This is Jacob Emerson with the Becker's payer issues podcast. Here's your biweekly industry news briefing for December 2nd. CMS has proposed major reforms for the Medicare Advantage and Part D programs in its final rule for 2026, including changes to prior authorization and weight loss drug coverage. The agency is also looking for public feedback on how Medicare Advantage medical loss ratios are calculated in order to address concerns surrounding vertical integration across the industry.
As part of its proposal for contract year 26, the agency is proposing that Part d plans and Medicaid programs provide coverage of GLP ones for obesity after previously being excluded, unless those drugs were being used to treat conditions such as diabetes.
CMS is also looking to address concerns about the overuse of prior authorization by introducing clearer definitions for internal coverage criteria, stricter transparency requirements for insurers, ensuring enrollees are informed about their appeal rights, and collecting more data on initial coverage decisions and appeals. CMS is also proposing new standards for MA medical loss ratios reporting to better align with Medicaid and commercial requirements.
The agency is issuing a request for information on potential policies that it could adopt regarding how the MA and Part D MLRs are calculated in order to enable policymakers to address concerns surrounding vertical immigration across the industry. The agency is also proposing to expand the definition of marketing to cover more materials and activities related to MA and Part D plans, requiring more advertisements and communications to be reviewed by the agency
before being shared with the public. The new rule also focuses on improving consumer tools on medicare.gov, and brokers are it's proposed that brokers must discuss additional topics with enrollees such as Medigap rights and low income subsidy eligibility. On the topic of artificial intelligence, CMS said it aims to enforce equitable access to care regardless of delivery by humans or AI tools.
MA plans using AI must comply with anti discrimination laws and provide fair, unbiased access to services. On Becker's website, there's a full analysis of the full proposed rule for contract year 2026. UnitedHealthcare has prevailed in its lawsuit against CMS regarding the methodology used to calculate its 2025 Medicare Advantage Star ratings.
That lawsuit was filed at the end of September in a federal court in Texas, and it revolved around the inclusion of a single disputed customer service phone call in the agency's calculation. The judge ruled that CMS must recalculate United's 2025 star ratings without consideration of the disputed call and immediately republish those recalculated star ratings online.
The courts found that CMS had acted contrary to its own guidelines when evaluating that phone call, which was marked as unsuccessful despite evidence showing it lasted over 8 minutes and connected to a call center representative. United's lawsuit is one of several filed by insurers this year challenging the agency's 2025 MA star ratings. The agency reported a significant drop in 5 star plans for this year with only 7 achieving the top rating compared to 38
last year. Humana, Centene, Elevance, and Blue Cross Blue Shield of Louisiana have all raised legal challenges about the methodology CMS employed for the 2025 ratings. Some of those challenges have centered on the agency's use of secret shopper phone calls to assess customer service metrics. In November, the deputy CMS administrator doctor Mina Seshamani announced that call center measures will carry less weight in future MA star ratings starting in 2026.
Well, Humana misrepresented the providers its Medicare Advantage Plans will be in network with in 2025. That's according to Minnesota's attorney general, Keith Ellison. Mister Ellison sent a letter to Humana CEO Jim Rechten on November 22nd expressing concern that the insurer listed Essentia Health and other health systems as in network for its for its 2025 Medicare Advantage plans on its website. Accenture has said it will be out of network with Humana MA plans in 2025.
Mister Ellison alleged that Humana also listed Avera Health, North Memorial Health, and Sanford Health as in network in Minnesota for 2025, though all three systems have said they intend to exit Humana's m a MA network in the state at the end of 2025. Well, at least 8 health systems are getting out of the insurance business. Earlier this year, Baystate Health in Massachusetts reached a deal to sell Health New England to 0.32 Health for a $165,000,000.
Massachusetts regulators approved that deal on November 26th. Baystate has around a 180,000 members across Medicare, Medicaid, and commercial plans. Point 32 Health has more than 1,000,000 members. Also, in November, Astana Health entered into a definitive agreement to acquire certain assets from Prospect Health System in Los Angeles, including Prospect's health
plan. In September, Indiana University Health said it plans to sell its insurance business to Anthem Blue Cross and Blue Shield for an undisclosed amount. In May, ProMedica in Toledo, Ohio sold its insurance subsidiary, Paramount Health, to the insurer, Medical Mutual of Ohio. Subsidiary, Paramount Health, to the insurer, Medical Mutual of Ohio. And back in 2023, Ascension Wisconsin finalized a deal to sell all of its stake in
the insurer, Network Health, to Froedtert Health. The Milwaukee system freighter is now the sole owner of network health, which offers health plans in 23 Wisconsin counties. And other health systems have chosen to close rather than sell their health plans. Southwestern Health Resources out of Farmers Branch, Texas is shutting down Care and Care, its Medicare Advantage Business at the end of this year.
And Michigan Medicine out of Ann Arbor said in November it plans to discontinue its health plan at the end of 2025 after experiencing significant financial losses over the last few years. And finally, Mary Washington Healthcare in Fredericksburg, Virginia closed its MA plan at the beginning of 2024. Well, CVS Health is laying off an additional 42 employees at Aetna's headquarters in Hartford, Connecticut after laying off 100 of employees at the insurer earlier this year.
Those layoffs will take place between January 25th February 7, 2025. Though all of the infect affected employees report to Aetna's Hartford headquarters, just 12 reside within the state. Back in October, Aetna reported that it would lay off more than 400 employees at Aetna. The layoffs are part of an initiative to cut more than $2,000,000,000 in costs at CVS.
Across the company, CVS is laying off more than 29100 employees as part of its efforts to cut costs, though that accounts for less than 1% of the company's workforce, and most of those jobs are in corporate roles. Also at Aetna, a former employee with the company has been sentenced to 5 years in prison in Ohio over his involvement in several
fraudulent claims schemes. The in individual pleaded guilty to 13 felony counts of insurance fraud, telecommunications fraud, tampering with records, identity fraud, forgery, and attempted theft, according to a November 26 news release from the Ohio Department of Insurance. He's also been ordered to pay $229,000 in restitution.
That sentencing in Ohio comes shortly after 2 other Aetna employees were arrested in Florida in November for allegedly orchestrating a $1,100,000 fraud scheme involving the submission of 42 false claims between 2019 and 2023. In Ohio, an investigation uncovered the individual's pattern of submitting altered documents, falsified claims, and identity theft to fraudulently secure payouts from multiple insurers, including Aetna.
Between November 2022 October 2023, the individual filed 21 fraudulent claims while employed at Aetna, receiving more than a $162,000 for false hospitalizations, accidents, and a fabricated cancer diagnosis. Additionally, he submitted fraudulent claims totaling over $67,000 to property and pet insurers.
Aetna told Becker's in a statement that the company is committed to maintaining the highest standards within its business practices and that it takes legal allegations seriously and cooperated fully with the Ohio Department of Insurance's investigation. If you'd like to receive more health care insurance news directly to your inbox every morning, subscribe to the Becker's Payer Issues e newsletter on our website at beckerspayer.com.