Older Adults Most Concerned About Healthcare Costs Ahead of Election

By Sophie Putka - Ahead of the 2024 election, five of the top six health concerns of adults 50 years and older were related to costs of healthcare and health insurance, a nationally representative survey found. Read Full Article…

HVBA Article Summary

1. High Concern Among Older Adults: The study conducted by John Ayanian and his team at the University of Michigan highlighted that 56.3% of participants, consisting of older adults, are "very concerned" about the costs associated with home care, assisted living, and nursing home care. This top concern reflects broader anxiety over healthcare expenses, with other significant concerns including the costs of medical care, prescription medications, and health insurance.

2. Demographic Variations in Concerns: Analyzing the demographic differences, the study reveals that women are more concerned than men about healthcare costs, and political orientation also influences concern levels, with liberals expressing higher worry than moderates and conservatives. Additionally, there is a notable difference in concern between residents of nonmetropolitan areas, who are more worried than those in metropolitan areas.

3. Implications for Policy and Elections: The findings underscore the importance of healthcare costs as a pivotal issue for older voters, who constituted over half of the electorate in the 2020 U.S. elections. With the population aging and healthcare costs rising, experts like Lori Smetanka stress the necessity for policies that support effective retirement and long-term care planning, emphasizing that these issues should be central in the platforms of those running for office.

Prescription Costs and Inflation Drive 2025 Health Insurance Premium Hikes

By Giuliana Grossi - Health insurance premiums for 2025 are expected to rise slightly due to higher prescription drug costs and inflation, according to a new analysis from the American Academy of Actuaries. The analysis outlines the key factors influencing rates in the upcoming year. Read Full Article…

HVBA Article Summary

1. Evolving Cost Factors: The American Academy of Actuaries' issue brief identifies rising prescription drug costs and a return to normalcy in inflation as primary drivers of health insurance premium changes for 2025. Notably, high demand for GLP-1 medications for weight loss contributes significantly to the uptick in premium costs, alongside the effects of past inflation rates now settling into more historical patterns.

2. Technological and Legislative Influences: The brief highlights the impact of expensive medical advancements, like gene therapy, on future premiums. Although these treatments aren't typically covered in individual and small group markets, their increasing availability could prompt legislative changes requiring coverage, which would dramatically affect premiums. Furthermore, the No Surprises Act’s potential to influence premiums remains uncertain due to ongoing legal challenges.

3. Market Stability and Variability: Despite the upward pressures on premiums, the brief suggests a stable risk pool across the ACA markets, which minimizes drastic changes in premium costs on a national level. However, significant regional variability could arise as individual insurers and markets react to local economic conditions and healthcare landscapes, indicating that some areas might experience disparate premium changes compared to others.

Medicare reveals results of drug price negotiations

By Ned Pagliarulo - The U.S. government on Thursday said it stands to save taxpayers $6 billion on the prices it will pay for 10 widely used prescription drugs under its new authority to leverage Medicare’s market power to reduce the cost of brand-name medicines. Read Full Article…

HVBA Article Summary

1. Financial Impact and Price Reductions: The Biden administration's announcement regarding the direct negotiation of drug prices, set to commence in 2026, is a significant milestone under the Inflation Reduction Act. This initiative targets 10 high-cost drugs, including treatments for conditions such as heart failure and diabetes, with negotiated prices showing reductions ranging from 38% to 79%. This approach is expected to save Medicare enrollees approximately $1.5 billion in out-of-pocket expenses in its first year.

2. Pharmaceutical Industry Response and Legal Challenges: The pharmaceutical sector has expressed strong opposition to the new price negotiation framework, equating it to unconstitutional price setting due to substantial penalties for non-compliance. Despite these objections and several legal challenges, courts have so far permitted the process to continue. The industry is concerned about the long-term effects on innovation, especially the research and development of new drugs.

3. Future Projections and Policy Implications: This policy marks just the beginning of an expansive strategy, with Medicare planning to negotiate prices for a total of 60 drugs over the coming years. The implementation of this policy not only aims to reduce drug costs but also includes mechanisms like mandatory rebates for price hikes exceeding inflation, thereby exerting further downward pressure on prices. These efforts align with broader healthcare reforms aimed at curbing medical expenses and enhancing affordability for American consumers.

The Standard to Acquire Allstate’s Employer Voluntary Benefits Business for $2B

By Remy Samuels - StanCorp Financial Group Inc., also called The Standard, announced Tuesday it will acquire the Allstate Corp.’s employer voluntary benefit business for about $2 billion. The companies will enter into a product distribution partnership, and the transaction is expected to close in the first half of 2025, subject to regulatory approvals and other closing conditions, according to The Standard. Read Full Article…

HVBA Article Summary

1. Strategic Acquisition and Growth: The Standard acquired Securian Financial's recordkeeping business in December 2022, which brought about $17 billion in assets under administration to The Standard's existing $66.7 billion. This acquisition is part of The Standard’s strategic move to significantly accelerate its growth and enhance its competitive position in the U.S. employee benefits market. This step aligns with the company's goal to expand its workplace benefits offerings, integrating a broader range of voluntary and supplemental benefits that are in increasing demand by employers and employees.

2. Partnership with Allstate: The partnership between The Standard and Allstate underlines a strategic alignment in their workplace benefits provisions. Allstate’s Employer Voluntary Benefits business, serving over 3.5 million customers, will continue under The Standard’s administration, promising customers broader protection and higher value. This includes a five-year exclusive distribution arrangement where Allstate agents will offer an expanded array of group life and disability insurance products, enhancing the service options available to their customers.

3. Advisory and Legal Support: The transaction process is supported by high-profile financial and legal advisers to ensure a smooth and efficient acquisition. Citi is serving as the exclusive financial adviser, while Debevoise & Plimpton is handling the legal aspects for The Standard. For Allstate, financial advisory roles are filled by J.P. Morgan and Ardea Partners, with Willkie Farr & Gallagher LLP providing legal counsel. These partnerships underscore the complexity and significance of the transaction in the financial and legal realms.

Medical Stop Loss Report Shows Rise in Claim Frequency of Neoplasms

By Sponsored Content - QBE North America’s 2024 Accident & Health Market Report shows that neoplasms remain the most frequent source of stop loss reimbursements, whereas premature births now exhibit the highest severity. The global insurer’s annual report explores the current trends in healthcare spending and provides valuable insights for employers who offer self-funded health plans. Read Full Article…

HVBA Article Summary

1. Rising Claims and Predominant Conditions: The frequency of medical stop loss claims exceeding $200,000 per 10,000 covered individuals saw a significant rise of 39% from 2022, with neoplasms persisting as the most prevalent condition. They account for 41% of all stop loss claim reimbursements in 2023, underscoring the ongoing challenge of managing high-cost claims in healthcare.

2. Impact of Deductible Size on Cancer Claims: The report highlights a variance in cancer claims based on deductible sizes. For instance, breast cancer claims make up about 17% of cancer-related claims with a $100K deductible but decrease to 3% for a $1M deductible. Conversely, lymphoid leukemia claims increase dramatically with higher deductibles, from 3% at a $100K deductible to 38% at a $1M deductible. This indicates a shifting burden of costs as deductibles increase.

3. Legislative Efforts Towards Cost Transparency: Legislative action is focusing on price transparency and cost control, particularly concerning Pharmacy Benefit Managers (PBMs). The Pharmacy Benefit Manager Reform Act proposed by the Senate aims to eliminate spread pricing and requires PBMs to disclose detailed pricing practices. This could lead to increased transparency and potentially lower costs, as only 37% of the drug price goes to the manufacturer, with the rest attributed to third-party mark-ups.

Delta Dental finds increase in dental coverage enrollment

By Allison Bell - Trends that pushed up major medical insurance enrollment may be helping to increase the percentage of Americans with dental insurance this year. About 65% of U.S. adults now have dental insurance, up from 59% in 2023, and up from 56% in 2020, according to results from an online survey conducted by Delta Dental. Read Full Article…

HVBA Article Summary

1. Prevalence and Impact of Dental Coverage: Delta Dental, encompassing 39 organizations, covers 85 million people across the U.S., representing about 25% of the population through 159,000 employer groups. The substantial coverage underscores the critical role of dental insurance in facilitating access to dental care. In 2023, 83% of insured participants visited a dentist, compared to only 58% of those without insurance, highlighting the significant disparity in dental care access based on insurance status.

2. Awareness and Health Correlations: Although about half of the survey participants recognized the link between oral health and heart disease, less than 30% were aware of the associations between oral health issues and dementia. This gap in knowledge suggests a need for enhanced educational efforts to inform the public about the broader health implications of oral hygiene and health.

3. Cost as a Barrier to Dental Care: The survey reveals a growing concern about out-of-pocket costs, with 22% citing it as an obstacle to obtaining emergency dental care. This trend is an increase from previous years, with historical data showing a fluctuation in the percentage of participants who avoided dental care due to cost. The issue of affordability remains a pivotal factor influencing access to dental services, reflecting the need for policy interventions or insurance solutions to reduce financial barriers to essential health services.

The GLP-1 questions facing health systems

By Molly Gamble - There's no shortage of headlines and hypotheticals about the blockbuster drug class of GLP-1s. Stephen Klasko, MD, argues we're asking the wrong questions about GLP-1s. Read Full Article…

HVBA Article Summary

1. Unpreparedness of the U.S. Healthcare System: Dr. Klasko highlighted the U.S. healthcare system's lack of readiness for the rise of GLP-1 medications like Ozempic and Wegovy. Despite their FDA approval years before, the system was caught off-guard by their sudden popularity and high costs. This situation underscored the need for proactive planning in healthcare to manage both financial and healthcare equity challenges effectively.

2. Coverage Decisions for Health System Employees: Health systems face complex decisions regarding the coverage of GLP-1 medications for their employees. Balancing the immediate financial costs with potential long-term benefits is challenging, especially with the risk of high employee turnover. Dr. Klasko expressed concerns about sustainability and the financial implications if employees leave for companies that do not cover these medications.

3. Negotiating Insurance Coverage for GLP-1s: Dr. Klasko advised health system leaders on the importance of leveraging alternative payment models and strategic negotiations with insurers to prioritize GLP-1 coverage. Focusing on areas where health systems act as both payer and provider could align incentives more effectively, improving outcomes and cost management for these high-demand medications.

Wells Fargo and J&J lawsuits: Key legal insights for fiduciaries and benefits advisors

By Troy Sisum - Here we go again. For the second time in less than six months, a large corporation's health plan has been targeted in a lawsuit by employees alleging that the plan failed to do what is best for members. Read Full Article…

HVBA Article Summary

1. Understanding and Application of Key Legislation: The Employee Retirement Income Security Act of 1974 (ERISA) and the Consolidated Appropriations Act of 2021 (CAA) play crucial roles in defining the responsibilities and transparency required from fiduciaries managing health plans. Employers and their advisors need to be vigilant and proactive in using these laws to ensure that their health plans meet legal standards and protect member interests, especially given the recent litigations against major companies like Wells Fargo and Johnson & Johnson.

2. Proactive Health Plan Management: It’s vital for employers to choose their health plan vendors carefully and monitor their performance regularly. This involves understanding the services provided, the fees involved, and the legal responsibilities of each party. Employers should also consider auditing their plans and exploring cost-containment strategies by consulting with alternative PBMs and other service providers.

3. Legal Preparedness and External Assistance: Employers should maintain rigorous documentation and follow their established health plan processes to defend against potential lawsuits. Hiring outside counsel can provide additional support to ensure that health plan designs and processes comply with federal regulations, potentially saving significant costs in legal fees and settlements while also safeguarding the company’s reputation.

Survey: Over 70 Percent of FQHCs Face Critical Staff Shortages

By David Raths - In 2024, more than 70 percent of community health centers (CHCs) reported primary care physician, nurse, or mental health professional shortages, according to a new Commonwealth Fund survey. Read Full Article…

HVBA Article Summary

1. Vital Role and Reach of CHCs: Released during the National Health Center Week, the survey underscores the critical role Community Health Centers (CHCs) play in the healthcare system, providing accessible, comprehensive, and coordinated care to over 30 million patients annually. These patients include 20 million low-income individuals, 17 million people of color, 15 million covered by Medicaid or the Children’s Health Insurance Program, and nearly 16 million uninsured. CHCs, also known as federally qualified health centers (FQHCs), operate in over 15,000 service areas through 1,368 centers, sustained by federal funding, Medicaid reimbursement, and other revenues.

2. Enhancements and Challenges in Service Delivery: The survey highlights significant improvements in service offerings since 2018, including a dramatic increase in telehealth services (from 24% to 96%), enhanced availability of substance use disorder treatment, and more comprehensive screening for social and economic needs. Despite these advancements, CHCs continue to face significant challenges, particularly in securing timely specialty care appointments for patients, notably those covered by Medicaid or uninsured.

3. Policy Recommendations for Sustained Support: The Commonwealth Fund recommends critical policy actions to ensure continued support for CHCs. These include the reauthorization and expansion of the Community Health Center Fund, addressing workforce shortages to enhance recruitment, retention, and training in underserved areas, and ensuring adequate resources for telehealth by aligning reimbursements with those for in-person care, advocating for the extension of federal flexibilities beyond their 2024 expiration.