CMS finalizes rule to trim premiums: 5 things to know

By Rylee Wilson - CMS is implementing a final rule that will shorten the open enrollment period on the ACA exchange and create stricter eligibility verifications for enrollees. In a June 20 news release, the agency said the changes will lower individual premiums by around 5% on average, and save around $12 billion in 2026 by cracking down on improper enrollments. Read Full Article…

HVBA Article Summary

1. Stricter Enrollment and Verification Rules: CMS is implementing more rigorous eligibility requirements for ACA plans, including the repeal of a special monthly enrollment period for low-income individuals and mandatory income verification for premium subsidies. These measures aim to reduce improper enrollments and improve the overall risk pool, potentially leading to lower premiums.

2. Changes to Coverage Access and Timeline: Starting in 2027, the ACA open enrollment period will end on December 31 instead of January 15, encouraging continuous coverage throughout the year. Additionally, federal subsidies can no longer be used for gender-affirming care, and DACA recipients will be restricted from enrolling in ACA marketplace plans, reversing a prior CMS policy.

3. Subsidy Uncertainty and Impact: Expanded premium subsidies that contributed to record ACA enrollment—24.3 million in 2025—are set to expire at the end of 2025. These subsidies have significantly lowered average premium costs, and their potential expiration raises concerns about affordability and continued access for millions of consumers.

UnitedHealth unit hack may have exposed data of 5.4M users

By Allison Bell - Episource — a UnitedHealth subsidiary that helps health care providers bill plans and helps the plans analyze the claims — says attackers breached its computer systems. Episource managers believe a cybercriminal was in its systems from Jan. 27 through Feb. 6 and "was able to see and take copies of some data," the company said in a breach announcement posted earlier this week. "To date, we are not aware of any misuse of the data." Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Massive Breach and Suspected Perpetrators: Aflac and Episource have reported significant data breaches, with the personal and health-related information of up to 5.4 million U.S. individuals potentially exposed. While neither company has confirmed the identity of the attackers, sources familiar with the investigation say the breach methods align with tactics used by Scattered Spider, a cybercriminal group known for targeting U.S. companies with advanced social engineering.

2. Renewed Wave of Cyberattacks: These new breaches may signal the start of a fresh, potentially AI-assisted wave of cyberattacks aimed at the U.S. health benefits sector. This follows a slowdown in major incidents after the devastating 2024 Change Healthcare ransomware attack, which impacted about 190 million people. The resurgence suggests that attackers may be regrouping or evolving their methods, putting the industry on high alert.

3. Urgent Security Recommendations: In response to the growing threat, Google advises benefits companies to overhaul help desk security protocols. Staff should be trained to confirm employee identities using secure methods like in-person or video verification, and avoid relying on public data. Calls to known phone numbers or confirmations through corporate emails should be mandatory before changing security settings, as social engineering remains a key tactic used by groups like Scattered Spider.

Blue Cross Blue Shield of Michigan Sued for Alleged ERISA Violations

By James Van Bramer - Wesco Inc., a Michigan-based convenience store and gas station chain, has filed a complaint in U.S. District Court for the Eastern District of Michigan against Blue Cross Blue Shield of Michigan, accusing the insurance company of engaging in a scheme to unlawfully profit from employee health care plans it administers. Read Full Article…

HVBA Article Summary

1. Allegations of Fiduciary Misconduct: Wesco Inc. claims that Blue Cross Blue Shield of Michigan (BCBSM) breached its fiduciary duties under the Employee Retirement Income Security Act (ERISA) by enrolling self-funded health plans into a "Shared Savings Program" without the plan sponsors’ knowledge or consent. The lawsuit alleges BCBSM charged up to 30% in fees for correcting administrative errors—many of which were allegedly caused by BCBSM itself—resulting in unjust enrichment at the expense of plan participants.

2. Legal and Regulatory Context: The case highlights increasing legal attention to fiduciary obligations, particularly in the wake of the Consolidated Appropriations Act of 2021. This legislation amended ERISA to require that plan service providers, such as third-party administrators and pharmacy benefit managers, disclose both direct and indirect compensation to plan fiduciaries, thereby aiming to enhance transparency and accountability in health plan management.

3. Sought Remedies and Broader Impact: Wesco is pursuing restitution, disgorgement of Shared Savings Program fees, and other legal remedies, and is seeking to represent a broader class of similarly affected self-funded plans and sponsors. The complaint argues that BCBSM’s practices encouraged the acceptance of billing errors for later correction and profit, a method criticized as “presumptively unlawful” in a recent appellate court ruling, potentially setting the stage for wider legal challenges against similar fee structures.

Mapping the Vertical Integration of Insurers, PBMs, Specialty Pharmacies, and Providers: DCI’s 2025 Update and Competitive Outlook

By Drug Channels - It's time for Drug Channels’ annual update of vertical integration among insurers, PBMs, specialty pharmacies, and healthcare services within U.S. drug channels. As you can see below, we have revised, renovated, and refurbished our infamous illustration of the major vertical business relationships among the largest companies. Read Full Article…

HVBA Article Summary

1. Potential Cost Efficiencies Through Integration: Proponents of vertical integration argue that combining insurers, pharmacy benefit managers (PBMs), pharmacies, and healthcare providers under one corporate structure can lower healthcare costs and improve coordination of care. By owning multiple components of the healthcare delivery system, organizations gain access to internal data and pricing information, allowing for enhanced formulary management, site-of-care strategies, and patient-level interventions—especially for those requiring high-cost specialty drugs.

2. Anticompetitive Concerns and Market Distortions: Despite these potential efficiencies, vertical integration has triggered concerns over anticompetitive practices, such as inflated reimbursement rates for affiliated pharmacies, preferential treatment within PBM networks, and opaque intercompany transactions. These behaviors may limit competition, obscure financial realities, and raise costs for unaffiliated entities and plan sponsors. Regulatory bodies like the FTC have identified patterns of higher reimbursement rates for affiliated entities, particularly in commercial insurance plans.

3. Structural Shifts and Regulatory Scrutiny: The healthcare landscape continues to evolve through consolidation and selective unwinding of prior integrations, with large firms such as CVS and Optum generating significant internal revenue through their vertically aligned business units. These complex corporate structures challenge transparency and accountability, prompting growing scrutiny from regulators and raising questions about how vertically integrated organizations influence healthcare spending, pricing, and market dynamics.

Why Doctors Are Becoming the First Stop for Mental Health — and What Comes Next

By Dan Frogel - As demand for mental health care continues on its upward trend, many Americans are leaning on someone they already trust for support: their doctor. Research my company did found that nearly 1 in 5 people now seek mental health support from a primary care physician while Gallup recently reported seven in 10 Americans want a health provider to ask about their physical and mental health concerns. Read Full Article… 

HVBA Article Summary

1. Strained Primary Care and Mental Health Disconnect: Primary care physicians are increasingly expected to address both physical and mental health concerns within limited appointment times. This structural mismatch often leaves emotional and psychological issues inadequately treated, highlighting the urgent need for more integrated and specialized mental health support in medical settings.

2. Collaborative Care Model as a Scalable Solution: The Collaborative Care Model (CoCM) embeds mental health professionals within primary and specialty care teams to provide timely, coordinated support. Proven to improve outcomes and reduce costs, CoCM faces barriers to broad implementation, including limited reimbursement, infrastructure challenges, and a shortage of mental health providers.

3. Call for Systemic Investment and Coordination: To close the care gap without overburdening primary care, health systems must invest in collaborative care infrastructure, improve digital referral tools, and expand reimbursement models. Strengthening partnerships between behavioral and medical providers is essential to ensuring patients get the right care at the right time.

4 GLP-1 updates on costs, access

By Paige Twenter - GLP-1 medications such as Wegovy, Mounjaro and Ozempic helped drive a 9% year-over-year increase in U.S. prescription dispensing revenue, which reached $683 billion in 2024. A separate report found that among nonspecialty medications, there was a 6.3% increase in net cost from 2023 to 2024. Excluding GLP-1s, the increase would have been 3.5%. Read Full Article…

HVBA Article Summary

1. Novo Nordisk Drug Pricing Talks with CMS: Novo Nordisk is in active negotiations with the Centers for Medicare & Medicaid Services (CMS) to determine new prices for its GLP-1 drugs—Ozempic, Wegovy, and Rybelsus—which currently have list prices ranging from $900 to $1,300 per month. These medications cost Medicaid Part D $14.4 billion from November 2023 to October 2024. While final prices are not yet known, previous Part D negotiations have resulted in significant discounts between 38% and 79%.

2. Regulatory and Market Shifts in GLP-1 Landscape: The GLP-1 market is undergoing major shifts. Eli Lilly is cutting ties with telehealth firms that continue to sell compounded versions of its drugs, sidelining companies like Hims & Hers. Meanwhile, new partnerships such as Mark Cuban Cost Plus Drugs teaming up with 9amHealth aim to deliver discounted brand-name GLP-1 medications to self-insured employers. Additionally, the FDA has declared the shortage of drugs like Ozempic and Wegovy officially resolved, which restricts compounding pharmacies from making legal copycat versions—prompting pushback from that sector.

3. Emerging Safety Concerns with GLP-1s: New research has found a potential link between semaglutide—the active ingredient in Ozempic and Wegovy—and rare but serious eye conditions, including neovascular age-related macular degeneration and optic nerve damage. In one large study of over 139,000 patients, GLP-1 users had double the rate of macular degeneration compared to non-users (0.2% vs. 0.1%). Although this raises concerns, ophthalmology experts caution that patients with obesity or Type 2 diabetes already face elevated risks for these conditions.

TPA court ruling spotlights fiduciary violation

By Bruce Shutan - Benefit brokers and advisers who do business with third-party administrators (TPAs) need to be on their guard in the wake of a significant legal decision late last month. TPAs that control and profit from group health plan assets are fiduciaries under ERISA, according to a ruling by the U.S. Court of Appeals for the Sixth Circuit that reinstated fiduciary breach claims against a Michigan Blues plan. The case spotlights the importance of pricing transparency in TPA contracts with self-insured employers. Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Court ruling highlights fiduciary risk for TPAs and employers: The lawsuit against Blue Cross Blue Shield of Michigan revealed overpayments and improper retention of recovered funds, prompting experts to warn that third-party administrators (TPAs) may face increased legal scrutiny. Employers are being urged to conduct regular claim audits and establish documented fiduciary oversight processes.

2. Advisers and brokers face growing accountability: Advisers who receive compensation—especially undisclosed fees or bonuses—from TPAs they recommend may also be exposed to fiduciary liability. Experts emphasize that accepting indirect compensation without transparency can lead to breaches of fiduciary duty under updated legal standards.

3. Transparency and disclosure are essential fiduciary practices: Legal experts stress that both employers and advisers must ensure detailed and accurate disclosures of all compensation arrangements. Best practices include writing legally compliant RFPs, securing access to complete claims data, and avoiding conflicts of interest by choosing advisers who are solely compensated by the plan.