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RX- 340 B Medicaid MCO Duplicate Discount Confusion and HHS

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

[MM Curator Summary]: MCOs will have to add a field to the drug claims they manage under proposed CMS rules. The new field will make it easier for manufacturers to not get dinged having to offer discounts on drugs twice.

 
 

 
 

Clipped from: https://www.natlawreview.com/article/hhs-takes-steps-to-resolve-340-b-medicaid-mco-duplicate-discount-confusion

On May 26, 2023, the Centers for Medicare and Medicaid Services (CMS) proposed an update to the Medicaid Drug Rebate Program (MDRP) rules, which includes provisions aimed at preventing 340B duplicate discounts on claims billed to Medicaid managed care organizations (MCOs). Duplicate discounts arise when both 340B discounts and Medicaid rebates are provided by a manufacturer for the same drug. Although drug manufacturers that participate in Medicaid are required to provide discounts on 340B drugs under the 340B Drug Pricing Program and are also required to provide state Medicaid programs with rebates under the MDRP on drugs dispensed to Medicaid beneficiaries, including Medicaid MCO enrollees, manufacturers are not required to provide both a 340B discount and a Medicaid rebate under the MDRP for the same drug.

IN DEPTH

Because the relevant statutory provisions do not clearly articulate whether the state Medicaid program, the Medicaid MCO or the 340B-participating provider (covered entity) is responsible for ensuring that duplicate discounts do not occur for Medicaid MCO claims, there currently is no uniform system for identifying Medicaid MCO claims for 340B drugs. In the years since Medicaid MCO drugs became eligible for rebates under the MDRP, the US Department of Health and Human Services (HHS) has generally encouraged the relevant stakeholders and affected parties to work together to develop a solution. To date, that has not occurred. It appears that HHS may finally be stepping in to develop, or at least work towards, a solution.

Under the proposed rule, CMS would modify the standard Medicaid MCO contract requirements to require Medicaid MCOs that provide coverage of covered outpatient drugs to use unique, Medicaid-specific codes and group numbers on beneficiary insurance cards. The use of these identifiers would assist state Medicaid programs, MCOs and 340B covered entities to identify Medicaid MCO claims that might not otherwise be readily apparent as Medicaid MCO claims. Currently it is not uncommon for Medicaid MCOs to use the same group identifiers as claims for patients with private insurance. If implemented as proposed, the various stakeholders could more efficiently develop additional tools to identify such claims as being for 340B drugs or to exclude such claims for being filled using 340B drugs. CMS indicated that this change would allow the MDRP to run more efficiently, and would be helpful to all parties by ensuring that Medicaid rebates and 340B discounts are being provided appropriately. CMS proposed that this new requirement be implemented into Medicaid MCO contracts no later than the next rating period, following the effective date of the final rule adopting this provision.

While the proposed rule would provide an important tool to assist in the development of additional policies to prevent duplicate discounts on Medicaid MCO claims, it would not itself effectuate a full solution. The proposed rule also does not address the ongoing concern among 340B covered entities that state Medicaid programs or Medicaid MCOs could expand 340B “carve out” requirements or reduce reimbursement rates on 340B drugs dispensed to Medicaid MCO enrollees, thereby removing the opportunity for 340B covered entities to obtain the benefit that Congress intended for them to receive through the 340B Program—i.e., generating revenue from 340B drug sales to enable 340B covered entities to provide and expand services in their communities.

CMS solicited comments on the proposed change by July 25, 2023, and specifically requested comments regarding the implementation timeframe and operational issues that may arise from requiring the inclusion of unique Medicaid identifiers on Medicaid MCO beneficiary identification cards.

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TECH- Colorado Medicaid members’ data may have been stolen in cyberattack

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

[MM Curator Summary]: Oopsie.

 
 

 
 

Clipped from: https://www.denverpost.com/2023/06/16/colorado-medicaid-chp-moveit-cyber-attack/

Vendor used compromised MOVEit software

 
 

A laptop displays a message after being infected by a ransomware as part of a worldwide cyberattack on June 27, 2017 in Geldrop.

People covered by Medicaid or Child Health Plan Plus should take steps to protect their identities after their information likely was exposed in a cyberattack, the state agency that runs the programs said Friday.

On Thursday, several U.S. government agencies announced they’d been hit by an attack on a piece of software called MOVEit, which allows organizations to transfer large files in a way that’s similar to consumer products like Dropbox.

A criminal group called Clop has claimed responsibility and demanded extortion payments from companies, but said it didn’t mean to hit government agencies and would delete their data, according to The Washington Post. There’s no way to hold it to that promise, though.

The Colorado Department of Health Care Policy and Financing announced Friday that a vendor it worked with had used MOVEit, and there’s a good chance that Medicaid and Child Health Plan Plus members’ information may have been stolen. The department will notify individuals once it knows who was affected, it said.

The department recommended that anyone who has been covered by either program since 2015 monitor their credit reports and consider asking the credit monitoring agencies to freeze their files. It also said it’s a good idea to change passwords on your online accounts; request an Identity Protection PIN from the Internal Revenue Service so someone else can’t claim your refund; and register for a ssa.gov account if you are eligible for Social Security benefits.

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TECH Personal data for 233,000 Iowa Medicaid members compromised in cyber attack

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

[MM Curator Summary]: 3 (4?) oopsies in Iowa the last year. Latest one is tied to MCNA Dental bennies.

 
 

Clipped from: https://www.thegazette.com/state-government/personal-data-for-233000-iowa-medicaid-members-compromised-in-cyber-attack/

Russian group claims responsibility

DES MOINES — More than a quarter of Iowa Medicaid patients had their personal data compromised in a data breach affecting one of Iowa’s two Dental Wellness Plan managed care organizations.

The personal information of approximately 233,000 Iowa Medicaid members was included in a data breach of MCNA Dental earlier this year, according to the Iowa Department of Health and Human Services.

It is among the largest medical data breaches in Iowa to date, according to federal data, and the largest involving Iowa Medicaid.

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MCNA Dental, one of the largest dental insurers for government-sponsored Medicaid and CHIP programs, suffered a ransomware attack between February and March that led to unauthorized access to personal health data of nearly 9 million people, according to a filing with the Maine Attorney General.

MCNA Dental managed dental coverage under Medicaid for more than 295,000 Iowans at the end of last year, according to a report from Iowa HHS.

Delta Dental is the other managed care organization in Iowa’s dental program. It manages 486,000 Dental Wellness plans.

The Iowa Department of Health and Human Services did not respond to a request for comment by the time of publication.

What information was taken?

The hackers potentially obtained a trove of data from the managed care organization, including full names, addresses, phone numbers, Social Security numbers, driver’s license numbers, health insurance plan information, bills and insurance claims, according to a notice provided to affected patients.

The attack happened between Feb. 26 and March 7 of this year, and MCNA Dental sent notices to patients and states impacted May 26.

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The Russia-linked ransomware organization LockBit took credit for the attack and has claimed on its dark web site to have published 700 GB of patient data from MCNA, according to TechCrunch.

Who is affected?

More than 233,000 Iowans whose Medicaid dental coverage was managed by MCNA were affected. Those impacted received a notification in the mail. Names of parents, guardians or guarantors may also have been taken.

MCNA is offering free credit monitoring and identity protection services to affected individuals.

In an emailed statement, MCNA Dental said it is committed to protecting patients’ information and maintaining the integrity of its systems.

“As soon as we discovered recent unauthorized activity affecting our network, we took steps to mitigate the risk and reported the matter to law enforcement and customers,” the company said. “We continue to fortify our systems, as appropriate, to minimize the risk of a similar incident in the future.”

Other cyber incidents

The security breach is among three reported this year by Iowa Health and Human Services affecting Medicaid members.

On April 10, the department reported more than 20,000 Iowans had their data breached in an attack on an Iowa Medicaid subcontractor, Independent Living Systems.

In May, it reported Amerigroup accidentally disclosed personal health information for 8,333 Iowa Medicaid members to providers in explanation of payment notices.

Also in May, the Clarke County Hospital in Osceola reported it had been the victim of a ransomware attack, which led to the potential exposure of thousands of patients, including their names, Social Security numbers and driver’s license numbers.

Comments: cmccullough@qctimes.com

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FINANCE- CMS Office of the Actuary Releases 2022-2031 National Health Expenditure Projections

MM Curator summary

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

[MM Curator Summary]: Oh lookie- another CMS crystal ball about Medicaid and Medicare future spending that no one will check to see if it came anywhere close in 10 years. But at least we feel like someone’s managing the spend, amirite?

 
 

 
 

Clipped from: https://www.cms.gov/newsroom/press-releases/cms-office-actuary-releases-2022-2031-national-health-expenditure-projections

Average annual growth in national health spending over the next decade projected to be 5.4%

The Centers for Medicare & Medicaid Services’ (CMS) Office of the Actuary released projections of National Health Expenditures (NHE) and health insurance enrollment for the years 2022-2031. The report contains expected impacts from the Inflation Reduction Act (IRA), including that people with Medicare prescription drug coverage (Part D) are projected to experience lower out-of-pocket spending on prescription drugs for 2024 and beyond as several provisions from the law begin to take effect.

CMS projects that over 2022-2031, average annual growth in NHE (5.4%) will outpace average annual growth in gross domestic product (GDP) (4.6%), resulting in an increase in the health spending share of GDP from 18.3% in 2021 to 19.6% in 2031. The insured percentage of the population is projected to have reached a historic high of 92.3% in 2022 (due to high Medicaid enrollment and gains in Marketplace coverage). It is expected to remain at that rate through 2023. Given the expiration of the Medicaid continuous enrollment condition on March 31, 2023 and the resumption of Medicaid redeterminations, Medicaid enrollment is projected to fall over 2023-2025, most notably in 2024, with an expected net loss in enrollment of 8 million beneficiaries. If current law provisions in the Affordable Care Act are allowed to expire at the end of 2025, the insured share of the population is projected to be 91.2%.  In 2031, the insured share of the population is projected to be 90.5%, similar to pre-pandemic levels.

The NHE is published annually and is often referred to as the “official” estimates of U.S. health spending and health insurance enrollment. The historical and projected estimates of NHE measure total annual U.S. spending for the delivery of health care goods and services by type of good or service (hospital, physician, prescription drugs, etc.) and by payer (private health insurance (PHI), Medicare, Medicaid, etc.).

Selected highlights on the IRA as well as NHE spending by major payer include:

Inflation Reduction Act (IRA) on Medicare Part D Enrollees: Several provisions from the IRA are expected to result in out-of-pocket savings for individuals enrolled in Medicare Part D.  Those include: i) limitations on price increases for Part D drugs beginning in 2023, ii) elimination of the cost-sharing requirement in the Part D catastrophic phase (typically 5% beneficiary coinsurance) starting in 2024, iii) implementation of a $2,000 annual cap on out-of-pocket spending on drugs under Part D beginning in 2025, and iv) reduced prices for certain high-cost drugs through negotiation resulting in lower out-of-pocket payments beginning in 2026. These provisions have notable effects on the growth rates for total out-of-pocket spending for prescription drugs, which are projected to decline by 5.9% in 2024, 4.2% in 2025, and 0.2% in 2026.

Medicare: Average annual expenditure growth of 7.5% is projected for Medicare over 2022-2031. In 2022, the combination of fee-for-service beneficiaries utilizing emergent hospital care at lower rates and the reinstatement of payment rate cuts associated with the Medicare Sequester Relief Act of 2022 resulted in slower Medicare spending growth of 4.8% (down from 8.4% in 2021). In 2025, Medicare spending is projected to grow 8.9%, reflecting the effect of the IRA’s cap ($2,000 in 2025) on out-of-pocket spending for Part D enrollees and the associated shift in responsibility for those payments that exceed the cap from the beneficiaries to the program. Projected Medicare spending growth slows to 6.8% in 2030 and 2031, associated with the IRA’s provisions related to drug price negotiations and inflation rebates, as well as slower enrollment growth as the last of the demographic cohort known as the baby boomer generation (those born between 1946-1964) enrolls in 2029.  

Medicaid:  On average, over 2022-2031, Medicaid expenditures are projected to grow by 5.0%. With the end of the continuous enrollment condition in 2023, Medicaid enrollment is projected to decline over 2023-2025, with most of the net loss in enrollment (8 million) occurring in 2024 as states resume annual Medicaid redeterminations. Medicaid enrollment is expected to increase and average less than 1% through 2031, with average expenditure growth of 5.6% over 2025-2031.  

Private Health Insurance: Over 2022-2031, private health insurance spending growth is projected to average 5.4%. Despite faster growth in private health insurance enrollment in 2022 (led by increases in Marketplace enrollment related to the American Rescue Plan Act’s subsidies), private health insurance expenditures are expected to have risen 3.0% (compared to 5.8% in 2021) due to lower utilization growth, especially for hospital services. Faster projected growth in utilization and health care prices in 2023 leads to a 7.7% increase in private health insurance spending. In 2026, private health insurance spending is expected to be impacted by the expiration of enhanced subsidies for Marketplace plans and the associated 10% decline for those enrolled in directly-purchased insurance that year.    

Selected highlights in NHE for the three largest goods and services categories include:

Overview of Hospital Trends: Over 2022-2031, hospital spending growth is expected to average 5.8% annually. In 2022, hospital spending is projected to have increased 0.8%, reflecting declines in PHI and out-of-pocket spending and low growth for Medicare, as growth in the use of hospital services slowed from higher rates in 2021. In 2023, faster growth in hospital utilization rates and accelerating growth in hospital prices (related to economywide inflation and rising labor costs) are expected to lead to faster hospital spending growth of 9.3%.  For 2025-2031, hospital spending trends are expected to normalize (with projected average annual growth of 6.1%) as there is a transition away from pandemic public health emergency funding impacts on spending.

Overview of Physician and Clinical Services Trends: Growth in physician and clinical services spending is projected to average 5.3% over 2022-2031. An expected deceleration in growth in 2022, to 2.4% from 5.6% in 2021, reflects slowing growth in the use of services following the pandemic-driven rebound in use in 2021. For 2025-2031, average spending growth for physician and clinical services is projected to be 5.7%, with an expectation that average Medicare spending growth (8.1%) for these services will exceed that of average Private Health Insurance growth (4.6%) partly as a result of comparatively faster growth in Medicare enrollment.

Overview of Retail Prescription Drugs Trends: Total expenditures for retail prescription drugs are projected to grow at an average annual rate of 4.6% over 2022-2031. Drug spending growth is projected to have slowed from 7.8% in 2021 to 5.1% in 2022, partly due to a decline in private health insurance spending, particularly on newly introduced drugs. Expenditure growth for prescription drugs in 2024 (3.7%) is similar to 2023 (3.6%). It reflects the net impacts from: i) the elimination of 5% coinsurance in the catastrophic phase in Part D, lowering out-of-pocket spending), ii) higher Medicare spending as the program absorbs a portion of out-of-pocket costs formerly paid by beneficiaries, and iii) a decline in Medicaid prescription drug spending due to 8 million in net enrollment losses. For 2025-2031, total spending growth on prescription drugs is projected to average 4.8%, reflecting the net effects of key IRA provisions: i) Part D benefit enhancements (putting upward pressure on Medicare spending growth) and ii) price negotiations/inflation rebates (putting downward pressure on Medicare and out-of-pocket spending growth). 

The Office of the Actuary’s 2022-2031 projections will be published at: http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html

A Health Affairs journal article from CMS’ Office of the Actuary is available here: https://www.healthaffairs.org/. To view the Health Affairs’ study on these projections, you can do so at: https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2023.00403.

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