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February 27, 2024

Justice Department Launches Antitrust Investigation Of UnitedHealth Group With the ongoing cyberattack at Change Healthcare ongoing, The Wall Street Journal reports that the U.S. Department of Justice has an active antitrust investigation going on. It centers on certain relationships between the company’s UnitedHealthcare insurance unit and its Optum health services arm.  Optum is the largest service organization associated with an insurer corporately.  Optum’s tentacles are long and hit almost every area of healthcare. Health plans like Cigna and Elevance Health will be watching as they have dreams of having service units as big as Optum.  These service units generate huge revenue and margins as the business is basically unregulated compared with an insurer (which is confined by the minimum medical loss ratio (MLR) requirements in most products) Additional article here: https://www.reuters.com/business/healthcare-pharmaceuticals/us-launches-antitrust-investigation-into-unitedhealth-wsj-reports-2024-02-27/ #unitedhealthcare #antitrust #optum Link to Article Change Healthcare Cyber Attack Fallout Continues The Change Healthcare cyber attack continues to have

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February 26, 2024

Not All Is Rosy In Hospital Finance While the hospital industry is recovering overall from the COVID slump, recovery is not universal in the hospital industry. And there are still some bad barometers of financial performance overall. #hospitals Link to Article PBM Reform and Site-Neutral Policy May Not Be Included In Health Bill Due to the major threat of a government shutdown and no consensus yet on the issue, time is running out on passing substantive policy reforms.  Congress is looking at a very skinny health bill and that could mean the death of PBM reform and site-neutral policies this year. A partial or full prospective Medicare doc payment fix will likely still be included. I don’t like the tone and tenor of the PBM reform measures, but would like the site neutral reforms to begin. At the same time, Sen. Chuck Grassley wants a PBM reform vote given the

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February 23, 2024

Major Cyber Attack On United’s Change Healthcare Change Healthcare announced a major cyber attack on its systems this week.  The event shows how vulnerable major healthcare organizations can be.  Change is owned by The United Health Group, granddaddy of insurance and owner of prominent service entity, Optum.  Change rolls up to Optum.  The attack shows how far-reaching a successful penetration could be. Change is a vendor. It has various products and connects to health plans throughout the country.  It also connects to providers and pharmacies throughout the country. Change says the attacker was a nation-state associated cyber security threat actor.  Little else is known about how far-reaching the attack was or the fallout yet. Additional article here: https://www.modernhealthcare.com/cybersecurity/change-healthcare-outage-cyberattack-2024-update (Some articles may require a subscription.) #cyberattacks #healthcare Link to Article Surge In Weight-Loss Drug Costs Troubles States Interesting assessment of the surge in costs for weight-loss drugs in state employee health plans

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February 22, 2024

New Poll Suggests MA Enrollees Have Issues With Prior Authorization, But Some Use Added Benefits A new poll says Medicare Advantage (MA) enrollees are more likely than those in traditional Medicare fee-for-service (FFS) to experience care delays due to prior authorization, but they do receive supplemental benefits not in the traditional program. While the rates of such use can always be better, a 70% member-use rate is encouraging.  Still, it is indeed time for MA plans to show their value by encouraging the use of all of the added benefits at reasonable rates. Proposed supplemental benefits reporting rules will encourage this trend. Overall, MA plans need to educate members thoroughly on all benefits, lest critics and researchers build a case that there is no added value. The critics continue to argue massive overpayments, which I do not agree with. One point just does not resonate with me. About 12% of

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February 21, 2024

New CMS DSH Rule Will Reduce Medicaid Hospital Payments Medicaid disproportionate share hospital (DSH) payments are being cut by $8 billion annually for the nest five fiscal years based on a new rule finalized by the Centers for Medicare and Medicaid Services (CMS).  The rule is purported to rein in overpayments. A recent study suggested that a liberal formula calculation meant a third of all qualifying hospitals should not have received payments.  CMS has been pushing to reduce such payments in favor of broad coverage. Additional articles: https://www.fiercehealthcare.com/providers/many-disproportionate-share-hospitals-face-lower-medicaid-payments-under-new-final-rule and https://www.modernhealthcare.com/policy/medicaid-dsh-cuts-safety-net-hospitals-cms-final-rule (Some articles may require a subscription.) #medicaid Link to Article HCSC Believes In Medicare Advantage As Cigna decided its investment in Medicare Advantage (MA) was too much on the health plan side, Health Care Service Corporation (HCSC) agreed with most large insurers that MA investments made sense.  It paid $3.3 billion for about 600,000 Cigna MA lives, bringing its total

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February 20, 2024

Analysts Say Digital Health Facing Funding Challenges After record years of funding, digital health ventures are facing lean times to stay solvent. (Article may require a subscription.) #digitalhealth #healthcare Link to Article 2024 Financial Woes For Medicare Advantage Plans Excellent Healthcare Dive article on the potential financial woes for Medicare Advantage (MA) plans resulting from rising medical expense and insufficient rates.  I covered some of this in my blog here: https://www.healthcarelabyrinth.com/with-boom-over-will-medicare-advantage-collapse-or-adjust/ #medicareadvantage #rates Link to Article New Challenges For Providers On Medicare Drug Price Negotiations Interesting article on the impediments to provider entities suing on their fallout from the Medicare drug price negotiations. A judge found they have a lack of standing right now to sue. (Article may require a subscription.) #ira #drugpricing Link to Article AI Task Force In The House Similar to Senate interest, the House Speaker has formed a bipartisan task force on regulating AI in healthcare.

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February 19, 2024

A Look At Growing Provider-Payer Disputes In California A good article from Kaiser Health News (KHN) that looks at growing contract disputes between providers and payers.  This one was in CA, but this is occurring nationwide.  KHN mentions higher costs coming from provider consolidation as well as increasing leverage when payers merge. The Biden administration is on to something with its anti-trust initiative. #providers #healthplans #coverage #payments Link to Article Wakely’s Assessment Of The 2025 Medicare Advantage Advance Notice As it does each year, Wakely has issued its annual assessment of the advanced notice for Medicare Advantage (MA).  My analysis is here: https://www.healthcarelabyrinth.com/2025-rates-for-medicare-advantage-plans-look-tight/ . #2025 #rates #medicareadvantage Link to Article Dual Eligible Special Needs Plan Analysis By Kaiser Family Foundation The Kaiser Family Foundation (KFF) published a look at Dual Eligible Special Needs Plans (D-SNPs).  Among the findings: My own research shows that SNPs in general, most of it dual

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February 16, 2024

No Surprises Act Dispute Process Favors Providers The No Surprises Act (NDA) remains  a huge mess with volume 13 times higher than forecast for 2023.  What’s more, providers won 77% of arbitration cases and health insurers won in 23% of cases. The winning offers were above the qualifying payment amount, which is the median in-network rate. The good news is that 10 million surprise bills were avoided with the law in the first nine months of 2023.  The bad news is that providers are winning huge in the baseball-style arbitration as they do in other states that have it.  Studies show that rates and premiums rose in those states under the provider-friendly process.  Researchers say that will happen nationwide now.  Yet, providers continue to sue to get things even more slanted toward them.  Congress has to even the playing field.  But they won’t as lawmakers from both sides of the

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February 15, 2024

Cigna To Start Stock Buyback Cigna said it would repurchase $3.2 billion in stock as part of a repurchase of $5 billion of common stock over the first half of 2024. This will help enhance its stock price.  Cigna will get $3.7 billion for its Medicare Advantage sale to Health Care Service Corporation (HCSC) when it closes. #cigna #hcsc Link to Article New Bill To Establish “Essential Hospital” Designation Lawmakers are sponsoring a bill that would designate about 1,000 hospitals as “essential health systems” under federal statute.  This would provide a vehicle to shelter these hospitals from negative programmatic decision (similar to critical access hospitals and sole community hospitals) as well as target new dollars for health equity and related initiatives. Hospitals would need to meet certain Medicare or Medicaid thresholds. #hospitals #medicare #medicaid Link to Article Capitol Hill Interest In AI Legislation But Little Progress A good article on the interest

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February 14, 2024

Elevance Health Takeover Of BCBSLA On Hold Again Facing pushback from Louisiana regulators, the governor and some lawmakers, BCBSLA has again withdrawn its application for sales to Elevance Health. BCBSLA sought permission to transition to a for-profit entity. Additional article: https://www.modernhealthcare.com/mergers-acquisitions/elevance-health-blue-cross-louisiana-merger-called-off (Some articles may require a subscription.) #bcbsla #elevancehealth Link to Article Biden Administration To Scrutinize Middlemen In Drug Shortage Controversy The Biden administration has issued a Request for Information (RFI) about the role of drug channel middlemen in creating drug shortages. The middlemen include group purchasing organizations (GPOs) and drug wholesalers. About six entities dominate. The Federal Trade Commission (FTC) and the Department of Health and Human Services (HHS) are leading the effort. The agencies will look at market concentration, contracting practices, and regulatory exemptions. In addition, GPOs’ sole-source agreements that prevent hospitals and other providers from acquiring drugs elsewhere will be examined. HHS Press Release here: https://www.hhs.gov/about/news/2024/02/14/ftc-hhs-seek-public-comment-generic-drug-shortages-competition-amongst-powerful-middlemen.html Additional

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