Below is a roundup of payer-centric news for the week of April 15, 2024.
Elevance Health quietly acquires New York competitor
Elevance Health announced it would buy Centers Plan for Health Living, a managed care organization in New York, in its annual report released in February. The deal is expected to close in the third quarter.
Empire Center, a New York-based independent think tank, said the deal represents Elevance acquiring the state’s biggest Medicaid contractor. No purchase price was stated in the filing.
The merger means Elevance is responsible for giving care to 38%, or 110,000, Medicaid recipients in the state.
Feds investigate Virginia insurance plan over premiums
Sentara Health Plans, the insurance subsidy of Sentara Health, is being investigated by the Department of Justice (DOJ) over claims it "drastically" increased premiums while racking up more than $650 million in federal subsidies, The Virginia-Pilot reported.
When Anthem Blue Cross Blue Shield withdrew from the marketplace in 2018, Sentara was able to increase premiums by 81%. Sentara is cooperating with the DOJ and refutes claims it overcharged customers or misled government officials, the paper said.
Sentara has been under investigation since 2021.
New price transparency tools for payers, providers
Data analytics platform Clarify Health says it has new tools to help healthcare organizations operate in a price-transparent world.
Its negotiation opportunity tool helps customers differentiate how prices compare to a market rate, while its coverage scores tool helps users make sense of price transparency data files, according to a news release.
“Recently, Clarify helped a plan identify rates up to 30%-40% above market across multiple service lines and codes with a single hospital system, empowering the plan to rectify inefficiencies and optimize costs,” the company said.
Vertical integration receives fresh scrutiny
The Office of Inspector General (OIG) is evaluating vertical integration between Part D plans, pharmacy benefit managers (PBMs) and pharmacies to see how consolidation affects drug prices.
Such integration has been within the crosshairs of federal agencies and policymakers for some time. In July, the Senate Finance Committee advanced PBM legislation that would impose drug pricing standards and give leeway to the OIG to investigate vertically integrated acquisitions.
“We will determine the impact of related entity transactions within select vertically integrated entities on the prices for covered Part D drugs,” the office announced.
A report is expected to be issued in fiscal year 2026.
Report: GoHealth lays off 3% of its staff
Online health insurance marketplace GoHealth has laid off 69 of its 2,500 employees, EndPoints reported.
The company did not immediately return a request for comment.
GoHealth’s stock has plummeted by 97% over the last five years after raising $914 million through an initial public offering in 2020.
DOJ Watch
- A Mississippi man was charged with conspiracy to defraud the U.S. and receive healthcare kickbacks, conspiracy to commit healthcare fraud and wire fraud, and conspiracy to commit money laundering for his role in a $70 million fraud scheme. He allegedly managed several durable medical equipment companies, billed Medicare for orthotic braces and sold orders to suppliers and brokers.