Benefit Management

BCBS of Michigan Becomes Latest Insurer to Reduce Prior Authorizations

Blue Cross Blue Shield of Michigan announced on Sept. 7 that it plans to reduce the use of prior authorization (PA) by 20%, becoming the latest payer to cut its PA requirements. While the moves make care delivery less burdensome for providers and patients, health insurers should also benefit from not relying as much on PA, according to health policy experts who spoke with AIS Health, a division of MMIT.

Michael Lutz, a senior consultant at Avalere Health, says that insurers can lower their administrative burden and focus on services where PAs are essential such as costly or high-volume procedures. He adds that plans announce their PA reductions as a marketing tool, too.


Prime, Magellan Rx Offer Value Plus to Help States Negotiate Value-Based Contracts for CGTs

As more and more high-cost therapies, including cell and gene therapies (CGTs), enter the U.S. market, commercial health plans have multiple tools at their disposal to manage these agents. Medicaid plans, however, are limited in what they can do. But a multistate value-based contracting (VBC) tool offered by Magellan Rx Management and its parent company, Prime Therapeutics LLC, is helping Medicaid programs access CGTs and ensuring that the agents’ costs are linked to patient outcomes.

A new Medicaid Pharmacy Insights report, titled The State of Value-Based Contracting: Reinventing the Current Drug Payment Model in Medicaid, notes that Medicaid is usually the largest expenditure in state budgets. States need to be able to offer costly CGTs while also managing their budgets. But various barriers to offering value-based contracts — including a lack of resources to negotiate them, as well as collect data and measure outcomes — have limited adoption of these agreements.


Researchers Take Closer Look at Virtual Mental Health Care Boom

Now that the COVID-19 public health emergency has ended, the health care system — including insurers — are grappling with how to proceed in the “new normal” amid shifted habits and utilization patterns. To that end, two new studies offer insights into the implications of patients’ growing use of telehealth for mental health care services.

“The COVID-19 pandemic has caused massive amounts of changes in health care delivery, but then also in terms of how individuals are dealing with the pandemic. There’s been extensive research about how anxiety has increased or [how] other mental health disorders have increased,” observes Jonathan Cantor, Ph.D., a policy researcher at RAND Corp. With that in mind, Cantor and his fellow researchers sought to build on a previous study and measure how both telehealth and in-person mental health utilization and spending has changed from 2019 to 2022.


MAOs Should Get Member Feedback, Rethink PA as Post-Acute Outcomes Decline

Medicare Advantage members using post-acute care services are reporting less favorable outcomes than their fee-for-service counterparts, according to a new study published in JAMA Health Forum. Not only are outcomes worse, MA beneficiaries are also using fewer post-acute care services than those enrolled in traditional Medicare (TM), which study authors said could be linked to payers’ tight prior authorization (PA) requirements.

The study authors explained that prior research on this topic, which has generally shown favorable post-acute outcomes in MA, relied largely on administrative data, which can’t capture individual beneficiaries’ perception of quality or health status. That’s why they looked to self-reported data from the National Health and Aging Trends Study, focusing on seniors age 70 and older who lived in community settings (rather than nursing homes). “Examining self-reported patient outcomes is key to ensuring that the MA program adequately meets beneficiaries’ needs, particularly since there is evidence that MA enrollees are treated at lower-quality SNFs [skilled nursing facilities],” authors wrote.


New Therapies Bring New Challenges to Drug Benefit Design

With many new, expensive treatments entering the U.S. market, plan sponsors are facing more challenges when designing their drug benefits packages, according to Pharmaceutical Strategies Group’s 2023 “Trends in Drug Benefit Design Report,” sponsored by Rx Savings Solutions. The report is based on surveys of 180 individuals representing employers, health plans and union/Taft Hartley plans.

In 2023, almost all employers and health plans offered a preferred provider organization (PPO) plan and most offered a high-deductible health plan (HDHP) with a health savings account (HSA). Yet only 43% of respondents agreed or strongly agreed that HDHPs effectively manage overall drug trend. The percentage showed a modest increase compared to 35% in 2022.


News of Wegovy’s Cardiac Benefits Could Make Coverage More Compelling

Demand for Novo Nordisk A/S’s Wegovy (semaglutide) may spike even higher following the Danish pharma giant’s Aug. 8 announcement that the diabetes drug, recently approved by the FDA for use as a weight loss treatment, “reduces the risk of major adverse cardiovascular events by 20%” in patients with obesity. Clinicians and pharmacists say the drug’s broad appeal became even greater with the news but suggest that insurers and plan sponsors are likely to continue to erect access barriers to Wegovy given its high cost and clinical limitations.

Novo said a double-blinded trial “compared subcutaneous once-weekly semaglutide 2.4 mg with placebo as an adjunct to standard of care for prevention of major adverse cardiovascular events (MACEs) over a period of up to five years,” and “achieved its primary objective by demonstrating a statistically significant and superior reduction in MACE of 20% for people treated with semaglutide 2.4 mg compared to placebo.”


Medicaid MCOs Often Deny Prior Authorization Requests, OIG Report Says

Medicaid managed care organizations denied one out of every eight prior authorization requests in 2019, according to a recent report by the HHS Office of Inspector General. Among the 115 MCOs reviewed, 12 MCOs that covered about 2.7 million enrollees had denial rates higher than 25%.

The report studied seven MCO parent companies with the greatest number of Medicaid enrollees across 37 states. Molina Healthcare, Inc. had the highest overall prior authorization denial rate at 17.7%, with seven of its 12 MCOs seeing denial rates greater than 25%.


Federal Watchdog: Medicaid Prior Authorization Denials Are Too Common

Medicaid managed care beneficiaries face “high rates of prior authorization denials” and “limited state oversight” of prior authorization, according to a notable new report from the HHS Office of Inspector General (OIG). Medicaid experts who reviewed the report say it demonstrates that Medicaid members and safety net providers may not be able to appeal denials for administrative reasons, and they add that states must do more to facilitate appeals to and prevent inappropriate denials by contracted plans.

The OIG found, in a review of 2019 claims data from seven multistate carriers, that the studied MCOs “fully or partially denied approximately 2.2 million requests for the prior authorization of services,” amounting to one out of every eight requests, or 12.5% of all prior authorization requests. That rate was more than double the Medicare Advantage prior authorization denial rate of 5.7% in 2019, according to the OIG report published July 17.


Optum Rx ‘Pipeline’ Report Takes Closer Look at Three Large-Population Drugs

In its latest drug pipeline insights report, Optum Rx pivots from its habit of highlighting upcoming medications for rare diseases, instead focusing on a trio of emerging therapies that target much wider patient populations. The UnitedHealth Group-owned PBM tells AIS Health, a division of MMIT, that the move was driven more by happenstance than intention.

“In this report, we were focusing on drugs expected in the third quarter of 2023, and from among that group, these three seemed particularly interesting to describe in more detail,” explains Bill Dreitlein, senior director of pipeline and drug surveillance at Optum Rx.


Capital Blue Cross, Other Payers Are Looking to Lower Costs Related to Diabetes

Since implementing diabetes-related programs in 2021, Capital Blue Cross said it has saved its members and their employers nearly $6 million in health care costs. Meanwhile, Humana Inc. has launched a diabetes self-management education and support (DSMES) program through its CenterWell Home Health subsidiary that has seen an uptick in usage among health plans. The initiatives are part of a growing trend among payers that recognize the health burden and huge costs associated with diabetes.

Kelly Brennan, Capital Blue Cross’s senior director of Health Promotion and Wellness, tells AIS Health that the insurer’s beneficiaries with diabetes often have other chronic conditions, “which can be expensive to manage, both for our members and for business leaders who rely upon us to provide strategic solutions that curb health care spending and ensure their employees can be their healthiest.”