Q3 Update: Medicare Advantage Under the Spotlight in Payer-Provider Disputes
FTI Consulting has been closely tracking how negotiations between payers and providers over reimbursement rates and other contract terms have been playing out in the public through news coverage, paid and earned media, and the response from local officials, state and federal lawmakers, and regulators. Over two years, our research has found a steady increase in media coverage of payer-provider rate negotiations, with significant year-over-year increases from 2022 to 2023.1,2
In analyzing Q3 data, a notable development has been the increased focus on Medicare Advantage (MA) plans in contract disputes, with some health systems dropping MA plans entirely from their networks.3,4 In light of this development, our analysis also includes information about disputes involving MA in 2022 and 2023.
What we found: The increased media coverage of reimbursement rate negotiations observed in the first half of 2023 has continued through the third quarter
Q4 2023 Healthcare Quarter in Review
- In Q3 2023, at least 21 disputes became public and were covered in the media, compared to only 11 in Q3 2022 – a 91% increase.
- Coverage of disputes in Q3 2023 was spread across 13 states, compared to just seven states during the same time frame in 2022.
- Over one–third of the disputes covered by the media this year have already failed to reach a timely agreement, placing hundreds of thousands of patients out-of-network for some period of time. Moreover, at least 13 disputes facing end-of-year deadlines have yet to reach an agreement, putting more patients at risk of losing in-network access to their providers, hospitals, and health systems as they head into 2024.
Spotlight on Medicare Advantage
- Of 64 disputes reported in the media this year through September 30, 2023, 37 – or 58% – involve MA plans, and 10 exclusively involve MA plans.
- Similarly, 29 of 51 – or 56% – disputes reported in the media throughout 2022 involved MA plans, with eight disputes exclusively involving MA plans.
- In Q3 2023, 15 disputes involved MA, the most we’ve seen in one quarter, compared to only seven in Q3 2022, representing an 115% increase year-over-year.
“OON” stands for “Out of Network.”
So far, 2023 has brought a significant increase in media coverage of disputes between payers and providers compared to 2022, with the potential for this trend to continue through the end of the year as many unresolved disputes play out in Q4. With open enrollment for 2024 coverage now underway, individuals, families, and businesses around the country are likely watching these disputes very closely to make the best decision about their health plan coverage options.
A note on methodology: FTI Consulting searched multiple news databases for articles regarding negotiations over reimbursement rates between provider organizations and insurance companies. Those negotiations publicly reported by a news outlet on January 1, 2023, or later were counted for 2023. Negotiations that were resolved or failed to reach an agreement in 2023 but were first reported in 2022 were counted for 2022.
The views expressed in this article are those of the author(s) and not necessarily the views of FTI Consulting, its management, its subsidiaries, its affiliates, or its other professionals.
©2023 FTI Consulting, Inc. All rights reserved. www.fticonsulting.com
[1] Adam Broder, Citseko Staples Miller, Sophia Setterberg, Michael Adeyanju, Nicole Labkoff, Merzulie Gregoire, Paula Gutierrez, “Media Coverage of Payer-Provider Disputes Jumps 260% in Q1,” FTI Consulting, Inc. (May 1, 2023), https://fticommunications.com/media-coverage-of-payer-provider-disputes-jumps-260-in-q1/?topic_origin=healthcare-life-sciences.
[2] Adam Broder, Citseko Staples Miller, Paula Gutierrez, “Local News Outlets Continue to Highlight Increasingly Common Payer-Provider Disputes,” FTI Consulting, Inc. (July 25, 2023), https://fticommunications.com/local-news-outlets-continue-to-highlight-increasingly-common-payer-provider-disputes/?topic_origin=healthcare-life-sciences.
[3] Jakob Emerson, “Hospitals are dropping Medicare Advantage left and right,” Becker’s Hospital Review. (October 9, 2023), https://www.beckershospitalreview.com/finance/hospitals-are-dropping-medicare-advantage-left-and-right.html.
[4] Nona Tepper, “How rural hospitals are fighting Medicare Advantage,” Modern Healthcare. (September 11, 2023), https://www.modernhealthcare.com/insurance/rural-hospitals-medicare-advantage.
