News Briefs

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.


News Briefs: Walgreens to Complete Acquisition of Specialty Pharmacy

Walgreens Boots Alliance, Inc. (WBA) will assume full control of specialty pharmacy Shields Health Solutions for approximately $1.37 billion cash, the firm said Tuesday. Walgreens already controlled the pharmacy, holding 71% of the company’s stock thanks to a $970 million deal that closed last year. WBA CEO Roz Brewer said in a press release that the deal will allow “further progress on our strategy through Shields’ integrated model, increasing our value to health systems, expanding access to payor partners and supporting improved outcomes and lower costs.”

Centene Corp. agreed to pay $165.6 million to the state of Texas over the state's contention that the insurer overcharged the state's Medicaid program for PBM services, according to legal documents obtained by Kaiser Health News (KHN). The settlement is the largest of a series of settlements from at least a dozen states over similar charges. The Texas settlement is the largest such arrangement, with Centene paying out at least $475 million so far to the states of Arkansas, Illinois, Kansas, Mississippi, New Hampshire, New Mexico, Ohio, Texas, and Washington; three other states have not released the value of their settlements with the Medicaid-focused insurer, per KHN. Centene has divested most of its PBM assets over the past year, and told investors in 2021 that it set aside $1.25 billion to wind down its liability to states in this area.

News Briefs: Home Depot Appeals Settlement With BCBSA

The Home Depot, Inc. and two other employers — Topographic and Employee Services Inc. — have appealed a $2.67 billion settlement reached in connection with a class-action lawsuit against the Blue Cross Blue Shield Association (BCBSA). The litigation, which has been ongoing since 2012, challenges Blues plans’ agreement to divide the country among the association’s 36 members and to restrict members’ ability to offer non-Blues products, alleging that constitutes anticompetitive behavior. The decision to appeal the settlement could delay the disbursement of funds as well as the changes expected to come about from the settlement, which could give Blues plans more freedom to collaborate and consolidate, experts told AIS Health in 2020. A federal judge signed off on the settlement in August.


News Briefs: Cancer Replaced Musculoskeletal Conditions as Biggest Driver of Large Companies’ Health Care Costs

Cancer replaced musculoskeletal conditions as the biggest driver of large companies’ health care costs, according to the Business Group on Health’s 2023 Large Employers’ Health Care Strategy and Plan Design Survey. The survey found that “13% of employers said they have seen more late-stage cancers and another 44% anticipate seeing such an increase in the future, likely due to pandemic-related delays in care.” Between May 31, 2022, and July 13, 2022, the organization polled 135 large employers in various sectors that cover more than 18 million people in the U.S. The survey also found that 99% of respondents said that they are concerned about prescription drug trend. Last year, prescription drugs were responsible for a median of 21% of the companies’ health care costs, and specialty drugs accounted for more than half of pharmacy spend.

News Briefs: HHS Predicts 15M Will Lose Coverage Once Medicaid/CHIP Redeterminations Resume

HHS is currently projecting that 17.4% of Medicaid and Children’s Health Insurance Program (CHIP) enrollees — or about 15 million people — will move out of those programs when the COVID-19 public health emergency (PHE) ends. States have been barred from conducting eligibility redeterminations for Medicaid and CHIP during the PHE, as a condition of receiving enhanced federal funding, but those eligibility checks will resume whenever the PHE ends. Of those expected to lose Medicaid/CHIP coverage, almost one third are expected to qualify for premium tax credits to help defray the cost of Affordable Care Act marketplace plans, and among those people, more than 60% can access a zero-premium plan.


News Briefs: UnitedHealthcare Unveils Rebranded ‘Surest’ Plans

UnitedHealthcare is rebranding a type of employer-sponsored plans previously known as Bind, promising “a new approach to health benefits that removes deductibles and provides clear upfront pricing information to people in advance of treatment.” Now known as Surest, the products are available to self-funded employer plans nationwide and fully insured customers with 51 or more employees in 11 states. The insurer aims to add up to five additional states where self-funded customers can access Surest plans by the end of the year, and notes that more than 150 employers are already using Surest.


News Briefs: ICER Says Evidence for Beti-Cel Demonstrates Net Health Benefit

The Institute for Clinical and Economic Review (ICER) unanimously determined that evidence for bluebird bio, Inc.’s betibeglogene autotemcel gene therapy “is adequate to demonstrate that the net health benefit of beti-cel is superior to that of standard clinical management,” it said in a final evidence report published July 19. “Given the high costs of standard care, cost-effectiveness modeling finds beti-cel meets commonly accepted value thresholds at an anticipated price of $2.1 million — if that price is subject to an 80% payback for treatment failure,” stated ICER in a press release. The FDA’s Cellular, Tissue, and Gene Therapies Advisory Committee (CTGTAC) unanimously voted in June in support of approval for the treatment of people with beta thalassemia who require regular red blood cell transfusions. The FDA is expected to make a decision on the application by Aug. 19.

News Briefs: Court Ends Patent Thicket Lawsuit Against AbbVie

A U.S. appeals court ruled that AbbVie Inc. does not need to defend itself from a lawsuit brought by the city of Baltimore, unions and insurance carriers that alleges the pharma giant used a patent thicket to improperly protect Humira (adalimumab) from competition. Before the ruling, the suit had the potential to upend widespread pharma industry business practices if it had been decided against AbbVie. It also comes amid news that the Biden administration is launching efforts to prevent patent thicketing, a process by which pharmaceutical companies extend patent exclusivity beyond what patent law ostensibly allows. Two laws, the Hatch-Waxman Act and Orphan Drug Act, set typical patent windows at five years and seven years, respectively. High-level officials at the FDA and the U.S. Patent and Trademark Office in July said they would be working together to scrutinize certain practices that could potentially lead to delays in competition from biosimilars and generics.

News Briefs: Uninsured Rate Reaches Record Low

The national uninsured rate reached an all-time low of 8% in the first quarter of 2022, according to new data from the HHS’s National Health Interview Survey. Since 2020, about 5.2 million people have gained coverage, which the report attributed to enhanced marketplace subsidies under the American Rescue Plan Act, the suspension of Medicaid redeterminations during the COVID-19 public health emergency, several recent state Medicaid expansions and “substantial enrollment outreach” by the Biden administration in 2021 and 2022.

If the 12 holdout states expanded Medicaid eligibility under the Affordable Care Act, 3.7 million fewer people would be uninsured next year. That’s according to a new analysis from the Urban Institute and Robert Wood Johnson Foundation, which noted that “Black individuals, young adults, and women —particularly women of reproductive age — would realize the largest coverage gains if the 12 states expanded eligibility.” Fiscally speaking, extending Medicaid expansion nationwide would increase federal spending by $34.5 billion in 2023, but that would be partially offset by $2.6 billion less government spending on uncompensated care.


News Briefs: System-level Deals Dominate Hospital M&A

Recent hospital transactions have mainly involved large hospital systems combining with other big providers, according to a report by Kaufman Hall. During the second quarter of this year, the smaller party of hospital mergers that took place in the quarter had revenues of $1.47 billion on average — more than double the average value of the smaller partner in transactions between 2016 and 2021. Overall, hospital deal volume has slowed, with only 13 transactions announced in the second quarter of 2022 compared to a recent high of 31 transactions in the second quarter of 2017. “We’re seeing that what used to be a hospital M&A game is become a bit more of a system M&A game,” Kaufman Hall managing director Anu Singh told AIS Health earlier this year.