News Briefs

News Briefs: Medicaid MCO Pay Raise Set to Rise in Some States

At least seven states plan to raise capitated payment rates to their contracted Medicaid managed care plans in fiscal year 2025, Modern Healthcare reported. Craig Kennedy, president and CEO of Medicaid Health Plans of America, told the publication that the rates are likely going up “because utilization is increasing post-pandemic.” The article noted that Arizona has proposed a 3% rate increase, California's draft budget includes a 3.8% hike and Missouri is considering a 2.5% raise for managed care plans. But New York plans to reduce insurer compensation by eliminating a quality bonus program and a 1% pay increase that expires this fiscal year.

Doctors are raising the alarm about how health insurers are making it harder for patients to receive coverage for at-home ventilators, the Associated Press reported. The noninvasive ventilators help patients breathe by forcing air into the lungs, often through a mask, and they cost around $1,200 per month. Chuck Coolidge, chief strategy officer for the respiratory supply company VieMed, told the AP that insurance rejections — including both initial approvals and reauthorizations — have increased for patients with Lou Gehrig’s disease and chronic obstructive pulmonary disease. And one neurologist told the news outlet that UnitedHealthcare Medicare Advantage plans now deny nearly all initial requests for the ventilators.

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News Briefs: Wegovy Gains Another Indication

The FDA on March 8 granted Novo Nordisk A/S’s Wegovy (semaglutide) yet another indication — for cardiovascular risk reduction — that could further boost staggering GLP-1 sales. Wegovy is now approved to reduce risk of “major adverse cardiovascular events (MACE) including cardiovascular death, non-fatal heart attack (myocardial infarction) or non-fatal stroke” in adults who are either overweight or obese and have established cardiovascular disease, per a Novo press release. FDA official John Sharretts, M.D., described Wegovy as the first weight loss medication “to also be approved to help prevent life-threatening cardiovascular events in adults with cardiovascular disease and either obesity or overweight.” As the FDA noted in a press release, approximately 70% of U.S. adults are obese or overweight. The new indication was approved after a priority review.

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News Briefs: Coherus Launches Udenyca Onbody

Coherus BioSciences, Inc. launched its Udenyca Onbody, an on-body injector (OBI) presentation of Udenyca (pegfilgrastim-cbqv), the company said Feb. 21. Approved Dec. 22, the OBI is indicated to decrease the incidence of infection, as manifested by febrile neutropenia, in people with nonmyeloid malignancies receiving myelosuppressive anticancer drugs associated with a clinically significant incidence of febrile neutropenia. Udenyca was first approved Nov. 2, 2018, and the leukocyte growth factor is one of six biosimilars of Amgen Inc.’s Neulasta (pegfilgrastim) that the agency has greenlighted. A health care provider must fill the OBI with the co-packaged syringe and apply it to the patient’s abdomen or back of the arm. About 27 hours after it is applied to the skin, the OBI will deliver a 6 mg/0.6 mL dose of Udenyca over about five minutes.

Catalyst Pharmaceuticals, Inc.’s Agamree (vamorolone) is now available in the U.S., the company said March 13. The FDA approved the first-in-class corticosteroid on Oct. 26 for the treatment of Duchenne muscular dystrophy in people at least 2 years old. The company is offering the comprehensive support program Catalyst Pathways Patient Assistance Program for Agamree for eligible patients. Drugs.com lists the price of 40 mg/mL oral suspension as more than $10,013.

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News Briefs: Cyberattack Targets UnitedHealth’s Change Healthcare

Change Healthcare, which UnitedHealth Group acquired in October 2022, has been targeted by a cyberattack. UnitedHealth said in a regulatory filing that on Feb. 21 it discovered “a suspected nation-state associated cyber security threat actor” had gained access to some of Change Healthcare’s information technology systems, and the firm reacted by isolating the affected systems. According to the latest update on a website dedicated to information about the incident, as of Feb. 23 “the disruption is expected to last at least through the day.” All other systems across UnitedHealth Group’s enterprise are operational, and the company said in the filing that it’s working with security experts and law enforcement to address the incident. “The cyberattack against UnitedHealth Group, one of the largest U.S. commercial prescription processors, is credit negative for the company, as financial and reputational impacts may ensue,” Moody’s Investors Service Vice President and Senior Credit Officer Dean Ungar said in a statement emailed to reporters about the incident.

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News Briefs: FTC, HHS Seek Public Comment on Drug Shortages

The Federal Trade Commission (FTC) and HHS issued a request for information (RFI) on Feb. 14 regarding the role of health care group purchasing organizations (GPOs) and drug wholesalers in widespread generic drug shortages. The agencies are seeking public input about market concentration and contracting practices in those two industries and their involvement in the generic drug market. The agencies noted in a press release that they want information about “how both entities may influence the pricing and availability of pharmaceutical drugs.” Last year, the FTC announced an investigation into rebate-aggregating GPOs tied to major PBMs.

A federal judge on Feb. 12 dismissed a lawsuit brought by the trade group Pharmaceutical Research and Manufacturers of America (PhRMA) challenging the Medicare drug price negotiation program. PhRMA sought to overturn the section of the Inflation Reduction Act creating the program, which allows the federal government to negotiate the price of select high-cost medications. Individual drugmakers such as Merck & Co., Bristol Myers Squibb Co., Johnson & Johnson and AstraZeneca PLC all have similar suits underway. CMS on Feb. 1 sent initial price offers to the manufacturers of the first 10 medications that were selected for the Medicare drug price negotiation program, which goes into effect in 2026.

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News Briefs: AHIP CEO Calls for ‘Stability’ in MA Market

In a post published on the insurer trade group’s website, AHIP CEO and President Mike Tuffin advocated for a better-funded Medicare Advantage program. The post occurred about two weeks after CMS released the 2025 Notice of Medicare Advantage and Part D payment changes, which the agency estimated would result in a -0.16% revenue change without an increase in risk scores. Tuffin wrote that “it is essential that funding keep pace to ensure stability and prevent erosion in the benefits and affordability seniors count on in Medicare Advantage.” He cited an ATI Advisory report from March 2023 that found MA enrollees save an average of $2,400 annually compared with fee-for-service Medicare members, as well as a January AHIP report that found the MA population “is both more diverse and lower income than enrollees in fee-for-service Medicare.”

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News Briefs: At Least 16.4M People Have Been Disenrolled From Medicaid

As of Feb. 1, at least 16.4 million Medicaid enrollees had been disenrolled from coverage since last April, representing about one-third of people who had applied to have their coverage renewed, according to KFF. KFF said the number of people disenrolled is likely higher “due to varying lags for when states report data.” Of the people who had been disenrolled, 71% were terminated for procedural reasons, meaning they did not complete the renewal process in time. The disenrollment rates ranged from 13% in Maine to 61% in Texas. Overall, states and Washington, D.C., have reported renewal outcomes for 52% of people enrolled in Medicaid, while the remaining 48% of people were awaiting decisions as of Feb. 1.

Dirk McMahon, UnitedHealth Group’s president and chief operating officer, plans on retiring, effective April 1. McMahon joined UnitedHealth in 2003 and has been president and COO since February 2021. UnitedHealth has not named a replacement for McMahon, whose previous roles at the company included CEO of UnitedHealthcare and president and COO of Optum.

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News Briefs: U.S. Pays 278% More for Drugs than Other Countries

U.S. patients paid an estimated 278% more for prescription drugs than patients in other high-income countries did for the same drugs in 2022, according to a RAND Corp. study. U.S. gross prices for brand-name originator drugs were 422% higher than drugs in the comparison countries, RAND found; after rebates were applied, brand-name drugs still cost more than three times the amount paid in other countries. Unbranded generics were the only category that were not “substantially higher” in price than drugs in other countries. As RAND pointed out, unbranded generics account for 90% of U.S. drug volume but just 8% of total drug spending at manufacturer gross prices.

A Johnson & Johnson employee sued the firm over allegations that the medical manufacturing giant overpaid for prescription drugs dispensed by the firm’s employee health plan — which she alleges is a violation of J&J’s fiduciary duty under the Employee Retirement Income Security Act of 1974 (ERISA). The suit is part of what some legal experts have predicted will be a “” of litigation against plan sponsors that may have paid more than they should have for certain health care services and products, potentially including prescription drugs or pharmacy benefits. The plaintiff in the suit is Ann Lewandowski, a health care policy and advocacy director at J&J, STAT reported.

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News Briefs: CMS’s Cell and Gene Therapy Model Will First Focus on Sickle Cell Disease

CMS’s Cell and Gene Therapy Access Model’s first focus will be on therapies for sickle cell disease, the agency said Jan. 30. The administration unveiled the model almost one year ago as one of three new models for testing by CMS’s Innovation Center to lower the cost of drugs and increase access to new treatments. The model will implement outcomes-based agreements (OBAs) for cell and gene therapies to treat sickle cell disease beginning in 2025 “and may be expanded to other types of CGTs in the future.” The administration estimates that about half of people with sickle cell disease are enrolled in Medicaid, with health care services costing about $3 billion annually. Through the model, CMS will negotiate OBAs, and states can decide whether to enter into the arrangements. “CMS will negotiate financial and clinical outcome measures with drug manufacturers and then reconcile data, monitor results, and evaluate outcomes. The CGT Access Model will begin in January 2025, and states may choose to begin participation at a time of their choosing between January 2025 and January 2026.”

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News Briefs: CMS Sends Initial Offers in Medicare Drug Price Negotiation Program

CMS on Feb. 1 sent initial price offers to the manufacturers of the 10 medications that were selected for the Medicare drug price negotiation program, which goes into effect in 2026. The agency announced the 10 medications in August 2023 and said they accounted for about 20% of total Part D gross covered prescription drug costs from June 1, 2022, to May 31, 2023. The drug companies have 30 days to respond by either accepting the offer or providing a counteroffer. The negotiation period ends on Aug. 1. The drug price negotiation program was implemented as part of the Inflation Reduction Act.

In 2023, 79 health care companies filed for Chapter 11 bankruptcy, according to Gibbins Advisors, a health care restructuring advisory firm. That was up from 46 filings in 2022 and the highest number of Chapter 11 filings in the past five years; the next-highest was 51 in 2019. Gibbins noted that most of the filings involved pharmaceutical and senior care companies. The firm added that 12 hospitals filed for Chapter 11 bankruptcy in 2023, which compares to 11 total between 2020 and 2022. Gibbins analyzes bankruptcies for debtors with at least $10 million in liabilities.

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