Managing the Exploding Costs of Specialty Drugs | with Jake Velie

By Spencer Smith – In this powerful conversation with Jake Velie of National Integrative Health, the discussion breaks down how smarter pharmacy management, infusion redirection, and clinical oversight can create real savings without sacrificing member care. "There's no reason why I should be able to do an infusion for 50% of the cost of what it's currently being allowed at. We've seen allowed amounts between $57,000 and $80,000 for Keytruda. I typically can have that in the home at $29,000." Read Full Article...

HVBA Article Summary

1. Hospital Markups and Site-of-Care Shifts Drive Major Cost Differences: The episode highlights how facility-based infusions often carry significant markups compared to home-based alternatives. By redirecting patients away from hospital outpatient departments to home infusion settings, employers can meaningfully reduce plan spend without changing the underlying medication. National Integrative Health has built a 50-state network specifically to facilitate these transitions. The discussion frames site-of-care management as one of the most practical levers for self-funded employers to control specialty costs.

2. Specialty Drugs Dominate Pharmacy Spending: Specialty medications are described as accounting for roughly 90% of total pharmacy spend for many plans, making them the primary driver of escalating costs. The conversation explores how J-codes and Q-codes, along with unmanaged biologics, can inflate claims when left unchecked. NIH positions itself as an independent pharmacy solution that actively manages these high-cost categories. The emphasis is on proactive oversight rather than reacting after large claims have already hit the plan.

3. Formulary Enforcement, GLP-1 Management, and Sourcing Strategies Matter: The episode addresses challenges around GLP-1 adherence and explains why the organization avoids 90-day fills for weight-loss medications to reduce waste and misuse. It also details how employers can transition patients from high-cost biologics like Humira to lower-cost biosimilars such as Yusimry through firm formulary enforcement. Additionally, the conversation touches on international drug sourcing and related safety considerations. Together, these strategies are presented as part of a broader specialty drug cost-containment framework for self-funded plans.

4. Three ways to Watch. Tune in through the links below:

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In 3-game healthcare series, underdog large-language models sweep specialized AI powerhouses

By Dave Pearson – Pitting three multipurpose LLMs against two healthcare-specific AI tools, researchers have discovered the consumer-level AI can beat its purpose-built counterparts in healthcare scenarios—and soundly, at that. To be sure, the one-size-fits-all models were among the most advanced in their respective makers’ frontier AI quivers—OpenAI’s GPT-5.2, Google’s Gemini 3.1 Pro and Anthropic’s Claude Opus 4.6. Still, their rivals in the academic showdown, OpenEvidence’s OpenEvidence platform and Wolters Kluwer’s UpToDate Expert AI, are purpose-built for aiding clinical decision-making with evidence grounded in research. Read Full Article...

HVBA Article Summary

1. Frontier LLMs Outperformed Across All Benchmarks: The study evaluated three leading general-purpose models against two healthcare-specific AI tools using three separate assessments. These included 500 MedQA questions to test knowledge, 500 HealthBench items to gauge clinical alignment, and a newly created Real Clinical Queries benchmark based on 100 de-identified physician prompts. In each of these evaluations, the large multipurpose models achieved stronger overall performance than the specialized clinical platforms. The results suggest that broad, high-capacity models can compete effectively even in domain-specific medical tasks.

2. Real-World Clinical Testing Added Rigor: For the Real Clinical Queries benchmark, 12 U.S. clinicians conducted randomized, blinded reviews of model responses. This process generated 1,800 model-question annotations, providing a substantial dataset for comparison. Notably, the specialized clinical AI tools performed similarly to Google Search’s AI Overview feature on this benchmark. The authors argue that such independent, practice-based testing is essential before deploying AI systems in patient-care environments.

3. Implications for Procurement and Oversight: The researchers conclude that scale, alignment strategies and cross-domain reasoning may be more influential than narrow domain tuning in determining medical competency for certain tasks. While specialized tools often carry institutional credibility and are considered safe for routine use, they did not demonstrate superior knowledge or communication in this study. The findings raise questions for healthcare leaders about technology purchasing decisions, reimbursement models and regulatory frameworks. The authors suggest hospital-specific LLMs and careful task selection may offer a balanced path forward.

Novo's top US exec wants more insurance coverage for weight-loss drugs

By Chris Prentice – Denmark's Novo Nordisk (NOVOb.CO), the maker of weight-loss drug Wegovy, hopes insurance will cover more U.S. users of the medication and balance direct-to-consumer sales that have driven the fast-growing market, the company's top ‌U.S. executive said. Read Full Article...

HVBA Article Summary

1. Shift Toward Balanced Sales Channels: Novo Nordisk’s U.S. leadership wants a more even split between insurance-covered and self-pay purchases for its GLP-1 weight-loss drugs. Currently, 30% of injectable GLP-1 sales by volume come from direct-to-consumer purchases, while about 90% of Wegovy pill sales are paid out of pocket. The company believes a more traditional insurance-driven model would provide greater long-term stability. However, achieving that balance depends on addressing insurers’ concerns about rising costs.

2. Pricing Strategy and Cost Pressures: Wegovy carries a U.S. list price of roughly $1,350 per month, though Novo plans to cut that to $675 in 2027. In the meantime, self-paying patients can access the drug for $149 per month through manufacturer discount programs. Insurers and employers have pushed back on covering GLP-1 drugs due to their financial impact, with some planning to drop coverage. Novo is offering discounts and negotiating with payers to make broader reimbursement financially sustainable.

3. Government Pilot Could Expand Access: A new U.S. Medicare pilot program launching in July will cover GLP-1 drugs specifically for weight loss, marking the first time the program includes that indication alone. The initiative will run through 2027 and allow eligible seniors to obtain the drugs for $50 per month. Medicare already covers these medications for certain other health conditions, but this expansion is expected to increase demand significantly. Novo declined to estimate how the pilot will affect its sales volumes.

Is the Payer-Provider Battle of the Bots Driving Healthcare Costs Higher?

By Luke Gale – Last year, PwC projected a 8.5% medical cost spike in the commercial group market. Unfortunately, the professional services company's forecast for the next year does not suggest there will be any relief for rising healthcare costs. Read Full Article...

HVBA Article Summary

1. Commercial Medical Costs Expected to Remain Elevated: PwC’s latest report shows that the 2026 group cost trend was adjusted upward to 9.0%, and actuaries expect that same 9.0% growth rate to continue into 2027 for group plans. The individual market is also projected to see an 8.5% increase. With traditional cost offsets like biosimilars and site-of-care shifts already absorbed into baseline pricing, the report characterizes the outlook as a structural shift rather than a temporary surge. This suggests employers and consumers should prepare for sustained pricing pressure rather than a near-term correction.

2. Five Key Cost Drivers Intensifying Financial Pressure: Health plan actuaries identify multiple inflators, including AI-enabled documentation that increases billing intensity, rising provider reimbursement demands, and surging pharmacy costs. Cancer drug spending alone reached $143 billion in 2025, while GLP-1 therapies continue expanding into new clinical indications. Behavioral health utilization rose 62.6% between 2018 and 2024, driven by higher visit volumes rather than price alone. Additionally, providers prevailed in roughly 88% of Independent Dispute Resolution cases in early 2025, contributing to $5 billion in associated costs.

3. AI Arms Race Creating Administrative Friction: Providers are leveraging AI tools to optimize coding and capture higher-acuity reimbursement, while payers are deploying automated pre-payment reviews and anomaly detection systems. This technological back-and-forth is increasing administrative complexity instead of reducing systemic costs. Leaders cited in the article argue that this friction can delay or interrupt patient care, ultimately affecting access. To mitigate reputational and financial risk, revenue cycle executives are encouraged to prioritize transparent, empathetic pre-service financial clearance rather than relying heavily on back-end collections.

340B volatility hangs over employer pharmacy strategy

By Josh Canavan – Recent volatility surrounding the 340B drug pricing program should alert employers: Instability in the drug pricing system can have an oversized effect on plan performance in the forms of cost, access and employee experience. When drug savings depend too heavily on policy-driven discount structures outside an employer's control, savings become unpredictable. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Heavy Reliance on 340B Discounts Carries Risk: The article argues that employers who depend primarily on 340B-related pricing arrangements are exposed to legal, regulatory and manufacturer-driven changes. In 2024 alone, 340B-covered entities purchased $81.4 billion in outpatient drugs, illustrating how much spending flows through a program under ongoing scrutiny. Because court rulings or policy shifts can quickly alter how discounts are applied, savings tied to these mechanisms may not be durable. Employers are encouraged to distinguish between temporary pricing advantages and structurally sustainable cost controls.

2. Waste Reduction Offers More Stable Savings: The author points to oversupply and duplicative therapy as consistent drivers of unnecessary pharmacy spending. Research cited shows that about two-thirds of dispensed prescriptions go unused, with projected national costs between $2.4 billion and $5.4 billion annually. Additional studies found that more than 75% of high-risk patients had medication discrepancies after hospital discharge, and U.S. polypharmacy prevalence rose from 8.2% in 1999-2000 to 17.1% in 2017-2018. Addressing these utilization issues can create savings that are less vulnerable to policy volatility.

3. Member Experience and Adherence Are Central to Cost Control: The piece emphasizes that pharmacy strategies should improve the employee experience rather than rely solely on financial engineering. Chronic disease medication nonadherence is estimated at 30% to 50%, contributing to as many as 25% of hospitalizations and up to $528 billion in annual systemwide costs. Strategies that reduce unnecessary refills and overlapping therapies can simplify regimens and build trust in the benefit. By aligning cost management with adherence and clarity, employers may avoid recreating avoidable utilization expenses.

How employers can support mentally, financially strained caregiver staff

By Jimmy Nesbitt – The cost of caring for America's aging population is straining caregivers, with 77% saying they have been financially overwhelmed, according to a new survey. The findings from medical device supplier Aeroflow Urology also highlight the emotional toll on caregivers: 76% say their mental health has been affected since taking on the role in tandem with their careers. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Caregiving Is Taking a Significant Emotional and Workforce Toll: More than half (57%) say they have reduced their work hours, and 11% have left their jobs entirely due to caregiving demands. These employment shifts highlight how caregiving responsibilities directly affect workforce participation. The data suggests employers may face retention and productivity challenges if support systems are not strengthened.

2. Long-Term Demographic Trends Will Intensify Demand: By 2030, 26 states are projected to have at least 20% of their populations aged 65 and older, increasing the need for long-term care. A 2025 report estimates that 63 million Americans currently serve as family caregivers, underscoring the scale of the issue. Many caregivers are in prolonged roles, with 73% providing care for more than five years. As the population ages and chronic conditions become more common, employers are likely to see growing numbers of workers juggling caregiving duties.

3. Financial Pressures Extend Beyond Lost Wages: Forty-two percent of caregiving households earn less than $75,000 annually, yet many face recurring out-of-pocket expenses. One in four caregivers spends more than $500 per month on supplies, and 57% report their loved one experienced more severe complications due to insufficient resources. Additionally, 77% rely on government assistance programs such as SNAP and Supplemental Security Income alongside Medicaid or insurance. These figures point to systemic gaps in coverage and support that employers could help address through targeted benefits like care coordination and specialized navigation services.

The perils of connecting wearables with medical records

By Tina Reed – A flurry of moves by health tech companies to promote more patient data sharing is raising red flags over the way it could expose personal information. Why it matters: The moment someone pulls data from their doctor's office, it's no longer covered by HIPAA, the landmark privacy law that safeguards personally identifiable health information. Read Full Article...

HVBA Article Summary

1. HIPAA Protections May Not Follow the Data: Experts note that HIPAA establishes a baseline level of safeguards, but outside of it, protections depend largely on company policies and user agreements. That shift can expose consumers to inconsistent standards and potential misuse of their health data. Privacy advocates warn that many users may not realize they are relinquishing federal protections when authorizing data transfers.

2. Health Tech Companies Are Pushing Integration: Companies like Whoop and Oura are partnering with health data platforms to allow users to combine wearable metrics with official medical records. Supporters argue that integrating continuous monitoring data with clinical records can generate more meaningful insights and improve personal health management. Some of these efforts are tied to federal interoperability initiatives designed to promote secure information exchange. Industry groups backing the expansion say voluntary codes of conduct and ecosystem commitments provide strong privacy and security assurances.

3. Regulatory Gaps and Policy Debate Persist: Hospitals and health IT leaders caution that consumer health apps are not subject to the same strict privacy limitations as providers and insurers. Outside of HIPAA, oversight falls to a mix of state laws, company policies and Federal Trade Commission enforcement focused on unfair or deceptive practices. Lawmakers would need to amend HIPAA or pass new legislation to create uniform protections for wearable and app-based health data, but such efforts have stalled. As data-sharing tools expand, the tension between innovation and comprehensive privacy safeguards remains unresolved.

U.S. health care affordability falls to lowest level since 2021

By Lucy Peterson – New findings from the latest West Health–Gallup Healthcare Affordability Index, which tracks Americans' ability to access and pay for health care, show that fewer than half of U.S. adults (49%) can consistently afford the care and prescription medications they need when they need them. Over the past year alone, 2.8 million Americans have fallen out of this "Cost Secure" category, unable to keep pace with rising health care costs — bringing affordability levels to their lowest point since the Index launched in 2021. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Affordability Continues to Decline Nationwide: The latest index data show a continued downward trajectory in Americans’ ability to pay for medical care and prescriptions. The share of adults considered financially secure in accessing care has fallen to its lowest level since the survey began in 2021. This erosion reflects persistent cost pressures that are outpacing household incomes. The findings suggest that affordability challenges are becoming more entrenched rather than temporary.

2. Disparities Are Widening Across Racial and Ethnic Groups: The report highlights significant gaps in cost security among Black, Hispanic and White adults. Since 2021, affordability has declined more sharply for Black and Hispanic adults than for White adults, leading to expanding disparities. These differences indicate that rising health care costs are disproportionately affecting communities of color. The data point to structural inequities that may require targeted policy responses.

3. Middle-Income and Younger Adults Feel Growing Strain: Financial vulnerability is not limited to low-income households, as a notable share of upper-middle- and high-income earners also report difficulty affording care. Young adults ages 18 to 29 experienced the steepest drop in affordability in recent years. This trend suggests that insurance coverage alone may not shield households from high out-of-pocket costs and premium increases. The sustained decline among younger and middle-class populations underscores the broadening scope of the affordability crisis.