Employer Group Health Plans

UnitedHealth, Blues Spinoff Lucet Proffer Behavioral Health Care Access Solutions

With two recently debuted product offerings, a pair of health care companies aim to solve a problem that has been thrown into sharp relief during the ongoing pandemic: highly variable — and often inadequate — access to behavioral health care services. Industry observers say that both solutions are likely a response to employer clients seeking increased care access points for their covered workers.

One of the announcements comes from UnitedHealth Group, which in January rolled out a virtual behavioral health coaching program that’s available to UnitedHealthcare commercial plan members with mild depression, stress and anxiety. Through the Optum-administered program, 5 million eligible fully insured plan members can access support “through digital modules and 1:1 video or telephonic conferencing and messaging with trained coaches” at no additional cost. Self-insured employers may also purchase the virtual behavioral health coaching program for their employees, UnitedHealth said.

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PBMs, Payers, Employers Anticipate Growing Weight Loss Medication Cost Trends

In October, the FDA granted a fast-track designation for tirzepatide, a medication to treat obese adults or overweight adults with weight-related comorbidities. As such, the agency will likely fully approve the drug in the next few months, according to drug pricing and market access professionals who spoke with AIS Health. They say the decision will have a major impact on PBMs, payers and employers.

Taken together with the FDA’s June 2021 approval of Wegovy (semaglutide) for weight management, tirzepatide’s arrival on the market means “this is really the beginning of the windfall of weight loss drug utilization and costs for employers,” Chantell Sell Reagan, Pharm.D., director and national pharmacy clinical leader at WTW, tells AIS Health, a division of MMIT.

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Ruling on Transgender Care May Have Major Impact on Third-Party Administrators

A district court judge in Washington state ruled on Dec. 19 that Blue Cross and Blue Shield of Illinois violated the anti-discrimination provision of the Affordable Care Act when it served as a third-party administrator (TPA) of health benefits and refused to cover medically necessary gender-affirming care for a transgender boy.

The decision “is something that could have a big impact on administrators” of health benefits, David Kaufman, an attorney with Laurus Law Group LLC, tells AIS Health, a division of MMIT. It came one month after the court certified the case as a class-action lawsuit, meaning other individuals who had their gender-affirming care denied could potentially be involved, “so the case probably has a long way to go before it’s settled law,” according to Kaufman.

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News Briefs: Blues Plans Roll Out Contracting Org for Medical Benefit Drugs

A group of Blue Cross and Blue Shield affiliates has founded the Synergie Medication Collective, a medication contracting organization focused on improving affordability of clinically administered drugs that are covered under patients’ medical benefit. The goal of the organization is to establish “a more efficient contracting model” for things like multimillion-dollar gene therapies and infusible cancer drugs while “utilizing a transparent business model in collaboration with industry stakeholders.” The independent entity will go to market “in January of 2023,” according to a Jan. 5 press release, and is owned by the Blue Cross Blue Shield Association (BCBSA), Elevance Health, Blues-affiliate-owned Evio Pharmacy Solutions and Prime Therapeutics, and nine regional Blues plans. Pharmaceutical industry veteran Jarrod Henshaw will serve as Synergie’s CEO, and BCBSA President and CEO Kim Keck will be the organization’s initial board chair.

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By the Numbers: National Health Insurance Market in December 2022

Three years into the COVID-19 pandemic, enrollment in both commercial health coverage and public health insurance continued its growth. Managed Medicaid membership jumped from 61.4 million in December 2020 to 74.0 million in 2022, while Medicare Advantage (MA) enrollment reached 29.9 million this year, compared with 25.2 million in 2020, according to AIS’s Directory of Health Plans. Commercial health coverage gained 300,000 enrollees over the past year, yet several major health plans reported slight decreases in commercial enrollment, including Centene Corp. and CVS Health Corp.’s Aetna.

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By the Numbers: National Health Insurance Market in December 2022

Three years into the COVID-19 pandemic, enrollment in both commercial health coverage and public health insurance continued its growth. Managed Medicaid membership jumped from 61.4 million in December 2020 to 74.0 million in 2022, while Medicare Advantage (MA) enrollment reached 29.9 million this year, compared with 25.2 million in 2020, according to AIS’s Directory of Health Plans. Commercial health coverage gained 300,000 enrollees over the past year, yet several major health plans reported slight decreases in commercial enrollment, including Centene Corp. and CVS Health Corp.’s Aetna.

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News Briefs: Centene Shakes Up C-Suite

Centene Corp. on Dec. 14 made several C-suite changes in order to “position the company for its next stage of growth.” Ken Fasola, who is currently the firm’s executive vice president of Health Care Enterprises, will be Centene’s new president, while current Executive Vice President and Chief Transformation Officer Jim Murray will become EVP, chief operating officer and report to Fasola. In addition, Dave Thomas will transition from EVP of Markets to CEO of Markets and Medicaid, and President and Chief Operating Officer Brent Layton will become senior adviser to CEO Sarah London “as he begins his transition towards retirement,” the company said.

Separately, Centene on its investor day projected total revenues in the range of $137.4 billion to $139.4 billion and adjusted diluted earnings per share (EPS) in the range of $6.25 to $6.40 in 2023. The firm also said it expects a health benefits ratio (also known as medical loss ratio) of 87.2% to 87.8% next year. “CNC’s ’23 outlook included EPS as expected, though revenue was light,” Jefferies analyst David Windley advised investors in a Dec. 18 research note. He added that Centene’s long-term targets for revenue growth by segment and consolidated EPS growth “are favorable to recent performance, and squarely within a common range across MCOs.”

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Union Suit Against Insurer May Be ‘Tip of the Iceberg’ Amid Plan Sponsor Discontent

If a new lawsuit filed by two Connecticut union locals against Elevance Health, Inc. is successful, health insurers managing self-funded plans could face a torrent of litigation from unhappy plan sponsors. Plan sponsor trade groups and the attorneys handling the Connecticut lawsuit argue that carriers across the country systematically overcharge administrative services only (ASO) plan sponsors for procedures — and that newly available price transparency data proves it.

The Connecticut lawsuit alleges that Elevance, the company formerly known as Anthem (which still sells plans under that brand name), charged excessive fees for some procedures or negotiated kickbacks with providers in its network. Attorneys for the union locals — International Union of Bricklayers and Allied Craftworkers Local 1 and Sheet Metal Workers’ Local No. 40 — accuse Elevance of “either unlawfully retaining…improperly discounted amounts for itself, or…imprudently overpaying providers. Either way, [Elevance] is in breach of its fiduciary obligations to the Plans” under the Employee Retirement Income Security Act (ERISA), the suit argues.

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Employer Shift to Medicare Advantage for Retiree Benefits Drives Up Program Costs, KFF Report Suggests

The share of large employers offering retiree health benefits via Medicare Advantage plans nearly doubled from 2017 to 2022, according to a new analysis of the 2022 Kaiser Family Foundation Employer Health Benefits Survey. Notably, 44% of those firms do not offer any additional health benefit options outside of MA coverage. This shift has emerged as the overall percentage of large firms offering any kind of medical retirement benefit declined dramatically from the 1980s ⁠— KFF found that 66% of large employers offered retiree health benefits in 1988, compared to 21% in 2022.

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Looking to Trim Rising Costs, More Employers Consider MA for Retirees’ Medical Benefits

Of the approximately 30.2 million seniors currently enrolled in Medicare Advantage, more than 5.2 million receive their coverage through an employer-sponsored group MA plan, according to the latest CMS enrollment data. That’s roughly the same proportion of MA enrollees in group plans as last year, when AIS Health reported on the rising popularity of Employer Group Waiver Plans (EGWPs, also commonly referred to as group Medicare). Meanwhile, those offerings are growing as the share of employers sponsoring retiree medical benefits is on the decline, according to recent analysis from the Kaiser Family Foundation, which raised questions about the lack of transparency around these plans and the potential cost implications to the overall Medicare program. But industry experts argue that MA offers value to retirees that they can’t get through traditional, fee-for-service (FFS) Medicare.

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