Datapoint: Almost Two-Thirds of Commercial Health Insurance Market Enrolled in Self-Funded Plans

September 30, 2020

Of the 193.7 million people currently enrolled in a commercial health insurance product, 36.4% are covered by a risk-based small group, large group or individual plan. The remaining 63.6% are enrolled in an administrative services only (ASO) contract.

Of the 193.7 million people currently enrolled in a commercial health insurance product, 36.4% are covered by a risk-based small group, large group or individual plan. The remaining 63.6% are enrolled in an administrative services only (ASO) contract.

Source: AIS’s Directory of Health Plans

New Manufacturing Approach May Drive Down CAR-T Therapies’ Prices

September 30, 2020

This summer, a drug called Tecartus (brexucabtagene autoleucel) became the third chimeric antigen receptor T-cell (CAR-T) therapy approved by the FDA. CAR-T therapies, which use a patient’s genetically modified immune cells to target and fight cancer cells, are a cutting-edge type of treatment that comes with eye-popping price tags, ranging from $373,000 to $475,000. However, a new report from OptumRx highlights an “industry trend to watch” that could eventually provide some relief to payers worried about how to finance CAR-T treatments.

Currently, CAR-T therapies’ high cost is at least in part attributable to the “labor-intensive and time-consuming” manufacturing process for such drugs, stated the UnitedHealth Group-owned PBM’s Drug Pipeline Insights Report for the third quarter of 2020. Essentially, T-cells are taken from a patient, treated and multiplied in a lab, and reinfused into the same patient — a completely personalized process known as autologous therapy.

By Leslie Small

This summer, a drug called Tecartus (brexucabtagene autoleucel) became the third chimeric antigen receptor T-cell (CAR-T) therapy approved by the FDA. CAR-T therapies, which use a patient’s genetically modified immune cells to target and fight cancer cells, are a cutting-edge type of treatment that comes with eye-popping price tags, ranging from $373,000 to $475,000. However, a new report from OptumRx highlights an “industry trend to watch” that could eventually provide some relief to payers worried about how to finance CAR-T treatments.

Currently, CAR-T therapies’ high cost is at least in part attributable to the “labor-intensive and time-consuming” manufacturing process for such drugs, stated the UnitedHealth Group-owned PBM’s Drug Pipeline Insights Report for the third quarter of 2020. Essentially, T-cells are taken from a patient, treated and multiplied in a lab, and reinfused into the same patient — a completely personalized process known as autologous therapy.

As the industry searches for a cheaper and more scalable way of manufacturing CAR-T treatments, a new approach known as an allogeneic process “is currently under study as one possible solution,” according to OptumRx. In this process, previously extracted and banked healthy donor T-cells are multiplied “many times over for use in many patients,” effectively spreading out the high initial manufacturing cost over multiple doses.

When asked how much the allogeneic process could reduce the manufacturing cost of CAR-T therapies, Bill Dreitlein, senior director of pipeline and drug surveillance at OptumRx, cited a 2019 study.

“Per the International Society for Cell and Gene Therapy, the cost to manufacture CAR-T using current methods is at $95,780 per dose,” he says via email. “That study also calculates the production cost using the new process would be only $4,460 per dose — over 95% lower.”

However, because manufacturing costs are only one part of the drug-pricing equation, the new allogeneic process may not actually lower CAR-T prices that dramatically, the report noted.

Tecartus’ list price is $373,000, and the wholesale acquisition costs of the other CAR-T therapies, Kymriah (tisagenlecleucel) and Yescarta (axicabtagene ciloleucel), are $373,000 and $475,000 respectively, per the OptumRx report. As of Oct. 1, 2019, CMS agreed to cover CAR-T therapies for qualifying Medicare beneficiaries, but private payers generally reimburse providers for CAR-T treatment on a case-by-case basis, industry experts previously told AIS Health.

Datapoint: Bright Health Raises Another $500M in Venture Capital

September 29, 2020

Medicare Advantage startup Bright Health scored another major venture capital investment, raising $500 million in a Series E funding round. The news comes just a few weeks after the insurer revealed its 2021 expansion plans, which will include its first foray into employer group products. Bright Health currently enrolls 153,083 people in its individual commercial products, and 5,324 Medicare Advantage members.

Medicare Advantage startup Bright Health scored another major venture capital investment, raising $500 million in a Series E funding round. The news comes just a few weeks after the insurer revealed its 2021 expansion plans, which will include its first foray into employer group products. Bright Health currently enrolls 153,083 people in its individual commercial products, and 5,324 Medicare Advantage members.

Source: AIS’s Directory of Health Plans

Experts Remain Skeptical That SCOTUS Will Scuttle Entire ACA

September 29, 2020

The Sept. 18 death of Justice Ruth Bader Ginsburg — which could tip the scales in favor of striking down the Affordable Care Act (ACA) — was hardly welcome news for health insurers during a year when a pandemic and a presidential election are already fueling high levels of uncertainty. However, industry analysts and legal experts say there are plenty of reasons not to hit the panic button just yet.

“This definitely increases the chance of the Supreme Court striking down the full ACA. But we’re going from a pretty low likelihood base,” says Chris Sloan at Avalere Health. “The odds are still really stacked against anything materially changing for the ACA.”

By Leslie Small

The Sept. 18 death of Justice Ruth Bader Ginsburg — which could tip the scales in favor of striking down the Affordable Care Act (ACA) — was hardly welcome news for health insurers during a year when a pandemic and a presidential election are already fueling high levels of uncertainty. However, industry analysts and legal experts say there are plenty of reasons not to hit the panic button just yet.

“This definitely increases the chance of the Supreme Court striking down the full ACA. But we’re going from a pretty low likelihood base,” says Chris Sloan at Avalere Health. “The odds are still really stacked against anything materially changing for the ACA.”

At issue is a case now known as California v. Texas, which Republican state officials filed in 2018 to challenge the constitutionality of the ACA. Because Congress changed the tax penalty for the law’s individual mandate to $0 via the 2017 Tax Cuts and Jobs Act, they argued, the mandate is unlawful, and if that part is unconstitutional, the whole law must go.

Until Ginsburg’s death from cancer complications, many legal observers expected that the ACA had a good shot at surviving this latest Supreme Court challenge. But if Senate Republicans are able to confirm a replacement for Ginsburg before Nov. 10 oral arguments, not one but two conservative justices would have to side with their liberal colleagues to produce a pro-ACA ruling, explains health care attorney Katie Keith.

Ultimately, “I’m still skeptical that the entire law would be invalidated; I think that would be a step too far and does go against some of the recent decisions we’ve seen on severability from this court,” Keith says. However, she adds that the loss of Ginsburg “makes it more likely that parts of the ACA will be struck down” — in particular, the so-called preexisting condition protections.

Wall Street analysts, meanwhile, appeared unconvinced that the law will be unraveled — but noted that Centene Corp. has the most exposure if that happens, given its strong concentration in Medicaid and the individual market. Credit Suisse’s A.J. Rice estimated that those two business lines make up roughly 26% of Centene’s earnings, but only 4% for Anthem, Inc., and less than 1% each for Cigna Corp., CVS Health Corp., Humana Inc. and UnitedHealth Group.

Datapoint: Biogen Suffers Another Tecfidera Patent Loss

September 28, 2020

Biogen earlier this month lost another legal battle over its patents for Tecfidera, its blockbuster multiple sclerosis drug, and will likely see multiple generic challengers in the months to come. The Delaware judge on Sept. 16 ruled in favor of Amneal Pharmaceuticals, which is developing its own generic version of Tecfidera, citing Mylan’s legal victory over Biogen in a West Virginia court in June. Mylan launched its own Tecfidera generic at the end of August. Tecfidera currently holds preferred status for 12% of all covered lives under the pharmacy benefit, growing to 54% with utilization management restrictions.

Biogen earlier this month lost another legal battle over its patents for Tecfidera, its blockbuster multiple sclerosis drug, and will likely see multiple generic challengers in the months to come. The Delaware judge on Sept. 16 ruled in favor of Amneal Pharmaceuticals, which is developing its own generic version of Tecfidera, citing Mylan’s legal victory over Biogen in a West Virginia court in June. Mylan launched its own Tecfidera generic at the end of August. Tecfidera currently holds preferred status for 12% of all covered lives under the pharmacy benefit, growing to 54% with utilization management restrictions.

SOURCE: MMIT Analytics, as of 9/23/20

Payers, PBMs Play Crucial Roles in COVID-19 Vaccine Distribution

September 28, 2020

As the pharmaceutical industry hurtles toward completing a COVID-19 vaccine, payers and PBMs have begun to draft vaccine distribution plans based on emerging guidance from federal public health leaders.

The National Academies of Sciences, Engineering and Medicine has initiated formal discussion of vaccine distribution, soliciting four days of public comment on its Sept. 1 Discussion Draft of the Preliminary Framework for Equitable Allocation of COVID-19 Vaccine.

The framework suggests three phases of vaccine distribution:

By Peter Johnson

As the pharmaceutical industry hurtles toward completing a COVID-19 vaccine, payers and PBMs have begun to draft vaccine distribution plans based on emerging guidance from federal public health leaders.

The National Academies of Sciences, Engineering and Medicine has initiated formal discussion of vaccine distribution, soliciting four days of public comment on its Sept. 1 Discussion Draft of the Preliminary Framework for Equitable Allocation of COVID-19 Vaccine.

The framework suggests three phases of vaccine distribution:

✦ Group 1a: “High risk workers in health care facilities” and “first responders”;
✦ Group 1b: “People with significant comorbid conditions,” and “older adults in congregate or overcrowded settings”;
✦ Group 2: “Critical risk workers (part 1),” “teachers and school staff,” “people with moderate comorbid conditions,” “all older adults,” “people in homeless shelters or group homes,” and “incarcerated/detained people and staff”;
✦ Group 3: “Young adults,” “children,” and “critical risk workers (part 2)”.

During a Sept. 17 session of the America’s Health Insurance Plans National Conference on Medicare, Medicaid & Dual Eligibles, AHIP Senior Vice President of Clinical Innovation Kate Berry said state and federal public health officials will likely manage the first two phases, but she added that plans should expect to get involved in the third phase.

Berry said coordination and data sharing between public officials and plans will be essential to ensuring a fair and orderly vaccine distribution process, especially since some of the vaccine candidates in late stages of development will require a booster. She also indicated that the looming medical data interoperability rules, which mandate payers, providers and government stakeholders share patients’ medical history with each other via secure data clearinghouses by January 2022, will play a role in validating which patients get vaccines at what time.

During a Sept. 15 panel at AHIP’s online conference, Sree Chaguturu, M.D., chief medical officer of CVS Health Corp.’s Caremark PBM, said he does not expect his firm to employ any utilization management tactics during the initial stages of vaccine rollout, though he later observed that PBMs and plans might eventually manage formularies to direct members away from first-generation vaccines to more effective drugs. He also observed that payers and PBMs should gather as much data as they can about the efficacy of vaccines in order to ensure that the right medication is delivered to the right populations in the future, when COVID-19 vaccines become a routine inoculation.

People on the Move

September 25, 2020

SNP Enrollment Cuts Mortality, Utilization Rates for ESRD Patients

September 25, 2020

Medicare beneficiaries with end-stage renal disease (ESRD), a costly and complex population that often has other comorbidities and sees multiple physicians, may be better served in ESRD Special Needs Plans, a type of Chronic-Condition SNP, posits a new study in Health Affairs. Researchers studied members of Anthem, Inc.’s California-based CareMore Health ESRD SNPs from 2010 to 2013, and found that those who switched from fee-for-service Medicare to a CareMore SNP experienced reduced risk of death and overall lower health care utilization compared to the FFS population (see graphics below). SNPs can coordinate member care more closely, leading to improved adherence and better health outcomes, which in turn reduces costs, asserted the study, which was supported by a grant from the Anthem Public Policy Institute. The study authors — which included employees of Humana Inc. and Anthem/CareMore — said that while additional research is still needed, CMS could consider facilitating “the sharing of best practices across SNPs and to other ESRD delivery and financing models” as it considers new models of care, including the enrollment of ESRD patients in traditional Medicare Advantage plans starting in 2021.

by Carina Belles

Medicare beneficiaries with end-stage renal disease (ESRD), a costly and complex population that often has other comorbidities and sees multiple physicians, may be better served in ESRD Special Needs Plans, a type of Chronic-Condition SNP, posits a new study in Health Affairs. Researchers studied members of Anthem, Inc.’s California-based CareMore Health ESRD SNPs from 2010 to 2013, and found that those who switched from fee-for-service Medicare to a CareMore SNP experienced reduced risk of death and overall lower health care utilization compared to the FFS population (see graphics below). SNPs can coordinate member care more closely, leading to improved adherence and better health outcomes, which in turn reduces costs, asserted the study, which was supported by a grant from the Anthem Public Policy Institute. The study authors — which included employees of Humana Inc. and Anthem/CareMore — said that while additional research is still needed, CMS could consider facilitating “the sharing of best practices across SNPs and to other ESRD delivery and financing models” as it considers new models of care, including the enrollment of ESRD patients in traditional Medicare Advantage plans starting in 2021.

NOTES: Survival curves are unadjusted. The upper and lower ranges for each curve represent 95% confidence intervals.

SOURCE: “The Beneficial Effects of Medicare Advantage Special Needs Plans for Patients With End-Stage Renal Disease,” Health Affairs, September 2020. View the full study here: https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2019.01793.
© 2020 Project HOPE—The People-to-People Health Foundation, Inc.

Datapoint: Arise Health Plan Rebrands Under Parent Company

September 24, 2020

Arise Health Plan, a Wisconsin-based commercial insurer, says it will rebrand as WPS Health Plan in October. Arise is a subsidiary of WPS Health Solutions, a provider-founded health care organization that focuses on military families and veterans. Arise, which entered the Wisconsin Affordable Care Act exchange market in 2020, currently covers 53,951 members. About 3,500 of its members receive coverage through the exchanges.

Arise Health Plan, a Wisconsin-based commercial insurer, says it will rebrand as WPS Health Plan in October. Arise is a subsidiary of WPS Health Solutions, a provider-founded health care organization that focuses on military families and veterans. Arise, which entered the Wisconsin Affordable Care Act exchange market in 2020, currently covers 53,951 members. About 3,500 of its members receive coverage through the exchanges.

Source: AIS’s Directory of Health Plans

Trump Administration Plans Crackdown on Hospitals Failing to Report COVID-19 Data

September 24, 2020

The federal government is preparing to aggressively crack down on hospitals for not reporting complete COVID-19 data daily into a federal data system, according to internal documents obtained by NPR.

The draft guidance, expected to be sent to hospitals this week, also adds new reporting requirements, asking hospitals to provide daily information on influenza cases, along with COVID-19. It’s the latest twist in what hospitals describe as a maddening flurry of changing requirements, as they deal with the strain of caring for patients during a pandemic.

The federal government is preparing to aggressively crack down on hospitals for not reporting complete COVID-19 data daily into a federal data system, according to internal documents obtained by NPR.

The draft guidance, expected to be sent to hospitals this week, also adds new reporting requirements, asking hospitals to provide daily information on influenza cases, along with COVID-19. It’s the latest twist in what hospitals describe as a maddening flurry of changing requirements, as they deal with the strain of caring for patients during a pandemic.

The reporting system drew national attention in July when the Department of Health and Human Services told hospitals to stop reporting information — such as the number of COVID-19 patients and the availability of intensive care beds — to the Centers for Disease Control and Prevention, and instead report it into a new system managed directly by HHS, the CDC’s parent agency. The switch raised concerns from politicians and public health experts about the sidelining of CDC, the nation’s public health agency, in the midst of a pandemic….

Read the full NPR article