Top of the Funnel: Macro + Earnings
ELV. Behind the scenes it is said, that NGO representatives have pressured the White House to reverse, amend or augment CMS oversight of the unwinding. Most recently, about 500k children were reinstated due to a glitch in reviewing eligibility of heads of households. Another characteristic of the process has been a delay in initiated redeterminations in large urbanized states like California and New York.
It is this context missing from ELV's earnings commentary that they believe their Medicaid disenrollment has been front loaded with states like Florida's and Texas' early moves. That suggests that large states like California will be slow to disenroll and may not do very much of it. With economic stress looming and employment losses likely, it isn't the craziest idea. However, tax receipts, led by those for sales and use are deteriorating in the states and that may cause some to adjust that attitude a bit.
History tells use that eventually states run their programs to serve eligible people and that day will arrive sooner rather than later.
CONGRESS.
Wyden and Medicare Advantage Regulation. UNH (-), ELV (-), In characteristic style, Sen. Ron Wyden, chairman of the Senate Finance Committee, unveiled his latest effort to crack down on so called “ghost networks” and marketing practices of Medicare Advantage plans.
The Reporting Enhanced & Accurate Lists of Health Providers Act would probably affect lower tier plan sponsors the most, but the cause, the increasingly competitive environment, affects everyone.
The bill would prohibit out of network charges when a beneficiary visits a provider incorrectly listed in the plan’s directory.
Separately the Committee is working on better oversight of broker and marketing practices. CMS has flagged misleading advertisements and is cracking down on third party contractors.
A More Efficient Health System? Sen. Sheldon Whitehouse, Chairman of the Senate Budget Committee has launched an effort to examine ways to boost efficiency of the health care system.
You don’t hear that every day.
Interestingly, the House has taken up a similar charge by focusing on site-neutral payments and price transparency. The witness list is not particularly promising but using the word efficiency in the same sentence as health care is a victory all its own.
Speaker Drama. Still don’t have one. It looks like the “budget hawk but reasonable guy” (Rep. Steve Scalise) and the “budget hawk but pretty extreme guy” (Rep. Jim Jordan are not going to get enough votes.
While we wait for a third alternative to emerge, the year end work like extenders and public health will not get to the floor. However, committees can continue to work so when the logjam breaks things can move quickly.
WHITE HOUSE.
March-in Rights. This week, PFE told the sell side to expect a commercial price of $1,400. They also told us to expect discounting to improve access which probably means the net price is going to be closer to the government price of $530 than not. In our recent deck on PFE we noted how much revenue diversion has accelerated in the last three quarters. We have our theories on that which we will explore on themes call next week.
The price, of course, inspired activists like Public Citizen to argue once again for march-in rights so the government can claim the IP use that to lower the price. Recall, this argument was floated aggressively during the early days of the Public Health Emergency to much wailing and gnashing of teeth.
March-in rights were created not to interfere with the production, sale, and marketing of a drug but for those instances where the commercial viability of certain IP does not meet the standards of most drug manufacturers.
A reason march-in right has not been used is the absence of an answer to who would manufacturer the drugs.
Food Czar. The Food and Drug Administration’s new deputy commissioner for human foods released a statement of priorities this week. Jim Jones is the first person to hold this position.
Jones listed three priorities, Preventing Foodborne Illness; decreasing diet-related chronic disease through improved nutrition; and safeguarding the food supply through safe use of chemicals and dietary supplements.
The goal of decreasing diet-related chronic disease includes efforts to reduce the use of sodium and sugar in the food supply,
OTHER STUFF.
KFF study. KFF released their 2023 Employer Survey of health benefits for 2023. It indicates that employer sponsored insurance costs about 24k this year. Read it here.
Have a great weekend.
Emily Evans
Managing Director – Health Policy
Twitter
LinkedIn
