Providers Readying Opposition To 340B Pilot
Providers say they are in store for significant cash flow and operational problems if a 340B pilot proposed by the Health Resources and Services Administration (HRSA) goes into effect. Given interest in reform, HRSA proposed a voluntary pilot to allow brand drug makers to convert to a rebate on a small subset of drugs as opposed to an upfront discount in the drug discount program. The program is meant to help ensure availability of drugs to lower income populations. The 340B program pricing is 25%-50% less.
Providers fear the pilot will eventually become how the entire program is run. Brand drug makers support the change as they feel the program is not living up to the original intent. Indeed, studies show that eligible providers, often hospitals, are not extending the discounts to low-income populations and instead are pocketing the discount. Indeed, some studies suggest prices at 340B eligible facilities are higher than those that are not 340B eligible.
Providers complain that the pilot implementation timeline is far too aggressive and opposing comments will not be considered when submitted. Comments are due Sept. 8 and drug makers must apply by Sept. 15. Participants will be announced Oct. 1 for a pilot beginning Jan. 1.
Additional article: https://www.modernhealthcare.com/politics-regulation/mh-hrsa-340b-rebate-pilot-program-providers/
(Some articles may require a subscription.)
#drugpricing #340b #branddrugmakers #hospitals
Almost 6,500 Providers Bow Out Of BCBS Settlement
Nearly 6,500 providers, including some of the biggest names in healthcare, are opting out of a major settlement with Blue Cross and Blue Shield insurers. The providers object to a $2.8 billion agreement between providers and Blues insurers over anticompetitive conduct and price-fixing. This is one of a number of lawsuits alleging similar behaviors and more suits are being filed.
In addition to the cash settlement, BCBS plans must implement significant operational changes across 16 categories. These changes include how BCBS processes claims, communicates, contracts with, and makes payments to providers.
Providers argue they haven’t seen any significant changes.
Additional articles: https://www.modernhealthcare.com/insurance/mh-bcbs-settlement-lawsuit-mayo-clinic-henry-ford/ and https://www.beckerspayer.com/payer/nearly-6500-providers-opt-out-of-2-8b-bcbs-settlement/
(Some articles may require a subscription.)
#bcbsa #providers #antitrust
Medicaid Prior Authorization Reviewed
A study by healthcare policy group KFF and Health Management Associates finds that well more than half of the 36 Medicaid states that responded to a survey require insurers make standard prior authorization determinations in their Medicaid program within seven days or less. In January, new federal regulations will take effect that mandate that same time frame.
Seventeen states had a seven-day limit in place as of mid-2024, and 13 said they have a response time of below 72 hours for expedited determinations.
https://www.fiercehealthcare.com/regulatory/look-state-prior-authorization-medicaid
Kaiser Permanente Reports Q2 Financials
Kaiser Permanente reported good financial news for Q2, with $1 billion of operating income and $3.3 billion in net income. This compares with $908 million of operating income and $2.1 billion in net income in Q2 2024.
Consolidated operating revenues and expenses during the most recent quarter were $32.1 billion and $31.1 billion, respectively, up from $29.1 billion and $28.2 billion in the second quarter of 2024.
Kaiser now has about $63.9 billion of operating revenue in 1H 2025 and nearly $2 billion of operating income.
However, operating headwinds on the horizon could mean changes to the health system’s cost structure and implementing potential efficiencies.
#kaiserpermanente #margins
— Marc S. Ryan
