How Big Insurance Got So Big

By Wendell Potter – Almost sixteen years ago to the day, when Congress was debating what would become the Affordable Care Act, I warned lawmakers during a House hearing that if they acquiesced to the demands of the health insurance industry, they might as well call their bill the “Health Insurance Industry Profit Protection and Enhancement Act.” Ultimately, members of Congress felt they had no alternative but to cave to the industry’s pressure. Most notably, it stripped out a provision that would have created a Medicare-like “public option” to compete with Big Insurance, which President Obama had once said was necessary “to keep insurers honest.” Reflecting on the industry’s victory six years later in a commentary for the Center for Public Integrity, I wrote that when lawmakers killed the public option, they “threw consumers to the insurance wolves.” Read Full Article...

HVBA Article Summary

1. Massive Growth Fueled by Legislation and Consolidation: Since 2014, the seven largest for-profit health insurers have generated over $10 trillion in revenue and more than half a trillion dollars in profits. Their rapid expansion has been driven by consolidation and strategic exploitation of provisions in the Affordable Care Act (ACA) and the Medicare Advantage program. These companies have diversified far beyond traditional insurance into owning health care delivery businesses and pharmacy benefit managers, increasing their market power and revenue streams.

2. ACA's Mixed Impact on Consumers and Insurers: While the ACA made significant improvements such as prohibiting denial of coverage for pre-existing conditions and capping out-of-pocket expenses for in-network care, it also had unintended consequences. The law's subsidy structure and medical-loss ratio (MLR) requirements inadvertently encouraged insurers to grow larger and integrate vertically by acquiring health care providers. This has led to increased underinsurance among Americans and allowed insurers to steer patients toward their own more expensive health care services, circumventing the law's intent to protect consumers.

3. Dominance of Major Players and Taxpayer Funding: UnitedHealth Group stands out as the dominant insurer, earning nearly as much profit as the other six largest insurers combined, largely by leveraging ACA shortcomings and Medicare Advantage. The smaller insurers among the top seven rely heavily on taxpayer-funded Medicare and Medicaid programs. These insurers have also become powerful middlemen in the pharmacy supply chain, controlling a large share of pharmacy benefit management and retail pharmacy operations, further increasing their influence and profits at the expense of consumers and taxpayers.

House members release bipartisan ‘principles’ for extending Obamacare subsidies

By Benjamin Guggenheim and Meredith Lee Hill – A bipartisan quartet of House lawmakers released a “statement of principles” Monday for a potential compromise on an extension of Obamacare subsidies, which would include a two-year sunset and an income cap for eligibility. The compromise framework from Republican Reps. Don Bacon of Nebraska and Jeff Hurd of Colorado, and Democratic Reps. Tom Suozzi of New York and Josh Gottheimer of New Jersey, is the first public tangible offering on health care policy since the government shutdown began 33 days ago. Read Full Article...

HVBA Article Summary

1. Bipartisan Frustration and Moderate Push for Compromise: During the ongoing government shutdown, Democrats continue to demand that any reopening deal include an extension of the expanded Affordable Care Act (ACA) tax credits set to expire at the end of the year. President Donald Trump and Republican leaders have refused to negotiate on health care until the government is reopened. In response, a bipartisan group — Reps. Don Bacon, Will Hurd, Tom Suozzi, and Josh Gottheimer — proposed a two-year extension of the ACA tax credits with income limits between $200,000 and $400,000, aiming to break the partisan deadlock and restore public confidence in Congress’s ability to cooperate.

2. Efforts to Address Fraud and Oversight in ACA Programs: To appeal to conservative concerns, the proposal includes tighter oversight and anti-fraud measures. It seeks to prevent misconduct by agents and brokers, ensure enrollees understand the value of their subsidies, and identify “ghost beneficiaries” who may be improperly receiving ACA benefits. These accountability steps are designed to balance fiscal responsibility with maintaining affordable premiums for Americans relying on marketplace health plans.

3. Political and Practical Challenges Ahead: Despite bipartisan intent, the plan faces opposition from hard-line conservatives who reject extending any ACA subsidies and from others demanding deeper reforms. The proposal has not yet gained full backing from the Problem Solvers Caucus, and Rep. Brian Fitzpatrick has withheld his endorsement. Meanwhile, Senate Republicans such as Dan Sullivan, Lisa Murkowski, and Tommy Tuberville are developing alternative ideas. Without swift action, ACA enrollees in some states could see premiums rise by more than 100% by 2026, heightening pressure on Congress and the Trump administration to strike a deal.

HRSA approves 8 drugmakers' plans for 340B rebate model pilot program

By Heather Landi – The Trump administration has approved eight drugmakers' rebate plans for a controversial 340B drug discount pilot program that kicks off Jan. 1. The 340B Rebate Model Pilot Program, unveiled this summer, consists of a selected group of drugs from manufacturers that have submitted plans meeting specific criteria approved by the Health Resources and Services Administration (HRSA). The one-year test run will swap out upfront discounts for a limited number of products obtained through the 340B Drug Discount program for after-the-fact rebates as coordinated and distributed by manufacturers. Applications from drugmakers to participate were due Sept. 15. Read Full Article...

HVBA Article Summary

1. Pilot Program Structure and Scope: The 340B Rebate Model Pilot Program will run for one year and involves eight drugmakers whose plans were approved by the HRSA. Instead of providing upfront discounts on selected drugs, manufacturers will issue rebates to eligible providers after the drugs are dispensed and reported. The pilot is limited to ten drugs listed on the Centers for Medicare & Medicaid Services' Medicare Drug Price Negotiation Selected Drug List.

2. Stakeholder Reactions and Concerns: Hospital and health system groups have expressed strong opposition to the rebate model, arguing that it increases administrative burdens and may negatively impact patient access to discounted drugs. These groups estimate that hospitals will collectively spend significantly more time and resources on rebate applications than the government projects. There are also concerns that hospitals, especially those with limited liquidity, will have to cover higher upfront costs while waiting for rebates, potentially straining their finances.

3. Industry and Legislative Perspectives: While hospital groups and many providers oppose the pilot, the Pharmaceutical Research and Manufacturers of America (PhRMA) supports it, citing increased transparency and accountability in the 340B program. A bipartisan group of lawmakers has called for the program to be scrapped or for more information on how administrative burdens will be managed. The HRSA intends to use the pilot to gather feedback from stakeholders and inform future decisions about the 340B rebate model.

Trump administration nears deals for cheaper weight loss drugs with Novo Nordisk, Eli Lilly

By Daniel Payne, Elaine Chen, and Chelsea Cirruzzo – The Trump administration is nearing deals with Eli Lilly and Novo Nordisk to lower the prices of their weight loss drugs and expand access to them, people familiar with the talks told STAT. The companies have been close to a deal for weeks, one lobbyist with knowledge of the negotiations said, echoing others who said they believe the parties are closing in on an agreement. The deals have not yet been announced, and the details could still change. Read Full Article...

HVBA Article Summary

1. Potential Medicare Expansion and Pricing Agreements: The administration is reportedly close to deals with Eli Lilly and Novo Nordisk that would, for the first time, allow Medicare to cover GLP-1 weight-loss drugs. Medicare currently covers these only for diabetes and related conditions. The companies would also sell the drugs directly to consumers at reduced prices, with President Trump suggesting a drop from about $1,300 to $150 per month. Currently, Lilly’s Zepbound costs $349–$499, and Novo’s Wegovy is $499 per month, meaning the agreements could yield major price cuts if finalized.

2. Uncertainty and Lack of Official Details: The White House and both companies stress that negotiations are still underway, calling current reports speculative. Experts caution that even finalized deals might not substantially reduce costs, as prior White House agreements with Pfizer, AstraZeneca, and EMD Serono—offering “most-favored nation” pricing—had limited consumer impact. Without transparency on pricing mechanisms, analysts say it remains unclear whether these deals would meaningfully lower drug expenses or serve mainly as political milestones.

3. Political and Public Health Implications: If enacted, the deals would be among the administration’s most consequential health policy actions, potentially extending coverage to over 3 million Medicare beneficiaries and adding an estimated $25 billion in spending over 10 years, based on prior government projections. Expanded access could improve treatment for obesity-related conditions but may also raise concerns about long-term affordability. With Novo’s semaglutide already under Medicare price negotiations, the ultimate effect on drug costs and federal spending remains uncertain.

Legal benefits: High-utility player in a modern benefits strategy

By Tim Weber – In today’s dynamic benefits landscape, brokers are delivering solutions that meet the diverse needs of employees while helping employers stand out in a competitive labor market. Voluntary benefits remain a powerful way to create that value – offering flexibility, personalization and relevance for both organizations and their workforce. According to a recent Gallagher study, 77% of employers consider voluntary benefits essential to a comprehensive benefits strategy, and more than two-thirds plan to expand their offerings.— Legal plans have been adopted by many employers who recognize their measurable value across demographics, life stages, and benefit categories. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Broad Relevance and Accessibility of Legal Benefits: Legal insurance is increasingly recognized for its value across diverse employee demographics and life stages, providing support for common legal issues such as landlord disputes, family law, and debt management. It offers affordable access to legal professionals, bridging the gap created by high hourly attorney fees, which average $340 according to Clio’s 2024 Legal Trends Report. Digital-first access through online documents and virtual consultations enhances convenience and encourages employee engagement with legal services.

2. Integration with Other Voluntary Benefits Enhances Overall Value: Legal benefits complement other voluntary offerings like financial wellness, caregiving support, and family-building benefits by providing legal guidance that supports these areas. For example, legal plans assist with estate planning, elder care legalities, and navigating adoption or surrogacy processes, creating a more comprehensive support system for employees. This synergy helps employers deliver a cohesive benefits package that addresses the interconnected aspects of employees’ personal and professional lives.

3. Positive Impact on Employee Wellbeing and Productivity: Legal issues can cause significant stress, reducing employee focus, increasing absenteeism, and affecting mental health. Legal insurance alleviates these burdens by providing clear access to trusted attorneys and removing financial barriers, which helps employees feel more in control and less overwhelmed. When legal benefits are well implemented and supported with effective communication and resources, they can lead to higher employee satisfaction and productivity, benefiting both employees and employers.

Self-insured employer group cheers FDA plan to cut biosimilar testing

By Allison Bell – The head of the ERISA Industry Council — a group that represents self-insured employers — says a new Trump administration initiative could help bring down the cost of some of the most expensive drugs now on the market. James Gelfand, the president of ERIC, said draft guidance the U.S. Food and Drug Administration posted Wednesday could create new competition for "biologic" medications. Biologic drugs are medications created using living organisms, such as yeast or blood cells, rather than through the kinds of simpler chemical processes that people can manage. The FDA proposed eliminating some biologic product testing requirements. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Potential Cost Reduction for Biologic Drugs: The FDA's draft guidance aims to reduce testing requirements for biosimilar drugs, which could increase competition in the biologic drug market. Biologic drugs are notably expensive, costing about 20 times more than other drugs on average in the U.S. By facilitating biosimilar entry, the FDA hopes to lower prices and increase access to these medications.

2. Limited Biosimilar Development Currently: Despite the high cost of biologic drugs, only 76 biosimilars have been approved by the FDA, and only about 10% of biologic drugs expected to lose patent protection in the next decade have biosimilars in development. This limited development restricts competition and keeps prices high, highlighting the importance of regulatory changes to encourage biosimilar availability.

3. Support from Self-Insured Employer Groups: The ERISA Industry Council, representing self-insured employers, strongly supports the FDA's initiative, viewing it as a significant step toward removing barriers to biosimilar competition. ERIC's research indicates that biosimilars have already saved money for employers and employees, and the new guidance could amplify these savings by fostering greater market competition.

How to keep GLP-1s from driving a wedge in your workforce

By Lee Hafner – Employer coverage of GLP-1s is increasing, but if they're not paired with other, more inclusive offerings, benefit leaders may see these medications spark discontent. A new survey from global nutrition app Lifesum revealed that 74% of employees believe if employers provide GLP-1 medications like Ozempic, Wegovy and Mounjaro, it could lead to health inequalities within the workforce due to lack of affordability and eligibility. This doesn't mean that organizations should hold off on including them in their offerings, but access alone isn't enough — the employee experience must be considered as well, says Cecilia Hellström, Lifesum's workplace well-being director. Read Full Article...

HVBA Article Summary

1. Perception of Inequity in GLP-1 Coverage: A significant majority of employees, 74%, perceive that employer coverage of GLP-1 medications could foster health inequalities in the workplace. This concern arises from issues related to affordability and eligibility criteria, which may limit access to these medications to only certain groups of employees. Such perceptions can negatively impact workforce morale and create divisions among employees based on benefit accessibility.

2. Limited Complementary Support with GLP-1s: While many employers offer GLP-1 medications primarily for diabetes management or weight loss, only about 20% provide additional lifestyle or behavioral management benefits alongside these drugs. This lack of comprehensive support may exclude employees who do not qualify for GLP-1s and reduce the overall effectiveness of the medications for those who do, as behavioral and nutritional support are important for long-term success.

3. Need for Inclusive and Holistic Health Strategies: Experts emphasize that GLP-1s should be part of a broader health benefit strategy that includes nutrition, education, coaching, and behavioral health care. Such an approach ensures that all employees feel supported regardless of medication eligibility, promoting fairness and inclusivity. Employers benefit from this strategy by fostering a healthier workforce and enhancing the effectiveness of medical treatments through empathetic and inclusive programs.