Do Urgent Care Clinics Really Cut Payer Spending?

April 13, 2021

Although urgent care centers have long been trumpeted as a more economical care option than the emergency department (ED) for non-life-threatening conditions, a new study suggests that health insurers might want to re-evaluate that truism.

The study, published in Health Affairs, builds on past research by confirming that the presence of urgent care centers in any given area does in fact reduce lower-acuity ED visits. Yet researchers went a step further and asked whether urgent care centers reduced ED visits enough “to make up for the fact that more people are going to go to care when it’s more convenient and lower cost and closer and presumably lower wait time,” explains Ari Friedman, M.D., one of the study’s co-authors and an assistant professor at the University of Pennsylvania.

NOTE: The abstract below is a shortened version of the Health Plan Weekly article “Study Challenges Cost-Saving Potential of Urgent Care.”

By Leslie Small

Although urgent care centers have long been trumpeted as a more economical care option than the emergency department (ED) for non-life-threatening conditions, a new study suggests that health insurers might want to re-evaluate that truism.

The study, published in Health Affairs, builds on past research by confirming that the presence of urgent care centers in any given area does in fact reduce lower-acuity ED visits. Yet researchers went a step further and asked whether urgent care centers reduced ED visits enough “to make up for the fact that more people are going to go to care when it’s more convenient and lower cost and closer and presumably lower wait time,” explains Ari Friedman, M.D., one of the study’s co-authors and an assistant professor at the University of Pennsylvania.

The answer to that question appears to be a resounding “no.” In their analysis of insurance claims and enrollment data from a national managed care plan that spanned from 2008 to 2019, Friedman and his team estimated that 37 additional urgent care center visits were associated with a reduction of a single lower-acuity ED visit. In dollar amounts, they estimated that each $1,646 lower-acuity ED visit prevented was offset by a $6,327 increase in urgent care center costs.

Friedman says that the bulk of that “substitution ratio” is likely attributable to people visiting urgent care centers when they otherwise might have not accessed care at all. “There’s a lot of what we call the woodwork effect, which is the idea that people kind of just come out of the woodwork,” he says. “Visits happen that would never have happened before.”

That isn’t a surprising consumer behavior, since copays for urgent care center visits are often much cheaper than ED visits, Friedman points out.

Ultimately, “our results argue that using urgent care centers in isolation to reduce ED visits may be ineffectual from a spending perspective,” the study said.

When asked what health insurers should do instead, Friedman offered a variety of suggestions. “If I were a health plan I would say, ‘Maybe…we should be focusing on supporting patients and helping them choose a site of care,’” he says.

Health plans might also consider helping facilitate non-emergency medical transportation options including Uber and Lyft, Friedman says. “Another thought is to think about how utilization management and copays are applied across settings,” he adds.

Datapoint: MVP Health Care, University of Vermont to Launch Co-Branded MA Plan

April 12, 2021

MVP Health Care last week said it has partnered with The University of Vermont Health Network to launch a co-branded, physician-designed Medicare Advantage (MA) plan in New York and Vermont for the 2022 plan year. The plan will be patient-centered, and follow value-based care models in both states. As of March 2021, 3,610 people are enrolled in MVP’s MA plans in Vermont, while 60,061 are enrolled in New York.

MVP Health Care last week said it has partnered with The University of Vermont Health Network to launch a co-branded, physician-designed Medicare Advantage (MA) plan in New York and Vermont for the 2022 plan year. The plan will be patient-centered, and follow value-based care models in both states. As of March 2021, 3,610 people are enrolled in MVP’s MA plans in Vermont, while 60,061 are enrolled in New York.

Source: AIS’s Directory of Health Plans

Evernorth Drug Trend Report Highlights Pandemic’s Impact on Utilization

April 12, 2021

In the 2020 Drug Trend Report recently released by Evernorth, the Cigna Corp. division added yet another chapter to the growing volume of data detailing the profound effects that the COVID-19 pandemic has had on health care.

On the one hand, the massive amount of deferred routine and elective health care utilization had a dampening effect on the number of new medication users that Evernorth — which houses the PBM Express Scripts — recorded in 2020. New users of asthma/COPD medications dropped the most, by 7.1% year over year, likely reflecting the avoidance of clinical settings among a group that is at particular risk of contracting severe COVID-19.

NOTE: The abstract below is a shortened version of the RADAR on Drug Benefits article “Evernorth Drug Trend Report Shows Varied Pandemic Impacts.”

By Leslie Small

In the 2020 Drug Trend Report recently released by Evernorth, the Cigna Corp. division added yet another chapter to the growing volume of data detailing the profound effects that the COVID-19 pandemic has had on health care.

On the one hand, the massive amount of deferred routine and elective health care utilization had a dampening effect on the number of new medication users that Evernorth — which houses the PBM Express Scripts — recorded in 2020. New users of asthma/COPD medications dropped the most, by 7.1% year over year, likely reflecting the avoidance of clinical settings among a group that is at particular risk of contracting severe COVID-19.

Yet for commercial plans managed by Evernorth, the overall drug utilization trend increased by 3.1%, compared with just 1.4% in 2019.

“We saw higher utilization of prescription drugs to treat mental health issues associated with the pandemic — anxiety, insomnia, and depression,” says Evernorth Chief Innovation Officer Glen Stettin, M.D. “Among people with previously diagnosed and common chronic conditions, such as diabetes, high blood pressure and heart disease, many of which are risk factors for hospitalization and death from COVID-19, we also saw an increase in utilization. This utilization was driven by higher medication adherence, itself a result of more people choosing to fill their medication for 90 day vs. 30 day supplies, and the convenience and safety of having their medication delivered to their homes.”

The overall use of diabetes drugs, for example, increased by 7.4%, while utilization of asthma/COPD medications and anticoagulants each ticked up by 6.6%. To respond to the rising demand, Evernorth said it ordered significantly more albuterol.

Similarly, “when we saw spikes in prescriptions for treating COVID-19 inappropriately with hydroxychloroquine, we worked to protect the supply for people who truly needed it to treat rheumatoid arthritis and lupus,” the report said.

Evernorth’s report also included statistics that are typical of drug trend reports in more normal years. The Cigna division reported 4% total trend across its commercial plans, 3% trend in Medicare, 1.4% in Medicaid and 5.5% in health insurance exchange plans.

“Adverse selection likely played a small part in driving higher trend for health exchange plans,” the report suggested. “Of the top five classes, four are driven primarily by specialty medications, and the difference in prevalence rates among these classes compared to commercial plans is very small.”

People on the Move

April 9, 2021

Use of Pricey New Diabetes Drugs Is Higher Among Traditional Medicare Enrollees

April 9, 2021

Compared to Medicare Advantage members, seniors enrolled in Original Medicare are more likely to be prescribed costly new diabetes medications, according to a recent study in the American Journal of Managed Care. While metformin remains the standard of care for both populations, researchers found that overall use of newer medications, such as glucagon-like peptide-1 (GLP-1) receptor agonists, was 5.1% higher among Original Medicare beneficiaries, which likely contributed to higher total costs and out-of-pocket spending for that cohort. Despite their high cost, GLP-1s are picking up steam on Medicare formularies, according to data from MMIT, AIS Health’s parent company. Among the most advantaged drugs are Novo Nordisk’s Victoza 2-Pak and Ozempic, both injectables, plus Rybelsus, the first GLP-1 available as an oral tablet. Eli Lilly’s Trulicity (a weekly injectable) and Sanofi’s Soliqua 100/33 (a daily injectable) also hold strong formulary placement. Utilization management practices such as prior authorization and step therapy are rare — just 5% of Medicare lives require step therapy to access a GLP-1 receptor agonist, and 6% require any form of prior authorization.

by Carina Belles

Compared to Medicare Advantage members, seniors enrolled in Original Medicare are more likely to be prescribed costly new diabetes medications, according to a recent study in the American Journal of Managed Care. While metformin remains the standard of care for both populations, researchers found that overall use of newer medications, such as glucagon-like peptide-1 (GLP-1) receptor agonists, was 5.1% higher among Original Medicare beneficiaries, which likely contributed to higher total costs and out-of-pocket spending for that cohort. Despite their high cost, GLP-1s are picking up steam on Medicare formularies, according to data from MMIT, AIS Health’s parent company. Among the most advantaged drugs are Novo Nordisk’s Victoza 2-Pak and Ozempic, both injectables, plus Rybelsus, the first GLP-1 available as an oral tablet. Eli Lilly’s Trulicity (a weekly injectable) and Sanofi’s Soliqua 100/33 (a daily injectable) also hold strong formulary placement. Utilization management practices such as prior authorization and step therapy are rare — just 5% of Medicare lives require step therapy to access a GLP-1 receptor agonist, and 6% require any form of prior authorization.

NOTES: Other* category includes glucagon-like peptide-1 receptor agonists, dipeptidyl peptidase-4 inhibitors, sodium-glucose cotransporter-2 inhibitors, meglitinides and D-phenylalanine derivatives. Access that requires prior authorization and/or step therapy is represented by the abbreviation (PA/ST). Under the pharmacy benefit, there are 47.5 million lives covered on Medicare formularies.

SOURCES: Managed Markets Insight & Technology, LLC database as of March 2021; “Use of Diabetes Medications in Traditional Medicare and Medicare Advantage,” The American Journal of Managed Care, vol. 17, no. 3, 2021. Visit https://bit.ly/3rmi34i.

Datapoint: Friday Health Plans Scores $160 Million Investment

April 8, 2021

Startup insurer Friday Health Plans last week said it has accepted $160 million in equity investments led by Vestar Capital Partners and Leadenhall Capital Partners, and will use the funds to expand into new territories and build its small group product line. As of the third quarter of 2020, the Denver-based insurer enrolled 14,338 members in Colorado, with 75.4% enrolled in an individual commercial risk-based plan. The company in February reported membership gains of 400%, to about 75,000 lives, following expansion if its Affordable Care Act exchange offerings to Nevada, New Mexico and Texas.

Startup insurer Friday Health Plans last week said it has accepted $160 million in equity investments led by Vestar Capital Partners and Leadenhall Capital Partners, and will use the funds to expand into new territories and build its small group product line. As of the third quarter of 2020, the Denver-based insurer enrolled 14,338 members in Colorado, with 75.4% enrolled in an individual commercial risk-based plan. The company in February reported membership gains of 400%, to about 75,000 lives, following expansion if its Affordable Care Act exchange offerings to Nevada, New Mexico and Texas.

Source: AIS’s Directory of Health Plans

Biden Officials Rebuff Appeals to Surge Covid-19 Vaccine to Michigan Amid Growing Crisis

April 8, 2021

Amid Michigan’s worst-in-the-nation coronavirus surge, scientists and public health officials are urging the Biden administration to flood the state with additional vaccine doses.

So far, though, their plea has fallen on deaf ears. Instead, the federal government is sticking to a vaccine-allocation strategy that largely awards doses to states and territories based on their population. As a result, most jurisdictions are still receiving similar per-capita vaccine supplies, regardless of how many people there are getting sick — or how many excess vaccine doses they have.

Amid Michigan’s worst-in-the-nation coronavirus surge, scientists and public health officials are urging the Biden administration to flood the state with additional vaccine doses.

So far, though, their plea has fallen on deaf ears. Instead, the federal government is sticking to a vaccine-allocation strategy that largely awards doses to states and territories based on their population. As a result, most jurisdictions are still receiving similar per-capita vaccine supplies, regardless of how many people there are getting sick — or how many excess vaccine doses they have.

Experts have cast a surge in Michigan’s vaccine supply as a critical tool in combating the state’s most recent Covid-19 crisis. The state is currently recording nearly 7,000 new cases per day, just shy of its all-time peak in December. Hospitalizations and deaths, which tend to lag a few weeks behind increasing case counts, are also on the rise. …

Read the full Stat article

The Big Hole in America’s Plan to Fight Covid-19 Variants

April 8, 2021

The global scramble to produce enough Covid-19 vaccine for 7 billion people is about to get even tougher, as drugmakers and countries ready a second round of shots to combat the growing threat of virus variants.

Finding vaccines that can ward off more contagious or virulent strains is only half the battle. The United States has virtually no capacity to manufacture revised vaccines or booster shots alongside the original versions, according to a half-dozen vaccine experts and Biden administration health officials. Setting up additional facilities could take months or even years.

The global scramble to produce enough Covid-19 vaccine for 7 billion people is about to get even tougher, as drugmakers and countries ready a second round of shots to combat the growing threat of virus variants.

Finding vaccines that can ward off more contagious or virulent strains is only half the battle. The United States has virtually no capacity to manufacture revised vaccines or booster shots alongside the original versions, according to a half-dozen vaccine experts and Biden administration health officials. Setting up additional facilities could take months or even years.

Vaccine makers like Pfizer, Moderna and Johnson & Johnson coped with intense global demand for their original shots by manufacturing millions of doses while the vaccines were still in clinical trials. But that is not an option now, because the companies are still racing to fulfill orders for their existing Covid-19 vaccines — and some, including Johnson & Johnson and AstraZeneca, are struggling with major production setbacks. Pumping out second-generation shots would require factories to switch over manufacturing lines now used for the first wave of vaccines, and in some cases fire up new production processes….

Read the full Politico article

Drugs Targeting Immune Response to COVID-19 Show Promise

April 8, 2021

Researchers are reporting some progress in their search for drugs that tamp down the overwhelming immune reaction that can kill a patient with COVID-19.

These reactions are triggered by coronavirus infections and can veer out of control in some people. It’s this reaction, rather than the virus itself, that is the real peril for people seriously ill with COVID-19.

Doctors last year recognized that a cheap and readily available steroid drug called dexamethasone can often rein in this overreaction, which is a form of inflammation. In fact, it’s the only COVID-19 drug so far that clearly saves lives.

Researchers are reporting some progress in their search for drugs that tamp down the overwhelming immune reaction that can kill a patient with COVID-19.

These reactions are triggered by coronavirus infections and can veer out of control in some people. It’s this reaction, rather than the virus itself, that is the real peril for people seriously ill with COVID-19.

Doctors last year recognized that a cheap and readily available steroid drug called dexamethasone can often rein in this overreaction, which is a form of inflammation. In fact, it’s the only COVID-19 drug so far that clearly saves lives.

“Dexamethasone is a really powerful anti-inflammatory,” says Dr. Rajesh Gandhi, an infectious disease doctor at Harvard and Massachusetts General Hospital, but, “there are still people who need more….”

Read the full NPR article

Interoperability Mandate Could Be an Opportunity for Payers

April 8, 2021

Payers should look at the looming interoperability mandate as a chance to gain a lasting advantage over their competitors, according to two health care information technology (IT) experts.

In a March 26 webinar hosted by America’s Health Insurance Plans (AHIP), IBM Vice President Michael Curry of Watson Health and Jeff Rivkin, research director for payer IT strategies at IDC Insights, said payers should do more than meet the minimum interoperability standards.

NOTE: The abstract below is a shortened version of the Health Plan Weekly article “Tech Experts: Interoperability Rule Is Opportunity for Insurers.”

By Peter Johnson

Payers should look at the looming interoperability mandate as a chance to gain a lasting advantage over their competitors, according to two health care information technology (IT) experts.

In a March 26 webinar hosted by America’s Health Insurance Plans (AHIP), IBM Vice President Michael Curry of Watson Health and Jeff Rivkin, research director for payer IT strategies at IDC Insights, said payers should do more than meet the minimum interoperability standards.

“It’s just the tip of the iceberg. We’re going to see a lot of data exchanged. And if you don’t have a fairly robust platform to be able to do that, you’re going to hurt next year, too,” Rivkin said.

Starting July 2021, HHS will require insurers that sell Medicare Advantage, Medicaid and CHIP managed care, and Affordable Care Act exchange plans to launch an application programming interface (API) that will allow patients to access their complete medical and claims history on demand along with a continually updated provider directory. Payers must also make all of their patient and claims data available to other insurers on a payer-to-payer data exchange, which must be in place by January 2022.

Rivkin said insurers should think about the interoperability mandate and the mandate to release pricing information as the same project. Starting on Jan. 1, 2023, health plans must offer members online shopping tools that allow them to see the negotiated rate between their provider and their plan, as well as a personalized estimate of their out-of-pocket cost for 500 of the most shoppable items and services.

“We’re all in the middle of those implementations, but there’s a huge downstream potential for that data,” Curry explained. He says the pandemic-spurred telehealth boom has accelerated changes in consumer expectations.

“The consumer side…has changed a lot in how payers have to think about their relationships with clients,” Curry added. Consumers, he said, now expect accessing health care to be more similar to “buying something on Amazon.”

“Amazon and those like it have raised the bar from the consumerism perspective,” Rivkin said. “Now, you’ve got a significant number of people in the individual market switching because they shop for price. The idea that retail companies have had for years of loyalty and stickiness…is now relevant to health insurance.”