From AIS Health: What Can Insurers Expect From Brooks-LaSure at Helm of CMS?

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Reprinted with AIS Health permission from the February 26, 2021 issue of Health Plan Weekly

If Chiquita Brooks-LaSure is confirmed as the next CMS administrator, the managed care industry can expect to see a thoughtful and experienced leader helming an agency that wields vast regulatory power over some of insurers’ most lucrative business lines, industry experts say. However, that doesn’t necessarily mean that every move taken by Brooks-LaSure, HHS secretary nominee Xavier Becerra or the Biden administration at large will be completely industry-friendly.

Dan Mendelson, founder of the consulting firm Avalere Health, suggests that “the health insurance industry can expect her to look carefully at the issues before acting; she’s not an impetuous person in any respect. That thoughtfulness is pretty much a hallmark of her operating style.”

Brooks-LaSure was on Mendelson’s staff, serving as a program examiner and lead Medicaid analyst, when he ran the Office of Management and Budget’s Health Division under President Bill Clinton, and she later worked at Avalere. She has also been a Democratic staffer on the House Ways and Means Committee, where she helped House leaders pass the Affordable Care Act (ACA) and the Medicare Improvements for Patients and Providers Act of 2008. Later, as director of coverage policy at HHS and then deputy director for policy at CMS’s Center for Consumer Information and Insurance Oversight, she helped implement the ACA’s insurance reform provisions. Her most recent role is as a managing director at the professional services firm Manatt Health.

Mendelson tells AIS Health that Brooks-LaSure’s priorities are likely to align closely with that of Becerra — whom senators grilled during two confirmation hearings on Feb. 23 and 24 — and President Joe Biden. “There’s going to be a real focus and a real emphasis on expanding coverage, which has been absent for the last four years,” he predicts. “They’ll do everything they can to make sure that all Americans have access to coverage and actually get insured, whether it be through exchange plans, whether it be through Medicaid, or ensuring the people who are eligible for Medicare are signing up for it and are using it.”

Nominees Are Likely to Focus on ACA

Becerra is known for championing the ACA, having led the coalition of left-leaning states defending the law against a constitutional challenge levied by conservative states (HPW 12/11/20, p. 1). Similarly, Brooks-LaSure will probably use her ACA expertise to further Biden’s stated goal of bolstering the individual health insurance exchanges, Mendelson says.

“The exchanges were really neglected in a lot of ways — I think it’s a testament to the strength of the legislation that they’re still functioning quite well,” he argues. “But it’s not like people are being encouraged to go out and sign up, and it’s not like there is a concerted campaign to ensure that all Americans understand that they have this right to heavily subsidized insurance in most cases.”

In whatever form they take, coverage expansions are generally good for the managed care industry since they lead to more balanced risk pools and greater enrollment. Yet Mendelson points out that insurers may be facing more regulatory scrutiny in some respects with Brooks-LaSure in charge of CMS.

“I would also expect that CMS will start to focus more diligently on issues of beneficiary protection,” he says. “And by that I mean, ensuring that marketing is accurate, ensuring that benefits are being described in ways that make sense to beneficiaries, making sure that appeals and grievances are acted on swiftly and effectively, and having in place some guardrails so that this concept of beneficiary protection is emphasized once again in a way that is consistent with the way that it was under Obama.”

Medicaid MCOs May Find a Lot to Like

Another industry insider sees the nomination of Brooks-LaSure as good news for insurers that serve Medicaid populations.

“As a key player in the passage of the ACA, along with her broad range and deep experience with CMS and other agencies, Brooks-LaSure will be committed to expanding Medicaid,” says Gary Rosenfield, senior vice president of business development and strategy at ConsejoSano, a technology company specializing in culturally aligned member outreach for Medicaid plans. “In doing so, she understands the role Medicaid plans will have in driving better access and quality for beneficiaries, including the expansion population, while providing affordability for taxpayers. She will likely support plans that are innovative, and understands that adequate funding is needed for them to be successful in serving more people.”

“I think she’ll also fully support President Biden’s executive orders rolling back work requirements and block grants, as well as backing his review of the public charge rule, which, if reversed as expected, should result in plans seeing an increase in enrollment,” Rosenfield adds.

In fact, Brooks-LaSure authored a paper for Health Affairs recently in which she laid out several policy proposals to increase health insurance coverage, including temporarily increasing the Federal Medical Assistance Percentage to 100% in a bid to encourage holdout states to expand Medicaid.

Rosenfield also points to Brooks-LaSure’s professional track record as evidence that “she will try to make health equity her signature issue during her tenure at CMS if she’s confirmed.”

He continues, “Medicaid plans that have already begun implementing innovative social determinants of health programs that address food security, affordable housing, and stable employment to name a few, will find themselves very much aligned with her given their common goals of reducing health disparities.”

Mendelson says Becerra and Brooks-LaSure are likely to be closely aligned regarding regulatory and policy priorities, and he points out they already have a rapport having worked together in the House. “This is a major difference between this administration and the last administration,” Mendelson adds, referring to when former CMS Administrator Seema Verma and former HHS Secretary Alex Azar — who replaced Tom Price, M.D., following a scandal over his use of private planes — engaged in various disputes that were leaked to the press.

“By contrast, what’s happening here is that they’re really building the team out around Becerra, and very consciously building a team that is coherent and would not be associated with that kind of drama,” he says.

Brooks-LaSure and Becerra have not historically seen eye to eye on every health policy matter, however. Becerra has a long track record of supporting a move to a single-payer health care system like Medicare for All, although during his Feb. 24 confirmation hearing before the Senate Finance Committee, he indicated that he would follow Biden’s lead and instead emphasize building upon the ACA. Brooks-LaSure, meanwhile, has been a public supporter of more incremental coverage expansions such as Medicare and Medicaid “buy-in” proposals and a public option on the ACA exchanges, noted a Feb. 17 blog post from the Washington, D.C. law firm Akin Gump Strauss Hauer & Feld LLP. Such policies generally would be less disruptive to private insurers than a single-payer system run by the government.

Congress Could Go Looking for Offsets

Although even a public option appears unlikely in the near future given the thin majority Democrats hold in the Senate, Mendelson points out that Congress could still make moves that would be unpopular with the health insurance industry.

“One of the biggest issues, I think, facing the insurance industry right now is whether Congress goes after MLRs [medical loss ratios] as part of a way to generate cost offsets for a large reconciliation bill,” he says, referring to altering the ACA requirements that private insurers spend 80-85% of their premium revenue on medical care and health care quality improvement.

“That, I think, is a significant threat in a world where they’re out looking for money, which is a time-honored tradition,” he adds. “It’s possible that we’ll have not one, not two, but three reconciliation bills in the next couple of years because they’re still working off of the reconciliation instructions from last year right now.”

Not just health insurers, but health care providers and the life sciences industry could all be targeted by Congress’ hunt for budgetary offsets, Mendelson says. “And that’s something that the administration is going to have to think about. I don’t know where they will land on that.”

Contact Mendelson and Rosenfield via Joe Reblando. View the Akin Gump post about Brooks-LaSure and a video of Becerra’s confirmation hearing before the Senate Finance Committee.

by Leslie Small