Health Plan Weekly

✦ In public remarks made Feb. 11, CMS Administrator Seema Verma hinted at possible regulatory changes to prior authorization. Verma says CMS has received more than 2,000 comments on the subject of prior authorization, and held 35 “listening sessions” with stakeholders. On the legislative side, insurers have expressed concern about a bill that would standardize prior authorization in the Medicare Advantage program (HPW 9/30/19, p. 4). Read Verma’s remarks at https://go.cms.gov/2UOeXcx.

✦ In one of the largest investments to date in managing the social determinants of health, CVS Health Corp. invested $67 million in affordable housing over the course of 2019, according to a recent press release. Housing insecurity and other social factors have a well-documented effect on health outcomes and cost of care (HPW 1/20/20, p. 1). CVS said its investments helped to create more than 2,200 affordable homes with supportive services for people across 24 cities in six states. Read more at https://prn.to/39ALWW6.

During a Feb. 12 presentation outlining its 2019 financial results, CVS Health Corp. touted a “successful first full year with Aetna,” saying the transaction produced “synergies above expectations” at approximately $500 million. And CVS’s Health Benefits segment — which houses its new insurance business — posted a “solid” fourth quarter, in the words of Citi Research securities analyst Ralph Giacobbe. Meanwhile, Molina Healthcare Inc., which posted its full-year and fourth-quarter 2019 earnings on Feb. 11, reported quarterly results that were “largely in line” with Wall Street’s consensus estimates, according to Jefferies analysts David Windley and David Styblo. But the analysts also highlighted an underwhelming performance from Molina’s Affordable Care Act (ACA) exchange business.

Across its enterprise in 2019, CVS delivered adjusted earnings per share (EPS) of $7.08 with total revenues of nearly $257 billion — a 32% year-over-year increase “reflecting a full year of Aetna’s operations and positive momentum across our enterprise,” CEO Larry Merlo told investors during the company’s earnings call, per a transcript of the call published by the Motley Fool.

Recently, medical records software vendor Epic Systems Corp. made headlines by threatening to sue HHS over its proposed regulations promoting interoperability and urging its clients to oppose the new requirements as well.

Epic is not the only health care player that may be put off by the Trump administration’s interoperability proposals, which it released last February in a bid to help patients share and obtain their health records more easily. Insurers would face a slew of new requirements to facilitate better data-sharing under one of the two proposed rules (HPW 2/25/19, p. 1).

Legislation to protect patients against surprise medical bills is once again gaining momentum in Congress, with two key House committees voting to advance proposals. However, passage of competing bills by the House Education and Labor Committee and the House Ways and Means Committee also emphasized the policy divide between lawmakers and stakeholders on the main sticking point: how to decide rates for out-of-network providers.

Education and Labor, which approved its bill on Feb. 11 with a bipartisan majority, would set payments for providers by basing them on regional benchmarks, while still giving providers the option of going to arbitration for bills higher than $750. Ways and Means, meanwhile, backed mediation between insurers and providers to set rates, again on a bipartisan vote. That panel also threw in a new twist: a provision designed to rein in private equity firms that have purchased physician practices.

As the concept of a public insurance option gains increasing visibility in the 2020 presidential race, the spotlight is also trained on Washington and Colorado — states that are at different stages of setting up their own versions of a public option yet are facing similar challenges.

While they can vary considerably, public option programs generally aim to offer individual market customers a more affordable choice for health coverage than existing commercial plans by means such as capping administrative expenses and provider reimbursement rates. A public option provision was infamously eliminated from the Affordable Care Act (ACA) during the push to get it through Congress.