Members leaving Medicare Advantage have higher expenses, KFF finds: 5 things to note

By Rylee Wilson - Medicare spends more on beneficiaries who switch from Medicare Advantage to traditional Medicare compared to those who remained enrolled in traditional Medicare, a report from KFF found. Read Full Article… 

HVBA Article Summary

1. Higher Costs After Switching: Medicare incurred an average of $2,585 more per beneficiary for individuals who switched from Medicare Advantage (MA) to traditional Medicare in 2022 compared to those continuously enrolled in traditional Medicare. The spending differences were especially pronounced among older beneficiaries and those with chronic conditions.

2. Disparities Among Demographics: Spending disparities were notable across demographic groups. For example, Medicare spent 55% more on Black beneficiaries and 54% more on Hispanic beneficiaries who switched from MA to traditional Medicare than on those who remained in traditional Medicare.

3. Chronic Conditions and End-of-Life Care: Enrollees with chronic conditions, such as diabetes, saw significantly higher spending increases upon switching, with costs 34% higher for those leaving MA. Additionally, skilled nursing facility care accounted for about one-third of the spending gap, with higher costs observed among beneficiaries in the last year of their lives.

Compounding and GLP-1s: What To Expect When GLP-1 Drugs Are Removed From FDA’s Drug Shortage List

By Avia M. Dunn, Maya P. Florence, Rachel Turow, and Nicole L. Grimm - Glucagon-like peptide-1 receptor agonists, also known as GLP-1 drugs, are a class of medications that mimic the action of the glucagon-like peptide-1 hormone, which is involved in the regulation of blood sugar levels. These drugs can also slow gastric emptying, which contributes to weight loss. Read Full Article…

HVBA Article Summary

1. Impact of GLP-1 Drug Shortages: Since 2022, extraordinary demand for GLP-1 drugs, including those for weight loss, has led to FDA shortages and widespread compounding of these drugs. However, when the shortages end, compounded versions will become unapproved, raising significant regulatory and patient access challenges.

2. Regulatory Framework and Compounding Exceptions: The FDA’s regulatory framework permits compounding only under specific conditions, primarily to address drug shortages or patient-specific needs. The GLP-1 shortage temporarily allowed compounding exceptions, but these will cease once shortages are resolved, leaving compounders to navigate strict legal and safety requirements.

3. Future Implications and Challenges: The GLP-1 shortage highlights unique market dynamics, including high demand for effective weight loss treatments and patient reliance on compounded drugs. While FDA has tolerated compounded GLP-1s during the shortage, it is unlikely to signal a broader shift in compounding policy due to inherent safety and regulatory concerns.

Senate bill could ban spread pricing, and cost PBMs $7B per year: Budget analysts

By Allison Bell - Passing and implementing a Senate pharmacy benefit manager bill as written could cost the PBMs billions of dollars in revenue per year, according to a new analysis from the Congressional Budget Office.  Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Transparency Requirements: The Pharmacy Benefit Manager Reform Act mandates that PBMs provide health plans with an annual statement detailing prescription drug coverage costs, including rebates and discounts, to improve cost transparency for health plan sponsors.

2. Ban on Spread Pricing: The bill prohibits spread pricing, a practice where PBMs profit by charging health plans more for a drug than they pay pharmacies, a change projected by the CBO to reduce net retail drug costs for employment-based health plans by approximately 0.5%.

3. Economic Impact: According to CBO analysts, the combined reforms—banning spread pricing and mandating the transfer of discounts to health plans—could save more than $7 billion annually over the first five years, reducing PBMs' revenue by about 1.4% of their $500 billion annual revenue.

Millions will lose health coverage if ACA subsidies expire: CBO

By Joseph Choi - A new report released by the Congressional Budget Office (CBO) found that if the Affordable Care Act’s (ACA) extended subsidies are allowed to expire at the end of 2025, millions of people will become uninsured and premiums will rise. Read Full Article…

HVBA Article Summary

1. Impact on Health Insurance Coverage: The Congressional Budget Office (CBO) projects a significant rise in the number of uninsured individuals if the premium tax subsidies are not extended permanently. Without the subsidies, an additional 2.2 million people could become uninsured in 2026, with this number increasing to 3.7 million in 2027 and averaging 3.8 million annually between 2026 and 2034.

2. Premium Increases and Financial Implications: The expiration of these subsidies is expected to increase gross benchmark premiums for marketplace plans by 4.3% in 2026 and by an average of 7.9% annually from 2026 to 2034. The cost of making the subsidies permanent has been estimated by the CBO at $335 billion over a decade.

3. Political Challenges and Legislative Efforts: With a Republican trifecta anticipated in the next government, the likelihood of extending the subsidies beyond 2025 appears slim. Despite this, Democrats are seeking to negotiate a temporary one-year extension, reflecting ongoing efforts to prevent a sharp increase in uninsured rates and premium costs.

US seniors face greater affordability challenges, study finds

By Paige Minemyer - Older Americans are more likely to struggle with affordability of healthcare compared to those living in other wealthy nations, despite almost all being enrolled in Medicare coverage, a new study shows. Read Full Article…

HVBA Article Summary

1. High Out-of-Pocket Costs in the U.S.: The survey revealed that nearly 1 in 4 seniors in the U.S. faced out-of-pocket healthcare expenses exceeding $2,000 in the past year, compared to less than 5% in France or the Netherlands. Only seniors in Switzerland reported higher out-of-pocket spending than Americans.

2. Cost-Related Barriers to Care: American seniors were the most likely to delay or forgo care due to cost, with 1 in 3 of those facing such barriers reporting fair or poor health. Across all 10 countries surveyed, only 10% of seniors skipped or delayed care for financial reasons.

3. Policy Insights and Potential Improvements: The study highlighted disparities in dental care affordability, with 1 in 5 seniors in the U.S., Canada, and Australia skipping care due to cost. The findings suggest U.S. policymakers could adopt strategies from other nations, such as capping out-of-pocket expenses or fully covering hospital and physician services, to strengthen Medicare and reduce financial barriers for older adults.

Study: Marketplace plans secure lower provider rates

By Alan Goforth - Providers are paid less in Marketplace health plans than under employer-sponsored small-group plans, according to a new study published in HealthAffairs. Researchers found that Marketplace professional prices were 6.9% lower, inpatient prices were 13.3% lower and outpatient prices were 26.3% lower. Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Lower Prices in Non-Group Plans: The study highlights that non-group plan prices, particularly in the Marketplace, are significantly lower than those of employer-sponsored small-group plans, exceeding the differences noted in prior research. This finding is crucial for assessing the role of federal subsidies in making non-group coverage affordable and for shaping policies such as a public option with price caps tied to Medicare rates.

2. Key Drivers of Price Differences: Marketplace plans tend to have narrower provider networks, often managed by Medicaid-focused insurers, which helps negotiate lower prices. Additionally, non-group enrollees are more sensitive to premium costs than employer-sponsored insurance members, pushing insurers to prioritize cost-efficiency and negotiate competitive provider rates.

3. Policy and Affordability Implications: The study emphasizes the importance of understanding price dynamics between non-group and employer-based insurance in addressing affordability challenges. The findings suggest that Marketplace enrollees, driven by individual purchasing behaviors and lower-income demographics, benefit from pricing structures that incentivize lower premiums. However, even with these cost advantages, provider prices in Marketplace plans remain substantially higher than Medicare rates, indicating room for further optimization.

Cancer treatments jump among young adults

By Tina Reed - Cancer treatment rates jumped among adults younger than age 50 between 2020 and 2023, according to a FAIR Health analysis shared first with Axios. Read Full Article…

HVBA Article Summary

1. Rising Cancer Rates in Younger Populations: Despite advancements in cancer treatment and prevention, certain cancers—such as colorectal cancer—are increasingly being diagnosed in younger adults. Between 2020 and 2023, cancer treatment rates for patients aged 18-49 saw a significant rise, with an 11% increase in digestive system cancers and 18% in colorectal cancer.

2. Geographic and Cost Disparities: In 2023, the highest treatment rates for younger cancer patients were reported in New York, Arizona, Washington, D.C., Florida, and Pennsylvania, while the lowest were in Wyoming, West Virginia, Alabama, Rhode Island, and Alaska. Younger cancer patients also faced disproportionately higher healthcare costs compared to their peers without cancer, partly due to the high costs of common cancers like breast, lung, and colorectal cancers.

3. Long-Term Trends and HPV-Related Cancers: Over the period from 2016 to 2023, overall cancer treatment rates among patients aged 18-49 decreased, driven largely by declines in HPV-related cancers. However, certain types, such as colorectal and digestive system cancers, showed marked increases, highlighting evolving patterns in cancer prevalence and treatment among younger populations.