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340B Program Reform Coming The Trump administration indicated in several drug price reform announcements it would seek to reform the 340B drug discount program. Now, it is proposing a pilot to go down the reform path. The Health Resources and Services Administration (HRSA) is launching a voluntary program to test drug makers paying rebates versus issuing discounts upfront to the qualifying providers, which include some hospitals, federally qualified health centers, and other safety-net providers. The pilot will cover just a small subset of drugs, including those for diabetes, rheumatoid arthritis, and heart failure. Some brand drug makers attempted to convert to rebates but were stopped by the Biden administration. The Trump administration appears on board, although hospitals and other providers oppose the changes. But 340B badly needs reforms as the drug discounts are not truly being passed on by most providers, who pocket the discounts. Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-hrsa-340b-rebate-pilot-program-2026 (Some articles

More Insurer Financial News Medicare Advantage-dominant insurer Humana had better financial news than most insurers these days, but perhaps because of its earlier bad reports and its ongoing efforts to right its financial ship. Humana slightly raised its guidance on earnings, although it did have a decline in net income in Q2. Humana reported a net income of $545 million in the second quarter, down from a net income of $679 million during the same period last year. Lower MA revenue and high utilization spend continues to challenge Humana. The medical loss ratio was reported as 89.7%, high but in line with forecasts. Its Medicaid financials bucked trends. Its pharmacy unit was a bright spot. Humana says its projected loss in membership in MA will be lower than previously forecast – 500,000 vs. 550,000. In other news, Fitch affirmed UnitedHealth Group’s “AA-” rating July 30 but revised the company’s outlook to negative from

UnitedHealth Group’s Financial Woes UnitedHealth Group painted a bleak picture in its revised outlook for 2025. It significantly downgraded its projections for 2025 and reported a steep drop in earnings per share. Net income declined 19% to $3.4 billion. United says it will deemphasize sales of Medicare Advantage (MA) PPOs, eliminate unprofitable MA plans in 2026 that cover more than 600,000 people, and may exit some Exchange markets in 2026. United is seeing its MA costs spike well over forecast and they could go even higher, to as much as 10%. While most plans are hurting in MA, United’s problems seemingly came out of the blue and are right now worse than others. Costs are high in other business lines, too. Its normally strong services unit, Optum, also is feeling the pinch. And given its continuing financial woes, Humana is offering certain employees voluntary early retirement buyouts. Employees age 50

CMS Reins In Part D PDP Premium Stabilization Program The Centers for Medicare & Medicaid Services (CMS) released preliminary technical Medicare Part D bid information for contract year 2026. It released the national average monthly bid amount (NAMBA) and base beneficiary, which are used in bid preparation. CMS also announced it was again funding a special premium stabilization demonstration started in 2025 to keep premiums from rising dramatically. The culprit for rising premiums is largely the passage of cost-sharing limits in Part D in the Democrats’ Inflation Reduction Act. The Democrats did not adequately fund the changes and therefore pushed many of the costs to plans, which then had to increase premiums and cost-sharing and make other reductions. The IRA changes have badly impacted the financial stability of the standalone Part D offerings (PDPs). For 2026, the generosity of the demonstration will be less. In 2026, CMS is reducing the uniform base beneficiary premium

Centene Reports Huge Loss in Q2 After pulling its earnings guidance several weeks ago, Centene announced today a $253 million loss in the second quarter as it navigates significant cost pressures. Financials will be challenging in 2026 due to Exchange and Medicaid reductions in the recent budget bill. Its medical loss ratio (MLR) was 93%. It also received lower risk adjustment transfers in the Exchange than anticipated. Through the first six months of the year, the company brought in $95.4 billion in revenue and $1.05 billion in profit. Centene will update rates for the Exchange given higher adversity and the impact of the budget bill. It also hopes for higher Medicaid rates. Centene is the largest Exchange plan, with 5.8 million members in 29 states, and the largest Medicaid plan, with 12.8 million members in 30 states. Additional articles: https://www.fiercehealthcare.com/payers/centene-posts-253m-loss-amid-aca-marketplace-woes and https://www.modernhealthcare.com/insurance/mh-centene-earnings-medicaid-cuts-aca-market/ and https://www.beckerspayer.com/payer/centene-posts-253m-loss-in-q2/ (Some articles may require a subscription.) #centene

Could Bipartisan Healthcare Reforms Be In The Making? Senate Republicans say they are working on a bipartisan healthcare package to lower drug and health insurance costs. Democrats say they have not been brought into the process and are skeptical. Sen. Bill Cassidy, R-LA, who leads the HELP Committee, is leading the talks, with pharmacy benefit managers reform and stopping upcoding practices in the Medicare Advantage (MA) risk adjustment program at the top of the list of reforms. Further, a group of Republican senators, including Lisa Murkowski of Alaska, are pushing to extend the expiring Exchange enhanced premium subsidies. It appears that even conservative Senate Finance Chair Michael D. Crapo, R-Idaho, who chairs the Senate Finance Committee, is involved. #healthcare #riskadjustment #medicareadvanage #pbms #drugpricing https://rollcall.com/2025/07/23/republicans-plan-bipartisan-health-package-as-democrats-demur Prominent Insurer Executives Cover Major Issues A Modern Healthcare webinar had a number of prominent Medicare Advantage (MA) executives outlining concerns regarding recent announcements. First, they distanced themselves

With Friends Like These: No Love From GOP For Medicare Advantage At a House Ways and Means Committee’s joint oversight and health subcommittee hearing, GOP lawmakers declared that the Medicare Advantage (MA) program needs an overhaul and private plans need to be reined in. The primary complaints were risk adjustment upcoding and prior authorization abuses. They also argued MA is not saving money as promised. The hearing was contentious and could lead to either accelerated reforms from the Centers for Medicare and Medicaid Services (CMS) or possible inclusion of cuts in a future budget bill. But admittedly, so far Congress has not wanted to pull the trigger on MA reforms given the popularity among seniors. In other news, a good article on the Trump administration proposal to begin some site neutral payment reform in Medicare. Some hospital-owned outpatient facilities (just off-campus outpatient facilities) would be paid the same to administer