Value-based care, GLP-1s: 4 takeaways from AHIP 2024

LAS VEGAS—Last week, leaders across the health insurance industry descended on Sin City to dig deep into the biggest topics facing payers.

From the cost of GLP-1s to value-based care, here are a few key takeaways from the conference:

Walgreens pitches payers

Walgreens President of U.S. Healthcare and former Solera Health CEO Mary Langowski is “bullish” on retail healthcare—and thinks payers should be too.

Langowski spent a significant portion of her fireside chat addressing the payer representatives in the room, persuading them why it’s in their best interest to partner with Walgreens in the retail health space. She said that most people live within five miles of a Walgreens pharmacy and millions of customers navigate its app each month, trusting the company to handle prescriptions. That opens up partnership potential, pointing toward a colorectal screening partnership that resulted in high engagement rates and two times higher conversion rates.

“Over 80% of people want health and wellness offerings in a pharmacy and in a retail setting,” she told the audience. “I think what you’re seeing is a lot of evolution around, not whether it’s going to exist, but evolution on what’s the right model going to be. We really think if you take a look at our core assets, we can be really good partners.”

Those assets include VillageMD (and its acquisition of Summit Health-CityMD), its home healthcare business CareCentrix and specialty pharmacy business Shields Health.

Walgreens’ stock is currently $15.17, down from $81 a share in 2018. The company closed 60 underperforming clinics and exited five markets recently in an effort to save $1 billion in costs. Its net loss last quarter was $5.9 billion.

Langowski assumed her new position with Walgreens in March and said collaboration is possible with providers and payers across the country to help serve mutually beneficial needs. For example, she noted that payers are thinking about how to rein in specialty drug costs and predict utilization, she said.

“That’s my plea to all the payers in the room,” she added. “We would love to be your partner. We are the only independent player out there.”

Value-based care

Executives at major health plans spoke of the importance of moving the healthcare system towards value-based care.

Providence Health Plan CEO Don Antonucci said the time is now for payers and providers to embrace the shift, particularly as more of the financial burden from the traditional Medicare system is pushed onto employers.

“I do see this as a time in healthcare where I would say the next 24 to 48 months is where we’ll see some significant changes coming and some significant fragmentation will continue,” said Antonucci. “I do think healthcare is at a breaking point because that two to three years we’re talking about is very real. We're at this point where we've got to move and accelerate much faster in the industry.”

The Centers for Medicare and Medicaid Services (CMS) previously set a goal to transition Medicare, and most Medicaid, beneficiaries to value-based arrangements by 2030. Projected health expenditures total $4.8 trillion, with Medicare spending growing 8.4% and private health insurance spending rising 11.1%.

Part of that goal is for innovation center models to be multi-payer aligned, but progress may need to happen at the local and state levels.

“I think it’s possible to get there by 2030,” said Mark Friedberg, senior vice president of performance measurement and improvement for Blue Cross Blue Shield of Massachusetts.

Value-based care doesn’t mean costs will automatically be cheaper. As members develop multiple conditions, the area of value-based specialty care grows in importance. The issue is more complicated than value-based primary care, said Luz Ramos, M.D., medical director of clinical care transformation for Independence Blue Cross.

“Long gone are the days that someone just has hypertension or diabetes, but now they have complex conditions,” she said. “They have a plurality of diagnoses. Once you’re more complex, you need more care.”

In value-based behavioral health, Author Health CEO Katherine Hobbs said partnership with primary care is paramount to better outcomes for members. She said members with serious mental illness, substance use disorder and dementia likely have other physical medical conditions.

“If you’re actually going to move the needle in terms of total health and cost for these individuals, you have to be working not only on the behavioral health symptoms but also on their physical health needs as well,” said Hobbs.

GLP-1s dominate the conversation

From the show floor to the panel hall, people at AHIP were talking about GLP-1s.

The conference kicked off its keynotes on Wednesday morning with a panel discussion on these drugs and the challenges facing payers as they navigate the coverage landscape. Timothy Law, chief medical officer for Highmark, said that insurers should focus on staying out of the way of providers while keeping an eye on potential overuse and inappropriate prescribing.

"We're looking to be a conduit of care, not a roadblock," Law said.

Law said that payers are tasked with balancing regulations that vary between states with the expectations of the employers who contract with them. And these firms are looking very closely at the costs and unclear long-term prognosis of these products.

Highmark hasn't deployed tactics like body mass index cutoffs to manage the use of GLP-1s, Law said. But there are other UM strategies in the conversation, such as potentially raising premiums for people who take these drugs.

Beyond the cost concerns, there are significant supply issues that are making it difficult for patients who actually need GLP-1s to get their hands on them. John Love, general manager and VP of Amazon Pharmacy, told Fierce Healthcare in an interview that these products are difficult to handle and ship, which makes the challenge even greater.

"Unfortunately, it's a bit of a mess," Love said. "There's no way pharmacies will be able to dispense these medications under the current practice."

Marc Harrison's gene therapy call to action

While GLP-1s may have been the dominant topic at the conference, multiple panels looking at the cost of pharmaceuticals did touch on gene therapies as well. Many of these products are coming to market with a highly niche and specialized patient population and a price tag in the millions.

Marc Harrison, M.D., who leads General Catalyst's HATCo arm, said during a keynote session that it's critical for insurers to identify "alternative payment mechanisms" for these therapies. Harrison, who was formerly the CEO of Intermountain Healthcare, noted that he is a recipient of gene therapies.

"They're miraculous. They're about to change the world," Harrison said. "Most people can't afford them, and I think payers are justifiably concerned about what the inclusion of those will do to their financials."

He said it's key for the industry to take a step back and examine how gene therapies are "carved out" early on and then made more widely available should the price come down, as they can have a tremendous effect in minimizing the suffering of patients with complex diseases.

"So that's my homework assignment for you. I'm sure you'll have that done in no time flat," he joked.

Gene therapies and the concern about the cost also drove tension in an earlier panel focused on pharmaceutical spending. Adam Kautzner, president of Express Scripts, said that for clients, historically, these were "lightning strike-type of patients" given their rarity, but it's becoming a growing challenge.

The pharmacy benefit manager has rolled out programs that manage these costs under a single per-member, per-month fee to cover the drug. Kautzner said the goal is to ensure that the right patients who can benefit from these therapies can access them.

Merith Basey, executive director of Patients for Affordable Drugs, pushed back on this idea, expressing concern that it could lead to only a subset of patients being able to secure these drugs if they needed them.

Kautzner said, however, that given the cost it's critical to "perform due diligence to ensure that patients that can benefit the most receive those products."

"It's not sustainable, and so we're going to have to work on some more innovative solutions here to be able to provide real value," he said.