As costs increase and payers need to engage aging and rising-risk populations, leadership can improve ROI and Star ratings by focusing on clinically aligned member education.
Payer organizations face increasing margin pressure, especially regarding Medicare Advantage (MA) plans, driving leaders to identify opportunities for efficiencies. A prominent strategy includes bolstering member experience and engagement while emphasizing clinical and health equity measures—an opportunity for scaling care management efforts. But historically, payers have struggled to define an ROI on their care management investment, despite dedicating 10% or more to administrative spend.
Member education is emerging as a strategy to improve ROI and enhance Star ratings by reaching out and engaging with rising and at-risk member populations. Payers have an opportunity to leverage care management by focusing on improving member engagement with educational programs that encourage healthier behaviors and drive action, improving outcomes and reducing costs.
With evidence-based member education solutions, care managers can scale and expand their reach to member populations with various risk factors to better mitigate the long-term cost of care.
The state of Medicare Advantage has shifted
Recently, payers have grown their membership of MA customers by offering rich benefit packages, expanding their portfolios and bringing financial stability. However, the MA landscape has changed as costs have increased and are moving through the system. These changes have a significant impact on senior populations—last year, half of eligible Medicare beneficiaries were on MA plans.
Multiple large payers signal that spending among MA plans is growing due to a range of factors, including:
- COVID-related delays in treatment:About 30% of older adults in the US put off doctor visits, procedures, surgeries, and tests, leading to a surge in costs.
- Lack of pandemic preventive care: In 2022, many older members still hadn’t received the preventive treatment and care they had scheduled in the previous year (a trend that was higher for those not vaccinated against COVID-19).
- An aging population with rising costs: By 2032, about a quarter of the US population will be over 65, up from 10% in 1970. Additionally, the US Department of Health & Human Services found that the mean spend per person for adults over 65 years was $12,411 in 2018, up from $2,026 in 1978.
These factors have left payers squeezed on MA plans—in addition to facing compressing margins, there’s also increased pressure to make changes in advance of upcoming changes to Star ratings and Healthcare Effectiveness Data and Information Set (HEDIS) scores. Some of the most prominent changes will require continuous enhancement of operational efficiencies to maintain strong scores:
- The National Committee for Quality Assurance (NCQA) implementing HEDIS changes in 2022 to improve race and gender health equity.
- The Centers for Medicare and Medicaid Services (CMS) is introducing the Health Equity Index in 2027, emphasizing health equity and outcomes, and places about $16 billion in additional bonus payments at stake.
- An increased focus on preventative care measures and improving or maintaining physical and mental health.
The growing complexity of these programs and the need to prepare is increasing payer costs and can strain relationships with already overburdened providers. Through all this, payers can still move forward with the goal of maintaining or even increasing scores through improved care management.
