This is Jacob Emerson with the Becker's Payer
Issues podcast.
Here's your biweekly industry news briefing for September
23rd.
Maryland is dropping Kaiser Permanente as a Medicaid
managed care organization in 2025.
The state's deputy director of health care finance
told local media on September 20th that after
lengthy contract discussions, the state has elected not
to enter into a contract with Kaiser, and
the state is working to ensure a seamless
transition of those enrollees to other health plans.
Maryland did recently temporarily suspend new enrollments into
Kaiser's Medicaid plan, citing a failure to meet
contractual obligations
related to financial operation reporting requirements.
It is not clear if the Medicaid contract
negotiations
were related to the recent enrollment sanctions.
Maryland is also implementing new health equity standards
for managed care organizations in 2025.
Kaiser has held a Medicaid contract in Maryland
for more than 10 years, and it maintains
the highest rated Medicaid plan in the state
per the NCQA.
Kaiser told Becker's in a statement that if
the company is not able to participate in
Maryland Medicaid, it would interrupt the highest rated
care and coverage for more than 113,000
Medicaid members in Maryland in 2025,
and that Kaiser will continue to work with
the state so that they can continue to
serve that community
for decades to come. The state will renew
its existing managed care contracts with Aetna, CareFirst
Blue Cross Blue Shield, UnitedHealthcare,
Elevance Health's WellPoint,
Jai Medical Systems, Maryland Physicians Care, MedStar Family
Choice, and Priority Partners.
JI Medical and MedStar Family Choice are independent
private companies.
Maryland Physicians Care is co owned by Ascension,
Holy Cross Health, Emeritus Health, and UPMC.
And Priority Partners is owned by Johns Hopkins
Health Plans and the state of Maryland.
Well, after weeks of internal disagreements at the
Federal Trade Commission about pharmacy benefit managers, the
agency said September 20th that it is suing
CVS Caremark, OptumRx,
and Express Scripts over allegedly inflating insulin prices.
In an administrative complaint, the FTC accused the
3 PBMs of abusing their economic power by
rigging pharmaceutical supply chain competition in their favor.
The lawsuit alleges those PBMs excluded low cost
insulins to achieve higher rebates, thus artificially inflating
insulin list prices and hurting patients.
The FTC also said the legal action will
include the company's group purchasing organizations.
In recent years, the FTC has stepped away
from its decades long support of PBMs, which
handle drug pricing
negotiations
between manufacturers,
payers, and pharmacies.
The legal action comes amid the FTC's years
long investigation into the top 6 PBMs over
allegations of opaque business practices.
In July, the FTC published an interim report
on the probe, which said PBMs engage in
favoritism for their own pharmacies
and have a vast control over drug prices.
It's important to note that 2 FTC commissioners
did openly criticize
the report.
The FTC commission's vote to file an administrative
complaint was 3 to 2 with 2 commissioners
recusing themselves.
Cigna, which owns Express Scripts, has filed its
own lawsuit against the FTC on September 17th
over the interim support interim report.
The company called that report unfair, biased, erroneous,
and defamatory.
CVS told Becker's that its PBM has negotiated
lower insulin prices and increased competition after 3
leading brand insulin manufacturers
raised their list prices by as much as
500%
before 2012.
Then the Pharmaceutical Care Management Association, which is
the trade group represent
representing PBMs,
spoke out against that lawsuit. The National Community
Pharmacists Association, which represents pharmacies, applauded the FTC's
actions.
Well, OptumCare, which is located in Basking Ridge,
New Jersey, is planning to lay off a
160
employees in the state according to regulatory documents
filed with the states. Those layoffs are expected
to occur
between December 11th January
22nd
next year.
Optimus faced several rounds of layoffs and clinic
closures this year across various states. In July,
the company laid off 524
employees in California, which included remote positions in
other states.
Earlier this year, there were reports servicing on
social media about layoffs affecting employees at Optum
Virtual Care and NaviHealth.
And, additionally, in May, Optum closed a changed
health care facility in Toledo, Ohio, which resulted
in 129
job losses.
Cigna Health Care is exiting Medicare Advantage Markets.
We're making service area reductions in 8 states
for 2025.
In total, 36 plans and about 54100 members
are impacted, the vast majority in Florida.
The majority of the markets have low membership
and alternative MA plans available with the exception
of just a few full county exits.
There's a list of
Medicare Advantage market exits industry wide on the
Becker's website,
and there's more details about these Cigna exits
on our website as well, including state by
state and the types of plans that are
affected.
Southwestern Health Resources will not offer Medicare Advantage
Plans in 2025.
The company said it has decided to sunset
its MA plan because of increasing competition and
utilization
along with regulatory requirements from the federal level.
There are will be no changes for members
in 2024, but there will be no plans
to enroll in during the upcoming open enrollment
annual enrollment period.
Southwestern Health Resources is based in Farmers Branch,
Texas. It operates CarenCare, an MA company.
They had about 26,000 Medicare Advantage members according
to CMS.
Southwestern Health Resources is a joint venture between
UT Southwestern
Medical Center and Texas Health Resources.
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