Government expects to recover more than $3B from healthcare fraud, misspent funds in fiscal year 2023

By Emily Olsen - The HHS’ OIG oversees over a hundred health programs that provide services for more than 150 million Americans, including the senior health insurance offering Medicare and the safety-net Medicaid program. Read Full Article…

VBA Article Summary

1. Substantial Recoveries and Enforcement Actions: The HHS’ Office of the Inspector General (OIG) is projected to recover over $3.44 billion in fiscal year 2023, following investigations into fraud and misuse of funds in Medicare, Medicaid, and other government health programs. The OIG's semiannual report recorded 707 criminal enforcement actions and 746 civil actions, including false claims and civil monetary penalty settlements. The report covers the period from October 1, 2022, to September 30, 2023, during which the OIG excluded over 2,000 individuals and entities from federal healthcare programs.

2. Areas of Fraud and Mismanagement: Investigations revealed various instances of mismanagement, including Medicare improperly paying for psychotherapy services, regulators failing to accurately report safety and quality issues in nursing homes, and disparities in access to opioid use disorder medications in Medicaid. The OIG also noted issues in billing for psychotherapy services in Medicare, particularly in telehealth, with $580 million of the $1 billion paid being deemed improper payments. Additionally, cybersecurity concerns are growing due to increased healthcare data breaches, with an OIG report in the spring highlighting inefficiencies in security controls at the CMS.

3. Focus on Emerging Technologies and Managed Care: The report emphasizes the dual nature of emerging technologies, which, while beneficial for patient care, also present new fraud risks. This includes the case of 78 defendants charged for falsely billing $2.5 billion to federal programs using an automated software platform. The OIG is also closely monitoring Medicare Advantage (MA) and Medicaid managed care programs. MA, involving private insurers administering plans for seniors, now includes over half of the eligible Medicare beneficiaries. Similarly, managed care in Medicaid, the dominant payment model in the program, has shown issues with denial of requests for prior authorization and limited options for beneficiaries to appeal these decisions.

High cost of health care making consumers sick – in a literal way

By Alan Goforth - The high cost of health care is taking a toll on the health of Americans. More than half of consumers feel stressed when paying their medical bills, and more than 9 in 10 say the stress of these payments has affected their physical and mental health, a recent study from PayMedix found. Read Full Article…

VBA Article Summary

1. Increased Financial Burden on American Workers: The research reveals a significant increase in healthcare-related financial challenges for American employees with employer-provided insurance. This is primarily due to the shift towards high-deductible plans, leading to higher out-of-pocket expenses. This trend not only intensifies the medical debt crisis but also discourages many from seeking necessary healthcare, further disengaging them from the healthcare system.

2. Diverse Impact on Different Demographics: The affordability of medical bills varies significantly among Americans, especially for those with lower credit scores. About 44% of people with a credit score below 669 find their deductibles unaffordable. The financial strain of high medical bills compels many to use their savings or delay payments. Additionally, the report highlights a considerable amount of confusion over billing, with employees receiving numerous bills and statements, many of which are difficult to understand. This confusion is exacerbating the stress and dissatisfaction with healthcare services, particularly among younger generations, people of color, and those with poor credit scores.

3. Role of Employers in Mitigating Healthcare Stress: The report emphasizes the crucial role employers play in addressing healthcare-related stress and confusion among employees. While 60% of employees believe their employers should provide financial strategies to manage health insurance better, less than 20% report that their employers offer such support. Most employees desire a simplified billing solution, with flexible payment options and guaranteed credit for out-of-pocket maximums. The report also notes the challenge in improving health equity, as underprivileged populations, even when insured, struggle to access financial credit, limiting their ability to fully utilize their insurance.

Rising Cost of New Medications, Will the People Who Need Them Most be able to Afford them?

By Shane Reeves - Americans can’t afford their medications. About 25% leave prescriptions unfilled, split pills, or skip doses. Seniors face challenges covering non-Medicare services, including prescriptions. Even those with commercial health insurance are not immune. One-third of insured adults worry about affording their premiums, and 44% must meet increasingly high deductibles before insurance even kicks in. As a result, 41% of adults carry substantial medical debt. Read Full Article…

VBA Article Summary

1. Rising Approvals and Costs of Rare Disease Therapeutics: The FDA has seen an increase in approvals for treatments targeting rare diseases, including cancer and Alzheimer’s, with 54% of the novel drugs approved in 2022 for rare diseases. These include treatments for conditions like acid sphingomyelinase deficiency, prurigo nodularis, and obstructive hypertrophic cardiomyopathy. However, these groundbreaking therapies come with high costs. For instance, Hemgenix for hemophilia is now the world's most expensive drug at $3.5 million annually, followed by other costly treatments like Zynteglo and Zokinvy. Similarly, prices for medications treating more common conditions, such as multiple sclerosis and rheumatoid arthritis, have also surged significantly.

2. Ambulatory Infusion Centers: Access and Cost Benefits: To tackle financial and accessibility challenges, the growth of ambulatory infusion centers has been notable. These centers, more geographically accessible than hospitals, offer close monitoring of patients, leading to improved adherence rates for complex treatments. They also present significant cost savings, potentially reducing specialty medication administration expenses by up to 50%, thereby offering a more cost-effective solution for patients with rare and chronic conditions. These centers are instrumental in providing access to lifesaving medications and are increasingly integrating software solutions to enhance financial navigation for patients, further improving affordability and treatment adherence.

3. The Need for Patient-Centric Healthcare Models: The development of new medications for rare diseases is costly and time-intensive, highlighting the need for a healthcare model that prioritizes patient convenience, support, and financial assistance. Traditional healthcare systems have often been more provider-centric, treating patients uniformly regardless of their specific conditions. There is a growing recognition of the importance of making healthcare access, support, and financial assistance key priorities to improve compliance and outcomes, particularly for patients with rare, complex, and chronic conditions. This shift towards a more patient-centered approach is essential for better disease management and overall healthcare experience.

Blue Shield of California discloses data breach, number of members impacted unclear

By Paige Minemyer - Data on Blue Shield of California members may have been exposed due to a vulnerability in the MOVEit file transfer platform. Read Full Article…

VBA Article Summary

1. Data Breach Notification and Timeline: On September 1, an insurer was informed by a vendor about a data breach. The vendor discovered on August 23 that an unauthorized user had accessed information on the MOVEit server, which led to the server being taken offline. It was later found that on May 28 and May 31, data was extracted from the server. The insurer posted a notice about this incident last month.

2. Impact and Information Accessed: The exact number of affected members remains undisclosed, but the breached data may include sensitive information such as names, birth dates, addresses, Social Security numbers, group and patient ID numbers, along with vision care diagnoses and treatment details. Blue Shield confirmed that there was no evidence of its systems or emails being compromised in the breach.

3. Response and Measures Taken: Impacted members are being offered no-cost credit monitoring and identity restoration services by Blue Shield, highlighting their commitment to privacy protection. Following the breach, the vendor reconstructed the MOVEit server to meet enhanced security standards and thoroughly checked the new protocols before restoring it. Additionally, data from the Centers for Medicare & Medicaid Services and Oregon Health Plan was exposed due to a vulnerability in the MOVEit platform identified in May.

3 Trends Employers Should Watch Out for in 2024

By Marissa Plescia - There are several challenges and trends employers should keep tabs on in 2024, with rising healthcare costs topping the list, according to a report the Business Group on Health released. Read Full Article…

VBA Article Summary

1. Rising Healthcare Costs: In 2024, healthcare costs are expected to continue increasing due to various factors like inflation, provider shortages, escalating mental health challenges, and delayed preventive screenings leading to more expensive health conditions. Cost drivers also include high-priced cell and gene therapies and GLP-1s. Ellen Kelsay, president and CEO of Business Group on Health, notes the heightened concern over these issues. Employers are responding by shifting from fee-for-service models to value-based care, leveraging centers of excellence, and re-evaluating their PBM contracts.

2. Focus on Specific Mental Health Issues: Mental health remains a priority for employers, with growing emphasis on specific areas such as youth and adolescent mental health, substance use disorder, and suicide prevention. Kelsay highlights the challenges presented by the current fragmented approach to mental health services, emphasizing the need for integration to improve patient experience and accessibility.

3. Addressing Cancer and Other Serious Conditions: Cancer, primarily due to delayed screenings during the Covid-19 pandemic, has become the top cost driver for employers. Other concerns include diabetes, cardiac health, and musculoskeletal conditions. The Business Group on Health suggests that employers will adopt a "back to basics" approach, focusing on prevention and primary care to detect conditions early. Additionally, employers are considering more personalized care options like biomarker screenings and pre-treatment genetic testing.

The weight loss market looks unstoppable. How high could it go?

By Kelly Bilodeau - How much will people pay to slim down? Experts believe the obesity challenge may affect more than half of the global population over age five by 2035. Analysts ratcheted up growth estimates for the global anti-obesity market throughout the year, floating numbers as high as $77 billion to $100 billion or even $200 billion by 2030, based on the increasing popularity of glucagon-like peptide-1 (GLP-1) agonists, originally designed to treat diabetes, but now approved for weight loss. Read Full Article…

VBA Article Summary

1. Medicare Coverage and Patient Commitment: The success of new weight loss drugs like Saxenda, Wegovy, and Zepbound hinges on critical factors such as Medicare's decision to cover these medications and the willingness of individuals to stay on these treatments despite potential side effects. Their popularity and potential impact are underscored by significant interest from the American public, as evidenced by a recent poll indicating nearly half of Americans would try a weight loss drug.

2. Economic Impact and Insurance Challenges: These drugs, while showing promise in combating obesity, face significant economic barriers. High costs, often not covered by Medicare or private insurance, limit accessibility for many. The debate over whether these drugs are essential treatments or vanity projects continues, with trials like semaglutide showing potential health benefits. However, the cost-effectiveness of long-term usage and concerns over relatively modest absolute health benefits remain significant issues.

3. Competition and Side Effects in the Market: The weight loss drug market is rapidly evolving, with companies exploring new drug categories such as myostatin inhibitors to address concerns like lean tissue loss associated with current GLP-1 drugs. The competition is intensifying, with companies like Eli Lilly acquiring potential competitors to consolidate their position. However, the side effects of current drugs, including nausea, diarrhea, and severe conditions like thyroid cancer and gastroparesis, pose substantial challenges to patient adherence and the overall success of these treatments.

West Monroe: 64% of Health Insurer Execs Say Digital Transformation is a Top Priority

By Marissa Plescia - ​About 64% of health insurer C-suite executives say that digital transformation is a top priority, while 35% say it’s a “medium” priority, new data from West Monroe shows. Yet, there are some challenges to implementing digital initiatives. Read Full Article…

VBA Article Summary

1. Digital Transformation Challenges: West Monroe's report highlights a significant gap between the intent and reality of digital transformation among health insurer executives. Despite 92% of them acknowledging digital transformation as a top priority, only 8% believe their staff fully embrace it. The primary obstacles they face include competing priorities (36%), poor data quality (35%), uncertainty due to economic volatility (34%), and isolated teams and data (34%).

2. Long-Term Commitment vs Short-Term Planning: Beth Mosier, from West Monroe’s Healthcare & Life Sciences practice, emphasizes the difficulty in committing to digital transformation initiatives. These initiatives require long-term investment and have uncertain value returns, making it challenging for companies, especially health insurers with tight margins, to allocate funds when their budgets are typically short-term and annual.

3. AI Implementation in the Health Insurance Sector: The survey also delves into the adoption of AI in the health insurance industry, identifying finance (48%), customer success (41%), and HR (41%) as key areas for piloting AI projects. AI's potential benefits range from automating revenue tracking in finance to enhancing customer experience in understanding complex insurance details. However, transitioning to AI-driven processes raises concerns about job changes, skills requirements, and inherent risks, especially in a sector traditionally averse to risk. Mosier points out the need for significant change management, including upskilling and cross-skilling, to adapt to AI-enabled processes.

Moody's: 2023 outlook remains stable for payers despite higher MA utilization, Medicaid redeterminations

By Paige Minemyer - ​The financial outlook for major health plans is stable in the face of notable potential headwinds heading into the end of the year, according to a new report from Moody's Investors Service. Read Full Article…

VBA Article Summary

1. Third Quarter Earnings and Medicare Advantage Utilization Trends: The Moody's analysis highlighted that the earnings for the third quarter were consistent with the second quarter, affirming the industry's stability. A key trend identified was the increased utilization in Medicare Advantage (MA), especially in outpatient care, which peaked in the second quarter but stabilized without improvement in the third quarter. Centene was an exception, reporting a lower medical loss ratio for MA in the third quarter of 2023 compared to the same period in the previous year.

2. Medicaid Unwinding Process and Its Impact: The report discussed the ongoing Medicaid unwinding process, which started in April and has led to over 10 million people losing coverage, predominantly due to procedural issues. The Moody's analysts expect most of these individuals to regain coverage through the individual market or employer-based insurance. This process is contributing to a reduced earnings growth rate for health insurers, but it is just one of several factors influencing this trend.

3. Emerging Trends and MA Star Ratings: The report also touches on the rising costs associated with GLP-1 drugs, used for diabetes and weight loss, and the implications for health insurers and their corporate clients. Furthermore, changes in the calculation of MA star ratings are having significant impacts on payers. For example, Aetna saw an increase in members enrolled in plans with four or more stars, while Elevance Health and Centene experienced declines in their star ratings.