A CareFirst pharmacy exec talks Inflation Reduction Act ripple effects with HealthLeaders.
"It's like a balloon. When a squeeze inflates drug costs in one place, you have to reign them in somewhere else."
This analogy from Mandi Poplawski, VP of Pharmacy Management for CareFirst BlueCross BlueShield, sums up the pressurized landscape of prescription drug cost management in the U.S. The latest squeeze? The Inflation Reduction Act (IRA). Poplawski believes that the IRA represents "the largest changes to the Medicare Part D program since its inception in 2006."
Other industry insiders agree. Their drug cost views and Poplawski's form HealthLeaders' "What to Watch" list as part of Payer Week—five days of in-depth coverage spotlighting the significant roles and contributions of health insurers. Our week-long theme is Medicare Advantage in the Hot Seat: Challenges and Opportunities.
Drug costs: Today's top 3
Poplawski identifies three current issues that strain the delivery system for Medicare and beyond:
The high cost of prescription drugs for all stakeholders;
The MA donut hole for Medicare beneficiaries; and
CMS's new ability to negotiate Medicare drug prices.
"The high cost of drugs is not specific to Medicare, but it hits beneficiaries harder," stresses Poplawski. "Seniors are often on fixed incomes. This can affect treatment access and nonadherence."
An added pressure is the MA "donut hole." Also called the coverage gap, the donut hole sits between annual member spending limits and the lower cost shares of the catastrophic coverage phase. In 2023, the donut hole applies to spending between $4,660 and $7,400.
"The donut hole is still a factor. The ACA and actions by the Biden Administration are closing the gap but those costs are still a significant concern."
To these factors, Poplawski adds a key IRA provision: CMS authority to negotiate Medicare drug costs with manufacturers.
CMS plays PBM
With negotiation ability, Poplawski notes that "CMS is stepping into a PBM role": setting a maximum fair price for select drugs in the Medicare program (original, MA, and Part D). This "all-in price," says Poplawski, will "trickle down across the whole supply chain"—the squeeze of the balloon she referred to previously.
The pressure starts with lower prices for select drugs:
10 Part D drugs, effective Jan. 1, 2026;
Another 15 in 2027 (Part D) and 2028 (Part D or Part B); and
20 Part B or D drugs annually thereafter.
Per its initial guidance, CMS will announce the first 10 drugs on Sept. 1, 2023.
Impacts on cost, utilization, and utilization management
Poplawski believes that lower drug costs under the IRA will drive higher costs elsewhere and identified three impact areas:
Increased utilization, Part D costs, and utilization management for select drugs;
Whether CMS drug price negotiations will affect other lines of business; and
How manufacturers will react.
The IRA will shift drug costs liability from the government and beneficiaries to health plans. As a result, says Poplawski, "costs will go up significantly for the small subset of members that drives more liability."
This in turn will increase utilization management for prescription drugs (e.g., prior authorization, step therapy, quantity limits).
Dr. Adam Fein from Drug Channels notes that—under the IRA—Part D plans will no longer have an incentive to steer members toward higher list price drugs, which speeds entry into the catastrophic coverage phase where plans have no liability.
Impacts on multiple lines of business
Poplawski wonders how CMS Medicare price controls could apply to other lines of business.
HealthLeaders notes that this "other" still includes Part D plans because they will be impacted differently by the new cost negotiations than MA plans with embedded prescription drug coverage (MA-PD).
Here, we see bigger predictions from Drug Channels' Fein. Noting that standalone drug plans can't capture the added medical-side savings from better medication adherence, Fein predicts that payers will steer members toward MA-PD versus Part D plans.
"We expect Medicare Advantage plans to keep utilization management levels below PDPs as a strategy to attract more seniors to select MA-PD plans," writes Fein.
Impacts on other stakeholders
Poplawski does not go as far as Fein on Part D market impacts. She does site three possibilities, however, for the IRA's impact beyond health plans:
Manufacturers could consider new ways to make up for lost revenue (e.g., raise the price of drugs not included in CMS negotiations).
They could align cost control strategies with the IRA (e.g., become a category leader for negotiated drugs).
PBMs may need to shift strategies too (e.g., redefine their value proposition now that CMS can negotiate prices).
Poplawski named other trends to watch: the end of manufacturer rebate caps in Medicaid, the impact of site-neutrality of Part B drug costs, and the white hot biosimilars market.
Watch for a follow-up exclusive with the CareFirst VP in the months to come.
Editor's note: This story was updated on 6/9/23 with the correct name for the writer of Drug Channels, Dr. Adam Fein. HealthLeaders regrets this error.
Yes and no, but keep an eye on CMS' growing Value-Based Insurance Design model.
VBID-X sounds like a medication. Should you ask your doctor if VBID-X right for you?
Probably—but you'll need your insurer's help too.
VBID-X (Value-Based Insurance Design) is a model plan that designates healthcare services as either high or low value based on clinical evidence. VBID-X proposes low-to-no cost sharing for high-value services and higher cost sharing for low-value ones.
While VBID-X plans don't technically exist, VBID's footprint is in more places than you might think. And it got a strong start with CMS' VBID innovation model.
This exploration of VBID in Medicare Advantage (MA, and other plan types) is part of HealthLeaders' Payer Week—five days of in-depth coverage spotlighting the significant roles and contributions of health insurers.
VBID: What, when and where
Only a few of CMS' value-based care (VBC) models have included MA plans and VBID is one of them. The other three are the Part D Senior Savings Model, Oncology Care Model (OCM, replaced by the Enhanced Oncology Model), and ACO REACH.
Seven states to 50, the District of Columbia, and all U.S. territories;
Seven disease states to any chronic condition; and
Chronic conditions only to social drivers of health (SDOH), reward and incentive programs, telehealth, wellness and healthcare planning, and hospice benefits.
For CY2023, CMS added a voluntary Health Equity Incubation Program.
The pioneers, newbies, early outs, and nationals
Since 2017, VBID has grown from nine to 50-plus MA Organizations (MAOs), with these callouts:
The pioneers: Among national MA plans, only Aetna—now a CVS Health company—has participated since 2017. Other early adopters include Highmark Health and BlueCross BlueShield of Michigan; the latter left in 2023.
Newbies: While new entry is not surprising for startups like Bright Health Group, it is for nationals like Centene, which only joined VBID in 2023.
Early outs: Some regional plans that could join VBID in 2017 left the model after only two years, including BCBS-MA and Independence Blue Cross.
The nationals: Humana and UnitedHealth Group have participated in VBID since at least 2020. Cigna and Elevance Health joined in 2022.
Healthfirst Spotlight
CMS VBID participant Healthfirst highlights its model differentiators and lessons learned in an exclusive interview for HealthLeaders Payer Week.
VBID results so far
In December 2022, Duke University Press summarized a few CMS VBID results (2017-2019):
Utilization: More member use of high-value services (e.g., primary and specialty care visits, medication adherence)
Savings: While VBID did not generate savings in its first three years, the program proved cost neutral to Medicare.
Increased Customization: More members are receiving more diverse, customized benefits—a projected 3.7 million in 2022 and a 300%-plus increase since 2020 (767,124).
How should these results be evaluated? Broadly and longitudinally.
VBID did not generate savings through 2019, but even cost neutrality is a positive for Medicare. VBID's low-but-growing enrollment is also a positive. Better to start small when the delivery system's future is at stake.
But perhaps the most important way to evaluate VBID is its ripple effect.
From demonstration to national benefit design model?
CMS demonstrations can help codify national changes. CMS' Part D Senior Savings model piloted the $35 per month insulin cost-sharing cap that will extend to all Medicare beneficiaries thanks to the Inflation Reduction Act.
CMS' VBID model has had a similar effect. Duke University Press notes it has influenced standardized VBID benefit design—the previously mentioned VBID-X—among state-run Exchanges, other CMS pilots targeting nonmedical supplemental benefits, and certain allowable Health Saving Account payments.
The Center for VBID at the University of Michigan believes that health equity may provide the next push that VBID-X needs. The Center laid much of the groundwork for VBID-X. And its director, Dr. Mark Fendrick, has encouraged hesitant payers to realize they've already embraced VBID as part of ACA requirements—and to go further.
"I'm not suggesting this is going to save the US health care system, but if you're interested in walking the walk, about changing your benefit design to improve individual and population health and especially with a motivation to enhance equity, these are the things I would suggest you do," Fendrick said.
CMS has extended VBID through 2030. This means that the model you've probably heard less about than MSSP or ACO REACH may drive the next generation of payer-led MA value-based benefits.
The payer is one of only two Medicare Advantage plans focused solely on social drivers of health in its CMS model.
As other stakeholders search for a business case to invest in social drivers of health, Healthfirst has gone all in.
Healthfirst is one of New York's largest not-for-profit health insurance companies, serving more than 1.8 million members. In an exclusive interview, SVP of Medicare Jen Cohen-Smith describes Healthfirst's VBID choices. This coverage is part of Payer Week—five days of in-depth coverage spotlighting the significant roles and contributions of health insurers.
Three business model differentiators
Cohen-Smith identifies three factors that made choosing social drivers easy:
A hyperlocal approach;
Already strong chronic disease management programs; and
High member retention.
Healthfirst hires people who live, work, and play in the communities it serves (New York City, Long Island, and Westchester, Rockland, Sullivan, and Orange counties). Cohen-Smith reports that the plan also has the largest field sales team in the area.
These tight relationships include providers and members.
Healthfirst is sponsored by downstate New York's leading hospital systems and, the plan reports, has been a pioneer of the value-based care model for nearly 30 years. Its close hospital relationships have generated strong outcomes—making it possible for the plan to choose SDOH over chronic disease for its VBID model focus. (For VBID program details, see HealthLeaders' companion article)
Member retention is another Healthfirst advantage. Healthfirst has members in Medicaid, Medicare Advantage (MA), Long-Term Care, Qualified Health, Essential, and individual and small group plans. It also has a large dual-eligible population.
"Our Healthfirst members tend to stay with us for a very long time," says Cohen-Smith. "This gives us exceptional insight into what people of New York need. This not only fits with our mission but helps members see the value of our benefits over time and how to access them. We take good care of them."
Partnering, listening, pivoting
These differentiators connect to Healthfirst's most significant VBID learnings so far:
Having the right partners (providers, vendors, operational structures) to deliver an innovative program that is easy for members to understand.
Listening to members—before, during, and after VBID model launch.
The right partners ties back to Healthfirst's hyperlocal approach.
And while many stakeholders stress member feedback, you can hear its importance in Cohen-Smith's voice: the value and impact of three years of VBID process improvement.
"Having our ear to the ground has been critical," she says, stressing again how a hyperlocal approach allowed Healthfirst to adjust communications and education about VBID benefits.
Expansion and leverage: The benefits of being nimble
Healthfirst's initial VBID focus was an OTC Plus Card. Eligible members can use the card at neighborhood pharmacies, grocers and other businesses to pay for everyday expenses like healthy foods and over-the-counter items.
"The heathy foods program is especially challenging in New York City because most grocery stores don't belong to large chains; they're the small local bodegas on the corner."
The ability to be nimble helped Healthfirst expand OTC Plus to help with utilities and now internet access.
Healthfirst added the latter by keeping its ear to the ground more broadly. After New York introduced a program that made internet more affordable statewide, Healthfirst added the benefit to its OTC Plus Card.
"It was a great time to lean into digital access, given the growth of telehealth, and increased loneliness during and after the pandemic," says Cohen-Smith. "Because we're a regional plan, we could act quickly. Healthfirst was the first plan in the state to offer the benefit and others have followed."
Healthfirst is one of only two MA plans that have chosen SDOH as their focus for the CMS VBID model. Cohen-Smith acknowledges that demonstrating outcomes remains challenging, even with Healthfirst's advantages.
"Two and a half years into VBID, it's still hard to show that the value we thought we'd get is in fact happening. SDOH results just take longer."
The answer is both as payers benefit unevenly from CMS' fine turning.
If you want a front-row seat to the Medicare Advantage (MA) Star Ratings controversy, grab your popcorn and consider the ongoing war of words between healthcare industry veterans.
In one corner, those who defend the program: “MA has an extensive, well-structured, and strongly administered five-star system.”
In the other, those who believe the Emperor Has No Clothes: “[T]he Five-Star program, while well intended, primarily creates a ‘performing to the test’ result rather than solid and important quality improvements in outcomes.”
With 2023 plan results lower than they’ve been in years, HealthLeaders’ timely examination of Stars includes our exclusive interview with Healthmine Senior Advisor and Stars program expert Cherié Shortridge. This feature is part of Payer Week—five days of in-depth coverage spotlighting the significant roles and contributions of health insurers.
CMS fiddles, plans burn
Just how challenging was 2023? HealthLeadersreported that 51% of MA plans with prescription drug coverage (MA-PDP) had an overall rating of four stars or higher. There was also a 30% decline in the number of five-star plans (from 74 to 57).
Seeking Alpha reports that “only four publicly traded managed care providers . . . achieved a score of four stars or higher for their largest MA contracts”—Alignment Health, Elevance Health, Humana, and UnitedHealthGroup.
Among privately held payers, Kaiser Permanente maintained its consistently high Star Ratings in 2023. All Kaiser’s plans received at least a four-star rating. Its California, Colorado, Georgia, Hawaii, and Mid-Atlantic plans received five stars, most for more than a decade.
In contrast, Seeking Alpha continues, only 21% of Aetna plans received a four-star rating or higher. This near-total reversal from 2022—when 87% of its plans were so rated—will result in a projected $800M–$1B net income loss for 2024 by Aetna’s parent company, CVS Health.
Past performance is no guarantee of future results
Could the poor outcomes have been prevented? Yes, no, and maybe.
The 2023 ratings year included multiple CMS methodology changes:
Guardrails (upper and lower limits) that define a plan’s measure-specific Star Ratings;
Elimination of “better of” provisions, which allowed plans to choose current or past data for most 2022 measures; and
Removal of performance outliers in select ratings calculations
“The codified and proposed changes over these next few years are more than we’ve seen since the beginning of the Stars program,” says Shortridge.
And while some may argue that 2023 Star Ratings were not truly performance related due to these changes, that’s not entirely accurate. Shortridge agrees.
"Even before the public health emergency (PHE), Stars ratings had been stable for three-four years. Throughout the PHE, plans benefitted from the ‘better of’ scoring methodology for most measures,” says Shortridge. She adds: "Stars is now measuring real rates again."
While the “better of” change gave plans a Get Out of Jail Free card, the choice was still based on performance, still impacted by COVID-19.
The outlier provision means that "poorly performing plans will no longer bolster the ratings of other plans."
The answer? Every MA plan benefits from an enterprise-wise Stars strategy. Most plans also struggle with significant methodological changes, including scoring interdependencies that impact performance regardless of a payer’s tactics.
Shortridge adds: “CMS provides forewarning of upcoming changes, but it was still hard to prioritize with so many other competing priorities.”
Everything is relative
The outlier provision reflects the relativity aspect of Stars: ratings components that depend on other factors. While leading plans have lost the outlier bump, they still earn a “reward factor” (as high as 0.4 stars) for consistently high performance over time. The reward factor makes it more likely that 5-star plans will stay that way—a kind of compound of interest effect.
Something else that’s relative? The annual average Star Rating.
Before 2023, Star Ratings had climbed steadily over time. Just as the Dow Jones has shattered one unthinkable milestone after another, the average rating reached 4.37 Stars in 2022—“an all-time high in the program’s 12-year history” per McKinsey.
This was also the first year that CMS applied new quadruple-weighted customer experience scoring to Stars (sourced Consumer Assessment of Healthcare Providers and Systems [CAHPS] data).
“There is a heavy weight on CAHPS, but look at the questions: Did you get the appointment you needed? Did your doctor have your medical records at your visit? Did he or she help coordinate your care?” says Shortridge. “This isn’t about health plan management. It’s about the relationship between the member and their provider and access to care.”
MedPAC still isn’t happy
Just as likely as a new Stars “best” is a consistent Stars “worst”: the program’s ongoing flaws.
Between 2016-2018, the same sentence appeared in MedPAC’s annual Medicare report to Congress: “[T]he Commission has been increasingly concerned that Medicare’s approach to quality measurement is flawed because it relies on too many clinical process measures.”
MedPAC has repeated a version of this statement since at least 2015, including 2023: “Over the years, the Commission has determined that the QBP [Quality Bonus Program] is flawed and does not provide a reliable basis for evaluating quality across MA plans in meaningful ways; plans have also received unwarranted bonus payments under the QBP system.”
Star Ratings serve two gods
Can Stars overcome these copy-paste critiques? The answer is uncertain and may be rooted in the program’s dual purpose: consumer marketing and plan payment.
So notes a 2015 brief by the National Health Policy Forum Issue Brief, which adds: “This dual function means that CMS must be responsive both to beneficiaries who want transparent results relevant to their purchasing decisions and to health plans that have concerns related to differences in populations and their ability to influence the performance being measured.”
Stars has two other functions: support Medicare financial stability and quality.
“CMS projects the new and proposed changes will result in billions of dollars in Medicare cost savings,” says Shortridge. “The right care at the right place at the right time is just good business.”
Callout: Bonus Content: 8 expert tips for top Stars performance
Don’t treat Stars as an event; maintain an ongoing enterprise-wide strategy.
Maximize existing, internal data, such as complaints, grievances, and appeals
Deploy key operational teams, including care management, disease management, call centers, and other customer-facing departments.
Use supplemental benefits to improve performance across multiple measures.
Make patient experience a core differentiation strategy.
Identify and diagnose at-risk measures.
Deploy metric-specific initiatives.
Create and increase programmatic quality investments, such as call campaigns
The first look at a preview of HealthLeaders Payer Week, five days of in-depth coverage and exclusive interviews.
“In quantum mechanics, a particle can exist in multiple states at the same time. Once the particle is observed it ‘picks’ one of these states . . . [and] the results change” — Mindful Leader.
Healthcare is not quantum mechanics. But multiple states do exist simultaneously across the industry, guided by competing groups: providers, pharmaceutical companies, government, tech startups—and payers.
Payers have not “picked” a single state in which to operate. They are also providers, third-party administrators, health services companies, pharmacy benefit managers, data and analytics firms, innovation incubators and investors. The list goes on and it has resulted in a changing healthcare landscape.
Medicare Advantage in the Hot Seat: Challenges and Opportunities
Payer operational diversity will be on display during HealthLeaders Payer Week—five days of in-depth coverage spotlighting the significant roles and contributions of insurers. Our week-long exploration, Medicare Advantage in the Hot Seat: Challenges and Opportunities, will include:
Medicare Advantage's tremendous market growth and expansion
The sticky business of Medicare Advantage prior authorization and marketing
The intersection of benefit design and provider performance
Rising drug costs and Medicare Advantage health plan counter-moves
The Star Ratings program evolution
Below is some of what you can expect for Payer Week.
Preview 1: Drug cost controls, payer shell games, and market collapse
“Meet the IRA,” writes Dr. Adam Fein, CEO of Drug Channels Institute. It’s an innocent enough introduction to the Inflation Reduction Act, which requires manufacturers to negotiate drug prices with the Medicare program and MA payers.
But Fein believes lower drug prices will come with a high price tag. This includes the potential collapse of the standalone Part D market. The cause? Payers steering members toward plans with combined medical-pharmacy benefits and integrated cost management advantages.
The Payer Week drug pricing brief will include an exclusive interview from CareFirst BlueCross BlueShield VP of pharmacy management, Mandi Poplawksi.
Preview 2: The Star Ratings he said, she said
The performance-benefits mashup isn’t the only marketing strategy that Medicare Advantage payers use. CMS’ Star Ratings are another. And a lucrative one, if you know how to play the game and have a five-star plan you can market year round.
Some believe star ratings genuinely reflect Medicare Advantage plan quality. Others believe the program “harbors an arbitrage game in which CMS consistently overpays MA plans with no demonstratable clinical benefit to patients.”
One fact spans both views: 2023 was a tough year for plans as a trifecta of CMS methodology changes sank Star Ratings.
The Payer Week feature will spotlight winners and losers, why a Medicare oversight group can’t stop ringing Star Rating alarm bells, and top tips from industry experts on how payers can improve performance.
Preview 3: What you don’t know about the Medicare Value-Based Insurance Design program
Only a few CMS alternative payment models have included Medicare Advantage plans and the value-based insurance design (VBID) program is one of them. From 2017-2023, VBID has grown from eight to 50 states and all U.S. territories and from nine to 50+ MA Organizations as of 2023.
Among value-based care (VBC) models, VBID is less controversial than direct contracting and has maintained a lower profile than the Medicare Shared Savings Program that put ACOs on the map.
Many Medicare Advantage plans have participated since the beginning (or as early as they could) while others—large players like Centene—have just entered. Why? How does VBID compare to home-grown payer models? How do plans balance the demands of multiple VBC programs? And what’s the status of the VBID-X plan design template?
The HealthLeaders Payer Week brief will address and feature an exclusive interview with Healthfirst’s SVP of Medicare, Jen Cohen-Smith.
More special coverage
Outside of Payer Week, HealthLeaders features exclusive leadership profiles for our series The Exec. Recent payer interviews have included:
Leading industry voice Dr. Sachin Jain, CEO of SCAN Health Plan and its parent company, The SCAN Group
Geisinger Health Plan president Kurt Wrobel, whose plan and parent company Geisinger Health will be acquired by Kaiser Permanente if the deal is approved
The president of Care Solutions for Evernorth Health Services, Joan Harvey. The industry veteran shared the top strategic priorities for Cigna’s health services division.
Clover Health CTO-turned-president-turned CEO Andrew Toy. Struggling of late, Clover represents a new breed of payers leading with tech and business model innovation.
See HealthLeaders’companion article for previews of other Payer Week features and briefs on the state of Medicare Advantage expansion, prior authorization, marketing, and benefit design.
Pushback on DEA regulations is measured by medication coverage trends that are improving but still lag in many areas.
It was the early days of the AIDS epidemic, and the government wasn't responding fast enough. As depicted in the HBO Films version of And the Band Played On—based on Randy Shilts' poignant account of HIV inaction in the 80s—CDC researcher Dr. Don Francis exclaims that when a house is engulfed in flames, you don't wait. "You grab the first hose and start putting out the fire."
Opioid use disorder (OUD) is also burning out of control—an epidemic that the pandemic exacerbated but also lent relief to. How? By expanding telehealth access to OUD treatment and medications, including buprenorphine.
This year has brought more threats and opportunities for those suffering from OUD. And while some outcomes are uncertain, others are clear, based on a new payer buprenorphine coverage study from Health Affairs.
The common thread is access.
The DEA flinches
The US Drug Enforcement Agency (DEA) has had a change of heart.
In response to "a record 38,000 comments," the agency will continue waivers that allow provider to prescribe controlled substances via telehealth (v-prescribing) and without a prior in-person visit. This gave millions increased access to buprenorphine and other drugs. Buprenorphine helps reduce opioid cravings and withdrawal symptoms.
But in the February 2023 rule that received so much criticism, the DEA proposed to end the waiver with the end of the COVID-19 public health emergency. If it had finalized the rule, in-person visits would again be required for initial controlled substance prescriptions and for buprenorphine refills, effective May 11. Amid backlash, the DEA has extended that date to November 11.
HealthLeaders has covered the proposed rule, its pause, and the broader, dismal state of OUD and substance use disorder (SUD) treatment and reimbursement in the U.S.
AHIP's response to proposed rule
AHIP's response was among the 38,000 that the DEA received.
In its letter submitted during the proposed rule comment period, the national payer advocacy group noted: "While we appreciate the Drug Enforcement Administration's (DEA's) efforts to balance patient access with patient safety, we are concerned that the proposed rule may erect barriers to further innovation in health care and offer several recommendations for consideration."
The AHIP letter, signed by organization SVP Kate Berry, continued that "telemedicine played an outsized role in behavioral health during the pandemic, with nearly a third of behavioral health outpatient visits delivered over telehealth for opioid use disorder and substance use disorder (OUD/SUD) conditions, and with rural residents even more likely to use telehealth for behavioral health conditions. That high level of telemedicine utilization for behavioral health continues even as the public health emergency comes to an end."
Payers step up—and are advised to keep going
While AHIP's response signals payer support for buprenorphine v-prescribing, insurance coverage for the OUD treatment has been a work in progress with more to be done.
Coverage for buprenorphine is the subject of a new Health Affairs study. The results were mixed. On one hand, there was a notable increase in coverage for the immediate-release formulation of buprenorphine from 2017-2021:
Formulary inclusion — The number increased from 95.4% to 98% among Medicaid payers, 91.3% to 94.7% among Medicare Advantage (MA) payers, and 93.4% to 97% among commercial payers.
Prior authorization (PA) — The percentage of formularies without PA requirements increased to 74.4%, 84.9%, and 94.6% among Medicaid, MA, and commercial payers, respectively.
Quantity limits (QL) — Most Medicaid (97.2%) and commercial (91%) formularies do not impose QLs, but MA is the exception with more than 50% retaining QLs as of 2021.
But this is for the older, immediate-release formulation. Coverage of the newer, extended-release buprenorphine has also increased but lags well behind. The Health Affairs study notes that "only 46 percent of commercial plans and only 19 percent of Medicare Advantage plans cover the extended-release formulation." In contrast, most Medicaid formularies do include it but with 37% requiring PA.
Benefits of the extended-release version include fewer doses (monthly injection versus a daily prescription) and clinician involvement, which can address adherence barriers and medication diversion/misuse, per the study authors.
"Almost all plans covered immediate-release buprenorphine in 2021, with a general trend of decreasing prior authorization requirements and quantity limits since 2017. In contrast . . . only 46 percent of commercial plans and only 19 percent of Medicare Advantage plans [are] covering this formulation."
Shifting access burdens to patients
The Health Affairs authors advise policymakers to "shift their attention to extended-release buprenorphine," adding: "State lawmakers could help address these barriers by mandating that insurers include extended-release buprenorphine on their preferred drug lists."
AHIP expressed a similar concern over OUD buprenorphine and broader treatment barriers in its DEA rule response.
"Our collective experience has demonstrated that telemedicine is an important health care innovation. Telemedicine's value as a modality is supported by recent data—it is a cost-effective, convenient means of delivering high quality care, particularly to traditionally underserved areas and can expand access to care and reduce disparities, especially for rural populations where there is limited access to in-person care."
AHIP continued: "We are concerned that the proposed rule shifts the burden of seeking care to the patient, which is counter to the goal of increasing access to needed care for underserved populations, especially given health care workforce shortages which can result in longer times to get in-person appointments."
The healthcare industry veteran reveals Evernorth's top three priorities and how her unique experiences inform her leadership.
Harvey's focus? Service, community, and whole health—lessons she learned from an early age.
Joan Harvey's leadership stretches forward and back. President of Care Solutions for Evernorth Health Services, she comes from a long line of pioneers and stands ready to support the next generations.
With HealthLeaders, Harvey shares Evernorth's unconventional collaboration tactics. She also explains how her multi-entrepreneurial family and 20-plus-year career in healthcare helped her understand community networks and the people who rely on them.
Health services: Translating point solutions to value
We started with the basics: How does Evernorth define a health services organization?
"Our definition would be, how do we create an integrated, seamless solution for our customer so they understand how the different services work together for their specific journey? That customer includes that traditional healthcare consumer, employers, and other health plans."
For Evernorth—the health services division of The Cigna Group, created after its merger with pharmacy benefit manager Express Scripts—integration means putting pharmacy at the front end of managing chronic illness. And asking the right questions.
"How do I get access to care? How do I understand my condition? How do I work with providers from a holistic approach?" poses Harvey. The answers include proactivity, client needs clarity, and value delivery.
"In our fragmented world, you can have lots of point solutions. It's very difficult for a client to understand the overall value."
Evernorth today: "We really do have a philosophy and an open approach to partnering"
"What we want to get at, in an integrated fashion," says Harvey, "is to try to solve some of the biggest challenges in healthcare."
Here, Harvey details Evernorth's assets, including: pharmacy care solutions, analytics and insights, benefit management, and care services. The company seeks to "bring them together to predict, prevent, and support complex treatments while making access to care easier."
Harvey adds: "At the highest level, we really do have an open approach to partnership. It allows us to bring together the best minds to accelerate innovation."
These partnerships include Kaiser Permanente and Oscar Health—payer collaborators that historically were strictly competitors. Is there a degree of difference in how Evernorth navigates these new relationships? Harvey says yes.
"To solve the big problems in healthcare, we have to work together. Large organizations are starting to think about how we align our knowledge, our assets, and our understanding of consumers to solve not only fragmentation but access."
Evernorth's big three
Harvey gives the impression of a team that has its eyes on the same prize.
'We look at what is really front and center for our customers, our employer health plan clients and our government support areas," she says.
Evernorth's three front and centers are:
Accessible, affordable high-quality care;
How that care functions in an environment of fragmentation; and
How outpatient mental health can yield overall savings
Take the latter, mental health. A 2022 Evernorth study of 200,000 customers published in JAMA Network Open found that even a few routine outpatient behavioral health sessions can impact total cost of care.
Patients with newly diagnosed mental health and substance use disorders who completed at least one outpatient visit saved up to $2,565 in medical and pharmacy savings in the 15 months after diagnosis (e.g., via preventable inpatient stays and ER visits). Results continued 27 months post diagnosis with savings up to $3,321 compared to those without treatment.
An Evernorth spokesperson notes that this is a great example of how the health services company links a specific high-cost condition to a seamless, connected solution across the entire spectrum of care.
Family history part I: Colorado steakhouses and OPEC
"My father was a restauranteur, and I grew up working in his restaurants," shares Harvey.
"He had quite a command and was also very, very involved in the community. Understanding what kind of experience customers wanted was one of the biggest lessons I learned from him."
She adds: "In healthcare, people are the service. Every day, our clinicians are executing and delivering programs that are helping millions of people live better lives. If we can create a better environment where people understand their network, their benefits, then we can ensure that they are maximizing the financial opportunity to get access to care."
Harvey's lessons come from a unique corner of America and at a very specific point in time.
"We were in the western part of Colorado in the 80s—the OPEC, when Exxon brought in tens of thousands of people and created these mini cities around Grand Junction to build the first phase of oil shale extraction [fracking]. And so, my father built up all different kinds of restaurants."
It didn't last. Exxon abandoned its Colony oil shale project in 1982, stating it could not "prudently continue the Colony project alone."
"Within six months, all of those people left," says Harvey. "The infrastructure that was there to support them dried up and a lot of people went bankrupt."
But not Harvey's father, who had no intention of continuing alone either. He pivoted with his community.
"Because he had spent so much time understanding the community and supporting the businesses there, we were able to shift the business and say, 'Okay, we're not going to be serving executives anymore. We're going to focus on what the people here need and what we can provide.'"
Family history part II: Heart surgery and mental health
"The big lesson for me," says Harvey, "was on the dynamics of economics and the outside world: how you can be resourceful to support teams and partners inside your community, how you can do good by them as you adjust your business."
And her family's entrepreneurial lessons weren't limited to restaurants.
"I grew up in a very medical family. My grandfather and grandmother were big in the founding of open-heart surgery and in mental health," says Harvey. She's referring to Dr. Henry Swan, who pioneered heart surgery using hypothermia—an innovation that expanded the types of cardiac procedures that are now available. And to Mary Fletcher Gaylord, a mental health advocate at the local, state and national level, dating back to the 1950s.
"I have been into whole-person health my entire life. You have to bring the mind and body together," says Harvey, adding: "So in terms of how to run a business, I think about communities. I knew I didn't want to be a doctor but I really wanted to give back."
Like her father. Like her grandparents.
"Your job is to pay it forward—to do something better and make it a better system. My grandparents did that and that passion has been a driver for me since I first started in healthcare."
The study was based on new data made available through the federal Hospital Price Transparency initiative. While the study authors note that this data could help employers bargain for premium savings from their health plans, others—including HealthLeaders—see broader possibilities.
How employers can use price transparency data
"Employers can also use this new research to better understand the total cost of care across various plans and markets and determine where they might have opportunities to control costs."
Azar mentions total cost of care [TCC] with caution: "It is not accurate to evaluate the price of anything by looking at the individual parts."
To TCC management, HealthLeaders adds other cost-control strategies that could make of use transparency data—part of our ongoing coverage of the employer as healthcare payer. The strategies include direct contracting with providers or ACOs and defined contribution tools like Individual Coverage Health Reimbursement Arrangement (ICHRA), where companies give their employees a pot of money to buy their own coverage and help pay for deductibles and coinsurance.
The challenge and opportunity of more data
"There is a lot of work yet to do with these data," says Azar and every professional who has ever tried to turn Big Data into Big Solutions.
Other insights from the Health Affairs study include:
Health plans with more than 71% commercial lives share pay hospitals nearly 15% less than in other markets.
The difference is lower—7%—in less-concentrated markets.
In the most competitive health plan markets, the difference is higher with for-profit hospitals versus nonprofits and government-owned hospitals.
In some markets, providers are more concentrated and have the upper hand in contract negotiations. In addition to cost transparency and other data, employers can use the Herfindahl–Hirschman Index (HHI), which measures how concentrated markets are in general based on who does business there.
Market realities and myths
The HHI definition and other Health Affairs analysis include tidbits worth paying attention to.
HHI is based on "the market share of each firm competing in the market," emphasis added to highlight healthcare's worst-kept secret: payers and providers are competitors. The prize? The healthcare dollar. Employers compete too, making the impact of market concentration on price and the use of cost transparency data even more vital.
As the Health Affairs study noted, the data "revealed considerable variability in procedure pricing across the country…Large employers have been aware of this for a while as they see the differences in employee health costs across the country."
Health Affairs Forefront has noted that "well-functioning markets should not have the amount of price variation observed within and between commercial markets in the US.
As employers search for new tools, the question looms: where exactly are these well-functioning markets in the U.S. economy, past or present? Banks continue to fail due to oversight errors, just as failed IPOs spring from valuation errors.
"Employers do not purchase health care services in an efficient market," says Azar. Another reason why new pricing transparency data will help them parry-and-thrust with their other "healthcare competitors."
The passing of the healthcare buck
If all of this sounds like a game of hot potato, it is: when the healthcare buck gets passed, who pays the bill and how much?
Some interesting moves by employers include the fees they charge the general public to help pay for their employees' healthcare (e.g., restaurants that add an extra charge to your avocado toast bill). Some interesting moves upon employers include directing insurance members to their Employee Assistance Programs before their paid benefits to direct resource use.
There are just a few additions to the already complex chain of supply and demand.
Returning to the Health Affairs study, Azar notes: "Employers have long desired an ability to impact the supply-side of health care services.
In addition to tacked-on fees and data-powered negotiations with payers, employers can also use the new transparency data to negotiate prices directly and at the point of care.
Darrell Moon, a Forbes Business Councils Member, suggests that employers pay providers upfront to get the cash-discount for their employees' procedures .
All of that is visible is the new data, says Moon. He downloaded the gross and negotiated prices for a procedure at one of his large local hospitals and reported the following: "If I'm admitted to that hospital for that procedure and present my employer-provided insurance card, the average price is discounted by 30%. On the other hand, if my employer pays up front through a cash pay strategy, the discount is 75%. By studying the hospital's chargemaster across all procedures, I found this same level of discount applied to almost all procedures."
Moon adds: "The point is, we live in a new world thanks to new regulations. Employers can now hold the healthcare system accountable and, even more importantly, be better stewards of their employees' money."
Addressing data surprises is part of CVS's mental health support strategy for customers, including its Aetna health plan members.
You know an issue needs attention when it has a designated month.
May is Mental Health Awareness Month and viewing it that way may sound pessimistic. But a realistic picture of American behavioral health is needed to improve it.
CVS Health adds to that picture via its recurring survey of mental health perceptions. The retailer's sixth survey since April 2020 reveals nuances across age groups, treatment preferences, and between providers and their patients.
In an exclusive interview with HealthLeaders, CVS Health's Cara McNulty, DPA, president of Mental Well-Being & Behavioral Health, added insight to the data and its biggest surprises.
Topline results: Perception versus reality
The latest CVS Health data is based on a national online Harris survey conducted March 7–24, 2023. Harris polled 3,400 people over the age of 18, as well as physicians and pharmacists. Respondents were those who had previously agreed to participate in CVS surveys. Age breakdowns included: Gen Z/Young Millennials (18-32 years), Older Millennials (33-40), Gen X (41-56) and Boomer+ (57+ years of age).
Gaps between Boomers and Gen Z are no surprise. But individual differences might be, such as how accurately individuals perceive their own mental health needs at any given time.
Gen Z concerns are higher than the national average. While more than two in five Americans (42%) expressed concern about their mental health, that number increased to six in 10 (60%) among respondents aged 18-32.
Physicians report 4x greater declines in patient mental health than their patients. One in 10 Americans (14%) said their mental health had declined since 2022, but their providers don't agree. Nearly six in 10 physicians (56%) believe their patients' mental health has gotten worse.
Worried for others, but not seeking self-help? Two-thirds of survey respondents (67%) said they knew a lot of people with mental health struggles. But only 12% regularly see a mental health professional themselves.
The reasons for the disconnects—between providers and patients, patients and "other people"—are likely varied but perhaps not as unexpected as they seem.
McNulty—a 25-year healthcare veteran—shares her own experiences.
"Often we assume that people know what they're thinking and feeling. But most of us have no clue. Even with my own anxiety, I didn't have a clue."
She adds: "We are feeling the impacts of COVID, of pandemic socialization over the past three years. We're perhaps even immune to it. But physicians continue to see the impact and disruption when patients come in to see them and for reasons other than mental health."
Generational data differences
The CVS Health/Harris poll data showed that 95% of Boomers believe society should take mental health and mental illness more seriously. This is compared to 83% of Gen Z.
This also surprised McNulty.
"The Boomer age group felt that mental health was as important as physical health, which in the past hasn't been case," she notes. "This is not a population that grew up talking about this, but they see with the pandemic how their own mental health and that of their family and loved ones has been affected."
Other generational gaps involved technology, with notable contrasts between Gens Z and X:
Technology for mental health information. Nearly 30% of Gen Z respondents stated they rely on technology for mental health information, the most of any age group.
Technology for mental health access. More Older Millennial respondents, however, appear to use technology to actually access care—85% agree that digital health has made mental health services more accessible.
The social media effect. Gen Z and Boomers also differ in the belief that social media has negatively impacted their mental health—58% versus 22%, respectively.
How CVS applies the data, including for Aetna members
CVS applies the Harris poll data to understand and address the country's diverse mental health needs—for all its customers and for the subset who have Aetna coverage. CVS Health acquired Aetna in 2017.
"We are casting a wide net to ensure people get help at the point of care," says McNulty, who detailed CVS' mental health services in a press release associated with its survey data.
CVS' mental health virtual visits have exploded, from less than 200,000 in 2019 to approximately 30 million by the end of 2022. More than 1,100 CVS MinuteClinic locations also offer depression screenings.
The screening includes the two-item Patient Health Questionnaire (PHQ-2), which asks: "Over the last 2 weeks, how often have you been bothered by the following problems? 1. Little interest or pleasure in doing things. 2. Feeling down, depressed or hopeless."
Based on the results and the person's health plan, CVS Health offers support at the individual and population health levels. CVS' Resources for Living Team connects Aetna members to their employers' resources first, then to plan benefits—a triage approach that reflects shifts in who pays and provides services and in what order.
"For Aetna members," McNulty notes, "we can go a step further. Taking what we are seeing in claims, trends, and environmental factors as an overlay and then looking at predictive factors to deploy services that are age specific, clinically sound, and culturally appropriate."
As a specific example, McNulty returns to that surprise Boomer belief in the importance of mental health and its implications.
"With this population, we make sure that Aetna solutions include mental health needs during situations like joint replacement. We're not waiting for someone to be in crisis."
She adds: "If a customer is not an Aetna member, we still support them. We just don't have details on what their plan sponsor resources are. If they are uninsured, we help connect them to local resources."
"As an industry, we haven't always felt comfortable addressing the mental health side. At CVS Health, we take it as an imperative. That some people are half served, half supported—that's absolutely not good enough. No one needs to suffer, no one needs to do this alone."
"Focusing on this work every single day is the right thing to do."
From accrediting organizations to payers, stakeholders seek often-illusive intel on healthcare's most vulnerable populations.
The National Committee for Quality Assurance (NCQA) has announced its new Race and Ethnicity Stratification Learning Network — “a free, interactive, online tool that offers data and best practices to help health plans improve how they collect race and ethnicity data on their enrollees” with the ultimate goal to “advance health equity through measurement.”
A spokesperson for NCQA stated that the Network provides a first-time look into health plan performance variation trends based on race and ethnicity, and best practices for plans to collect, measure, and report health equity data. The trend data originates from 20 million enrollees of 14 health plans that reported select HEDIS measures results stratified by race and ethnicity.
In a press release for the announcement, the NCQA’s Dr. Eric Schneider — EVP of the organization’s Quality Measurement and Research Group — stated: “Organizations are devoting substantial resources to support health equity, and many are eager to learn how to collect and leverage data to narrow health disparities.”
In an exclusive quote for HealthLeaders, Keirsha Thompson, MSW — NCQA Manager, Performance Measurement of NCQA — added: “What’s exciting about this is that no one has ever seen these data in one place before, and it’s inspiring that the information can be used to support quality improvement to data and help reduce health disparities.”
Thompson adds: “Network findings reflect over 100 contracts across Commercial, Medicaid, Medicare, and Exchange insurance plans. We want health plans to use the Network to feel empowered and know that they can make tangible changes to improve the data they rely on and ultimately work toward narrowing health disparities for their member populations.”
The NCQA is a private, nonprofit organization that accredits, certifies, and recognizes the performance of multiple stakeholder groups including health plans and physician practices. The organization’s Healthcare Effectiveness Data and Information Set (HEDIS®) is the healthcare industry’s most widely used measurement tool.
Just over 10% participation
The 14 health plans and 20 million members reporting race and ethnicity-stratified data for five HEDIS measures is a start. But there is still a long way to go for race and ethnicity data collection to become part of how healthcare does business.
More than 190 million members are represented by plans that report HEDIS overall. Those that report stratified data represent just 10%.
Heath plans have sought to improve their race and ethnicity data collection for years, a chronically difficult task. People of different races and ethnic groups can feel that this data will be used against them by a healthcare system that they already distrust — one that underserves them and even contributes to their poorer health outcomes.
Attacking the problem from multiple angles
Multiple efforts are underway — through data and measurement — to create a healthcare system that at the very least provides equal care for everyone, with the highest aim of producing equal outcomes.
In addition to its new learning network, the NCQA introduced new Health Equity Accreditation (HEA) and HEA Plus programs in recent years — also focused on HEDIS race and ethnicity reporting and adding standards for “organizational diversity, equity, inclusion and reducing bias” as well as data collection for sexual orientation, and gender identity (SOGI).
Payers have launched their own efforts, including plans in the Blue Cross Blue Shield Association (BCBSA). The BCBSA has launched a National Health Equity Strategy, in part to grow self-reported patient data that is more granular and regularly updated on race, ethnicity, and language (REL) as well as social needs and SOGI.
Blues plans are embedding these efforts in their Alternative Quality Contracts (AQC), one of the first — and it could be argued more successful — commercial value-based reimbursement models in the U.S.
In a prior exclusive with HealthLeaders, BCBS-MA CMO Sandhya Rao noted that "data gaps and the lack of race data have been a challenge for years." The plan is now nearly 18 months into an equity initiative that incentives physicians to close care gaps and uses HEDIS data to identify the most critical disparities among members who are Asian, Black, and Hispanic.
All payers must participate
In addition to commercial payers, CMS is doubling down on health equity as a component of not only data collection and measurement but payer and provider reimbursement.
Encouraging and incentivizing health equity have been a part of every annual CMS rule governing Medicare, Medicare Advantage, Medicaid, and ACA plan operations and payment.
The agency’s annual proposed marketplace rule (Notice of Benefit and Payment Parameters) seeks to improve disparities through expanded access and coverage and builds on last year’s rule which had specific proposals for health equity-related data collection and standardization.
In its annual Medicare hospital inpatient prospective payment system (IPPS) rule, CMS has proposed 15 new health equity categories that would impact fiscal year 2024 hospital payments. The agency also wants to add social drivers of health (SDOH) factors to three ICD-10-CM diagnosis codes that would incorporate homelessness as a complication or comorbidity.
