Health Plan Weekly

  • MCO Stock Performance, January 2021

    Click here for a pdf of the full issue
  • With New Order, Biden Alludes to Array of ACA Rule Changes

    Late last month, President Joe Biden issued an executive order (EO) that made headlines chiefly because it reopened the federal health insurance exchange and signaled that the end is near for controversial Trump-era Medicaid policies like work requirements. Yet the language in the order also indicates that Biden is directing federal regulators to make a host of revisions to the rules governing the Affordable Care Act (ACA) exchanges, which the Trump administration generally sought to loosen.

    In his order, Biden tells federal agency leaders to review all existing regulations, orders, guidance documents and policies to determine if those actions violate the administration’s goal to “protect and strengthen Medicaid and the ACA and to make high-quality healthcare accessible and affordable for every American.” Per the order, that includes:

  • Rebate Rule Is Delayed, Likely to Be Repealed by Congress

    The Biden administration will suspend implementation until 2023 of the so-called “rebate rule,” a Trump administration regulation that would have revamped the Medicare prescription drug rebate system. D.C. insiders expect Congress to eliminate the rule before then for budgetary reasons, but say that drug pricing and PBM regulation will be high on the health care agenda after policymakers address the latest issues arising from the COVID-19 pandemic.

    The suspension comes in response to a suit against the rule by a PBM trade group, the Pharmaceutical Care Management Association (PCMA), which sought to overturn the rebate rule on the grounds of its rushed implementation. A court order brokered in the U.S. District Court for the District of Columbia stipulates that all provisions of the final rule that were scheduled to take effect on Jan. 1, 2022, are now postponed until Jan.1, 2023, and it directs the parties involved in the lawsuit to issue a joint status report “identifying whether and how this case should proceed by not later than April 1, 2021.”

  • Who Would Benefit From Removing Employer Coverage ‘Firewall’?

    by Jinghong Chen

    Between 6% and 13% of people in nonelderly households with employer-sponsored coverage could pay lower premiums in the Affordable Care Act marketplaces if there was no longer a “firewall” preventing people who have access to affordable, comprehensive employer-based coverage from accessing ACA subsidies, according to a study by the Commonwealth Fund. Currently, an estimated 26% of nonelderly people with employer coverage whose income is below 200% of the federal poverty level (FPL) spend more than 8.5% of their income on after-tax premium contributions. The researchers analyzed the potential effects of allowing more employees to use subsidies to purchase ACA marketplace plans, both with the current subsidy schedule and an enhanced schedule that passed the U.S. House of Representatives in June 2020 and would extend subsidies to all income levels and caps premiums contributions at 8.5% of income. The study found that Black, Hispanic and American Indian or Alaska Native individuals could particularly benefit from such a policy change, as could individuals in the South.

  • Equities Analysts Downplay Anthem’s 2021 Guidance Slip

    Anthem, Inc.’s stock value dropped roughly 7% in early trading on Jan. 27 after the insurer reported its fourth-quarter and full-year 2020 financial results, but it wasn’t the company’s performance last year that triggered investor concern. Instead, the catalyst was Anthem’s 2021 earnings per share (EPS) guidance of “greater than $24.50,” which dipped below the Wall Street consensus of $25.37.

    In addition to the stock slide, Citi analyst Ralph Giacobbe told investors in a Jan. 28 research note that “we fielded a number of calls/emails on [Anthem] as well as read-through for the group,” suggesting investors became skittish not only about the Blue Cross Blue Shield carrier but also publicly traded insurers in general. Jefferies analysts David Windley and David Styblo shared a similar experience, writing that “Inbound callers had expressed concern” about Anthem’s results.

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