storm.
However, to remain on the cutting edge, Mauro reiterated the need to improve the happiness of radiologists and imaging technologists, who often struggle with burnout.
“Chairs, chiefs and group presidents are often the last to know when a high degree of frustration exists in a practice,” he said. “We need to do a better job of listening to our people on the front line.”
The rise of AI
As always, AI is a central focus of the conference, with new research being revealed, vendors showing off the latest tech, and RSNA itself sponsoring AI-related competitions. So, Mauro seemed to be asking the question on everyone’s mind: “As technology gains power, what does the future hold for radiologists?”
Calling AI another “10x force,” he believes the rise of machine learning presents an opportunity to improve the lives of providers “freeing the radiologists to devote their time to the more enriching aspects of our work.”
To read more go to Radiology Business.
Medicaid in the Headlines: 7 Recent Updates
By Rylee Wilson | November 24, 2023
New research found the number of self-pay patients increased as enrollees lost Medicaid coverage, and Georgia lawmakers are mulling a full expansion of the state’s Medicaid program.
Here are seven Medicaid updates Becker’s has reported since Nov. 14.
1. The Medicaid improper payment rate significantly decreased from 2022 to 2023, CMS reported. The improper payment rate in the program was 8.58%, or $50.3 billion, in fiscal year 2023, down from 15.62% in 2022.
2. The percentage of self-pay patients increased for emergency department, hospital and primary care visits starting in April 2023, when states could begin terminating Medicaid coverage, according to a study from Epic Research.
3. Half of states are “failing” amid the Medicaid redeterminations process, according to the NAACP. Here are the 25 states that received “F” ratings on NAACP’s scorecard.
4. Georgia Republican lawmakers heard testimony on possible Medicaid expansion for the first time in a decade.
5. Tennessee has extended three managed Medicaid contracts with UnitedHealthcare, BCBS and Elevance’s Amerigroup for one additional year. The extension comes after some Republican state legislators, including House Speaker Cameron Sexton, pushed to award Centene a Medicaid contract following the company’s failure to win one during the state’s previous bidding process in 2021.
6. At least five states are considering adding coverage of weight loss drugs to their Medicaid program, according to KFF. Medicaid directors in Illinois, Massachusetts, New Mexico, Utah and Vermont indicated in their responses to a KFF survey that they are considering adding coverage of some form of weight loss drug.
7. Aetna Better Health of Kentucky CEO Paige Mankovich is zeroing in on improving specific disease states and building health at the community level. Ms. Mankovich sat down with Becker’s to discuss Aetna Better Health of Kentucky’s quality strategy and top priorities for 2024.
To read more, go to Becker’s Payer Issues.
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