FTC: Big Insurance’s PBMs “Profit at the Expense of Patients by Inflating Drug Costs and Squeezing Main Street Pharmacies"

By Wendell Potter - Regular readers of HEALTH CARE un-covered know that I write frequently about the huge amounts of money the health insurance industry’s pharmacy benefit managers (PBMs) extract from the prescription drug supply chain. I also submitted a comment letter to the Federal Trade Commission two and a half years ago urging it to launch an investigation into PBM business practices that have contributed to the closure of hundreds of independent pharmacies across the country and to millions of Americans walking away from the pharmacy counter without their medications. Read Full Article…

HVBA Article Summary

1. FTC's Damning Interim Report on PBMs: The FTC released an interim report confirming that six companies now control 95% of the pharmacy benefit market. These PBMs, owned by major insurance companies, are accused of inflating drug costs and harming independent pharmacies, highlighting the need for regulatory intervention.

2. Congressional Response and Call for Action: Representative Earl L. "Buddy" Carter (R-Ga.) praised the FTC's bipartisan investigation into PBMs, citing their deceptive practices that reduce patient access to affordable healthcare. Carter emphasized the urgency of completing the investigation and taking enforcement actions against anti-competitive PBM practices to prevent the closure of independent pharmacies.

3. Legislative Efforts to Reform PBMs: In response to the FTC's findings, several members of Congress, including Carter, have introduced bipartisan bills aimed at reining in PBMs. Although the House has passed PBM reform legislation, the Senate has yet to do so. However, growing support in both chambers, bolstered by the FTC's report, increases the likelihood of enacting reform by the end of the year.

Healthcare industry rails against CISA's 'redundant' and 'burdensome' cyber incident reporting proposal

By Dave Muoio - Healthcare industry groups are urging the federal government to streamline and loosen a recent proposed rule outlining cybersecurity incident reporting requirements for entities considered to be critical infrastructure. Read Full Article…

HVBA Article Summary

1. Enhanced Reporting Requirements and Their Impact: The proposed rule by the Cybersecurity and Infrastructure Security Agency (CISA) aims to implement the Cyber Incident Reporting for Critical Infrastructure Act of 2022 (CIRCIA), introducing enhanced and expedited reporting requirements to improve the government's ability to understand and respond to cyber threats. The proposal mandates that hospitals with 100 or more beds, critical access hospitals, essential medicine manufacturers, moderate-to-high-risk medical device makers, and a broad range of IT entities report cyber incidents within 72 hours. However, industry groups, such as the American Hospital Association (AHA), have expressed concerns about the strain these requirements would place on already overwhelmed organizations, particularly during active cyberattacks.

2. Data Preservation and Resource Burdens: In addition to rapid reporting, the proposed rule requires entities to preserve extensive data logs, forensics, and communications for two years following a cyber incident. This stipulation has raised significant concerns among healthcare organizations due to the substantial data storage capacity and additional staffing needed to comply. The AHA highlighted the financial and operational burdens this would impose, emphasizing the need for CISA to simplify or eliminate such requirements to avoid further straining healthcare providers.

3. Inclusion Criteria and Harmonization with Existing Regulations: The proposed rule has faced criticism for its vague inclusion criteria for certain healthcare-related entities, such as health insurers, lab operators, and health IT providers. Industry groups, including the Medical Group Management Association (MGMA) and the American Medical Association (AMA), have urged CISA to provide clearer definitions and harmonize its requirements with existing Health and Human Services (HHS) regulations to avoid redundancy and confusion. They argue that clearer criteria and streamlined reporting processes are essential to ensure compliance without overwhelming smaller healthcare entities or leaving critical third-party vendors unaccounted for.

The Latest in Licensure: Out-of-State Telehealth Provider Policies

By CCHP - Provider licensure exceptions particular to the use of telehealth across state lines continues to be a popular issue area for those reaching out to CCHP for technical assistance. Questions are received from providers and patients alike, and often providers ask for a list of specific states that currently allow out-of-state providers to deliver care via telehealth to in-state patients for their specific profession. In this week’s write up, we would like to drill down on this area of telehealth policy in the hopes of painting a clearer picture. Read Full Article…

HVBA Article Summary

1. State Licensure Requirements and Exceptions: Telehealth services are considered to be provided at the location of the patient, which generally requires healthcare providers to hold a license or some form of in-state approval in the patient’s state. While there are limited licensure exceptions, these vary significantly between states and professions, making it essential for providers to carefully review and ensure compliance with each state’s specific regulations.

2. Telehealth Registration Processes: In addition to limited licensure exceptions, 21 states have established telehealth registration processes. These processes, which may go by various names such as telemedicine license, registration, certification, permit, or waiver, aim to provide oversight and jurisdiction over out-of-state providers, often including restrictions like prohibiting in-person care or the establishment of an office in the state.

3. Interstate Licensure Compacts: Interstate compacts are another key mechanism allowing out-of-state telehealth providers to practice across state lines with streamlined licensure processes. Only five jurisdictions are not members of any compact, highlighting the widespread adoption of these agreements to facilitate telehealth services. These compacts typically require a single approval process, enabling providers to operate in multiple member states while adhering to a standardized set of regulations.

UnitedHealth Group, officials sued over Justice Department probe

By Andrew Cass - UnitedHealth Group and several of the company's leaders are facing a shareholder derivative lawsuit alleging they failed to disclose that the Justice Department opened an antitrust investigation into the company. Read Full Article…

HVBA Article Summary

1. Public Revelation and Stock Impact: The investigation into UnitedHealth's segment relationships, including Optum, became public on February 27, leading to a significant stock price drop. Following the news reports by The Wall Street Journal and others, UnitedHealth's stock fell from $525.32 per share on February 26 to $513.42 per share on February 27, further declining to $498.28 per share the next day.

2. Lawsuit Allegations and Defendants: The lawsuit, filed by shareholder Portia McCollum in Minnesota federal court, accuses UnitedHealth's individual defendants, including CEO Andrew Witty, chairman Stephen Hemsley, and UnitedHealthcare CEO Brian Thompson, of breaching their fiduciary duties. The allegations include failing to establish proper firewalls between Optum and UnitedHealthcare and misleading the investing public with false statements and omissions.

3. Claims of Insider Trading and Financial Mismanagement: The lawsuit alleges that UnitedHealth officials were aware of the investigation since October and engaged in insider trading, with Hemsley and Thompson accused of selling substantial amounts of UnitedHealth stock while possessing non-public information. The suit seeks corporate governance reforms and internal procedure improvements to prevent future misconduct, claiming that the company's financial reporting and governance failures have resulted in significant financial losses and unjust enrichment of the defendants.

Who Will Pay for Prescription Drugs in 2032: Four Takeaways from the New Government Forecasts

By Drug Channels - The econowonks at the Centers for Medicare & Medicaid Services (CMS) recently released the latest projections for U.S. spending on healthcare. These data provide the latest official look at how the Inflation Reduction Act (IRA) will affect U.S. healthcare spending. Read Full Article…

HVBA Article Summary

1. Impact of the Inflation Reduction Act and Demographic Shifts: The Inflation Reduction Act (IRA) and demographic changes, particularly the aging Baby Boomer generation, are expected to significantly influence future spending on prescription drugs by government programs like Medicare. Despite these shifts, outpatient prescription drugs dispensed by retail and mail pharmacies will continue to represent a modest portion of overall U.S. healthcare expenditures, projected to account for 9.5% by 2030, compared to 9.1% in 2022.

2. Government and Medicaid Spending Trends: While Medicare's share of prescription drug spending is projected to increase from 32% in 2022 to 36% by 2032, Medicaid's share, which saw significant growth during the COVID-19 pandemic, is expected to decrease. Medicaid enrollment, peaking at 91.2 million people in 2023, is projected to decline, affecting its share of prescription drug spending, which will fall from 11.1% in 2022 to 10.2% in 2023 and then stabilize with a modest growth rate through 2032.

3. Role of Private Insurance and Consumer Spending: Private insurance's share of prescription drug spending, driven by individually purchased marketplace plans, will see slight growth over the next decade. Consumers' out-of-pocket expenses for prescription drugs, though declining as a share of total expenditures, will remain disproportionately high compared to other healthcare services. By 2032, consumers' out-of-pocket spending for outpatient prescriptions is projected to be $79.9 billion, significantly higher than their projected spending on hospital care.

Inflation could take a bite out of benefits spending

By Kristen Beckman - As costs rise, employees are considering tightening their benefits budgets. Consumers are willing to spend a median $120 monthly on benefits, not including retirement savings, this year. That is down $50 from the previous 2 years, according to new data from LIMRA's 2024 BEAT Study: Benefits and Employee Attitude Tracker. Read Full Article…

HVBA Article Summary

1. Decline in Willingness to Pay for Benefits: Employees' willingness to pay for workplace benefits has decreased in recent years, driven by inflation and tighter budget constraints. This may result in employees reducing or dropping certain benefits and possibly lowering retirement contributions to save money.

2. Income and Enrollment Impact on Benefit Spending: Higher-income employees, married individuals with dependent children, younger workers, and those already enrolled in benefits are willing to spend a median of $150 per month on benefits. In contrast, employees not enrolled in workplace benefits plans are only willing to spend $100 per month.

3. Need for Improved Benefits Communication and Education: The report highlights an opportunity for employers to enhance education around benefits offerings to boost enrollment and usage. While employees understand core benefits like dental, medical, and retirement savings, there is less understanding of disability insurance and supplemental health plans. Additionally, 73% of workers express a desire for more frequent benefits communication throughout the year, rather than only during open enrollment.

This construction company is on a mission to destigmatize mental health

By Lee Hafner - Mental wellness support has become critical in all workplaces, but in high-stress industries, such as construction, employees are less likely to acknowledge they need help. Atlanta-based construction supply company White Cap is working to reverse this trend. Read Full Article…

HVBA Article Summary

1. Mental Health Challenges in Construction: The construction industry's high-pressure, physically demanding environment leads to significant mental health challenges. A study revealed that 83% of individuals in the industry have experienced a mental health condition, with factors like long hours, separation from family, chronic pain, and extreme working conditions contributing to increased risks of drug and alcohol abuse and a suicide rate four times higher than the general population.

2. White Cap's Mental Health ERG Initiative: Responding to employee feedback, White Cap launched a mental health employee resource group (ERG) in March 2023, aiming to foster conversation and provide resources for their 10,000 employees across 49 states. Initial attendance at ERG meetings ranged from 300-500 employees and continues to grow, with a 50-50 split between corporate and field staff. The ERG organizes expert-led sessions on various mental health topics, encourages vulnerability from leadership, and integrates mental health into branch meetings and communications.

3. Stomping Out the Stigma Campaign: Coinciding with the ERG's launch, White Cap initiated the "Stomping Out the Stigma" campaign to promote mental health awareness and encourage employees to seek help. The campaign utilizes social media to spread its message, aligning with the ERG's mission to destigmatize mental health and provide a safe space for discussion. The company ensures accessible communication methods, including emails, communal mental health pages, QR codes, and intranet resources, to reach its widely dispersed and often field-based workforce.

FDA approves a second Alzheimer's drug that can modestly slow disease

By NPR - U.S. officials have approved another Alzheimer’s drug that can modestly slow the disease, providing a new option for patients in the early stages of the incurable, memory-destroying ailment. Read Full Article…

HVBA Article Summary

1. FDA Approval and Impact: The FDA approved Eli Lilly’s Kisunla for treating mild or early cases of Alzheimer’s-related dementia. This marks the second drug, after Eisai’s Leqembi, shown to delay cognitive decline. Kisunla offers a seven-month delay in decline but involves regular IV infusions and risks like brain swelling.

2. Physician Perspectives and Treatment Considerations: Physicians view Kisunla's approval as a significant advancement after years of failed treatments. Kisunla and Leqembi are both laboratory-made antibodies targeting amyloid plaque in the brain, but patient eligibility, long-term benefits, and safety concerns, including higher rates of brain swelling, remain under discussion.

3. Economic and Logistical Challenges: Kisunla's annual therapy cost is set at $32,000, higher than Leqembi's $26,500. Discontinuing Kisunla if brain plaque levels drop could reduce costs and risks. However, logistical challenges like confirming brain plaque presence, setting up infusion centers, and ensuring trained staff for monitoring side effects may hinder widespread adoption.

Chevron Deference No Longer – Supreme Court Overturns Cornerstone of Administrative Law

By Shawn T. Cobb, Jennifer Jeffers, Daniel C. Warren and Jordan Wright - On June 28, 2024, the United States Supreme Court upended decades of precedent by overturning the Chevron doctrine in the combined cases of Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce (Case Nos. 22-451 and 22-1219). For nearly 40 years, a doctrine established by the 1984 Supreme Court decision Chevron v. Natural Resources Defense Council has dictated the framework used by the judiciary when reviewing how federal agencies interpret statutes. Read Full Article…

HVBA Article Summary

1. Overruling the Chevron Doctrine: The Supreme Court's recent decision overturns the Chevron doctrine, which mandated judicial deference to federal agency interpretations of ambiguous statutes. This ruling asserts that judges, rather than agencies, are responsible for resolving statutory ambiguities, marking a significant shift in administrative law.

2. Implications for Regulatory Agencies: With the Chevron doctrine no longer in effect, federal agencies will likely face increased litigation as regulated industries challenge agency interpretations. This decision may lead to a more cautious approach by agencies in their rulemaking and enforcement activities, potentially slowing the pace of new regulations.

3. Impact on Regulated Industries: Stakeholders in regulated industries should anticipate a period of uncertainty and increased legal challenges regarding agency statutory interpretations. The decision will likely result in a patchwork regulatory landscape as lower courts navigate the new legal framework without the Chevron doctrine's guiding principle of deference to agency expertise.