Health Care Matters | July 26, 2024
Health Care Costs to Grow 8% Next Year
PricewaterhouseCoopers (PwC) released projections for health care costs next year, with an expected 8% increase in commercial spending, the highest growth estimate since 2012. This forecast is predicated on the continuing demand for the new weight loss drugs, GLP-1s, and other expensive drugs for Alzheimer’s, Parkinson’s, multiple sclerosis and schizophrenia, a rise in demand for behavioral health combined with the shortage of providers and tough commercial contract negotiations due to stagnant Medicare and Medicaid reimbursement rates.
Why It Matters
High cost drugs such as GLP-1s are having a huge impact on health care spending leading self-insured employers to consider trade-offs between premiums and coverage of certain drugs for employees. Payers and employers are also investigating opportunities for outcomes based contracting and increased use of prior authorizations which can be wearisome for both providers and patients. It is also worth noting that government reimbursement rates impact commercial contracts and hospitals and providers look to commercial insurers to supplement revenue when government programs fall short of expectations. This can be more easily achieved in markets with significant health care consolidation, where providers have the leverage to demand certain prices from insurers to remain in network.
Why Primary Care Practitioners Aren’t Joining Value-Based Payment Models
The Commonwealth Fund released a study to further understand why many primary care practitioners (PCPs) are choosing not to participate in Value-Based Care (VBC), what barriers prevent uptake and potential solutions. The study involved interviewing 12 practice leaders and 17 frontline PCPs, all with no prior VBC experience. Findings indicate that PCPs face financial barriers, workforce shortages, and lack of trust for performance measurement. The Commonwealth Fund’s potential solutions to these barriers included ensuring sufficient upfront primary care payments from models, increased investment in workforce training, and proper metrics to support access and continuity of primary care.
Why It Matters
CMS has a goal of moving all Medicare FFS beneficiaries and the vast majority of Medicaid beneficiaries into accountable care relationships by 2030. To accomplish this feat, CMS has introduced a myriad of models designed to meet primary care providers where they are. This includes total cost of care models (TCOC) like MSSP and REACH and the recently announced PC Flex as well as medical home models like Making Care Primary. The Commonwealth report demonstrates that some practices still do not see an easy path to participation and that CMS has yet to fully make the case. The recommended solutions by Commonwealth including multi-payer participation, support for rural practices, specialist engagement, improved measures and increased technical assistance are all features or proposed features of models currently in development.
What We Are READING
NAACOS & Health Care Transformation Task Force Report on Reimagining Beneficiary Engagement in Accountable Care Models
The HCTTF and NAACOS released a resource addressing how policies can be strengthened to improve the patient experience in value-based care arrangements.
FTC Report on Pharmacy Benefit Managers
The FTC released its July 2024 Interim Staff Report publishing findings on pharmacy benefit managers (PBMs), specifically on how they’re inflating drug costs, allowing them to pay their own mail-order pharmacies 200 times more than rival pharmacies. The report notes the six largest PBMs – including CVS Health Corp., Cigna Group, and UnitedHealth Group Inc. – account for 95% of US prescriptions.
Please use the following links to read the Chairman and Commissioners statements following the report.
Commonwealth State Scorecard on Reproductive Care
Where a woman lives matters to her health: US states vary widely in access to care, quality of care, and health outcomes for women.
WHAT WE ARE LISTENING TO
Health Affairs Podcast
A podcast discussing the Supreme Court’s overturning of the Chevron doctrine and the implications for health policy moving forward.
Milestone Conquered!
Coral is now proudly and officially a certified woman-owned small business!