Gloucester County Repricing Cover Letter 02032026.docx

Medical Claim Repricing Summary Date Cigna Healthcare

Medical Claim Repricing Summary

GLOUCESTER COUNTY

Date Purpose The following analysis has been completed by Cigna at the request of Gloucester County, and represents a commonly-requested means of understanding provider discounts that might be achieved by Cigna in a future policy year. We have completed this analysis on the historical medical claims for Gloucester County. Cigna is pleased to respond to your request for a medical claim repricing analysis.

Cigna’s Industry Standard Repricing Methodology Where possible, a detailed analysis is performed by repricing individual claims against current provider-specific Cigna contracts for the products and networks being considered for that policy year. This is referred to as “Provider-specific” or “Line-by-line” repricing.

When Provider-specific repricing is impossible, usually due to data limitations, we are often able to provide discount projections on a 3 digit zip code basis for each provider in a claims extract, and refer to this as a “Zip3-level” repricing.

For both repricing methodologies, the discount is defined as one minus the ratio of allowed charges to eligible charges, where:

Eligible charges are amounts submitted by participating providers for health care services, less charges for services not covered by the plan and claim duplicates.

Allowed charges are the amounts payable to providers after eligible charges are reduced for contractual payment provisions. Reductions in payments due to coordination of benefits and member cost sharing are not applied to reduce the allowed amount.

Individual claims were matched to our list of providers and the current provider-specific contract/fee schedule. Based on the procedure code and quantity of service provided, the specific allowed amount or discount percentage was applied to the billed charges, and then the discount is computed and summarized to an appropriate reporting level.

To determine if a provider was in Cigna's network, a combination of provider TIN, name, address, and zip were used. An automated algorithm was applied to do this match and any fallout was reviewed to ensure we had the best match possible. A portion of the fallout was driven by the fact that providers bill under multiple TINs.

The discounts by medical service category were determined under the following methodology:

Inpatient – The specific provider's current contracted average discount for inpatient services was applied to the claim.

Outpatient – The specific provider's current contracted average discount for outpatient services was applied to the claim.

Professional – The specific provider's current contracted average discount for professional services was applied to the claim.

We used the combination of Place of Service, Type of Service/Provider, Claim Type, and/or Provider Specialty to separate into the respective service type categories.

In rare situations we are unable to reprice using provider specific discounts/contracted rates, Cigna book of business zip 3 discounts are applied based on the zip code and major service category of the claim line.

Exclusions We did not reprice the following types of claims:

Dental, Pharmacy, and Vision – only medical claims were repriced Anesthesia and Transportation/Ambulance where the par status of the provider cannot be determined Claims where the par status of the provider cannot be determined Claims where the geography and/or type of service could not be determined Based on the methodology employed, various data limitations can cause a claim line to be excluded Repricing Limitations Cigna makes no guarantee of the impact of the actual financial results in this repricing analysis. There are a number of factors, many of which are discussed in this report, which could cause the actual financial results to vary from the results presented in our analysis. However, when appropriate, Cigna is willing to provide a guarantee. Please contact your Sales and Under-writing partners for additional detail.

Also, a Repricing analysis does not constitute, nor replace, a Provider Disruption analysis. Data quality and methodologies employed on a repricing analysis can cause in-network charges as a percent of total charges to vary from actual financial results. Please contact your Sales partners for additional detail to obtain a Disruption Report.

Please let me or your Sales and Underwriting partners know if you have any questions or would like to discuss the analysis further.

Best Regards, Darren Hamilton Phone: (216) 642-1719 Email: Darren.Hamilton@evernorth.comConfidential, unpublished property of Cigna Healthcare. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2024 Cigna Healthcare Confidential, unpublished property of Cigna Healthcare. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2023 Cigna Healthcare image1.emf