legislation & regulation

News Briefs: AMA, AHA Scrap Surprise Billing Lawsuit

The American Medical Association (AMA) and American Hospital Association (AHA) on Sept. 20 both pulled lawsuits challenging rulemaking related to the No Surprises Act (NSA), the federal law that banned most balance billing. In a joint statement, the country’s two largest provider trade groups said that “the lawsuit became moot when the Administration released a revised final rule on Aug. 26. However, the AHA and AMA remain concerned that the final rule continues to favor insurers and does not line up with what Congress intended when it passed the law.” A broad group of providers objected to the Biden administration’s guidance on Independent Dispute Resolution (IDR), the HHS-managed arbitration process that will resolve balance billing disputes. Payers and providers have viewed IDR regulations as a zero-sum issue. Providers have argued that rulemaking favored insurers at their expense. The Biden administration recently released new guidance designed to address providers’ concerns and head off legal challenges; while that has worked in the AMA and AHA’s cases, several other lawsuits from providers are still in progress.

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Drug Price Negotiation Will Require New CMS Regulations, Staffing

Now that Medicare can negotiate the price of prescription drugs it purchases, the Biden administration needs to figure out how it will hash out deals with drugmakers. Experts tell AIS Health, a division of MMIT, that implementation of the long-sought negotiation program will come with plenty of challenges and pitfalls.

The administration will have to issue new regulations, hire hundreds of staff, determine which drug prices will be negotiated first and design the criteria that will select drugs for negotiation in the future.

New Suit Claims Copay Accumulators Violate ACA, but Will Judge Agree?

In a newly filed lawsuit, three patient groups are challenging a federal regulation that allows what they call an “evil money grab” by health insurers and PBMs: copay accumulator adjustment programs. The lawsuit contends that the rule violates both the Affordable Care Act and the Administrative Procedure Act, and legal experts tell AIS Health that it’s still an open question whether those claims will prevail.

The rule in question is the 2021 Notice of Benefit and Payment Parameters (NBPP), an omnibus regulation issued annually that chiefly sets ground rules for the ACA marketplaces. It drew the ire of groups that represent patients with chronic conditions by allowing individual and group health plans to implement copay accumulator adjustment programs, which prevent patients from counting the value of drug manufacturer coupons toward their deductibles or out-of-pocket payment limits. Drugmakers often offer coupons for pricey branded drugs — a practice that they say helps increase access to vital medications. But insurers contend that such coupons push consumers toward high-priced medicines, forcing health plans to raise premiums across the board to compensate.

RFI Commenters Envision More Plan Flexibility, Improved Transparency in MA

After giving stakeholders a month to formulate their thoughts on how best to address a variety of aspects of the Medicare Advantage program, CMS received nearly 4,000 comments on its request for information (RFI). An AIS Health review of select letters reveals comments on a multitude of hot-button topics including beneficiary decision-making, marketing practices and plan oversight, and MA reimbursement.

CMS published the MA-focused RFI on Aug. 1 and asked for input by Aug. 31. The sprawling request asked commenters to consider dozens of questions on key topics such as health equity, risk adjustment, social determinants of health (SDOH), supplemental benefits and value-based care.

New Suit Claims Copay Accumulators Violate ACA, but Will Judge Agree?

In a newly filed lawsuit, three patient groups are challenging a federal regulation that allows what they call an “evil money grab” by health insurers and PBMs: copay accumulator adjustment programs. The lawsuit contends that the rule violates both the Affordable Care Act and the Administrative Procedure Act, and legal experts tell AIS Health that it’s still an open question whether those claims will prevail.

The rule in question is the 2021 Notice of Benefit and Payment Parameters (NBPP), an omnibus regulation issued annually that chiefly sets ground rules for the ACA marketplaces. It drew the ire of groups that represent patients with chronic conditions by allowing individual and group health plans to implement copay accumulator adjustment programs, which prevent patients from counting the value of drug manufacturer coupons toward their deductibles or out-of-pocket payment limits. Drugmakers often offer coupons for pricey branded drugs — a practice that they say helps increase access to vital medications. But insurers contend that such coupons push consumers toward high-priced medicines, forcing health plans to raise premiums across the board to compensate.

HHS Rule Takes Aim at Bias in Health Care Algorithms

While a recently proposed rule from HHS would mostly reinstate nondiscrimination protections that the Trump administration unwound, it also addresses an emerging issue that is likely to stir up controversy in the health insurance industry: bias in clinical algorithms.

The regulation, posted Aug. 4 in the Federal Register, would for the first time at the federal level prohibit a covered entity “from discriminating against any individual on the basis of race, color, national origin, sex, age, or disability through the use of clinical algorithms in decision-making,” explains a July 27 Health Affairs article summarizing the proposal. “Covered entities” include all health programs and activities receiving federal financial assistance, including health insurance issuers that get federal funding.

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News Briefs: Biden Admin Takes Steps to Streamline Medicaid, CHIP Eligibility

CMS on Aug. 31 proposed a new regulation aimed at streamlining applications, verifications, enrollment and renewals for Medicaid and Children’s Health Insurance Program (CHIP) coverage. The rule would make a host of changes, such as eliminating the requirement that individuals apply for other benefits as a condition of Medicaid eligibility, requiring that states conduct renewals no more than once every 12 months, and establishing specific guidelines for states to check available data prior to terminating eligibility when a beneficiary cannot be reached due to returned mail. CMS said it estimates that “this proposed rule would remove barriers to enrollment and increase the number of eligible individuals who obtain coverage and are continuously enrolled in Medicaid and CHIP.”

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AHIP Pledges to Step Up Mental Health Parity Compliance

The federal government and patient advocates have directed withering criticism regarding behavioral health coverage toward health plans in recent months. AHIP, the health insurance industry’s largest trade group, responded this week with a statement from its board emphasizing its commitment to equitable access to mental health benefits.

In January, the federal agencies that regulate health plans published a biannual report which found that health insurers have systematically failed to document the level of mental health care access they provide to members. That documentation is part of a yearslong federal effort to make plans comply with mental health care parity laws, which stipulate that health plans are not allowed to impose benefit limitations — non-quantitative treatment limits (NQTLs) — on mental health care that are more severe than limits placed on medical and surgical benefits.

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Industry Experts Question Alternative Funding Companies That Carve Out Some Specialty Drugs, ‘Abuse’ Charities

As companies are exploring different strategies to keep their pharmaceutical costs in check, a spate of so-called alternate funding companies has emerged in the industry. And while they might appeal to a potential client at first glance, some — such as ones that carve out certain specialty drugs and seek coverage from patient assistance funds — may not be worth the investment, say some industry sources, who encourage companies to take a closer look at what their savings actually are.

During a July 29 webinar titled Specialty Drugs Update: Trends, Controversies, and Outlook, longtime industry expert Adam J. Fein, Ph.D., CEO of Drug Channels Institute, noted that while the use of copay accumulators and maximizers has risen, “there is another newer trend that’s even scarier, and that’s the business of what some people call specialty carve-outs,” he said, calling this “the shady business of specialty carve-outs.” Vendors such as ImpaxRX, Payd Health, SHARx, PayerMatrix and Script Sourcing get payers to exclude specialty drugs and then get those drugs covered via patient-assistance programs at manufacturers or charitable foundations. If patients are denied patient assistance, coverage reverts to the company’s payer/PBM/specialty pharmacy.

As States Seek to Regain Control of MA Marketing, Senate Launches Probe Into Plan Practices

As CMS urges Medicare Advantage insurers to tighten up their oversight of third-party marketing organizations (TPMOs) and as state insurance regulators seek to regain authority over MA marketing that was transferred to CMS nearly 20 years ago, Sen. Ron Wyden (D-Ore.) wants answers about “potentially deceptive marketing tactics practiced by Medicare Advantage plans.” His investigation could signal legislative interest in returning MA marketing oversight to states, but some industry experts question whether breaking up the CMS-owned process would be in the best interest of beneficiaries.

In letters sent last month, the Senate Finance Committee chairman wrote to 15 state insurance commissioners and State Health Insurance Assistance Programs (SHIPs) expressing his concern about reports of increased beneficiary complaints regarding MA and Part D plan marketing materials and “alarming reports that MA and Part D health plans and their contractors are engaging in aggressive sales practices that take advantage of vulnerable seniors and people with disabilities.”