HealthCare Roundtable e-News – November 20, 2023

Top News

Connecticut Pioneers Innovative Approach to Tackle Soaring Costs of Weight Loss Drugs in State Employee Health Plan

Connecticut’s state employee health plan, covering 265,000 employees, including teachers, police officers, and firefighters, faced a potential expenditure of $30 million on weight loss drugs for diabetes treatment. Rather than discontinuing coverage like some other large employers, the state implemented a unique approach. Since July, plan members seeking weight loss drugs must first participate in a clinical lifestyle management program called Flyte, offering online tools and personalized care plans. The program aims to control costs by encouraging alternative treatments before prescribing costly medications like Novo Nordisk’s Ozempic and Wegovy. The early results show promise, with a decrease in new prescriptions and potential cost savings.

The escalating costs of these weight loss drugs, proven effective for conditions exacerbated by obesity, pose financial challenges for state and federal officials. The drugs’ high prices, around $1,000-$1,300 per month, create a dilemma for public and private organizations grappling with coverage decisions. While some employers, like the University of Texas, dropped coverage due to rising costs, Connecticut’s experiment with a comprehensive approach, combining lifestyle management with drug coverage, presents an innovative model that could influence how other organizations navigate the financial implications of these blockbuster treatments.

 

Navigating Rising Healthcare Costs: Innovative Strategies in State Employee Health Plans

Premiums for employer-sponsored health insurance are expected to increase this year after several years of below-average hikes. This rise in premiums will impact workers’ take-home pay and out-of-pocket costs, as employers pass on increased healthcare costs to employees during the open enrollment season. State and local government employees, numbering over 15 million, are also facing the impact of higher healthcare costs. The Center on Health Insurance Reforms’ recent survey of state employee health plans (SEHPs) reveals that rising prescription drug prices and hospital service costs are the primary drivers of cost growth for SEHPs. While most SEHPs focus on reducing the use of healthcare services to control costs, promising strategies include reference pricing, tiered network plans, and multipayer purchasing initiatives. Reference pricing, where provider payments are pegged to a reference price, has shown significant savings in states like Montana and Oregon. Tiered network plans, dividing providers into tiers based on performance, offer lower costs and increased acceptance by plan enrollees. Collaborative multipayer initiatives, where health care purchasers and payers align their purchasing strategies, aim to overcome market dynamics driving higher prices. These innovative approaches, if successful, could have broader implications for controlling healthcare costs across the market.

 

President Biden Signs Two-Step Continuing Resolution to Extend Government Funding: Key Agencies Funded Until January 19, Health and Human Services Until February 2

A two-step continuing resolution (H.R. 6363) extending government funding for some agencies and programs until January 19 and funding for others until February 2 was signed by President Biden on Thursday night, after passing through the House and Senate earlier this week. The first step extends funding for four spending bills through January 19:

  • Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2023
  • Energy and Water Development and Related Agencies Appropriations Act, 2023
  • Military Construction, Veterans Affairs, and Related Agencies Appropriations Act, 2023
  • Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2023

The second step extends funding for the remaining eight bills including funding for the Department of Health and Human Services (HHS) until February 2. Passage of this resolution includes no renewals of some health care programs like the Pandemic and All-Hazards Preparedness Act and the SUPPORT Act which have expired, however the continuing resolution does include some preparedness funding.

Administrative Action

  • Healthsperien published its comprehensive summary of the calendar year (CY) 2024 Medicare Physician Fee Schedule (MPFS) and Quality Payment Program (QPP) final rule. Released on November 2, this final rule includes updates on policy changes for Medicare payments under the Fee Schedule, and other Medicare Part B issues, on or after January 1, 2024. The Centers for Medicare and Medicaid Services (CMS) notes this final rule is one of several final rules that reflect a broader Administration-wide strategy to create a more equitable health care system that results in better access to care, quality, affordability, and innovation. For additional information please see CMS’s CY 2024 MPFS Fact Sheet and CY 2024 Quality Payment Program Fact Sheet.
  • The Department of Health and Human Services (HHS) through the Centers for Medicare and Medicaid Services (CMS), released the Request for Applications for the new Guiding an Improved Dementia Experience (GUIDE) Model (fact sheet), which aims to improve the quality of life for people living with dementia and reduce strain on their unpaid caregivers. A primary goal of the model is to help beneficiaries remain in their residences and communities longer, as the course of disease for dementia can be drawn out and decompress skilled nursing facilities while generating savings for Medicare. The model will assist people with dementia and their caregivers through access to care navigators who can connect them to clinical and non-clinical services, including meals and transportation via community-based organizations. Caregivers will also have access to training programs on best practices for caring for a loved one living with dementia. The GUIDE Model will be an 8-year voluntary national model beginning with Performance Year 1 on July 1, 2024—for established programs—and is available to participants who deliver supportive services to people with dementia, including person-centered assessments and care plans, care coordination, and 24/7 access to a support line.
  • The White House, in conjunction with the U.S. Department of Health and Human Services (HHS), announced they are taking significant steps to enhance the coordination of health care, public health, and social services at the federal, state, local, and tribal levels. The White House is introducing the U.S. Playbook to Address Social Determinants of Health, the nation’s first-ever comprehensive guide in this domain. Simultaneously, HHS is releasing a Call to Action to Address Health Related Social Needs and a Medicaid and CHIP Health-Related Social Needs Framework. These initiatives align with the administration’s commitment to advancing health equity by recognizing the influential role of social and economic conditions in individuals’ well-being.

Congressional Action

  • On November 14th, the Senate Finance Committee, Subcommittee on Health Care, held a hearing on “Ensuring Medicare Beneficiary Access: A Path to Telehealth Permanency”. Subcommittee members discussed the importance of providing telehealth services to Medicare beneficiaries and heard from a panel of four telehealth experts. Specifically, they discussed the importance of providing consistent and high-quality access to health services virtually, addressing major concerns that both subcommittee members and the panel see as potential downfalls of the health care system if telehealth services are not made permanent for Medicare beneficiaries. The witnesses each noted that telehealth services are crucial to rural areas of the country that do not have access to in-person visits with ease. A key component of the hearing included a bipartisan effort to increase telehealth services to those more disproportionately affected by long-travel times to clinics and poor access to broadband coverage.
  • The US House of Representatives Energy & Commerce Health Subcommittee held a markup on 21 legislative proposals on topics including pharmacy benefit managers (PBMs), innovative medical devices, and improving overall health care for the nation’s seniors. There was bipartisan consensus surrounding increasing transparency in the actions of PBMs, referring to the price gouging tactics used by the industry. Representatives highlighted additional fees imposed by PBMs that are disproportionately affecting small, rural pharmacies. These fees also lead to higher out-of-pocket costs for seniors attempting to access their medication, creating another barrier to quality care for an already underserved population. In tandem with increasing the quality of care for seniors, the subcommittee discussed expanding access to innovative medical technologies by removing the delay in Medicare reimbursement that medical device companies face after receiving approval from the Food and Drug Administration (FDA), which can sometimes take up to six years. There were mixed sentiments regarding the possibility of automatic reimbursement for innovative medical device companies, with some Democrats arguing that it would place billions of dollars directly into corporations’ pockets, while some Republicans insisted that it would allow access to technologies to improve the lives of seniors.
  • Senate Finance Committee Health Subcommittee members discussed the importance of providing telehealth services to Medicare beneficiaries and heard from a panel of four telehealth experts. Specifically, they discussed the importance of providing consistent and high-quality access to health services virtually, addressing major concerns that both subcommittee members and the panel see as potential downfalls of the health care system if telehealth services are not made permanent for Medicare beneficiaries. The witnesses each noted that telehealth services are crucial to rural areas of the country that do not have access to in-person visits with ease. A key factor of the hearing included a bipartisan effort to increase telehealth services to those more disproportionately affected by long-travel times to clinics and poor access to broadband coverage.
  • The Senate Finance Committee, Subcommittee on Health Care, held a hearing to discuss the importance of providing Medicare Beneficiaries telehealth services permanently. Subcommittee members discussed in detail the importance of providing telehealth services to Medicare beneficiaries, hearing from a panel of four telehealth experts. The hearing discussed in great deal the importance of providing consistent and high-quality access to health services virtually, addressing major concerns that both subcommittee members and the panel see as potential downfalls of the health care system if telehealth services are not made permanent for Medicare beneficiaries. The witnesses each noted that telehealth services are crucial to rural areas of the country that do not have access to in-person visits with ease. A key factor of the hearing included a bipartisan effort to increase telehealth services to those more disproportionately affected by long-travel times to clinics and poor access to broadband coverage.

Medicare

The Medicare Payment Advisory Commission (MedPAC) held its November public meeting to discuss several issues related to Medicare payment policy. Specifically, the Commission held sessions on: Mandated report: Dual-eligible special needs plans. Hospice: MedPAC workplan. Medicare coverage of and payment for software as a medical service: An overview. Favorable selection in Medicare Advantage. And Evaluating access in Medicare Advantage: Network management and prior authorization. Healthsperien was there to cover the November MedPAC meetings. Click here to access Healthsperien’s comprehensive summary.


Healthcare Roundtable 2023 Corporate Sponsors