DOJ to reward health care fraud whistleblowers

By Allison Bell - Benefits managers, plan participants and even benefits advisors may have a new way to make money: Spot and report major cases of health care fraud against the employers' health plans, the plan participants or the employers' health insurers. Read Full Article…

HVBA Article Summary

1. Focus on Non-Public Fraud: The new pilot program encourages whistleblowing on fraud involving private or non-public health care benefit programs, targeting fraud against non-governmental entities such as patients and investors. This marks a shift from traditional whistleblower programs that primarily focus on public funds like Medicare fraud.

2. Reward Structure: Whistleblowers stand to gain financially if their information leads to the forfeiture of assets by the prosecuted entity. They could receive up to 30% of the first $100 million in forfeited net proceeds and 5% of amounts between $100 million and $500 million, with a cap at $50 million.

3. Challenges and Eligibility: Despite the lucrative potential of the program, challenges persist. Whistleblowers must report substantial cases of fraud that result in civil or criminal asset forfeiture to qualify for rewards. Additionally, the program targets both small and large healthcare providers, focusing on egregious cases of fraud to enhance deterrence and punishment rather than the financial capacity of the fraudulent entity.

Feds Killed Plan To Curb Medicare Advantage Overbilling After Industry Opposition

By Fred Schulte - A decade ago, federal officials drafted a plan to discourage Medicare Advantage health insurers from overcharging the government by billions of dollars — only to abruptly back off amid an “uproar” from the industry, newly released court filings show. Read Full Article…

HVBA Article Summary

1. Regulatory Reversal and Industry Influence: In January 2014, CMS proposed a regulation requiring health plans to scrutinize patient records not just for additional diagnoses that could lead to increased payments but also to identify and refund overpayments. However, by May 2014, CMS retracted the proposal without public explanation, citing "stakeholder concern and pushback." This reversal highlights the significant influence the health industry wields over regulatory processes, often prioritizing industry interests over taxpayer savings.

2. Legal and Ethical Implications: The dropped regulation has become central to a Justice Department civil fraud case against UnitedHealth Group, alleging the insurer exploited CMS's leniency to improperly bill Medicare over $2 billion. The case illustrates the complexities of enforcing healthcare fraud prevention, especially when potential regulatory measures are withdrawn under industry pressure.

3. Broader Systemic Challenges: The situation underscores broader systemic issues within the Medicare Advantage program, which has seen explosive growth and numerous allegations of inflated patient diagnoses to increase Medicare payments. Despite the clear financial implications for the government, CMS's tentative approach to regulatory enforcement suggests a pattern of avoiding conflict with powerful healthcare plans, potentially at the expense of effective oversight.

J&J’s Change to 340B Discounts is “Inconsistent” with Statute, HRSA Says

By Marissa Plescia - In a letter last week, Johnson & Johnson informed certain hospitals of a major change it plans to make in the way it gives out discounts on two drugs. The company has found itself in opposition to hospital groups, and the federal government is planning to take action. Read Full Article…

HVBA Article Summary

1. Shift to Rebate System: Starting from October 15, Johnson & Johnson will modify its pricing policy for the drugs Stelara and Xarelto under the 340B Drug Pricing Program, transitioning from upfront discounts to a rebate system. Disproportionate share hospitals (DSH) will now have to pay the full price initially and then apply for a rebate to get the discounted rate. This change has raised concerns among hospital organizations, which argue that the new system could impose significant financial and administrative burdens on facilities that serve vulnerable communities.

2. HRSA’s Response and Legal Concerns: The Health Resources and Services Administration (HRSA) has indicated that Johnson & Johnson's new rebate model may not comply with the statutory requirements of the 340B program, lacking necessary approval from the Secretary. HRSA has warned it will take "appropriate actions as warranted" against deviations from the program's guidelines. This disagreement highlights ongoing tensions between pharmaceutical companies and regulatory agencies regarding the scope and implementation of the 340B program.

3. Industry and Organizational Backlash: The shift by Johnson & Johnson has prompted backlash from various healthcare organizations and trade groups, including 340B Health and the American Hospital Association (AHA). These groups assert that the rebate model could lead to delays and uncertainties in receiving drug discounts, thereby straining the financial operations of hospitals that rely on 340B savings to serve low-income and uninsured patients. They advocate for continued adherence to the original upfront discount model to ensure that safety-net providers can maintain accessible and affordable healthcare services.

How Narrow or Broad Are ACA Marketplace Physician Networks?

By Matthew Rae, Karen Pollitz, Kaye Pestaina, Michelle Long, Justin Lo, and Cynthia Cox - One way insurers seek to control costs is to limit the size of the physician networks serving their plans. Providers agree to lower fees and other terms with insurers in order to be included in one or more of the networks they offer. Insurers then either limit coverage to services provided by network providers or encourage enrollees to use network providers through lower cost sharing. Read Full Article…

HVBA Article Summary

1. Impact on Enrollees and Care Delivery: Narrowing provider networks reduces health plan costs but limits patient choice, potentially increasing wait times and complicating continuity of care when switching plans. Enrollees may face significant out-of-pocket expenses or denials of coverage when forced to use out-of-network providers. These dynamics underscore the critical impact of network size and composition on both access to healthcare and financial protection for enrollees.

2. Variability in Network Breadth across Marketplaces: There is significant variation in the breadth of provider networks within ACA Marketplaces, influenced by insurers’ strategies to compete on costs. Data from 2021 shows an average of 40% physician accessibility through plan networks, with stark disparities between urban and rural areas. The flexibility insurers have in network design, despite CMS standards, results in different experiences for enrollees based on geographic location and the specific plan chosen.

3. Financial Implications and Consumer Choices: Broader networks generally correlate with higher premiums. For example, Silver plans with higher physician participation rates are more expensive. Enrollees often face a difficult trade-off between cost and the breadth of accessible healthcare providers. This scenario is compounded by limited visibility and understanding of network breadth when choosing plans, highlighting a gap in consumer information and the need for more transparent and accessible data on provider networks.

Cigna to remove AbbVie's Humira from some drug reimbursement lists next year

By Patrick Wingrove - Cigna (CI.N), said on Monday it will remove AbbVie’s (ABBV.N), blockbuster rheumatoid arthritis drug Humira from some of its lists of preferred drugs for reimbursement in 2025, and recommend less pricey biosimilar versions of the medicine instead. Read Full Article…

HVBA Article Summary

1. Coverage of Humira Biosimilars: Cigna, through its pharmacy benefits unit Express Scripts, announced the inclusion of several biosimilars to Humira on some of its managed lists, expanding treatment options for patients. These biosimilars include Boehringer Ingelheim's Cyltezo, Teva's Simlandi, Alvotech's version, and an unbranded version of Hyrimoz from Sandoz. This move follows CVS Health’s Caremark, another major U.S. pharmacy benefits manager, which earlier ceased recommending coverage for Humira in favor of its biosimilars.

2. Market Dynamics and Pharmacy Benefit Managers' (PBMs) Role: Express Scripts and CVS Health's decisions to endorse biosimilars over Humira reflect a broader industry trend where PBMs, often scrutinized for their role in high drug pricing, assert their influence on market dynamics by negotiating drug coverage. Despite the introduction of 10 Humira biosimilars since January 2023, AbbVie has maintained a significant market share, attributed to strategic placements on insurance drug lists managed by these PBMs.

3. Future Implications for Humira: The shift towards biosimilar alternatives poses challenges for AbbVie’s flagship product, Humira, which generated peak sales of $21.2 billion in 2022. Although AbbVie predicts a decline in market share next year, recent actions by major PBMs suggest an accelerating transition to biosimilars, potentially reshaping competitive strategies in the biopharmaceutical industry.

Study finds AI's health advice still faces trust issues

By Kristen Beckman - Although a growing number of people are interacting with artificial intelligence, the majority of adults aren't sure they can tell the difference between true and false information from AI tools. Read Full Article…

HVBA Article Summary

1. Usage and Confidence Levels: According to the KFF Health Misinformation Tracking Poll, one in six adults utilize AI chatbots monthly for health-related inquiries, with this number rising to 25% among individuals under 30. However, there is a notable skepticism about the accuracy of the health information provided by these platforms, with 56% of users expressing doubts about the reliability of the data they receive.

2. Demographic Differences in Trust: Younger adults exhibit a higher likelihood of using AI platforms and also show greater confidence in discerning accurate from inaccurate information compared to their older counterparts. About 70% of adults over 65 express a lack of confidence in identifying truthful information on AI chatbots. This skepticism spans across demographic lines with only about one-third of adults feeling confident in the health advice provided by AI, highlighting varying levels of trust among different age and racial groups.

3. Comparative Trust in AI for Various Information Types: The poll reveals that while over half of the adults trust AI chatbots to deliver reliable information on practical tasks (54%) and technology (48%), trust significantly drops when it comes to health information, with only 29% expressing confidence. Additionally, the perception of AI’s impact on health information seekers is mixed, with an equal proportion (about 20%) believing AI is either harmful or helpful, and the majority remaining uncertain about its overall effect.

Ozempic on Wall Street's list for 2027 Medicare drug negotiations

By Michael Erman - Now that the U.S. government has negotiated prices for some Medicare program drugs effective in 2026, Wall Street analysts are betting on a 2027 list that will include Novo Nordisk's blockbuster (NOVOb.CO), Ozempic for diabetes and have a limited impact on Big Pharma. Read Full Article…

HVBA Article Summary

1. Expansion of Price Negotiations Under IRA: The Biden administration’s Inflation Reduction Act (IRA) mandates significant price reductions, targeting 10 popular prescription drugs used by Medicare with cuts ranging from 38% to 79% in 2026. This initiative will expand by 2027 and 2028, as regulators are set to negotiate prices for additional drugs, including those by Pfizer, GSK, Teva, and AbbVie, which have been identified based on their financial impact on Medicare.

2. Corporate Responses and Financial Forecasts: Pharmaceutical companies such as Pfizer, Teva, and AbbVie are already strategizing around the IRA's implications. Despite potential price cuts, companies forecast manageable impacts or even growth in revenues. For example, Teva projects a 25% revenue increase for its drug Austedo by 2027, and Pfizer expects a muted impact on its cancer drugs Ibrance and Xtandi, which are approaching patent expiration.

3. Future Implications and Analyst Insights: Analysts predict that while initial price negotiation impacts might be significant on paper, the actual financial effect on companies could be less severe due to pre-existing discounts and market pricing adjustments. The Congressional Budget Office anticipates substantial government savings from these negotiations, predicting a rise from $6 billion in savings this year to $9.4 billion next year, highlighting the ongoing policy impact on drug pricing and pharmaceutical industry economics.

First Over-the-Counter Continuous Glucose Monitor Launches

By Miriam E. Tucker - The first — but not the last — over-the-counter continuous glucose monitor (CGM) is now available for people older than 18 years who don't use insulin and who aren't at a risk for hypoglycemia. Dexcom's Stelo is designed specifically for people with type 2 diabetes who don't use insulin or who have prediabetes but is now available over the counter for anyone for $99 a month or $89 per month with a subscription. Read Full Article…

HVBA Article Summary

1. Insurance Coverage and Financial Options: As of now, Dexcom's new continuous glucose monitor (CGM), Stelo, is not covered by insurance nor does it have designated financial assistance programs. However, individuals interested in acquiring the device can utilize healthcare spending accounts to manage the cost, providing a flexible payment option despite the lack of direct insurance support.

2. Device Features and Functionality: The Stelo CGM offers several advancements over traditional models. Like its predecessors, it is waterproof, worn on the back of the upper arm, and capable of sending real-time glucose data to a smartphone without the need for finger sticks. Each sensor has a 15-day lifespan. Notably, unlike previous models, Stelo does not have low blood sugar alarms, which marks a significant change in the device's alert system capabilities.

3. Clinical Impact and Future Prospects: Dr. Thomas Grace of Dexcom highlighted the proven benefits of CGM systems like improved A1c levels, time in glucose range, and overall well-being for those living with diabetes. With Stelo, Dexcom aims to replicate these outcomes. Furthermore, the upcoming launch of competing CGMs by Abbott Diabetes Care signifies a growing market and varying consumer needs in glucose monitoring, potentially influencing future insurance coverage and healthcare practices concerning CGM technology.

Employer healthcare costs set to spike in 2025, driven by pharmacy, cancer

By Caroline Catherman - A new survey suggests employers will spend nearly 8% more on healthcare costs in 2025—the highest amount in over a decade. And no, it’s not just inflation doing the heavy lifting, according to the 2025 Employer Health Care Strategy Survey that nonprofit Business Group on Health released August 20 with polling results from 125 employers across various industries. Read Full Article…

HVBA Article Summary

1. Escalating Drug Costs: The group highlighted in their press release that drug spending is significantly impacting employer budgets, with pharmacy costs rising to 27% of total healthcare spending in 2023, up from 21% in 2021. This surge is partly fueled by the increased demand for GLP-1 medications, used in treating obesity and diabetes, which has seen nearly 80% of employers reporting a rise in interest.

2. Strategic Adjustments: In response to the rising costs, employers are planning strategic adjustments to manage their healthcare spending more effectively. This includes tightening relationships with vendors to ensure value for money, eliminating underperforming partners, and enhancing the focus on preventative care. Furthermore, there is a push for more transparency in the cost and quality of services, especially concerning pharmacy benefit managers, with 73% of employers demanding clearer pricing and contracting details.

3. Prioritization of Mental Health Services: Despite the need to curtail expenses, employers are committed to maintaining and even prioritizing mental health services. According to the latest data, 79% of employers intend to focus on these services in 2025, continuing to provide no- or low-cost virtual counseling options to support the well-being of their workforce. This indicates a recognition of the importance of mental health alongside the necessity of managing physical health costs.