UnitedHealth Hits Panic Button: Ex-CEO Hemsley Reinstalled Amid Tumult

By Wendell Potter - The largest health care conglomerate in the world, UnitedHealth Group, stunned investors this morning with an abrupt leadership shakeup: CEO Sir Andrew Witty is out, and former chief executive Stephen Hemsley is back. The news — first reported by The Wall Street Journal — sent the company’s stock tanking more than 10% in premarket trading and triggered a sell-off among its competitors, including Humana, CVS/Aetna and Elevance. The carnage continued throughout the morning. Read Full Article…

HVBA Article Summary

1. UnitedHealth Faces a Crisis of Confidence Amid Plummeting Stock and Federal Scrutiny: UnitedHealth’s stock has dropped 50% in just six months, reflecting investor anxiety over rising medical costs, a poor Q1 earnings report, and multiple federal investigations into its Medicare Advantage billing practices and market dominance. The departure of CEO Andrew Witty and the return of former CEO Stephen : underscore a leadership crisis during a period of exceptional pressure on the company’s business model.

2. Hemsley’s Return Signals a Recommitment to Vertical Integration — Despite Legal Risk: The board has turned to Hemsley, architect of UnitedHealth’s aggressive vertical integration strategy, to stabilize the company. During his previous tenure, UnitedHealth grew into a dominant force by acquiring care delivery and pharmacy operations. That same strategy is now drawing antitrust scrutiny from the Department of Justice, raising concerns that the company may exert too much control over both financing and delivery of care.

3. Medicare Advantage Woes Expose Deeper Vulnerabilities in UnitedHealth’s Model: Once considered a pillar of growth, Medicare Advantage has become a liability for UnitedHealth, with unexpected care costs and reimbursement issues driving earnings misses and shaking investor confidence. Unlike its competitors, the company reported deeper-than-expected financial strain, prompting the rare move of pulling its 2025 forecast entirely—a sign that systemic cracks may be forming in its vertically integrated empire.

Trump administration weighs rolling back mental health parity rule

By Susanna Vogel - A growing body of data suggests Americans struggle to access mental healthcare, despite the 2008 Mental Health Parity and Addiction Equity Act requiring health plans that cover mental health and substance use care to cover mental health services at the same level as physical healthcare. Read Full Article…

HVBA Article Summary

1. Access Barriers to Mental Health Care: Insured individuals are nearly four times more likely to go out-of-network for mental health services than for physical health care, often facing higher costs or skipping care altogether. Contributing factors include outdated provider directories and burdensome prior authorization requirements that make accessing in-network mental health providers difficult.

2. New Parity Rule and Industry Pushback: A Biden-era rule mandates that private health plans evaluate and ensure parity in network adequacy, reimbursement rates, and utilization management for mental versus physical health services. However, payer groups and large employer coalitions, including AHIP and the ERISA Industry Committee, argue that the rule is overly complex and impractical to implement.

3. Legal Challenge and Regulatory Reassessment: The ERISA Industry Committee sued to block the rule in January. In response, the DOJ under the Trump administration agreed to pause the litigation and review the rule’s guidance. Employer groups welcomed the move, calling the original requirements “unworkable” and expressing hope for more feasible regulatory revisions.

How Large PBMs Make Money Today: A 2025 Drug Channels Update

By Adam Hardy - During my PBM Industry Update: Trends, Challenges, and What’s Ahead video webinar, I explored the latest trends, emerging data, and strategic shifts transforming the pharmacy benefit management (PBM) industry. Read Full Article…

HVBA Article Summary

1. Shift from Traditional Profit Sources: Large PBMs are increasingly moving away from older revenue models, such as mail dispensing of non-specialty drugs and retaining rebates from manufacturers. These once-core income streams now represent a smaller share of overall profits. Retail network spreads—once a notable driver of margins—also account for only a minimal portion of PBM earnings today, reflecting broader changes in the industry’s financial structure.

2. Rise of Specialty Dispensing Profits: Profits from specialty drug dispensing have become one of the most important revenue sources for large PBMs. This shift mirrors the rapid growth and high cost of specialty pharmaceuticals, which now represent a disproportionately large share of drug spending. PBMs often own specialty pharmacies, allowing them to capture more margin from managing complex therapies for chronic or rare conditions.

3. Increased Revenue from Manufacturer Fees and GPOs: Administrative fees collected from drug manufacturers and income generated through group purchasing organizations (GPOs) have become increasingly vital to PBMs' financial models. These revenue streams have grown in relevance as traditional profit mechanisms decline, and they allow PBMs to profit from channel management and purchasing scale without relying solely on rebates or dispensing.

Employers say their benefits are modern. Employees don’t agree, study finds.

By Ginger Christ - “The workplace is at a critical juncture and employee benefits are at the center of the shift,” the study said. Employers seem primed to make changes to better meet employee needs, the report found. Nearly 7 in 10 employers said they expect to make some change in their benefits offerings in the next two years, including 22% who plan to make either a significant change or a complete overhaul. Read Full Article…

HVBA Article Summary

1. Employers are reevaluating benefits to enhance employee well-being, retention, and experience: More than half of the 750 employers surveyed are reassessing their benefits strategies with the goal of improving employee well-being, increasing retention, and enhancing overall employee experience. Additionally, 4 in 10 employers are factoring in the rising cost of benefits as part of their decision-making process.

2. Customized and responsive benefits can help address employees’ real-life financial and workplace challenges: Employers are exploring more tailored benefits that align with how employees live and work, including support for saving for retirement, managing paycheck-to-paycheck living, navigating job insecurity, and accessing flexible work arrangements to reduce stress and increase engagement.

3. Enhanced benefits are essential as many employees face financial hardship and limited mobility: With nearly 3 in 4 workers struggling to afford anything beyond basic living expenses—and 12% unable to cover those essentials—employers can play a critical role by offering more robust benefits packages. This includes improved healthcare and retirement matching, clearer career advancement pathways, and access to education or certification programs that enhance earning potential.

Walgreens increasingly relies on robots for prescription fulfillment

By Alan Goforth - Although Walgreens customers expect to be greeted by a friendly human face, robots increasingly are filling their prescriptions behind the scenes. The pharmacy giant is expanding its use of so-called micro-fulfillment centers to control costs and free up staff to focus on other tasks. Read Full Article… ^{_{(Subscription required)}} 

HVBA Article Summary

1. Expansion and Operational Efficiency Goals: Walgreens aims to operate 11 micro-fulfillment centers serving over 5,000 stores by the end of 2025. These centers currently handle 40% of prescription volume—filling 16 million prescriptions monthly—and have already saved the company about $500 million by cutting excess inventory and increasing efficiency.

2. How the System Works: Prescriptions for chronic conditions that don’t require immediate pickup are routed to the micro-fulfillment centers, where robotic systems, supported by technicians and pharmacists, prepare and verify the orders. This approach reduces in-store workload and frees up pharmacy staff to focus more on patient care.

3. Strategic Value and Risks: While the system introduces risks such as potential supply disruptions from tech malfunctions, Walgreens views the benefits—lower costs, improved speed to therapy, and increased care quality—as outweighing the downsides. The centers are also seen as a key differentiator in the company’s broader strategy, especially as it plans to go private in a $10 billion deal with Sycamore Partners.

RFK Jr. asks for ideas about how to improve HHS regulations

By Allison Bell - Want Robert F. Kennedy Jr. to read your letter? You now have a chance. Kennedy, the secretary of the U.S. Department of Health and Human Services, has put out a request for ideas about how to improve HHS regulations. The HHS Centers for Medicare and Medicaid Services shares oversight over employer-sponsored health benefits with the U.S. Treasury Department's Internal Revenue Service and the U.S. Labor Department's Employee Benefits Security Administration. Read Full Article… ^{_{(Subscription required)}} 

HVBA Article Summary

1. Regulatory Feedback Solicited on Costly Rules: Presidential candidate Robert F. Kennedy Jr. is seeking public input on federal regulations that may impose excessive costs on private entities without delivering sufficient public benefits. He’s particularly interested in identifying rules that hinder small businesses and entrepreneurship. Comments must be submitted by July 14.

2. CMS and DOJ Launch Separate Reform Inquiries: CMS is also requesting ideas to enhance the U.S. health technology ecosystem, with feedback due 30 days after May 16. Separately, the DOJ’s Anticompetitive Regulations Task Force is gathering suggestions to improve healthcare system competitiveness, with a May 26 deadline for comments.

3. Access to Claims Data Highlighted as Employer Concern: Among the 68 comments received so far by the DOJ task force, many came from home health providers. One notable comment from Texas points out persistent challenges employers face in accessing health claims and utilization data from insurers, despite operating self-insured health plans that should entitle them to such information.

How innovative benefits can help win the engineering talent war

By The Hartford - The engineering sector is facing a major talent gap, driven by an aging workforce, rapid tech advancements and global competition. Every year, a third of U.S. engineering jobs go unfiled, leaving smaller firms vulnerable to larger employers that can better attract and retain top talent ¹ . Read Full Article… _{^{(Subscription required)}} 

HVBA Article Summary

1. Tailor Benefits to Compete for Specialized Engineering Talent: With rising demand for skills in AI, robotics, and renewable energy, small and midsize engineering firms must design benefits packages that go beyond basic health insurance. Offering voluntary benefits like life, disability, and accident insurance—with added services such as identity theft protection—can help attract highly skilled candidates while managing costs.

2. Support Holistic Well-Being to Enhance Retention and Productivity: As burnout affects 60% of U.S. workers, companies should implement wellness-focused benefits that address mental, physical, and financial health. This includes stress-reduction tools, mental health training, paid leave programs, and guidance on remote/hybrid work—all aimed at improving engagement and supporting new employees.

3. Leverage Flexibility and Sustainability to Win Talent: Engineers value flexibility, with remote work and paid leave increasingly seen as essential. Companies can enhance recruitment and retention by offering benefits like home office stipends, PTO, and support for off-site safety and productivity. Additionally, aligning benefits and career paths with sustainability goals—such as green commuting incentives and eco-focused projects—can appeal to purpose-driven engineers and help future-proof talent pipelines.