Exchange strategy focuses on getting ‘the right steps in place to ensure long-term stability’
Marilyn Tavenner was hired last year to take over leadership of America’s Health Insurance Plans, the industry’s leading advocacy group. Its members were struggling to get their bearings in the fledgling insurance marketplaces erected through the Affordable Care Act while Medicare Advantage and Medicaid managed-care programs were surging as business lines.
Tavenner had recently left her post as administrator of the CMS, an agency intimately involved in those arenas. Now, Tavenner is faced with the task of coaxing two of the largest U.S. health insurers back to the fold. UnitedHealth Group, the largest health insurer in the nation, dropped out of AHIP just before she was hired, and Aetna quit this month. Tavenner addressed the challenges ahead of AHIP and its members during an interview last week with Modern Healthcare insurance reporter Bob Herman. This is an edited transcript.
Modern Healthcare: Why did you make the decision to go to AHIP?
Marilyn Tavenner: There was actually a bit of a time-off period for me, where I entered retirement and public speaking. Then I was approached by the AHIP board chairman to come in for an interview. So there was, by the time I started, an eight- or nine-month period between jobs. But I certainly have had the pleasure of working with health plans, not just during the Affordable Care rollout, but on Medicare Advantage and Medicaid managed care. There were many opportunities for me to get to know health plans and how they functioned, both in the private and the government market.
MH: Do you perceive any conflicts of interest with the quick move, given the CMS’ authority over health insurers?
Tavenner: There are certain restrictions that I have in terms of approaching this administration and HHS, which I will honor until the end of this administration, but I don’t see it as a conflict of interest. I see it as an opportunity to continue to work with health plans and to try to provide access to the uninsured and quality healthcare.
MH: How would you describe your relationship with the Obama administration?
Tavenner: I haven’t had any contact with the Obama administration since I left the job. I joined the administration as the chief operating officer for a chance to work on all things Medicare and Medicaid, and I’m sure the relationship is fine. I’ve been very proud of my bipartisan outreach. When I was confirmed, Eric Cantor spoke on my behalf, and I think that’s an example of the bipartisan approach I took throughout my time at the CMS.
MH: What are the reasons behind the departures of UnitedHealth and Aetna from AHIP?
Tavenner: I think that is a great question, and one that I think you’d probably be better off asking either Aetna or United. I will tell you I have great working relationships with both. They’re both great companies, and it certainly is my intention to work closely with them as we go forward with our advocacy agenda.
MH: Do you think they will rejoin AHIP during your tenure, and are you doing anything to try to entice them back?
Tavenner: Certainly that door is open, and I have worked closely with both CEOs in the past and hope to do so in the future. We are looking at everything, from dues to governance to how we move forward with our advocacy agenda, which I think matches their advocacy agenda.
MH: What is AHIP’s strategy for 2016 and beyond?
Tavenner: When I arrived here at the end of August, we sat down with the board and talked about the four or five key points that are important to members, important to consumers and important to, I’d say, this country.
You will not be surprised to hear that one is Medicare Advantage. Medicare Advantage members are now probably over 30% of the overall Medicare population, and consumers like that plan. So we’ll continue to work on quality and cost and growing the Medicare Advantage
“We’ll continue to work on quality and cost and growing the Medicare Advantage membership.”
The second area is Medicaid managed care. Over 60% of all Medicaid in this country is now delivered through managed-care plans, so it is a big opportunity and a big challenge for us to make sure that we are delivering high-quality, affordable products to each state.
The third area is pharma pricing, and how do we work to help promote and produce solutions in that area. The fourth area has to do with delivery-system reform, and that’s everything from narrow networks to provider directories. And the fifth, and hopefully a theme that we keep throughout, is how the consumer fits into this model.
MH: What differentiates AHIP from other groups advocating for the same things, such as the new Better Medicare Alliance on Advantage?
Tavenner: Whether you’re a Democrat or a Republican, folks look at AHIP as the source of information. I certainly think that my background in Medicare Advantage and my background in Medicaid help, and I worked for four years in state government, running Medicaid programs, then had five years at the CMS. A great deal of that time was spent not dealing with the Affordable Care Act; it was dealing with Medicare fee-for-service and Medicare Advantage, and how to improve those programs.
MH: Drug pricing has been a contentious issue. How can AHIP change the conversation?
Tavenner: Some of the solutions that we have been promoting have been, how do we tie pharma and pharma pricing more closely to delivery-system reform, to value-based purchasing? How do we make sure that individuals are getting the right medication, that they’re adhering to that prescribed medication, and that there are actually savings—not only savings in terms of cost, but savings in terms of quality of life? We have not been in favor of price controls, although we have promoted more transparency around what goes into pricing.
MH: You didn’t mention the ACA insurance exchanges as a focal point, but many health insurers have said the exchanges are not working for them right now.
Tavenner: Everything that we would do with the exchange market (focuses on) how we get the right steps in place to ensure long-term stability. This is a brand new program.
MH: Some have criticized special-enrollment periods and proposals to standardize health plans options.
Tavenner: We recently responded to regulatory proposals for 2017, and you’ll certainly see that theme in there about control of special-enrollment periods, and not adding additional constraints around benefit packages. One of the things we’re interested in is, how do you have people look at this as long-term insurance, and how do you deal with premiums? And that was why the delay of the health insurance tax was so important to us.
MH: Will the suspension of the tax in 2017 help consumer premiums?
Tavenner: I certainly think it does equate to some lowering of premiums, but probably more importantly, there is a study by Oliver Wyman that points to about a 3% reduction.
MH: How do you view the push toward high-deductible plans and narrow networks?
Tavenner: I think narrow networks are here to stay, and I think that what goes along with that is the ability, whether it’s an employer or an individual, to understand who is in their network, and what that means for them in terms of quality and medical-cost changes. That’s the type of work with consumers that we’re promoting.
As far as copays and deductibles, I think they are probably here to stay in some fashion, and the question is, how do consumers learn how to work with copays and deductibles? How do they plan ahead? How do they know how to select, so that whether they’re picking a plan in an employer market or in an individual market, they understand what their copay and deductible responsibilities are, and have a way to fund it? I think it’s just part of the evolution of insurance, period.
MH: Have there been conversations with other plans about changing how AHIP is organized to align different member interests?
Tavenner: That’s the conversation that’s going on at the board level and will continue into the spring. We have both smallgroup and large-group meetings on different topics to make sure that our members—regardless of whether they’re coming from a major medical group, or a Medigap, or a health savings account, or a dental plan—that we’re meeting them where they need to be.
MH: Are there other plans that won’t be renewing their membership?
Tavenner: Not that I’m aware of, but that’s not something people always tell me. But right now, in talking with our members, they appear to be very satisfied with what we’re able to do.
MH: It’s a presidential election year. How do you view the healthcare political climate right now?
Tavenner: I wish I could be a little more specific. We’re all kind of waiting to see what happens in the primaries, and how things shake out over the next several months. Regardless of who ends up being the candidate on either side, healthcare will still be on the agenda.
MH: If a Republican is elected, do you foresee any possibility that the Affordable Care Act will be repealed?
Tavenner: I think we have to wait until November and see what plays out.
MH: As a former executive with hospital chain HCA, how do you view the spate of hospital mergers?
Tavenner: You’re talking about my background, which goes back to starting as a nurse, spending 20 years in a hospital system and 25 years with HCA. I don’t have a set policy on hospital consolidation. I think it very much depends on what’s going on in the market.