Court Cases

Some Employers Embrace Alternate Funding Programs Despite Legal Issues

Pharmacy benefit consultants have mixed views on how many plan sponsors are turning to alternate funding programs, which aim to save on specialty drug costs by eliminating coverage for certain drugs and diverting costs to pharmaceutical companies’ patient assistance programs. But scrutiny of the programs is growing, with one major pharma company challenging the legality of these programs in court.

“A large percentage” of WTW’s employer clients now are using this strategy, Chantell Sell Reagan, Pharm.D., the national pharmacy practice clinical lead for WTW, tells AIS Health, a division of MMIT.

FTC Will Take a Closer Look at UnitedHealth-LHC Deal

The Federal Trade Commission (FTC) on June 10 made a formal request for information to UnitedHealth Group regarding the integrated health care giant’s announced purchase of LHC Group, Inc., a home health care provider, which could be an indication that the antitrust watchdog will move to block the deal. Experts tell AIS Health, a division of MMIT, that it’s not a certainty that the FTC will take such an action, given the fragmented nature of the home health care industry, but add that UnitedHealth’s singular size and diversification exposes the firm to higher antitrust scrutiny than other national health insurance or provider firms.

UnitedHealth announced its plans to acquire LHC in April, saying it would spend about $6 billion to purchase the provider and amortize some of its debt. The health care giant revealed the FTC’s request for information in a filing with the Securities and Exchange Commission. UnitedHealth has acquired dozens of smaller companies in recent years — and antitrust regulators have begun to pay closer attention as its spending spree has gone on. Notably, in February, the Dept. of Justice sued to block UnitedHealth’s bid to acquire Change Healthcare, Inc., a data and analytics company, joining the state attorneys general of New York and Minnesota in the antitrust enforcement action.

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Judge Strikes Down ‘Accumulator Rule,’ Ending Potential Threat to Patient Assistance

A U.S. district court judge has struck down a CMS rule that would have narrowed the exclusions from Medicaid best price for manufacturer-provided patient-assistance programs. The rule, which was set to go into effect on Jan. 1, would have required drugmakers to determine exactly where their patient assistance is going. If 100% of it was not reaching the patient — particularly via copayment accumulators and maximizers when payers are taking this assistance rather than allowing it to count toward patients’ deductibles and out-of-pocket maximums — that assistance would need to have been included in Medicaid best price and average manufacturer price (AMP) calculations for prescription drugs. This decision, as well as a recent pharma lawsuit against a maximizer company, may spur more pushback against these copay programs, one industry expert tells AIS Health, a division of MMIT.

The Medicaid rebate rule allows state Medicaid programs to get the same discounts on drug prices that manufacturers offer commercial plans purchasing prescription drugs. Manufacturers pay rebates to Medicaid programs that are calculated based on drugmakers’ best price, which is the lowest price the manufacturer gives to most providers of health care services or items, including hospitals, HMOs and MCOs — but not patients. It includes any price adjustments, such as discounts and rebates, but not manufacturer-provided assistance to patients.

FTC Files Lawsuits to Block Hospital Deals in N.J. and Utah

The Federal Trade Commission (FTC) on June 2 said it had filed lawsuits to block hospital mergers in New Jersey and Utah. Health policy experts tell AIS Health that health insurers and other payers likely will welcome the FTC’s actions as mergers limit competition and lead to higher prices.

The FTC is looking to block HCA Healthcare, Inc.’s acquisition of five hospitals that Steward Health Care owns in Utah. The agency is also aiming to deny RWJBarnabas Health’s purchase of Saint Peter’s Healthcare System, a non-profit that operates a hospital in New Brunswick, N.J. The Utah trial is scheduled to begin on Dec. 13 and the New Jersey trial is scheduled to start on Nov. 29.

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Judge Strikes Down CMS’s So-Called ‘Accumulator Rule’

A U.S. district court judge has struck down a CMS rule that would have narrowed the exclusions from Medicaid best price for manufacturer-provided patient-assistance programs. The rule, which was set to go into effect on Jan. 1, would have required drugmakers to determine exactly where their patient assistance is going. If 100% of it was not reaching the patient — particularly via copayment accumulators and maximizers when payers are taking this assistance rather than allowing it to count toward patients’ deductibles and out-of-pocket maximums — that assistance would need to have been included in Medicaid best price and average manufacturer price (AMP) calculations for prescription drugs. This decision, as well as a recent pharma lawsuit against a maximizer company, may spur more pushback against these copay programs, one industry expert tells AIS Health, a division of MMIT.

News Briefs: UnitedHealthcare to Restrict Aduhelm Access

UnitedHealthcare will restrict access to Aduhelm (aducanumab) across all of its books of business, arguing that “Aduhelm is unproven and not medically necessary for the treatment of Alzheimer’s disease due to insufficient evidence of efficacy,” according to company documents obtained by Stat News. The decision from the insurance branch of UnitedHealth Group, the largest private carrier in the country, follows a controversial move by CMS to restrict access to the drug mainly to patients who are participating in clinical trials. In a National Coverage Determination, CMS said the Medicare program will cover Biogen Inc.’s Aduhelm only for patients enrolled in randomized, controlled clinical trials conducted either through the FDA or the National Institutes of Health. For Medicare patients to be prescribed Aduhelm, they also must have a clinical diagnosis of mild cognitive impairment due to Alzheimer’s disease or mild dementia with a confirmed presence of plaque on the brain.

News Briefs: New CMS Report Finds Non-White Medicare Advantage Enrollees Continue to Receive Worse Care

A new report looking at disparities in care for Medicare Advantage beneficiaries by race, ethnicity and sex found that non-white MA enrollees generally received worse care in 2020 than their white counterparts. Racial and ethnic differences were more glaring for clinical care measures than for patient experience measures, with scores for Black MA enrollees falling below the national average for 14 out of 36 clinical care measures, according to the April report, which was prepared by The RAND Corp. for the CMS Office of Minority Health. Researchers relied on Consumer Assessment of Healthcare Providers and Systems (CAHPS) data collected from March to May 2021 and the Healthcare Effectiveness Data and Information Set reflecting care received from January to December 2020. White enrollees reported care that was in line with the national average on all patient experience measures from the CAHPS survey, while their scores were similar to the national average on 31 clinical care measures and above average on five measures. Scores for American Indian and Alaska Native MA enrollees were also below the national average on 14 clinical care measures, and scores for Hispanic MA beneficiaries were worse than average on 11 such measures.