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Trends That Matter for California Medicaid Program

February 28, 2019

Under the direction of its new governor, Democrat Gavin Newsom, California is planning to take control of the pharmacy benefit for all of the state’s Medi-Cal beneficiaries, AIS Health reported.

Under the direction of its new governor, Democrat Gavin Newsom, California is planning to take control of the pharmacy benefit for all of the state’s Medi-Cal beneficiaries, AIS Health reported.

Medi-Cal, California’s Medicaid program, is served by more than 20 managed care organizations. MCOs are currently able to contract with a pharmacy benefits manager, but the new plan would allow the state to directly negotiate drug prices, purchase drugs in bulk and develop transparency on drug cost reimbursement.

With nearly 90% of the state’s 12.1 million Medicaid beneficiaries enrolled in managed care, a shift to fee-for-service would entirely upend existing PBM relationships in Medi-Cal, the largest managed Medicaid program in the U.S.

Radar On Market Access: Highmark Expands Proving Ground for Innovative Therapies

February 28, 2019

After Highmark Health expanded from an insurer to an integrated delivery system, the organization decided it was uniquely positioned to launch a platform to test early-stage, FDA-approved medical innovations that were struggling to attain the evidence needed for widespread adoption — and, critically, insurance reimbursement, AIS Health reported.

After Highmark Health expanded from an insurer to an integrated delivery system, the organization decided it was uniquely positioned to launch a platform to test early-stage, FDA-approved medical innovations that were struggling to attain the evidence needed for widespread adoption — and, critically, insurance reimbursement, AIS Health reported.

Nearly four years later, Highmark Health Plan and its affiliate Allegheny Health Network have changed their policies and purchasing contracts to provide therapeutic innovations to members after gathering evidence on their effectiveness. Examples include HeartFlow, which can create a 3D model of coronary arteries and blockages, and FreeSpira, a digital therapeutic that reduces debilitating panic attacks.

Highmark also opted to transform VITAL from an internal platform to a commercial offering — meaning companies pay Highmark to test their products, says Eileen Rodgers, director of Highmark’s VITAL Innovation Program.

Making VITAL a commercial offering, according to Rodgers, helps it source new innovations and make the program a recognizable name out in the marketplace. “Our intent really is to draw new innovations to Highmark Health as kind of a center of gravity,” she says.

For the startup companies that work with VITAL, the services the program offers can be the difference between staying afloat or going under, Rodgers points out.

“A lot of innovations are FDA approved and make it past clinical trials to be commercially available, but because there’s no financing mechanism, the delivery systems are unable to buy them,” she says.

But the real-world evidence VITAL provides can help startups get over that hurdle faster by making payers’ decision to cover their product a safer bet.

Radar On Market Access: As Cystic Fibrosis Costs Rise, Payers Seek New Strategies

February 26, 2019

Payers typically use tools such as prior authorization and utilization review to manage cystic fibrosis treatments, but PBM experts say they are on the cusp of implementing more innovative strategies that might help to improve adherence while addressing the cost of cystic fibrosis drugs, AIS Health reported.

Payers typically use tools such as prior authorization and utilization review to manage cystic fibrosis treatments, but PBM experts say they are on the cusp of implementing more innovative strategies that might help to improve adherence while addressing the cost of cystic fibrosis drugs, AIS Health reported.

Cystic fibrosis, an inherited chronic disease that attacks the lungs and digestive organs, is caused by mutations in the cystic fibrosis transmembrane conductance regulator (CFTR) gene. CFTR modulators and other therapies carry a high price tag, typically costing $250,000 to $368,000 per year. Other drugs, most of which do not have generic equivalents, can add tens of thousands of dollars to that total.

The majority of payers use traditional strategies, including pipeline monitoring, pharmacy and therapeutics committee drug review for formulary positioning, and prior authorization to confirm both the diagnosis and the presence of the specific genetic mutation targeted by the cystic fibrosis drugs, says Lynn Nishida, vice president of clinical product at Boston-based WithMe Health.

Still, “a growing number of payers are looking for out-of-the-box solutions for additional strategies in managing these drugs,” Nishida says. Cystic fibrosis drugs typically receive orphan drug status, which means payers cover them because they’re the only option for patients, but it can also mean they’re associated with higher costs, she says.

Payers expect multiple new drugs for cystic fibrosis over the next few years. Among products in the pipeline are more than a dozen agents aimed at restoring CFTR function, five products for clearing mucus, four anti-inflammatories, eight anti-infectives and one nutritional agent.

Managing infections in cystic fibrosis patients is a priority, says Mesfin Tegenu, R.Ph., president of PerformRx. However, effective antibiotics are also a main driver of cost.

Adherence to cystic fibrosis medications can be a challenge to manage, with studies showing a total reported mean adherence rate of 48% and a large drop-off in adherence in the adolescent years.

Nishida says that deploying one-on-one disease management/case management to closely monitor patients can make a significant difference, and might lead to savings in drug costs.

MMIT Reality Check on HIV (Feb 2019)

February 22, 2019

According to our recent payer coverage analysis for HIV treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

According to our recent payer coverage analysis for HIV treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

To help make sense of this new research, MMIT’s team of experts analyzes the data and summarizes the key findings for you. The following are brief highlights. To read the full piece, including payer coverage, drug competition and prescriber trends, click here.

Payer Coverage: A review of market access for HIV treatments shows that under the pharamcy benefit, more than 75% of the covered lives in commercial formularies have utilization management restrictions.

Trends: Contracting is prevalent for drugs in the same HIV grouping, with most activity focused on tiering preference. Patent expirations are expected for single agents. Via AIS Health.

Perspectives on California’s Plan to Move Medicaid Pharmacy Purchasing to FFS

February 21, 2019

Under the direction of its new governor, Democrat Gavin Newsom, California is planning to take control of the pharmacy benefit for all of the state’s Medi-Cal beneficiaries — the vast majority of which currently have that part of their care administered by private insurers and their PBMs, AIS Health reported. What’s more, the order directs state agencies to create bulk-purchasing arrangements for high-priority drugs and establish a framework for letting private businesses and insurers join the state’s buying pool.

Under the direction of its new governor, Democrat Gavin Newsom, California is planning to take control of the pharmacy benefit for all of the state’s Medi-Cal beneficiaries — the vast majority of which currently have that part of their care administered by private insurers and their PBMs, AIS Health reported. What’s more, the order directs state agencies to create bulk-purchasing arrangements for high-priority drugs and establish a framework for letting private businesses and insurers join the state’s buying pool.

The idea of the state’s Medicaid program shifting to an entirely fee-for-service drug benefits system is already sparking worries about what it will do to PBMs’ bottom lines.

“We suspect that the fee-for-service aspect [of the executive order] may have an adverse impact on PBMs and potentially MCOs that provide managed Medicaid services in the state,” RBC Capital Markets, LLC analyst George Hill wrote in a research note. Currently, California’s Medicaid managed care organizations contract with 10 different PBMs to administer the pharmacy benefit for 10.64 million managed Medicaid lives — which comprise nearly 90% of the state’s total Medicaid lives.

According to L.A. Care CEO John Baackes, one concern for managed care plans is the fact that carving out benefits makes it more difficult to coordinate care.

“I think one of the advantages of a managed Medi-Cal plan like ours is that for people who are in very difficult circumstances health-wise, we do provide an element of care management that’s important,” he says. “And if there’s an element of the benefit that we don’t control, then it’s awkward.”

Regarding the the concept of California starting a bulk-pharmaceutical buying program, Andrey Ostrovsky, M.D., former chief medical officer at CMS’s Center for Medicaid and CHIP Services and current CMO at Solera Health, says it could indeed help drive down prices, since the PBMs that currently serve the state operate independently.

But other experts aren’t so sure.

“If you’re negotiating directly with the manufacturers on drug prices, how’s the delivery system of that going to work, and how are the pharmacies, at the local level, going to be able to maintain a profit and not lose money?” asks Brian Anderson, a principal with Milliman, Inc. Just because a state can negotiate a large rebate from drug manufacturers doesn’t necessarily mean it’s negotiating a lower drug price, he adds.