This is the mental health company’s second round of layoffs in the past year. 

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/digital-health/headspace-health-layoffs-cuts

The Centers for Medicare and Medicaid Services has proposed cutting reimbursements to home health providers by 2.2% in fiscal 2024 in a draft regulation published Friday.

The proposed rate change is the product a 3% market basket update, a minus 5.1% adjustment related to the Patient-Driven Groupings Model and other factors.

CMS introduced the Patient-Driven Groupings Model in 2020 as a means to reduce unnecessary care by instead pegging reimbursements to patient characteristics. The agency built an assumption that providers would respond by upcoding claims and incorporated a downward reimbursement adjustment to compensate, although by law the payment model must be budget neutral compared to the old system.

The agency badly miscalculated both how providers would adapt to the revised reimbursement system and how it determined budget neutrality, which threatens the viability of home health providers, an industry trade group said.

"Overall spending on Medicare home health is down, fewer patients are receiving care, patient referrals are being rejected because providers cannot afford to provide the care needed within the payment rates, and providers have closed their doors or restricted service territory to reduce care costs. If the rate was truly budget neutral, we would not see these actions occurring," National Association for Home Care and Hospice President William Dombi said in a statement. "The fatally flawed budget neutrality methodology that CMS continues to insist on applying will have a direct and permanent effect on access to care."

Partnership for Quality Home Healthcare CEO Joanne Cunningham said she fears the cuts would cost the industry close to $18 billion over the next decade. "The home health provider community is gravely concerned that CMS’s proposed actions for 2024 will only continue to degrade beneficiary access to home healthcare services,” she said in a statement.

CMS also proposes modifications to the home health value-based purchasing program by replacing five current metrics with a claims-based discharge measure, an outcome and improvement discharge function score and a within-stay measure for potentially preventable hospitalizations. These changes would take effect in 2025 and CMS projects they would save $3.38 billion through 2027.

The agency will accept comments on the home health prospective payment system proposed rule through Aug 29.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/policy/medicare-payments-home-health-cms-proposed-rule-2024

Bright Health's deal to divest its California Medicare Advantage business to Molina Healthcare marks the ends of its insurance operations.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/mergers-acquisitions/bright-health-molina-medicare-advantage-deal

Lawyers share two more of the biggest reasons their healthcare clients are seeking counsel in the last of a two-part series.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/legal/telehealth-staffing-concern-health-lawyers

The hospital industry wants CMS to consider inflation, workforce shortages and rising costs when calculating fiscal 2024 reimbursements for the Hospital Inpatient Prospective Payment System final rule.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/politics-policy/inflation-hospital-costs-cms-hospital-inpatient-ipps-rule-comments

Y Combinator, the startup accelerator that helped produce Airbnb and Instacart, is investing in virtual obesity clinic Alfie Health. 

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/digital-health/y-combinator-alfie-health-gpl-1

Analysts expect the Federal Trade Commission to scrutinize the proposed $3.3 billion deal between UnitedHealth Group's Optum and home health company Amedisys.

On Monday, Amedisys announced it had accepted the sweetened $101 per share, all-cash offer from UnitedHealth Group’s Optum and pulled the plug on a proposed $3.6 billion all-stock deal with Option Care Health. The announcement came four months after Minnetonka, Minnesota-based UnitedHealth Group closed on its $5.4 billion acquisition of home health firm LHC Group. The FTC’s request for additional information delayed that deal for several months.

Optum said in a news release it is confident regulators will approve the deal. The FTC did not respond to requests for comment.

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Amedisys and LHC Group are the nation’s second- and third-largest home health agencies by revenue, respectively. Even though analysts estimate the combined companies only make up about 10% of the highly fragmented home healthcare market, they say this week’s proposed transaction is likely to raise concerns.

“When you go into certain geographic markets, there is overlap between [LHC Group] and Amedisys,” said Scott Fidel, managing director at the financial services company Stephens Inc. “We think from the bottom-up perspective, there probably will be markets where there would be divestitures that would need to be pursued [for regulatory approval].”

The combination could also prompt the FTC to look more closely at future deals that involve the vertical integration of health insurance and care delivery, said Fidel.

It is a trend UnitedHealth Group, Humana and CVS Health have been pursuing in recent years as Medicare Advantage plans grow in popularity with baby boomers.

UnitedHealth Group is the nation’s largest health insurer and largest Medicare Advantage organization by enrollment through its United Healthcare business. The company has also acquired physician practices, a data analytics business, a prescription drug unit and the home healthcare units through its Optum business.

Humana, the nation’s fourth-largest health insurer and second-largest Medicare Advantage organization by enrollment, acquired home health firm Kindred at Home in 2021 and rebranded it under its CenterWell unit, which also owns primary care and pharmacy services.

CVS Health owns Aetna, the nation’s sixth-largest health insurer and fourth-largest Medicare Advantage organization by enrollment. The retail giant also owns pharmacy benefit manager CVS Caremark, home health technology and analytics platform Signify Health and primary care provider Oak Street Health.

The scale vertically integrated corporations have in some markets could invite inquiries from the FTC about other companies’ ability to price services and attract workers, Steven Parente, finance professor from the University of Minnesota’s Carlson School of Management, said.

“Many of these services are really region by region and in some areas they could really squeeze out the competition,” Parente said.

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A report in March by the Brookings Institution, a think tank, raised additional concerns that vertical integration could increase Medicare Advantage plan spending on goods and services related to businesses owned by health insurers.

The Affordable Care Act requires Medicare Advantage plans to spend at least 85% of premium revenues on health expenses, as opposed to administrative costs or profits. However, if a plan is spending money on services that the parent company owns, those expenses could be considered profits, the Brookings Institution said.

Still, some analysts think additional scrutiny of healthcare deals by the FTC could make it harder for the Centers for Medicare and Medicaid Services to expand value-based care, which ties reimbursements to quality of services. CMS has set a goal of moving 100% of Medicare beneficiaries into value-based care arrangements by 2030.

“That level of integration between physicians, home health and every other part of the healthcare delivery system is what makes value-based care effective,” said Brian Tanquilut, a healthcare equities analyst from Jefferies. “What CMS is basically saying is we want vertical integration, one way or the other.”

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/providers/optum-amedisys-deal-ftc-unitedhealth

Revenue cycle management, technology and economic uncertainty were major themes at the Healthcare Financial Management Association conference in Nashville, Tennessee, this week.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/finance/hfma-2023-nashville-claim-denials-recession

The Supreme Court has ruled that universities may no longer consider race in admissions, potentially disrupting efforts to diversify the healthcare workforce.

via Section Page News - Modern Healthcare https://www.modernhealthcare.com/legal/supreme-court-affirmative-action-ruling-healthcare-industry-reaction

J.C. Hallman’s “Say Anarcha” is a deeply researched but ultimately flawed revisionist biography of J. Marion Sims, a celebrated surgeon who operated without anesthesia on young enslaved Black women and teenagers. The “speculative nonfiction” is best understood alongside other major works.

via Undark Magazine https://undark.org/2023/06/29/book-review-the-father-of-gynecology-and-his-enslaved-patient/