January 31, 2024

Another Flat Year For Medicare Advantage Before Risk Score Trends

The Centers for Medicare and Medicaid Services (CMS) announced the 2025 rate hike for Medicare Advantage will be relatively flat. This is similar to what happened in 2024 after big increases in 2022 and 2023.  The effective growth rate was up, but the phase-in of a new risk adjustment model basically offsets those gains. The final notice may push these numbers up a bit. If you include risk score trends, MA revenue could increase by about 3.7%. So real revenue should be up, but health plans don’t like thinking of it that way as they think risk score trends tie to increased medical exposure. 

I include all these articles here but read with caution as many reporters interpret things differently. In the end, this is not the worst news, but it is bad in the face of some major medical expense and utilization increases.  See my recent blog here for where MA is headed: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/

The CMS Fact Sheet is at the link.  Additional government releases and fact sheets here: https://www.cms.gov/newsroom/press-releases/cms-releases-proposed-payment-updates-2025-medicare-advantage-and-part-d-programs and https://www.hhs.gov/about/news/2024/01/31/cms-releases-proposed-payment-updates-2025-medicare-advantage-part-d-programs.html and https://www.hhs.gov/about/news/2024/01/31/biden-harris-administration-strengthening-medicare-protecting-and-serving-americas-seniors.html

Additional articles here: https://www.fiercehealthcare.com/payers/cms-proposes-37-pay-rate-increase-ma-plans-redesigning-part-d-program and https://www.modernhealthcare.com/politics-policy/cms-proposes-medicare-advantage-pay-cuts-2025-ahip and https://insidehealthpolicy.com/daily-news/cms-expects-37-ma-pay-bump-after-2024-s-advance-notice-tumult and https://www.statnews.com/2024/01/31/medicare-advantage-2025-proposed-payment/ .

(Some articles may require a subscription.)

#medicareadvantage #rates #payments

Link to Article

Cigna Will Sell Its Medicare Advantage Line To HCSC

Cigna will indeed sell its Medicare Advantage (MA) lives to Health Care Service Corporation, a Midwest Blues plan in many states.  Today, HCSC has just over 200k lives and will add about 600K more from Cigna.  Cigna CEO David Cordani has been itching to sell MA given the troubles it has had and to concentrate on Evernorth and commercial.  HCSC has wanted to expand to MA more broadly. The price is $3.3 to $3.7 billion, or between $5,500 and $6,200 per member. It includes some provider assets as well as a contract to use Cigna’s Express Scripts PBM for four years.

Additional articles here: https://www.fiercehealthcare.com/payers/cigna-inks-deal-sell-medicare-business-hcsc-37b-deal and https://www.modernhealthcare.com/mergers-acquisitions/cigna-health-care-service-corporation-medicare-advantage-deal and https://www.forbes.com/sites/brucejapsen/2024/01/31/cigna-to-sell-medicare-business-to-big-blue-cross-plan-for-33-billion/?sh=248625af3b57 and https://www.managedhealthcareexecutive.com/view/cigna-to-sell-medicare-businesses-to-hcsc-for-3-7-billion

(Some articles may require a subscription.)

#cigna #hcsc #medicareadvantage

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Good Kaiser Family Foundation Charts And Issue Brief On Medicare Drug Price Negotiations

The Kaiser Family Foundation (KFF) has published a chart collection and issue brief on the Inflation Reduction Act’s (IRA) Medicare drug price negotiations. It covers the ten drugs, the timeline, and public support.  The issue brief goes into great details on the law.  A great read! The Centers for Medicare and Medicaid Services (CMS) must send initial price offers to the ten drugs’ manufacturers by Feb 1 so negotiations can commence.

Issue brief here: https://www.kff.org/medicare/issue-brief/faqs-about-the-inflation-reduction-acts-medicare-drug-price-negotiation-program/

Listen to the podcast I did on drug prices and the new law: https://www.healthcarelabyrinth.com/5-modeled-in-part-on-processes-in-other-developed-countries-the-medicare-drug-price-negotiations-should-save-money-promote-better-outcomes-and-have-little-impact-on-innovation/

#ira #drugpricing #brandrugmakers

Link to Article

Great Analysis On Drug Prices Rising

A recent study from Vizient says drug spend is increasing due to the increasing number of prescriptions specialty and ultraspecialty drugs, additional indications for some expensive drugs and price hikes.


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FTC Challenges Drug Makers On Patent Claims

The Federal Trade Commission (FTC) is becoming very aggressive and challenging brand drug makers on their Orange Book patent declarations.  These declarations are used by generic makers to determine if they will enter the market. The FTC is challenging the validity of over 100 drug product patents.

#ftc #drugpricing

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A Happy Adieu To Aduhelm

Biogen is taking Aduhelm off the market.  The controversial Alzheimer’s drug shows the greed of drug makers and the need to reform the drug approval process, including the revolving door between the FDA and drugmakers.

Additional articles here: https://www.managedhealthcareexecutive.com/view/biogen-stops-selling-alzheimer-s-drug-aduhelm and https://www.statnews.com/2024/01/31/biogen-gives-away-rights-aduhelm/

(Some articles may require a subscription.)

#aduhelm #fda

Link to Article

Few Americans Know What Their Healthcare Is Going To Cost

Less than 20 percent of Americans know how much they will have to pay before receiving healthcare, according to a Bentley-Gallup Business in Society Report survey. About 95 percent of respondents said healthcare providers should make costs more transparent.

#healthcare #costs #coverage

Link to Article

— Marc S. Ryan

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