Insurers prep for Trump admin friendly to Medicare Advantage and mergers, hostile to Medicaid and ACA

By Noah Tong - President Donald Trump has won back the White House, and with his win, many health plans are seeing their stocks rise. Likely expecting a more relaxed regulatory environment that loosens requirements on Medicare Advantage plans and encourages more mergers, some health insurers are reaping initial benefits. Read Full Article…

HVBA Article Summary

1. Stock Performance and Profit Updates: CVS Health, Humana, and UnitedHealth Group have seen notable gains in stock prices, while Elevance Health experienced a modest increase. CVS Health reported a third-quarter profit of $87 million, although its yearly profit has dropped from $6.3 billion in 2023 to $3 billion.

2. Medicare Advantage and Political Perspectives: President Biden faces criticism from insurer-backed groups over stricter Medicare Advantage regulations, aiming for higher standards. Trump’s potential re-election could favor Medicare Advantage plans, with proposals to make MA the default option and reduce regulatory constraints.

3. Merger Activity and Policy Implications: UnitedHealth’s acquisition of Amedisys and potential Medicaid funding cuts under a Republican administration reflect ongoing industry shifts. Cigna’s stock buybacks suggest a Humana merger is unlikely, while Centene and Molina Healthcare face market dips amidst ACA subsidy uncertainties.

'Gap-filler' health coverage sales rise 10%

By Allison Bell - Insurers are expanding efforts to sell workers critical illness insurance, hospital indemnity insurance, accident insurance and other products that can help them cope with high major medical insurance deductibles, co-payments and co-insurance bills. Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Growth in Supplemental Health Product Sales: Insurers' increased market focus has led to a 10% rise in gap-filler product sales, reaching $2 billion in the first half of the year. Notably, premiums from critical illness and hospital indemnity policy sales climbed 17% and 12%, respectively, with employer offerings of these products also expanding significantly.

2. Favorable Regulatory Environment: The regulatory framework allows insurers to fund supplemental health benefits with annual premiums and adjust them yearly without requiring large reserves. This flexibility and the lower-risk nature of the policies have made them attractive to insurers aiming to boost sales.

3. Market Dynamics and Competitive Landscape: Companies such as CNO Financial, Lincoln Financial, New York Life, and Prudential Financial have intensified their focus on supplemental health products, with some reporting strong gains. However, federal health policymakers continue to monitor to prevent these products from being used as cheaper substitutes for major medical insurance.

CMS finalizes telehealth pay changes: 5 notes

By Laura Dyrda - CMS released the 2025 Physician Fee Schedule final rule Nov. 1, including a plan to preserve certain telehealth flexibilities beyond the expiring temporary pandemic-era measures. Read Full Article…

HVBA Article Summary

1. Continuation of Limited Telehealth Flexibilities: CMS will retain certain telehealth flexibilities into 2025, including virtual supervision of auxiliary personnel by specific practitioners. This measure is designed to support patient care adaptability.

2. Temporary Virtual Supervision for Teaching Physicians: Teaching physicians can continue to supervise residents virtually during telehealth sessions, an extension by CMS to enhance accessibility and support in academic medical settings.

3. Return to Pre-Pandemic Telehealth Rules: On January 1, 2025, Medicare restrictions on telehealth services, including location and eligible practitioner limitations, are set to return unless Congress acts to extend current flexibilities.

WTW: There’s A Disconnect Between Employers and Employees on Wellbeing Programs

By Marissa Plescia - While employers are prioritizing mental and physical wellbeing programs, employees report that what they really want is financial wellbeing support, according to a new survey. The survey was released last week by WTW, a global advisory, broking and solutions company. It included responses from 535 employees at medium and large private sector employers. Read Full Article…

HVBA Article Summary

1. Discrepancy in Wellbeing Priorities: While 73% of employers prioritize mental wellbeing and 50% prioritize physical wellbeing, 66% of employees cite financial wellbeing as their main concern. However, only 23% of employers consider financial wellbeing a priority, highlighting a disconnect between employer and employee perspectives.

2. Financial Wellbeing and Mental Health Connection: Financial stress significantly impacts mental health, with only 41% of employees feeling financially secure. Employees may be seeking support such as college funding, retirement assistance, and financial planning tools to improve financial stability, especially among younger workers.

3. Employer Recommendations and Strategy: WTW recommends that employers adopt strategies like financial resilience coaching, financial education, and personalized financial support. Regular employee surveys are encouraged to better align wellbeing programs with employee needs, even if the focus shifts from mental health to financial support.

More than 90% of employees opt for the same health plan they previously had

By Alan Goforth - Despite the best efforts of brokers, more than 9 in 10 employees will select the same plan they had the previous year during open enrollment, a recent survey from Voya Financial found. Read Full Article… ^{_{(Subscription required)}}

HVBA Article Summary

1. Inertia and Limited Engagement: The study reveals that employee inertia affects benefits decision-making, with nearly half of eligible employees spending less than 20 minutes reviewing benefits information during open enrollment. While this suggests limited engagement, 80% of employees expressed an intention to spend more time on their choices this year.

2. Impact of Labeling on Plan Choices: The survey highlights how plan labeling affects decision-making, showing that employees are significantly more likely to choose a "Traditional PPO" over a "High-Deductible Health Plan" (HDHP). However, when the plans are presented without specific labels, the preference gap between PPO and HDHP narrows considerably.

3. Limited Understanding of Health Savings Accounts (HSAs): Only 3% of employees fully understand HSAs, with most unaware of their potential for retirement savings, tax advantages, and use as an investment vehicle. This indicates a need for better education to help employees leverage these accounts for long-term financial security.

GoodRx, PBMs accused of suppressing reimbursements to independent pharmacies

By Brendan Pierson - Drug coupon aggregator GoodRx and pharmacy benefit managers including CVS Caremark (CVS.N), and Express Scripts have been hit with at least three class action lawsuits accusing them of working together to suppress reimbursements to small pharmacies for generic prescription drugs. Read Full Article…

HVBA Article Summary

1. Lawsuit Overview: Three independent pharmacies have filed lawsuits in federal court against GoodRx and several pharmacy benefit managers (PBMs), alleging that recent agreements between GoodRx and PBMs have harmed smaller pharmacies. These agreements allegedly manipulate reimbursement rates, driving smaller, independent pharmacies out of the market.

2. Alleged Anticompetitive Conduct: The lawsuits claim that GoodRx and the PBMs engaged in price-fixing arrangements by using GoodRx's software to find the lowest discounts for generic prescriptions and process them through the most profitable PBM, regardless of the patient’s insurance coverage. This system reportedly leaves independent pharmacies with minimal revenue, as they’re only paid by patient cash, which PBMs do not reimburse.

3. Violation of Antitrust Laws: The lawsuits, which seek to represent a class of similarly impacted pharmacies, argue that these practices violate the Sherman Antitrust Act, an act designed to prevent monopolistic behavior. The plaintiffs are requesting both an injunction to halt further anticompetitive actions and monetary damages. The complaints come amid broader concerns over PBMs’ influence on drug prices, an issue under increased scrutiny from the U.S. Federal Trade Commission.

States slow to cover GLP-1s for weight loss

By Tina Reed - Budget pressures have kept all but 13 states from covering GLP-1 drugs for weight loss through their Medicaid programs, a new report from KFF shows. Read Full Article… 

HVBA Article Summary

1. Equity and Access Challenges: Restrictive Medicaid policies limit access to GLP-1 weight loss drugs, raising equity concerns as these drugs could significantly benefit the nearly 40% of adults and 26% of children with obesity in Medicaid. However, expanding coverage may strain state budgets, creating a tension between health benefits and financial feasibility.

2. Employer and Medicare Limitations: Coverage for GLP-1s for weight loss is limited among large employers and ACA markets, and Medicare prohibits it altogether. Despite this, there is a growing trend of GLP-1 coverage for other health purposes, like heart attack prevention, which is driving up health spending.

3. State Variability in Medicaid Coverage: While a dozen states now cover GLP-1s for obesity treatment under Medicaid, most require utilization controls, such as prior authorization or minimum BMI. This indicates a cautious, controlled approach to managing costs, with states increasingly considering coverage expansion despite financial and regulatory challenges.