Health Plan Weekly

Entering 2024, growing health care costs are the main worry of employer plan sponsors, according to industry experts. To cope with the problem, those experts add, employers may seek novel benefit designs, while also reaching for tried-and-true cost control methodologies like narrower networks. 

Brokerage WTW found in a September survey that 69% of surveyed large employers listed health care costs as a “top health and wellbeing priority” over the next three years, and that health care costs were the most frequently named priority by respondents. 

“I think that the emphasis on cost is actually bigger now than it was a few years ago,” says Jeff Levin-Scherz, M.D., population health lead at WTW and an assistant professor at the Harvard School of Public Health. 

While many people had closed their laptops and were gearing up to open presents, the U.S. District Court for the District of Columbia offered a gift to patient advocates that have been fighting for restrictions on private health plans’ use of copay accumulator programs. 

In September, Judge John Bates ruled in favor of a challenge brought by patient advocates — including the HIV + Hepatitis Policy Institute, the Diabetes Patient Advocacy Coalition and the Diabetes Leadership Council — to provisions in a 2021 rule that allowed group and individual health plans to apply copay accumulators even when drugs have no therapeutic alternative. Such programs prevent enrollees from counting any drug manufacturer discounts, like copay coupons, toward their deductibles and out-of-pocket maximums. Insurers and PBMs argue that copay accumulators are necessary to prevent copay coupons from steering patients to high-cost branded drugs — raising costs for everyone — but patient advocates contend that those coupons are necessary to promote affordability amid benefit designs that force patients to bear the brunt of their prescription drug costs. 

At least 13.3 million people lost their Medicaid or Children’s Health Insurance Program (CHIP) coverage and another 24.9 million had their coverage renewed as of December 2023, according to the KFF Medicaid enrollment and unwinding tracker. Starting April 1, 2023, states were permitted to resume disenrolling people from Medicaid who were no longer eligible or failed to complete the redetermination process after a multiyear pause during the COVID-19 public health emergency.

The disenrollment rate so far has ranged from 62% in Texas to 10% in Maine. Overall, 71% of coverage losses were due to procedural reasons, when individuals didn’t complete their renewal process within a specific time frame or the state was unable to reach them. Over 90% of disenrolled people had their Medicaid coverage terminated for procedural reasons in New Mexico (95%), Utah (94%) and Nevada (91%).

Elevance Health, Inc. has agreed to acquire Paragon Healthcare, a company that provides infusion services to patients. Elevance announced the pending transaction on Jan. 4 and said it expects the deal to close in the first half of this year. The companies did not disclose financial details, but Axios reported Elevance will pay more than $1 billion for Paragon, which operates in Alabama, Colorado, Florida, Georgia, Missouri, Oklahoma, Tennessee and Texas. If the deal closes, Paragon will become part of CarelonRx, Elevance’s pharmacy services segment. 

The Cigna Group is in “advanced talks” to sell its Medicare Advantage business to Health Care Service Corp. (HCSC) for between $3 billion and $4 billion, according to a Jan. 3 Wall Street Journal article. The report comes shortly after Bloomberg cited anonymous sources saying HCSC and Elevance Health were interested in acquiring Cigna’s Medicare business, a segment the company entered in 2012 through its acquisition of HealthSpring. Cigna has struggled to compete in Medicare with market leaders such as UnitedHealth Group and Humana Inc., and it has just 580,000 MA lives, according to AIS’s Directory of Health Plans. Earlier last month, the WSJ reported that discussions about a potential transaction between Cigna and Humana had fizzled.