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New Analysis Shows Medicare Advantage Condition-Specific Benefit Offerings Soar in 2020

April 24, 2020

The number of condition-specific benefits offered by Medicare Advantage organizations more than doubled in the 2020 plan year, according to a recent analysis of CMS data from Faegre Drinker Consulting. As in 2019, diabetes, congestive heart failure and chronic obstructive pulmonary disease (COPD) remained the most targeted illnesses, though researchers noted rapid growth in hypertension and coronary artery disease offerings. This plan year also marked the first time MAOs were able to offer Special Supplemental Benefits for the Chronically Ill (SSBCI), non-medical benefits that aim to help members limit and prevent complications from serious conditions, though uptake of these benefits was modest compared to the growth in condition-specific offerings.

by Carina Belles

The number of condition-specific benefits offered by Medicare Advantage organizations more than doubled in the 2020 plan year, according to a recent analysis of CMS data from Faegre Drinker Consulting. As in 2019, diabetes, congestive heart failure and chronic obstructive pulmonary disease (COPD) remained the most targeted illnesses, though researchers noted rapid growth in hypertension and coronary artery disease offerings. This plan year also marked the first time MAOs were able to offer Special Supplemental Benefits for the Chronically Ill (SSBCI), non-medical benefits that aim to help members limit and prevent complications from serious conditions, though uptake of these benefits was modest compared to the growth in condition-specific offerings. The graphics below highlight the most commonly offered condition-specific benefits, plus the diseases they target, as well as an overview of SSBCI uptake, ranked by the number of plans offering each benefit type.

SOURCE: 2020 Vision: New Information on 2020 Medicare Advantage Benefits, Part II, Faegre Drinker analysis of CMS data, March 27, 2020. Visit https://bit.ly/34toEQv.

Increased Biosimilar Use Could Offer Significant Savings for Employers

April 17, 2020

U.S. self-insured companies would have saved up to $1.4 billion on two biologics — Remicade (infliximab) and Neupogen (filgrastim) — in 2018 if their covered employees used the drugs’ biosimilar alternatives, according to a study conducted by the Johns Hopkins University (JHU) Bloomberg School of Public Health for the ERISA Industry Committee. The researchers analyzed reference biologic spending by 13 large employers and concluded that biosimilars in 2018 represented only 0.5% of infliximab claims but 68.8% of filgrastim claims.

by Jinghong Chen

U.S. self-insured companies would have saved up to $1.4 billion on two biologics — Remicade (infliximab) and Neupogen (filgrastim) — in 2018 if their covered employees used the drugs’ biosimilar alternatives, according to a study conducted by the Johns Hopkins University (JHU) Bloomberg School of Public Health for the ERISA Industry Committee. The researchers analyzed reference biologic spending by 13 large employers and concluded that biosimilars in 2018 represented only 0.5% of infliximab claims but 68.8% of filgrastim claims. If there was full biosimilar substitution among employees covered by the participating companies in 2018, those firms would have saved an average of $1.53 million on infliximab and $17,838.01 on filgrastim. For infliximab, the reference biologic Remicade currently has the most covered lives among commercial formularies, while for filgrastim, Zarxio (a biosimilar for Neupogen) is the leader in market access, according to MMIT data.

NOTE: Under the pharmacy benefit, there are 184.3 million total covered lives under commercial formularies and 48.2 million covered lives under health exchange formularies.

SOURCES: “Biosimilar Medications — Savings Opportunities for Large Employers,” The ERISA Industry Committee. View the study at https://bit.ly/3c3l9Tr. Managed Markets Insight & Technology, LLC database as of April 2020.

Medicare Advantage Penetration Reaches 36% in 2020

April 10, 2020

Medicare Advantage penetration continued to grow following the 2020 Medicare Annual Election Period, reaching 36.0% in 2020, according to CMS’s March data release. Thirteen states and territories have MA penetration rates of greater than 40%, with the Commonwealth of Puerto Rico leading the pack at a whopping 69.1% penetration. Just two states, Alaska and Wyoming, have a penetration rate of under 10%. See a complete map of MA penetration, with current MA enrollment by state, below.

by Carina Belles

Medicare Advantage penetration continued to grow following the 2020 Medicare Annual Election Period, reaching 36.0% in 2020, according to CMS’s March data release. Thirteen states and territories have MA penetration rates of greater than 40%, with the Commonwealth of Puerto Rico leading the pack at a whopping 69.1% penetration. Just two states, Alaska and Wyoming, have a penetration rate of under 10%. See a complete map of MA penetration, with current MA enrollment by state, below.

NOTE: Per AIS’s research methodology, enrollment data does not include approximately 420,000 lives enrolled in CMS’s Financial Alignment Initiative demonstration plans for Medicare-Medicaid Dual Eligibles.

SOURCE: CMS; DHP, AIS’s Directory of Health Plans.

U.S. Health Spending Could Climb to 19.7% of GDP by 2028

April 3, 2020

Total U.S. health care spending is projected to increase at an annual average rate of 5.4% over the next decade, reaching $6.2 trillion by 2028, according to CMS. Health expenditures’ share of Gross Domestic Product will rise from 17.8% in 2019 to 19.7% in 2028, as health spending growth will be 1.1 percentage points faster than that of GDP, on average, over the 2019-28 period. According to the forecast, average annual spending growth in Medicare will be the fastest, due to higher projected enrollment growth.

by Jinghong Chen

Total U.S. health care spending is projected to increase at an annual average rate of 5.4% over the next decade, reaching $6.2 trillion by 2028, according to CMS. Health expenditures’ share of Gross Domestic Product will rise from 17.8% in 2019 to 19.7% in 2028, as health spending growth will be 1.1 percentage points faster than that of GDP, on average, over the 2019-28 period. According to the forecast, average annual spending growth in Medicare will be the fastest, due to higher projected enrollment growth.

NOTE: “Other Health Insurance Programs” includes the Children’s Health Insurance Program (Titles XIX and XXI), Dept. of Defense and Dept. of Veterans Affairs.

SOURCES: CMS, Office of the Actuary; U.S. Dept. of Commerce, Bureau of Economic Analysis; and U.S. Bureau of the Census. Visit https://go.cms.gov/1J3iyc9.

2019 Program Audit Scores by Plan Sponsor, With Civil Monetary Penalty Status

March 27, 2020

Of the 13 Medicare Advantage and Part D organizations that were subject to 2019 program audits, nearly half received a civil monetary penalty (CMP), with noncompliance in the audit area of Part D formulary and benefit administration (FA) driving fines.

CMS via the Health Plan Management System released the audit scores of the 13 organizations that underwent 2019 Medicare Parts C and D program audits, with scores ranging from 0 to 1.74 (the lower the score, the better the performance). The results included Health Care Service Corp. (HCSC), which was audited in 2018 and 2019 but received a CMP only for 2018.

by Lauren Flynn Kelly and Carina Belles

Of the 13 Medicare Advantage and Part D organizations that were subject to 2019 program audits, nearly half received a civil monetary penalty (CMP), with noncompliance in the audit area of Part D formulary and benefit administration (FA) driving fines.

CMS via the Health Plan Management System released the audit scores of the 13 organizations that underwent 2019 Medicare Parts C and D program audits, with scores ranging from 0 to 1.74 (the lower the score, the better the performance). The results included Health Care Service Corp. (HCSC), which was audited in 2018 and 2019 but received a CMP only for 2018.

The CMPs imposed on six organizations last year amounted to nearly $1.2 million, or an average of $198,400 per organization, according to AIS Health’s review of CMP notices posted online. This is compared with $204,900, or nearly $41,000 on average, based on the 2018 program audits.

*CMS evaluated HCSC’s 2018 and 2019 program results together, and the resulting CMP applies only to the 2018 audit.

SOURCE: CMS, Medicare Parts C and D Oversight and Enforcement Group Memo, “Civil Money Penalty Enforcement Actions for 2019 Program Audits,” issued March 2, 2020. Visit https://go.cms.gov/3aHXJ5a.