Drugs: Trump May Propose MFN; PBMs Using Various Ways To Control GLP-1 Costs
Politico reports exclusively that Donald Trump is on the verge of proposing most-favored nation (MFN) pricing, the strictest form of international reference pricing, to lower drug costs. The executive order would cover the Medicare program for now, but recently the president urged MFN for Medicaid as well. The move would be a major confrontation with the brand drug industry. I have argued Trump’s populism would win out here and he would propose something like this. My blog on the topic: https://www.healthcarelabyrinth.com/expect-big-things-from-donald-trump-on-drug-prices/ .
In other news, pharmacy benefits managers (PBMs) are using various and disparate ways to reduce GLP-1 weight-loss drug trends. CVS has dropped Zepbound in favor of Wegovy in the commercial world. It is also using NovoCare, Novo Nordisk’s direct-to-consumer platform for GLP-1s. Humana will also use NovoCare.
In 2024, Cigna launched EncircleRx, a program that controls the cost of GLP-1 medications for employers. The program has grown to 9 million enrollees in a year.
Given high costs, many employers are dropping coverage for weight loss.
Additionally, The Wall Street Journal attacked Donald Trump for proposing drug price reforms. Of course, Trump is right on this one and I have written about it. What was once a great editorial page, The WSJ has increasingly abandoned their economic principles in favor of shilling for big business no matter what. What the Journal misses is that the drug market is not a free market and reforms need to occur.
As well, Health Affairs Forefront has a blog detailing the so-called small molecule drug “pill penalty.” Trump wants to make a concession here by perhaps moving the Medicare drug price negotiation period out four years for these drugs to match other drugs. The authors argue there will be major lost savings. Perhaps some drugs should be reduced by two years and small molecules moved out two years. That would throw Big Pharma even more.
Additional articles: https://www.beckerspayer.com/payer/payers-split-on-glp-1-strategy/ and https://thehill.com/homenews/media/5289600-wall-street-journal-donald-trump-executive-order-drug-prices/ and https://www.healthaffairs.org/content/forefront/costs-extending-small-molecule-exemption-period-medicare-drug-price-negotiation
(Some articles may require a subscription.)
#employercoverage #medicareadvantage #partd #humana #cvshealth #aetna #cigna #glp1s #weightlossdrugs #drugpricing #ira #brandrugmakers #medicaid #commercial #medicareadvantage #partd
https://www.politico.com/news/2025/05/07/trump-sweeping-medicare-drug-price-plan-00334167
Budget Saga: Upset Conservatives and Medicaid Provider Taxes Focus Of Budgeteers
Conservatives in the House are upset by Speaker Mike Johnson taking reductions to the reimbursement on the Medicaid expansion population off the table. In addition, they are calling the speaker out for throwing cold water on the feasibility of per capita caps.
Lawmakers are paying more attention to reining in provider taxes, which conservatives argue is a mechanism to leverage more and more federal reimbursement. They want to phase it down or eliminate it, which could save as much as $600 billion over ten years.
In other news, Democrats are arguing that the GOP should attack Medicare Advantage overpayments and risk adjustment upcoding instead of Medicaid. They cite a congressional Medicare policy arm, MedPAC, analysis (which I think is inflated) that says MA plans are over-reimbursed by over $80 billion annually.
My blog on this issue earlier today: https://www.healthcarelabyrinth.com/stuck-in-the-mud-the-budget-reconciliation-quagmire/ .
Additional articles: https://insidehealthpolicy.com/daily-news/house-ec-eyes-may-13-reconciliation-markup-hospitals-ramp-lobbying-provider-taxes and https://rollcall.com/2025/05/07/conservatives-chafe-at-taking-medicaid-savings-options-off-table/ and https://thehill.com/policy/healthcare/5290279-democrats-say-target-medicare-advantage-not-medicaid/
(Some articles may require a subscription.)
#budgetreconciliation #congress #trump #medicaid #spending #coverage #medicareadvantage
Oscar Sees Aetna’s Exchange Exit As Opportunity
At its investor call this week, Oscar Health CEO Mark Bertolini said that Oscar views Aetna’s exit from the Exchanges as an opportunity. Aetna has about 1 million members nationwide in the Exchanges and Oscar has a great deal of overlap with Aetna. While Aetna was losing money in the exchanges, Oscar has successfully created a model in what is a risky program. That risk will increase if the enhanced premium subsidies expire and millions leave the program due to higher premiums. Enrollees will pay much more because they would get lower subsidies and insurers will hike premiums due to adverse severity increasing.
#oscarhealth #aetna #exchanges #obamacare #aca
https://www.beckerspayer.com/payer/oscar-health-sees-opportunity-from-aetna-market-exit
Arizona Reforms Prior Authorization And Claims Denials
Arizona’s legislature has passed a bill that mandates health insurers to have a medical director independently review all claim denials based on medical necessity. In addition, similar processes will occur for upfront prior authorizations. The bill requires the medical director to exercise independent medical judgment and bans relying solely on external recommendations.
The bill goes to the governor soon and will be effective June 30, 2026.
#priorauthorization #healthplans #providers
— Marc S. Ryan
