Health Insurance Premiums Are Stabilizing

http://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2018/08/16/health-insurance-premiums-are-stabilizing-despite-gop-attacks

Stateline Aug16

 

Despite Republican efforts to undermine the Affordable Care Act, insurance premiums will go up only slightly in most states where carriers have submitted proposed prices for next year. And insurance carriers are entering markets rather than fleeing them.

The improvements stem from less political uncertainty over health policy, steeper than necessary increases this year, better understanding of the markets, improvements in care and a host of actions taken by individual states.

Average proposed premiums for all levels of plans in California, Colorado, Delaware, Florida, Indiana, Nevada, Ohio and Pennsylvania will increase less than 9 percent in 2019, according to the Kaiser Family Foundation.

By contrast, this year’s mid-priced plans increased an average of 37 percent nationally compared to 2017.

In some states, 2019 premiums are projected to decrease. Prices also are expected to drop for people in a number of metropolitan areas, including Atlanta, Baltimore, Denver, New York and Washington, D.C.

And unless the Trump administration launches new attacks on the Affordable Care Act in the coming months, analysts believe the average increase across the United States will hold to the single digits.

To be sure, not all areas will fare as well. Some can still expect to see big increases next year, according to the Kaiser Family Foundation. For instance, proposed premium increases in Maryland average 30 percent for 2019.

(In some states, carriers have not yet had to file their rate proposals for 2019, but will in the coming weeks.)

But after a couple years in which carriers fled many markets around the country, insurers are planning to enter exchanges in many states, including Arizona, Florida, Michigan, New Mexico and Wisconsin. In some states, existing insurers are pushing into new areas.

“That they are entering markets is a sign that the insurers are pretty confident about those markets,” said Rabah Kamal, who analyzes health reform and health insurance for Kaiser.

“After several years of big losses, insurers are actually turning a profit,” said Kamal. “They’re doing well, so overall, there’s no justification for big increases.”

To a large extent, premiums in 2019 appear to be moderating because carriers raised rates higher than necessary in 2018 in reaction to the uncertainty over how Congress and the Trump administration might undermine the ACA. “It boils down to the fact that last year’s rates were too high,” said Emily Curran, a research fellow at Georgetown University’s Health Policy Institute.

Carriers also understand the marketplace much better than they did in 2014 when the exchanges were launched across the country, Curran and others say. Carriers have a better sense of who they are covering and how to predict their health risks, Curran said. Insurers and medical providers also have better coordinated care to reduce duplication.

State Roles

States also have had a major hand in stabilizing their markets, seeking to limit the damage the federal government is doing to the ACA.

Massachusetts had its own individual mandate before the ACA, and now New Jersey does as well. Three states, Massachusetts, New Jersey and New York, have passed outright bans on issuing short-term health insurance policies, while 12 others have adopted standards more restrictive than federal policy. Some states, including Alaska, Minnesota and Oregon, have also created state-funded reinsurance pools, which protect carriers from financially crippling individual medical claims.

Finally, a number of states have done their own outreach to publicize their exchanges and promote enrollment in the absence of federal efforts.

Pennsylvania is one of those states. The insurance market has stabilized there, said Jessica Altman, the state’s insurance commissioner. She projects the average state premium increase in 2019 will amount to 0.7 percent, compared to 30.6 percent this year. She said in 31 of 67 Pennsylvania counties, there will be more carriers selling policies next year compared to 2018. And, she said, many carriers are pushing into new territories.

Her agency estimates that the increase this year would have been only 7.6 percent absent the federal government’s elimination of cost-sharing reductions, which were federal payments to insurance carriers to cushion them from exorbitant individual medical claims.

“We had pretty significant increases last year, and we shouldn’t have,” Altman said.

Julie Mix McPeak, commissioner of the Department of Commerce and Insurance in Tennessee, where premiums are expected to fall and more carriers are intending to operate, said the ACA brought more than 200,000 Tennesseans into health plans — many of whom previously had not sought routine health care — which meant higher claims in the first years.

“We had a pretty negative health score in terms of dollars spent on claims because so many people coming into primary care had health issues that needed to be addressed. Now that they’ve been in care for several years now, we aren’t seeing those claims rising any more. They are leveling off.”

Whether the stability that appears to be settling the markets in 2019 will continue beyond that largely depends on what Washington does. “No one,” said Curran, “wants to see more uncertainty.”

Undermining the ACA

A Brookings Institution study released this month estimated that insurers on the health insurance market this year will enjoy an underwriting profit margin of 10.5 percent, up from 1.2 percent last year.

The study estimated that, absent federal policies disrupting the marketplaces, premiums would have dropped 4.3 percent nationwide in 2019.

Many health care analysts agree. “In cases where we are seeing modest increases, we might have seen decreases,” said Myra Simon, executive director of individual market policy for America’s Health Insurance Plans, a lobbying arm of the health insurance industry.

Steps taken by Republicans in Washington to undermine the exchanges include Congress’ repeal starting next year of the individual mandate, which requires all Americans to obtain health insurance, and the Trump administration’s decision to end the Obama-era cost-sharing reduction payments.

The administration also eliminated most funds for outreach to encourage enrollment in the markets and shortened the periods during which people could sign up for plans. In addition, the administration has moved forward with plans to loosen regulation on association and short-term health plans that don’t have to be as comprehensive as plans sold under the Affordable Care Act.

Health insurance analysts of all stripes had said those actions would draw people away from the insurance exchanges, particularly the young and healthy. Their departure, analysts said, could drive up premiums for all those remaining and set the markets on a “death spiral” that would ultimately drive all carriers from the exchanges.

The president has been clear about his intentions. “Essentially, we are getting rid of Obamacare,” he said in April.

But as carriers file their plans with state insurance offices for next year, it appears that warnings of imminent catastrophe were, at the least, premature.

“The administration has done almost everything on its list to destabilize the market or, in their words, ‘create more choice,’” said Chris Sloan, a director at Avalere Health, a Washington-based health policy research and consulting firm. “They’ve done it all and the market is still standing.”

 

 

 

Nobody loves the ACA as much as New Jersey

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New Jersey leads the nation in so many important things: rest stops named for historical figures, willingness to wear track suits in public — and now, reconstituting the Affordable Care Act under President Trump.

No state has moved faster or more aggressively to shore up its ACA markets than Jersey.

  • Yesterday, the Trump administration approved the state’s proposal for a new, five-year reinsurance program — essentially a subsidy that helps insurers pay for their most expensive customers, so they don’t have to pass those costs on through higher premiums.
  • That program will be paid for, in part, by New Jersey’s newly enacted individual mandate.
  • New Jersey also bans short-term insurance plans that don’t cover pre-existing conditions. The Trump administration has loosened the rules for those plans, but states are free to enact their own restrictions.

Those three policies — an individual mandate, a reinsurance program and limits on short-term plans — are states’ most muscular options for stabilizing their individual insurance markets, especially if they want to stick to the same core model of the pre-Trump ACA.

  • Right now, Jersey is the only state that has all three.

Meanwhile: The California State Assembly passed a bill yesterday to ban short-term plans.

The big picture: As more states — mostly blue states — restrict short-term plans and win approval for reinsurance programs, expect to see a deepening red-blue divide in state insurance markets and, as a result, in average premiums within the ACA’s exchanges.

2018 Mid-Term Healthcare Issues

https://www.washingtonpost.com/news/powerpost/paloma/the-health-202/2018/08/15/the-health-202-senate-democrats-stay-focused-on-health-care-even-during-short-august-recess/5b72f0901b326b4f9e90a72c/?utm_term=.2403975557c2

Senate Democrats used their truncated August recess to talk to their constituents about one key issue: Health care. 

And though they are returning to Washington tonight, they have no plans to stop talking about it. 

That’s a remarkable turnaround for Democrats who have been on the defensive about health care for the better part of a decade. Obamacare played a major role in their loss of control of the House in the first midterm election of President Obama’s presidency in 2010. But now, they’re hoping to take back the House and retain their seats in the Senate largely by running on the merits of the Affordable Care Act.

Over their 10-day mini break, Sen. Joe Donnelly (D-Ind.) held a roundtable discussion with voters about health care, as did Sen. Joe Manchin (D-W.Va.), who held his third roundtable this year focused specifically on pre-existing conditions. And Sen. Claire McCaskill (D-Mo.) also met with voters with pre-existing conditions on Tuesday.

“Cutting people off from insurance and making it harder for people to get insurance, we’re all still gonna pay the bill because in America we’re not going to stop people at the door at the emergency room and I’m sorry you don’t have health insurance, we’re gonna let you die,” she said, according to Missourinet.

In Nevada, Democratic Rep. Jacky Rosen, who is hoping to unseat GOP Sen. Dean Heller, also held a public meeting with voters with pre-existing conditions.  Sen. Bob Casey (D-Pa.) met with health care providers and patients to talk pre-existing conditions, and Rep. Kyrsten Sinema (D-Ariz.), who is vying for the open Senate seat there, also met with constituent groups to discuss health care.

“It doesn’t matter which community you are in, health care is the number-one issue that Arizonans are talking about,” Sinema told the Arizona Daily Star. “It is not just Arizonans who don’t have health-care coverage, many of those who are expressing concerns and fear are Arizonans who do have coverage but cannot afford it.”

As campaign cycles go, it’s still early in this one. And the deluge of ads will really heat up come fall. Republicans still see an opening to talk about rising costs of health care and President Trump continues to declare that the ACA is dead. But unlike years past when the GOP could run on an anti-Obamacare message, this year the party is more likely to focus on other issues like tax cuts and job creation. 

It’s harder for GOP candidates to make their case that health care policy is failing in the first election where they are in control of both houses in Congress and the White House. And recent scuttlebutt that Republicans would consider another repeal effort if they held Congress may not be helpful this cycle.

And so Democrats, if August activity is the precursor to the fall campaign, are going all in on health care. 

Earlier this month, the New York Times’ Margot Sanger-Katz had a great anecdote from an event with McCaskill. The senator, who may be in the toughest fight of her career, asked voters to stand if they have a pre-existing condition. There were reportedly few people left in their seats.

The Democrats and the groups who support them have homed in specifically on the warning that if the ACA is struck down, people with pre-existing conditions would lose protection. Notably, McCaskill and Manchin, two of the Democrats’ most vulnerable members, are running against state attorneys general who joined a lawsuit arguing the ACA should be deemed unconstitutional. If the law were struck down, it would take with it protections for people with past and current health conditions.

Before the Senate left, Minority Leader Chuck Schumer (N.Y.)  pledged to keep health care front and center this month in Congress, which is in keeping with Democrats’ election strategy this year.  Schumer’s office declined to show its hand, but on the floor he detailed exactly what the Democrats would be pushing for, including votes to protect people with pre-existing conditions and a Medicare buy-in program. They’re unlikely to get those votes, but that’s all part of the game plan to keep the attention on health care.

“The number one thing Americans want is health care, and we Democrats will spend August recess focusing on that issue, and forcing Republicans to cast votes or deny votes on those important issues,” Schumer said. “It’s a great opportunity, not just for Democrats, not just for Republicans, but for America. We are going to do it.”

The first television ad the campaign arm for the Democrats released in 2017 was about health care. It showed a man selling his car and a woman pawning her engagement ring. Then it cuts to them sitting at the hospital bedside of a sick child.

Most of the heavy ad buys are still to come, but an independent analysis of political ads so far this cycle found pro-Democrat ads have been overwhelmingly about health care.  According to Kantar Media/CMAG data by the Wesleyan Media Project, “An astounding 63 percent of pro-Democratic ads for U.S. House discuss healthcare, and 16 percent contain an explicit statement about being in favor of the Affordable Care Act. U.S. Senate contests are less likely to feature health care, but it is still the top issue, appearing in over a quarter (28 percent) of all ad airings.”

Take Rosen, the congresswoman running against Heller. She has a television ad that shows her talking to voters about their anxieties over the ACA being repealed. She says in the ad that ACA has “real problems,” but repealing it isn’t the answer. 

It’s a strategy divergent from previous years when Democrats were defensive of their support for Obamacare. They’d make macro arguments about the millions of people who would lose coverage without it. But now, with the focus on pre-existing conditions, they’ve found a way to make it personal and accessible for voters. 

“What we’re seeing on the trail is that health care remaining the defining issue of the election and voters are aware and concerned that GOP policies will increase their costs and jeopardize their coverage and voters are preparing to hold GOP candidates accountable on this issue,” said David Bergstein, a spokesman for the Democratic Senatorial Campaign Committee.

When asked, most Republicans will say they support keeping protections for pre-existing conditions. For example, when asked, McCaskill’s opponent, Missouri Attorney General Josh Hawley, said he thinks“insurance companies should be forced to cover pre-existing conditions.”

For his part, Hawley’s first television ad of the campaign was about his work as a clerk on the Supreme Court and accused McCaskill of supporting “liberal activist judges.”

In a press release in response to the ad, McCaskill’s campaign said, “Josh Hawley is suing to strip protections for nearly 2.5 million Missourians with pre-existing conditions.”

 

 

 

Health Care Industry Gears Up to Fight ‘Medicare for All’

http://www.thefiscaltimes.com/2018/08/10/Health-Care-Industry-Gears-Fight-Medicare-All

In anticipation of a “blue wave” election that brings more Democrats to Congress, the insurance and drug industries are gearing up to push back on the idea of a single-payer health care system.

The Hill’s Peter Sullivan reports that health-care industry forces have teamed up to form the Partnership for America’s Health Care Future, “which lobbyists say could run advertisements against single-payer plans and promote studies to undermine the idea.” The health care groups in the partnership, formed in June, include America’s Health Insurance Plans (AHIP), the Pharmaceutical Research and Manufacturers of America (PhRMA), the American Medical Association and the Federation of American Hospitals.

The idea of a single-payer or “Medicare for all” health-care system has gained momentum among Democrats, even as significant questions remain about how such a massive overhaul might be implemented and how to pay for it. “Industry groups are worried that support for single-payer is quickly becoming the default position among Democrats, and they want to push back and strengthen ties to more centrist members of the party to promote alternatives,” Sullivan writes.

The groups’ concern is more about the prospects of a Democratic single-payer platform in 2020, given that a host of the party’s potential presidential candidates have backed Bernie Sanders’ “Medicare for all” bill. “Every one of those organizations that’s in that group will look at Bernie Sanders’s single-payer and see massive losses of money,” John McDonough, a former Democratic Senate staffer who worked on the Affordable Care Act and is now at Harvard’s T.H. Chan School of Public Health, told The Hill.

The industry’s budding campaign could pose a formidable political and public relations challenge to proponents of a single-payer system. “Leaving aside whether single payer is good policy or not,” the Kaiser Family Foundation’s Larry Levitt tweeted, “it seems like the idea is going to eventually need some powerful institutional allies from somewhere to advance.”

 

 

How Medicare Was Won

https://www.thenation.com/article/how-medicare-was-won/

senior citizens supporting Medicare at the 1964 Democratic National Convention

 

The history of the fight for single-payer health care for the elderly and poor should inform today’s movement to win for Medicare for All.

In August of 1964, 14,000 retirees arrived by the busload in Atlantic City. Representing the National Council of Senior Citizens (NCSC), the former railroad workers, dressmakers, and auto assemblers marched 10 blocks up the fabled New Jersey boardwalk to the Democratic National Convention at the Convention Hall. The group, which was organized and bankrolled by the AFL-CIO, moved en masse in floral housecoats and sandwich boards with slogans like “Our Illnesses Burden Our Families” and “Senior Citizens Vote, Remember Medicare.” They intended to push President Johnson to extend public health insurance to millions of Americans.

Astonishingly, less than a year later, they won. Medicare was signed into law in July of 1965 in Independence, Missouri, at a ceremony attended by former president Harry S. Truman, whose push for national health insurance (NHI) had collapsed nearly two decades before. The landmark law created a public-sector insurance pool for Americans 65 and over, which remains today the closest thing to a robust universal entitlement in the US health-care system. Its successful passage (which also passed Medicaid, to insure the very poor) stands in sharp contrast to multiple failed efforts to install a universal single-payer system.

A half-century later, we’re witnessing the early stages of yet another popular thrust toward single payer, increasingly billed as “Medicare for All.” The nomenclature intends to evoke associations with the popular, trusted program, and is perhaps easier for Americans to latch onto than a phraseology that threatens to trigger a tedious lesson in comparative health policy. But if the conceptual jump from Medicare to Medicare for All can serve as a rough model for achieving universal health care in the United States, we should also look to the history of the social movements that achieved something that then, too, seemed impossible.

No one imagines expanding Medicare to all Americans will be easy. Nothing quite like this has ever been accomplished in the United States. Yes, dozens of peer countries have built coherent, humane, universal health-care systems out of entrenched private ones. Yes, mass movements have won major leftist reforms. Yes, advanced private industries of various nations have been nationalized. But human history offers no examples of these things happening in combination, which is what winning Medicare for All will require.

The most viable push toward NHI in American history crumbled in the late 1940s, ruthlessly crushed by not only insurers and pharmaceutical companies but also the American Medical Association. (Physicians, whose already handsome salaries began to rise in the postwar era, feared the blow that NHI could strike to their paychecks, professional prestige, and autonomy, since a government payer would also reduce their control over prices.) As such, the AMA famously shook down its membership for $25 apiece to fund the multimillion-dollar campaign that injected the phrase “socialized medicine” into mainstream American culture.

In this context, it’s perhaps tempting to view Medicare as a capitulation to industry pressure and political challenges, rather than as evidence they can be flouted. After all, Medicare (and, for that matter, Medicaid) targeted the most vulnerable patients. Many single-payer skeptics insist that Medicare managed to pass because it covered the people private insurance left behind. In his book Harry S. Truman Versus the Medical Lobby: The Genesis of Medicare, historian Monte Poen presents Medicare as a sort of compromise between the unfettered free market and the dashed dreams of the 1940s.

While it’s true that the enactment of Medicare didn’t pose nearly the threat to certain health-care-industry stakeholders that the NHI did or that Medicare for All would, it would be a mistake to fully dismiss its applicability to the current political fight. For one thing, the common talking point that Medicare extended insurance to a population who didn’t have it, rather than squashing existing private infrastructure, doesn’t bear out. A full half of elderly Americans did have private insurance plans when Medicare was signed into law. Commercial health insurers initially opposed the program, and began to support it only when it became clear a large administrative role would be preserved for for-profit insurers.

More importantly, while insurance companies certainly fought against health-care-financing reforms, physicians associations and hospitals are typically considered to have been the more significant opponents—they believed Medicare to be a likely conduit for eventual full-scale single payer (and all the government interference they assumed would come with it), and struck back with more or less the same zeal that they mustered decades earlier. As historian Jill Quadagno puts it, the AMA fought Medicare with “every propaganda tactic it had employed during the Truman era.” Such tactics included a widespread media blitz, advertising in doctors’ offices, and visits to congressmen from physicians in their districts. One tactic, called “Operation Coffee Cup,” deputized physicians’ wives to host ladies’ gatherings, at which they’d play their guests an anti-Medicare PSA starring actor Ronald Reagan.

This time, the AMA and its allies failed, but not for lack of trying. So it’s unfair to ascribe Medicare’s triumph to a lack of industry resistance, which was actually quite strong. The more crucial variable distinguishing Medicare from the NHI battles that fizzled before and since was a mass movement of people demanding it, having coalesced at a moment when powerful liberatory struggles against white supremacy and poverty had transformed what could be deemed politically possible.

Organized labor went all-in for Medicare, which took substantial pressure off unions for their retirees’ mounting health-care costs. Their enthusiasm contrasted with their relationship with universal initiatives before and since, despite their largely supporting most on paper. The reasons for labor’s tepid support for single payer have been debated by historians: For one thing, the unions’ success at collectively bargaining for employer-provided health benefits during the Truman-era reform battles perhaps reduced their motivation to prioritize national health-care solutions, the ongoing absence of which almost certainly highlighted the advantage of union membership. Since the 1970s, ever-rising health-care costs strengthened the case that labor’s interests would be served by removing health-care benefits from tense contract negotiations, but declining labor power during America’s rightward political shift tied them to a Democratic Party establishment unwilling to back single payer during the health-care debates of the 1970s and ’90s.

Today, with a slim majority of congressional Democrats vocally warming up to Medicare for All, and the ACA’s so-called “Cadillac Tax” poised to hit hard-won union-bargained health plans, the pro-labor case for single payer has never been more obvious. Indeed, each of the high-profile wildcat teachers’ strikes widely cited health-care benefits as a central demand. While the AFL-CIO has endorsed single payer, the question of whether workers will rally around Medicare for All they way they did for its namesake could well depend on how the movement’s stakeholders deal with those who stand to be displaced by the streamlining effect of large-scale reform.

But beyond institutional heft or the weight of its endorsements, the most impactful contribution organized labor made to the Medicare fight was a committed army of thousands of boots on the ground, many of them seniors who stood to benefit from the legislation or the family members who worried about how they’d care for them. Even the most precursory survey of 20th-century universal-health-care movements makes their most egregious failure stunningly obvious: They were nearly all top-down operations practically devoid of participation of ordinary people intent on changing the status quo.

By the time the NCSC marched in Atlantic City, this movement was already years in the making. It had been building momentum for the idea that would become Medicare in the 1950s, under a Republican president who, in is 1954 State of the Union address, had affirmed he was “flatly opposed to the socialization of medicine.” Rather than standing by waiting for better electoral luck, the Medicare movement fought to make theirs a winning campaign issue that would help to elect Democrats, not the other way around.

For years, the NCSC spearheaded letter-writing campaigns targeting media outlets and elected officials, and did any media outreach it could. It churned out brochures to counter the messaging of the powerful medical lobby, printing and distributing millions of pamphlets and fliers. As Blue Carstenson, then head of the NCSC, recounted later, “We had to make it a cause and we made it a cause…. We charged the atmosphere like a campaign…. We were always jammed in there and there was a hustle and bustle atmosphere. And when reporters came over they were always impressed by telephones ringing and the wild confusion and this little bitty outfit here that was tackling the whole AMA in a little apartment on Capitol Hill…. This was news. It used to make every reporter chuckle or smile.”

So too did the NCSC learn to push the buttons of electoral politics: It organized groups to testify before Congress about insurance premiums, which rose as much as 35 percent some years, like some ACA marketplace plans. And of course, Carstenson’s formidable elderly army turned out to campaign events. When Democrat George Smathers declined to support Medicare before the 1964 election, NCSC members organized town-hall meetings throughout the state—including one in Fort Lauderdale that was allegedly so successful that the organizers had to upgrade to a bigger venue three different times. Their message made appeals to all ages: Relief for seniors’ medical costs, they argued, will also reduce financial pressure on their working-age children, who’d in turn have more room in the budget to raise their own kids.

If the participants in today’s movement for Medicare for All intend to succeed, they must preempt the imminent counterattack of a health-care industry with far more fortunes at stake than the one their counterparts vanquished in 1965. This will require a mass mobilization of people making themselves seen and heard, whose demands for universal public insurance must reach a fever pitch to force candidates and current officials to capitulate. Doing so will demand a broad variety of tactics, including direct action, canvassing, printed materials, and public events, geared toward not only  persuading regular voters but also inspiring new ones.

Finally, this vision of justice must extend beyond the realm of health care alone. It is nearly impossible to imagine Medicare passing outside the political context set forth by the civil-rights movement, and the so-called War on Poverty. These years-long mobilizations of oppressed people had forced the political reckoning that fostered large-scale reform. It is no coincidence that the New Deal and the Great Society—however short they may have fallen—came about in large bursts rather than undetectable spurts.

Paradigm-shifting reforms have been delivered by broad coalitions confronting a common enemy. It’s up to advocates to compel people living under the US health-care system to see themselves and one another as part of a single constituency, from the poorest uninsured to those saddled with punishing paperwork, office staff chained to bad jobs for benefits, providers-turned-pawns of corporate conglomerates, and expectant mothers bracing themselves for exorbitant out-of-pocket costs atop weeks of unpaid maternity leave. And it must be done in solidarity with struggles on behalf of all oppressed Americans—people of color, the unhoused, the disabled, and others—whose subjugation benefits the very moneyed interests who’d prefer to keep things as they are.

All the evidence tells us that robust universal programs build solidarity, and create an impassioned base that enthusiastically defends them. Once Medicare for All is in place we can expect the same. Until then, it’s up to advocates to compel as many people as possible to envision the radically different society that stands to inherit it—and to accept nothing less.

CMS allows Medicare Advantage plans to negotiate Part B drug prices, implement step therapy

https://www.fiercehealthcare.com/payer/cms-allows-medicare-advantage-plans-to-negotiate-part-b-drug-prices-implement-step-therapy?mkt_tok=eyJpIjoiWlRsak1qTmpPV0poTVRBeCIsInQiOiI4TVwvbjloekN1OGJxWlJVTUw1djE5YXZkNlhONEpUQ3pXVFpmN3hlckFBcFRhSFBVRURkcCtVSmhpbVF0NlZoYkVmNVpHczVKbjBLXC9ZbjkxUlwvQVYrdm9FemhcL0FId3BmWkYzelg0a2tcLytaUEpHZ2VlU0dScldoRGJhWXlwUDlzIn0%3D&mrkid=959610

The Centers for Medicare & Medicaid Services (CMS) is giving Medicare Advantage (MA) plans more power in how they pay for Part B drugs.

The agency will allow MA plans to negotiate Part B drug prices with manufacturers, as well as to implement step therapy for Part B drugs. Plans will be required to pass half of the savings generated through negotiation to patients.

Negotiating Part B drug prices will foster competition and allow MA plans to get a better deal for their enrollees, according to CMS. These negotiations may also lead to price decreases in traditional Medicare.

The move represents perhaps the most significant step in the administration’s push to reduce drug prices, offering a new lever to combat ever-increasing costs.

Step therapy is a form of prior authorization that requires patients to try a “preferred” drug—that is, a less-expensive biosimilar— before the plan will cover a different, more expensive one. CMS says this will reduce costs for plans and beneficiaries alike.

Under the Affordable Care Act, at least 85% of plans’ savings must go toward healthcare services and quality improvement activities.

Further, the new policy requires “more than half of the savings required to be passed on directly to patients,” CMS said in a press release. A memo (PDF) from the agency says the savings may come in the form of “gift cards or other items of value.”

It is “unique that Medicare Advantage has not done this,” said CMS administrator Seema Verma in a press call on Tuesday evening, noting that traditional Medicare and private insurance plans have long been allowed to implement a step therapy policy.

MA plans will not be required to implement step therapy. Those that decide to do so must inform beneficiaries before the next enrollment period in October.

Verma added that patients and doctors can appeal the step therapy requirement through the existing appeals process.

The Pharmaceutical Care Management Association (PCMA), a trade association representing pharmacy benefit managers (PBMs), called the move “an important step toward reducing costs for the program and beneficiaries,” adding that “some of the highest priced drugs are found in Medicare Part B.”

Opponents of step therapy, who sometimes call it “fail first,” say limiting medication options can have negative consequences for consumers.

Step therapy policies “dangerously intrude on patient safety” and “weaken the doctor/patient relationship by negating the healthcare plan that they created together,” according to patient advocacy organization Fail First Hurts.

Part B drugs are either generally administered by a physician, administered via durable medical equipment, or otherwise specified by statute.

 

 

Healthcare Triage News: ACA Risk Adjustment is out of Danger. For Now.

https://theincidentaleconomist.com/wordpress/healthcare-triage-news-aca-risk-adjustment-is-out-of-danger-for-now/

Image result for Healthcare Triage News: ACA Risk Adjustment is out of Danger. For Now.

A few weeks ago, we were critical of the Trump administration’s handling of ACA risk adjustment payments. We’re fair-minded types around here, so we though you should know that they’ve taken steps to fix it.