Articles

  • Congress, Administration Serious About Tackling Health Care Costs

    July 16, 2019
    As more people struggle with their medical bills, Congress has been introducing a raft of new legislation aimed at cutting costs and making pricing more transparent. The multi-pronged, bipartisan effort targets the lack of transparency in pricing particularly for pharmaceuticals, as well as surprise medical bills that have left many Americans reeling, and there are also other efforts aimed at reducing the cost burden on payers: the general public and employers. And since consumers are affected regardless of their political affiliation, congresspersons are reaching across the aisle to push through legislation to address this crushing problem. There are several draft proposals, but word is a number of bills are expected to be introduced soon. Surprise ...
  • Most Drugs Inflation Covered in Increased Premiums

    July 9, 2019
    Retail prescription drug spending grew 36% over the four-year period ended Dec. 31, 2016, but out-of-pocket spending for health plan enrollees remained steady, according to a recent study by the Pew Charitable Trusts. The study, “The Prescription Drug Landscape, Explored,” found that patients are covering the lion’s share of the cost through higher premium outlays, while large pharmacy benefit managers are passing on a larger portion of the manufacturer rebates they receive to insurance plans. The study found health plan enrollees have largely been sheltered from rapidly rising drug costs due to: More of the health insurance premium being dedicated to pharmacy benefits. The percentage of health insurance premiums allocated to pharmacy benefits increased to 16.5% in 2016 ...
  • New Rule Allows Employers to Pay Workers to Buy Their Own Health Coverage

    July 3, 2019
    The Trump administration has issued new rules that would allow employers to provide workers with funds in health reimbursement accounts (HRAs) that can be used to purchase health insurance on the individual market. The rule reverses a long-standing part of the Affordable Care Act that carried hefty fines of up to $36,500 a year per employee for applicable large employers that are caught providing funds to workers so they can buy insurance. The rule was put in place to keep employers from shunting unhealthy or older workers from their group health plans into private insurance and government-run marketplaces. Under the rules issued by the Departments of Health and Human Services, Labor and Treasury, employers would be authorized to fund, on a pre-tax basis, ...
  • Proposed Rules Would Affect Prescription Drug Plans

    June 25, 2019
    The Centers for Medicare and Medicaid Services has floated proposed regulations that would affect drug benefits for group plans and association plans and attempt to reduce drug expenses for health plan enrollees and drug plans. While the rules seem to be focused on individual plans sold on government-run exchanges, three of the changes would also affect small and mid-sized group plans. Mid-year formulary changes Under current regulations, health insurers are barred from making changes to their drug formularies mid-year. They can only introduce changes upon renewal. The CMS says it wants to boost incentives for drug plans to use generic drugs, so it is proposing a new rule that would allow insurers to: Add a generic drug that becomes available mid-year. Remove the ...
  • New Law Bars Pharmacy Benefit Manager Gag Clauses

    June 18, 2019
    President Trump has signed two bills into law that would add transparency to drug pricing by banning gag clauses imposed by pharmacy benefit managers (PBMs) that bar pharmacists from discussing drug prices with the person buying prescription medication. The bills, passed with bipartisan support, take aim at the PBM practice of clawbacks, which occur when the copayment set by the PBM is more than the actual cash price of the drug. So instead of the policyholder being able to pay less for the drug, the PBM will usually pocket the difference. And because of gag clauses, most policyholders never get to know that they can save money if they decide not to use their PBM benefits and instead pay cash for the drug. Insurers contract with PBMs to manage drug benefit ...
  • DOJ Tells Court to Nullify ACA; What’s Next?

    June 11, 2019
    After a period of relative stability, the future of the Affordable Care Act has once again been thrown into uncertainty. In a surprise move, the Department of Justice announced that it would not further pursue an appeal of a ruling by U.S. District Court Judge Reed O’Connor, and instead asked the 5th U.S. Circuit Court of Appeals to affirm the decision he made in December 2018. O’Connor had ruled that Congress eliminating the penalty for not complying with the law’s individual mandate had in fact made the entire law invalid. But, even though the DOJ won’t be pursuing defense of the law and challenging the ruling on appeal, a number of states’ attorneys general have stepped up to fight the ruling. What this means for the future of the employer mandate is unclear, as the ...