Benefit Management

Enforcement Actions Show Mounting CMPs from Financial Audits (with table: CMP Amounts Imposed on Medicare Advantage Insurers From February to April 2022)

Between February and April of this year, CMS imposed a total of nearly $1 million in civil monetary penalties (CMPs) on Medicare Advantage and Part D organizations for program violations uncovered during routine audits, including so-called “one-third financial audits.” While CMS has yet to release its annual report that provides a fuller picture of plan noncompliance, the latest round of CMP notices offers some important lessons for sponsors and flags a few potential areas of risk that they should be monitoring in their own operations, according to compliance experts.

Of the 15 CMP notices recently posted to the CMS Part C and Part D Enforcements Actions webpage, six resulted from 2021 program audits and eight were related to 2020 financial audits. Additionally, CMS imposed a fine on Anthem, Inc. for a Part D appeals violation stemming from a previously detected system migration issue that occurred in 2020.

BCBS of Michigan Launches Precision Medicine Pilot Program

Blue Cross Blue Shield of Michigan last month launched a precision medicine pilot program for 500 of its Medicare Advantage HMO members who also have pharmacy benefits. Experts say the move is becoming more common among payers as they look to reduce their medication spending and improve clinical outcomes in high-risk groups.

The program, Blue Cross Personalized Medicine, is using pharmacogenomics (PGx), or genetic testing, to help identify how people respond to certain medications and offer specific treatment recommendations based on their genetic makeup. Its aim is to help BCBS of Michigan manage high drug costs and give its members tailored, cost-effective and clinically relevant care while also decreasing adverse drug reactions.

CalOptima Aims for Real-Time Payments, Prior Auth Approvals

CalOptima, a Medi-Cal plan in Southern California, launched a five-year blueprint to cut through delays in care approvals and payments, as it seeks to deliver near-immediate claims processing and to put an end to prior authorization-related lags.

On March 21, CalOptima announced a $100 million investment in technology upgrades, which the Medicaid plan seeks to use to reduce barriers to care and to bridge divides — primarily centered on data-sharing — between the plan, providers and community partners.

The payer, which serves nearly 900,000 members in Orange County, also wants to get money into the hands of providers faster, with plans for an innovative “real-time claims processing” system.

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Calif. Fines L.A. Care $55 Million for Prior Auth, Appeals Issues

L.A. Care, the Medicaid-focused health plan owned by Los Angeles County, has been fined $55 million by the state of California for allegedly mishandling prior authorizations and coverage appeals. According to state regulators, L.A. Care — the largest nonprofit Medicaid managed care organization (MCO) in the country — mishandled more than 67,000 grievances filed by plan members, which caused sick patients to be denied proper care or wait months for urgent treatment.

Two California agencies, the Dept. of Managed Health Care (DMHC) and Dept. of Health Care Services (DHCS), launched an investigation into L.A. Care’s prior authorization and denial appeals processes after a September 2020 Los Angeles Times article revealed that extremely ill L.A. Care members faced dangerous delays when they tried to see a specialist. The combined $55 million in fines assessed by the agencies far outstrips the previous record fine in California, $10 million, for similar violations, according to the news outlet.

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Payers Can Play a Role in Encouraging Naloxone Coprescribing

To prevent deaths and injuries related to prescription opioid misuse, research has shown that coprescribing the overdose-treatment drug naloxone when patients on chronic pain-management therapy receive high doses of opioids can make a big difference. Yet federal data show that less than 1% of patients who should be prescribed naloxone with their opioid medications obtain a prescription for it — a rate that managed care entities can play a role in changing, according to a new paper from the Academy of Managed Care Pharmacy (AMCP) Addiction Advisory Group.

The AMCP Addiction Advisory Group in 2019 polled AMCP payer members, addiction treatment providers and managed behavioral health organizations, with the goal of understanding and evaluating “trends in treatment, coverage, policies, and needs associated with providing health services to patients with substance use disorders.” One particularly notable finding was that 80% of the managed behavioral health organizations and 47% of AMCP payer members who responded to the survey encouraged naloxone coprescribing in patients at high risk of overdose, but “no organizations required coprescribing.”

Aetna Could Face Class-Action Suit Over Proton Therapy Denials

Due to a Jan. 27 federal court order, CVS Health Corp.’s Aetna health insurance division could be the defendant in a class-action lawsuit regarding Aetna’s restrictive coverage decisions in breast and prostate cancer treatment. In a lawsuit filed in Florida district court, a federal judge found that Aetna improperly denied coverage of proton therapy to cancer patients who ultimately had to pay for the treatment out of pocket.

Proton beam radiation therapy (PBRT) is a type of cancer treatment “that uses high-powered energy to treat cancer and some noncancerous tumors,” according to the Mayo Clinic, which also notes that “studies have compared proton radiation and X-ray radiation, so it’s not clear whether proton therapy is more effective at prolonging lives.” The therapy isn’t widely available, although new proton therapy centers are being built in the U.S. and in other countries.

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Report Trains Critical Eye on PBMs’ Changing Profit Streams

A new report about PBMs’ “evolving business models and revenue” is making a stir, with the main PBM trade group arguing that the organization behind it is biased and its conclusions are misguided. But industry observers tell AIS Health that the analysis offers illuminating information about how vertical integration and other factors have shaped the PBM sector — and they warn that PBMs must truly change if they are to survive increasing scrutiny.

Express Scripts Will Combine Coupons With Pharmacy Benefit

Express Scripts, the PBM subsidiary of Cigna Corp., will allow members to combine prescription drug coupons with their traditional pharmacy benefits. Pharmacy insiders tell AIS Health that the new offering is likely meant to head off competition from GoodRx Inc. and other upstarts.

A November blog post on the website of Evernorth, the Cigna subsidiary that owns Express Scripts, explains that around 2% of the time, discount pricing “is a little better” than the price offered when customers use their insurance.

Smaller PBMs Beat Big Firms in Customer Satisfaction

Plan sponsors’ overall satisfaction with their PBMs increased from 8.0 on a 1-10 scale in 2020 to 8.2 in 2021, according to Pharmaceutical Strategies Group’s 2021 Pharmacy Benefit Manager Customer Satisfaction Report. Based on surveys completed by 291 plan sponsors who provide pharmacy benefits to their employees, the report found that PBMs with 20 million or fewer members tend to have higher satisfaction ratings than larger PBMs. Average satisfaction was highest for PBMs’ opioid management programs, while gene therapy financial protection programs rated the lowest and only 13% of the respondents used such programs. Among PBMs with more than 20 million members, MedImpact scored the highest overall satisfaction rate (8.5).

FDA Grants Interchangeable Status to Humira Biosimilar, but Certain Factors May Hamper Its, Other Adalimumabs’ Uptake

Less than three months after granting interchangeable status to a biosimilar for the first time, the FDA has approved that status for a second biosimilar, Boehringer Ingelheim Pharmaceuticals, Inc.’s Cyltezo (adalimumab-adbm). It and multiple other biosimilars of AbbVie Inc.’s Humira (adalimumab) are slated to come onto the U.S. market in 2023, but plans should be preparing now for the drugs’ launches, say industry experts. Still, a handful of factors could pose an issue with the agents’ taking market share from the reference product.

On Oct. 15, 2021, the FDA granted interchangeability status to Cyltezo for all of its approved uses. Boehringer Ingelheim’s Phase III VOLTAIRE-X clinical trial found no meaningful clinical differences in pharmacokinetics, efficacy, immunogenicity and safety over multiple switches between Humira and Cyltezo. Per the Biologics Price Competition and Innovation Act (BPCIA) of 2009, the drug will have one year of exclusivity upon launch during which the FDA cannot grant interchangeable status to another Humira biosimilar.