This Week in Managed Care: October 26, 2018

Governors gain more power over health coverage, the marketplace portal suffers a breach, and more healthcare payments are tied to risk.

Welcome to This Week in Managed Care, I’m Laura Joszt.

Altering ACA Exchange Offerings

The Trump administration this week gave governors the power to overhaul section 1332 waivers under the Affordable Care Act, which could allow states to approve plans that don’t meet all the coverage requirements in the law.

While CMS Administrator Seema Verma said the new policy would allow for more choice and competition, one expert said the change would bring high profits at the expense of consumers.

Said Stan Dorn of Families USA, “This guidance slashes the legs out from under the comparable coverage requirement by saying that, as long as comparable coverage is theoretically available, competing plans, operating by completely different rules, can swoop in, pick up all the good risks, and stash away huge profits, exempt from [medical loss ratio] requirements.”

The guidance lets states divert federal dollars for premium tax credits to serve people with incomes below the poverty line and keep them out of Medicaid. States must still serve the same number of people, but those in association health plans and short-term plans with less coverage now count.

ACA Portal Breach

CMS disclosed a breach in the portal that agents and brokers use to assist consumers signing up for health coverage under the Affordable Care Act.

Officials first noticed suspicious activity October 13 and declared a breach on October 16. The agent and broker portal was disabled so federal investigators can find out what happened. Files for about 75,000 individuals were affected.

Verma said, “We are working to identify the individuals potentially impacted as quickly as possible so that we can notify them and provide resources such as credit protection.”

The breach comes as CMS hopes to expand the role of insurance professionals in helping consumers sign up for coverage starting November 1. The Trump administration has reduced the budget for navigators from independent consumer groups, saying they were not enrolling enough people and the effort was not cost-effective.

APM Progress

About one-third of all US healthcare payments in 2017 were tied to alternative payment models (APMs), with the rest still tied to fee for service, according to a new report.

The Health Care Payment Learning and Action Network found the following:

• Of the fee-for-service payments, 41% had no link to quality and value, while 25% had a link to quality and value.
• Over the past 2 years there has been a 17% increase in spending tied to models with shared savings, downside risk, and population-based payment.

More choices are needed to keep up the trend, according to Mark McClellan, MD, PhD, a co-chair of the Network’s Guiding Committee, who said: “While we celebrate the increase in overall APM adoption, we also know further progress on payment reform will be important to ensure healthcare dollars flow through models that have more risk.”

Specialty Pharmacy Pipeline

More competition is expected in the pharmaceutical sector in 2019, and biosimilars will be a big part of the story, according to an expert who kicked off the fall meeting of the Academy of Managed Care Pharmacy. Aimee Tharaldson, PharmD, of Express Scripts said specialty pharmacy accounted for 41% of drug spending in 2017 and that share should reach 50% by 2019.

Tharaldson said the legal challenges that have kept some key biosimilars from reaching US customers will start to ease, and she foresees a June 2019 launch date for Ogivri, a biosimilar for Herceptin, and a July 2019 launch for Mvasi, a biosimilar for Avastin.

See the full coverage of AMCP Nexus.

AJMC^® will also cover Psych Congress this weekend.

Risk Management in Oncology

Oncologist Barbara McAneny, MD, is serving this year as president of the American Medical Association at time of great change in her field.

In an exclusive interview with The American Journal of Managed Care^®, McAneny spoke about the challenges of meeting cost-saving targets under CMS’ Oncology Care Model. She explained that practices that fall short of cost-saving targets may leave the program, because managing risk is not something entirely within their control

Watch the interview.

McAneny will be the keynote speaker next month at Patient-Centered Oncology Care^®, AJMC^®’s annual multistakeholder meeting featuring payers, providers, and patient advocates.

Join us November 16 in Philadelphia.

For all of us at the Managed Markets News Network, I’m Laura Joszt.

Thanks for joining us.