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Budget deal would cut Medicare Advantage bonus payments

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This from FierceHealthcare:

“Buried in the budget deal that Congress passed Friday morning is a provision that will save the government money at the expense of Medicare Advantage plans’ bonus payments.

‘The provision—titled “preventing the artificial inflation of star ratings after the consolidation of Medicare Advantage plans offered by the same organization”—is projected to reduce spending by $520 million over 10 years, according to the Congressional Budget Office.

“The upshot of the new policy change is that when a Medicare Advantage organization consolidates two separate plans, the Centers for Medicare & Medicaid Services will adjust the new plan’s star rating ‘to reflect an enrollment-weighted average of scores or ratings for the continuing and closed contracts.’

”The way the rules work now, insurers can consolidate two plans and have the star rating of the better-quality plan apply to the new entity, according to Politico PULSE. That practice effectively gives insurers a way to boost the quality bonus payments associated with lower-rated plans, hence the provision’s use of the phrase ‘artificial inflation of star ratings.’

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