PhRMA keeps pummeling PBMs, launching fresh attack on power over pharmacy choice

By Nick Paul Taylor - PhRMA has rounded up its attack ad team once again for another broadside against pharmacy benefit managers, zeroing in this time on the potential for insurers to profit from where prescriptions get filled. Read Full Article…

VBA Article Summary

1. Continuation of a Critical Ad Campaign: PhRMA has once again launched a critical advertisement campaign targeting the PBMs (Pharmacy Benefit Managers), aligning with its previous efforts in 2019 and 2021 to address criticisms about drug pricing. This initiative comes amidst recent contentious drug pricing legislation passed by Congress. The latest TV spot, entitled “Middlemen Are Everywhere,” portrays a negative image of PBMs as intervening middlemen who benefit financially by directing patients to certain pharmacies, causing discomfort and confusion among patients.

2. Personal Narratives to Strengthen the Message: Accompanying the TV spot, PhRMA has also released a two-minute video narrating a personal ordeal of a family who was directed by a PBM to change their long-trusted pharmacy, which led to delays and difficulties in procuring a necessary medication for their son. This narrative seeks to resonate with audiences by showcasing the real-life implications of PBMs' interventions, highlighting the bureaucracy and additional stress placed on individuals and families in need of essential medications.

3. Lobbying for PBM Industry Reforms: These recent critical advertisements form part of PhRMA's larger efforts to lobby for legislative reforms targeting the PBM industry. In recent years, a diverse group of stakeholders, including pharmacies, drugmakers, and employer groups, have joined forces to criticize and scrutinize the operations of PBMs, pushing for legal measures at both state and national levels to regulate the industry more effectively and ensure that patients' access to necessary medications is not compromised for profits.

Nationwide telehealth use held steady in June

By Brian T. Horowitz - Telehealth visits have dropped since reaching historic highs during the COVID-19 pandemic, when virtual visits grew by more than 7,000% from 2020 compared to 2019, spurred in part by federal telehealth flexibilities. Although use has dropped since 2020, telehealth care has remained popular, and federal lawmakers face a 2024 deadline to make COVID telehealth flexibilities permanent. Read Full Article…

VBA Article Summary

1. Legislation to Enhance Telehealth Access: In June, a bipartisan effort saw 60 senators reintroduce the CONNECT for Health Act. This bill aims to improve access to telehealth services by permanently removing geographic restrictions, allowing patients to utilize services from their homes, and enabling health centers, especially in rural areas, to offer telehealth. Notably, the bill is also advocating for a reduced in-person requirement, spanning six months, for telemental healthcare services.

2. Insights on Telehealth Usage: Recent data from the Fair Health’s Monthly Telehealth Regional Tracker indicated that telehealth sessions constituted 5.4% of claim lines in June, consistent with the previous month's figures. Mental health issues remained the most prevalent diagnosis in these telehealth sessions. Interestingly, while there was a 2.4% overall decline in telehealth usage in the Midwest, asynchronous telehealth claims for mental health conditions surged, jumping from 15.9% in May to 36% in June. Asynchronous telehealth allows providers to analyze patient data or medical imagery outside of real-time sessions.

3. Mixed Reception and Varied Accessibility to Telehealth: Despite the overall growth of telehealth, challenges persist. A JAMA Health Forum study highlighted the positive impact of telehealth on mental health treatments, showing an overall rise in its uptake. However, a Rand study presented in Health Affairs revealed a limitation: many behavioral health patients don’t possess the liberty to choose between in-person or telehealth sessions, as their clinicians often offer just one mode of service. This points to a disparity in the accessibility and choice in telehealth services across various patient groups.

By Amanda Umpierrez - Preliminary results of a Mercer survey find that more employers expect increases in health benefit costs for 2024. The earliest findings from the 2023 National Survey of Employer-Sponsored Health Plans shows that plan sponsors anticipate total health benefit costs per employee to rise an average of 5.4% in 2024, up from former averages of 3% to 4%. Read Full Article…

VBA Article Summary

1. Increasing Health Benefit Costs Amid 2023's High Inflation: Mercer experts identify several factors as the causes of the escalating health benefit costs in 2023, including soaring inflation and labor shortages within the healthcare industry. Other contributors are consolidated health systems and the high pricing of healthcare services, as noted by Sunit Patel, Mercer’s chief actuary for Health and Benefits. As businesses try to curb the mounting expenses, research indicates a forecasted rise of 5.4% in health benefit costs, a figure that represents the strategies employers intend to employ to maintain the cost. Without any adjustments, the increase could reach an average of 6.6%.

2. Reluctance to Shift Costs to Employees: Despite the growing financial burden, the survey shows a significant hesitancy among employers to transfer these extra costs onto their employees. Many are choosing to absorb these increases rather than demanding higher out-of-pocket contributions from their workforce. This decision, while safeguarding employees from escalating healthcare costs, is also fostering quicker growth in health plan costs, especially among large employers.

3. Future Strategies Focus on Healthcare Affordability: Looking towards the future, Mercer highlights that 68% of large employers find strategies to enhance healthcare affordability crucial in the coming years. Furthermore, the data suggests that in 2024, there is no plan among employers to heighten the share of cost coverage for employees. It is expected to maintain at an average of 22% of the total health plan premium costs being covered by employees through paycheck deductions, consistent with the rates from 2022 and 2023. This approach hints at a continuing trend where employers aim to alleviate the financial pressure on their employees amidst a volatile healthcare market, a sentiment echoed by Patel especially regarding the cautious stance of insurance carriers going into the next year.

Prisma Health sues UnitedHealthcare, alleging insurer broke its contract

By Alan Goforth - Prisma Health, a South-Carolina-based health system, alleges in a lawsuit filed Aug. 23 that UnitedHealthcare breached the parties’ confidentiality agreement and provided inaccurate statements to the media about Prisma’s proposed rates for 2024. The suit claims that UnitedHealthcare undermined good-faith negotiations by issuing multiple statements to the media without providing advance notice to Prisma. Read Full Article…

VBA Article Summary

1. Ongoing Negotiations and Accusations: Prisma has filed a lawsuit against UnitedHealthcare, seeking a temporary restraining order to prevent the latter from disclosing any more proprietary business information. Prisma accused United of issuing “false and misleading” statements to gain an upper hand in the negotiations. United has countered that Prisma is demanding an unreasonable rate hike, which will significantly impact health care costs in South Carolina.

2. Potential Consequences for Healthcare Accessibility in South Carolina: The current contract, established in 2021, between Prisma and United is set to expire by the end of December. If no agreement is reached, starting January 1, 2024, Prisma Health may no longer be a part of United's in-network provider list, potentially affecting thousands of South Carolinians. Prisma has urged United to acknowledge the increased healthcare costs since their last agreement in 2021, negating the claim of a universal 24% hike in reimbursement rates.

3. Widening Rifts Between Health Systems and Insurers: The conflict between Prisma and United is a reflection of a growing trend of strained relationships between healthcare systems and insurers. Other recent instances include the lawsuit between Bon Secours and Anthem Blue Cross Blue Shield, highlighting the increasing disputes over contract negotiations and payment claims. These cases underscore the urgent need for collaborative negotiations to avoid disruptions in healthcare accessibility and affordability.

Are Flashy Perks a Thing of the Past?

By Lin Greensing-Pophal - ​When Linda Lee joined Velocity Global, a Denver-based HR tech platform company, as chief people and culture officer earlier this year, one of the first things she noticed was that the company emphasized "shiny" visible perks—such as meditation apps—but the utilization of those perks was low. Read Full Article…

VBA Article Summary

1. Shifting Focus from Flashy Perks to Fundamental Benefits: Companies are increasingly recognizing that superficial perks, such as free meals or pingpong tables, are not the main drivers for employee retention and satisfaction. In light of changing work dynamics, largely influenced by the COVID-19 pandemic and the transition to remote work, companies like Velocity Global and SailPoint are shifting their focus towards enhancing core benefits. This includes measures such as reducing health insurance premiums, offering matching 401(k) plans, and fostering opportunities for career growth and performance-based rewards. These fundamental benefits are aimed at fostering a sense of belonging and value among employees, as opposed to temporary satisfaction derived from flashy perks.

2. Ensuring Equity and Personalization in Benefits Packages: The contemporary workforce seeks benefits that are both equitable and customizable to their unique needs. Companies like UKG have listened to employee feedback and revamped their benefits packages to offer greater choice and fairness. UKG's U Choose program, for instance, allows employees to allocate a quarterly reimbursement towards a variety of life necessities, ensuring that benefits are accessible and applicable to employees at different stages of their lives. This approach promotes a sense of empowerment and appreciation, as employees can personalize benefits to suit their individual circumstances.

3. Strategic Communication and Employee Engagement in Benefit Revamps: As companies undergo significant changes in their benefits structures, strategic communication becomes a pivotal component to ensure successful implementation. The leaders are employing multi-faceted approaches to communicate these changes, involving both top-down and bottom-up strategies. A case in point is Velocity Global's meticulous rollout of their revamped benefits plan, which involved forming a culture committee comprising well-respected employees, empowering people managers with the necessary information to address concerns, and maintaining an open line of communication through platforms like Slack. Such strategies facilitate a transparent and inclusive conversation, helping to address employee concerns and garner support for the changes. Ultimately, the focus is on affirming the value and opinions of employees, fostering a stronger sense of community and belonging in the organization.

A ‘dire’ situation: Employees’ mental healthcare needs soar again

By Dawn Kawamoto - Despite the nation’s move toward normalcy and the COVID pandemic’s official end, employees’ mental health needs have skyrocketed over the last year, according to a survey released this week by the Business Group on Health. And these needs, along with the expense of conditions like cancer—the No. 1-ranked driver of healthcare costs, are driving employers’ overall healthcare spend higher by nearly double digits (8.4%), according to the organization’s 2024 Large Employer Health Care Strategy Survey. Read Full Article…

VBA Article Summary

1. Significant Rise in Employees' Mental Health Needs: A notable increase in the mental health needs of employees has been observed, with 77% of employers acknowledging this rise, a significant jump from the 44% recorded last year. This growing trend indicates a critical need for enhanced mental health services and support systems within organizations. To address this, 36% of employers are prioritizing the expansion of mental health services in their 2024 healthcare initiatives, utilizing online resources such as apps, webinars, and articles as primary tools. Furthermore, employers are actively working to expand their mental health networks and have initiated training programs to help employees identify mental health issues among their peers and guide them to appropriate resources.

2. Growth in Mental Health Navigation and Peer Support Training: Employers are progressively adopting comprehensive strategies to bolster mental health support in the workplace. This includes an expected increase in the offering of mental health navigation programs from 31% to 44% by next year. Moreover, training aimed at equipping employees to recognize and respond to mental health issues among peers is gaining traction, with 44% of employers currently implementing such training initiatives and an anticipated increase to 52% in the next year. This approach leverages peer support and emphasizes collaborative efforts in addressing mental health concerns within the workforce.

3. Escalating Healthcare Costs and Focus on Preventative Care: Amid the escalating healthcare costs, where the average cost rose by 8.4% to $17,201 per employee this year, employers are bearing the brunt of the increase, contributing 68.4% of the total premium cost. This effort is aimed at safeguarding employees from affordability issues. However, the sustainability of this approach remains uncertain. Alongside this, employers are contending with increasing health conditions like cancer and musculoskeletal problems which are the primary drivers of healthcare costs. The trend of late-stage cancer diagnoses, exacerbated by pandemic-induced screening delays, is a growing concern, with employers focusing on providing or covering screenings that exceed typical preventative care measures to mitigate future implications.

Self-funding strategies vs. ICHRA as alternatives to traditional health insurance

By Tom Mafale - The trend is clear: In recent years, self-funding has been steadily gaining popularity among companies of all sizes as an alternative to fully insured group health plans. As of 2023, 65% of employees were covered by a self-funded plan, compared to 44% in 1999. While self-funding was once embraced as a viable option only for larger corporations due to the substantial number of covered lives required for stability, rising costs and changes in regulations have made it more feasible than ever for smaller companies to go the self-funded route as well. Read Full Article… 

VBA Article Summary

1. Rising Costs and Administrative Challenges of Self-Funding: Companies opting for self-funding have to contend with skyrocketing stop-loss insurance premiums, with an average increase of nearly 10% observed in 2022. Additionally, administrative service only (ASO) fees and stop-loss premiums have a maturity factor that can lead to unforeseen and unbudgeted cost increments in subsequent years. Many organizations are unbundling their healthcare services, adding to the administrative burden, especially for human resources teams. Employers tweaking their plans to adhere to ASO guidelines might find themselves in a complex situation, where they are deviating from state-mandated benefits, causing confusion among employees and potentially leading to adjusted fees from carriers/TPAs.

2. The Complexities of Tailoring Self-Funded Plans: Self-funding allows employers to tailor their health care plans but can lead to complications when deviating from state-mandated benefits. This customization might result in employee confusion and complications, particularly if the employer makes claim exceptions or modifies benefits, which can also potentially lead to adjusted fees by carriers or TPAs.

3. The Individual Coverage Health Reimbursement Arrangement (ICHRA) as a Promising Alternative: ICHRAs are emerging as a viable alternative to self-funding, eliminating claims risk and simplifying administration by shifting the financial responsibility of large claims back to the carriers' state risk pools. ICHRAs provide a more predictable financial landscape for companies by separating employees' health expenses from the company’s financial overview, avoiding the need to constantly renegotiate terms and evaluate claims experiences. The introduction of ICHRAs signifies a potential shift in the healthcare landscape, offering a structured way to contribute towards employees' individual health insurance premiums and qualified medical expenses, fostering a more streamlined approach to healthcare benefit offerings in the coming years.