Benefit Design

An ongoing lawsuit over the use of copay accumulators is drawing to a close following the defendants’ and plaintiffs’ motions to dismiss their appeals. The ball is now in the federal government’s and state insurance commissioners’ courts to enforce a district court judge’s ruling, which states that manufacturer assistance must be counted toward patients’ out-of-pocket responsibility unless a brand-name drug has a medically appropriate generic equivalent.

Health plans and PBMs several years ago began implementing copay accumulators — and then a new iteration known as copay maximizers that declare certain drugs non-essential health benefits to avoid covering them per the Affordable Care Act (ACA) — to counter manufacturer copay assistance programs. Before these tools, that assistance would count toward beneficiaries’ annual out-of-pocket expenses. When those out-of-pocket maximums were reached, health plans would cover the remainder of members’ costs for the year. With accumulators and maximizers, patients can still use that assistance, but it does not help reduce those out-of-pocket costs.

While pharma manufacturers for the most part are still adhering to their traditional business model, other entities in the drug channel are reorganizing, which will prompt drugmakers to be nimble as they adjust to the new reality. That’s one of the overarching themes moving into 2024 discussed during a recent webinar hosted by Adam J. Fein, Ph.D., CEO of Drug Channels Institute, which was recently acquired by HMP Global. In this second of a two-part series, AIS Health highlights the remaining industry trends projected by the longtime industry expert.

It’s hard to underestimate the reach of artificial intelligence (AI) across the health care and pharmaceutical industries. While the ultimate impact of the technology on payers and providers may be debatable, pharma companies have made broader inroads into exploring ways to enhance their efforts, including in drug discovery. Still, caution in some areas is warranted, according to some studies.

For the Managed Care Biologics & Injectables Index: Q3 2023, from Aug. 13, 2023, to Sept. 29, 2023, Zitter Insights polled 35 commercial payers covering 117.7 million lives, 103 physicians and 83 practice managers about their familiarity with Open AI’s ChatGPT and AI tools in general.

Health insurer trade groups have several bones to pick with the proposed 2025 Notice of Benefit and Payment Parameters (NBPP), the annual regulation that sets the rules of the road for the Affordable Care Act exchanges. In the case of certain proposals, AHIP and the Blue Cross Blue Shield Association (BCBSA) are even arguing that CMS is exceeding its legal authority.

Those proposed rule changes concern the process that states use to define their essential health benefits (EHB) benchmark plans, according to comments on the 2025 NBPP filed on or before a Jan. 8 deadline. The ACA lists 10 general categories of EHB that all individual market plans must cover — such as emergency services and prescription drugs — allowing states to determine the specific services that are included in those broad categories. To do that, state officials select a benchmark plan among a list of HHS-approved options, and insurers then use that benchmark to design their benefits.

Tremendous strides have been made in personalized medicine over the past several years — not only in drugs but in the various biomarkers used to identify the right drug for the right patient at the right time. While many people may think of this approach as one mainly solely for cancer, the potential for personalized medicine to have a broader impact on health outcomes when it is used proactively has not fully been realized.

In September, InformedDNA — which provides genomic solutions to an array of health care stakeholders to improve outcomes — acquired gWell Health, a digital health, genomics and wellness company. As part of the deal, gWell founder and CEO Surya Singh, M.D., transitioned to CEO of InformedDNA. Singh has worked in various health care organizations in more than 20 years, including serving as corporate vice president and chief medical officer at CVS Health Specialty.

A district court judge wasted no time in responding to the latest motion in an ongoing lawsuit filed against HHS by patient advocacy groups over the use of copay accumulators. In his decision, the judge reiterated his September decision vacating one rule and reinstating another that prohibits the use of accumulators for drugs that do not have a medically appropriate generic equivalent. It’s not entirely clear what next steps will be, but one patient advocacy group says it hopes to see HHS enforce the policy limiting plans’ use of accumulator programs.

While pharma manufacturers began offering the programs to help patients stay on costly therapies, payers have pushed back, saying they lead to higher-cost agents to be used over lower-cost ones. At the same time, similar programs, such as copay maximizers and alternate funding programs, have increased in use, to payers’ dismay.

Entering 2024, growing health care costs are the main worry of employer plan sponsors, according to industry experts. To cope with the problem, those experts add, employers may seek novel benefit designs, while also reaching for tried-and-true cost control methodologies like narrower networks.

Brokerage WTW found in a September survey that 69% of surveyed large employers listed health care costs as a “top health and wellbeing priority” over the next three years, and that health care costs were the most frequently named priority by respondents.

“I think that the emphasis on cost is actually bigger now than it was a few years ago,” says Jeff Levin-Scherz, M.D., population health lead at WTW and an assistant professor at the Harvard School of Public Health.

While the U.S. finally had biosimilar competition for AbbVie Inc.’s Humira (adalimumab) in 2023, it may take longer than anticipated for the agents to truly have an impact. That’s one of the trends moving into 2024 that Adam J. Fein, Ph.D., CEO of Drug Channels Institute, discussed during a recent webinar. While the impact of the glucagon-like peptide 1s (GLP1s) and patient-paid prescriptions will persist, the uptake of copay offset tools is subsiding, he said during the Dec. 15 webinar, titled Drug Channels Outlook 2024. In this first of a two-part series, AIS Health highlights the first half of the trends projected by the longtime industry expert.

From Star Ratings and risk model changes to a significant overhaul of the Medicare Part D benefit that will take effect over the next few years, Medicare Advantage insurers this year must anticipate the potential impact of major changes and ensure their products and services continue to satisfy members. Investment priorities highlighted by three influential MA carriers include digital solutions, member engagement strategies and value-based care.

Humana Inc., for one, took a “thoughtful approach to bids to ensure we were meeting members’ needs while balancing the rate environment,” says George Renaudin, president and Medicare and Medicaid. That included maintaining or enhancing key benefits that were identified by consumers and brokers as most critical to members, such as $0 premiums, dental and Part B “givebacks.”

Almost two months after a U.S. district court judge struck down a federal rule allowing health plans to not count copayment assistance against members’ out-of-pocket costs, ruling in favor of patient advocacy groups in a lawsuit against HHS, the agency has signaled that it will not — at least for the time being — take action against plans based on how they treat that assistance. The agency in a recent court filing also said it plans to issue rulemaking in response to the September ruling and requested feedback from the judge on his decision. Shortly thereafter, the plaintiffs appealed the government’s move.

To help patients pay for pricy therapies — usually specialty drugs — pharmaceutical manufacturers offer assistance that can help cover their out-of-pocket costs. Companies claim that the assistance helps improve patient adherence to medications that often treat rare and deadly conditions. But critics of them say such programs incentivize drugmakers to raise prices of these agents.