Massachusetts Health & Hospital Association


> Change Healthcare: A $24 Million Problem
> Warren Not a Fan of Medicare Advantage
> Hospital Inpatient SUD Services Work
> A Grant to Help Grant Writing
> Hospitals Help Fund MSP Expansion
> Spending Bills in D.C.
> The Long Wait for Available Beds
> National Patient Safety Awareness Week


Change Cyberattack Costing Mass. Hospitals at Least $24 Million Per Day

Massachusetts hospitals are expressing alarm at how the cyberattack on Change Healthcare is sapping tens of millions of dollars from them each day.

Change, a subsidiary of UnitedHealth Group, conducts a number of mission-critical services, including those dealing with revenue cycle, pharmacy, certain healthcare technologies, and clinical authorizations. When its systems were hit on February 21 by a rogue player – identified by federal authorities as ALPHV/Blackcat – Change Healthcare went offline and facilities around the nation disconnected from it.

MHA immediately sent out a survey to its membership to assess the problem. The responses were alarming. Among a sample of 12 Massachusetts hospitals and health systems, the disruption is causing approximately $24,154,000 in reimbursement losses each day. The exact daily impact varies widely from organization to organization depending on how much a hospital/system relies on Change Healthcare. For many physician practices and hospitals both in the commonwealth and across the country, the cash shortfalls may mean they will be unable to meet payroll without loans or bridge payments. As 71% of Massachusetts hospital health systems are currently experiencing negative operating margins, according to the Center for Health Information and Analysis, the cash flow problem from the Change Healthcare cyberattack is especially worrisome.

From an operational standpoint, approximately 75% of respondents indicated disruptions related to claims processing, pharmacy, and the ability to obtain patient data, such as eligibility. Both the financial and administrative disruptions affect all lines of business – Medicare, Medicaid, and commercial insurance.

“We’ve heard from members that it’s truly shocking how quickly this problem cascaded, and that it hits especially hard on top of the ongoing capacity, workforce, and financial challenges hospitals already are facing,” said MHA’s Senior Director of Managed Care Karen Granoff.

The situation and potential remedies are evolving on a daily basis. UnitedHealth Group has offered various workarounds as well as a temporary funding assistance program that was immediately slammed by the American Hospital Association. The assistance program doesn’t address providers’ inability to file claims, and sets up “shockingly onerous” payment terms, such as allowing the insurer’s bank to “immediately and without prior notification” recoup any assistance funds, AHA wrote.

Last Thursday, UnitedHealth Group provided its first significant update since the initial event, saying that it expects to have its payment platform and medical claims network up by March 15 and 18, respectively. Providers expressed skepticism about the aspirational timeline, and health sector leaders stressed that the impact will extend well into the future. AHA President and CEO Rick Pollack noted, “Even after Change Healthcare’s technology is restored, it will be weeks – if not months – before our hospitals and other healthcare providers will be made whole.”

Locally, Massachusetts-based health insurers have been more collaborative, working with individual providers, and standing up website pages to offer information and alternatives to keep the paperwork flowing. MHA sent a letter last week to the Massachusetts insurers asking them to waive claims filing limits, ease prior authorizations, and extend appeals filing times. “In addition to the above, and depending on how both Change Healthcare and the federal government address cash flow, we ask that health plans consider bridge payments similar to those Point32Health provided last year during the cyberattack that impaired its network,” MHA wrote.

Massachusetts Association of Health Plan (MAHP) member insurers indicated to MHA on Friday afternoon that while they are not issuing blanket waivers, the plans are willing to work with individual providers and hospitals to address specific issues, including, in certain instances, assisting providers with cash flow challenges or extending claims filing periods. Affected providers are encouraged to contact each plan to discuss their specific situation. Blue Cross Blue Shield of Massachusetts is waiving its 90-day claim filing limit and its one-year appeals filing limit for its commercial, Medicare Advantage, and Federal Employee Program plans. The insurer will give notice before resuming standard filing limits. Providers should contact Blue Cross directly with any other questions or concerns related to the cyberattack.

To mitigate the financial and operational effects of the cyberattack, providers also are being encouraged to weigh the pros and cons of using an alternative clearinghouse vendor. While it is understood that this may not be a quick or easy fix, clearinghouses could be a possible solution given that it is unclear how long the disruption will continue.

As for the federal government, last Wednesday the Centers for Medicare and Medicaid Services sent notice to the plans under its purview, writing, “We expect Medicare Advantage (MA) organizations and Part D sponsors to continue to provide access to covered benefits without disruption by executing their business continuity plans and removing or relaxing utilization management and timely filing requirements as appropriate. CMS is also encouraging MA organizations to offer advance funding to providers most affected by this cyberattack.”

Sen. Warren Calls for Greater Oversight of Medicare Advantage Plans

Senator Elizabeth Warren (D-Mass.) delivered a one-two punch last week against national Medicare Advantage (MA) plans, saying during a visit to Boston last Monday that they’re “threatening the solvency of the Medicare system overall,” and signing onto a letter that same day that calls on the Biden Administration to further regulate “insurer tactics that we believe limit care and aim to increase their profits.”

Warren attended the Monday provider roundtable at Tufts Medical Center with CMS Administrator Chiquita Brooks-LaSure. The providers, which included CEOs, case managers, care coordinators, and patient care service leaders, among others, spoke of the significant challenges they face with Medicare Advantage plans – particularly around prior authorizations, denials, and the length of time it takes to get responses. A recent CMS rule that takes effect in 2026 intends to speed up the prior authorization process by requiring that payers respond within seven days for standard requests and within 72 hours for urgent cases; but the providers in attendance said that’s still far too long to wait for an insurer to sign off on care. Other problems highlighted were around network inadequacy, particularly in Western Massachusetts, and the fact that many Medicare Advantage plans do not have 24/7 coverage to help respond quickly to provider/patient requests.

Warren was especially critical of what she said was the MA plans’ “upcoding” of diagnoses so that they can reap higher reimbursements from Medicare. She said MA upcoding practices divert $54 billion annually from traditional Medicare.

The provider representatives in attendance stressed to Warren that their complaints centered on the national MA plans – especially United HealthCare. Massachusetts-based insurers are generally much more responsive on prior authorization requests, often responding within a day, the providers said.

On Monday, Warren signed onto this letter with nine other Democratic senators, calling on the Biden Administration to improve beneficiary coverage and reduce taxpayer costs in Medicare Advantage. The letter notes that, on average, CMS pays six percent more per MA enrollee than the agency would pay to cover the same enrollee in traditional Medicare, while also routinely denying care coverage. Among their suggestions, the 10 senators called on CMS to crack down on upcoding and “misleading and deceptive” MA marketing practices.

RIZE Report: Bolster Hospital Inpatient Addiction Consult Services

The independent, non-profit RIZE Massachusetts has issued a new report showing how inpatient hospital addiction consult service (ACS) programs can effectively identify people at risk of overdose and connect them to needed resources. The report calls for the development of more ACS programs.

“Inpatient Addiction Consult Services in Massachusetts: Insights and Recommendations from Six Model Programs” outlines the challenges these programs face and offers recommendations on expanding them.

“Many individuals in inpatient care have a substance use disorder (SUD) that is left untreated, and the risk of opioid-related overdose mortality is heightened following a hospital discharge,” said RIZE President and CEO Julie Burns. “The inpatient hospital setting is the perfect opportunity to identify at-risk individuals and provide accessible harm reduction and recovery services that they desperately need once they return to the community.”

The recommendations for building out an effective system of hospital addiction care across Massachusetts include implementing policies and protocols that support harm reduction goals and address stigma among hospital staff and leadership; improving connections to services after discharge by providing patients with appropriate follow-up care, expanding access to methadone, and investing in bridge clinics and community-based harm reduction and treatment services; and improving the insurance reimbursement system, while increasing reimbursement rates and coverage of addiction services, among other funding steps.

“We’re proud to see hospitals across Massachusetts embrace ACS programs, which by now are a proven tool in introducing critical SUD services to patients on the front lines of care,” said Leigh Simons, senior director of healthcare policy at MHA. “These are lifesaving interventions, but we agree they cannot reach their full potential without better access to post-hospital services, improved insurance supports, and bold efforts to build and train the healthcare workforce. MHA and our members applaud RIZE for its leadership in advancing ACS programs and its partnership to improve equitable SUD treatment throughout the commonwealth.”

State Program Helps Groups Access SUD Grant Funding

The Massachusetts Opioid Recovery and Remediation Fund (ORRF) that was established in 2020 is funded by legal settlements brought against companies that were connected to the opioid crisis. For example, in February, Massachusetts Attorney General Andrea Joy Campbell announced that the state received $8 million from a $350 million national settlement with Publicis Health, a marketing and communications firm that worked for opioid manufacturer Purdue Pharma. The ORRF is expected to amass more than $1 billion over the next 17 years.

An Advisory Council oversees the ORRF and determines the ways to disseminate its funding. But the organizations helping people most affected by the opioid scourge, and the municipalities disproportionally affected, may not have the budget to hire grant writers – which is a specialized skill.

Last week, the Healey Administration announced a community grant program in which RIZE Massachusetts will proactively reach out to potential grantees and support them through the grantmaking process. The administration dedicated $5 million to what it says is a first-in-the nation grant program.

“We recognize that realizing equity in our health outcomes requires equitable distribution of resources to community and grassroots organizations who may have the skillset, lived experience, and local knowledge, but may lack the ability to compete effectively for grant/foundation support for their work,” said Undersecretary of Health and Health Services Kiame Mahaniah. “We are hopeful this effort will level the playing field for community organizations, catalyze pilot programs to test new approaches and treatment, and diversify the pool of providers available to fight the challenge of SUD in our communities.”

The program aims to fund more than 30 grantees in its initial year, with awards ranging from $50,000 to $150,000 over an 18-24 month period.

State Expands Senior Access to Medicare Savings Program

The Healey Administration announced last week action on a proposal it has long identified as a priority – eliminating the Medicare Savings Program asset limit to allow more seniors to access it.

The Medicare Savings Program helps pay for Medicare beneficiaries’ premiums and other healthcare costs, including prescriptions. Participation in the program has been limited by income and by assets, such as home ownership and bank savings. In 2023, MassHealth increased the income limit for the program to 225% of the federal poverty level. Last week’s state action, effective March 1, eliminates the asset limit. Current MSP income limits are $2,824 per month for a single individual and $3,833 per month for a married couple.

“Expanding eligibility for the Medicare Savings Program is just one step in helping our seniors save money so that they don’t have to decide between buying prescriptions or meeting other basic needs,” Governor Maura Healey said in announcing the change.

To fund the expansion of the program, the state transfers money out of the Health Safety Net (HSN) fund, which is funded by hospitals and health insurers. The HSN funds medically necessary care for low-income or uninsured individuals and each year runs a deficit, which hospitals absorb.

Congress Moves Quickly on a Partial FY24 Spending Bill

Following four short-term continuing resolutions for fiscal year 2024 (FY24) since October 1, 2023, Congress last week completed appropriations for six of the 12 spending bills before it, including the Agriculture/Food and Drug Administration appropriations. The Department of Health and Human Services (HHS) is not included in the current package, but many health extenders are, including:

  • The scheduled Medicaid Disproportionate Share Hospital (DSH) cut for fiscal year 2024 is eliminated; the cuts scheduled for fiscal years 2025-2027 remain in place.
  • Medicare-dependent hospital and low-volume hospital programs are extended through December 2024.
  • Funding for community health centers, the National Health Service Corps, and Teaching Health Center Graduate Medical Education is extended through December 2024.
  • A scheduled Medicare physician payment cut is reduced retroactive to January 1, 2024.

The package does not include the hospital price transparency and site neutral provisions contained in the Lower Costs More Transparency Act that the House passed in December 2023.

The current appropriation bills passed the House last Wednesday by a vote of 339-85, with the Massachusetts delegation voting in the majority. The Senate took up the package on Friday and passed it 75-22, with Massachusetts Senators Elizabeth Warren and Ed Markey voting aye. Funding for the remaining six appropriations bills, including HHS, must be extended before midnight on March 22 when the current continuing resolution expires.

Long Waits for Available Beds

MHA’s most recent Throughput Survey Report (January 2024) – a point-in-time questionnaire to hospital case managers asking how many patients in their facilities are awaiting discharge to a post-acute facility or services – showed 912 patients were stuck in just 40 of the hospitals that responded to the MHA survey. When patients cannot transition out of an acute care hospital bed, other patients boarding in hospital EDs or in medical/surgical units awaiting that occupied bed have nowhere to go.

The survey showed that 42% of patients awaiting to be discharged to a skilled nursing facility were waiting for 30 days or more. The report noted that, at any given time, there are 40 patients in acute and post-acute care hospitals in Massachusetts who are awaiting placement in DPH state hospitals.

Among the solutions to the throughput problem is revising the longstanding Medicare 3-Midnight Rule, which requires a patient to stay at least 72 hours in a hospital inpatient unit prior to a Medicare-covered skilled nursing facility stay. During the COVID-19 emergency, the rule was waived to improve throughput so that patients could be admitted directly to a skilled nursing facility, thereby freeing up acute care hospital beds. That emergency waiver is no longer in effect, stranding patients in inpatient care longer than necessary as they await Medicare approval for skilled nursing care.

National Patient Safety Awareness Week

It’s National Patient Safety Awareness Week (March 10-16) – the recognition launched in 2002 by the National Patient Safety Foundation, which merged with the Institute for Healthcare Improvement (IHI) in 2017. On Thursday, March 14, IHI is holding a free webinar on “Diagnostic Excellence.” It’s part of the IHI’s Leadership Alliance Patient Safety Learning Series. Register here; the link also brings you to a page with recordings of other IHI safety webinars. And note (at top) MHA’s Caring for the Caregiver webinar on “Psychological Safety” that will be held on Wednesday, March 13.

John LoDico, Editor