340B Reform May Be Coming
Senate HELP Committee Chairman Bill Cassidy, R-LA, on Thursday released a years-long staff investigation of the 340B drug discount program and listed legislative reforms he may push to rein in practices that don’t meet the intent of the program.
Cassidy suggests the following:
- Annual reporting requirements for select covered entities.
- Potential changes to the definition of eligible 340B patients.
- Clarifications regarding contract pharmacies’ fees and the common use of the inventory replenishment model.
- Investigating the financial benefits contract pharmacies and third party administrators receive for administering the 340B program to make sure increasing fees do not disadvantage covered entities and patients.
A recent executive order from President Trump orders the conditioning of community health centers’ future grants to ensuring insulin and injectable epinephrine are made available to patients at the 340B discounted price or lower.
Additional article: https://www.fiercehealthcare.com/regulatory/sen-cassidy-releases-340b-report-recommending-greater-transparency-oversight-hospitals
(Some articles may require a subscription.)
#340b #drugpricing #communityhealthcenters #hospitals
Molina Reports Mixed Results
Rising costs in Medicaid and the health insurance exchanges depressed Molina Healthcare’s first-quarter performance, but the company Beat the Street in terms of earnings and revenue. Molina Healthcare saw net income slip less than 1% to $298 million as revenue grew 12.2% to $11.1 billion in the first quarter. The company reaffirmed its guidance of adjusted earnings per share of at least $24.50 this year.
Molina Healthcare said it has secured rate hikes from states for Medicaid that slightly outpaced their expectations, but it says they won’t be enough to offset higher expenses. It raised its Medicaid cost trend guidance.
Molina says long-term care, behavioral health and GLP-1 drug costs were major cost drivers in Medicaid.
Molina Healthcare’s exchange business also had lower-than-anticipated risk-adjustment payments.
On the M&A front, Molina says the pipeline is replete with opportunities.
Additional articles: https://www.healthcaredive.com/news/molina-mixed-q1-2025-medicaid-rates/746216/ and https://www.modernhealthcare.com/finance/molina-healthcare-medicaid-exchange-costs
(Some articles may require a subscription.)
#molinahealthcare #healthplans #margins #medicareadvantage #medicaid #managedcare #aca #exchanges #obamacare
https://www.fiercehealthcare.com/payers/molina-healthcare-sees-opportunities-more-acquisitions
More On Potential For Provider Tax Reform
I told you about the possibility of provider tax reform in Medicaid coming via a regulation that could be filed by the Trump administration. The Centers for Medicare & Medicaid Services (CMS) submitted a regulation to the Office of Management and Budget (OMB) that could upend the taxes, which would be a huge blow to states. About 30% of states’ total state matches come from various provider taxes.
Depending on what the rule actually does, it could show how powerful the Paragon Health Institute’s voice has become within the administration. Paragon has been active on Medicaid reform and recently launched a new landing page for Medicaid research.
In other news, The Wall Street Journal reported on how states use such taxes on providers to obtain a federal funding windfall and significantly increase Medicaid payments to providers. The Journal highlighted Universal Health Services (UHS) and said 68% of UHS’ pretax income in 2024 came from supplemental Medicaid payment programs, including state-directed payments. UHS netted $1 billion in such payments in 2024, up from $629 million in 2023. The Journal cited Paragon’s recent work on provider taxes, which the group characterizes as “money laundering.”
Additional articles: https://www.wsj.com/health/healthcare/medicaid-hospital-profit-republican-budget-cuts-f6a52407
(Some articles may require a subscription.)
#medicaid #providers #budgetreconciliation #congress #trump #spending #coverage
https://www.fiercehealthcare.com/payers/cms-may-soon-propose-medicaid-provider-tax-regulation
House Pushes Work Requirements Despite Poor Track Record
The House GOP says Medicaid work requirements would save $100 billion over ten years for Medicaid and are very interested in including it to help meet an $880 billion budget savings bogey. But the articles points out the negative record found in Arkansas and Georgia.
(Article may require a subscription.)
#medicaid #workrequirements #budgetreconciliation #coverage
https://www.modernhealthcare.com/politics-policy/medicaid-work-requirements-arkansas-georgia
Employer Costs Surging
Healthcare spending continues to surge for employer groups, says a new survey from insurance brokerage and consulting firm Lockton. The survey finds that 85% say surging prices are the biggest challenge, but employers have yet to make major changes to offerings. Employers say costs are rising between 6% and 8%.
(Article may require a subscription.)
#employercoverage #healthcare
ACOs Want Bonus Model Extended
The Accountable Care Organization (ACO) lobby has written to Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz to urge extension of the Advanced Alternative Payment Model (APM) bonus. The ACO lobby says these payments have encouraged greater participation in downside risk models, and letting the incentives expire could slow progress toward value-based care.
(Article may require a subscription.)
#vbc #acos #medicare
Preventive Services’ Future
The Health Affairs Forefront Blog has a nice quick summary of the recent Supreme Court oral arguments on the Brainwood case, which will decide the future of free preventive services under the Affordable Care Act (ACA). It gives a nice historical overview.
(Article may require a subscription.)
#prevention #preventiveservices #aca #obamacare
Drug Tariffs Could Lower Part D Savings From IRA
A good assessment of how the coming drug tariffs could actually lead to huge costs for Medicare and throughout the healthcare system, reduce savings from the Inflation Reduction Act (ACA), increase consumer costs, and cause drug shortages.
The article finds that generic drug manufacturers would be hit especially hard and notes that the manufacturers have razor-thin margins. This could lead to halting of production abroad and drug shortages. For those drugs that are available, prices would surge as the manufacturers would have no choice but to pass on the increased costs.
The analysis suggests that a 20-percentage point increase in the effective tariff rate on drugs could theoretically translate to approximately a 2.4% increase in overall health insurance costs. Premiums could go higher in Part D and cancel out any savings in Medicare Part D from the IRA.
#tariffs #drugpricing #medicare #partd
— Marc S. Ryan
