Welcome to my Editorial Page where I comment on Healthcare News & Industry changes.

January 12, 2023

Happy New Year!!

As we head into the new year, employers continue to experience economic head-winds in a tight labor market, coupled with inflation challenges. Many employers made little to no changes to their benefit programs for 2023. According to the Kaiser Family Foundation, health insurance premiums in 2022 increased by six percent based on a large survey of US employers. While this increase is still high, it is similar to the increases we have seen in previous years. Industry experts are predicting larger increases in the next three to five years. With the 2023 renewals, employers faced large increases and difficult stop loss renewals. Future Healthcare costs will be driven by broader factors such as the global economy, workforce trends, medical innovation and breakthrough treatments – like gene therapies and emerging specialty medications and of course the policy/regulatory changes.

Health Care Costs are predicted to rise significantly in 2023-2025

The increase will be driven in part by pent-up demand for medical services, labor shortages in hospitals and in the broader healthcare sector – leading to wage increases… all likely add to the increase in cost for services. We are also seeing utilization increase; according to the National Business Group on Health’s 2023 Large Employers’ Health Care Strategy and Plan Design Survey, 43% of employers have already witnessed an increase in medical services due to care delayed during the pandemic, and another 39% anticipate seeing the same in the future. One condition group in particular—cancer—is fueling employer concern as well. Cancer is now the top condition driving health care costs and trend, as more late-stage cancers are identified and more expensive treatments are becoming available.

Affordable, quality health care.

For everyone. 

Together we can make it happen!


Join us on Thursday, January 19, 2023 @ 12 noon EST

for this 55 minute webinar

1 CE Credit for SHRM + HRCI are available!

New Genomic treatments are saving lives but they are costing employers millions of dollars! Join @Marybeth Gray’s #webinar to learn how employers are grappling with these costs and new-to-market solutions they should consider for 2023. This state of the market #Healthcare update will cover everything you need to know about medical advancement and marketplace disrupters.

Register to attend: https://attendee.gotowebinar.com/register/4721822326304430352

October 20, 2022
A Summary of 2023 Health and Welfare Plan Limits and Other Annual Adjustments
The Internal Revenue Service (IRS) released Revenue Procedure 2022-38 on October 18, 2022, which contains
the 2023 inflation adjustments for various employee benefit plans, including health care flexible spending accounts
(HCFSAs), qualified transportation fringe benefits, and adoption assistance programs. This Alert also summarizes
other health and welfare benefit plan limits announced earlier this year, and provides a brief summary of changes
to the employer shared responsibility penalties under the Affordable Care Act (ACA).
If you have any questions or need further details about the tax limits and how they will affect your employee benefit
programs, please contact your account team.
Health & Welfare Plan Inflation Adjustments
As expected, the 2023 HCFSA employee contribution limit increased significantly from 2022 by $200. Employees
can contribute up to $3,050 for plan years beginning on or after January 1, 2023. Employer contributions, if any, do
not count against this $3,050 limit. The dependent care flexible spending account limit (DCFSA) remains unchanged.
We provide a comparison of FSA limits for 2022 and 2023 below.
FSA Plan Design Limits
Item 2022 2023
HCFSA Salary Reduction Limit $2,850 $3,050
HCFSA Carryover Limit $570 $610
DCFSA Annual Limit $5,000 $5,000
Qualified Transportation Fringe Benefits
The monthly dollar limit for employee contributions increased to $300 per month for the value of transportation
benefits provided to an employee for qualified parking. The combined transit pass and vanpooling expense limit
also increased to $300 per month.
Adoption Credit/Adoption Assistance Programs
The maximum adoption credit allowed under Code Section 23 increases to $15,950. Similarly, the maximum amount
that an employer can exclude under Code Section 137 from an employee’s income for adoption assistance benefits
increases to $15,950. The income threshold at which the credit (and income exclusion for employer provided

 The $5,000 DCFSA limit is statutory and requires an act of Congress to modify it. The American Rescue Plan Act of 2021 permitted DCFSAs
to increase the 2021 calendar year reimbursement limit to $10,500, but Congress did not extend this and the limit reset to $5,000 in 2022.
Compliance Alert | Employee Health & Benefits MarshMMA.com
benefits begins to phase out increases to $239,230 and is completely phased out for taxpayers with modified
adjusted gross incomes of $279,230 or more.
Other Health & Welfare Plan Limits
The IRS released Rev. Proc. 2022-24 on April 29, 2022, containing the 2023 high deductible health plan (HDHP)
and health savings account (HSA) annual limits. The U.S. Department of Health & Human Services also previously
released the 2023 annual limits for non-grandfathered medical plans subject to the Affordable Care Act (ACA). The
limits apply to plan years beginning during the applicable calendar year. Limits for 2022 and 2023 are shown below
for comparison purposes.
ACA Plan Design Limits
Item 2022 2023
Out-of-Pocket Maximum Limit2 Self-only: $8,700
Family: $17,400
Self-only: $9,100
Family: $18,200
Embedded Self-Only Out-ofPocket Maximum Limit2 $8,700 $9,100
HDHP and HSA Annual Limits
Item 2022 2023
HDHP Minimum Deductible Self-only: $1,400
Family: $2,800
Self-only: $1,500
Family: $3,000
Minimum Embedded
Individual Deductible (if used) $2,800 $3,000
HDHP Out-of-Pocket Maximum
Self-only: $7,050
Family: $14,100
Self-only: $7,500
Family: $15,000
Embedded Self-Only Out-ofPocket Maximum Limit2 $8,700 $9,100
HSA Annual Contribution Limit Self-only: $3,650
Family: $7,300
Self-only: $3,850
Family: $7,750
HSA Catch-up Contribution
Limit (age 55 and older) $1,000 $1,000
2023 maximum amount for Excepted Benefit HRA
IRS Rev. Proc. 2022-24 also includes the 2023 revised annual contribution limit for Excepted Benefit HRAs. The
maximum annual HRA contribution is $1,950 for plan years that begin in 2023.

2 Limits do not apply to grandfathered plans under the ACA.
Compliance Alert | 3
Employee Health & Benefits MarshMMA.com
A Presidential Executive Order created Excepted Benefit HRAs in late 2017. If it meets certain conditions, an
Excepted Benefit HRA is exempt from the ACA’s plan design mandates, allowing an employer to offer it on a
standalone basis. Excepted Benefit HRAs may reimburse general medical expenses and premiums for COBRA,
short-term limited duration insurance, and other excepted benefits coverage.
Increase to ACA Employer Mandate Penalties
Section 4980H Penalties
The ACA’s employer shared responsibility mandate requires Applicable Large Employers (ALEs) to offer medical
coverage to their full-time (FT) employees3
in order to avoid potential penalties.
 The Section 4980H(a) penalty (the “no offer” penalty) – This penalty is triggered when an ALE fails to offer
minimum essential coverage to at least 95% of its FT employees for a month, and at least one FT employee
receives a subsidy in the Public Health Insurance Marketplace (Marketplace) for that month. The “no offer”
penalty calculation is:4
(The ALE’s total number of FT employees – 30) × 4980H(a) penalty amount
 The Section 4980H(b) penalty (the “inadequate offer” penalty) – This penalty is triggered when an ALE offers
minimum essential coverage to at least 95% of its FT employees but fails to offer affordable and/or minimum
value coverage to a FT employee who receives a subsidy in the Marketplace. The inadequate offer penalty is
limited to the FT employees actually receiving subsidies.
The IRS listed the 2023 penalty amounts on its website (see Q/A 55). For comparison purposes, the 2022 and 2023
affordability safe harbor percentages and penalties are below.
Plan year beginning
on or after
Section 4980H(a)
Section 4980H(b)
Affordability Safe
Harbor %
January 1, 2022 $229.17/month
$4,120/year 9.61 %
January 1, 2023 $240.00/month
$4,320/year 9.12 %
Failure to Report Penalties
The 2023 penalties for failing to timely file Forms 1094/1095 with the IRS and/or to deliver Forms 1095 B or C to
required individuals will be $290 for each missed form.

3 The offer must also include the FT employee’s natural and adopted children under age 26 in order to count as an offer to the FT employee.
If the ALE is a member of a group of closely related employers, the 30 FT employee exclusion does not independently apply to each member.
Instead, each member receives a share of the total exclusion based on its proportion of FT employees relative to the entire group


May 11, 2022

The Internal Revenue Service (IRS) announced the new limits for the 2023 plan year. This update impacts both Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHPs). Due to the cost-of-living adjustment rules, the HSA contribution limits, minimum annual deductibles, and maximum out-of-pocket amounts will increase. The HSA catch-up contribution amount will remain the same as last year. 

2023 HSA contribution limits

  • Individual:$3,850 (up from $3,650 for 2022)
  • Family: $7,750 (up from $7,300 for 2022)

2023 HDHP minimum annual deductibles

  • Individual: $1,500 (up from $1,400 for 2022)
  • Family: $3,000 (up from $2,800 for 2022)

2023 HDHP maximum out-of-pocket amounts

  • Individual:$7,500 (up from $7,050 for 2022)
  • Family:$15,000 (up from $14,100 for 2022)

2023 HSA catch-up contribution amount (same as last year)

For members who reach age 55 by December 31, 2023, the catch-up amount is $1,000.


Marsh McLennan to exit Russia



(Reuters) – Marsh McLennan, the world’s largest insurance broker, said on Thursday it will exit all of its businesses in Russia.

“We intend to transfer ownership of our Russian businesses to local management who will operate independently in the Russian market,” CEO Dan Glaser said in a statement.

The move comes as operating in Moscow has been increasingly difficult for Western financial institutions amid international sanctions against Russia.

March 10, 2022

Sharing a recent interview with a local news outlet…

We are interested in Trion a Marsh McLennan Co…

How would you describe your job to someone who doesn’t work in Benefits Consulting? My job is to listen to our clients every day, learn more about who they are, what they want most in the world, and how we can help them. My team and I are obsessed with improving Benefits Programs to yield higher outcomes, better quality of care for our members and keep the cost sustainable.  However, my kids would say,  “you beat up insurance companies for a living!”

What’s your favorite project you’ve worked on?  Hands down – understand what’s driving costs by looking at the data and coming up with NEW ways to engage member in embracing better health through cutting-edge programs.   An example is Cancer Care and developing Centers of Excellences for high quality care with cutting edge technology like Immunotherapy and new treatment options.   We can make a difference in people’s lives.

One trend you’re most excited about:   Absolutely the breakthrough in medical advancements.    We will see more change in healthcare in the next 5 years than we have in the last 50!   Now that science has decoded the human genome, we are seeing more serious diseases that have plagued Americans for generations solve by Gene Editing.   There are over 400 gene therapies in clinical trials and several on the market with more hitting in 2022 pending FDA approval.   These gene therapies will cost millions of dollars per patient and are very troubling for employers on the cost side.  That being said, we are hopeful they eradicate and cure disease we have been treating and paying for for decades.   There has also  been a lot of disruption in our space in terms of tech companies moving into the healthcare space with wearables and other devices aimed at helping patients monitor and manage chronic conditions.   Exciting opportunities for employer to use some of these to reduce costs and improve outcomes with member engagement.    We look at data to find what’s driving costs and deploy new solutions to solve the issues in improve health outcomes.   

“It’s so exciting to see employers try new plan offerings to help their employees to better health,  foster better relationships with their employees and grow their business with a great philosophy in the benefits programs they offer!”


January 30, 2022

Happy New Year to everyone!   


My Predictions for what lies ahead in Healthcare for 2022…

One thing is certain, I will never get the predictions right on the nose! After all, who would have predicted the global pandemic continuing to change our lives 24 + months in… and the Great Resignation driving employers changing the way we look at almost every aspect of how we do business in 2022! Despite the uncertainty of the future, there are positive changes in healthcare that can help us navigate the cost challenges we will face. We should embrace the changes to enable us to seize opportunities to Improve Care, Improve outcomes and the health of our employee populations and Reduce Costs for Employers.  We will see more change in healthcare in the next 5 years, than we have in the past 50 years!  It’s exciting – so let’s get started! Our 40 minute webinar on February 4, 2022 will help you understand what’s on the horizon to help you prepare! We will discuss my five predictions for 2022:

1.      The Pandemic has irreversibly changed the way Americans are comfortable receiving healthcare with a surge in telemedicine that will likely not dissipate.  Employers embracing this change may be able to incorporate other changes to help the highest costing members use technology to manage their care in new ways. Amazon has entered the market with Amazon Care- that has the potential to change how we think about primary care delivery.

2.      Pharmacy Costs will continue to be the fastest escalating cost in Healthcare. I am confident you can take this prediction to the bank! Pharmacy costs are the fastest growing part of our healthcare costs overall. This spend is not equally distributed among our population, with one percent of the population accounting for more than one-third of pharmacy costs! The industry needs a different approach to manage and control costs with the most expensive million dollar drugs/therapies yet to hit the market. There are over 40 genomic treatments in the FDA pipeline for approval in the next 24 months! These will be the high claimants on employer utilization reports.   We need to embrace new approaches to managing pharmacy costs on behalf of the true payers – You -the employers!

3.      Employers are not approaching Benefits Programs in the Business as Usual way! In 2022, large employers are looking at the cost drivers in their plans with the most expensive diseases – Diabetes, Cardiovascular Disease and Cancer to embrace a new approach.   This is where the advances in medical treatment can integrate with technology to change the way we manage the sickest in our population to improve care and reduce costs.  Immunotherapy is taking center stage as the approach to treating cancer – developed by Medical Noble Peace Prize winner James Alison. These exciting breakthroughs need to be utilized by our members through a Center of Excellence Approach in our benefit plan designs. This is just one example of many new opportunities coming to market. Precision Medicine and Precision Nutrition are two more examples of easy to embrace strategies. 

4.      Genomics presence in today’s medicine – Precision Medicine will have its day in the sun in 2022! My prediction on this is predicated on physicians embracing a new and better way of treatment that is precise analysis our individual genome and what is most effective for us as an individual. As managers of the benefits programs, we need to understand that the genomic testing will allow physicians to look for biomarkers that would indicate our predisposition for certain cancers and diseases to focus on prevention. It will also help us understand how we metabolize medication thus enabling providers to best prescribe drugs that we can metabolize more effectively for better treatment. With more accuracy and less waste =we will achieve lower cost and better outcomes! In the next decade, we will see major change in Preventing illness vs. treating illnesses if we embrace the new genetic technology opportunity.

5.       Diversity, Equity and Inclusion in our Benefits Programs and Strategies are center stage in 2022 with HR scrambling to address inequities in care with the new remote workforce. We are struggling with the “Great Resignation” and realigning our programs to help us with the talent shortage and improve the desired “Employee Experience”. We are addressing increased mental health needs with employees feeling more stressed than ever and how it is impacting our costs and productivity.

Join us Thursday for a great discussion that will address all of these predictions for the next year with strategies and tips to help us manage the ever growing challenges of Healthcare Benefits Costs! 

You’re Invited:  February 4, 2022 at 12:00 EST

Welcome 2022!

The New Realities We are Facing with Healthcare Costs

CE Credit for this 40 minute session for both SHRM & HRCI

To Register – Click Here:


The Road Ahead in Healthcare Benefits in 2022. What Employers Should be Thinking About!

July 26, 2021

(Reuters) – Insurance brokers Aon PLC and Willis Towers Watson PLC said on Monday they had agreed to terminate their $30 billion merger agreement and end their litigation with the U.S. Department of Justice.

The deal would have put Aon ahead of the world’s largest insurance broker Marsh & McLennan Cos Inc .

“Despite regulatory momentum around the world, including the recent approval of our combination by the European Commission, we reached an impasse with the U.S. Department of Justice,” Aon CEO Greg Case said in a statement.

Aon will pay $1 billion as a termination fee to Willis, it said.

In June, the Department of Justice had sued to block the deal, saying it would reduce competition and could lead to higher prices.

The DOJ had alleged that combining the two large insurance brokers would harm competition in reinsurance broking, retirement and pension planning and private retiree multicarrier healthcare exchanges.

A federal judge had narrowed the scope of the lawsuit last week, which came after Aon and Willis agreed to divestitures to win approval in the United States and Europe after discussions with regulators.

The divestitures included Aon’s U.S. retirement unit, U.S. retiree healthcare exchange and retirement business in Germany. Also included was Willis Towers Watson’s global reinsurance business. EU antitrust regulators approved the merger earlier this month conditioned on some of the sales.

Aon ranks second and Willis fifth among U.S. commercial retail insurance brokers in the U.S. market, according to a survey by Business Insurance magazine.


June 8, 2021


Alzheimer’s Treatment Given Provisional FDA Approval

Yesterday, the FDA approved Biogen’s aducanumab, the first drug to treat the underlying cause of Alzheimer’s (sticky brain plaques) and potentially slow the disease’s progression in early stage patients. Although not a cure, aducanumab could be the first step in treating the leading cause of dementia and the sixth leading cause of death in the US!

Some Physician are Skeptical…

Biogen had shelved the drug in early 2019, then surprised us by bringing it back in October 2020.   Last November, experts advised the FDA not to approve aducanumab after a pair of studies showed conflicting results about its effectiveness.   But the FDA fast-tracked it, arguing that the benefits of slowing Alzheimer’s outweigh the risks. Since aducanumab’s clinical effectiveness isn’t certain, Biogen will still have to conduct post-approval trials.

Biogen says the treatment, which will be sold under the name “Aduhelm,” will cost $56,000 a year. 

Stay tuned for how the PBMs and Employers will potentially cover this new Drug.


April 30, 2021

COVID-19 vaccinations have brought heightened hope for the end of the current health crisis, but many of us in healthcare worry the pandemic may have created an

even greater and longer-lasting challenge for millions of individuals with preventable chronic health conditions. 

Currently, 6 in 10 adults in the U.S. have at least one chronic disease, while 4 in 10 have two or more, according to the Centers for Disease Control and Prevention.

The safety protocols instituted to slow the spread of COVID-19 also disrupted access to many non-emergency, routine care services for months.

That’s led to a reported rise in patients showing signs of more advanced preventable chronic diseases because they were not managed or controlled at earlier stages.


Chronic Diseases in America

10 people


hands holding up icons for heart disease, cancer, chronic lung disease, stroke, alzheimer's disease, type 2 diabetes, chronic kidney disease

When Developing Plan Designs in the strategy meetings this year, Employers need to add incentives for employees/ members in the Chronic Illness Bucket to get

their preventive screening and be adherent with their medications.

April 27, 2021

The American Rescue Plan Act of 2021

COBRA Subsidy Overview

  • The American Rescue Plan Act of 2021 (the “ARPA”) creates a temporary COBRA subsidy with enhanced election opportunities for eligible individuals
  • The subsidy covers 100% of the applicable COBRA premium for eligible individuals from April 1, 2021 – September 30, 2021 and COBRA coverage is free during this period
  • The subsidy is not optional and all covered group health plans must administer it
  • The value of the subsidy is reimbursable through tax credits
  • In most cases, it is the employer/plan sponsor who is ultimately responsible for complying with the COBRA subsidy rules and who will claim the tax credits
  • We expect federal agency guidance will appear in the form of one or more technical notices followed by waves of FAQs
    • Initial guidance in the form of FAQs appeared on April 7, 2021 but was very incomplete
    • We expect additional guidance by early or mid-May
    • IRS guidance for credit reimbursement may not appear before summer

What Employers Need to Do:

  • Action plan summary for employers (assisted by COBRA administrators):
    1. Identify existing subsidy-eligible individuals (recommend completing by early May; must complete by end of May)
    2. Prepare and distribute subsidy notices (must begin by end of May)
    3. Administer COBRA with subsidies in effect (must begin by end of May; participant refunds apply for April/May)
    4. Claim tax credits (first claim date is August 2, 2021 unless requesting advance payment)

December 2, 2020

I hope everyone is well and had a great and safe Thanksgiving!  It doesn’t really need to be said, but 2020 was a  very challenging year for all of us!  With all of the in person conferences being canceled, the sharing of information, industry knowledge and thought leadership around managing benefits has been a challenge.  We have recorded and published the sessions we would have normally done at the conferences and have made them available for free to our HR partners.

I have created a new podcast series – focused on delivering strategic resources for my HR Professional network. As we move through the calendar, benefit planning must continue, so I will be touching on the items that Employers should be focused on to make their 2021 renewal successful!    You can access the podcast through the “Take 5 With MB” tab here on my website MBGrayHealthcare.com   or on my new YouTube page       Here:    https://www.youtube.com/channel/UCHKi1s5O9dbzbdZDfj6ftdw

November 17, 2020       

In this newsletter, we are sharing the following news items:

  • COVID 19 Vaccine update.
  • Fate of the ACA.
  • Presidential Election effecting Healthcare Stocks Positively?
  • Transparency Legislation and Employer Requirements.
  • Blue Cross Blue Shield Association will Distribute $2.7 Billion Dollars to End Lawsuit.

Hopeful News on a COVID 19 Vaccine

On Monday November 9th, Pfizer and German biotechnology firm BioNTech announced initial findings that their vaccine candidate appears to be more than 90% effective. This week, Moderna announced a second vaccine that is shown 94.5% effective against COVID19.   Both vaccines have similar results because they use the same technique to activate the body’s immune system.   This type of vaccine is new and has never been tried before.  This is welcomed news at a time when the US and other countries are seeing an unprecedented surge in COVID-19 confirmed cases.   Initially distribution will be controlled centrally to prioritize health care workers and high-risk vulnerable populations.   According to the Center for Disease Control (CDC), the U.S. government will purchase the COVID-19 vaccines from the manufacturers for controlled distribution and therefore the vaccine itself will be available to the identified populations at no cost. Cost of vaccine administration by health care providers will depend on individual plan rates and vaccination site.

Currently the CARES act mandates that COVID-19 vaccinations will qualify as preventive services, and therefore be provided at no cost sharing to plan participants. Let’s be smart and continue to Reinforce Necessary Safety Measures – While vaccine development is a critical step in changing the course of the pandemic, effective vaccination of millions of people is a complex and time-consuming task. Employers should reinforce the importance of hand washing, social distancing and mask wearing at the same time as they share information about availability and accessibility of the vaccine for employee populations. In a CNN interview on November 10th,  Dr. Fauci said the timeframe for vaccine availability for the U.S. general population could be as early as April of 2021.

U.S. Supreme Court Begins Review of the Affordable Care Act (ACA)

  As the Supreme Court begins to hear the case regarding the legality of the ACA, Justice Kavanaugh, and Justice Roberts Signal Inclination to Keep Obamacare Alive.  The Supreme Court justices say individual mandate could be severed while keeping the rest of the ACA intact.  The first week of the annual open enrollment period showed a significant enrollment in the US of almost 1M Americans seeking insurance through the ACA.

The final decision is not expected until mid-year 2021, but this is good news for the 20 million people who obtain health insurance through the ACA.  Both Chief Justice John Roberts and Justice Brett Kavanaugh both suggested during oral arguments Tuesday that they won’t vote to strike down the entire law even if the court invalidates a provision that requires people to acquire insurance. A key question is whether the court would “sever” that so-called individual mandate so that the rest of the law remains intact.   For more on this story:  https://www.bloomberg.com/news/articles/2020-11-10/trump-shaped-supreme-court-poised-to-hear-his-challenge-to-aca

Politics… The Stock Market Post Election
Why did Stocks Soar Post Election?

With a Democrat – Biden Presidency and Democrat held House but the Senate – republican held, creates a gridlocked Congress where passing significant reform legislation would be tumultuous.  This is what sent Healthcare stocks soaring post-election– jumping on the reduced likelihood of any significant drug pricing reforms passing. Thoughts on Wallstreet seemed to react positively to the thought that without the support of the Senate, a Biden presidency could face an uphill battle to enact major policy changes or pass a sweeping stimulus deal.   Last week, the S&P closed at a record on Friday. Two things could be driving stock prices higher: 1) optimism about the arrival of an effective Covid-19 vaccine and 2) stronger than expected corporate earnings.

Transparency Legislation

New Transparency Rule Requires Plan Sponsors (Employers) to Disclose Costs Up Front to Employees/Members

The Trump Administration delivered final regulations that will require most group health plans and insurers to disclose price and cost-sharing information. In an effort to increase competition and lower price in healthcare, in the final rule, hospitals are required to make their standard charges publicly available beginning in 2021. Despite legal challenges to enjoin the rules, it appears the rule will go into effect as written.

The Transparency in Coverage rule has a phased in implementation that would require plan sponsors and insurers for plan years beginning on or after:

  • January 1, 2022 release of three separate machine-readable files that include detailed pricing information of all in-network negotiated rates, historical payments and charges from out-of-network providers, and prescription drug in-network negotiated rates and historical net prices at the pharmacy location level.
  • January 1, 2023 disclosure of out-of-pocket cost information and the underlying negotiated rates through an internet-based self-service tool for 500 shoppable services as determined by the Administration.
  • January 1, 2024 disclosure of price and cost-sharing information for all items and services through the self-service tool.

A couple of noticeable changes from the proposed rules are the separate machine-readable file for prescription drug prices and the phased effective dates. We certainly welcome the effective date relief. While not specifically requiring a quality metric, the regulators may address that in future guidance and encourage plans and issuers to further innovate around the baseline transparency standards and include quality information and other metrics that would assist in consumer decision-making. As we’ve said before quality matters, especially for more complex care – it means fewer complications, better outcomes and lower overall costs. But hey, we have to start somewhere.

Make no mistake; this is a heavy lift for employer-plan sponsors who will need to work with their health plan partners to obtain the data they need to disclose the data. In their haste to comply with the regulations employers may miss a golden opportunity. This is the time to put quality front and center.

Mercer posted the following link for further guidance.   Mercer is a sister company to Trion Consulting under the Marsh company umbrella.


Sharing the following article with you on the BC/BS Assoc. Settling the Anti-Trust Litigation for $2.7B where Anthem agreed to Pay 22% of the Settlement.

Blue Cross Blue Shield Association will distribute $2.7 billion to qualifying policyholders to end an anti-trust lawsuit.

By Kelsey Waddill

November 05, 2020 – Blue Cross Blue Shield Association (BCBSA) has nearly concluded an eight-year-long anti-trust litigation with a $2.67 billion settlement, according to court documents which the Office of the Insurance Commissioner of Washington State has made available to the public.   The case could not be completely settled until the 36 Blue Cross Blue Shield companies approved the settlement.  “The BCBSA and Blue plans have approved a settlement agreement and release, or the Subscriber Settlement Agreement, with the subscriber plaintiff,” Anthem’s third quarter report from October 28 stated.   BCBSA has not acknowledged anti-trust and anti-competitive actions on their part.

“We reject claims plaintiffs made in the lawsuit,” read a BCBSA statement on the matter.

“However, to reach a settlement, we’ve agreed to make some operational changes and provide payment to members of the class involved in the case. Settling now is the right action at the right time because it allows us to remain focused on the goal we’ve had for more than 90 years: improving access to quality healthcare for all Americans and the health of our local communities.”   Qualifying policyholders will receive at least $5 from the $2.67 billion settlement. In total, Blue Cross Blue Shield Association has 107 million members in the US—one in three Americans are covered by a Blue Cross Blue Shield health plan.   According to Anthem’s third quarter report, the company will cover $594 million of the settlement cost, which is roughly 22 percent of the overall cost.   In addition to paying billions of dollars in monetary relief, BCBSA has agreed to eliminate its national revenue caps and put limits on its local revenue caps.

“That cap, which the Blues call the ‘National Best Efforts’ provision, requires that two-thirds of each Member Plan’s national healthcare-related revenue come from Blue-branded products as opposed to non-Blue (i.e. ‘Green’) business,” the court document explained.

The settlement will also impact the bidding process for Qualified National Accounts for Blue plans. National accounts are employers that offer the same coverage benefits across multiple sites. These large employers used to be restricted to only one Blues health plan bid, but now will be able to bid for two Blues health plans.   Additionally, there will be fewer limitations on BCBSA’s acquisitions, the company will offer direct contracting between non-provider vendors and self-funded accounts.    The most favored nations clauses and differentials—which the Department of Justice and the Federal Trade Commission have recognized as having varying impacts on competition—will be restricted.    Lastly, BCBSA will submit to a five-year monitoring period, starting when the court issues the final judgement and dismissal.

This is not the company’s first time embroiled in an anti-trust lawsuit.

Anthem’s attempt at merging with Cigna resulted in a lawsuit from the Department of Justice which ultimately found that the merger would violate anti-trust laws.The repercussions of that merger have only recently come to a close five years after the original merger announcement. After much dispute between the payer giants about who should pay damages to whom for the blocked merger, the court decided that neither company would receive financial compensation for their troubles.  “This outcome leaves the parties where they stand. Neither side can recover from the other. Each must deal independently with the consequences of their costly and ill-fated attempt to merge,” the ruling concluded.   While these proceedings come to a close, the House of Representatives passed a bill that would repeal a law protecting payers from certain anti-trust regulations. Payers stood firmly in defense of the law—known as the McCarran-Ferguson Act of 1945—on the grounds of maintaining state regulatory power over the payer industry.    The timing of these rising tensions coincides with an American Medical Association report on payer consolidation. The report found heightened payer consolidation activity in the past five years, resulting in a 56 percent increase in the industry’s consolidation.


July 30, 2020

Thanks to a photographer in the front row, we all got a peek at the White House’s unreleased drug-pricing order

President Donald Trump signed four drug-pricing executive orders on Friday, but the White House has refused to release the text of the most controversial order that aims to reduce the amount Medicare pays for some high-cost outpatient drugs. Trump said during the White House event that the order would go into effect a month after signing.

“But the fourth order, we’re going to hold that until August 24, hoping that the pharmaceutical companies will come up with something that will substantially reduce drug prices,” Trump said Friday.

Trump held up the order for a photo op after signing it, and the text of two out of the order’s three pages was visible in a photo taken by Associated Press photographer Alex Brandon and reviewed by Modern Healthcare.

The visible text of the order details that presumably the HHS secretary would be directed to “implement his rulemaking plan to test a payment model pursuant to which Medicare would pay, for certain high-cost prescription drugs and biological products covered by Medicare Part B, no more than the most favored-nation price.”

The text of the order indicates the White House may pursue a more aggressive version of international reference pricing than it first proposed in October 2018.

The 2018 policy would in part tie Medicare Part B payment to the average price of a market basket of developed countries, while a most-favored nation approach could give the United States the lowest price out of a selected market basket.

The order text seems to line up with prior comments by HHS Secretary Alex Azar, who said in November 2019 that Trump was “not satisfied” with the average international price approach, and instead wanted the United States to get “the best deal.”

The text said the purpose of the demonstration would be to see if a most favored-nation pricing demonstration would “mitigate poor clinical outcomes and expenditures associated with high drug prices.”

So far, HHS has only proposed an advance notice of proposed rulemaking on its international reference pricing plan, and would have to propose a rule and finalize it before the policy could take effect. The proposed rule has languished under review at the White House budget office since June 2019. The rulemaking timeline makes it highly unlikely that it could be finalized by the end of Trump’s first term.

The visible text does not detail how a “most-favored nation price” would be calculated, and does not indicate any deadline for implementation. It is possible that a details or a deadline were listed on the obscured page of the order.

The White House declined to comment on the partial text.

Trump said he planned to meet with drugmakers this week, but a meeting has not occurred. Pfizer Chairman and CEO Albert Bourla told investors on Tuesday that he was not interested in meeting with the White House to discuss the order.

“I don’t think there is a need for, right now, for White House meetings,” Bourla said.

We will keep a close eye on these pharmacy initiatives to lower costs to see if any will be viable or implemented in 2020.   I will not be holding my breath!   We will discuss this in our free Webinar Next week – August 6th at 12 noon EST.   You can register for this event on the “Events Tab” on my webpage.

July 28, 2020

The meeting Trump promised for today…. is off.  Top Pharmaceutical Manufacturers refuse to go!  The executives at the major drug producers were scheduled to meet with the Trump Administration to discuss his executive order issued Friday – but canceled.  Trump has given the drug-makers a month to present a better option to his “Most favored Nation Pricing” which is intended to link Medicare payments for certain medication to lower costs paid abroad.    Pharmaceutical manufacturers were sent scrambling on Friday.  

July 27, 2020

The Trump Administration Signs 4 Executive Orders On Drug Prices

On Friday, July 24, 2020, the Trump Administration announced four executive orders aimed at lower drug prices, but they will likely offer minimal relief to payers and here is why…

The orders signed Friday afternoon overall, aren’t new and aren’t as meaningful as the White House lets on.  Two of the orders, one to allow certain drugs to be imported from Canada and the second –  making changes to the way discounts are negotiated by pharmaceutical insurance carriers (pharmacy benefit managers or PBMs) are passed on to Medicare patients… both may take months to implement, if they’re implemented at all.

The most radical order involves requiring Medicare to pay the same price for some drugs that other countries pay.  However, Trump said he is giving the pharmaceutical industry until Aug. 24 to make a deal with him before he implements it.   “We may not need to implement the fourth executive order, which is a very tough order,”  Trump stated. The administration did not send this executive order to reporters and it was not immediately clear whether he even signed it. Trump said he will be meeting with pharmaceutical executives on Tuesday (7/28/20).   This seems to me- Trump trying to make good on a campaign promise he made three and a half years ago with no meaningful progress.

June 29, 2020

Looking ahead at this week going into the Fourth of July Holiday, Thursday is the much anticipated June Jobs report – initial jobless claims will undoubtedly be of interest to everyone…  ironically it is also  “World UFO Day”…   there is a funny twist there somewhere…


June 22, 2020

Mercer Survey – Work From Home Post Pandemic:

June 19, 2020

Turning Insight into Action!

“I love paying too much for medical insurance…”  said no one… Ever

How do we ensure health insurance is affordable as we navigate through these tough times?

Since I started my career in healthcare in 1990, we have been focused on “what is”. What if we changed that focus to “What could be”? In the next decade, I believe the way we access healthcare will change dramatically from the Treatment of disease – to the Prevention of Disease. The medical advancements coming will most certainly change how we receive medical care…. And it’s about time! Let’s explore together.


This Month’s News Articles below we are sharing:

Ø 150 New Drugs Coming to Market – What’s on the Horizon?
Ø Manufacturing Challenges – Survey Results

Employers are facing challenges as they never have before. COVID19 has presented us with unpredictability. The US healthcare system is in a period of changes as well. Many hospitals with ICU beds and ventilators are strained for capacity – while other healthcare facilities are facing worker layoffs and furloughs due to the decline in nonessential healthcare services. This is what is creating significant uncertainty in employer healthcare costs in 2020 that will spill over into 2021. The potential continual viral waves and spread of the virus will be a key cost indicator.

Employers are left trying to estimate the increased cost of treating COVID19 while weighing the downturn in claims due to care deferral. We grapple with how this delay in care will potential worsen disease states in our covered employee population- resulting in a boomerang effect on costs in the coming months. Financial modeling tools can help in establishing new budget projects but employers are certainly facing unpredictability in projecting their future healthcare costs. With our clients, we are sharing our COVID financial model which utilizes client specific data to assist in this planning process. We continue to focus on areas to improve pricing, clinical programs and high cost claimant management with new strategies using the marketplace advancements.

Staying focused and abreast of new strategies is our job.
Turning Insight into Action is the only path forward.

Pharmacy is and will be the key driving of costs both in the general population and in managing our high claimants. In 2020, COVID19 has impacted the timing of new-to-market drugs in the FDA approval pipeline.

So what does 2020 and 2021 look like in the RX Pipeline? COVID19 therapies are taking precedence in the approval process and this “fast-tracking” may delay the FDA review of other pharmaceuticals. We currently anticipate over 150 new drugs will be evaluated by the FDA this year. Currently 64 drugs have been filed with anticipated FDA approval dates in 2020. Eleven are potential blockbusters with expected $1 billion in U.S. sales. A few “big” new to market therapies include Risdiplam which is slated to be approved in late August 2020. It is an oral gene-splicing intervention to correct muscular atrophy. It will compete with two other drugs we watched hit the market last year:
Zolgensma costing $2.1 million for a one time treatment and
Spinraza costing $750,000 the first year and $375,000 annually after the initial treatment.
The manufacturer of Risdiplam said it will be less expensive than the two treatments mentioned here.
Another new therapeutic drug approved on April 22, 2020 is a treatment for breast cancer and being considered for other types of cancer treatment called Trodelvy with an estimated cost of $2,000 per treatment.
A new Hemophilia treatment is also slated for August FDA review that is estimated to cost over $3M.

Heading into benefit renewal season… Hold on tight. This one is going to be different than any other!
One day, you might compare working in an office to remembering someone’s phone number—something you don’t have to do anymore!


Sharing an article for our manufacturing clients:
Top HR Challenges in Manufacturing
As the manufacturing industry rebounds from the coronavirus, it will have to overcome skills gaps, retirements and an image problem.

By Tamara Lytle May 27, 2020
Before the coronavirus upended the global economy, U.S. manufacturers were facing a shortage of workers. In fact, Deloitte and the Manufacturing Institute estimated in a 2018 study that as many as 2.4 million factory jobs could remain unfilled through 2028 because of a tight labor market and a lack of people with the needed skills.
Now, the economic expansion in the U.S. has been reversed in sudden and dramatic fashion and the labor market has been upended. As the pandemic wreaked havoc on public health and the economy, some factories were shuttered to avoid the spread of the virus. Manufacturing output measures dropped sharply as the disease spread. Consumer demand for big-ticket items dropped. Disrupted supply lines from China and elsewhere slowed production.
Meanwhile, HR departments scrambled to deal with the new landscape, sorting out staffing demands and interpreting new regulations on paid leave. They established rules on access to facilities, including temperature checks and social-distancing requirements for employees, and new processes for clocking in and out.
Baby Boomers working in the manufacturing industry will retire in the next decade.
At the same time, companies making crucial supplies, such as protective masks for health care workers, scaled up production to meet skyrocketing demand. Others revamped operations to make ventilators and other vital products. Meanwhile, sectors such as food and beverage saw increased demand as the public stayed home.
The virus also exposed faults in the international supply chain that in the long term may lead to expanded U.S. production of medical supplies, prescription drugs and other items.
Manufacturing, like the global economy, is on uncertain ground. It will take months, if not years, for operations at some plants to rebound. The demand for new workers is likely to be soft during the early stages of the recovery. Still, the biggest challenges many HR leaders in manufacturing cited before the pandemic will remain, including a tide of Baby Boomer retirements and the negative view of manufacturing among younger workers.
Pandemic Upends Manufacturing
The coronavirus sent shock waves through the world economy and manufacturing. In March, the sector experienced the largest monthly decrease in output since 1946, and the downturn left companies on uncertain ground.

Sources: Board of Governors of the Federal Reserve System (April 2020) and the National Association of Manufacturers (March 2020).
Transitioning to High-Tech
The National Association of Manufacturers (NAM) recently launched a campaign to pump up interest in manufacturing jobs. “Too few people know what’s in the big buildings that line the highways,” says Carolyn Lee, executive director of the Manufacturing Institute, an affiliate of NAM.
NAM has raised $14 million from manufacturers to launch a social media and marketing campaign, called Creators Wanted, to attract workers. One important goal, Lee says, is to draw more women, veterans and other underrepresented populations to the industry. While roughly half of the overall U.S. labor force is female, just 29 percent of the nation’s nearly 13 million manufacturing jobs are filled by women, according to Lee.
When her father and grandfather worked in manufacturing, the jobs were physically demanding. Now, though, “these are not necessarily manual labor jobs,” she says. “There’s a place for everyone.”
New technologies are helping make that transition possible. “Companies are planning and investing in the next three years for enterprise-wide solutions, so they have factories that are wired and smart,” says Luke Monck, senior manager in Deloitte’s manufacturing practice. “We’re at the cusp of that.”
In the near term, that means fewer employees will be needed for some functions that can be done by robots. But when sensors are used to measure a machine’s operations, for instance, someone still needs to install the sensors, understand the resulting data and create a dashboard so managers can track productivity. People with these skills are in short supply.
“These aren’t people who work in the factory today,” Monck says.
So how does HR find that talent? How does it attract, retain and engage a digital workforce, all while keeping the old manufacturing system running?
‘We’re leading-edge.
It’s not your grandfather’s manufacturing.’
By Suzanne Morrison
Part of the answer will involve adopting a less hierarchical structure that empowers workers and allows them to see beyond their own tasks, Monck says. “Smart factories will be awash in data, so everyone will need to be making strategic decisions. It’s the democratization of data.”
Career-progression planning will be tailored to lower-level workers, and many employees will move laterally within an organization in order to learn a broad set of skills.
Performance management systems will need to move from objective measurements to value-based assessments, Monck says. For instance, instead of rating a worker on the ability to produce 100 widgets, a new evaluation may assess how the employee was able to improve efficiency by programming a robot to produce 500 widgets.
HR leaders will need to understand the tech road map for their organizations and then update job descriptions and staffing plans to get where they want to go. According to the Deloitte study, 47 percent of manufacturing jobs will be gone in the next decade because of the shift to more technology. Overall staffing will be higher, but the jobs will be different. There may be 20 percent fewer assembler jobs, but new workers will be needed to program the corresponding machinery.
Finding and Developing Workers
Restless workers haven’t helped manufacturers close the skills gap. That trend, however, is likely to be tempered by the pandemic.
“It feels like the workforce lately is looking to move quickly through things rather than spend the time to become skilled in the position,” says Dawn Kubiak, HR manager at Grafton, Wis.-based Kapco Metal Stamping, which makes components for items ranging from military equipment to snowmobiles.
In response to the worker tendencies it was observing, Kapco’s HR team revamped its employee development plan. The process, which lasts 24-36 months, spells out how workers can develop their skills as well as boost their compensation over the long term. The effort has resulted in reduced turnover and increased engagement and communication, according to Kubiak. “They can own some of their own success and career path,” she says.
Kapco’s recruiters check in with new hires early on to see how they’re doing and identify potential problems. The company also uses a buddy program, pairing more-experienced workers with new employees to help them assimilate faster.
All of that helps boost retention, but the skills gap has also prompted the company to rethink its approach to hiring. “It’s not all skill,” says Jennifer Wenger, senior director of talent and organizational development at Kapco. “Our hiring is no longer [just about] what you know in metal stamping and manufacturing. It’s about what attitude do you bring every day when you walk in.”
It’s critical for companies to be more creative when it comes to hiring. NAM’s Heroes Make America initiative is designed to help veterans transition into manufacturing jobs. A military mortar operator might never have worked in a plant. But he or she has had a job where precision, teamwork and communication were vital. Those are perfect traits for some factory jobs like quality control, Lee notes.
Julie Mann, senior corporate HR director at Neogen Corp. in Lansing, Mich., thinks a lot about the ideal candidate, where to find him or her (at a college robotics competition, perhaps), and how to initiate contact. “They’re not out there looking for us,” she says.
Neogen, a food safety products manufacturer with 1,800 employees worldwide, has a digital strategy to pinpoint potential workers. The HR department uses a local television station’s Facebook page to target job ads geographically—such as within a 30-minute drive of the plant—or based on an individual’s interests. (It’s the same technology that bombards shoe shoppers with ads after they’ve been browsing sneakers online.)
“It’s crazy how well it works,” Mann says, noting that clicks on her targeted job ads are 25 percent above expected rates. In January, a Facebook ad for a warehouse worker job drew interest from 76,000 people online. “I can’t get that with anything else,” she says.
Retraining and Retaining Talent
For many manufacturers, a crucial strategy for closing the skills gap is retraining current workers.
At Hatch Stamping Co., a Chelsea, Mich.-based supplier to the auto industry with 1,250 employees around the world, there’s no place like home—or the plant floor—when searching for talent. With die setters nearly impossible to find, Judi Wooten, vice president of administration, looks for employees with good mechanical skills and arranges to train them as die setters.
She’s found workers with other skills, too. Once, she was chatting with a manufacturing worker who mentioned he was taking technology classes. Now he’s doing well in the IT department.
In addition to retraining, Hatch Stamping also focuses on retaining skilled workers. Small gestures can make a difference, say Wooten and Suzanne Morrison, the company’s director of marketing. Breakfast with Santa each year includes gifts for employees’ children. Workers with perfect safety records get a free lunch. And employees love receiving a free turkey at Thanksgiving. “We treat them like family,” Morrison says.
Keeping pay levels competitive is another important retention tactic. Each November, the company benchmarks current positions and brings wages up to market level as needed.
Tips for HR Practitioners in Manufacturing
Tap into local high schools and colleges to get the word out about manufacturing careers; open the factory to tours.
Communicate with local educators about what skills are needed from future graduates.
Change job descriptions to focus less on a job candidate’s past positions and more on what’s really needed to do the job—including tech skills—so good candidates aren’t disqualified.
Recruit populations underrepresented in manufacturing, such as women and veterans.
Beef up apprenticeship programs.
Automate jobs that are going unfilled.

Saying Goodbye to Boomers
Demographic trends present one of the biggest challenges to manufacturers. In the next decade, Deloitte estimates that 2.6 million Baby Boomers in the industry will retire.
“We’ve been talking about a talent tsunami, and now we’re seeing that happen—the older workforce is entering retirement,” Monck says.
To facilitate a transfer of knowledge, companies are pairing seasoned workers with younger ones. Kapco, for example, allows older employees to switch to part time as they near retirement in order to retain their knowledge and have them serve as mentors.
Neogen pairs older workers with those who are likely to stick around longer, which Mann points out is a smart business practice anyway. “Any of us can be hit by a bus tomorrow, so cross-training is huge,” she says. Transferring knowledge before workers leave is a way “to learn not just what they do but how they do it and why they do it.”
Improving Manufacturing’s Image Problem
As Baby Boomers leave the workforce, manufacturers know the industry has a bit of an image problem with younger workers—and with their parents.
“There’s still that misperception that you can’t have a great career without going to college,” Mann says.
Part of the challenge of drawing young people to the factory floor is convincing their parents that manufacturing holds promise, say Mann and other HR professionals. When Neogen offered a program for high school students to work in manufacturing jobs part-time during their senior years, it invited their parents to the orientation as well.
“All these people are going to college and then realizing they don’t like it but have racked up college debt,” Mann says. “If parents understand the child could leave high school and get into a trade making as much money as they would have their first year out of college—without the college bills—they would be more prone to go that way.”
Outreach efforts also need to involve convincing younger generations that vocational training is a valid choice. “The skills gap is not going to be closed by everyone going to college and becoming a mechanical engineer,” Monck says.
“Dumb, dirty and dangerous” has been the rap on manufacturing in some quarters, he says. Millennials, in particular, tend to view the sector as hierarchical and short on technology. “All of those things have changed and are changing,” Monck says. “The smart factory is allowing Millennials to see the outcome of what they do every day in what the organization is trying to achieve.”
HR leaders at many companies have become public relations agents for their industry. “We’re leading-edge,” Morrison says. “It’s not your grandfather’s manufacturing.”
Neogen, like Hatch Stamping, offers tours for students and their teachers as part of Michigan’s statewide manufacturing day that draws busloads. “We’re trying to get high school students’ eyeballs on manufacturing,” Mann says. “A lot of it is getting information into their hands before they need a job—getting them to think about what the job looks like.”
Julie Mann
Kapco in Wisconsin has embraced younger generations by giving students tours, sending speakers to high schools, joining a state youth apprenticeship program and talking up the technology the company uses. These efforts reinforce the message that the operation “is clean, it’s bright, it’s state-of-the-art technology, it’s safe,” Wenger says.
Companies also need to appeal to younger potential workers by highlighting the value of the work. Neogen, for instance, emphasizes its role in protecting food safety. “We call it being part of the mission that matters,” Mann says. “That’s more and more important to people: working for a company where they believe in what it’s doing. We’re all getting more purpose-driven, but it’s particularly important for the Millennial group.”
The strategy to fill jobs needs to focus on the narrative of why those positions are worthwhile, Lee says. Creativity, flexibility and storytelling about why the jobs are important can go a long way toward finding the right people to keep production lines humming as the economy and manufacturers regain their footing.
Tamara Lytle is a freelance writer in the Washington, D.C., area.
Illustration by Orlando Hoetzel.


February 2020

Bloomberg Law Article:


Insurers Move to Blunt Employers’ Use of Alternate Drug Plans

Jan. 22, 2020, 5:45 AM

Major health insurers are forcing small and mid-sized employers to use the insurers’ pharmacy benefit management services, a move that is preventing the employers from taking steps to reduce their medication costs.

Benefits consultants and insurance brokers say insurers like Aetna Inc. and Cigna Corp. are keeping employers from reaping sizable savings, in some cases by threatening them with punitive administrative fees if they abandon the insurers’ PBMs.

The gambit comes as employers are under intense pressure to hold down rising drug costs. National spending on retail drugs totaled $335 billion in 2018, 2.5% higher than in 2017, according to the Centers for Medicare & Medicaid Services’ National Health Expenditure data. The 2018 increase accelerated from the two previous years and didn’t include many specialty drugs, which are often administered in doctors’ offices or in hospitals.

Many companies that self-insure their employee health plans elect to combat escalating drug prices by “carving out” their pharmacy benefits. That means separating drugs from other medical coverage, typically by using a PBM that isn’t part of the health plan administered by insurers.

PBMs manage drug benefits for employers and negotiate drug prices with manufacturers with the stated goal of saving employers money. But in recent years PBMs have come under fire for their practices, such as not giving consumers the full benefit of negotiated rebates.

Barring Carve-Outs

A top executive for the benefits consultancy Trion said Aetna and Cigna last summer stopped allowing Trion’s employer clients with fewer than 1,000 workers to separate their pharmacy business if they wished to continue using the insurers as medical plan administrators.

Marybeth Gray, Trion’s senior vice president of health and welfare consulting, made her remarks at a December conference in Washington.

“That’s been a strategy for employers to negotiate better pricing, better terms, and a more focused approach to pharmaceuticals,” Gray said of the ability to choose another PBM.

In 2018, Aetna Inc. was acquired by CVS Health Corp. and Cigna Corp. bought Express Scripts Holding Co. CVS and Express Scripts are two of the largest PBMs in the country.

Aetna spokesman Ethan Slavin said in an email that the insurer “does not have any sort of policy that would prevent employers from carving out pharmacy benefits.”

“We do have some employers that keep the health and pharmacy benefits integrated, but that is solely their decision and they have the capability to separate pharmacy benefits if they would like,” Slavin said.

“We often find that there are a number of factors that determine what approach an employer will take, including the size of the company and whether they are fully insured (where Aetna is responsible for the risk) or self-insured (where the employer is responsible for the risk),” he said.

Companies that buy fully insured health plans generally don’t have the option of carving out pharmacy benefits, according to health insurance brokers.

Cigna didn’t respond to a request for comment.

Whether the insurer-PBM mergers are good for plan sponsors has yet to be seen, Julie Stone, managing director of management consulting firm Willis Towers Watson, said in an interview.

“With this reintegration, there’s an opportunity for CVS-Aetna, Cigna-ESI, UnitedHealthcare-Optum to demonstrate a new value proposition that has both a patient health improvement and a financial component,” she said.

“Our point of view is you need to show us evidence of the value” in keeping pharmacy benefits integrated with medical plan management, Stone said.

Making it Hard to Switch

Insurers make it difficult for companies to carve out their pharmacy benefits, David Contorno, founder of health insurance broker E Powered Benefits based in Charlotte, N.C., said in an interview.

A common practice is to sharply raise administrative fees charged by the insurer to administer a company plan if the plan doesn’t use the insurer’s PBM, he said.

That “would force or require the employer to capitalize upon that lower admin fee” by keeping the insurer’s PBM, which is highly profitable for insurers, Contorno said.

PBMs make money through administrative fees, rebates, and through spread pricing. By managing drug formularies on which plan benefits are based, they may negotiate rebates for expensive brand name drugs rather than using less expensive drugs, which raises costs for plan sponsors. Often the full rebates aren’t shared with plan sponsors or consumers, Bill Miller, chief executive officer of Chandler, Ariz.-based PBM Drexi Inc., said in an interview.

In addition, PBMs may pay pharmacies less than what they charge plan sponsors, keeping the “spread” between the two, Miller said.

New PBMs, such as five-year-old Drexi, have sprung up in recent years in reaction to the dissatisfaction many employers have with large PBMs. Drexi charges only a set fee per member per month and it uses 65,000 pharmacies, Miller said.

Saving $200,000 a Year

The savings for small employers that are able to use a PBM of their choosing can be substantial.

Wagstaff Inc., a 500-employee manufacturing company in Spokane Valley, Wash., switched from using Premera Blue Cross as its health plan administrator to UnitedHealthcare for its 2019-2020 plan year, Wade Larson, director of human resources, said in an interview.

The switch allowed Wagstaff to contract with an independent pharmacy benefit manager, RxBenefits Inc., which enabled the company to develop strategies for controlling pharmacy costs, especially high-cost specialty pharmaceuticals, he said.

“The specialty drugs are killing us all,” Larson said.

In previous years, Wagstaff experienced double-digit increases, with pharmaceutical costs a major contributor, Larson said. The company expects to reduce its pharmacy spending from $957,000 under Premera, which used Express Scripts, to $754,000 in the 2019-2020 plan year using RxBenefits, he said.

Keeping pharmacy benefits as part of Premera’s plan made it harder for the company to know how much it was spending on pharmaceuticals and how much on medical claims, he said.

“I could not get the best drug deals, I could not negotiate anything different, I couldn’t go shopping, and it was very restrictive,” Larson said of Premera’s drug benefit.

Under its current pharmacy arrangement, the company has the ability to negotiate prices for both generic and specialty drugs and change its benefit design, Larson said.

Premera spokesperson Dani Chung said in an email that the insurer’s approach “is to deliver an integrated pharmacy and medical program. We believe that this allows us to deliver a better customer experience and control costs. “Integrating these benefits allows for the best clinical decision-making possible, producing better outcomes and more savings for our customers.”

Premera does support “a few customers” in carving out pharmacy benefits, Chung said.

To contact the reporter on this story: Sara Hansard in Washington at shansard@bloomberglaw.com



January 24, 2020

Happy Friday!  

In the news this week….. a New-To-Market Drug to treat Hemophilia at $2-$3 Million dollars may take the #1 spot as the world’s most expensive drug – ousting Zolgensma that was released in 2019…  

Don’t worry, the newsletter’s only going uphill from here. 

In this week’s edition…

  •   New Genomic Drugs Coming to Market
  •   New Opportunity for Self Insured Employers to “Fully Insure”       the expensive genomic treatments coming to market
  •    ACA’s day in court might be a ways off – post the presidential       election
  •  Top Business Risks for the next decade being discussed at the   World Economic Forum in Davos this week.


Genomic Drug Therapies – What are they?


Gene therapy replaces a faulty gene with a working one to treat, prevent or even “fix” the disease causing genetic problem. These gene therapies have been tested for diseases like blindness, muscular dystrophy, leukemia and sickle cell disease. The impact of these treatments are life altering for patients who suffer from these aliments… but they come with an extraordinary price tag that employers are left to solve for. 

Last week at the J.P.Morgan Healthcare Conference – Drug manufacturer – BioMarin Pharmaceutical Inc. announced its new experimental gene therapy for hemophilia patients will be priced between $2 – $3 Million dollars if it is approved. This would then take the number one spot of most expensive drug in the world.  BioMarin’s Chief Executive, Jean-Jacques Bienaimé said in an interview that his company had spoken to insurers, who have indicated they are comfortable with the price range.  (I know what you’re thinking and I thought the same thing!)

Possible solution? 

With more gene therapy drugs coming to market with big price tags, Express Scripts Inc (ESI), the country’s largest Pharmacy Benefits Manager (PBM) -owned by Cigna, has announced a fully insured program (Embarc) to help employers pay for Zolgensma ($2.1 M dollars for the one-time treatment) and Luxterna (treatment price of $850,000). ESI has advised a launch of this product in the February / March time frame.

CVS Health / Aetna has also announced a Fully Insured Gene Therapy Program:  Aetna stated in a press release this week they will be offering a fully insured gene therapy product to launch April 2020. In the statement, they offered that the program will use a value-based contract model with manufacturers.   More to come on this.  Anthem has also stated they are working on a program for gene therapies for their clients.

ACA’s day in court is delayed….


Supreme Court rejects a fast-track review of health care suit

The Supreme Court refused Tuesday to consider a fast-track review of a lawsuit that threatens the Obama-era health care law, making it highly unlikely that the Justices would decide the case before the 2020 presidential election.

The court denied a request by 20 Democratic States and the Democratic-led House of Representatives to decide quickly on a lower-court ruling that declared part of the statute unconstitutional and cast a cloud over the rest.

Defenders of the Affordable Care Act argued that the issues raised by the case are too important to let the litigation drag on for months or years in lower courts, and that the 5th U.S. Circuit Court of Appeals in New Orleans erred when it struck down the health law’s requirement that Americans have health insurance. The justices did not comment on their order. They will consider the appeal on their normal timetable and could decide in the coming months whether to take up the case.


News from the World Economic Forum in Davos:

The Global Risks Report, published by the World Economic Forum with support from Trion’s parent company – Marsh & McLennan, provides a rich perspective on the major threats that may impact global prosperity in 2020 and over the next decade.

The 15th edition of the report draws on feedback from nearly 800 global experts and decision-makers who were asked to rank their concerns in terms of likelihood and impact. This year’s report highlights important threads across the global risk landscape: intensifying confrontations, both between and within countries, as well as a heightened sense of urgency and emergency around some critical global problems.

Risk outlook: a sharper focus on environmental threats over the next 10 years.

Concerns about environmental risks have been rising over the last decade. For the first time in the history of the survey’s 10-year outlook, environmental threats dominate the top five long term risks by likelihood and occupy three of the top five spots by impact.

See list below:


January 17, 2020

This week the big news was the JP Morgan Healthcare Conference in San Fran where leaders in Healthcare across all fields came together to discuss investments in the future of healthcare in the U.S.    Heads of the largest Heath Insurers, Biotech Companies, Pharma and Government  -Seema Verma – head of Centers for Medicare & Medicaid attended,  along with many other prominent industry leaders.    

News from the conference: CVS CEO stated in an interview with Modern Healthcare Magazine that CVS rolling out 1,500 “HealthHUB Sites” in stores by 2021 was not in direct competition with the provider community.  (These expanded HealthHUBs are in addition to the roughly 1,100 MinuteClinics in stores throughout the country today.)   Some primary care physicians do not feel the same way.    Unlike MinuteClinics, the new HealthHUBs will provide expanded care with a focus on chronic diseases thus creating tension in some provider communities.

My 2 Cents – CVS sees the generational shift in our workforce -dominated now by Millennials – and is trying to capture that market with healthcare access without waiting for appointments.   

Google’s Project Nightingail – where the tech giant  amassed health records from Ascension facilities in 21 states – gathering data, including names and diagnoses, but did not notify patients or doctors about their secret data project until the Wall Street Journal reported the story.   Their leaders hailed it as a transformative venture to redesigning care around the patient where providers will have access to patient records at their fingertips in a way they have not seen patient history aggregated in the past.

My 2 Cents  When personal data is being shared – albeit to enhance outcomes and higher quality of care- that information gathering should be consented to by the patient and they should be aware of how their personal data is being shared and used.   Transparency is the key.

Pittsburgh based UPMC announced at the conference they will spend $1 Billion on bioscience development by 2024.  The focus will be an investment in new drug, diagnostic ad device development.

In other news this week:

  • UnitedHealthcare  posted annual earnings this week of +19%.  Its 4th quarter sales of $60.9 Billion up significantly.    The U.S. largest health insurer and PBM revenue growth is expected to continue with a focus on the increasing enrollment in the Medicare Programs they offer.
  • Fed Court of appeals will hear arguments on the suit filed by US Drug Manufacturers against the Trump Admin / HHS for their attempt to require manufacturers to disclose the cost of the Drug in advertisements. This disclosure requirements in the Direct-to-Consumer Advertising would be a first.
  • California looks at lunching its own prescription drug label by contracting with generic-drug manufactures. With a population of 40 million (1 in 3 are on the states Medicaid program for low-income healthcare) – this would be a nice pilot project if they can get it off the ground. The second step would be to potentially use this program commercially if it is successful.  Leverage will be key here….   The Governor of CA plan on pricing controls is similar to the plan from House Speaker Nancy Pelosi (also a Californian)
  • Drug Manufacturers raise prices on more than 400 drugs already in 2020! Including 2 blockbuster cancer treatments – Keytruda (Merck) and Opdivo (BMS)
  • American Cancer Society reported the US Cancer death rate has fallen 2.2% largest drop on record!

January 10, 2020

 Drug Manufacturers have raised prices on more than 400 drugs already in the early days of 2020…

Including two blockbuster cancer specialty medications. They are two medications administered by the physician so they will be running through your medical plan expense, not the pharmacy program. A Noteworthy news item that caught the attention of the press – good news from the American Cancer Society- the Cancer related death rate fell in The United States by 2.2% from 2016 to 2017. The rate has declined 29% since 1991 with 2.9 million fewer cancer deaths than if rates continued at the current pace. Unfortunately, Cancer is still the second leading cause of death in the U.S. after heart disease. With the new therapies and innovations in cancer treatments such as immunotherapy and others in development, we are all very hopeful a cure will be found in this new decade!

Both Republicans and Democrats have stated pharmaceutical prices will be a focus for them in 2020 on the campaign trail – so we will be hearing a lot about potential drug pricing legislation.

California is looking to launch its own prescription drug label by contracting with generic drug manufacturers as they try and tackle healthcare costs in the new year.

We will be reviewing all this news and other marketplace news on Pharmacy as well as the recently released employer survey data in our power lunch series as we head into the new year!


If you missed the Big News at the End of December – Here is a Recap!


The U.S. Senate on December 19 passed a government spending bill that repeals three Affordable Care Act taxes.

The three pieces of legislation included in the spending bill to avoid a government shutdown including a repealed three ACA taxes:

1. Cadillac Tax Repeal – a 40% excise tax on employer-provided health plans that exceed certain thresholds;

2. A Health Insurance Tax; and

3. The 2.3% Excise Tax on Medical Devices

These tax repeals, will cost federal taxpayers nearly $400 billion over the next decade, according to the Congressional Budget Office. The bill awaits the President’s signature which is believed to be targeted for signature tomorrow.

This major legislation did not include changes discussed to protect consumers from surprise medical bills and high drug costs. The deal will extend funding for several Medicare and Medicaid priorities for five months, which could be another vehicle for action on the issues in 2020. However, many lobbyists are skeptical that lawmakers will come together on bipartisan legislation just six months before a presidential election.

The permanent repeal of the excise tax on employer health plans, commonly known as the “Cadillac” tax, is a big win for employers.  As you know, the twice-delayed tax was set to take effect in 2022 unless Congress acted. Over 1000 businesses, business associations, labor unions, and others worked tirelessly to ensure that repeal was included in the final package.

Appeals court strikes down individual mandate but stops short of scrapping entire ACA


On December 18th, The 5th Circuit Court of Appeals’ ruled 2-1 that the individual mandate is unconstitutional but remanded the case back to a federal judge in Texas to determine how much of the landmark healthcare law must fall along with it. U.S. District Judge Reed O’Connor previously struck down the ACA in entirety.

What some observers saw as the appellate court’s unwillingness to get its hands dirty ensures that the lawsuit, known as Texas v. U.S., will drag on beyond the 2020 presidential election. While the ACA remains the law of the land, the uncertainty around its future could once again wreak havoc on the individual health insurance exchanges.

Current enrollment statistics on the public exchanges is between 11 – 13 million Americans. This does not included Medicaid.  Many industry experts were just seeing this marketplace stabilize.  This legislation and the ultimate outcome of this ruling on the fate of the exchanges in 2021 may disrupt the platform.

The 5th Circuit decision almost certainly will bring the health-care law before the Supreme Court for a third time, and California Attorney General Xavier Becerra, leading a coalition of his Democratic counterparts fighting to preserve the law, said Wednesday night that he was prepared to ask the high court to take the case before the lower court rules again. But by sending a thorny legal question back to the Texas jurist who already has held the law unconstitutional, the judges may effectively slow the progress of the case, so that the high court does not take it during its current term and decide it before the November elections.

Hospital, insurer and patient advocacy groups, along with Democratic lawmakers, lamented that the 5th Circuit was unwilling to determine whether entire ACA could stand without the individual mandate, noting that not doing so creates further chaos in the healthcare system and is harmful to Americans.

“Sending the decision back to the federal district court that invalidated the entire law puts health coverage—and peace of mind —for millions of Americans at risk,” Rick Pollack, CEO of the American Hospital Association, said in a statement.

Blue Cross and Blue Shield Association CEO Scott Serota echoed those sentiments, but he noted in a statement that the “court recognized the gravity of a challenge to the entire law and did not immediately rule to invalidate it.”

Had the 5th Circuit upheld a lower court’s decision in entirety, the consequences for millions of Americans and healthcare companies that serve them would have been far-reaching. The decision would have affected people who buy coverage in the individual market and those with coverage through Medicaid expansion, Medicare and from their employers.

October 4, 2019

Happy Friday!   Fun Fact for the day:

Uber in NYC,  launched Uber Copter, a helicopter airport service for those who want to travel like the Roys.   🙂   Sign me up!

Sad news for most- Part of the tariffs the U.S. is slapping on $7.5 billion of EU goods is a 25% tax on some of Europe’s finest wares: single-malt Scotch whisky, French wine, German brats, and Italian cheeses.    THAT hurts!

On to the business for the day – Healthcare!

Walmart  announced it plans to give workers financial incentives to use Higher-Quality Doctors (That’s a great Value-Based Plan Design!)

The new plan design will give employees who use ‘featured providers’ the ability to pay less out of pocket.   Fabulous!   See the full article below:

Walmart To Give Workers Financial Incentives To Use Higher-Quality Doctors

By Kaiser Health News

Employees who use ‘featured providers’ will pay less out of pocket.


Walmart is working with Embold Health of Nashville, that uses data to analyze whether doctors provide ‘appropriate, effective and cost-efficient care.’

Employer health experts said Walmart’s initiative with physicians is a groundbreaking step.

However, it also risks alienating doctors and upsetting employees who don’t want to change doctors.

This article was first published on Thursday, October 3, 2019 in Kaiser Health News.

By Phil Galewitz

Worried its employees aren’t getting good enough care from doctors in their insurance networks, Walmart next year will test pointing workers in northwestern Arkansas, central Florida and the Dallas-Fort Worth area toward physicians it has found provide better service.

If the employees use these “featured providers,” they will pay less out of pocket, Walmart officials said Thursday.

Walmart is working with Embold Health of Nashville, a recent startup company that uses data to analyze whether doctors provide “appropriate, effective and cost-efficient care.” Embold CEO Daniel Stein was a Walmart executive from 2013 to 2017.

“Rather than relying on word of mouth or social media to find a provider, patients can get information based on actual data and proven results,” said Lisa Woods, Walmart’s senior director of U.S. benefits.

Walmart, the nation’s largest private employer, would not disclose the percentage of its doctors in those geographic areas that have the new quality distinction or how much workers could save by using their services. The company hopes to take the program nationwide if successful, officials said.

About 60,000 employees and dependents in the three initial areas could be affected.

Ateev Mehrotra, associate professor of health care policy at Harvard Medical School, said Walmart’s strategy could raise questions about whether doctors are chosen more for lower cost or higher quality.

“This sounds awesome and great in theory, to identify the best doctors you have for your employees to go to, but what is in the black box formula that Embold Health is using, and how much is it the cost and how much is quality of care?” he said.

The effort to steer workers to certain doctors mirrors a similar approach Walmart uses with hospital care. Since 2012, Walmart has directed the 1 million employees and dependents on its health plan to better-performing hospitals for high-cost services, such as heart and transplant surgery.

While using these hospitals — including Mayo Clinic and Cleveland Clinic — may cost more than a local alternative, Walmart officials have said the strategy saves money by averting complications and unnecessary care. Several other large employers have followed a similar “centers of excellence” strategy.

Earlier this year, Walmart became the first large employer to direct its employees to diagnostic imaging facilities that it found provide more accurate care.

Employer health experts said Walmart’s initiative with physicians is a groundbreaking step — but is also fraught with risks such as alienating doctors and upsetting employees who don’t want to change doctors.

“It’s a bold move to use the data they have and share it with employees for their benefit,” said Steve Wojcik, vice president of public policy at the National Business Group on Health, a trade group of large employers. “It’s part of Walmart’s pattern to disrupt and transform health care for the better.”

Stein of Embold Health said his company uses various quality metrics that vary by specialty to rate physicians. The company shares its criteria with physicians, he said, so they know what areas they need to improve to get the quality distinction. This includes such measures as rates of cesarean sections for patients with low-risk pregnancies and infection rates for patients after elective knee or hip replacement, according to Embold Health.

Mehrotra noted, however, that it’s often difficult to identify which doctors provide the highest quality of care because most work in large groups where patients may see multiple physicians.

The initiative to identify better-performing doctors, he suggested, “can only be seen as a failure of their health plans,” noting that employers typically rely on the insurance companies that administer their plans to identify the best doctors for their networks.

Walmart’s test will include physicians specializing in primary care, cardiology, gastroenterology, endocrinology, obstetrics, oncology, orthopedics and pulmonology.

Walmart officials said the initiative is aimed at helping reduce the large amount of unnecessary care that doctors provide, which some studies say is as high as 30%.

“We hope to get a meaningful chunk of that removed from our costs and our associates’ costs,” said Adam Stavisky, Walmart’s senior vice president of U.S. benefits. “How much we can save? We don’t know, but we think it’s material.”

The initiative is one of several announced by Walmart officials Thursday, including pilot projects to expand access to telehealth doctors managing chronic care in Colorado, Minnesota and Wisconsin, and to help workers in North Carolina and South Carolina find doctors, provide assistance on billing questions or complex medical issues.

“It’s a bold move to use the data they have and share it with employees for their benefit.”

Steve Wojcik, National Business Group on Health

September 27,2019
Happy first week of Fall!  Although there is Daytime Emmy-Worthy Drama taking place in Washington DC this week, there are noteworthy happenings in Healthcare – which we are focused on here!

Pharma Manufacturer Novartis, received FDA Approval on May 28, 2019 for the most expensive drug in the U.S. to date. Zolgensma is a new gene therapy to treat Spinal Muscular Atrophy (SMA) in children less than 2 years old. The cost – at $2.125 Million is concerning to all.   Employers, Insurance Companies, Stop Loss Carriers and Consultants (to name a few) scrambled to understand this expense and how it would be managed.  Understand, these new gene therapies are going to become more common.  Two of the largest insurer in the U.S. released statements regarding their path to make these live-saving therapies affordable.   Both CVS Health and Cigna have released statements.


Cigna press release below:

Cigna Press Release: Breakthrough, potentially life-changing medicines offer great promise for patients and their families. However, the high prices of the medicines – millions of dollars in some cases – threaten coverage and access by patients who may benefit. Indeed, by 2024, the cost of gene therapies is expected to reach more than $16 billion in the United States.

Today, our health services business is introducing Embarc Benefit ProtectionSM a new offering that brings together the health services, medical benefit management and specialty pharmacy expertise of Express Scripts, eviCore, Accredo and CuraScriptSD to make breakthrough medicines more affordable and ensure access for those who need it.

Shielding Payers and Patients

Embarc Benefit Protection addresses a critical need facing the entire health care system, delivering better care, affordability and access.

Importantly, consumers will have no out-of-pocket payments related to the cost of the medicine and will receive personalized and expert care to assist them through their health journey.

Those who provide health coverage for millions of Americans, such as employers, health plans and unions, will have the peace of mind that comes from being better protected against the high price shocks associated with new breakthrough therapies.

Note from MB:   There are still many questions regarding these plans and how they might work for employers. It will address a very narrow number of treatments under this coverage. As these options progress in development, we will keep our clients aware of the options in the marketplace.



Walmart made the news several times in the last few days; first big splash made by Walmart with the announcement of its new Super Center for Healthcare!  It announced the first 10,000 square foot “Walmart Health” center to open in Dallas, GA. It is a health facility offering more services than the 19 “Care Clinics” Walmart already operates in Georgia, South Carolina and Texas.  Like CVS Health’s new expanded health in-stores option- where they have expanded the “Minute Clinics”, Walmart is hoping to capture consumers – mainly millennials looking for quick care options rather than waiting to schedule appointments with long waits to see a primary care physician in the traditional healthcare model.  They are also betting that the aging Baby Boomers will want the ability for opportunities for care in this quick setting. (Statistically, there are approximately 10,000 Baby Boomers aging into Medicare each day!) They are hoping to provide clinics for basic services with offerings for primary care, dental, optometry, counseling, laboratory tests, X-Rays, Hearing, Wellness and behavioral health.   CVS expanded minute clinic stores Healthcare Hubs business has over 50 locations and will grow to 1,500 locations by the end of 2021.  Walgreens is also testing various models in markets across the country with a partnership with Humana.  Many think this strategy is due to the decline of business in their retail due to giant competition from Amazon and the rapidly changing consumers.

A push to stop selling e-cigarettes: Walmart last Friday they announced they will stop selling e-cigarettes in stores (including Sam’s Club) in the wake of illnesses and deaths potentially tied to vaping.

From our Trion Compliance Department:

Medicare Part D Notice Reminder

September 23, 2019

The Annual Notice Deadline is October 14, 2019

Employer group health plans that include prescription drug coverage must provide a Medicare Part D creditable and/or non-creditable coverage notice (“Notice”), as applicable, each year to all Medicare-eligible employees and dependents before the annual October 15 Medicare Part D enrollment period. The purpose of this annual Notice is to notify Medicare beneficiaries whether or not their employer’s prescription drug coverage is at least as good as Medicare’s prescription drug coverage, in order to help them decide whether to enroll in Medicare Part D.

Take Action

Employers should review their prescription drug coverage to determine creditable coverage status and distribute the appropriate Notice on or before October 14. If a plan has multiple benefit options providing prescription drug coverage, the test must be applied separately for each benefit option.

Take Note and Give Notice

In order to assist employers with Notice requirements, the remainder of this alert provides additional background details including:

·    Which employers are subject to Medicare Part D Notice requirements;

·    Who is considered a “Medicare Part D eligible individual”;

·    Model Notices;

·    Notice deadlines;

·    Methods of delivery;

We will also address how to determine creditability when there is an account-based plan and creditable coverage reporting to CMS.

Trion Quarterly Pharmacy Newsletter is posted on my webpage:


Under Tab: News Releases

Click here to read the full alert

Cure for the common cold? Sneezing, Sniffling and Coughing with the common cold may soon come to an end!  Until now, we had chicken soup and waited it out… Researchers in California recently discovered a protein needed for the cold viruses to spread inside your body.  Get rid of the protein and get rid of the virus!  Scientists at Stanford University and the University of California in San Francisco have been successful in mice and hope this new breakthrough may be able to stave off your winter cold.   Very exciting!

Upcoming Events:   Marybeth will speaking in Tampa Florida on October 25th :


See you October 25th in Sunny Tampa, Florida!
The information contained herein is for general informational purposes only and does not constitute legal or tax advice regarding any specific situation. Any statements made are based solely on our experience as consultants. Marsh & McLennan Agency LLC shall have no obligation to update this publication and shall have no liability to you or any other party arising out of this publication or any matter contained herein. The information provided in this alert is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients. This is not legal advice. No client-lawyer relationship between you and our lawyers is or may be created by your use of this information. Rather, the content is intended as a general overview of the subject matter covered. This agency is not obligated to provide updates on the information presented herein. Those reading this alert are encouraged to seek direct counsel on legal questions. © 2019 Marsh & McLennan Agency LLC. All Rights Reserved

September 20, 2019

Marybeth Gray has been featured on the 2019 Marquis Whos’ Who Lifetime Achievement site below.


Marquis identifies and endeavors to profile the leaders of American Society; those men and women who are influencing their nation’s development and influencing the people of today in their industry.   We are proud to provide their biographical information for public record for posterity.

Sept 13, 2019

We all need a good laugh!

Good morning and happy Friday the 13th. Did you know that, according to Otis Elevator Company, as many as 85% of the high-rises in the world don’t have a 13th floor?

“People on the 14th floor, you know what floor you’re really on.”

Take it easy out there today…

Now for the serious stuff….

According to The Morning Brew:  Sadly, yesterday the Environmental Protection Agency repealed a major Obama-era environmental protection for streams and wetlands.

The backstory: Before 2015, the EPA decided case-by-case whether individual streams or wetlands had significant impacts on downstream rivers and were therefore subject to federal clean water standards.

  • In 2015, the Obama administration created federal pollution protections for ~60% of U.S. waters, including these smaller waterways.

Now, the EPA wants to go back to the old system. The repeal was Step 1: Next, it’ll create stricter requirements for what waterways can be federally protected.

Water they doing this for

The Trump administration says the 2015 rule stepped on states’ toes, was too broadly written, and made life unreasonably difficult for businesses.

  • To give you a clue who didn’t like it…the repeal was signed at the National Association of Manufacturers’s HQ. Farmers, miners, developers, and oil and gas companies also weren’t fans.

Zoom out: This is the Trump administration’s 7th trim of water pollution regulations. To date, it’s completed or is working on rollbacks of 84 other environmental rules.

Living in Southern Florida,  this saddens me due to the highly problematic water contamination issues we have been dealing with.    They potentially cause red-tide on many of the beaches in Florida- killing millions of fish and wildlife each year.

September 12, 2019

Fall brings us beautiful foliage in the Northeast but also produces storms due to the warm waters in our Oceans. We all watched in the past week the destructive Hurricane Dorian wreak havoc along our East Coast and for our neighbors in the Bahamas. Our hearts and prayers go out to everyone who has been touched by this storm.

Believe it or not, these storms that have been more prevalent in the past several years, may also impact our stop loss renewals. Many insurers that provide stop loss coverage also provide Property & Casualty Insurance. They have suffered losses due to these storms. In 2018, we experienced 14 separate climate disasters in the US – each over $1 Billion in cost! Couple that with the new specialty pharmaceuticals, gene therapy and immunotherapies on the market – some over $1 million dollars – and we have a bumpy stop loss renewal season ahead of us!

Yesterday, we presented a FREE 30 minute Power Lunch with a discussion on:

How New Million Dollar Therapies are going to affect our Stop Loss Renewals

* Overview of New Therapies
* Clinical Management approaches to Control Utilization
* Stop Loss Renewal Negotiation Tactics

Click here to listen to our Power Lunch Recording!

News Items This Week:

* The Food and Drug Administration last year approved its first autonomous, artificially intelligent medical device.
In a decision that seemed to take a page from science fiction, the FDA gave the OK to the IDx-DR, a device that uses artificial intelligence to analyze images of the back of a patient’s eye to detect if they have diabetic retinopathy.

* FDA approves a $2.125Million medicine for spinal muscular atrophy manufactured by Novartis – now the most expensive pharmaceutical on the market in the US.

* California Lawmakers Push for more transparency out of Kaiser


The Food and Drug Administration approved its first autonomous, artificially intelligent medical device that uses artificial intelligence to detect if they have diabetic retinopathy.

21st Century Cures Act driving FDA changes

Diabetic retinopathy occurs when high levels of blood sugar lead to damage in the blood vessels of the retina, the light-sensitive tissue in the back of the eye. Diabetic retinopathy is the most common cause of vision loss among the more than 30 million Americans living with diabetes and the leading cause of vision impairment and blindness among working-age adults.
“Early detection of retinopathy is an important part of managing care for the millions of people with diabetes, yet many patients with diabetes are not adequately screened for diabetic retinopathy since about 50 percent of them do not see their eye doctor on a yearly basis,” said Malvina Eydelman, M.D., director of the Division of Ophthalmic, and Ear, Nose and Throat Devices at the FDA’s Center for Devices and Radiological Health. “Today’s decision permits the marketing of a novel artificial intelligence technology that can be used in a primary care doctor’s office. The FDA will continue to facilitate the availability of safe and effective digital health devices that may improve patient access to needed health care.”

The device moved through the FDA’s approval process in a record 85 days under the agency’s de novo pre-market review pathway. The device was part of the agency’s Breakthrough Device Program, which was established as part of the Cures Act—a landmark piece of legislation signed into law during the final month of the Obama administration.


Most Expensive Drug in the US approved by the FDA

In late May 2019, the FDA approved the most expensive medicine to date for a rare disorder called spinal muscular atrophy. The Novartis manufactured drug treatment targets a defective gene that weakens a child’s muscles so dramatically that they become unable to move and eventually unable to swallow or breathe. It strikes about 400 babies born in the US each year.


California lawmakers push for transparency from Kaiser Permanente

Last week, CA lawmakers passed a union-backed bill that would force each of the health systems facilities to disclose its profits. The Democratic Governor of CA has until the end of this week to sign it into law. Currently, Kaiser reports a lump sum financial report for all 35 hospitals in its system.

Note from Marybeth: Any effort to afford purchasers more transparency into cost and pricing would be better for the consumers. I am hopeful that the Governor signs this legislation into law.

March 29, 2019

I posted the Trion Pharmacy Newsletter today under the “News Alerts” Tab of my webpage.  Pharmacy is the fasting growing piece of medical trend and I am hopeful we help you stay up to date on the changing environment in which we work!

As we run up to the next presidential election, it may be a very bumpy ride for healthcare in our country.  The focus on pharmaceutical costs and changes or elimination of ACA will be a key focus in the coming weeks.   The impact will be tremendous if the proposed changes occur (outlined below).

New York Times – March 27
What Happens if the ACA is Struck Down?
The Affordable Care Act touches the lives of most Americans. Some 21 million could lose health insurance if the Trump administration were to succeed in having the law ruled unconstitutional.
By Reed Abelson, Abby Goodnough and Robert Pear

The Affordable Care Act was already in peril after a federal judge in Texas invalidated the entire law late last year. But the stakes ramped up again this week, when President Trump’s Justice Department announced it had changed its position and agreed with the judge that the entire law, not just three pieces of it, should be scrapped.

A coalition of states is appealing the ruling. If it is upheld, tens of millions more people would be affected than those who already rely on the nine-year-old law for health insurance. Also known as Obamacare, the law touches the lives of most Americans, from nursing mothers to people eating at chain restaurants.

Here are some potential consequences, based on estimates by various groups.

People who could lose their health insurance.
Of the 23 million people who either buy health insurance through the marketplaces set up by the law (11.4 million) or receive coverage through the expansion of Medicaid (12 million), about 21 million are most at risk if Obamacare is struck down. That includes 9.2 million who receive federal subsidies.

On average, the subsidies covered $525 of a $612 monthly premium for customers in the 39 states that use the federal marketplace, HealthCare.gov, according to a new report from the Department of Health and Human Services. If the marketplaces and subsidies go away, a comprehensive health plan would become unaffordable for most of those people and many of them would become uninsured.

States could not possibly replace the full amount of federal subsidies with state funds.

Adults could lose Medicaid coverage.
Medicaid, the government insurance program for the poor that is jointly funded by the federal government and the states, has been the workhorse of Obamacare. If the health law were struck down, more than 12 million low-income adults who have gained Medicaid coverage through the law’s expansion of the program could lose it.

In all, according to the Urban Institute, enrollment in the program would drop by more than 15 million, including roughly three million children who got Medicaid or the Children’s Health Insurance Program when their parents signed up for coverage.

The law ensures that states will never have to pay more than 10 percent of costs for their expanded Medicaid population; few if any states would be able to pick up the remaining 90 percent to keep their programs going. Over all, the federal government’s tab was $62 billion last year, according to the Congressional Budget Office.

Losing free health insurance would, of course, also mean worse access to care and, quite possibly, worse health for the millions who would be affected. Among other things, studies have found that Medicaid expansion has led to better access to preventive screenings, medications and mental health services.

Medicaid spending for opioid addiction prescriptions has more than doubled.
The health law took effect just as the opioid epidemic was spreading to all corners of the country, and health officials in many states say that one of its biggest benefits has been providing access to addiction treatment. It requires insurance companies to cover substance abuse treatment, and they could stop if the law were struck down.

The biggest group able to access addiction treatment under the law is adults who have gained Medicaid coverage. The Kaiser Family Foundation estimated that 40 percent of people from 18 to 65 with opioid addiction — roughly 800,000 — are on Medicaid, many or most of whom became eligible for it through the health law. Kaiser also found that in 2016, Americans with Medicaid coverage were twice as likely as those with no insurance to receive any treatment for addiction.

States with expanded Medicaid are spending much more on medications that treat opioid addiction than they used to. From 2013 through 2017, Medicaid spending on prescriptions for two medications that treat opioid addiction more than doubled: It reached $874 million, up from nearly $358 million in 2013, according to the Urban Institute.

The growing insured population in many states has also drawn more treatment providers, including methadone clinics, inpatient programs and primary care doctors who prescribe two other anti-craving medications, buprenorphine and naltrexone. These significant expansions of addiction care could shrink if the law were struck down, leaving a handful of federal grant programs as the main sources of funds.

Americans with protected pre-existing conditions.
As many as 133 million Americans — roughly half the population under the age of 65 — have pre-existing medical conditions that could disqualify them from buying a health insurance policy or cause them to pay significantly higher premiums if the health law were overturned, according to a government analysis done in 2017. An existing medical condition includes such common ailments as high blood pressure or asthma, any of which could require someone buying insurance on their own to pay much more for a policy, if they could get one at all.

Under the A.C.A., no one can be denied coverage under any circumstance, and insurance companies cannot retroactively cancel a policy unless they find evidence of fraud. The Kaiser Family Foundation estimated that 52 million people have conditions serious enough that insurers would outright deny them coverage if the A.C.A. were not in effect, according to an analysis it did two years ago. Its estimates are based on the guidelines insurers had in place about whom to cover before the federal law was enacted.

Most Americans would still be able to get coverage under a plan provided by an employer or under a federal program, as they did before the law was passed, but protections for pre-existing conditions are particularly important to those who want to start their own businesses or retire early. Employers would sometimes refuse to cover certain conditions, and companies would have to decide if they would drop any of the conditions they are now required to cover.

The need to protect people with existing medical conditions from discrimination by insurers was a central theme in the midterm elections, and Democrats attributed much of their success in reclaiming control of the House of Representatives to voters’ desire to safeguard those protections. Many Republicans also promised to keep this provision of the law, although exactly how was unclear. Before the law, some individuals were sent to high-risk pools operated by states, but even that coverage was often inadequate.

Americans who no longer face caps on expensive treatments.
The 156 million Americans who get coverage through an employer, as well as the roughly 15 million enrolled in Obamacare and other plans in the individual insurance market, are protected from caps that insurers and employers used to limit how much they had to pay out in coverage each year or over a lifetime. Before the A.C.A., people with conditions like cancer or hemophilia that were very expensive to treat often faced enormous out-of-pocket costs once their medical bills reached these caps.

While not all health coverage was capped, most companies had some sort of limit in place in 2009. A 2017 Brookings analysis estimated that 109 million people would face lifetime limits on their coverage without the health law, with some companies saying they would cover no more than $1 million in medical bills per employee. The vast majority of people never hit those limits, but some who did were forced into bankruptcy or went without treatment.

Medicare beneficiaries would face changes to medical care and possibly higher premiums.
About 60 million people are covered under Medicare, the federal insurance program that covers people over 65 years old and people with disabilities. Even though the main aim of the A.C.A. was to overhaul the health insurance markets, the law “touches virtually every part of Medicare,” said Tricia Neuman, a senior vice president for the Kaiser Family Foundation, which did an analysis of the law’s repeal. Overturning the law would be “very disruptive,” she said.

Medicare beneficiaries would have to pay more for preventive care, like a wellness visit or diabetes check, which are now free. They would also have to pay more toward their prescription drugs. About five million people faced the so-called Medicare doughnut hole, or coverage gap, in 2016, which the A.C.A. sought to eliminate. If the law were overturned, that coverage gap would widen again.

The law also made other changes, like cutting the amount the federal government paid hospitals and other providers as well as private Medicare Advantage plans. Undoing the cuts could increase the program’s overall costs by hundreds of millions of dollars, according to Ms. Neuman. Premiums for as many as 55 million people under the program could go up as a result.

The A.C.A. was also responsible for promoting experiments into new ways of paying hospitals and doctors, creating vehicles like accountable care organizations to help hospitals, doctors and others to better coordinate patients’ care.

If the groups save Medicare money on the care they provide, they get to keep some of those savings. About 12 million people are now enrolled in these Medicare groups, and it is unclear what would happen to these experiments if the law were deemed unconstitutional. Some of Mr. Trump’s initiatives, like the efforts to lower drug prices, would also be hindered without the federal authority established under the A.C.A.

Young adults with coverage through their parents’ plans
The A.C.A. required employers to cover their employees’ children under the age of 26, and it is one of the law’s most popular provisions. Roughly two million young adults are covered under a parent’s insurance plan, according to a 2016 government estimate. If the law were struck down, employers would have to decide if they would continue to offer the coverage. Dorian Smith, a partner at Mercer, a benefits consulting firm, predicted that many companies would most likely continue.

Medical care for the uninsured could cost billions more dollars.
Doctors and hospitals could lose a crucial source of revenue, as some people lose insurance. The Urban Institute estimated that nationwide, without the A.C.A., the cost of care for people who cannot pay for it could increase as much as $50.2 billion.

Hospitals and other medical providers would incur losses, as many now have higher revenues and reduced costs for uncompensated care in states that expanded Medicaid. A study in 2017 by the Commonwealth Fund found that for every dollar of uncompensated care costs those states had in 2013, the health law had erased 40 cents by 2015, or a total of $6.2 billion.

The health insurance industry would be upended by the elimination of A.C.A. requirements. Insurers in many markets could again deny coverage or charge higher premiums to people with pre-existing medical conditions, and they could charge higher rates to women. States could still regulate insurance, but consumers would see more variation from state to state. Insurers would also probably see lower revenues and fewer members in the plans they operate in the individual market and for state Medicaid programs.

Menu labels are among dozens of the law’s provisions that are less well known.
The A.C.A. requires nutrition labeling and calorie counts on menu items at chain restaurants.

It requires many employers to provide “reasonable break time” and a private space for nursing mothers to pump breast milk.

It created a pathway for federal approval of biosimilars, which are near-copies of biologic drugs, made from living cells.

March 20, 2019
Happy First Day of Spring!
On the Spring Equinox- the day and night will be of almost equal duration in most time zones in the world!  Equal Day and Night…
For me, the time change of “Springing forward”, has left me a little sleepy!   On top of that, we have March Madness going on – I hope everyone has their winning brackets ready!!
Scroll down for the latest Healthcare news, and follow me on  Twitter @MBGHealthcare for more news and updates!
News Items This Week:
* United Healthcare Announces Rebates will go back to Customers at the Point of Sale
*UnitedHealth Loses Case to the Health Venture Begun by Amazon, Berkshire-Hathaway and JPMorgan Chase
*Amazon-Berkshire-JPMorgan Chase alliance reveals name for healthcare company – Haven
*Anthem – ESI  Divorce update: IngenioRX Client Transition
*We are Overweight as a Country: You won’t be hungry after reading this!
United Healthcare Announces Rebates will go back to Customers at the Point of Sale
Big News Continues in the Pharmacy World
After Seven Pharmaceutical Manufacturer CEOs went to Washington to attend a Senate Hearing on why prescription medicine is so expensive in the US and unaffordable to many, they (not surprisingly) pointed fingers back at the PBMs (carriers providing RX Coverage to employers and their employees).  United Healthcare, by far the largest Health Insurance Company in the US, responded with the strategy outlined below.
My Concern: Will this undermine the copay & cost share strategies we have painstakingly put in place to incent members to use lower costing prescriptions if they are going to give a discount to members on name brand and specialty drugs when they pick up their prescriptions at the drugstore?
Wall Street Journal – Mar 13
UnitedHealth to Require Drug Rebates Go to Consumers
The shift will involve employers that begin using the company’s pharmacy-benefit manager, OptumRx
By Anna Wilde Mathews
UnitedHealth Group Inc. said it would significantly expand a change to how it handles rebates from drugmakers by requiring new employer clients to pass them on to people who take the medications.
The move will apply to employers that sign new contracts after Jan. 1, 2020, but UnitedHealth will grandfather in existing clients that chose a different setup. The new shift will involve employers that begin using UnitedHealth’s pharmacy-benefit manager, OptumRx, including those that are self-insured, which is the vast majority of large companies.
Drugmakers routinely pay rebates to insurers and pharmacy-benefit managers to offset the full list price of brand-name drugs. The companies use the rebates in a variety of ways. Often, they are passed along to employer clients, which may use them to reduce premiums for all workers, or defray their own costs.
The move goes further than other major pharmacy-benefit managers, which haven’t made it mandatory to pass rebates on to consumers, according to UnitedHealth and industry consultants. The Trump administration has proposed a parallel approach that would affect Medicare and Medicaid plans, which pharmacy-benefit managers have generally opposed.
“We’re focused on making sure the value we’re negotiating on behalf of our clients is passed on to the consumer,” said John Prince, chief executive of OptumRx. The move to make the shift mandatory for new clients “is a huge statement to the market,” he said. UnitedHealth officials say the employer-plan situation is different from Medicare, where shifting the rebate treatment could force up premiums significantly.
UnitedHealth this year switched to passing along rebates directly to consumers under certain employer plans offered by its insurance arm, UnitedHealthcare, now affecting about nine million people.
The topic of rebates—along with the opaque process of setting prices for drugs in general—is currently under a bright spotlight, with pharmaceutical executives in a recent congressional hearing blaming the practices of insurers and pharmacy-benefit managers for driving prices higher.
On the other side, health plans and benefit managers have said they rein in costs by negotiating with drugmakers, including by winning rebates that could be used to reduce premiums.
But critics, including Trump administration officials, say the rebates should flow directly to the consumers who take the affected medications to reduce their out-of-pocket charges. UnitedHealth said its existing program to pass through rebates has lowered costs for affected consumers by $130 per prescription on average and increased their adherence to medication regimens.
A growing share of large employers pass along rebates to patients who take the affected drugs, according to a survey by the National Business Group on Health. Of the large employers surveyed, 20% were doing it in 2018, another 7% said they planned to start this year and an additional 31% were considering a shift in 2020 or 2021. Brian Marcotte, CEO of the employer group, said he believed the shift to passing rebates along to consumers “is the direction everything is going.”
Still, UnitedHealth risks pushback from employers that want to use rebates in other ways. “Some employers won’t like it, absolutely,” said Nadina Rosier, who is head of the pharmacy practice at advisory firm Willis Towers Watson . “They want flexibility to manage the benefit in the way they see fit, and the goal is to drive to lowest net cost.”
David Dross, leader of the pharmacy practice at Mercer, a consulting unit of Marsh & McLennan, said some employers might want the freedom to handle rebates the way they want and “they might base their decision about a PBM on that.”
Daniel J. Schumacher, president of UnitedHealthcare, said there is a “potential risk” in making the rebate approach mandatory, but “we think it’s a risk worth taking,” with major benefits particularly for consumers who take high-cost medications.
UnitedHealth Loses Case to the Health Venture Begun by Amazon, Berkshire-Hathaway and JPMorgan Chase
Feb. 22, 2019
UnitedHealth Group, the giant health insurance company, on Friday lost its case to prevent a former executive from working at the new health care venture formed by three powerful corporations, Amazon, Berkshire Hathaway and JPMorgan Chase.
A federal judge in Boston denied UnitedHealth’s request to have the executive, David William Smith, immediately stop working. Mr. Smith was an executive at Optum, a unit of UnitedHealth, and it accused him of taking corporate secrets to what it claimed was a competitor. Mr. Smith has denied any wrongdoing.
In its court filings, UnitedHealth argued that Mr. Smith’s role at Optum made him privy to sensitive information about its plans. Among Optum’s businesses is one of the nation’s largest pharmacy benefit managers, which serve as intermediaries between drug makers and employers that purchase medicine for their workers.
The industry has been sharply criticized for a lack of transparency in how pharmacy benefits managers operate, and Optum’s two main rivals recently merged with two large insurers, Aetna and Cigna.
While Judge Mark L. Wolf ruled against it, Optum emphasized that the issues remain unresolved and would need to be settled in arbitration. “We are committed to protecting our confidential information and will aggressively do so in arbitration,” said Matt Stearns, a spokesman for Optum, in an emailed statement.
A spokeswoman for the new venture, referred to as “A.B.C.” or “A.B.J.” in court papers, declined to comment. Unlike court proceedings, the arbitration sessions would not be public.
The case against the nascent venture has highlighted the anxiety of established insurance companies and pharmacy benefit managers over newcomers to their territory. From start-ups to giant technology firms, the new rivals threaten to unseat companies, like UnitedHealth, that have traditionally dominated these markets. Amazon, which has made tentative forays into the pharmacy business, has emerged as a particularly worrisome competitor.
The legal wrangling, which included testimony unsealed by the judge earlier this week, also revealed new details about the powerful triumvirate’s plans. While the companies have said that the new venture was not created to generate profits, they have been cryptic about exactly what changes they could make to lower costs and improve the quality of care for their employees. The company made headlines last summer with its choice of chief executive, Dr. Atul Gawande, a high-profile physician who writes for The New Yorker.
The court proceedings also underscored just how unhappy customers — particularly these three employers — are with the status quo.
“We’ve been asked to solve a very big problem, which is to figure out new ways of health care,” John C. Stoddard, a senior executive for the new venture, testified.
The three employers combined are spending about $4 billion a year on the roughly one million people they cover. But employee “have a poor experience,” Mr. Stoddard said.
“They’re not getting the care they need, and the costs continue to rise,” he said. “We wouldn’t exist unless there was a need to come up with and find a new solution to the problem.”
The venture, which has no name and fewer than 20 employees, plans to tackle several areas, including how benefits are provided through traditional health insurance plans, Mr. Stoddard said. High deductibles, which force employees to pay for significant amounts of their care before their insurance kicks in, are a hardship for “fulfillment-center workers and call-center workers,” he said.
The companies also want to see if they can lower the cost of drugs for chronic conditions. In his testimony, Mr. Stoddard insisted that the new venture had no plans to enter the pharmacy business but wanted to better understand the process and the actual cost of drugs.
“That doesn’t make us a competitor,” he said. “That makes us a very informed customer.”
The employers also want to make it easier for workers to see a doctor, Mr. Stoddard testified. Because Optum also operates a large network of primary-care doctors, the venture might want to work with Optum to provide employees with easier access to physicians.
“That’s why this is so crazy to me: that they think of us as competitors, when I see us as potential partners,”Mr. Stoddard said.
Amazon-Berkshire-JPMorgan Chase alliance reveals name for healthcare company
The joint healthcare venture between Amazon, JPMorgan Chase and Berkshire Hathaway finally has a name — Haven — and a new mission: to simplify health benefits for their employees.
The three companies revealed more information about their venture in a new website launched Wednesday, more than a year after announcing they would form an independent healthcare company for their U.S. employees.
Since announcing their intent to start their own healthcare venture last January, the three companies have remained fairly tight-lipped on details. But on Wednesday, Haven said it will be tasked with improving healthcare for the three companies’ 1.2 million employees and family members by creating “better outcomes and overall experience, as well as lower costs” for employees and their families, Haven’s CEO Atul Gawande wrote in a letter posted on the website.
Note from Marybeth: They are not envisioning competing with Insurers rather developing and deploying solutions and innovative ideas for their combined 1.2 million employees that they will then share with the market with the hopes of decreasing the cost of medical/Rx. “In time, we intend to share our innovations and solutions to help others.” They are non-profit – which means they are going to reinvest surplus into research and development. We will keep you posted on any developments!
Anthem /  ESI Divorce is Final!
Anthem announces the transition of clients to their PBM: IngenioRx
Are you being impacted by the Anthem/ESI divorce?
If you currently work with Anthem you will soon be receiving notice (if you have not already) Anthem will be transitioning their prescription drug management from Express Scripts Inc. (ESI) to their newly developed in-house Pharmacy Benefit Manager (PBM) solution: IngenioRx. IngenioRx is being powered behind the scenes by CVS with IngenioRx retaining the ability to control its own formulary.  Anthem believes that this approach will lead to significant savings and a growth in their underlying medical membership by offering an integrated medical/pharmacy solution (although that remains to be seen).
While IngenioRx may be able to achieve some of the projected savings the question is without fully evaluating the marketplace and the IngenioRx proposed contract – how can Employers be sure they are the ones benefitting from that savings and not just Anthem’s bottom line. Other questions remain like how a deal leveraging a partnership with CVS would yield more savings than a direct deal with CVS and how much Employer level control over the formulary remain. Rebates are a constant issue as well and understanding how those will be shared with clients is a key question.
With prescription drug being the fasting growing piece of our trend and making up 25% to 28% of your healthcare spend-  these changing dynamics may make this the right time to complete a review of the PBM space and compare pricing/contractual terms on a direct basis with the best in class PBMs. The Trion Pharmacy Practice can work with you and outside third party audit firms to help you complete that Assessment as well as assist with pre/post implementation and claims audits with any PBM you decide to contract with to assure contract compliance.
TheTrion RX Coalition trend for 2018 was 1.8%!!  We traditionally save our Clients between 15% to 20% but in some cases significantly more, want to learn more about the Trion Pharmacy Practice and how we can help you evaluate your pharmacy benefit?  Contact me at MBGray@Trion.com
Anthem Announcement:
March 7, 2019
As you know, on January 30, Anthem announced the accelerated launch of IngenioRx, our new pharmacy benefits manager (PBM), and that we would begin transitioning clients in the second quarter of 2019 and we expect to have all clients transitioned before the end of first quarter 2020. Our goal is to make this as easy as possible for your clients and their members. Most of the changes will be behind the scenes so there is very little that they should have to do. And, if there is something they need to do, we’ll let them know.
We have spent more than 15 months planning this transition and, based on the results of our rigorous testing, we are confident in our ability to transition your clients and their members with as little disruption as possible. More importantly, we are excited about the additional value we will be able to deliver with this move through things like improved pricing and enhanced member tools.
Due to contractual requirements, we must notify all clients directly. As outlined in the schedule below, we plan to notify all clients of their transition date on or before March 25.
  • The first round of notifications to clients transitioning in the first wave has already occurred.
  • A second round of client notifications will occur on March 18.
  • A third and final round of client notifications will occur on March 25.
If you have questions about the transition date for a specific client or set of clients, please contact your health plan representative.
We are overweight as a country:
You won’t be hungry after reading this. From 1986 to 2016, the number of entrees, sides, and desserts at the country’s biggest fast food chains has swelled 226%. But per a NYT summary
  • The average entree weighed 39 grams more and had 90 more calories in 2016 than it did in 1986.
  • A 2016 meal had 41.6% the recommended daily allotment of sodium, up from 27.8%.
  • The average 2016 entree and side accounted for close to 40% of a 2,000-calorie daily diet.
The study is more fodder for public health warriors’ crusade against fast food. This doesn’t bode well for the McDonald’s crew, which has been blamed for pushing the U.S. obesity rate among adults to 40% in 2016. Back in the early 1960s, it was only 13%.

March 19, 2019

Big Pharma went to Washington for the Senate hearing 2 weeks ago.   The seven pharmaceutical manufacturers pointed fingers back at the PBMs and the rebates -as the culprit for high drug prices.  (Not surprised – we saw that coming).   Late last week, UnitedHealth Group Inc. (the largest carrier in the US and owner of OptumRX (their own PBM) said it would significantly expand a change to how it handles rebates from drugmakers by requiring new employer clients to pass them on to people who take the medications.  (Not giving them back to employers.)  The move will apply to employers that sign new contracts after Jan. 1, 2020, but UnitedHealth will grandfather in existing clients that chose a different setup.

While this may appear they are “giving up the rebates from the drugmakers”, it may undermine the plan design cost shares we have painstakingly worked hard to set up to incent  members to use lower costing drugs.   More to come!

February 26, 2019

Big Day for Big Pharma!

Senate Hearing Today for  Big Pharma

This morning, many of the major drug manufacturer executives will testify in a highly anticipated (and in a rare united front of lawmakers on both sides of the aisle) Senate hearing, where they’ll attempt to defend the exploding cost of prescription drugs in the U.S.

Who’s on the guest list?

Top brass from Pfizer, Merck, AstraZeneca, Johnson & Johnson, Bristol-Myers Squibb, AbbVie, and Sanofi will face Senate Finance Committee Chairman Chuck Grassley (R-IA) and his fellow legislators.

The Issue at hand

Most think the drug makers will argue the industries malfunctioning reimbursement system is at fault. That system allegedly forces companies to hike prices then offer deep discounts (in the form of rebates) in order to win a spot on the insurance companies formulary or preferred list.

The stats are staggering

Recent estimates suggest total U.S. prescription drug spending will grow 60% from 2019 to 2027 to reach $576.7 billion.

An example of the cost explosion:  A vial of insulin that cost under $200 a decade ago now goes for about $1,500.   Osteopetrosis drug Actimmune costs $350/month in Britain…and $26,000/month in the U.S.

 Politics in play

Drug pricing is already a major issue for 2020 election cycle and reforming this industry will be a focal issue that is argued over the next several months.


Sharing an article below on the topic:

Wall Street Journal – Feb 26

Pharmaceutical Industry CEOs Face Senate Hearing on Drug Prices

Lawmakers are expected to pose questions about rebates and patents

By Jared S. Hopkins and Peter Loftus

Executives for some of the biggest pharmaceutical companies will visit Capitol Hill on Tuesday to face tough questions in a Senate hearing on the rising cost of medicines.

The executives lead companies with some of the highest-grossing drugs in the world, and have routinely raised prices on many of their products. Scheduled to testify are chief executives from AbbVie Inc.; Bristol-Myers Squibb Co.; Merck; Pfizer Inc.; AstraZeneca; and Sanofi SA. Johnson & Johnson, the world’s largest health-care company, is sending an executive who oversees its drug division.

Members of the Senate Finance Committee, chaired by Sen. Chuck Grassley (R., Iowa), are expected to question the executives on their pricing practices and how the companies can reduce costs for patients, according to people familiar with the matter. They are also likely to face questions about their strategies to fight off cheaper generic alternatives, according to the people.

The hearing could inform bipartisan legislation this year to target high drug prices. Sen. Grassley and Sen. Amy Klobuchar (D., Minn.) have introduced bills to legalize personal importation of lower-priced medicines from Canada, and to curtail patent-infringement-litigation settlements in which makers of brand-name drugs pay generic manufacturers to delay competition.

Americans continue to grapple with the rising cost of health care, including out-of-pocket costs for prescription drugs. In Washington, drug pricing may be one of the few issues that President Donald Trump and the Democrats could find common ground. While the pharmaceutical industry has for years been a major lobbying player, its critics are also spending millions of dollars to influence lawmakers.

On Tuesday, when senators ask about high list prices for drugs, expect the companies to respond by saying the prices aren’t meaningful because they don’t include discounts and rebates that companies give to pharmacy-benefit managers in order to gain plan coverage, said Ira Loss, senior health-care analyst at research firm Washington Analysis.

“The drug industry is going to come in and blame the pharmacy-benefit managers for the problems and say, ‘It’s not our fault,’ ” Mr. Loss said.

Industrywide, net prices have been falling as list prices rise, according to data from SSR Health. Few patients pay “list” prices, which don’t take into account rebates, discounts and insurance payments, but some pay the full price at times, such as when they haven’t met their deductible.

AbbVie’s rheumatoid arthritis treatment Humira is the top-selling drug in the world, and the company said that both volume and pricing fueled the drug’s growth during the fourth quarter. AbbVie raised the drug’s list price by 9.7% in January 2018 and then 6.2% more last month.

AbbVie has pledged to limit its overall drug-price increases to less than 10% annually, and only once a year, which the company says would be offset by rebates and discounts paid to insurers and other industry middlemen.

AbbVie Chief Executive Richard Gonzalez also may face questions about the company’s patent strategy. Humira’s main U.S. patent expired in 2016, but the company has fought off generic competition with a series of other patents and is expected to hold exclusive U.S. marketing rights until 2023.

New York-based Pfizer, which had regularly increased prices over the years, temporarily put off raising prices last year amid pressure from President Trump, but resumed increases on about 10% of its portfolio this year. Chief Executive Albert Bourla, who began leading the company in January, said on its fourth-quarter earnings call that Pfizer’s growth won’t be driven by price.

Bristol-Myers Squibb has been heavily criticized for how it prices its drugs. It will acquire costly multiple myeloma drug Revlimid, should it close its January agreement to acquire rival Celgene Corp. for $74 billion. Revlimid is Celgene’s top-selling drug, and has regularly gone up in price. In 2007, a 10-milligram dose cost $247.28. This year, on the day of the planned deal between the two companies, the price went up 3.5% to $719.82.

The hearing comes as the Trump administration pursues its own proposals aimed at drug prices. One, opposed by the industry, would tie the price of some Medicare drugs to prices in foreign countries where drugs are cheaper. However, the drug industry has supported the administration’s proposal limiting the rebates that drug companies pay to middlemen in federal pharmacy programs. The move doesn’t directly limit drug manufacturers’ pricing power, although the administration hopes list prices will fall and savings will be steered to consumers.

The drug industry has been proactive the past few years amid criticism of prices. Some including Allergan PLC have pledged to take just one price increase each year, and by less than 10%, while others have made similar proclamations. Companies increasingly are touting how their net prices are staying the same or falling. Last year, Merck cut the cost for some of its medicines and promised to limit its net price increases. Nevertheless, the drug industry continues to raise list prices on many of its medicines.

Senators may also ask about the growing cost of insulin. Sanofi’s chief executive, Olivier Brandicourt, could be questioned on the rising cost of insulin, a treatment for diabetic patients. The drugmaker sells the world’s top-selling insulin, Lantus.

While the hearings might not lead to substantive legislation, they will allow the senators to showcase themselves, Mr. Loss said. “Get your popcorn,” he said.

Sen. Grassley hasn’t always sided with the pharmaceutical industry. He has long supported re-importing drugs from other countries, such as Canada, which the industry opposes. He also helped write legislation that requires disclosure of gifts from drugmakers to doctors and hospitals.

Last year, Sen. Grassley introduced bipartisan legislation mandating that television commercials for drugs include list prices. The measure didn’t pass the House, but the industry’s lobbying group said companies would voluntarily include price-related information in television ads by directing consumers to websites where they can find information on list prices and costs. This month J&J included its list price in a television ad for blood thinner Xarelto.

As an update to the story below – CVS & Wal-Mart did reach an agreement late last month to keep Wal-Mart in the CVS Network.

January 15, 2019

CVS Informed us today that Walmart has opted to leave the CVS Caremark pharmacy benefit management commercial pharmacy networks. CVS Caremark has requested that Walmart continue to fill prescriptions as an in-network participating pharmacy through April 30, 2019. This transition does not affect Walmart’s participation in the CVS Caremark Medicare Part D pharmacy network. In addition, Walmart’s Sam’s Club division remains in the CVS Caremark pharmacy networks.

Statement from CVS: At a time when everyone is working hard to find ways to reduce health care costs, Walmart requested rates that would ultimately result in higher costs for our clients and members. While we have enjoyed a long relationship with Walmart as a low-cost provider in our broad national networks, based on our commitment to helping our clients and consumers manage rising pharmacy costs, we simply could not agree to their recent demands for an increase in reimbursement.

Our focus now is an orderly transition for any affected plan members and ensuring we place patient care as our highest priority. With continuity-of-care in mind, we have requested that Walmart continue to fill prescriptions as an in-network participating pharmacy through April 30, 2019, and are awaiting a response on the transition period.

As we begin to prepare members for a transition, we are hopeful that Walmart will agree to work amicably with us in the best interest of patients. Our priority is to ensure that patients continue to have access to their medications during this transition period. We also remain open to continuing timely, good-faith negotiations with Walmart in the hopes of reaching an agreement to provide quality pharmacy care at a reasonable cost.

Walmart will remain in CVS Caremark Medicare Part D networks

Remember – CVS Health purchased Aetna (the third largest Insurer in the US) for $69 billion.

Best Regards-


Senior Vicec President Health & Welfare Consulting

Trion Group, a Marsh & McLennan Agency LLC




Upcoming Events:

Marybeth will attend the following conferences in 2019!!

North American HR Executive Summit – NEW  February 11-12


San Diego Mid-Sized Retirement & Healthcare Plan Management (MB will be the opening Keynote Speaker)   March 24-27


CFO Connect Spring   April 14-16


Boston Mid-Sized Retirement & Healthcare Plan Management    May 5-8


Chicago Mid-Sized Retirement & Healthcare Plan Management   (MB will be the opening Keynote Speaker)    June 4-7


Nashville Mid-Sized Retirement & Healthcare Plan Management    September 15-18


January 9, 2019

Happy New Year!   I Hope everyone had a wonderful Holiday!

Happy my son Louis got to come home for Christmas!
Holiday with the family!




Texas Federal Court Rules ACA Unconstitutional…But Please Sit Tight

January 9, 2019

Given the heavy media attention, you are probably aware that a Texas federal district court issued a decision on December 14, 2018, declaring the entire Affordable Care Act (ACA) unconstitutional.  The final outcome will take a while, and the ACA remains in effect as this case moves through the appeals process.  Employers (and their group health plans) should continue to comply with the ACA in the meantime.

Do not halt or delay your 2018 Form 1094/1095 reporting.

Texas v. Azar

In its 2012 National Federation of Independent Businesses (NFIB) v. Sebelius decision that preserved most of the ACA as originally written,[1] the U.S. Supreme Court held that Congress had the authority to implement the individual mandate and its penalty under the taxing power given to it by the U.S. Constitution.  The individual mandate penalty was reduced to zero effective January 1, 2019, by the Tax Cut and Jobs Act of 2017 triggering the Texas v. Azar lawsuit over the continuing constitutionality of the ACA.  This case was ultimately joined by thirty-six states and the District of Columbia giving it a distinctive red versus blue feel.

In his decision, Judge O’Connor determined that the elimination of the individual mandate penalty meant the individual mandate itself could no longer be viewed as a valid exercise of Congress’ taxing power.  Judge O’Connor also determined that the individual mandate was so essential to and inseparable from the ACA that this renders the entire ACA unconstitutional.

Predicting the Future

Judge O’Connor’s ruling did not include an injunction, meaning the ACA is still in effect pending the appeals process.  This fact was verbally repeated by the Trump administration.  It is probably foolish to attempt to predict the future of Texas v. Azar, but if we had to:

  1. The 5th Circuit – This is a coin flip, but the U.S. Court of Appeals for the 5th Circuit overrules the district court opinion. While the court agrees that the individual mandate is unconstitutional, the 5th Circuit is unable to conclude that the individual mandate cannot be severed from the rest of the ACA.  Whatever the outcome, the side that comes up short appeals to the U.S. Supreme Court.
  2. Congress – If the 5th Circuit finds the ACA unconstitutional, lawmakers work in earnest to draft legislation preserving ACA protections that are popular with voters and to avoid massive disruption in the insurance industry. One of these bills will have enough bipartisan support to be enacted by Congress and signed into law by the President should the Supreme Court declare the ACA unconstitutional.
  3. The Supreme Court – The U.S. Supreme Court agrees to hear the case and preserves the ACA again by holding that the individual mandate is severable from the remainder of the ACA and/or for other reasons. Remember, the appointments of Justices Gorsuch and Kavanaugh notwithstanding, the five justices who ruled in favor of the ACA in NFIB v. Sebelius in that 5-4 opinion are still present. 

We’ll keep you updated as this progresses.   If you have any questions regarding this brief, feel free to contact me at MBGray@Trion.com  

484-755-9444.   Feel free to visit my website for regular updates.


October 17, 2018

Anthem to pay $16M in record data breach settlement

Anthem, the nations second largest insurer,  has agreed to pay the federal government $16 million in a settlement over its 2015 data breach that hit nearly 79 million people, HHS said Monday.

The agreement is by far the largest settlement reached by HHS’ Office for Civil Rights for a Health Insurance Portability and Accountability Act (HIPAA) breach. Stolen information included the names, birth dates, Social Security numbers, home addresses and other personal information in this 2015 cyberattack.

As part of the settlement, Anthem agreed to a corrective action plan where it will conduct a risk analysis and fix any deficiencies. HHS will oversee Anthem’s work.

Today, we are seeing healthcare companies becoming attractive targets for hacks, and they’re expected to have adequate cybersecurity defenses.

Also in the news today:

Four people indicted for $931 million telemedicine fraud scheme

Federal officials indicted four people in Tennessee for an alleged scheme that involved using telemedicine to bilk insurers out of about $174 million.  The defendants allegedly submitted at least $931 million of fraudulent claims after tricking tens of thousands of patients and more than 100 doctors.

The telemedicine company, HealthRight, where the 4 people indicted worked, were found to be producing fraudulent insurance coverage information and prescriptions from patients, according to court documents. After getting doctors to approve the prescriptions, which were invalid, the defendants would bill payers, including Blue Cross and Blue Shield of Tennessee,  for greatly marked-up prescriptions, reaping the rewards of overpayment. They did this repeatedly over the course of three years, with the scheme ending in April 2018, the Justice Department alleged. HealthRight and its CEO, Scott Roix, pleaded guilty to felony conspiracy.

October 12. 2018

Good Morning, several interesting items in the news this week! The Insurance carrier marketplace is in flux with mergers and acquisition never seen before. Many believe they are attempting to meet the new demands for a change in the way we receive healthcare in the U.S. and garner market share.  These traditional carriers may be concerned with how they will compete with the likes of Amazon, who is attempting to disrupt and reshape how healthcare is delivered.  These established insurers have recognized they need to change their business model to adapt to customer demands for quicker, more nimble healthcare delivery options that are less expensive while being more convenient.  Below are several updates to the consolidation taking place.

  1. CVS Health Acquisition of Aetna Approved to move forward.  This Landmark merger in healthcare inches towards the finish line with the DOJ approval this week. The $69 Billion acquisition will drastically reshape the landscape in the insurance marketplace for employers and their members. The transaction is on track to close in early part of Q4 2018. This is the largest health insurance deal in history.

WOONSOCKET, R.I., Oct. 10, 2018 /PRNewswire/ — CVS Health (NYSE: CVS) today announced that it has entered into an agreement with the U.S. Department of Justice (DOJ) that allows it to proceed with its proposed acquisition of Aetna (NYSE: AET). DOJ clearance is a key milestone toward finalizing the transaction, which is also subject to state regulatory approvals, many of which have been granted. CVS Health’s acquisition of Aetna remains on track to close in the early part of Q4 2018.

 “DOJ clearance is an important step toward bringing together the strengths and capabilities of our two companies to improve the consumer health care experience,” said CVS Health President and Chief Executive Officer Larry J. Merlo. “We are pleased to have reached an agreement with the DOJ that maintains the strategic benefits and value creation potential of our combination with Aetna. We are now working to complete the remaining state reviews.”

 Following the close of the transaction, Aetna will operate as a standalone business within the CVS Health enterprise and will be led by members of its current management team

2. On September 17, 2018 Cigna and Express Scripts also received the nod from the DOJ to merge.   Express Scripts, the largest Pharmacy Benefits Manager in the country, will be acquired by Cigna in a $52 Billion deal. Aligning the pharmacy and medical programs in an attempt to integrate data and lower costs.  The results remain to be seen.

  1. United Healthcare, the largest insurer in the U.S. has long established an integrated approach to medical and pharmacy and owns the third largest PBM – OptumRX.  They have recently begun to purchase physician practices, such as DaVita Medical Group.

Trump Signs New Laws Aimed at Drug Costs and Battles Democrats on Medicare!

NYTimes Reports:

President Trump signed bipartisan legislation on Wednesday that would free pharmacists to tell consumers when they could actually save money by paying the full cash price for prescription drugs rather than using health insurance with large co-payments, deductibles and other out-of-pocket costs.

The legislation on gag clauses has been praised by lawmakers in both parties, but the signing was nearly eclipsed on Wednesday by a separate health care furor: Mr. Trump asserted in an essay in USA Today that Democrats supporting “Medicare for All” would wreck the program for older Americans, infuriating Democrats who said he was lying to millions of Americans.

Also in the news, expensive new treatments for oncology with precision medicine using genetic analysis. The world of genetics is quickly evolving, taking the industry by storm, and will undoubtedly have a tremendous impact on the care received by employees and impacting employers’ health care costs.  From pharmacogenomics to genomic sequencing to tumor profiling – genetic capabilities are seemingly boundless and thus overwhelming for employers looking for ways to interpret and leverage this new opportunity. We are entering a new era of targeted therapy which is both less toxic and providing better outcomes… but this progress has not been cheap!  The cost of treatment and cure keeps increasing, and many plan sponsors are worried about having an affordable benefit program that allows them to protect members’ health as well as the company’s bottom line.

Where should employers be focusing their energies when it comes to genetics in health care?  Treatment for cancer has become one of the top drivers of healthcare costs for most employers. Advancements in cancer treatment is something that employers should understand so they can develop programs to improve quality of care and outcomes for their members.   Genetic analysis can help medical providers understand and better diagnose a person’s risk for disease, correct dosage of medication and the proper medication with a better understanding of adverse effects.  For the member, genetic insights help people learn how their genes impact their health— from their risk for common hereditary cancers and heart conditions to the effectiveness of their medications. The opportunities come with a cost but have enormous potential to more accurately treat illness for better outcomes, higher quality of treatment and potentially lower healthcare expenditures in the long run.

We have seen a shift in strategy with the 2019 and 2020 plan designs.  Employers are increasingly focused on strategies to manage health benefit cost growth without shifting cost to employees. That’s no small challenge, but surveys like the EBRI study suggests, in a period of low unemployment and tough competition for talent, your health benefit program may be the X-factor that helps you get and keep the workers you need.  We should all be asking: Can we make this system more efficient and more effective for those paying for the majority of the spending today? An employer health-driven economy means employers collectively bear the burden of healthcare in our country.   We’re paying the lion’s share for the care of most Americans in the U.S.    Employers need to expect more from the current healthcare system from end to end.

Opioids: Very hot topic and a key strategy consideration going into the 2019-2020 renewal planning.   A successful strategy includes your Healthcare Plan, PBM and Disability Carrier in partnership to solve for this significant problem.   An estimated 2.9 million Americans use prescription opioids non-medically, which is about 1.4% of adults over 25. Opioid misuse and abuse affects working people of all ages and their dependents. Abusers have higher health care costs and a greater number of disability claims and miss more work days.  Why its an issue employers are focused on?  Misuse and abuse of opioids could impact employee productivity, workplace costs, absenteeism and disability costs, workers compensation claims, overall medical expenses, and the labor participation rate. Additionally, a recent research survey found that opioid abuse costs employers approximately $10 billion from absenteeism and presenteeism alone!

Here are some things employers should be thinking about when building a strategic response in their benefits programs:

Ø Annual utilization review with the Medical Carriers and PBM’s: Common opioids to look for in your claims:



Fentanyl (also available as a patch)



Ø PBM Clinical Programs in place to set standards to ensure

  • Quantity limits to a 3-5 day prescription
  • The Lowest effective dose in initial prescription
  • Non- opioid pain medication where possible


Join us December 5, 2018 for our next Power Lunch!

Our topic: Gearing Up for 2019:  Benefits Strategies to Recruit and Retain Talent in an almost Zero Unemployment World

We will discuss:

  1. What does our workforce now look like?
  2. What do “Best Places to Work” employer benefits contain?
  3. Check-List of benefits to consider adding in 2019 & 2020

 To Register : www.MBGrayHealthcare.com  “Events Tab”

Best Regards!

June 21, 2018

The DOL Releases Final Rule Expanding
Association Health Plans

For a full detailed overview – click on the “News Alerts” Tab

March 21, 2018

Good Morning –Here is an update on the  Industry Disruption:  Mergers & Acquisitions happening in our Industry!

It has been very busy in our industry and quite frankly hard to keep up with who is buying who!

To start, here is how the Commercial Insurers in the US Rank:

  1. United Healthcare (Market Value $112.7 B)
  2. Anthem (Market Value  $41B)
  3. Aetna (Market Value  $38 B)
  4. Cigna   (Market Value $33.8 B)
  5. Humana (Market Value  $27.2 B)

They fall off significantly, revenue wise, from there….

Early in 2017, Cigna was being purchased by Anthem…. and Aetna was buying Humana.  Both have been thwarted by federal regulators.  Now, in the past 6 months, major acquisition news:

  1. Anthem (the second largest insurance company in the US) announced it was dissolving its relationship with ESI in 2020 as its Pharmacy Benefits Manger (PBM) partner and starting its own PBM called IngenioRX.  Anthem is moving towards a business model with an integration of Medical and Pharmacy like that of UHC with    They hired their first female CEO, Gail Boudreaux, who is a former United Healthcare President.
  1. CVS Health announces its purchase of Aetna (the third largest Insurer in the US). It had reached an agreement to acquire Aetna for $69 billon. The companies expect to close the deal in the second half of 2018 pending a review by US antitrust agencies. On March 13, shareholders of both companies voted to support the acquisition.
  1. As a result of Aetna preparing for the CVS Health acquisition, it sold its disability block of business to The Hartford.
  1. United Healthcare purchased DaVia Physician Network. This was an interesting purchase as it will add hundreds of medical clinics to United’s growing business of not just paying for benefits but providing medical care directly.  Already the biggest U.S. health insurer, the company has been expanding its front-line care business to take more control over how its insurance dollars are spent.
  1. Amazon, Berkshire Hathaway & JP Morgan Chase form a Healthcare company for their own employees. What this model is remains to be seen in the coming months.
  1. Amazon Launches Its Own Line of OTC Drugs. This Online Retailer Could Squeeze Pharmacy Giants.
  1. Teladoc to Acquire Best Doctors to Provide a Comprehensive Virtual Healthcare.
  1. Unum enters the stop loss marketplace.
  1. Walgreens is in talks to buy the rest of giant distributor AmerisourceBergen Corp. that it doesn’t already own, according to reports.  (It already owned about 26% of the pharmaceutical manufacturer).

Wait – I am not quite finished yet!!!

  1. Last week, Cigna is back and said it would buy pharmacy benefits manager Express Scripts (The largest PBM in the US) for about $54 billion. Now there are no “dance partners” left in the freestanding PBM Marketplace.

You definitely need a scorecard to keep track!  The last one, Cigna purchasing Express Scripts will take the largest remaining independent pharmacy benefits manager off the street.  One can begin to see a clear trend in the insurance industry – insurance companies are trying to integrate the delivery of care and pharmacy into their own operations.   With CVS now enabled to expand their onsite clinics and be a “front line caregiver” and United Healthcare doing the same with the purchase of DaVita with their doctors, practices, and surgery centers… it is clear they are trying to control all of the pieces.

In my opinion, less competition in the marketplace is never good for purchasers or consumers.  There are upsides to having the pharmacy and medical more integrated for quality of care and management of illnesses.  We have seen in the last 10 or so years,  carving out pharmacy and placing it with a standalone PBM has delivered higher focus and management and lower cost to employers.  We will have to wait and see if some of the efficiency will yield greater savings for us or if less competition will drive costs.

The new head of HHS, Alex Azar has stated this week he is demanding more transparency from insurers to help consumers.   The marketplace has not responded to this directive yet.   Controlling soaring drug prices is also at the top of his agenda.  As a former executive from big pharma – Eli Lilly, we have yet to hear his plan to achieve this lofty goal.

The public exchanges in the US enrolled 11.8 million Americans, a 3% decrease from 2017.  Most expected a lower enrollment given the cuts to the advertising budget and the shorter enrollment period.

New Trend In 2018, there is a growing number of large employers with an appetite for direct employer partnerships with providers.  This would eliminate the “middle man” traditional insurance co.  This will expand the current common practice of “centers of excellence” deployed by large employers.   Whole Foods rolled out a new partnership with a 19 hospital system to give employees direct access to the providers without going through a traditional insurer.  Currently about 3% of large employers contract directly with ACO’s or providers but there are more employers looking at what Boeing, Walmart and Lowes are designing in this new model.  More to come on this topic.

Big News at the end of January with 4 Not-for-profit health systems announcing they were taking on Big Pharma by creating their own generic-drug manufacturing company in an attempt to alleviate shortages in basic antibiotics and IV Products in short supply in the hospitals.  The US generic drug manufactures saw a dip in their stock prices with this news.  Most experts think it will take over a year to get approval for hospitals to move into this space with the proper approvals from the FDA.  We will be watching this to monitor their progress.

A few compliance updates:

March 8, 2018 – The IRS announced reductions to the 2018 HSA and Adoption Credit Tax Limits.  See my website under “News Alerts” for the full brief.

March 5, 2018 – Agencies proposed regulations on Short-Term Limited Duration Insurance.  This will not generally affect employer coverage but something to be aware of.   I have posted a full brief of both on my webpage under “News Alerts”.

Also on my website, under the “events” tab, you will find a full list of the free webinars taking place for the rest of 2018.  The next one will be held March 22 at 1pm EST.  The topic is FMLA and employee benefits programs with a discussion on how to administer benefits while employees are on leave.

I hope to see some of you in San Francisco next week March 25-28!

Best Regards-


January 24, 2018

ACA Cadillac Tax Delayed Another Two Years !

Great News!!   On January 22, 2018, Congress passed a short-term funding resolution to end the federal government shutdown that began last Friday at midnight.  While ending the shutdown is the main part of the legislation, Congress also pass relief for employers from certain Affordable Care Act (ACA) taxes, (at least temporarily) with an additional two-year delay for implementation of the high-value health plan excise tax (Cadillac Tax)!   Now set for 2022.

As you know, the Cadillac tax imposes a 40% excise tax on the aggregate cost of applicable employer-sponsored coverage in excess of certain statutory limits, which is assessed on the plan’s insurance carrier or self-funded plan sponsor.  Originally set to begin this year, the 2018 limits were to be $10,200 per year for self only coverage and $27,500 per year for coverage other than self-only, with adjustments allowed for pre-65 retirees, high-risk professions, and significant age and gender factors.  The tax is now set for 2022 in the newly passed legislation, which is great news for employers!

Opponents of the tax fear it will lead to shifting of health care costs to employees through increased deductibles, coinsurance, and copayments in an effort by employers to keep plan costs down and avoid the tax. Opponents also argue that, because annual adjustments to the thresholds after 2018 are tied to general inflation rather than annual change in health care costs, a significant number of employer plans could be affected by the tax by the time it is implemented.

Many hoped the initial two-year delay passed in 2015 was an indication that a full repeal might follow, but to-date, permanent relief from the Cadillac tax has not come. Although the figure is a topic of debate, the Congressional Budget Office previously projected the tax would generate $87 billion over a 10-year period. So, while there is considerable support for repeal of the Cadillac tax among lawmakers, employers ad other stakeholders, potential loss of the Cadillac Tax’s projected revenue on a permanent basis is an obstacle for some legislators.

At the very least, today’s action is recognition of the Cadillac tax’s unpopularity and it suggests Congress is likely to continue to at least contemplate workable plans for eliminating it. The move also provides some more breathing room for the many employers that have been evaluating strategies to curb the impact of the Cadillac tax. The additional time may allow employers to identify effective cost-management strategies that would enable them to avoid aggressive plan design modifications if and when the tax becomes a reality. Despite significant chatter regarding the possibility of a full repeal of the Cadillac tax, until any new developments occur, employers should plan for its implementation in 2022.


As always, I am here to answer any questions you might have as you prepare to comply with upcoming ACA requirements. If you are not currently a Trion client and would like assistance navigating the changes required by health care reform, please contact me by emailing    MBGray@Trion.com

January 19, 2018

This morning, it was announced that Liberty Life Assurance Company of Boston has signed an agreement to be purchased by Lincoln Financial Group. Lincoln will retain Liberty Mutual’s Group Benefits business and immediately reinsure the Individual Life and Annuity business to Protective Life Insurance Company. It is expected that this transaction will be completed in the second quarter of 2018, pending regulatory approvals and other customary closing conditions.

We wait as Congress remains deeply divided on how to avoid a government shutdown prior to this weekend.  Two big items being used as leverage in the negotiations are re-funding the CHIP program for 9 million American Children who access healthcare services through this essential program and DACA with 700,000 people brought into the US illegally as children waiting to see if their protected status is removed or residency made permanent.   Hundreds of thousand federal workers and military personnel watch and wait to see if Congress can reach consensus in Washington DC.

The City of Philadelphia announced this week it was joining a growing number of other US Cities and States suing opioid makers over the epidemic they are facing in their city.   It is clear there is an unprecedented public health crisis that needs to be solved.

US Stock market soars this week with the DOW topping 26,000 for the first time.  It will be interesting to see if worries over a Government Shutdown will stifle this climb.   Millions of women this weekend will march on Washington DC in protest.   

January 2, 2018!    HAPPY NEW YEAR!

I hope everyone had a safe and happy holiday season and HAPPY NEW YEAR!  

Wishing everyone a prosperous,  happy and exciting 2018!   We have much to focus on this year in healthcare.  Catching up on the news over the past few weeks was exciting!   Here are some of the items that caught my attention.

Americans were stressed in 2017

According to the American Psychological Association,   Healthcare ranked very high on the list of concerns within the survey. 43% of Americans were concerned about the future of Healthcare, followed by 35% concerned about the economy and 30% had concerns with trust in our government, hate crimes and the potential for terrorist attacks.

Are the State Exchanges in Trouble in Future Years?

With the recent passage in Congress of the Tax Reform Legislation, the elimination of the individual mandate for Americans to have health insurance means healthier people will have less need to purchase insurance and will be less likely to buy it.  The remaining pool of people, who will likely purchase insurance on the exchanges, will be the higher cost individuals who will need healthcare coverage.  Insurers that still participate in the exchanges are going to increase premiums to cover the higher risk.

Is Obamacare dead?

NOPE!  A Strong Showing as Nearly 9 Million Sign Up  for 2018 in a remarkably strong showing  of consumer demand for health insurance in the individual market.  The government numbers proved predictions of its collapse wrong yet again.

Why ¾ is the key statistic

The Federal Government still pays on average ¾ of the premium for people purchasing coverage through the state exchanges.   Further,  ¾ of the participants purchasing health insurance on the exchanges qualify for the following subsidies:

*Individuals earning less than $48,240 qualify and

*Families earning less than $98,400 annually.

What does this mean? 

As premiums on the state exchanges increase, so will the cost to the government in the form of subsidies.   Additionally, 31 states expanded Medicaid since the inception of ACA.  Now over 75 million Americans are on Medicaid covering substantially more than Medicare for older Americans.

What’s Next?

The current administration has vowed to propose new rules to allow people to buy less expensive and less comprehensive coverage for healthcare through expansion of association plans and other private venues.

What does this all mean for Employers?

There is just not enough space on this page for me to outline all the ways this will affect us in our world of employer benefits!  Suffice to say, with these changes, it should effect and change the reporting requirements, minimum coverage limits among many other items we have worked hard to manage and be compliant with over the past several years.  One thing that has not changed?   Our need to continue to focus on managing costs and trend to continue to offer benefits to our employees and their families.   What the tax overhaul did not change?   The final bill did not delay or repeal the ACA’s excise (“Cadillac”) tax on employer-sponsored coverage still set for 1/1/2020.

Industry Consolidation:

Join me for the next “20 minute Power Lunch” session to be held on January 10th at 12 noon EST.  Registration will be open tomorrow through my “events tab” on this webpage:

We will cover in our discussion:

* Tax Reform removes ACA Individual Mandate

* CVS to purchase Aetna

* Anthem to start up their own PBM IngenioRX

* United Healthcare new marketplace business strategy

December 6, 2017

In the news this week, CVS Health announced it had reached an agreement to acquire Aetna for $69 billon. The companies expect to close the deal in the second half of 2018 pending a review by US antitrust agencies. This will be an interesting business model,  combining pharmacy management and health plan services with CVS Health’s extensive retail network of 9,700 + stores nationwide and over 1000 retail clinics.  This mix could bring greater retail and customer service focus to health care, more integration of pharmacy and medical benefits, and increased emphasis on primary and preventive care at lower costs for plans and patients.  Of course my thoughts go to price competitiveness.  Will this model inhibit clients from carving out RX to a more competitive PBM if they are mid-size employer groups?   We can only wait and see….   Your CEO’s  may ask how this will effect your plan if you are current client of either company.  I would point out you may not see any changes until 2019.   With this merger of services, we could see better options with the integration of the CVS Minute Clinic availability to members with improved access to care at a lower price.   We may also see a potential integration on the pharmaceuticals that are running through your medical program due to being delivered in the doctors office (Oncology is a big driver of this).    About 50% of specialty pharmaceuticals are currently running through your medical plans and missing the key clinical programs we have put in place on the pharmacy side to help manage the cost and utilization.  This integrated model may improve our ability to tackle that problem and improve management.    There are certainly opportunities here that have yet to be explored with this new model.

Join my next Power Lunch on January 10, 2018 for a robust discussion on the marketplace changes occurring!   Registration on my “Events” tab will be posted shorty!

November 24, 2017


Hope everyone enjoyed their Thanksgiving Holiday.  It was nice to have my family together and relax for a few days.   Lots to be thankful for.   My son Nick is a Junior at Penn State majoring in Health Policy and Administration (where I am a graduate).   I asked why he choose that major and he said simply, “I want to have a job I love to do as much as you love your job mom.”     Very nice to hear.   I do love my job, my clients and the great people I have the privilege to work with every day.    Thank you!

As usual, there is lots of news to talk about in the past two weeks.   Here are some of the key news stories:

Anthem becomes the second-largest company with a women as CEO

Anthem, the nation’s second largest insurance company in the US named Gail Boudreaux as CEO last Monday.  The only other US Company with more revenue and a women CEO is General Motors with Mary Barra at the helm since 2014.  IBM is led by Virginia Rometty and PepsiCo is led by Indra Nooyi.  These are the only US companies among the Fortune 50 with women in charge.

Anthem has been in the news in the past two weeks due to interest in their business strategy.  Noteworthy – Gail Boudreaux is a former United Health President.  Industry speculation is Anthem is moving towards a business model more like United Healthcare with an integration of Medical and Pharmacy model (like that of UHC with RX arm OptumRX).  Anthem recently announced plan to launch its own PBM, IngenioRX.   They have announced the move away from using their current PBM partner Express Scripts (ESI) beginning  in 2020.  In a similar move,  CVS CareMark announced an offer to purchase Aetna Inc. in an effort to achieve the same business model goal.

Nov 1st CMS announced it was moving forward with a $1.6 Billion cut to the federal drug discount program known as 340B.    

These cuts will most effect not-for-profit hospitals and urban hospitals with a high mix of uninsured patients and Medicaid recipients.  Moreover, it is unclear how the CMS is making these decisions and what is next leaving hospitals more confused about the future of programs like these.

Congress missed the September 30th deadline to extend funding for the Children’s Health Insurance Program (CHIP) leaving almost 9 million children and 370,000 pregnant women hanging in the balance of having no access to health care.  Since this in an editorial section of my website, I will share this is deeply troubling to me as a Healthcare Consultant,  An American and Mother.  Most pediatric care is preventive care and without immunizations this leaves an at-risk population of children in the US in an even greater vulnerable position.  The last minute funding of this program for  short periods of time – leaves providers and the CHIP program managers in a difficult position with the uncertainty of funding.   In a country as rich as ours, this is unconscionable.

CVS CareMark’s announcement of an offer to buy Aetna has left the industry experts debating whether or not the FTC will allow this large acquisition to occur.  We remember early in 2017, the U.S. Justice Department stopped Anthem’s purchase of Cigna, a deal that would have created the largest U.S. health insurer by membership, and Aetna’s planned $33 billion acquisition of Humana.   This leaves most with the speculation that even though Aetna sold their life and disability business (seemingly) in preparation of this acquisition, it still remains unclear if this will be blocked.

Marybeth Gray

November 8, 2017

IRS Indicates 2015 Employer Mandate Penalty Letters Are Imminent

Read the details under the “News Alerts” tab of my webpage.   I have also provided a link to the Nov. 8th Power Lunch Webinar “Value-Based Plan Designs” under the “Events” Tab.

November 1, 2017

So much in the news in the past week it is difficult to keep up!   Here are some headlines to be aware of:

  1.  Aetna made 2 BIG news splashes in the last couple of days with the announcement  that they had entered into an agreement to sell its U.S. Group Life and Disability Insurance Business to The Hartford. The transaction is expected to close in early November 2017, and is subject to state regulatory approvals.  With the addition of the Aetna Group Insurance business, The Hartford will be the second largest group life and disability insurer in the U.S.             And then this!….
  2. U.S. pharmacy benefits manager – CVS Health Corp has made an offer to acquire No. 3 U.S. health insurer Aetna Inc for over $66 billion!   The deal would merge one of the nation’s largest pharmacy benefits managers with one of the oldest health insurers, whose far-reaching business ranges from employer healthcare to government plans nationwide.

    3. Last week No. 2 insurer Anthem Inc. announced plans to manage its own pharmacy benefits with the help of CVS, a move that would give it a set-up similar to UnitedHealth Group Inc. and its Optum unit. Insurers want more control over the pharmaceutical component of care as they implement pricing models with doctors and hospitals that are based on health outcomes, not just procedures.


    4. The rate of uninsured is up 1.4% in the last year.  An additional 3.5 million more adults are uninsured than had been in late 2016.  Unless action is taken to stabilize the individual marketplace, this rate is likely to increase.  Employees & retirees who rely on the exchanges could benefit in future years to the extent that funding the cost-sharing reduction payments would stabilize exchange premiums.

So what does all this mean?   There is a large amount of consolidation taking place.  The upside to this is if greater efficiencies are achieved, it could mean cost savings.  The downside to the consolidation may be price control, fewer carrier options and we all know competition leads to better pricing.

October 12, 2017

Trump issues an executive order to relax health insurance rules

President Donald Trump signed an executive order this morning to direct the Departments of Treasury, Labor, and HHS to consider expanding coverage through low-cost, short-term health plans that are exempt from Affordable Care Act insurance market rules.   This would potentially allow Americans to purchase cheaper, skimpier health plans by easing some standing policy restrictions under ACA.    These plans may not have to comply with the minimum essential benefits set forth in the current ACA legislation.

It also included:

Expansion of Association Health Plans–   Allowing employers, particularly small businesses and professional groups, to join together to offer health coverage to their employees. Employers must be in the same line of business.
Short-Term, Limited Duration Health Insurance –   Permitting low-cost, short-term health coverage in the individual market that is exempt from some of the ACA mandates. The aim is to offer options to people between jobs, those with limited choice of coverage options individual market, and those who missed open enrollment but want coverage.  The order apparently would allow individuals to buy these short-term plans lasting up to 364 days.   The Obama administration rules limited the duration of short-term plans to 90 days.
Expands HRA Flexibility –    Expanding the ability for employers to use Health Reimbursement Arrangements (HRAs) to help employees pay for their health care expenses. Currently IRS rules prohibit employers from having freestanding HRAs for employees’ health care expenses unless they also offer health coverage. It is unclear whether the expansion would remove this prohibition.

One concern, potentially a byproduct of these “Skinny Plans” with less coverage is the attractiveness to the younger, healthier population….   leaving the older and higher utilizers in the current plans, further creating adverse selection for the exchanges.  This could result in insurers raising rates for more comprehensive plans or exiting the market entirely.

October 12, 2017

Pharmacy is at the top of the list of concerns for employers in managing cost.  Specialty drugs are driving costs and with 50% of the drugs in development falling into the specialty drug category, there is no question it needs to be the focus.   Additionally, with many specialty medications running through the medical program instead of the pharmacy plan, due to being administered by the physician offices, we need to be watching those as well.    What are employers doing?  Link to the white paper we wrote for EBenNews here:  


Happy October    Munich – Beer Garten


October 10, 2017

Last week we had several major news items of interest:

  1. The Trump Administration announced plans last Friday to reduce the mandate that requires insurance benefits to cover birth control at no cost under the standing ACA preventive care. If an employer registers a religious or moral objection they may now opt out of no-cost birth control for workers within their benefits plans.
  2. Secretary of HHS, Tom Price resigned due to the scandal of his use of private planes for travel on the taxpayer dime. Price was ineffective as the promoter of the Repeal and Replace effort of the ACA (aka Obamacare) legislation.
  3. CVS on Friday announced it would limit opioid prescriptions to 7 days for certain conditions. Limiting the daily dosage of pain pills and strength of the pain medicine. The change will be effective February 1, 2018. Sales of prescription opioids quadrupled from 1999 to 2014.

Friday, (10/6) President Trump stated the effort to “repeal and replace” Obamacare was not dead and would be back on the list for the new year. He stated in a press release he would be open to “cutting a one to two year deal with democrats” if necessary, skirting his own Republican Party efforts.

September 25, 2017      Good morning everyone- We have a lot going on in Healthcare this week…  Repeal and Replace Obamacare is back in the news!  The Senate may vote this week on the Graham-Cassidy Plan put forth by Republicans trying to take another run at dismantling the current system.   Medicaid is on the chopping block (1 in 5 Americans take advantage of Medicaid programs).  Bernie Sanders is picking up steam as well with the “Medicare for all” idea in an effort to sustain the state and federal exchanges with a healthcare option in every county that is in peril.  He has garnered the support of 16 of his fellow Democrats support.  I don’t know about you – but I have the popcorn ready for the debate on CNN tonight between the two:  Lindsey Graham & Bill Cassidy (Republicans) will debate Sen. Bernie Sanders & Amy Klobuchar (Demarcates) in a town hall at 9pm on CNN.

Strategic focus – We talked a lot about the new breakthroughs that will affect our healthcare costs shortly…  I liken this to the entry of specialty pharmaceuticals just a few years ago.   Heart disease and cancer continue to be the leading causes of death and top drivers of medical cost for employers in the US.  With scientific advancements and the plummeting cost of genetic sequencing, genetic information has the potential to drive unprecedented levels of prevention and early detection. But employers are unsure of what the increased use of personalized medicine and genetic testing means for them and how it can benefit employees.   Many employers are investigating how genetics is changing the role of prevention in health care today and how leading companies are turning to genetics as an integral pillar of their overall preventive health strategy.

High Claimants need to be an area of focus in your upcoming plan year strategy!  Here are some statistics to think about (specialty RX is playing a role in this as well)

  • $25,000+ claims are up 13% over 2016
  • $250,000+ claims are up 47% over 2016
  • $1,000,000+ claims are up 124% over 2016

I will be reviewing this topic and the 2018 Survey Data for plan changes by large employers on Wednesday, Oct 11th in our free Power Lunch Webinar series (registration info. on the Events tab)

2 news alerts this week: 

Check out full details on these new legislative alerts (NEWS ALERT tab)

  1. Court Requires EEOC to Substantiate 30% Limit on
    Wellness Program Incentives
  1. Reminder: Medicare Part D Creditable Coverage Notice Deadline is October 14, 2017


2018 Survey Data is in!   What are large employers rolling out to employees for 2018?  Full details and a summary of the National Business Group on Health Survey for both Medical and Pharmacy can be found under the “Survey Data” tab on my webpage.   Additionally, we will be holding a 30 minute webinar on October 11 at 12 noon EST.  You can register for this event under the “Events” tab of my webpage beginning Friday.

8/21/17  Happy Summer!!     Hope everyone is enjoying the warm weather and some time with the family!   Two news stories that got little attention in the last two weeks that surprised me:   1. Aetna posted a second quarter profit of 52%!    2.  The Collapse of one insurance company in PA left the other US Health Insurance companies on the hook for millions in losses.  The PA long-term care insurance co. went belly up, leaving all insurance cos (by law) required to pay the liabilities approaching $4 Billion.  This is one of the largest insurance failures in US history!  CA may be the hardest hit with its fee liability estimated at $400.6 million.    Florida is next with an estimate of $360.4.  This may lead to health insurers passing along premium surcharges to customers (employers and their employees) in higher premiums.  Anthem Inc. the nations second largest insurer estimates it will pay $253.8 million to cover its portion of the bill.

8/19/17    ACA Public Exchanges take a beating:

The Trump Administration has not stated if they will kick in the money to subsidize insurance companies thus lower rates so enrollees in the state exchanges can afford the premiums ($7-10 Billion in subsidies).  This uncertainty of funding has lead to many US insurance company’s that still participate in the exchanges to pull out.  On August 16, 2017 the insurance companies had to commit to offering in the exchanges or alert the pull out.  4 large insurer have told officials they are pulling out of the state exchanges, leaving at least 868,460 participants losing coverage in 2018.   Nationally, premiums are set to go up on average,  approximately 22% in 2018 on the exchanges.   Sadly, some parts of the country will see increases of 40% or more.     As of last Friday, according to the HHS, 2.3 million Americans or 25% enrolled in Obamacare will have no choice for insurance cos on the exchange in their counties.  WHY should we be concerned about the state exchanges?  If the number of uninsured people in the US increases, the care they receive with providers and hospitals will be cost shifted to those who can pay – the people WITH insurance… so the cost for employer sponsored coverage increases.  Additionally, if the uninsured go without simple initial treatment for ailments, the cost for care when catastrophic occurrences hit, is much greater than if the person were able to seek care earlier at a lower price.

9/5/17     Anthem, the largest Blue Cross/ Blue Shield plan in the US announced new outpatient imaging policy for fully insured clients beginning March 2018.      Anthem states they will no longer pay for MRIs and CT delivered on an outpatient basis at hospitals.  They are typically  more expensive services in a hospital setting vs. a free-standing imaging center.  This will significantly impact hospitals negatively as a large degree of profit is generated by these services.  This may lead other insurance companies to follow this lead with similar new cost cutting measures.    For Self Insured Plan sponsors, they are still counting on the CDHPs to push employees to lower costing options.   Transparency tools are assisting in this effort which many employers are rolling into their 2018 plan changes.

3/29/17      Now more than ever – we must continue to build our strategies to control cost on both Medical and Pharmacy! 

Last Friday,  House Speaker Paul Ryan cancelled a vote that would have undone Obamacare.  It would have delayed the ACA’s excise tax until 2026, eliminate the penalty for the employer mandate retroactive to 2016 and make other important ACA changes.  Republicans could not come to consensus and it was unlikely to reach the 216 votes necessary to pass, even with the Republicans having the majority.    Many Republicans stated they could not support the bill and were seeking additional concessions to drive down premiums and address the predicted loss of coverage for millions of Americans under the newly proposed plan.  It was not a “well-thought out”  piece of legislation and would have left younger Americans with no financial means to purchase insurance on the exchanges with lower or no subsidies.  It would have further eroded the already failing plan options on the state exchanges.   Congress will need to enact reform quickly to ensure there are viable coverage options on the existing exchanges over the next 6-12 months.

House speaker Paul Ryan stated in a press conference on Tuesday, that the legislation would be continued and concessions made to bring the bill back to the House floor in the near future for a vote.  For now, they have put aside the ACA reforms to focus on other issues like tax reform. The excise tax will be the focus of much discussion as it is now back on and set to take effect in 2020.   This will reignite employer focus and shift strategies back to the problem of trying to reduce plan costs below the allowable thresholds of the excise tax or employers will face a 40% tax on the amount above the allowable limits for each of their employees.   If left unchanged, this tax will affect the 150 million Americans who rely on employer-sponsored health coverage.

You are all invited to my “20 Minute Power Lunch” webinar series beginning April 5th at 12:00 pm est.   They will be held every first Wednesday of the month to bring you up to date on the healthcare landscape and how it will effect employers; your plans and your strategies!       Invite and registration info coming soon!!




3/1/17    Many of us watched the Presidents address to Congress last night with anticipation…  but the details on how this administration plans to reform the current ACA is still unclear.  He did re-state many of the themes we have outlined below in our news alert briefing yesterday….  Clearly many Americans are concerned they will lose the coverage they currently have under the exchanges.  We will watch closely as they release more details.

2/28/17    Below is our latest alert regarding President Trumps “Repeal and Replace” strategy.  The President has promised to outline more details in his televised address tonight.  (We can only hope it is as good as the Oscars was on Sunday night… Let’s hope he has the correct envelope!)   I will be commenting tomorrow on the strategy his administration is planning to roll out…  Lets hope we get some details on what the plan will include and the changes to current they are planning so we can plan the best strategy for our employer partners!

Best Regards!




February 28, 2017

Early Look at Possible ACA Repeal and Replace Plan

Last Friday, details of a “discussion draft” of a Republican bill to repeal and replace the Affordable Care Act (ACA) were leaked to the public. The bill resembles House Speaker Paul Ryan’s existing A Better Way proposal and also includes elements from other GOP repeal and replace plans proposed previously. Key features of this most recent draft bill are highlighted below.

ACA Provisions Proposed for Repeal

On a positive note for employers, the bill would effectively eliminate the ACA employer mandate by setting penalties to $0 retroactive to 2016. The bill would also repeal the “Cadillac tax” on high value health coverage scheduled to begin in 2020, which is assessable on the plan insurer or employer-plan sponsor if self-insured.

Additional ACA provisions that would be repealed under the draft bill include:

·        Individual mandate (by setting penalties to $0 retroactive to 2016);

·        Income-based individual premium tax credits (i.e., subsidies) for ACA insurance Marketplace coverage (elimination as of 2019);

·        Medicaid expansion (elimination as of 2020); and

·        Additional ACA taxes and fees

o   Health insurer tax (immediate elimination)

o   Additional Medicare tax (immediate elimination)

o   Additional net investment income tax (immediate elimination)

o   Prescription drug tax (immediate elimination)

o   Medical device tax (immediate elimination)

o   Patient-Centered Outcomes Research Institute (PCORI) fee (elimination as of 2020).
Although not specifically addressed in the bill, the ACA’s cumbersome annual employer reporting requirements would be rendered unnecessary by the dismantling of the employer and individual mandates.

Proposed Replacement Measures / Changes

The draft bill is not all good news for employers or, in particular, for employees. The cost of the bill’s proposed replacement provisions would be offset, in part, by a cap on the value of employer-sponsored health coverage that can be excluded from employees’ taxable income as of 2020. The cap is essentially the Cadillac tax reinvented, except the financial burden for the tax would shift from insurers and employer plan sponsors to employees.

Currently, employer contributions to employer-sponsored health coverage are not treated as taxable employee income and employee contributions can be paid on a pre-tax basis. Under the proposal, any cost of coverage in excess of the cap would become taxable income for employees. Employers would also incur standard employer-paid payroll taxes on that additional taxable income. It appears coverage subject to the cap would include medical, prescription drug, and health flexible spending account (FSA) plans, but would not include health savings account (HSA), medical savings account (MSA), stand alone dental or vision, or long term care plans.

The draft bill sets the initial cap at the 90th percentile of premiums for coverage under group health plans in 2019 (determined separately for self-only and other than self-only coverage). The bill assigns the Secretary of Department of Health & Human Services (HHS) responsibility for determining how the 90th percentile would be calculated. An annual adjustment would be applied each year after 2020, but because the adjustment is based on change in Consumer Price Index (CPI) plus 2% rather than medical inflation rate, it’s questionable whether the cap would remain at 90th percentile of cost.

The bill’s proposals for replacing the ACA include swapping the ACA’s income-based premium tax credit subsidy mechanism with age-based tax credits for individual market plans beginning 2019. The tax credits would be limited to individuals who are not eligible for employer coverage or government coverage (e.g., Medicare, Medicaid, etc.) and would be structured as follows:

·        $2,000 per year for individuals under age 30

·        $2,500 per year for individuals age 30-40

·        $3,000 per year for individuals age 40-50

·        $3,500 per year for individuals age 50-60

·        $4,000 per year for individuals age 60 and older

·        $14,000 per year overall aggregate family limit
Additional actions proposed in the draft bill include:

·        Increasing HSA contribution limit to high deductible health plan out-of-pocket cost and allowing spouse catch-up contributions.

·        Allowing insurers to apply premium surcharges if individuals do not maintain continuous coverage.

·        Increasing individual and small group market premium rating age bands from 3-1 to 5-1.

·        Eliminating HHS’ authority to define the scope of “essential health benefits” and allowing states to set their own benefits packages.

·        Implementing Medicaid reform (conversion from unlimited to capped funding to states).

·        While ACA premium tax credits are still available through 2018, modifying qualification requirements, allowing coverage purchases outside ACA Marketplace, and excluding grandfathered plans and plans that cover abortions.
What’s Next

It’s important to keep in mind the bill disclosed last week is an unofficial draft and is likely to undergo changes before it is presented for a vote. There are questions about whether the plan can gain enough support within the party in light of a Congressional Budget Office projection suggesting it would significantly increase the number of uninsured. Some GOP lawmakers believe fewer covered people would mean their plan restored personal liberty by not forcing people who don’t want coverage to buy it. Other party members, however, are disconcerted by constituent backlash at recent town hall meetings. The idea of fewer insured also contradicts President Trump’s earlier pledge of “insurance for everybody”.

The House of Representatives returned this week from a 10-day recess. House Speaker Paul Ryan indicated he wants to present a repeal bill as early as next week and pass it through the expedited budget reconciliation process before the Easter recess in early April. President Trump seemed to echo Ryan’s thoughts on timing during a recent press conference, stating he expects legislation will be introduced in early to mid-March. As always, we will keep you apprised as new developments occur.


Your Trion Strategic Account Managers are here to answer any questions you might have as you prepare to comply with upcoming ACA requirements. If you are not currently a Trion client and would like assistance navigating the changes required by health care reform, please contact me MBGray@Trion.com  or call me at 610-207-8985.

ACA Regulations & Guidance Issued In the Last Two Months

Feb. 2017: HHS Issues Proposed Regulations to Stabilize Individual Market
Jan. 2017: HHS Issues Updated Standards for External Review Process
Jan. 2017: President Issues Executive Order Regard ACA and Agency Memo
Jan. 2017: DOL Issues Final Rule on Various Employee Benefit Plan Penalty Adjustments
Jan. 2017: ACA FAQs 37 – HRA Integration
Jan. 2017: ACA FAQs 36 – Preventive Care
Jan. 2017: HHS Issues Notice of Benefits and Payment Parameters for 2018 Final Rule and Fact Sheet
Jan. 2017: IRS Updates Q&As on Employer Shared Responsibility and Annual Reporting (Section 6056 Reporting and Forms 1094-C/1095-C)
About Trion Group, a Marsh & McLennan Agency, LLC (Trion) HCRAlert!


This content is provided by Trion Group, a Marsh & McLennan Agency, LLC Company (Trion) in collaboration with our compliance partner, Marathas, Barrow and Weatherhead LLP (“MB&W”), a premier employee benefits, executive compensation and employment law firm. The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of Trion, our lawyers, or our clients. This is not legal advice. No client-lawyer relationship between you and our lawyers is or may be created by your use of this information. Rather, the content is intended as a general overview of the subject matter covered.

While Trion and MB&W strive to ensure the accuracy and completeness of these alerts, the publisher, authors, editors, and contributors of the contents are not responsible for any errors or omissions and are not obligated to provide updates on the information presented herein. Trion and MB&W do not control or guarantee the accessibility, accuracy, relevance, timeliness, or completeness of outside information for which links may be provided, nor do we endorse any views expressed or products or services offered by such organization or authors.

The Patient Protection and Affordable Care Act (“PPACA”) is a complex law. Any statements made by Trion concerning tax, accounting, or legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as accounting, tax, or legal advice. Those reading this alert are encouraged to seek direct counsel from your own tax, accounting and legal advisers as to whether your policies and procedures, health plans, and employee contribution requirements are compliant with the PPACA and with any other questions you have regarding this law.

© 2016 Trion Group, a Marsh & McLennan Agency, LLC Company. All Rights Reserved.
© 2016 Marathas Barrow & Weatherhead LLP. All Rights Reserved.


Marybeth Gray

Trion Group, a Marsh & McLennan Agency LLC



Visit my webpage!

www.mbgrayhealthcare.com   Updated to include some other news updates from the past two weeks:

Posted Slides and the recording of the webinar I held in Mid November:    “The Power of Data—Strengthen & Focus Your Strategies”

Link to the recording directly on YouTube:  https://www.youtube.com/watch?v=Yi1aSkikj_E