Health plan officials are still trying to determine just how the final rules for the new Medicare prescription drug benefit will affect them, because it appears that government officials tried their best to address the competing concerns of all players. The Centers for Medicare and Medicaid Services unveiled regulations on Jan. 21 that would allow insurers to end coverage for a drug or increase the copayment by giving 60 days notice to beneficiaries. On the other hand, insurers would have to provide extensive clinical and scientific reasons for those exclusions.

"We are in the process of reviewing the entire regulatory structure for both the prescription drug program and the Medicare Advantage program and commend CMS for working hard to create a sound regulatory framework...," says Karen Ignagni, CEO of America's Health Insurance Plans.

Medicare enrollees who do not currently have a prescription drug benefit may enroll in the new program in November. Coverage is expected to begin Jan. 1, 2006. On average, beneficiaries will pay about $35 a month in premiums, with a $250 annual deductible. Seventy-five percent of the next $2,000 in drug expenditures will be covered by Medicare. Then, the beneficiary will have to pay for the drugs until the expenditures reach $5,100. After that, Medicare pays for 95 percent of the costs.

The rules that determine which drugs will be covered are based on guidelines released by the United States Pharmacopeia. That organization says that there are 146 types of drugs that Medicare should cover and that beneficiaries should be offered coverage for at least two drugs in each of 41 categories.

The new CMS guidelines also outline the five possible ways beneficiaries may challenge drug exclusions. They include appeals to the health plan itself, to an outside organization serving as an arbitrator, to an administrative law judge, and to a panel under the Department of Health and Human Services — the Medicare Appeals Council. If all else fails, the beneficiary may file a federal lawsuit.

Exactly how the guidelines will work in practice remains to be seen.

"The law, the biggest expansion of Medicare since its creation in 1965, depends on private health plans to deliver the new benefit," the New York Times reports. "Insurers, eager to control costs, wanted to limit the number of drugs they must cover. Doctors, drug companies, and advocates for beneficiaries wanted to maximize the number. The government offered a compromise. It allows the use of formularies and says insurers must cover only one drug in a therapeutic category or class if only two drugs are available and one is clearly superior."

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.