Health insurers push back on Biden’s 'burdensome' new mental health parity rules

By Scott Wooldridge - The long battle over mental health parity is heating up again, with the Biden Administration pushing for new regulations that would force insurers to prove that they are providing mental health care coverage comparable to other health coverage, and insurers protesting that such requirements will raise new costs and difficulties with compliance. Read Full Article…

VBA Article Summary

1. Historical Context and Recent Efforts: The article outlines the ongoing struggle to enforce mental health parity in health insurance coverage. It traces back to the first mental health parity law in 1996, highlighting its limitations due to loopholes and exceptions. Subsequent attempts in 2008 and 2010 made limited progress. The article emphasizes the Biden Administration's recent initiative, announced in July, to further strengthen mental health coverage through new rules proposed by the Departments of Labor, Health and Human Services, and Treasury. These measures aim to make mental health care more accessible and affordable, mandating stricter parity compliance and extending these requirements to government health plans.

2. Industry Opposition and Concerns: There is significant pushback from insurers and HR groups against the Biden Administration's proposed changes. These groups, including AHIP (the national association of health plans) and the American Benefits Council, argue that the new regulations are unrealistic, legally and operationally flawed, and could unintentionally harm mental health care access and affordability. They express concerns over the shortage of mental health providers and the potential burden on employer-sponsored plans, urging for more stakeholder feedback and clear, workable regulations that avoid negative impacts on health plan participants and beneficiaries.

3. Support from Providers and Patient Groups: Contrasting the industry's resistance, many provider groups and organizations representing consumers and patients show strong support for the new proposals. The American Psychiatric Association and the Mental Health Liaison Group endorse the Biden Administration's efforts, emphasizing the long-standing neglect of mental health coverage compared to physical health. They welcome the proposed rules as a means to improve access to mental health and substance use disorder treatment. Similarly, the American Hospital Association praises the initiative for reducing barriers to mental health services, thereby enabling better patient care and reducing administrative burdens for providers.

Here’s what you need to know about the Lower Costs, More Transparency Act

By Noah Tong - A House vote on transparency regulations in healthcare could occur next week, potentially having substantial ramifications on how PBMs and hospitals operate. Read Full Article…

VBA Article Summary

1. Legislative Overview and Advocacy Perspectives: The Lower Costs, More Transparency Act aims to reform healthcare by banning spread pricing in Medicaid, enforcing transparency rules, and pushing towards site-neutral payment reform. It has drawn attention from various advocacy groups. Lisa Hunter of US of Care views it as significant progress, despite not meeting everyone's expectations. The National Community Pharmacists Association supports the ban on spread pricing and transparency in drug pricing. Meanwhile, Families USA emphasizes the importance of families knowing healthcare costs upfront.

2. Concerns and Criticisms: Despite support, there are concerns about the bill's effectiveness. Michael Strazzella from Buchanan Ingersoll and Rooney doubts immediate price reductions and questions the impact of transparency measures. The Federation of American Hospitals, represented by Chip Kahn, opposes the act due to potential cuts to hospital care, especially in rural areas. The American Hospital Association seeks amendments regarding price estimator tools and penalties for non-compliant hospitals.

3. Political Dynamics and Related Legislative Actions: The bill's passage faces challenges in the House, requiring two-thirds approval amid political disagreements. It was temporarily pulled from the schedule but may resurface. The House Energy and Commerce Committee has advanced other healthcare bills targeting Pharmacy Benefit Managers (PBMs), indicating a broader legislative focus on healthcare reforms. Advocacy groups like the National Association of Chain Drug Stores express support for these PBM reforms and optimism for resolving disparities in the pharmacy sector.

Bipartisan reps introduce bill canceling 2024's 3.4% Medicare pay cut to physicians

By Dave Muoio - A bipartisan group of representatives has introduced a bill into the House that would undo a 2024 physician pay cut finalized last month by the Biden administration. Read Full Article…

VBA Article Summary

1. Medicare Physician Fee Schedule Cut in 2024: The 2024 Medicare Physician Fee Schedule includes a decrease in the conversion factor, leading to a 3.37% reduction in Medicare payments to physicians from 2023 levels. The Centers for Medicare and Medicaid Services justified this cut as a necessary measure to balance the budget, compensating for increases in payments for specific types of services, especially those involving primary and longitudinal care visits.

2. Opposition and Legislative Response: The proposed and final versions of the rule faced widespread opposition from the medical community, including major organizations like the American Medical Association and the Medical Group Management Association. They warned that the pay cut could force physicians to reduce healthcare services, limit office hours, or even stop treating Medicare patients. In response, Rep. Greg Murphy introduced the "Preserving Seniors’ Access to Physicians Act of 2023" (H.R.6683) to prevent the 3.37% cut from taking effect on January 1. The bill, co-sponsored by several other representatives, aims to amend the Social Security Act accordingly.

3. Implications and Further Developments: The American Medical Association (AMA) President, Jesse Ehrenfeld, endorsed the bill, highlighting the negative impact of the scheduled cuts on healthcare access for seniors and the financial stability of physician practices, especially in rural and underserved areas. The AMA also noted that after adjusting for inflation and practice costs, Medicare payments to physicians have effectively decreased by 26% since 2001. Furthermore, the Medicare Payment Advisory Commission (MedPAC) recommended a physician payment update tied to the Medicare Economic Index, proposing a slight pay increase of 1.3% for 2025.

Advocacy groups decry UnitedHealth's 'misleading' Medicare Advantage marketing

By Jakob Emerson - Groups advocating on behalf of older adults and people with disabilities are asking federal agencies for a "full-scale investigation" following what they say are misleading Medicare Advantage advertising practices by UnitedHealthcare. Read Full Article…

VBA Article Summary

1. Complaints Against UnitedHealthcare's Advertising Practices: Four advocacy groups, including the Center for Medicare Advocacy and the National Disability Rights Network, lodged a complaint to CMS and the FTC on December 7th. They allege that UnitedHealthcare's advertising in Connecticut misleads dual-eligible individuals (those eligible for both Medicare and Medicaid) by promoting extra benefits under a Medicare Advantage plan, such as dental or vision care, which are already covered by Medicaid or D-SNP coverage in Connecticut without copays or premiums.

2. Concerns Over Misleading Information and Potential Harm: The advocacy groups express concern that UnitedHealthcare's advertisements are designed to entice low-income older adults and disabled individuals into enrolling in their plan under the false impression of receiving additional healthcare benefits. They argue that these ads fail to disclose the limited network and restrictive prior authorization rules under UnitedHealthcare's plan, which might lead enrollees to unknowingly forfeit valuable benefits available through traditional Medicare plus Medicaid.

3. Demands for Action and UnitedHealthcare's Response: The groups demand punitive measures against UnitedHealthcare, including fines, a ban on further advertising in Connecticut, and mandatory notification to individuals enrolled in UnitedHealthcare about their coverage options. They also call for a national investigation into the marketing practices of all D-SNP by Medicare Advantage carriers. In response, a UnitedHealthcare spokesperson refuted these allegations, claiming their marketing efforts are transparent, accurate, and compliant with CMS guidelines.

Senators probe private equity’s role in hospital operations

By Susanna Vogel - Private equity investment in healthcare has accelerated over the past decade, with the firms investing approximately $750 billion in deals between 2010 and 2020. Read Full Article…

VBA Article Summary

1. Federal Scrutiny on Corporate Healthcare Investment: The U.S. federal government, including bipartisan senators Chuck Grassley and Sheldon Whitehouse, has launched initiatives to investigate the impact of private equity ownership on hospital quality. This includes an inquiry into how these investments affect patient costs and care quality. The Biden administration also announced measures to curb anticompetitive practices in the healthcare sector, focusing on non-traditional mergers and acquisitions that might lead to higher costs and poorer patient outcomes.

2. Increased Oversight and Transparency: The White House plans to enhance oversight on "roll ups" by private equity firms, a practice of conducting small acquisitions to consolidate market share. This initiative involves collaboration between the Department of Health and Human Services (HHS), the Department of Justice, and the Federal Trade Commission. Additionally, the Centers for Medicare & Medicaid Services (CMS) recently finalized a rule to increase transparency in nursing home ownership, particularly targeting private equity-owned facilities, following concerns about their quality.

3. Senate Investigation into Private Equity in Healthcare: Senators are intensifying their examination of private equity's role in healthcare. This includes a probe by Grassley and Whitehouse, motivated partly by a case in Iowa where a nurse at a private equity-owned hospital allegedly assaulted patients. The Senate inquiry is demanding information from executives of major private equity firms and healthcare organizations about their operational involvement in hospitals and the impact of their acquisition strategies on patient care and costs.

Ozempic side effects lawsuit can move forward

By Diana Novak Jones - A Louisiana federal judge on Friday largely rejected Novo Nordisk’s bid to dismiss one of the earliest lawsuits brought against the pharmaceutical company over side effects of its blockbuster drug Ozempic. Read Full Article…

VBA Article Summary

1. Judge's Ruling on Plaintiff's Claims: U.S. District Judge James Cain Jr. ruled that plaintiff Jaclyn Bjorklund provided sufficient evidence for her claim that Novo Nordisk failed to adequately warn her doctors about the risk of gastroparesis associated with their drug. However, he dismissed Bjorklund’s breach of express warranty claim, citing a lack of specific promises made by Novo Nordisk about the drug's safety. This dismissal was made without prejudice, allowing Bjorklund the opportunity to amend and refile her complaint.

2. Company Responses and Ongoing Litigation: Both Novo Nordisk and Eli Lilly, the makers of the drugs Ozempic and Mounjaro, respectively, which Bjorklund used to treat her Type 2 diabetes, have responded to the lawsuit. Novo Nordisk maintains that the side effects are well-documented and that the allegations are meritless. Eli Lilly also stated the lawsuit was without merit, emphasizing their continuous monitoring of drug safety. Additionally, Bjorklund's lawsuit has sparked nearly 20 similar lawsuits against these companies, all relating to the side effects of GLP-1 receptor agonists.

3. Legal Developments and Multidistrict Litigation Request: Attorneys from Morgan & Morgan, representing Bjorklund, have requested the U.S. Judicial Panel on Multidistrict Litigation to consolidate these lawsuits. They argue for Judge Cain to oversee the multidistrict litigation, citing his diligent attention to these cases. The case, Jaclyn Bjorklund v. Novo Nordisk, continues in the U.S. District Court for the Western District of Louisiana, with both legal teams actively involved.

5 Trends Shaping Healthcare Business Strategies for 2024

By Katie Adams - Deloitte released a report last week predicting the key trends that will shape the healthcare landscape in 2024. For its report, the consulting firm surveyed 60 health system and health plan executives who work at companies with an annual revenue of more than $500 million. Read Full Article…

VBA Article Summary

1. Mergers and Acquisitions (M&A): A significant trend in healthcare for 2024 is expected to be M&A, with about 90% of health system executives considering it impactful for their strategy. The trend, highlighted by major mergers like Kaiser Permanente-Geisinger and Froedtert Health-ThedaCare, is driven by a need for operational efficiency, cost-effectiveness, and integrated services. However, health plan executives are less concerned, with only a third considering it influential for their strategy.

2. Generative AI: The advent of generative AI, exemplified by tools like OpenAI's ChatGPT, is transforming healthcare. Hospitals are utilizing AI to forecast in-hospital mortality, stay duration, and claim denials, while consumers use it for health information and navigation. The technology is especially crucial in ensuring efficiency and consistency across consolidated health systems, helping to avoid bottlenecks and streamline processes.

3. Workforce Challenges, Outsourcing, and Affordability: Nearly 60% of health system executives anticipate labor shortages impacting their 2024 strategy, with a focus on improving employee well-being. To counter financial pressures, many systems are outsourcing tasks like billing and supply chain management. Additionally, affordability remains a key concern, with half of health plan executives worried about rising consumer costs. Healthcare leaders are advised to leverage digital tools to aid patients in navigating healthcare options and expenses.

Candid Conversations: Addressing mental health in the workplace

By Ava Martinez - One of the most monumental changes in the last decade is the increasing conversations around mental health in the workplace. Issues with mental health have always been around but until the last few years, they were matters to be hidden away for fear of being fired over these issues. Now, employees are growing more confident with acknowledging it as a part of their lives and employers have become more supportive about promoting mental health in the workplace. Read Full Article…

VBA Article Summary

1. Prevalence and Impact of Mental Health Issues: The article highlights the significant impact of mental health issues on the workplace, noting that approximately 12 billion working days are lost each year due to depression and anxiety, costing up to $1 trillion in lost productivity. It mentions that 15% of adults may have a mental disorder, and workplace stress can lead to burnout. The article underscores the need for businesses to support mental health to maintain employee stability and overall productivity.

2. Signs of Mental Health Issues at Work: The article points out that mental health problems are common in the workplace, with 1 in 6.8 people experiencing such issues. However, many employees fear discussing their mental health at work. Signs to watch for include frequent tardiness, exhaustion, mood fluctuations, changes in personality, and decreased quality of work. These indicators should prompt conversations and support, rather than being used to accuse employees of underperforming.

3. Supporting Mental Health in the Workplace: The article emphasizes the importance of creating a supportive work culture for mental health. This includes providing safe working conditions, improving employees' quality of life, and changing the work culture to be more supportive. Regular communication and understanding the diverse needs of employees are crucial. The article suggests that such measures can lead to higher productivity, employee retention, and a more successful organization.

After Wall Street balks, Cigna calls off Humana merger and instead is set to buy back up to $11.3 billion of it's shares in gift to investors

By Wendell Potter - If you had any doubt about how Wall Street runs our health care system, look at what is happening to Cigna’s stock price today, just 24 hours after the company said it had called off talks to buy Humana — and instead will reward its shareholders through a massive buyback of the company’s shares. Read Full Article…

VBA Article Summary

1. Stock Price Volatility Following Acquisition Talks: The article details the significant fluctuations in stock prices of Cigna and Humana following the announcement of their potential merger on Nov. 28. Cigna's stock plummeted from $284.74 to $261.64, marking its lowest in six months, while Humana's shares also dropped significantly from $510.45 to $482.41. This sharp decline reflected investor dissatisfaction with the merger idea, leading to a substantial selloff and a $12 billion loss in market capitalization for both companies.

2. Cigna's Response to Shareholder Concerns: In an effort to stabilize its stock price and appease shareholders, Cigna announced a significant increase in its share repurchase program. On Dec. 10, Cigna released a statement about allocating an additional $10 billion to its share repurchase program, aiming to buy back at least $5 billion of common stock by mid-2024. This move was interpreted as an attempt to increase shareholder value and counteract the negative reaction to the merger news.

3. Contrasting Outcomes for Cigna and Humana: While Cigna's stock price eventually soared, gaining more than 16% in value due to investor interest in the buyback program, Humana's stock continued to struggle. Humana's share value further declined, indicating ongoing investor skepticism. The article suggests that while Cigna's strategic financial maneuvers have been somewhat successful, Humana still faces challenges in regaining investor confidence.

CMS says states could lose funding over Medicaid redeterminations issues

By Emily Olsen - Medicaid enrollment soared during the COVID-19 pandemic as states paused checking eligibility for the safety-net program in return for enhanced federal funding. But that period of continuous enrollment ended in the spring this year, kicking off the redeterminations process that has removed millions from Medicaid. Read Full Article…

VBA Article Summary

1. Federal Intervention on Procedural Disenrollments: The Centers for Medicare & Medicaid Services (CMS) published an interim final rule to address the increasing number of procedural disenrollments during Medicaid redeterminations. This rule empowers federal regulators to demand corrective action plans from states that fail to comply with monthly reporting or eligibility requirements. Non-compliance could lead to the suspension of disenrollments, monetary penalties, and a reduction in federal funding for the Medicaid program.

2. Addressing the High Rate of Disenrollments: The new regulation responds to the disenrollment of nearly 11.8 million Medicaid beneficiaries, predominantly for procedural reasons, where eligible individuals are removed due to administrative issues. The federal government has already taken steps to halt such disenrollments, especially after the discovery that nearly 500,000 people, including children, were inappropriately removed from Medicaid and the Children’s Health Insurance Program.

3. Rigorous Compliance Measures: The interim final rule requires states to submit monthly reports on the redetermination process and maintain accurate beneficiary contact information. Non-compliance with these federal guidelines can result in fines of up to $100,000 per day and a potential reduction in the Federal Medical Assistance Percentage. This rule was issued swiftly without traditional notice-and-comment rulemaking to prevent further harm to beneficiaries, with comments open until February 2.