Benefit Management

A KFF report released on Nov. 8 found that 3,959 Medicare Advantage plans are available for individual enrollment next year, the second-largest number of plans since 2010 and a 1% decrease from this year. Meanwhile, the average beneficiary will be able to choose from 43 plans, the same as this year's record high. Eighty-nine percent of MA plans will offer prescription drug coverage in 2024; while 83% will offer telehealth benefits; and at least 97% will offer some dental, vision, fitness or hearing benefits.

A group of 32 Reps. led by Jerrold Nadler (D-NY) and Judy Chu (D-CA) sent a letter on Nov. 3 to CMS Administrator Chiquita Brooks-LaSure requesting increased oversight of artificial intelligence tools (AI) used to guide coverage decisions for Medicare Advantage plans. The elected officials wrote that “in recent years, problems posed by prior authorization have been exacerbated by MA plans’ increasing use of AI or algorithmic software managed by firms such as NaviHealth, myNexus, and CareCentrix to assist in their coverage determinations in certain care settings.” They asked CMS to require MA plans to report prior authorization data, compare guidance generated by AI tools with actual coverage decisions and assess whether plans are inappropriately using AI tools.

In its annual assessment of whether prescription drug formularies overly restrict access to select medications, the Institute for Clinical and Economic Review (ICER) gave insurers high marks. While it acknowledges that coverage policy information needs to be much more transparent, this year’s report concludes that “major payer coverage policies for 18 drugs often met fair access criteria for cost sharing, clinical eligibility, step therapy, and provider restrictions.”

However, ICER President-Elect Sarah Emond says the nonprofit research institute is fully aware that its analysis can only do so much to examine all the myriad, complicated facets of what truly defines “fair access.” Therefore, she adds, ICER is actively working on how to make future reports more comprehensive.

A recent survey from WTW found 38% of employer-sponsored health plans provide coverage for anti-obesity medications, while another 22% are planning on or considering covering those drugs in 2024 or 2025. Meanwhile, about two-thirds of employers that are members of WTW’s Rx Collaborative cover anti-obesity drugs, according to Cody Midlam, a director in the company’s Pharmacy Community group.

Midlam tells AIS Health, a division of MMIT, that “we’re definitely seeing the trend is leaning towards adding coverage” of the medications, which are expected to be costly for plans in the coming years. Morgan Stanley, for instance, projected in a September report that the global market for weight management medications could reach $77 billion in 2030, up from just $2.4 billion last year.

Since the FDA approved the first biosimilar — Zarxio (filgrastim-sndz) from Sandoz, then a division of Novartis Pharmaceuticals Corp. — on March 6, 2015, the agency has approved more than 40 additional agents via the 351(k) pathway established under the Biologics Price Competition and Innovation Act (BPCIA), itself part of the Affordable Care Act (ACA). This past year has been especially busy in the space, with highlights including the launch of nine biosimilars of AbbVie Inc.’s Humira (adalimumab) and approvals of the first biosimilars of three different biologics: Biogen’s Tysabri (natalizumab), Actemra (tocilizumab) from Genentech USA, Inc., a member of the Roche Group and Stelara (ustekinumab) from the Janssen Pharmaceutical Companies of Johnson & Johnson. As the FDA approves more biosimilars, uptake of these agents will continue to increase, say industry experts.

As the PBM and specialty pharmacy worlds have become more integrated, PBMs now are providing more specialty management services than they previously did. Only 15% of respondents to a recent survey said they carve out specialty drugs from the PBM that is providing their pharmacy benefit management, while 26% said they were considering taking this step, according to the 2023 Pharmacy Benefit Manager Customer Satisfaction Report from Pharmaceutical Strategies Group (PSG), an EPIC company.

The 85% of respondents whose PBMs provide both specialty and traditional pharmacy benefit management ranked formulary management of specialty drugs and financial reporting in the pharmacy benefit as the services they were most satisfied with, while they were least satisfied with management of specialty agents in the medical benefit and offering competitive discounts on specialty medications.

While a lot of the attention around the Inflation Reduction Act (IRA) has focused on its implications for pharma manufacturers and Medicare Part D plans, much of its focus is on patients and making sure they can access the prescription medications they need at a price they can afford. While aspects such as the out-of-pocket cap for Medicare beneficiaries and the limit on premium increases for plans are welcome developments, some uncertainties still exist around the actual implementation of the law and how patients may be affected. On Oct. 19, life sciences consulting firm Innopiphany, LLC brought together three speakers from patient-advocacy groups to discuss their hopes, concerns and what they have experienced so far.

Fewer Medicare Advantage plans are using Special Supplemental Benefits for the Chronically Ill (SSBCI) to offer non-primarily health-related benefits (NPHRB) in 2024, according to an Oct. 30 report on 2024 non-medical supplemental benefits from ATI Advisory, funded by the SCAN Foundation. The health care research and advisory services firm observed some significant changes across supplemental benefit categories, and one social determinants of health (SDOH) expert expressed disappointment in MA organizations’ uptake of these benefits.

About 30% of MA plans are offering any NPHRB for 2024, just a 2.4% increase from the current plan year. And while fewer plans are using SSBCI to offer these benefits, the Center for Medicare and Medicaid Innovation’s Value-Based Insurance Design (VBID) model got a boost, with 10.4% of MA plans offering NPHRBs through the VBID model in 2024 vs. 5.5% of plans in 2023. (Plans participating in the newly extended VBID model are required to start offering supplemental benefits that address key SDOH in 2025, and ATI suggested some payers may be getting a jump on this.)

After Blue Cross Blue Shield of Michigan implemented a five-day opioid prescribing limit in 2018, members who underwent general surgeries were prescribed and filled fewer prescriptions and had similar patient-reported outcomes compared with enrollees who had procedures before the program was initiated, according to a study published in JAMA Health Forum on Oct. 13.

James Grant, M.D., BCBS of Michigan’s chief medical officer, tells AIS Health, a division of MMIT, that the results show payers can steer people away from potentially addictive opioids without having a negative impact on their pain management.

Prominent insurance brokers are expecting large percentage increases in employer-plan costs next year, brought on by factors like rising labor costs and higher health care utilization. But there isn’t likely to be any relief in coming years, and experts say plan sponsors will have to be creative and disruptive if they hope to cushion the blow of increasing expenses.

Brokers Mercer Inc., Aon PLC and WTW PLC project that average employer plan costs will increase between 5.4% and 8.5% in plan year 2024.

And while employers don’t have to pass that onto employees in the form of higher monthly plan rates, some industry experts expect rising premiums are on the horizon, too.

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.