Payer Roundup—Blues pour cold water on GLP-1 drug utilization; Michigan signs law elevating mental health coverage

Updated: May 24, 11:30 p.m. ET

Below is a roundup of payer-centric news headlines you may have missed during the month of May 2024.


Blue Cross: Patients are quitting GLP-1 drugs for weight loss early

Nearly six in 10 patients quit using GLP-1 drugs for weight loss before reaching a “clinically meaningful” health benefit, Blue Cross Blue Association said.

The insurer’s research found more than 30% of patients dropped out of treatment after four weeks, before the dosage had increased to its targeted level. Most patients did not stay on the GLP-1 track through a minimum of 12 weeks, and people aged 18 to 34 were more likely to discontinue early.

“This study underscores how much more we have to learn about these medications,” said Kim Keck, president and CEO of BCBSA, in a statement. “The science behind these drugs is moving faster than our ability to truly understand which patients will benefit, how to sustain their success and how to pay for them. If we don’t get it right, we will drive up costs for everyone with little to show for it.”

Blue Cross’ analysis comes from national pharmacy and medical claims data.


Michigan to require insurers cover mental health treatments

Health plans must cover mental health and substance use disorder treatments at the same level as physical health services in the state, Michigan Governor Gretchen Whitmer said in a statement May 21.

She said the bill will close loopholes and put mental health on an equal playing field.

“The signage of Senate Bill 27—Michigan's first mental health parity law that reiterates the verbiage of the Federal Mental Health Parity and Addictions Act of 2008—is a signal to all of us in this state that the tide is turning,” said Marianne Huff, president and CEO of the Mental Health Association of Michigan.


Insurers must cover medically necessary abortion, New York court finds

The New York Court of Appeals upheld a ruling requiring health plans to cover medically necessary abortions, AP News reported.

Religious groups had opposed the ruling, arguing it could violate the freedoms of religious employers.

Governor Kathy Hochul applauded the court’s decision as a “critical step” toward protecting women’s health in the state.


Survey: Young people would pay higher taxes to fund Medicare

More than nine in 10 of Millennials and Generation Xers say they are entitled to healthcare coverage in retirement, and more than eight in 10 are willing to pay higher taxes to guarantee Medicare is solvent, a new survey found.

Approximately two-thirds of respondents worry Medicare won’t exist when they are old enough to rely on the program.

“Concern about Medicare’s future is no longer unique to current beneficiaries and older Americans. Our report shows that younger Americans are worried about their access to quality, affordable healthcare as they age,” said eHealth CEO Fran Soistman in a statement.

A vast majority of respondents say Medicare is a top voting issue for them, adding that earlier generations were “fiscally irresponsible” to leave the younger generations with solvency worries.

eHealth, a private health insurance marketplace, surveyed more than 1,000 people born between 1965 and 1996.


Dems slam Virginia governor over veto

Virginia Governor Glenn Youngkin vetoed a bill May 17 to protect contraception access. Democrats quickly jumped on the decision.

“Nowhere is the threat to contraception more clear than in the votes and in the veto that just occured,” said State Senator Ghazala Hashmi, R-Virginia, in a statement. “Every Republican in the state Senate voted against this bill and our governor vetoed it. He can give any excuse he wants to, but his veto pen speaks louder than words.”

Youngkin said he supports access to contraception but the the now-rejected legislation would “trample” on religious freedoms, reported The Hill.


Senate white paper on Medicare doc pay reform

The Senate Finance Committee released a paper May 17 that would redesign how doctors are paid by Medicare and incentivize alternative payment models.

Medicare’s physician fee schedule spending exceeded $91 billion in 2022, or approximately 17% of traditional Medicare spending.

The white paper (PDF) advocates for including inflation-related annual adjustments, as recommended by clinician organizations, to the physician fee schedule conversion factor. It also raises concern surrounding the “sustainability of owning and operating a physician practice” as hospitals continue to get acquired.

“The way Medicare pays doctors for their work has not kept up with the times, and if it’s not working for doctors, it’s not working for the patients they help,” said Sen. Ron Wyden (D-Oregon) “It’s critical that traditional Medicare keep up, and this effort to update and strengthen the program for the next generation of Americans will make that a reality.”

The National Association of Affordable Care Organizations (NAACOS) and the Medical Group Management Association (MGMA) backed the white paper's recommendations.

"We are very encouraged by its discussion on options that continue to incentivize value-based care," said Clif Gaus, president and CEO of the organization. "NAACOS supports considering alternatives to the current bonus structure, including ways to eliminate participation thresholds, and better updates than the current conversion factor.

"Paramount is the need for an annual physician payment update commensurate with inflation and modernization of the antiquated Medicare budget neutrality policies that can only be described as ‘robbing Peter to pay Paul.' MGMA looks forward to working with the Committee to advance commonsense legislation that will begin to stabilize a Medicare reimbursement system that has long threatened the livelihood of our nation’s medical practices," said MGMA Senior Vice Presidnet of Government Affairs Anders Gilberg.


Centene establishes $12 million Indiana equity initiative

Centene subsidiary Managed Health Services (MHS) is launching a $12 million health equity program to reduce health disparities in Indiana.

MHS will give at least $2 million to “health equity-focused programs” as led by the Indiana Minority Health Coalition and Black Onyx Management.

The group will work with providers, federally qualified health centers and community-based organizations to research factors leading io inequity.


Raskin wrangles insurers, PBMs in letter over birth control access

House Oversight and Accountability Committee member Jamie Raskin (D-Maryland), wrote the nation’s largest insurance companies and pharmacy benefit managers (PBMs) Thursday.

In the letter, he asked for assurance the plans would improve access to free contraception, The Hill reported. Federal guidance has determined patients should be given access without cost-sharing.

The Biden administration previously sent a warning to plans in 2022, telling them they must comply with the Affordable Care Act’s preventive services clause.


UnitedHealthcare fined $450K over mental health violations

UnitedHealthcare will receive a $300,000 fine from Minnesota regulators after the company was accused of not following mental health parity laws. An additional $150,000 will be owed if a corrective action plan does not take place.

The insurer did not admit to or deny the settlement’s claims, The Star Tribune reports.

Minnesota’s mental health statutes are in place to better expand access to mental health and substance use disorder, said a state commissioner in statement.

The fine will not make a dent in the insurer’s finances. The company reported $5.5 billion in profit during the fourth quarter of 2023, the last quarterly earnings before the Change Healthcare cyberattack.


Congressional Progressive Caucus outlines priorities

Members of the Congressional Progressive Caucus met outside Capitol Hill this week to bring further attention to the group's 2025 agenda.

The caucus is calling for (PDF) lowering health care costs and expanding access through supporting the Medicare drug price negotiation program, lowering the Medicare eligiblity age and expanding Medicare to include dental, vision and hearing.

Chaired by Rep. Pramila Jayapal D-Wa., the group also wants to increase funding for community health centers and behavioral health providers, as well as “crack down on” private equity and Medicare privatization. Their outline would codified gender affirming care and ban conversion therapy.


CMS approves Delaware, Tennessee 1115 waiver programs

On May 17, CMS approved state Medicaid 1115 waiver programs for Delaware and Tennessee.

Delaware’s waiver will be in effect through 2028 and approves coverage of a pilot program that covers two home-delivered meals per day, 80 diapers a week and one pack of baby wipe for postpartum beneficiaries. It also approves coverage of contingency management, a treatment for stimulant use disorder.

Tennessee’s waiver will extend through 2030 and is expected to expand coverage for low-income parents and caretakers, and permits the state to cover 100 diapers per month per child for children under two years old.


California plan funds health information exchange initiative

L.A. Care Health Plan is sending healthcare practices funds to better secure patient medical information electronically through adoption of health information exchanges (HIEs), the nation's largest publicly operated health plan announced Wednesday.

The commitment totals $2.8 million over three years. Providers and plans were mandated to start exchanging data in January, but some providers were granted exception to begin the practice by 2026.

“L.A. Care plans to support 426 practices—both solo practitioners and clinics—in this one-time incentive program,” said John Baackes, L.A. Care CEO, in a statement. “The incentive funding is intended to support implementation fees and any annual subscription costs the practices might have when they sign on to one of the exchanges.”

Group practices are able to receive up to $30,000, clinics up to $28,500 and solo practitioners up to $5,000.


Iowa extends postpartum Medicaid coverage

Iowa signed into law Wednesday a law that extends Medicaid coverage to new and expectant mothers for one year, starting in 2025.

It's the continuation of a policy that began during the COVID-19 pandemic, reported the Iowa Capital Dispatch. Families making less than $64,500 per year qualify.

“By extending post-partum Medicaid coverage for thousands of new moms, we will set new families on a path to prosperity and opportunity,” said Gov. Kim Reynolds in a statement.


UHG awards mental health grant

The Arc of the United States has received a three-year, $2.5 million grant from the United Health Foundation to improve mental health for people with intellectual and development disabilities (IDD).

Katy Neas, CEO of The Arc, which is a nonprofit advocating for those with IDD, said mental health needs are “going unmet due to stigma, lack of training and biases” in this community.

Ten communities will receive $100,000 grants through the partnership. United Health will train caregivers, first responders and educators on mental health needs for this population, according to a news release.


Former Boston Celtic prison bound for insurance fraud

Glen “Big Baby” Davis, a 2008 NBA champion for the Boston Celtics, has been sentenced to 40 months in prison for his role in an alleged insurance fraud scheme.

Davis and 21 other people, including 18 former players, filed false claims with the league’s benefits plan. He was found guilty for healthcare fraud, wire fraud and conspiracy to commit fraud, according to multiple news outlets.


CVS Aetna settles fertility lawsuit

Aetna has settled a lawsuit that alleged the insurer made fertility treatments more expensive for LGBTQ+ customers, news outlets reported.

The insurer will now reimburse individuals denied coverage with a pool of funds totaling $2 million. Aetna will also work to standardize all fertility treatment access.

CVS Health said the company is “committed to providing quality care to all individuals regardless of their sexual orientation or gender identity,” a spokesperson told media organizations.


Economist: Illinois weight loss drug coverage could exceed cost projections

Illinois Gov. JB Pritzker is looking for $210 million to cover one year of weight loss drugs, a decision that could result in positive health outcomes but may prove to be too financially difficult, reported WBEZ.

Pritzker codified a provision in the May budget that requires insurance carriers to cover the drug through the State Employees Group Insurance Program. However, one economist said the real cost could be anywhere from $300 million to $590 million, and the health-related benefits would not offset the costs enough to be viable.

About 1 in 8 adults say they have taken GLP-1 drugs, and 6% are currently taking a GLP-1 drug, a new KFF tracking poll found.


New Wellcare primary care partnership

Centene business Wellcare and Wellvana, a value-based care physician company, are looking to expand primary care in several states.

The new, multiyear partnership is available to eligible members in Georgia, Tennessee and Texas.

"Through Wellcare and Wellvana's like-minded approach to value-based care, we are well positioned to advance the health of our members and improve the quality of care we provide," said Michael Carson, CEO of Centene's Medicare business, in a statement.


NAACOS sends letter to CMS over urinary catheter fraud

Worried about blowback against unsuspecting accountable care organizations (ACOs), a coalition of industry groups are urging the Centers for Medicare & Medicaid Services (CMS) to not punish ACOs for the recent catheter fraud scandal.

Led by the National Association of ACOs, the groups are asking CMS to remove catheter expenditures from ACO calculations in 2023, develop an outlier policy for similar spending oddities and give providers an option for second reconciliation.

House Republicans sent a similar letter in March, demanding more answers for how this scandal flew under the radar. CMS said last month it is looking into the issue.


Boston Children’s joins BCBSMA financial model

Boston Children’s Hospital will be the first children’s hospital in the country to join a pay-for-equity financial payment model.

The model, established by Blue Cross Blue Shield of Massachusetts (BCBSMA), is designed to improve health equity (in areas like colorectal cancer screenings and diabetes care) and value-based care arrangements for its members. More than half of BCBSMA members receive care in agreements originating from this model, according to a release.

Major health systems already participate in the model including Tufts Medicine, Steward Healthcare, Beth Israel Lahey Health, Mass General Brigham and Boston Accountable Care Organization.


Oregon buys Medicaid members air conditioners

Oregon is sending its Medicaid residents air conditioners and other equipment to alleviate health effects that are a result of extreme climate change effects, reported KFF Health News.

The state is the first to use Medicaid funds for climate-related costs, hoping to improve health outcomes in the comfort of an individual’s own home.

“Climate change is a health care issue,” said Department of Health and Human Services Secretary Xavier Becerra.