Government Shutdown Hurts Doctors, Health Insurers Benefit From Disruption

By Wendell Potter – Much of the reporting about the ongoing government shutdown focuses on the millions of Americans who are in danger of losing their health insurance if Congress lets health insurance subsidies expire. However, the shutdown itself is having negative effects on the health care system. The longer it goes on, the more it puts physicians and other health care providers in a precarious financial situation. The shutdown is in its 16th day because Republicans and Democrats are still at odds over whether Congress should extend federal subsidies that make health insurance affordable for people who are not eligible for employer-sponsored coverage or Medicare or Medicaid. Read Full Article...

HVBA Article Summary

1. Impact on Physicians and Health Care Providers: The government shutdown is causing significant financial strain on physicians and health care providers by delaying payments and slowing claims processing for Medicare and Medicaid. While insurers continue to operate normally, doctors face cash-flow disruptions and administrative challenges, often relying on lines of credit to keep their practices open. This financial pressure threatens the viability of many independent and physician-owned practices, which are critical to maintaining patient care access.

2. Reduced Oversight Benefits Insurers: During the shutdown, federal regulatory agencies such as the Centers for Medicare & Medicaid Services, the Department of Labor, the Federal Trade Commission, and the Health and Human Services’ Office of Inspector General scale back enforcement efforts. This reduction in oversight allows private health insurers to operate with less scrutiny, enabling them to delay claim payments, deny claims, and impose care restrictions without consequence. The shutdown thus amplifies the existing imbalance in the U.S. health care system, favoring insurers over providers and patients.

3. Broader Systemic Issues Highlighted: The shutdown underscores the U.S. health care system's heavy dependence on private insurers and the chronic under-resourcing of regulatory agencies, which has persisted regardless of political leadership. It also reveals how political dysfunction disproportionately harms frontline physicians and their patients while benefiting powerful insurers. Each lapse in government funding adds uncertainty and operational challenges for health care providers, pushing them closer to financial breaking points and threatening patient care continuity.

Governor Newsom signs major benefit mandates, vetoes others to protect health plans

By Allison Bell – California Gov. Gavin Newsom signed a major state major medical insurance benefits bill into law this week. The Democrat also vetoed some health benefits bills, arguing that those bills would do too much to weaken health plan care utilization management efforts and increase plan costs. The new EHB package law could have a direct effect on fully insured group health plan benefits. It may also end up influencing the default benefits package that some employers with self-insured health plans offer. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. New Essential Health Benefits Package Established: Governor Newsom signed Assembly Bill 224, which sets the guidelines for California's essential health benefits (EHB) package for 2027. This package defines treatments such as infertility, hearing aids, and durable medical equipment as essential health benefits. This law impacts fully insured group health plans and may influence benefits offered by self-insured employers. The EHB package aligns with the Affordable Care Act's requirement for states to define standard benefits packages.

2. Vetoes Based on Cost and Utilization Management Concerns: Newsom vetoed several health benefits bills that would have added coverage for HIV prevention products, menopause management, and behavioral health services for wildfire survivors. He objected to these bills because they would exempt these services from health plan utilization management, potentially increasing plan costs and premiums. Newsom emphasized the importance of affordability and responsible cost management amid rising healthcare premiums nationwide.

3. Implications for Employers and Health Plans: The new laws and vetoes signal Newsom's approach to balancing expanded health benefits with cost containment. While he approved hearing aid benefits as essential and signed a major pharmacy benefit manager regulation bill, concerns remain about the potential premium increases from new mandates. Employers and benefits managers in California may need to closely monitor how these legislative decisions affect health plan design and costs moving forward.

How the shutdown impacts healthcare: Judge blocks layoffs of federal workers

By Emma Beavins, Paige Minemyer, and Dave Muoio – A California judge has issued a temporary restraining order to halt layoffs at federal agencies under the ongoing government shutdown. Two key unions for government workers—the American Federation of Government Employees and the American Federation of State, County and Municipal Employees—sued the Trump administration on Sept. 30 in anticipation of a shutdown as the White House indicated it would lay off workers through reductions in force. Read Full Article...

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1. Judge Halts Federal Worker Layoffs During Shutdown: A California judge issued a temporary restraining order stopping layoffs at federal agencies amid the government shutdown. The ruling came after unions sued the Trump administration, which had begun reductions in force (RIFs) at agencies including the Department of Health and Human Services. The judge found the administration exploited the shutdown to carry out job cuts and ordered a halt to further layoffs and a review of those already conducted.

2. Significant Impact on Health Agencies and Workforce: The Department of Health and Human Services is furloughing over 32,000 employees, about 41% of its workforce, with roughly 600 CDC employees affected by layoffs. However, some termination notices were sent in error and later rescinded, highlighting operational challenges. Despite furloughs, mandatory health programs like Medicare and Medicaid continue, but core CDC functions and research activities face disruptions, raising concerns among healthcare stakeholders about public health risks.

3. Telehealth and Healthcare Services Affected by Shutdown: The Centers for Medicare & Medicaid Services (CMS) ended pandemic-era expanded telehealth flexibilities, implementing a temporary claims hold on telehealth services for Medicare beneficiaries. Providers are advised to notify patients about noncoverage and may face delays in claims processing. The shutdown also delays FDA acceptance of new drug and device applications, potentially impacting biopharma companies awaiting regulatory review.

Nearly all short-term health plans exclude maternity care, prescription drugs

By Alan Goforth – As President Donald Trump and congressional Democrats remain in a stalemate over extending premium tax credits under the Affordable Care Act, some consumers may consider purchasing short-term, limited-duration plans to fill the coverage gap. The administration announced that it would not prioritize enforcement actions for violations of consumer protections for short-term plans. “Taken together, these changes could lead more consumers to purchase less-expensive and less-comprehensive coverage, such as short-term plans, instead of a more comprehensive ACA plan this open enrollment season,” according to a new report from KFF. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Availability and Regulation Across States: Short-term health plans are sold in 36 states. They are prohibited in 5 states, and although 9 states and the District of Columbia have not explicitly banned them, short-term plans are not available there due to more extensive state regulations. KFF's analysis looked at 30 distinct short-term products across approximately 200 different plans offered by nine large insurers in one major city per eligible state.

2. Cost Comparisons and Underwriting Practices: The lowest-cost short-term plans can cost two-thirds or less than the lowest-cost unsubsidized bronze ACA Marketplace plans in the same area. However, the vast majority of Marketplace enrollees receive premium tax credits, which can reduce their actual cost to a similar or even lower price than short-term options. The lower premiums of short-term plans result from medical underwriting and exclusions for pre-existing conditions—individuals with cancer, obesity, or pregnancy are typically declined coverage.

3. Coverage Gaps and Financial Exposure: Deductibles for individual short-term plans in selected U.S. cities range widely, from $500 to $25,000, compared to $0 to $9,200 for bronze Marketplace plans. While silver and gold ACA plans offer lower deductibles, they also come with higher premiums. Among the short-term products reviewed:

   • 40% do not cover mental health services

   • 40% exclude substance abuse treatment

   • 48% do not cover outpatient prescription drugs

   • 94% exclude adult immunizations

   • 98% exclude maternity care

   Additionally, many plans impose limitations and exclusions not allowed in ACA-compliant plans—such as caps on primary care visits or inpatient hospital days—and most either lack out-of-pocket maximums or apply them only to certain costs. As a result, individuals choosing these plans to save on premiums may face significant medical bills if they need substantial care.

Preparing for open enrollment: Rx benefits redesign holds promise for cost control

By Bruce Shutan – As the 2026 open-enrollment season beckons, nowhere is the need for better benefits design more urgent than in the prescription drug arena — the fastest-growing portion of group health expenses for decades. Centivo Co-founder Alan Cohen notes the exogenous effects of GLP-1s and specialty drug that are driving up health care inflation. And with more employee cost shifting expected, he cautions that "we better get ready for 7% to 15% per year increases in traditional health coverage." Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Rising Costs Driven by Specialty Drugs and GLP-1s: The increasing use of high-cost specialty drugs and GLP-1 medications is a major factor driving health care inflation and rising prescription drug costs. Employers face significant challenges in managing these expenses while ensuring members have appropriate access to necessary medications. Experts predict annual increases in traditional health coverage costs could range from 7% to 15%, highlighting the urgency for cost containment strategies.

2. Importance of Partnering with Transparent PBMs: To control prescription drug costs effectively, employers should collaborate with pharmacy benefits managers (PBMs) that align with their goals and operate without financial conflicts of interest. Targeted clinical management, including formulary optimization and prior authorization reviews, can help reduce waste and misuse by focusing on the biggest cost drivers. High-touch clinical support for members with complex conditions ensures appropriate drug use, improving outcomes and reducing unnecessary spending.

3. Challenges and Opportunities with Biosimilars and GLP-1 Coverage: Encouraging the uptake of biosimilars presents a significant opportunity for cost savings, but adoption is hindered by complex formulary structures, high initial costs, and lack of education among prescribers and patients. Additionally, while GLP-1 drugs are increasingly used for weight management, experts caution that coverage should include counseling to prevent complications and ensure sustained benefits. Balancing access and cost remains a critical consideration in designing prescription drug benefits.

Medicare brokers: The last line of defense for older Americans

By Monica Ross-Williams – The independent Medicare broker community is standing on the front line of a storm that’s reshaping how older Americans access health care. Major carriers are quietly scaling back commissions, shrinking plan portfolios or leaving entire states altogether — and the ripple effects are starting to hit beneficiaries, not just agents. These aren’t isolated moves or short-term adjustments. They represent a deeper problem: the erosion of a sustainable, consumer-centered Medicare distribution model. Read Full Article...

HVBA Article Summary

1. Role and Challenges of Medicare Brokers: Independent, licensed Medicare brokers play a critical role in educating and enrolling older Americans in Medicare plans. They are required to maintain certifications and comply with strict regulations to ensure transparency and consumer protection. However, recent reductions in commissions and carriers withdrawing from markets are threatening the sustainability of this model, potentially leaving beneficiaries without expert guidance.

2. Risks of Replacing Licensed Brokers: Some carriers are substituting licensed brokers with unlicensed navigators, call-center operators, or volunteer counselors to cut costs. While these alternatives may seem efficient, they lack the legal accountability and expertise to provide detailed plan comparisons or verify coverage specifics. This shift increases compliance risks and may compromise the quality of consumer protection for Medicare beneficiaries.

3. Need for a Sustainable Compensation Model: The current commission-based compensation for Medicare brokers is eroding, which jeopardizes their continued presence in the market. The article suggests transitioning to fee-based or advisory-style compensation models, similar to those used by accountants or financial advisors, to maintain professional expertise in Medicare services. Without such changes, seniors risk losing advocates who understand their unique healthcare needs and can navigate the complex Medicare marketplace.

Lilly’s oral GLP-1 racks up two more clinical wins in diabetes

By Elizabeth Cairns – Eli Lilly’s GLP-1 pill has succeeded in two more late-stage trials in type 2 diabetes. The company said Wednesday that orforglipron beat AstraZeneca’s Farxiga at lowering patients’ blood sugar levels in one trial, and it topped placebo on the same measure in a different study in patients who were also taking insulin. The data bolster the case for the pill’s approval in diabetes that could come next year. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Orforglipron Showed Superior Blood Sugar Reduction Compared to Farxiga and Placebo: In the ACHIEVE-2 trial, the highest dose of orforglipron lowered A1C levels by 1.6% over 40 weeks, compared to a 0.8% reduction with Farxiga. In ACHIEVE-5, orforglipron combined with insulin (Basaglar) reduced A1C by 1.8%, while placebo plus insulin achieved only a 0.8% reduction, with statistical significance observed at all dose levels. These results indicate orforglipron may be a more effective oral treatment option for type 2 diabetes patients struggling with glycemic control on standard therapies like metformin.

2. Secondary Benefits and Safety Profile Were Positive but Not Fully Detailed: Lilly reported that orforglipron met all key secondary endpoints, including significant weight loss and improvements in cardiovascular risk markers. However, the company did not release the exact data supporting these outcomes, limiting independent assessment of their clinical relevance. The drug’s safety and tolerability remained consistent with earlier studies, suggesting a favorable risk-benefit profile so far.

3. Regulatory and Research Outlook Remains Active: Lilly intends to pursue regulatory approval for orforglipron in type 2 diabetes by 2026, following an earlier submission for obesity treatment planned for this year. A final trial, ACHIEVE-4, is ongoing to assess the pill’s effect on major cardiovascular events compared to insulin Basaglar, with data expected in the first half of next year. Beyond diabetes and obesity, Lilly is also exploring the drug’s potential use in sleep apnea, high blood pressure, and osteoarthritis-related pain in adults with obesity, reflecting a broad therapeutic development strategy.

Cleveland Clinic marks 15 years of offering high-value healthcare solutions to employers nationwide

By Laura Dyrda – Cleveland Clinic launched its Centers of Excellence program in 2010 with big goals of revolutionizing value-based care for large employers nationwide. The health system made a splash with its plan for direct-to-employer contracts and large national partners agreeing to send employees to Cleveland for nonemergent heart care. The health system introduced its Musculoskeletal Center of Excellence and Bariatric Center of Excellence in 2022 and then the Cancer Center of Excellence earlier this year. With focused centers staffed by clinical teams to achieve top results, the health system hoped to bend the quality and cost curve for partners. Read Full Article...

HVBA Article Summary

1. Significant Employer Partnerships and Patient Reach: Over 15 years, Cleveland Clinic's Centers of Excellence program has partnered with 2,000 employers nationwide, providing care to 16 million employees and dependents. The program has facilitated 60,000 patient encounters, demonstrating its extensive reach and influence in the employer healthcare market. This scale highlights the program's role in shaping value-based care delivery for large employer groups.

2. Cost Savings and Quality Outcomes: The program has delivered substantial financial benefits, including $55 million in total savings and $25 million saved through surgical avoidance. Employers participating in bundled pricing and travel programs have seen a 30% reduction in costs, alongside a 24% decrease in avoidable readmissions. These outcomes indicate the program's effectiveness in improving care quality while reducing healthcare expenses for employers.

3. Future Directions and Innovations: Cleveland Clinic plans to evolve its Employer Solutions program by integrating AI-powered predictive care and enhancing value-based payment models with performance guarantees. The program also emphasizes transparency and accountability to help employers manage rising healthcare costs, which are expected to increase significantly in the coming years. Virtual second opinions and clinical reviews are part of the current offerings, aiming to improve patient access and decision-making before traveling for care.