A second look at underpaid CMS premiums could restore millions

Premium loss due to Medicare Secondary Payer (MSP) has more impact on the financial bottom line of a Medicare Advantage (MA) plan than many people realize. Though MA plans are on the task – attempting to find and correct errors in member eligibility and CMS premium payments – most are still missing millions of dollars due to hidden challenges in the process.

For this reason, any plan could benefit from a supplemental “lookback” at their MSP files to ensure all the bases have been covered and premium revenue has been maximized. This simply means looking back through the plan’s MSP, MMR, and member eligibility files to look for cues that the MA plan is owed additional premium reimbursement for certain members, either because of inaccurate eligibility information or because of a process issue that was unable to correct eligibility information and restore the premium.

The reasons that these cues may have been missed in a first pass are varied and often include:

  • Incomplete data aggregation from the plan’s IT department
  • Section 111 reporting inaccuracies by commercial plans
  • Inability to completely or accurately validate a member’s other insurance
  • Acceptance of ECRS Web denials that should actually result in premium reimbursements

Some of the most common reasons plans are unable to identify or restore underpaid premium are out of the control of the department that is managing MSP validation. Would you even know if your IT department is sending you incomplete data? What if you can’t get another insurer to validate eligibility information for a member? If CMS denies a seemingly legitimate eligibility update, do you know how to overturn that?

Typically, when a MA plan does a “lookback” across its full MSP file, it can expect to see a spike in premium restorations over an initial validation period of about 4 to 6 months, often bringing in millions of dollars in additional premium revenue.  Restorations will then taper off as the plan maintains a best practices MSP program.

Discovery Health Partners provides a supplemental MSP Validation solution that complements MA plans’ internal efforts by doing this lookback for them.  Again and again, we find that even though most of these plans are working diligently to identify eligibility issues and premium reductions due to MSP, every one of them had been underpaid more than they realized.

In fact, in the last three years, we have recovered $150 million in additional premium restoration opportunities across all of our MA clients. These include plans of all sizes and maturity levels:

  • 100,000-member New York area health plan – $24 million
  • 30,000-member Midwestern health plan – $16 million
  • 20,000-member regional plan – $2.1 million

The amount of potential restoration opportunity for a MA plan is a function of five parameters. The variability of these parameters among our clients has resulted in a premium recoupment range of $11 premium per MA member on the low end to $419 premium per MA member on the high end.

  • The number of identified indications of other insurance on file with CMS for the plan’s MA members
  • The percentage of inaccurate records successfully validated
  • The number of months of actual restoration opportunity there is for each incorrect record
  • Average monthly restoration amount
  • CMS acceptance rate of corrections submitted

Check out our newest infographic, which highlights the impressive results MA plans of all sizes have had with a supplemental MSP validation solution that complements their ongoing internal efforts.  You’ll see why using an outside firm to help with this lookback can yield additional premium recoupment at no risk to your plan.

Paul VostersA second look at underpaid CMS premiums could restore millions