Trade groups urge CMS to expand, quickly finalize breakthrough device pathway

By Nick Paul Taylor - In June, CMS released a draft version of the Transitional Coverage for Emerging Technologies (TCET) pathway for consultation. The path could fill a gap created by the repeal of the contentious Medicare Coverage for Innovative Medical Technologies plan and address industry calls to cut the gap between device approval and reimbursement. Read Full Article…

VBA Article Summary

1. Shared Views and Recommendations: Both AdvaMed and MDMA submitted feedback to CMS on its new proposal. They showed mutual support for the program proposal, with MDMA viewing it as "a positive, incremental step" and AdvaMed “strongly supporting” it. Both groups desire CMS to swiftly implement the proposed changes. Notably, they both want the CMS to expand the TCET program to include breakthrough in vitro diagnostics approved by the FDA and products already available in the market.

2. Lookback Provisions: AdvaMed and MDMA have distinct ideas regarding "lookback" provisions. AdvaMed proposes a provision that would make breakthrough technologies authorized up to three years prior to the effective date eligible for TCET. Meanwhile, MDMA pushes for the inclusion of "currently marketed devices" and, at the very least, a lookback period.

3. Future Aspirations and Concerns: MDMA emphasizes that the new pathway should be the beginning of CMS's effort to promote breakthrough devices' coverage, not the culmination. They believe the notice doesn't utilize the full scope of CMS’s coverage authorities to genuinely speed up beneficiary access and inspire innovation. There are concerns that the TCET may not adequately address devices that are essential and practical but lack broad context. As a result, the decision-making process for these devices, which are handed over to local Medicare Administrative Contractors, might be murky and inconsistent, causing delays and challenges for manufacturers.

Why small businesses are craving more AI regulation

By Paola Peralta - As the value of artificial intelligence continues to be debated among larger industries and enterprise organizations, small businesses are struggling to understand how the technology may impact them. Seventy-three percent of small business owners in the U.S. are concerned AI development and adoption is outpacing regulation, according to a recent survey from Xero, a global small business platform. Thirty-eight percent listed sensitive information disclosure as their biggest concern, 36% data privacy violations and 35% worker displacement. Read Full Article…

VBA Article Summary

1. The State of AI in Small Businesses: Many small businesses view AI as overwhelming, often relegating it to the "too-hard" basket due to the continuous influx of new tools and limited time to understand them. As per Xero's survey, while 30% of small businesses have not yet taken any AI-related actions, 37% are experimenting, 25% are investing, and 19% have begun working with third-party AI experts. James Bergin from Xero emphasizes that aiding small businesses in grasping the potential advantages of AI technologies is crucial for their success.

2. AI's Potential Benefits and Drawbacks: AI has the capacity to dramatically streamline labor-intensive manual tasks and offer pertinent insights, enabling businesses to operate more efficiently. However, its implementation is not without challenges. Xero's survey indicates that 16% of businesses witnessed increased content biases or inaccuracies due to AI, another 16% saw reduced employee morale, 15% observed a drop in efficiency, and 15% faced reduced staffing. Furthermore, with almost half of business owners expressing trust in AI with sensitive customer and commercial data, there's potential risk involved in data handling.

3. Recommendations for Safe AI Implementation: Bergin advocates for the formulation of clear policies when utilizing AI tools. Businesses should consult with professional advisers regarding the nature of data interfacing with AI and its intended use. Establishing guidelines will aid businesses in navigating the risks associated with AI. For those who find the prospect of AI integration daunting, they can rely on third-party platforms like Xero. Ensuring the success of AI integration also means seeking areas where AI can truly benefit the business while always prioritizing security.

Pharmaceutical industry rips 'draconian' price negotiation provision

By Noah Tong - The Biden administration and federal regulators may be taking a victory lap following the unveiling of the Centers for Medicare & Medicaid Services’ (CMS') price negotiations list, but major players in the pharmaceutical industry feel the White House overstepped and think innovation will be stifled, ultimately leading to the creation of fewer life-changing drugs. Read Full Article… 

VBA Article Summary

1. Medicare Price Negotiations on Major Drugs: On Tuesday, the Centers for Medicare & Medicaid Services (CMS) announced that prominent drugs like Eliquis, Xarelto, Jardiance, and Januvia are now slated for price negotiations. These drugs were consumed by nearly 7.5 million Medicare Part D beneficiaries from June 2022 to May 2023, amounting to a gross cost of over $33 billion. The new pricing rules, introduced by the Inflation Reduction Act (IRA), require small-molecule drugs to face Medicare price negotiations after nine years on the market, whereas large-molecule drugs (biologics) have 13 years before price reductions. John Stanford from Incubate coined this as the "small molecule penalty".

2. Industry Concerns About Innovation and R&D: Biotech and pharmaceutical industries voiced strong opposition to the new price negotiation list, emphasizing its potential long-term effects on drug development. Critics believe that the IRA provision may cut into a drug's primary profitable years, affecting the financial incentives to invest in pharmaceutical R&D, thereby possibly hindering innovation. However, opposing views from sources like Gerard Anderson, Ph.D., from Johns Hopkins University, and a report from the Brookings Institution suggest that these price negotiations won't majorly impede innovation or new pharmaceutical product investments.

3. Pharmaceutical Industry's Stance and Future Implications: While opposing certain aspects, the pharmaceutical industry supports other elements of the IRA, such as capping out-of-pocket expenses and reducing the eligibility threshold for subsidies. Pharma groups, including the American College of Rheumatology and PhRMA CEO Stephen Ubl, emphasize that political decisions shouldn't determine the worth and accessibility of treatments and cures. They also highlight the need to address the root causes of drug pricing. CMS's plan to select more drugs for price setting in the coming years might influence venture capital groups' decisions on funding and drug development phases.

The Value in Health Care Act aims to incentivize providers to participate in value-based care models

By Maja Anderson - In a step forward for the healthcare industry’s push toward value-based care (VBC), on July 27, a bipartisan group of representatives introduced the Value in Health Care Act of 2023—a bill intended to incentivize more providers and healthcare organizations to adopt VBC models. Read Full Article…

VBA Article Summary

1. Shift Towards Value-Based Care: The Value in Health Care Act of 2021 emphasizes the transition from a traditional fee-for-service model to Medicare's alternative payment models (APMs). Brent Nicholson, from Carrum Health, explains that APMs prioritize the quality of care over the quantity of services, putting providers at the helm of outcomes and financial risks. Rep. Suzan DelBene, who co-introduced the bill, highlights the transformative nature of APMs, focusing on value rather than volume. She asserts that embracing APMs will not only enhance the quality of care but will also elevate health outcomes for the elderly.

2. Promotion of Accountable Care Organizations (ACOs): The legislation encourages medical providers to affiliate with ACOs, collaboratives aimed at delivering superior care while curbing needless healthcare expenditure. Such organizations have already proven beneficial, saving Medicare a whopping $17 billion over the past decade, as reported by the National Association of Accountable Care Organizations.

3. Legislative Changes and Industry Support: Key amendments in the legislation involve:

• Prolonging a Medicare incentive payment by two years, originally meant to lapse by the close of 2023, to encourage healthcare entities to adopt APMs.

• Empowering the Centers for Medicare & Medicaid Services to tweak the criteria healthcare establishments must satisfy to earn these incentives, with a special emphasis on fostering participation from rural practices.

• Charting a route for medical entities to assume increased levels of risk within APMs.

  Furthermore, the legislation also allocates funds to defray the initial costs of transitioning to a Value-Based Care (VBC) system. As Brent Nicholson elucidates, these overheads stem predominantly from the infrastructural setup essential for thriving within APMs. Garnering widespread acclaim, 17 prominent healthcare industry syndicates, inclusive of the American Hospital Association and American Medical Association, have endorsed the bill, viewing it as a pivotal step in redefining the paradigm of healthcare where financial results resonate with the caliber of patient care and not the sheer volume of services rendered.

How providing financial education to employees strengthens your business

By Shyam Pradheep - Financial education probably isn’t the first thing that comes to mind when you think about employee benefits. Most employers and business leaders tend to overlook financial education and instead think about more typical benefits like 401(k)s, stock options, PTO, or even mental health resources. But forgetting financial education is a mistake. Read Full Article…

VBA Article Summary

1. Boost Productivity and Reduce Costs: Financial stress significantly impairs employees' productivity, leading to substantial costs for businesses. The rise in lost productivity costs, from $26.9 billion in 2021 to over $40 billion in 2022, underscores the magnitude of this issue. By offering financial education, employers can alleviate this stress, enabling employees to focus better on their work and saving the company from financial losses due to decreased productivity. Providing financial knowledge equips employees to make informed decisions without wasting company time on external research or consultation.

2. Enhance Employee Attraction and Retention: Financial education stands out as the top desired benefit among employees today. As high as 54% of employees express their desire for employers to provide financial education. Particularly for the younger workforce like Gen Z, such benefits significantly increase their job satisfaction and loyalty. By offering financial education as a part of their benefits package, businesses not only address this demand but also position themselves as competitive employers, attracting high-quality talent and reducing turnover.

3. Strengthen Employee Engagement and Satisfaction: The tangible impact of financial education benefits extends beyond just individual employee well-being. Companies that have incorporated such programs report widespread positive outcomes. Specifically, 90% of these employers observe heightened levels of productivity, employee satisfaction, retention, and overall engagement. As financial literacy rates, especially among younger generations, continue to be a concern, the incorporation of financial education becomes an imperative solution. This intervention serves as a tool for both enhancing employees' quality of life and bolstering business health.

IRS Says Reimbursed Wellness Benefits Are Taxable

By Paul Mulholland - Regulators warn sponsors offering these plans should make sure they are not essentially compensating an employee for non-medical expenses. The Internal Revenue Service announced June 9 that wellness indemnity payments under a fixed-indemnity insurance policy count toward gross taxable income and cannot be treated on a tax-favored basis. Read Full Article…

VBA Article Summary

1. Description of a Wellness Indemnity Program: The IRS defines a wellness indemnity program as a plan where an employee's salary is deducted on a pre-tax basis. This deducted amount is later used to reimburse the employee for various health and wellness benefits. These benefits could range from weight-loss programs to diabetes management. However, since the money is returned for non-medical expenses, the IRS memo suggests that this should count toward the employee's taxable gross income.

2. IRS’s Illustrative Example: The IRS provides a practical example of how such a program operates. In the given scenario, employees at a hypothetical company contribute $1,200 as pre-tax monthly premiums to a wellness program via salary deduction. They then receive back $1,000 in compensation for wellness-related expenses. This means that if an employee saves over $200 in taxes, they are essentially purchasing something with pre-tax funds and subsequently receiving non-taxed compensation for non-medical costs.

3. Conditions and Legal Implications: The Groom Law Group clarifies that the tax implications only come into play if the employee has no unreimbursed medical expenses. Specifically, if an employee gains a wellness indemnity payment under a fixed indemnity health insurance policy, and the premiums were paid pre-tax through a cafeteria plan, the payment will be regarded as part of the employee's gross income. This is then subject to various taxes such as FICA, FUTA, and Federal income tax withholding, but only if there are no unreimbursed out-of-pocket medical expenses linked to that payment. Notably, the IRS's memo is not a formal directive but an insight into the agency's stance on the matter.

Employer Lawsuits Heat Up Against Health Plan Administrators

By Sara Hansard - Lawsuits by employers against insurers that administer employer health plans are beginning to mount, and workers could soon join the fray with litigation against employer-sponsored health plans. Kraft Heinz Co.‘s employee benefit plan filed a suit June 30 against Aetna Life Insurance Co. in the US District Court for the Eastern District of Texas, accusing the insurer of mismanaging the company’s health and dental plans by pocketing undisclosed fees and paying millions of dollars in claims that shouldn’t have been approved. Read Full Article…

VBA Article Summary

1. Transparency and Accountability in Health Benefit Costs: Employers offering health benefits to their employees are increasingly under the lens to ensure the validity and reasonability of the claims paid. Due to the Consolidated Appropriations Act, 2021 and the transparency in coverage rule from 2020, employers are becoming more conscious of the fees charged by hospitals and insurers. This awareness drives the necessity to validate the costs and the services offered under their health plans. Some employers, like Kraft Heinz, allege that plan administrators, such as Aetna, have approved false or questionable claims and haven't provided comprehensive claims data. Amy Gordon stresses that employers need to guarantee access to their claims data, especially since they bear the costs.

2. Lawsuits and Allegations of Fiduciary Breaches: Several lawsuits have been filed by employers against entities like Elevance Inc. and Blue Cross Blue Shield of Massachusetts, accusing them of breaching their fiduciary duty. The main accusation is that these plan administrators fail to provide employers with complete claims data, which prevents the employers from assessing if the health plans are being administered correctly. Christin Deacon mentions that if these allegations prove true, employers who don't address such behaviors could be at risk of facing lawsuits from their own employees for not upholding their fiduciary responsibilities.

3. Potential Expansion of Legal Scrutiny: Schlichter Bogard LLP, known for its lawsuits against employers concerning their retirement plans, seems to be seeking plaintiffs against large companies like Target, State Farm, and PetSmart regarding their health plans. These moves could pave the way for more allegations against companies concerning their fiduciary duties. While Jerome Schlichter downplays the global implications of these ads, Christin Deacon warns that if large entities, such as TPAs, are exhibiting questionable behaviors with major companies, similar issues could be present with other employers nationwide. Amy Gordon points out that recent contracts between health plan administrators and employers have incorporated more fees, emphasizing the need for employers to ensure transparency and no hidden expenses in their agreements.

Benefits Administration Software Market 2023 Growth, Trend, Share, and Forecast till 2030 | 125 Pages Report

By Market Growth Reports - In 2023, the growth of Benefits Administration Software Market is projected to reach Multi-million USD by 2028, In comparison to 2022, Over the next Seven years the Benefits Administration Software Market will register a magnificent spike in CAGR in terms of revenue, In this study, 2022 has been considered as the base year and 2023 to 2028 as the forecast period to estimate the market size for Benefits Administration Software. Read Full Article… 

VBA Article Summary

1. Growth and Valuation: The global Benefits Administration Software market was estimated at USD 1000.98 million in 2022. An anticipated CAGR of 10.56% is predicted from 2022 to 2028, bringing the market value to approximately USD 1827.71 million by 2028.

2. Market Segmentation:
   Types - On-Premise; Cloud-Based

   Applications - Small Business; Medium-sized Business; Large Business
   Geographical Analysis - The market analysis extends to representative countries from North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.

3. Influencing Factors and Trends: The COVID-19 pandemic has directly impacted production and demand, and this report encompasses pre and post-COVID-19 market outbreak analysis, including its financial consequences on businesses and markets. Key players in the market include SAP, BerniePortal, Ultimate Software, Ceridian, Paycom, among others. The report also highlights the importance of technological innovation, which will further refine product performance, potentially leading to a broader spectrum of downstream applications. Market dynamics, including drivers, restraints, opportunities, and emerging market trends, play a crucial role in shaping the trajectory of the Benefits Administration Software Market.