Session 50 PD, How to analyze your plan’s experience and what it
means for bid planning in the coming year
Moderator/Presenter:
Matthew P. Chamblee, FSA, MAAA, CERA
Presenters:
Puneet Budhiraja, ASA, MAAA
How to Analyze Your Plan’s
Experience and What it Means
for Medicare Bid Planning in the
Coming Year
Puneet Budhiraja, ASA, MAAA
Actuarial Director, Government Programs and Analytics
Agenda
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•
•
•
•
•
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About Capital District Physicians’ Health Plan, Inc. (CDPHP)
Monthly Reports on Net Gain Analysis
Capitation and Shared Savings Programs
Analyzing Historical Risk Scores by Different Cohorts
Utilization and Cost Trends monitoring
Comparing Bid Projections to Actuals
Working with the Consulting Actuary to Prepare Bids
About CDPHP
• Not-for-profit health plan headquartered
Albany, N.Y.
• Physician founded and directed
• 440,000+ members in 24 counties
• Network model of approximately
5,000 physicians and
65+ hospitals
• Offer HMO, PPO, EPO,
and high deductible products
• Self-insured plans
• Government programs, including Medicare Choices HMO
and PPO, MedSupp, Medicaid, Child Health Plus, and Healthy New York
in
Monthly Reports on Net Gain Analysis
•
Linked member monthly report (MMR), Facets
(core claims system/medical claims),
prescription drug event (PDE), member
premium data warehouse at member month
level
•
Help monitor how net gain/loss by plan benefit
package (PBP), county, etc. (all the fields
available in MMR)
•
Help knowing our claims by MSC
•
Develop yearly net gain/loss by different
intervention programs
Summary by Plan Benefit Package by Medical Loss Ratio
CY2014 Summary by PBP
HMO
Contract
ID
PBP
MM
RAFactor
Part C
Revenue
PMPM
Claims PMPM
Loss Ratio
Admin PMPM
Net Gain/Loss
PMPM
Profit
Margin %
Profit Margin
$
H3388
H3388
H3388
1
2
4
34,641
137,912
185,128
357,681
1.009
1.023
0.842
0.928
$855.41
$1,019.90
$824.98
$903.09
$748.67
$900.42
$754.09
$809.99
87.5%
88.3%
91.4%
89.7%
$71.96
$71.96
$71.96
$71.96
$34.78
$47.52
($1.07)
$21.14
4.1%
4.7%
-0.1%
2.3%
$1,204,825
$6,554,218
($197,406)
$7,561,637
H3388
H3388
H3388
801
803
804
3,917
57,583
12,076
73,576
0.756
0.985
0.898
0.959
$959.60
$988.32
$830.09
$960.82
$900.45
$899.67
$728.56
$871.63
93.8%
91.0%
87.8%
90.7%
$71.96
$71.96
$71.96
$71.96
($12.81)
$16.69
$29.58
$17.23
-1.3%
1.7%
3.6%
1.8%
($50,155)
$960,982
$357,208
$1,268,035
431,258
0.934
$912.93
$820.50
89.9%
$71.96
$20.47
2.2%
$8,829,672
Total Paid
(cps, rebates,
IBNR) PMPM
Loss Ratio %
w/Risk Rev
Admin PMPM
Net Gain/Loss
PMPM
Profit
Margin %
Profit Margin
$
$850.89
$478.07
$619.73
$1,101.34
$840.55
92.3%
68.3%
83.6%
91.0%
90.4%
$81.78
$81.78
$81.78
$81.78
$81.78
($11.08)
$139.85
$39.88
$27.34
$6.98
-1.2%
20.0%
5.4%
2.3%
0.8%
($434,057)
$136,186
$463,064
$263,346
$428,540
PPO
Contract
ID
PBP
MM
RAFactor
Part C
H5042
H5042
H5042
H5042
1
4
5
7
39,174
974
11,610
9,631
61,389
0.796
0.727
0.655
0.929
0.789
Total
Revenue
w/Risk Rev
PMPM
$921.59
$699.70
$741.40
$1,210.47
$929.32
H5042
H5042
H5042
801
802
803
2,970
23,527
4,928
31,426
0.822
0.784
0.652
0.767
$1,081.02
$873.37
$611.30
$851.90
$799.34
$801.33
$539.53
$760.08
73.9%
91.8%
88.3%
89.2%
$81.78
$81.78
$81.78
$81.78
$199.89
($9.74)
($10.01)
$10.03
18.5%
-1.1%
-1.6%
1.2%
$593,684
($229,222)
($49,346)
$315,116
92,815
0.782
$903.10
$813.31
90.1%
$81.78
$8.01
0.9%
$743,656
524,072
0.907
$911.19
$819.23
89.9%
$73.70
$18.27
2.0%
$9,573,328
Medicare Medical Loss Ratio (MLR) by County
Medicare MLR by County
COUNTY
NONE
Albany
Broome
Chenango
Columbia
Delaware
Dutchess
Essex
Fulton
Greene
Hamilton
Herkimer
:
:
TOTAL
MM
RAFactor
Part C
1,778
168,827
4,016
1,268
16,831
8,266
26,190
2,242
9,774
15,902
737
1,110
:
:
0.714
0.976
0.925
0.828
0.884
1.061
1.140
1.158
1.140
1.221
0.934
1.044
:
:
524,072
Revenue
PMPM
$807.37
$1,039.71
$956.89
$846.14
$978.45
$941.36
$1,009.15
$1,032.48
$958.03
$1,008.78
$926.59
$1,026.26
$911.19
Loss Ratio
%
:
:
$819.23
Admin
PMPM
43.1%
92.0%
96.4%
106.5%
92.0%
91.9%
88.2%
91.6%
92.0%
97.7%
66.7%
77.1%
$348.00
$956.04
$922.90
$900.89
$899.78
$865.45
$890.34
$945.34
$881.01
$985.74
$617.77
$791.24
:
:
:
:
0.907
Paid
PMPM
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
$73.70
:
:
89.9%
$73.70
Net
Profit
Profit Margin
Gain/Loss
Margin %
$
PMPM
47.8%
$685,575
$386
$10
1.0%
$1,683,736
($40)
-4.1%
($159,464)
($128)
-15.2%
($162,915)
$5
0.5%
$83,686
0.2%
$18,303
$2
$45
4.5%
$1,181,590
$13
1.3%
$30,125
0.3%
$32,477
$3
($805,551)
($51)
-5.0%
$235
25.4%
$173,285
$179,000
$161
15.7%
:
:
:
:
:
:
$18.27
2.0%
$9,573,328
Shared Savings Programs
• Enhanced Primary Care (EPC)
– Capitation program for primary care physicians (PCPs)
• Shared savings with specialty provider groups
• Launching Total Cost of Care (TCOC) shared savings program for
PCPs
• Managing members with 6+ chronic conditions
Members with 6+ Chronic Conditions
Dementia
Depression
Coronary
Heart Disease
Diabetes
Chronic
Kidney
Disease
Heart failure
Cerebral
Vascular
Disease
Hypertension
Cancer with
Poor
Prognosis
Peripheral
Vascular Disease
Cancer
Atrial
Fibrillation
Pulmonary Disease
6 + Chronic
Conditions
Severe Chronic
Liver Disease
Members with 6+ Chronic Conditions… continued
• 10% of Medicare population qualifies for the program
Medicare Net G/L for 6+ Chronic Members
• Includes TCOC of a member
• Engagement rate expected
to be close to 50%
• Providing 24/7 care in-home
for these complex, high-cost
members
6+ Chronic
Conditions
Engaged
Non-Engaged
Rest
MM
RAFactor
Part C
Revenue
PMPM
20,000
25,000
479,072
2.100
1.900
0.805
$1,900.00
$1,700.00
$828.75
524,072
0.907
$911.19
Loss
Paid
Ratio % Admin
PMPM
w/Risk
PMPM
Rev
$2,400.00
126% $73.70
$2,200.00
129% $73.70
$681.18
82% $73.70
$819.23
90% $73.70
• Clinical partnership model – PCP remains the primary driver of care
• Monitoring engaged vs. non-engaged members
• Monitoring members just entering the cohort vs. close to end of life
Net
Gain/Loss
PMPM
($573.70)
($573.70)
$73.87
$18.27
Understanding Our Risk Scores
• Mid / final sweep – impact on MMR risk scores
• Risk score by:
– All members
– Member continuously enrolled
– Members with less than 12 months data
– New enrollees
– End stage renal disease (ESRD)
– Deceased members
• Risk score projections
Risk Score by:
Comparing our Projections to Actuals
• Quarterly reporting of projection vs. actuals
– Medicare trend projection vs. actual
– Cost share comparison from
WS3 (Medicare Advantage
Workbook) by PBP
– Pharmacy trends
– LICS, fed reinsurance,
corridor results
– Pharmacy rebates
Risk
Working with the Consulting Actuary
•
•
•
•
Involvement of the
consulting actuary on
a regular basis after
the bids
Educating the
consultants about
our data and claims
process
Involvement of our
consultants during
Medicare strategic
meetings
Risk model and
analytics
Inpatient Facility only
Inpatient Facility - MH&SA *
Skilled Nursing Facility
Outpatient Facility - Surgery
Outpatient Facility - ER
Outpatient Facility - Other
Physician Office
Physician Facility (IP,ER,OBS)
Physician Misc
Physician PT/OT/ST/CHIRO
Physician MH&SA
Physician Surgery (IP,OP,OFF)
Home Health
Other Services
P&A/DME
PCP Case Management & Incentives
Lab Cap
EPC
ALL SERVICES - ALLOWED
COPAY
ALL SERVICES - PAID
Utilization
0.238
0.006
0.869
0.346
0.253
5.647
8.227
3.260
9.157
1.840
0.563
3.098
0.666
11.820
0.800
0.0000
0.0000
0.0000
Actuals
2014
Cost
$9,828.07
$6,954.00
$334.36
$1,455.66
$507.67
$120.47
$79.56
$94.44
$118.59
$43.68
$71.51
$164.36
$129.27
$52.76
$128.80
$0
$0
$0
PMPM
Utilization
$205.57
0.226
$3.48
0.007
$25.50
0.788
0.371
$44.20
0.290
$11.26
$59.67
5.701
$57.42
7.657
$27.01
3.216
$95.26
8.797
$7.05
1.792
$3.53
0.636
$44.66
3.179
$7.55
0.717
$54.70
11.745
$9.03
0.819
$7.34
0.0000
$2.95
0.0000
$0.45
0.0000
$666.63
($42.24)
$708.87
Projected
2014
Cost
$10,446.81
$7,540.29
$395.35
$1,461.88
$519.51
$125.67
$80.66
$95.80
$124.25
$44.47
$71.82
$169.51
$136.15
$52.52
$132.04
$0
$0
$0
PMPM
$207.20
$4.40
$27.32
$47.55
$13.20
$62.84
$54.18
$27.03
$95.88
$6.99
$4.01
$47.26
$8.56
$54.11
$9.49
$9.01
$2.97
$5.83
$687.83
($36.65)
$724.48
Questions
How to Analyze Your Plan’s
Experience and What it Means for
Medicare Bid Planning in the Coming
Year
Presented by
Matthew P. Chamblee, FSA, MAAA, CERA
Principal & Consulting Actuary
[email protected]
813-282-9262
June 16, 2015
Agenda
CMS Review or Audit Issues
Data Issues
Timeline Issues / Post Mortem on Bid/Process
Budgeting
Contracting Issues
Understanding Your Plans – Benefit Values/OOPC/TBC
Understanding Your Plans – Risk Scores/Durational
New Plan Modeling – C-SNPs, D-SNPs, Consolidation, New Areas
Understanding Next Year
1
June 29, 2015
CMS Review / Audit Issues
Understanding sources of observations / findings and remediation
steps
Examples : claims / admin reconciliations, related parties
2
June 29, 2015
Data Issues
Grouping data
Understanding where claims are being grouped
Copay issues (will this cause problems with benefit changes)
PDE issues
Encounter (sub-capitated) data issues
Utilizers
3
June 29, 2015
Timeline Issues / Post Mortem on Bid
Who did what when
Number of iterations
Data processing time
4
June 29, 2015
Timeline Issues / Post Mortem on Bid
Model testing
Assumption testing
Re-project using 2015 information
Claim costs
Part D cash flows
Risk Corridor / Supplemental Premium
Contract assumptions (actual contract vs expected/bid)
Risk score assumptions
Medical management assumptions
5
June 29, 2015
Actual vs Expected / Budget Refresh
Sometimes the budgets are not based on bids
Can revise assumptions and experience to generate actual to
expected and new CY budgets
6
June 29, 2015
Contracting Issues
Understanding/maximizing value your Part D contract
Discounts vs Rebates
Price Protection
Preferred Pharmacy design
Formulary design – modeling rebates
Understanding how the formulary effects the OOPC calculator
7
June 29, 2015
Contracting Issues
Part C contracts
Capitated contracts
Contract language – are you subsidizing?
Example is a contract that has one rate vs two rates – one for the
individual plans and one for the D-SNP plans
Global risk contracts – test whether you can do them or if already
in place how effective the global contract is working
8
June 29, 2015
Understanding Your Plans
Hxxxx-001-000
Type of Service
Inpatient Hospital - Acute
Inpatient Hospital - MH/SA
Inpatient Psychiatric
Skilled Nursing Services
Cardiac Rehabilitation Services
Pulmonary Rehabilitation Services
Emergency Care / Post Stabilization Care
Urgently Needed Care / Urgent Care Centers
Partial Hospitalization
Hospice
Home Health Services
Primary Care - Facility Visits
Primary Care - Consults/Office Visits/Home Visits
Chiropractic Services
Chiropractic Services - Routine (Non-Covered)
Occupational Therapy Services
Physician Specialist Services - Consults/Office Visits/Home Visits
Physician Specialist Services - Facility Visits
9
June 29, 2015
WS3
Copay
Coins
a.1.
a.1.
a.2.
b.
h.5.
h.5.
f.
f.
h.3.
c.
c.
i.1.
i.1.
i.2.
i.2.
i.4.
i.2.
i.2.
$95
$95
$95
$50
$5
$5
$65
$0
$0
$0
$0
$0
$0
$0
$0
$0
$5
$0
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
Util/1000
632.3
10.1
4.6
272.4
0.4
0.0
341.3
60.8
7.8
0.0
199.7
444.8
2,933.5
131.5
0.0
34.8
2,939.3
941.2
Allowed
Copay
Net
PMPM Util Factor PMPM
$128.23
$1.37
$0.26
$11.26
$0.02
$0.00
$25.57
$0.76
$0.05
$0.00
$0.73
$11.77
$139.66
$0.17
$0.00
$0.54
$27.64
$13.58
0.625
0.866
0.852
0.693
1.000
0.000
0.939
1.000
1.000
0.000
1.000
1.000
1.001
1.000
0.000
1.000
0.948
1.001
$125.11
$1.30
$0.23
$10.48
$0.02
$0.00
$23.83
$0.76
$0.05
$0.00
$0.73
$11.77
$139.66
$0.17
$0.00
$0.54
$26.48
$13.58
Understanding Your Plans
OOPC testing - most bang for the buck
TBC testing – will any plans have issues
10
June 29, 2015
Understanding Your Plans
Risk Score Cohort Analysis
ABC- Coding Intensity Analysis for 20XX Bids
Coverage
Year
2006
2007
2008
MMR Risk Score
2008
0.89
0.80
0.74
Coding Intensity
Normalization Change
Model/Coding Intensity Change
2008
2008
2008
1.10
1.01
0.97
1.15
1.01
0.97
1.07
1.01
0.97
MMR Risk Score
2009
0.96
0.90
0.78
0.79
Coding Intensity
Normalization Change
Model/Coding Intensity Change
2009
2009
2009
1.11
0.99
0.97
1.16
0.99
0.97
1.07
0.99
0.97
1.11
0.99
0.97
MMR Risk Score
2010
1.03
0.99
0.79
0.83
0.95
Coding Intensity
Normalization Change
Model/Coding Intensity Change
2010
2010
2010
1.10
0.98
1.00
1.02
0.98
1.00
1.13
0.98
1.00
1.10
0.98
1.00
1.10
0.98
1.00
11
June 29, 2015
2009
2010
Understanding Your Plans
Risk score cohort analysis
Durational cohort analysis
12
June 29, 2015
New Plan Modeling
New Plans – D-SNPs, C-SNPs
New Service Areas
Consolidation
13
June 29, 2015
Understanding Next Year
Rebasing – what will happen / scenarios
Revenue modeling
14
June 29, 2015
Questions