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Bipartisan Support For 340B Reform

Senators on both sides of the political aisle expressed support for reforming the 340B drug discount program at a Senate HELP committee hearing today. While some expressed urgency for reform, others said that more caution needs to occur with reform to ensure rural facilities are not hurt.

While hospitals have defended their use of the discounts over the years, independent studies question whether discounts are used to benefit the needy and that pricing at 340B-eligible hospitals can be more than at those ineligible for the program. In addition, many say that non-profit hospitals get far more benefit in tax exemptions than given back to poor Americans and charity care.

Senators championed transparency around how revenue is generated in the program and how it is spent as well as more audit dollars. As well, senators want hospitals’ and other facilities’ aggressive debt collection practices curbed and more resources used for uncompensated and discounted care.

The Trump administration is pursuing some reform, including a voluntary pilot to convert the upfront discount to a retrospective rebate. Brand drug makers are endorsing and opting in to the pilot. Bloated hospitals of course hate the change and scrutiny. They are simply protecting their inefficiency and unaccountable empires.

#340b #drugpricing #branddrugmakers #hospitals

https://www.healthcaredive.com/news/help-senate-hearing-340b-reform/803630

Molina Reels From Medical Expense

Molina Healthcare reported Q3 financials and cut its 2025 earnings guidance for the third time this year. It is citing high medical costs particularly in its Exchange line of business. Molina is not the first to report the Exchange medical trend concern. The impacts will only be worse in 2026 if Exchange credits expire, risk increases, and enrollment drops.

While Molina revenues beat analyst expectations, the plan missed on earnings. Molina is a Medicaid- and Exchange- dominant health plan with some Medicare Advantage (MA) lives. Molina posted a very-high medical loss ratio (MLR) of 92.6% in the quarter, up from 89.2% at the same time last year. Exchange plans hit a 95.6% MLR, up from 73% same time last year. Medicaid margins were strong but pressured from continued utilization. MA sees high utilization as well.

In other news, a mix of Exchange pullouts and some expansions (surprisingly). Aetna is fully exiting the Exchanges in 2026. Molina is pulling out of one-fifth of the counties where it sells health insurance exchange plans and also will not pay commissions in several states. Centene is contracting in some states but expanding counties in others. UnitedHealthcare, Cigna, Oscar, and Elevance Health are expanding in some existing states. Oscar is adding a few states. Other regional players are pulling out.

Additional articles: https://www.healthcaredive.com/news/molina-2025-guidance-cut-aca-woes-q3/803580/ and https://www.beckerspayer.com/financial/molina-cuts-earnings-outlook-a-third-time-amid-aca-challenges/ and https://www.modernhealthcare.com/insurance/mh-aca-plans-centene-cigna-oscar-2026/ and https://acasignups.net/25/10/20/which-carriers-are-bailing-aca-exchanges-altogether-2026 and https://www.modernhealthcare.com/insurance/mh-molina-healthcare-aca-markets-2026/

(Some articles may require a subscription.)

#molina #exchanges #margins #coverage #healthcare

https://www.fiercehealthcare.com/payers/molina-healthcares-shares-tumble-marketplace-costs-drag-q3-results

Employer Family Coverage Hits $27,000 A Year

Healthcare policy group KFF finds from its annual employer survey that family premiums for employer-sponsored health insurance reached an average of $26,993 this year. On average, workers contribute $6,850 annually to the cost of family coverage. Family premiums increased 6%, or $1,408, from last year. KFF says the cumulative increase in family premiums is 26% over the past five years.

KFF finds that more workers are in HSA-Qualified Plans as average deductibles have reached $1,886 per year.

Additional articles: https://thehill.com/policy/healthcare/5567473-health-insurance-costs-rise-2025/?tbref=hp and https://www.healthaffairs.org/content/forefront/annual-family-premiums-employer-coverage-rise-6-2025-nearing-27-000-workers-paying-6 and https://www.kff.org/health-costs/perspectives-from-employers-on-the-costs-and-issues-associated-with-covering-glp-1-agonists-for-weight-loss/ and https://www.kff.org/affordable-care-act/annual-family-premiums-for-employer-coverage-rise-6-in-2025-nearing-27000-with-workers-paying-6850-toward-premiums-out-of-their-paychecks/ and https://www.kff.org/health-costs/2025-employer-health-benefits-survey/

(Some articles may require a subscription.)

#employercoverage #healthcare #coverage

https://www.fiercehealthcare.com/payers/new-care-vs-health-insurance-average-family-job-based-coverage-hits-27k

Elevance Reports Good News But Cautions On Medicaid

Elevance Health reported relatively good financial news for Q3 but warned investors about challenges in the Medicaid market. Ongoing eligibility determinations as well as changes to state programs are increasing the acuity of its membership. The company said its Medicaid margins will drop 125 basis points year over year in 2026 due to the eligibility changes and high utilization. This is before widescale reductions take place under the One Big Beautiful Bill Act (OBBBA). Insurers have complained that state Medicaid rates have not recognized actual costs after post-pandemic policy shifts in enrollment.

The other major moving part is the expiration of the enhanced Exchange subsidies, which could leave a sicker cohort and increased risk and costs in that line as well. Elevance also trimmed its Medicare Advantage (MA) footprint to stabilize that line. Its Carelon services entity did not meet investor expectations.

Elevance posted a medical loss ratio, a marker of spending on patient care, of 91.3% — up compared to 89.5% same time last year. Elevance did post double-digit year-over-year growth for both revenue and profits. It had $1.2 billion in profit for the third quarter, up 17% from the $1 billion for the third quarter of 2024. Revenues for the quarter were $50.7 billion, an increase of 12.4% from the $45.1 billion reported in the prior-year quarter. Elevance had $5.1 billion in profit for the first nine months of 2025, down 8% compared to the $5.7 billion in earnings reported through the first three quarters of 2024. Revenues across the first three quarters of 2025 were $149.4 billion, an increase of 13.5% year over year.

In other news, Point32Health has cut an additional 254 jobs to reduce its costs.

Additional articles: https://www.fiercehealthcare.com/payers/elevance-health-shares-rise-premarket-q3-earnings-revenue-beat and https://www.healthcaredive.com/news/elevance-outperforms-q3-2025-warns-medicaid-challenges/803326/ and https://www.beckerspayer.com/financial/elevance-q3-income-up-over-17/ and https://www.beckerspayer.com/workforce/point32health-to-cut-254-jobs/

(Some articles may require a subscription.)

#elevancehealth #exchanges #medicareadvantage #medicaid #managedcare #margins

https://www.modernhealthcare.com/insurance/mh-elevance-health-medicaid-2026/

11^th Vote To Reopen Government Voted Down By Democrats

Senate Democrats voted against reopening the federal government for the 11th time Monday, making the government shutdown continue. The chamber voted 50-43 on the House-passed continuing resolution, which needed 60 votes to pass. The same three Democratic caucusing senators voted with Republicans and one debt-and-deficit-hawk Republican voting with Democrats.

At the same time, Senate Majority Leader John Thune, R-SD, said the government shutdown has dragged on for so long that the GOP-controlled House may need to come back to Washington to pass a new stopgap funding bill. There are just 4 weeks left on the measure passed by the House and failing in the Senate.

And Rep. Chip Roy, R-TX, floated the use of the “nuclear option” to end the shutdown and get around Senate filibuster rules that require a 60-vote majority to pass a bill. Thune opposes the idea. Thune is right on this.

Meanwhile, the Trump administration asserted it could lay off about 1,000 employees despite a judge’s ruling, but the judge weighed back in and barred it.

 Additional articles: https://thehill.com/homenews/senate/5563802-thune-house-dc-government-funding-shutdown/ and https://www.fiercehealthcare.com/regulatory/shutdown-tracker-cms-issues-billing-guidance-hhs-furloughs-32000-employees and https://thehill.com/homenews/5563484-senate-filibuster-republican-debate/

#governmentshutdown #congress #trump #healthcare #coverage

https://thehill.com/homenews/senate/5564176-government-shutdown-vote-senate

Medicare Advantage Plans Want Fewer Members

Modern Healthcare covers a real oddity – Medicare Advantage (MA) plans want fewer members. Given upside down financials right now and the need to get back to investor margins, MA plans are trying all things to ensure they do not get members into plans that are underwater or even less profitable. The past few years and into 2026, the plans are eliminating commissions on a number of their plans and products. In addition, marketing budgets overall appear to be being reduced dramatically.

The lack of commissions, reduced marketing, and overall contraction of offerings has led the Centers for Medicare and Medicaid Services (CMS) to predict an actual contraction of 900,000 enrollees in 2026 compared with 2025. I see why they see a sea change, but I still have my doubts that we will see an actual contraction. Clearly growth will come down from a reduced rate in 2025. It might even be flat perhaps. But contract? Wow that we are even talking about it. How times change.

(Article may require a subscription.)

#medicareadvantage #enrollment #marketing

https://www.modernhealthcare.com/insurance/mh-medicare-advantage-marketing-unitedhealthcare-aetna-centene

Hospitals Hate Price Reform: CHA Sues State Over Price Caps

The oblivious-to-the-true-healthcare-crisis hospitals are once again trying to cripple reforms to price in the system. The California Hospital Association (CHA) has filed a lawsuit against the state’s Office of Health Care Affordability, arguing the agency’s price caps on hospitals are unlawful and will threaten critical access to patients in need. Chicken Little is back!

The arguments are old news from the hospital lobby playbook. The main goal is to continue to safeguard bloated price masters and bureaucracies at the expense of the American people.

The state agency is imposing a 3.5% statewide spending growth target for 2025, declining to 3% by 2029, as well as lower targets for existing price outlier hospitals. The CHA hides behind the fact that premiums are increasing by 10%, arguing the efforts have not worked. Yet, much of that is utilization increases as well as price hikes at hospitals and for drugs – the two big areas increasing in healthcare.

Of course, America as a whole should push for such reforms as price, driven in large measure by hospital care, is a huge outlier in America compared with other developed countries. Because federal officials refuse to take the healthcare crisis seriously, more and more states are pushing reform by establishing various caps on hospital and other costs.

As a recent Health Affairs Forefront blog argues, hospitals are about a third of all healthcare and are highly concentrated. This in and of itself leads to high price and ongoing inflation. Hospitals are increasingly buying physicians to drive practice patterns to expensive hospital or hospital-owned settings.

States are using various price caps on hospitals, including for state insurance plans, caps in the commercial market, rate-setting for various lines of business, and even global all-payer rate-setting. As the authors note, these changes have the potential to save big dollars and right-size spending. This is what the hospitals really fear.

Another Health Affairs study finds that commercial insurance prices were 78% higher in hospital outpatient settings compared with ambulatory surgical centers in 2024. This is what hospitals are protecting.

In related news, another Health Affairs Forefront article finds that four years’ worth of federal price transparency rule filings have revealed costly inefficiencies, obfuscation, and an immensely complex system of payer-provider contracts and payments. Transparency has given us at least a glimpse at how broken price is.

Additional articles: https://www.healthaffairs.org/content/forefront/states-using-hospital-price-caps-save-money and https://www.healthaffairs.org/content/forefront/transparency-reveals-health-care-prices-and-billing-and-payments-system-need-overhaul and https://www.beckerspayer.com/research-analysis/commercial-insurance-prices-78-higher-in-hopds-vs-ascs-study/

(Some articles may require a subscription)

#hospitals #rates #margins #employercoverage #transparency #pricetransparency #healthplans 

https://www.beckershospitalreview.com/finance/california-hospital-association-sues-state-over-unattainably-low-spending-caps/

Oz Still Demanding Greater Medicare Advantage Accountability

At a Better Medicare Alliance event Wednesday, Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz declared his support for Medicare Advantage (MA) but argued the plans could improve in several areas. Specifically cited were improper payments and prior authorization. Oz previously announced a voluntary plan agreement to streamline and limit prior authorizations as well as a new CMS program to conduct risk adjustment audits on 100% of MA contracts every payment year.

The latter initiative was hit with a major roadblock when a federal judge struck the rule governing how the agency would carry out such audits. CMS did not respond to a request for comment on whether it plans to repromulgate the audit rule and Oz stayed mum during the event but has implied he wants to continue the robust audit efforts.

Oz specifically called out the use of home health risk assessments and the coding inflation that occurs through them. A number of studies indicate that many diagnoses reported on these assessments never end up reported on encounters by doctors.

Overall, Oz said he believes MA is important to tackling mounting costs and wants to team up with the private sector on solutions instead of relying on government dictates.

I have a risk adjustment blog running tomorrow at the blog tab.

#medicareadvantage #overpayments #riskadjustment #radv

https://www.healthcaredive.com/news/oz-medicare-advantage-upcoding-reform-support/802879

Lown Finds Overuse Of Unnecessary Back Surgeries

The respected Lown Institute, a healthcare researcher and policy group, has found that hospitals performed over 200,000 unnecessary back surgeries on older adults over a three-year period in Medicare. The hospitals billed a total of more than $1.9 billion for what Lown says are low-value services.

Lown also found that 60% of total overuse for spinal fusion/laminectomies came from the 10% of worst offender physicians. It notes that these unnecessary procedures cause a rise in serious complications. One example: spinal fusion complications occur in up to 18% of patients and can lead to stroke, pneumonia, or death.

Lown looked at Medicare fee-for-service (FFS) claims from 2021 to 2023 and Medicare Advantage (MA) claims from 2020 to 2022 for rates of spinal fusions/laminectomies and vertebroplasties that met the researchers’ criteria of a low-value procedure based on the patient’s clinical presentation at the time of admission.

There were disparities by facility in terms of the overuse. The Cleveland Clinic and the University of Michigan Health System had vertebroplasty overuse rates below 1%, while AdventHealth Orlando and Mayo Clinic Hospital Phoenix had 23% and 17% overuse. The same Mayo Clinic location scored well on spinal fusion/laminectomy overuse with a 6.3% rate, while the Hospital of the University of Pennsylvania had a 33.3% overuse rate and Stanford Hospital had one of 22.7%.

Interestingly, the procedures are among 17 services targeted in a new proposed Center for Medicare and Medicaid Services (CMS) voluntary prior authorization pilot called the Wasteful and Inappropriate Service Reduction (WISeR) model. This will run in six states for six years beginning Jan. 1.

CMS knows there is a problem here, yet it has put massive constraints on the use of prior authorization in MA through a 2024 rule that forces the private plans to follow the traditional FFS Medicare program policies and largely prohibits the use of MA plan criteria even if evidence-based. In fact, hospital admissions are now the exclusive decision of providers and not plans. With more and more providers owned by hospitals, they are likely being ordered by their hospital bosses to conduct such surgeries whether needed or not.

The 2024 rule should be revisited given the results of the Lown analysis.

#medicare #medicareadvantage #priorauthorization

https://www.fiercehealthcare.com/providers/medicare-spent-19b-unnecessary-back-surgeries-over-3-years-report-finds

More Star Rating News

Modern Healthcare has done a follow-up Star rating article. It notes that several provider-owned insurers saw big drops in the percentage of Medicare Advantage (MA) members in plans rated at least four Stars. Some Blue Cross and Blue Shield companies also reported declines. Startup insurers also had mixed reviews.

Among the plans getting hit:

• Blue Bross and Blue Shield of Alabama
• Clover Health
• Excellus Blue Cross Blue Shield
• Devoted Health (but it also had success in other areas)
• Sanford Health Plan
• Sharp Health Plan
• CommunityCare Senior HealthPlan
• Blue Cross and Blue Shield of Nebraska

Big Blue winners included:

• Blue Shield California
• Florida Blue
• Elevance Health
• Independence Blue Cross

(Article may require a subscription.)

#cms #medicareadvantage #stars #quality

https://www.modernhealthcare.com/insurance/mh-medicare-advantage-ratings-2026-bcba-clover-health