by US Rx Care | Apr 16, 2019 | Uncategorized
A new study has found that people enrolled in high-deductible health plans (HDHPs) actually are more likely to consider costs and quality when considering non-emergency care.
The 14th annual “Consumer Engagement in Health Care” study by the Employee Benefits Research Institute and market research firm Greenwald & Associates surveyed 2,100 adults, most of whom receive health coverage via their employers.
The survey found that people enrolled in health plans with a deductible of at least $1,350 for self only, and $2,700 for families, were more likely to take costs into account when making health care decisions.
Evidence of cost-conscious behavior:
- 55% of HDHP enrollees said they checked whether their health plan would cover their care or medication prior to purchase, compared to 41% in traditional health plans.
- 41% of HDHP enrollees said they checked the quality rating of a doctor or hospital before receiving care, compared to 33% of those in traditional plans.
- 41% of HDHP enrollees asked for a generic drug instead of a brand name drug, compared to 32% of traditional plan enrollees.
- 40% of HDHP enrollees talked to their doctor about prescription options and costs, compared to 29% of traditional plan participants.
- 25% of HDHP enrollees used online cost-tracking tools provided by their health plans to manage their health expenses, compared to 14% of people in traditional plans.
- HDHP enrollees also were more likely to take preventive measures to preserve health, including enrolling in wellness programs.
That said, the study did find some negative behavior among HDHP enrollees as well, including that 30% of HDHP enrollees said they had delayed health care in the past year because of costs, compared to 18% of traditional plan participants.
What you can do
In order to help HDHP enrollees get the most out of their plans, it’s recommended that their employers also offer health savings accounts.
This can help them pay for services that are not covered until they meet their deductible. Employers can help by matching (fully or in part) employees’ HSA contributions. This encourages them to participate.
Employers should also push preventative care. The Affordable Care Act requires all plans to cover a set of preventative care services outside of the plan deductible. Unfortunately, many people don’t know that these services must be covered by insurance with no out-of-pocket expenses for the enrollees.
Some employee benefits experts are recommending that employers tie the amount of premiums employees are required to contribute to how well they comply with preventative guidelines.
Non-enrollment in HSAs
These are the reasons employees cite for not enrolling in their company’s HSA:
- Do not see any advantages: 57%
- Do not have enough money to contribute to the account: 24%
- Their employer doesn’t contribute to the account: 10%
- Did not take the time to enroll: 8%
- Do not understand what the HSA is for: 6%
The key to getting your staff to take advantage of the tax-savings feature of HSAs is education. You should make sure all of your eligible staff understand how they work.
And if you are not currently contributing some funds to their HSAs, now might be the time to consider doing that.
by US Rx Care | Apr 9, 2019 | Uncategorized
It’s no secret that the cost of pharmaceuticals is going through the roof. You’ve heard the stories of price-gouging by some companies that have jacked up prices thousands of percent.
Drug costs are starting to weigh heavily on the cost of care, in turn driving up health insurance premiums, which individuals, employees and employers are all feeling. The cost of some medications is so extreme that a single dose may far surpass the total premium paid for coverage.
Also, most people never really know the true price of a drug unless they are 100% on the hook for medications under their health plan. Often, you may have a copay that may differ depending on the type of drug, so people usually only see what they pay. However, every year more people are on the hook for the price of their drug due to high-deductible insurance plans and formulary changes.
The website Goodrx.com, a service for comparing and locating the best prescription prices, publishes a list every year of the most expensive drugs in the country.
While few individuals will pay these full amounts, some do because of their poor choice of health plans (like ones that saddle them with 100% of drug costs) or because they have been placed in a high-deductible health plan. The following is the top 10 list, in reverse order, of monthly prices that are set by the drug companies and known as the wholesale acquisition cost:
- Cuprimine – $31,426
Cuprimine removes copper build-up caused by Wilson’s disease. Patients take one capsule of Cuprimine after every meal. The list price is $261.89 per pill.
- Harvoni – $31,500
Harvoni is the first, once-daily combination drug used to treat Hepatitis C. Patients usually take it for 12 weeks. The cost per tablet: $1,125.
- Firazyr – $32,468.40
Firazyr is an injectable medicine used after an attack of hereditary angioedema. The typical patient suffers two to four attacks per month. A pack of three syringes costs $32,468.
- Juxtapid – $36,992
Juxtapid is used to treat people with homozygous familial hypercholesterolemia, a gene mutation that leads to cardiovascular disease. The dosage is about one day. The cost per capsule: $1,321.
- H.P. Acthar – $38,892
Also referred to as Acthar, this medicine is used to treat multiple conditions, including lupus, rheumatoid arthritis, multiple sclerosis, infantile spasms, ophthalmic conditions, and psoriatic arthritis. The dosage is one vial a month, which costs $38,892 (for perspective, a vial cost $40.17 in 2001 and the price shot up after a new manufacturer took over).
- Myalept – $42,137
Myalept is used to treat leptin deficiency in patients with generalized lipodystrophy. Myalept is self-administered once a day in measured doses from vials, each one of which lasts about three days. The cost per vial: $4,213.
- Chenodal – $42,570
Chenodal is used to dissolve gallstones. Dosing varies and pills are manufactured at different strengths. Sadly, while this medicine is off-patent, which means that other manufacturers could legally produce generics, Chenodal is protected under what is referred to as a “closed distribution system.” That prevents generic drug-makers from purchasing a brand name drug. The list price for a month’s supply of Chenodal is $42,570.
- Cinryze – $44,140
Cinryze is used to treat hereditary angioedema, a rare life-threatening genetic condition that causes swelling in various parts of the body, including hands, face and throat. A one month’s supply runs to 16 vials, and the cost per vial is $2,758.
- Daraprim – $45,000
Daraprim is commonly given to AIDS and transplant patients to prevent infection, and is used to treat toxoplasmosis in otherwise healthy people. This is the medicine that got Martin Shkreli in hot water after the company at which he was CEO in 2015 raised the price per pill from $13.50 a pop to $750 almost overnight. While Daraprim can now often be obtained for $473 a tablet, the list price remains at around $45,000 for a month’s supply of 60 pills.
- Actimmune – $52,321
This is used to treat osteopetrosis and chronic granulomatous disease, which causes the immune system to malfunction. Patients use about 12 single-use vials a month, and each vial costs $4,360.
by US Rx Care | Apr 3, 2019 | Uncategorized
A ruling by a U.S. District Court judge in December 2018 that the Affordable Care Act is unconstitutional is not expected to stand but, if it does, the moves that have been made in the health insurance space to reduce costs, deliver better care outcomes and make the system more efficient would be expected to stay.
For those employers that were offering health coverage to their employees before the ACA and have continued since, the marketplace dynamics would likely not change much if the ruling were not overturned on appeal.
Additionally, since there has been some success in the employer-sponsored health care space in keeping cost inflation relatively tame, there would likely be no incentive for health insurers and providers to abandon those efforts.
The more likely outcome is that a higher court (and eventually likely the U.S. Supreme Court) overturns U.S. District Judge Reed O’Connor’s ruling that because Congress eliminated the individual mandate portion of the ACA, the rest of the law is also invalid and cannot stand. That means all aspects of the law, including health care exchanges, the employer mandate, and the requirement that policies cover 10 essential benefits, and much more. The individual mandate was repealed at the end of 2017.
Several states such as Massachusetts, New York and California have since intervened to defend the law. They argue that, if Congress wanted to repeal it, it would have done so. The Congressional record makes it clear Congress was voting only to eliminate the individual mandate penalty in 2019; it indicates that they did not intend to strike down the entire ACA.
The original lawsuit against the ACA was brought by 20 attorneys general from Republican states, and now 17 attorneys general led by California’s Xavier Becerra have filed a notice of appeal with the 5th U.S. Circuit Court of Appeals in New Orleans.
Interestingly, the Trump administration filed a brief early in 2018 encouraging the court to uphold the ACA but strike down the provisions relating to guaranteed issue and community rating.
There have been more than 70 attempts to invalidate the ACA in courts across the country, and two of those cases made it to the Supreme Court. The last time the ACA was upheld was in 2012 and all five justices who voted at that time to uphold the law are still on the bench today.
Additionally, the ACA is an extremely expansive piece of legislation, which has been on the books since 2010. Legal pundits say it’s unlikely the Supreme Court would want to strike down a law that affects millions of people in the country. In fact, because of this the court may decide not even to take up the case if the 5th Circuit has overturned O’Connor’s ruling.
Employer effects
While this case is under appeal the law will stand, meaning that all parts of it, except the individual mandate, will remain. That means all employers who are considered “applicable large employers” under the ACA, will be required to continue offering health insurance to their workers.
If you are one of them, you need to continue complying with the law of the land as it stands. And remember, while Congress eliminated the penalties associated with not complying with the individual mandate, the penalties for not complying with the employer mandate are still very much in place. Fines can be severe for non-compliance.
This ruling is not expected to affect those penalties, reporting requirements, or any other applicable ACA requirement at this time.
by US Rx Care | Mar 26, 2019 | Uncategorized
What started out as a way to help many pharmacy benefit managers (PBMs) to control costs has turned into a major sticking point in the health care system: pharmaceutical rebates.
Attention is growing regarding the role that rebates play in actually increasing the price of brand-name drugs, which is adding a heavier burden on health plan enrollees. Calls are growing to jettison rebates altogether. The problem is that insurers often get to keep the rebates and not pass them on to their enrollees.
A study by Benfield, a division of benefit consulting firm Gallagher Benefits, found that 69% of employers surveyed would welcome an alternative to rebates, such as discounts or point-of-sale rebates, in which patient payments reflect a post-rebate price.
Employers acknowledged focusing on rebates as a revenue stream rather than focusing their attention on other important factors such as reducing employee coinsurance or deductible payments, or providing access to the most effective medicines.
The issue of rebates even has the attention of the Trump administration.
When Department of Health and Human Services Secretary Alex Azar testified before the Senate Health Education Labor & Pensions Committee in 2018, he said: “We may need to move toward a system without rebates, where PBMs and drug companies just negotiate fixed-price contracts. Such a system’s incentives, detached from these artificial list prices, would likely serve patients far better, as would a system where PBMs receive no compensation from the very pharma companies they’re supposed to be negotiating against.”
How rebates work
Drug rebates are redeemed after the transaction has taken place, but it’s not the end user (the plan enrollee) who is receiving the rebates. Instead, the PBM, the insurer or sometimes the employer receives the rebate.
The big debate is that these rebates do nothing to help the enrollee, who is often having to pay a higher cost-sharing burden for medications.
Under the current system, drug makers set a list price for their products, then negotiate with some PBMs over how much of a discount they will provide off that list price.
The size of the rebate depends on a number of factors, like how many drugs are used by the health plan enrollees, and how much of the medicine cost is covered under the drug formulary.
Companies that offer bigger rebates are often rewarded with better access, like smaller copayments.
What happens if rebates are jettisoned?
Nobody can accurately predict what would happen if rebates were eliminated.
Their elimination could potentially increase expenditures for brand drugs if payers do not find an alternative tool that reduces drug costs (for example, negotiating lower prices to begin with).
A report by Altarum, a not-for-profit health care research and consulting organization, estimated that $89 billion in rebates went to payers in 2016. Altarum found that state Medicaid plans received $32 billion of the total, followed by Medicare Part D plans ($31 billion), commercial health plans ($23 billion), and other payers ($3 billion).
Eliminating rebates will have the most significant effect on patients. Medicare and commercial insurance rebates totaled $54 billion in 2016, according to the Altarum report. The big unknown is exactly how much of that total directly benefited patients and how much flowed to the insurers and the Centers for Medicare & Medicaid Services.
by US Rx Care | Mar 20, 2019 | Uncategorized
A ruling by a U.S. District Court judge in December 2018 that the Affordable Care Act is unconstitutional is not expected to stand but, if it does, the moves that have been made in the health insurance space to reduce costs, deliver better care outcomes and make the system more efficient would be expected to stay.
For those employers that were offering health coverage to their employees before the ACA and have continued since, the marketplace dynamics would likely not change much if the ruling were not overturned on appeal.
Additionally, since there has been some success in the employer-sponsored health care space in keeping cost inflation relatively tame, there would likely be no incentive for health insurers and providers to abandon those efforts.
The more likely outcome is that a higher court (and eventually likely the U.S. Supreme Court) overturns U.S. District Judge Reed O’Connor’s ruling that because Congress eliminated the individual mandate portion of the ACA, the rest of the law is also invalid and cannot stand. That means all aspects of the law, including health care exchanges, the employer mandate, and the requirement that policies cover 10 essential benefits, and much more. The individual mandate was repealed at the end of 2017.
Several states such as Massachusetts, New York and California have since intervened to defend the law. They argue that, if Congress wanted to repeal it, it would have done so. The Congressional record makes it clear Congress was voting only to eliminate the individual mandate penalty in 2019; it indicates that they did not intend to strike down the entire ACA.
The original lawsuit against the ACA was brought by 20 attorneys general from Republican states, and now 17 attorneys general led by California’s Xavier Becerra have filed a notice of appeal with the 5th U.S. Circuit Court of Appeals in New Orleans.
Interestingly, the Trump administration filed a brief early in 2018 encouraging the court to uphold the ACA but strike down the provisions relating to guaranteed issue and community rating.
There have been more than 70 attempts to invalidate the ACA in courts across the country, and two of those cases made it to the Supreme Court. The last time the ACA was upheld was in 2012 and all five justices who voted at that time to uphold the law are still on the bench today.
Additionally, the ACA is an extremely expansive piece of legislation, which has been on the books since 2010. Legal pundits say it’s unlikely the Supreme Court would want to strike down a law that affects millions of people in the country. In fact, because of this the court may decide not even to take up the case if the 5th Circuit has overturned O’Connor’s ruling.
Employer effects
While this case is under appeal the law will stand, meaning that all parts of it, except the individual mandate, will remain. That means all employers who are considered “applicable large employers” under the ACA, will be required to continue offering health insurance to their workers.
If you are one of them, you need to continue complying with the law of the land as it stands. And remember, while Congress eliminated the penalties associated with not complying with the individual mandate, the penalties for not complying with the employer mandate are still very much in place. Fines can be severe for non-compliance.
This ruling is not expected to affect those penalties, reporting requirements, or any other applicable ACA requirement at this time.
by US Rx Care | Mar 12, 2019 | Uncategorized
The Trump administration is moving ahead with new regulations that would make it easier for employers to enter into health reimbursement arrangements (HRAs) with their employees, a practice that can be severely penalized under the Affordable Care Act.
Under the proposed regulations – issued by the departments of Labor, Treasury and Health and Human Services – employees would be allowed to shop and pay for their own coverage using tax-free HRAs that are set up by their employers.
Under the proposed rule, employers that offer traditional health insurance would be allowed to fund an HRA with up to $1,800 per year. The money in the HRA could be used to reimburse employees for certain medical expenses, as well as for premiums for health insurance policies or stand-alone dental benefits.
And offering HRAs used to help employees pay for individual health insurance premiums would count as an offer of coverage to satisfy the employer mandate under the ACA.
More options, lower costs
Administration officials said expanding HRAs would give employees more options in terms of health coverage, and it also would reduce costs and administrative burdens on employers.
If enacted, the new regulations would undo Obama administration guidance (as it was not actually written into the regulations) barring employers from paying into HRAs to help workers pay for health insurance premiums from policies they buy on the open market or on government-run exchanges.
Companies that were caught in such arrangements faced a hefty fine of up to $36,000 a year.
The employer mandate would stay intact but the proposed rule would allow an employer to satisfy the mandate by funding HRAs for its workers. Under the employer mandate, organizations with 50 or more full-time or full-time-equivalent employees are required to purchase “affordable” health coverage that covers at a minimum 10 essential benefits as outlined under the law.
HRAs must be affordable
The key is that the HRA must also be affordable under the proposed rules. That would depend in part on the amount the employer contributes to the HRA.
The agencies proposing the new regulations said in an announcement that they would provide further guidance on the HRA-specific affordability test.
Funds going into HRAs would be exempt from federal income and payroll taxes. Additionally, employers would be able to deduct the amount they put into HRAs from their taxes.
The proposed rule would also require employers that offer HRAs to allow a worker to opt out and instead claim a federal premium tax credit to purchase coverage on the individual exchanges.
This is the early part of the rule-making. The proposed regulations will have to go out for public comment before final rules are written and implemented.
