Medicare Shop

Blog

  • Medicare Advantage Consensus Wanes Ahead of Election

    Medicare Advantage Consensus Wanes Ahead of Election

    Both the Republican and Democratic parties are more open to Medicare Advantage (MA) reform than they have been in prior election years in a shift that some former federal officials are warning should be a call for the health insurance industry to refocus its messaging and advocacy efforts for the plan.

    “I think the consensus around MA is eroding somewhat,” Alex Azar, former Department of Health and Human Services secretary for President Donald Trump, said during a recent webinar hosted by Avalere (h/t Fierce Healthcare).

    Back in March, the Centers for Medicare & Medicaid Services (CMS) finalized their cut of Medicare Advantage (MA) payments which caused pushback from insurers who say that the move would cause layoffs, a backing away from service areas, as well as fewer supplemental benefits for existing members.

    Many have been pointing to a MedPac report that found that Medicare is projected to overpay Medicare Advantage (MA) plans by around $88 billion in comparison to what traditional Medicare would have hauled.

    “I think some of those [cuts] may come back to haunt them on Oct. 15 when open enrollment comes and we see either increased cost sharing, reduced benefits or increased premiums as a result of what they’ve done two weeks before the election,” Azar said.

    “I do think it behooves the industry to do a lot of myth busting out there on MA,” Azar added. “That’s not to say there aren’t problems with maybe how certain operators have done things. It is a fallacy that MA plans are so profitable and high margin.”

    According to Politico, AHIP will spend seven figures on digital advertising in an effort to ramp up their ability to persuade older Americans to protect Medicare Advantage starting next month.

    At this time it is unclear if that marketing will include an efforts in Medicare SEO or Medicare Agent Marketing verticals.

  • Medicare Drug Price Cuts Could Be Limited Early, But Grow Over Time

    Medicare Drug Price Cuts Could Be Limited Early, But Grow Over Time

    Following the Biden Administrations roll out of the first drug price cuts negotiated by Medicare earlier this month under a new authority granted by the Inflation Reduction Act, reactions have been mixed as many are uncertain as to how the mandate will make an impact moving forward.

    The industry lobbying group PhRMA warned of the potentially dire consequences Medicare’s new powers may levy on drug research and access in a recently issued public statement that claimed that the threat of lower prices for Medicare drugs may impact private funding, as the funds could dry up, research incentives could shift and could result premiums for Medicare to rise.

    “The ironically named Inflation Reduction Act is a bad deal being forced on American patients: higher costs, more frustrating insurance denials and fewer treatments and cures for our loved ones,” PhRMA said in an official statement.

    “The administration is using the IRA’s price-setting scheme to drive political headlines, but patients will be disappointed when they find out what it means for them” PhRMA President and CEO Steve Ubl stated (read the full statement here).

    “There are no assurances patients will see lower out-of-pocket costs because the law did nothing to rein in abuses by insurance companies and PBMs who ultimately decide what medicines are covered and what patients pay at the pharmacy. The ironically named Inflation Reduction Act is a bad deal being forced on American patients: higher costs, more frustrating insurance denials and fewer treatments and cures for our loved ones.”

  • Medicaid Overtakes Medicare Advantage in Q2 Earnings

    Medicaid Overtakes Medicare Advantage in Q2 Earnings

    Despite the challenges in both Medicaid and privately run Medicare Advantage, the major insurers still posted sizeable earnings during Q2, much of which was helped by the health services divisions.

    According to Healthcare Dive, Medicare Advantage and safety-net Medicaid plans are seeing their profitability shrink amid ongoing operational pressures which is a flip from what was initially hoped, and expected.

    Medicaid has faced a number of issues as states remove ineligible beneficiaries from the safety-net coverage creating a myriad of problems including higher risks and higher costs for insurers.

    Insurers’ MLRs, Q2 2023 and Q2 2024

  • Medicare Unveils Results of Drug Price Negotiations

    Medicare Unveils Results of Drug Price Negotiations

    Earlier this month, the United States government stated that they aim to save taxpayers around $6 billion on the prices for 10 widely used prescription drugs under its new authority to leverage Medicare’s market power as well as reduce the cost of brand-name medicines.

    The prices, which are associated with two popular blood thinners, several diabetes treatments and a cancer pill, won’t be active until 2026, but it marks an important step in the long road for  the Inflation Reduction Act.

    The Inflation Reduction Act for the first time has allowed the U.S. government to directly negotiate the prices of select drugs under the agency’s purview.

    “Today, for the first time in history, my Administration is announcing that Medicare has reached agreements on new, lower prices with the manufacturers of all 10 drugs selected for the first round of drug price negotiation. When these lower prices go into effect, people on Medicare will save $1.5 billion in out-of-pocket costs for their prescription drugs and Medicare will save $6 billion in the first year alone. It’s a relief for the millions of seniors that take these drugs to treat everything from heart failure, blood clots, diabetes, arthritis, Crohn’s disease, and more — and it’s a relief for American taxpayers,” President Joe Biden said in an official statement.

    The CMS reported that negotiated prices for the 10 drugs range from 38% to 79% lower, on average from the medication’s current wholesale cost and/or list price set by the suppliers and drugmakers.

    The new rates could save Medicare enrollees an estimated $1.5 billion in out of pocket costs, according to CMS, which is required to publish an explanation for the prices it reached on the first 10 drugs by March 1, 2025.

    “Now that we have seen the final price, we are increasingly confident in our ability to navigate the impact of the IRA on Eliquis,” David Elkins, chief financial officer of Eliquis maker Bristol Myers Squibb said during a call with investors back on July 26th (h/t Healthcare Dive). “Irrespective of short-term dynamics, we remain very concerned about the long-term implications of the IRA on innovation.”

    Per Healthcare Dive:

    Sales, pricing data on IRA selected drugs
    Drug Manufacturer 2023 U.S. sales, $m List price, 30 day supply (2023)* Negotiated price, 30 day supply (2026)*
    Eliquis Bristol Myers, Pfizer $8,592 $521 $231
    Jardiance Eli Lilly, Boehringer Ingelheim $1,600* $573 $197
    Xarelto J&J, Bayer $2,365** $517 $197
    Januvia Merck & Co. $1,151 $527 $113
    Farxiga AstraZeneca $1,451 $556 $178.50
    Entresto Novartis $3,067 $628 $295
    Enbrel Amgen $3,650 $7,106 $2,355
    Imbruvica AbbVie, J&J $2,655*** $14,934 $9,319
    Stelara J&J $6,966 $13,836 $4,695
    Fiasp / Novolog Novo Nordisk $674 $495 $119

    *Reported by the Centers for Medicare and Medicaid Services | U.S. sales are as reported by the company and inclusive of commercial prescriptions.

  • Humana Pays $90 Million in Settlement Over Allegations of Medicare Part D Fraud

    Humana Pays $90 Million in Settlement Over Allegations of Medicare Part D Fraud

    Humana has agreed to pay $90 million as part of a settlement in a whistleblower lawsuit, which was filed by one of Humana’s former actuaries, that accused the insurer of fraud in Medicare’s in Medicare’s prescription drug benefit.

    According to Phillips and Cohen, the law firm that is representing the whistleblower, this marks the first settlement to resolve allegations of fraud in Medicare’s prescription drug contracting process.

    Despite the settlement, Humana denies the allegations.

    Whistleblower Steven Scott filed the lawsuit back in 2016 and alleged that Humana was inflating their costs in order to get a higher paying contract with the government, however Humana was providing below the required level of coverage and pocketed the difference, according to Healthcare Dive.

    By doing so, Humana allegedly pocketed hundreds of millions of dollars, as a profit, per the lawsuit.

    Additionally, the lawsuit alleged that Humana maintained two sets of books to perpetuate the scheme, which ended in 2017 once the government started investigating the case.

    Humana and Scott reached a settlement prior to going to trial, with the company settling without admitting any wrongdoing and to avoid the uncertainty of going through a long trial, and the associated costs.

    “Humana firmly believes that the actuarial assumptions in its prescription drug plan were reasonable and in full compliance with all laws and regulatory requirements, and that the plaintiff’s claims in the case are without merit,” a Humana spokesperson said, per Healthcare Dive.