October 9, 2024

Despite Some Cutbacks, MA Plans Are Going Big For Special Needs Plans

Given their potential for greater margin, Medicare Advantage (MA) plans appear to be making heavy investments in Special Needs Plans (SNPs) in 2025, even as they contract other products in certain areas. Done right, SNPs can generate 6.4% margins, compared with 2.8% for MA generally. This comes from 2021 data. As well, the plans are reacting to the Centers for Medicare and Medicaid Services (CMS) making the integration of Medicare and Medicaid funding streams a huge priority.

The growth continues a trend. SNP enrollment is about 6.6 million people this year, up 255% from 10 years ago, 125% from five years ago and 16% from 2023. SNP enrollment is projected to hit 7.2 million in 2025.

UnitedHealth Group, Humana, Elevance Health, CVS Health, Centene and Molina are all investing heavily. Some plans are contracting base benefits even in SNPs.

The growth is not without risk. CMS is undertaking heavy regulation of SNPs and could rein in risk adjustment (from which SNPs benefit a great deal). Significant new Medicare-Medicaid integration requirements are coming down the road as well.

(Article may require a subscription.)

#specialneedsplans #snps #medicareadvantage #cms #medicaid #medicare

https://www.modernhealthcare.com/insurance/humana-centene-unitedhealth-medicare-advantage-dsnp-snp-plans

KFF Find Major Increase in Employer Costs In 2024

A number of different employer surveys are showing up that discuss projected employer cost increases in 2024 and 2025. A number are projecting a 7% to 8% increase in overall employer group premiums in 2025. A new Kaiser Family Foundation (KFF) survey finds that employer group costs will increase by 6% to 7% in 2024. It seems to confirm many of the projections for 2025.

KFF’s survey finds that employer-sponsored health insurance in 2024 is $8,951 for single coverage and $25,572 for family coverage. This is an increase of 6% for singles and 7% for families from 2023.

KFF says over the last five years the average premium for family coverage has increased by 24%, compared with a 28% increase in workers’ wages and inflation of 23%.

On average, covered workers contribute 16% of the premium for single coverage and 25% of the premium for family coverage.  This is lower than in 2023, showing that employers continue to pick up the lion’s share of increases.

Read the summary of findings and other artifacts here: https://www.kff.org/report-section/ehbs-2024-summary-of-findings/ and https://www.kff.org/interactive/premiums-and-worker-contributions-among-workers-covered-by-employer-sponsored-coverage-1999-2023/ and https://www.kff.org/slideshow/2024-employer-health-benefits-chart-pack/ and https://www.kff.org/health-costs/report/2024-employer-health-benefits-survey/

Kaiser Health News (KHN) also has a great article on the fact that employers really know little about how their employer coverage works, especially in the drug area. A great read.

Additional article: https://www.modernhealthcare.com/insurance/employer-family-health-insurance-premiums-us-inflation-glp-1s and https://kffhealthnews.org/news/article/employer-drug-benefits-pbms-survey-kff/

(Some articles may require a subscription.)

#employercoverage #healthcare #coverage

https://www.fiercehealthcare.com/payers/kff-employer-family-premiums-rose-7-2024

Amazon Expanding Pharmacy Delivery Reach

Amazon plans aggressive pharmacy expansion and will offer same-day delivery of prescription medications in 20 new cities in 2025. This doubles the current footprint. By the end of 2025, nearly half (45%) of U.S. customers are expected to be eligible for same-day delivery. Amazon has recently struck deals with major insurers, including Blue Shield California, to be a key network provider. Expect this move to further these kind of deals.

#amazon #pharmacy #drugpricing

https://www.fiercehealthcare.com/health-tech/amazon-plots-big-expansion-pharmacy-business-expanding-same-day-delivery-20-cities-2025

CMS Unveils Drug List For Low-Cost Generic Model

The Centers for Medicare & Medicaid Services (CMS) released a list of 270 prescription drugs it wants to be included in a new Medicare $2 Drug List Model. CMS is attempting to further drive down generic costs to Medicare beneficiaries even as it tackles drug price negotiations with brand drug makers. Data show that prices of generic drugs are not uniform across Medicare Advantage (MA) or standalone Part D plans. As well, just one-fifth of enrollees get copays at this level for generics.

Some researchers have found that 38.3% of beneficiaries would have saved money from the $2 cap on monthly generic drug access in a previous year. They said savings were modest.

I have taken issue with the emergency demonstration program for standalone Part D plans. I call it extra-legal. I also acknowledge what the researchers have found. But this sounds like a reasonable use of CMS authority, aimed at uniformity and lowering costs.

Additional article: https://insidehealthpolicy.com/inside-drug-pricing-daily-news/cms-seeks-input-further-develop-medicare-2-generic-drug-list

(Some articles may require a subscription.)

#cms #partd #pdp #medicareadvantage #drugpricing #generics

https://www.fiercehealthcare.com/payers/cms-rolls-out-proposed-generic-drug-list-ease-cost-sharing-burden

CVS And United Ask For FTC Members To Be Barred From Overseeing PBM Suit

CVS Health and UnitedHealth Group Inc. said in a legal finding that members of the Federal Trade Commission who voted to sue pharmacy benefits managers should be barred from overseeing the case due to bias.

In other news, compound pharmacy entities are suing the Food and Drug Administration (FDA) over the ruling that Mounjaro and Zepbound are no longer in shortage.

Additional articles: https://www.modernhealthcare.com/legal/cvs-unitedhealth-ftc-insulin-lawsuit and https://thehill.com/policy/healthcare/4922234-trade-group-sues-fda-over-ending-mounjaro-zepbound-shortage/

(Some articles may require a subscription.)

#ftc #pbms #antitrust #drugshortages

https://thehill.com/policy/healthcare/4924741-unitedhealth-cvs-caremark-ftc-lawsuit

— Marc S. Ryan

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