A quick roundup of the issues driving the healthcare reform conversation.
Week in Review
CHARITY CARE Large hospitals fall short of their community benefit obligations.
Quick takeaway: In order to maintain their tax-exempt status, nonprofit hospitals are required to provide charity care and make investments to improve the health of the communities they service.
Digging deeper: The purpose of this community benefit requirement is to ensure that these nonprofit organizations are providing value that’s at least equal to the tax breaks they enjoy. But, federal law fails to specify how much charity care they should provide, nor what qualifies.
It should come as no surprise, then, that the vast majority of nonprofit hospitals give back less to their communities than they receive in tax breaks.
What it means: Data from earlier this year showed that more than 1,900 nonprofit hospitals (80 percent) had “fair share” deficits, meaning the value of their community contributions fell short of the value of their tax breaks.
PBMs Employers depend on their pharmacy benefit managers (PBMs) to better manage rising prescription drug costs.
Quick takeaway: According to a survey of employers, the vast majority value their PBMs and the range of contract options they provide in helping them control their pharmacy benefit spend for their employees.
Digging deeper: Over the past two years, drug spending has increased to more than a quarter (27 percent) of companies’ overall healthcare spend.
And, as recently covered, employers’ healthcare costs are only projected to go up next year, driven primarily by the cost of expensive breakthrough weight-loss drugs and cell and gene therapies.
That’s why PBMs have become such a critical player in the prescription drug space, as they work to drive affordability on behalf of employers.
What it means: Given the increased legislative and regulatory scrutiny of PBMs, stakeholders are rushing to defend the importance of competition (which PBMs foster), rather than government overreach, in addressing out-of-control prescription drug costs.
HEALTH DISPARITIES Medicaid plays a critical role in addressing racial health disparities.
Quick takeaway: Given the wide and diverse populations served by Medicaid, it’s hard to overstate just how valuable the program has become in the larger effort to promote health equity.
Digging deeper: More than 86 million Americans are now served by the Medicaid program, easily making it the single largest source of health coverage in the country. That total includes millions of children, older Americans, people with disabilities, and 2 million veterans.
Medicaid has also become an essential source of coverage for historically underserved populations, including American Indian and Alaska Native (AIAN), Black, Hispanic, and Native Hawaiian and Other Pacific Islander (NHOPI) communities.
What it means: With this kind of reach into so many diverse communities, Medicaid and the managed care organizations that administer the program help to reduce racial health disparities by increasing access to health coverage – like enhanced pregnancy and postpartum services and expanded mental health services – and by offering innovative initiatives to advance health equity – like providing services focused on health-related social needs.
MEDICARE ADVANTAGE A new report offers a comprehensive look at the state of the Medicare Advantage program.
Quick takeaway: With Medicare open enrollment less than a month away, stakeholders highlight the value of Medicare Advantage (MA).
Digging deeper: The MA program continues to distinguish itself from original Medicare Fee-for-Service (FFS) by virtue of its coordinated care model and focus on supplemental benefits. As a result, nearly 34 million Americans are now enrolled in MA plans – 55 percent of the Medicare-eligible population.
Additional takeaways from the report include:
- Enrollment in MA has doubled over the last decade
- 40 percent of eligible Medicare beneficiaries in rural counties are enrolled in MA plans
- Access to MA plans is near universal (99.7 percent)
- 99 percent of MA plans offer at least one supplemental benefit
What it means: As touched on, it’s this inclusion of supplemental benefits in MA that’s helped set it apart from FFS. These offerings are unique to the program and can help address gaps in FFS.
Supplemental benefits have historically included traditional medical benefits, such as dental, vision, and hearing, but have recently expanded to include services that support health-related social needs, such as access to nutritious food and transportation.
Spotlight
| You can keep up with the latest by following the Health Action Network on X and by liking us on Facebook. And, be sure to check us out on LinkedIn, too. As always, let us know if there’s something you’d like to see covered in a future newsletter. |
The Health Action Network includes everyday Americans—families, workers, businesses, patients, providers, neighbors, and friends. We are working together because we support market-based solutions that offer better healthcare choices and help build a stronger economy. The Health Action Network is an Elevance Health, Inc., initiative.