Tuesday Tidbits

Photo by Patrick Fore on Unsplash

Let’s lead off with the OPM Inspector General’s new annual report on top management challenges facing the agency. This is the first such report of the current Inspector General Krista Boyd. The report’s FEHB Program concerns focus on prescription drug spending, eligibility issues, and the Postal Service Health Benefits Program.

As the FEHBlog has noted, FEHB prescription drug spending is not a unique FEHB issue. While the Inspector General’s report calls attention to these statistics:

As in prior years, drug costs continue to increase in the FEHBP. Currently, total FEHBP drug
costs (excluding drugs administered in an inpatient hospital setting) represent approximately 32
percent of total health care costs. Approximately 23 percent of total FEHBP health care costs are
attributable to the pharmacy benefit alone (drugs dispensed through outpatient pharmacies). As
of 2021, FEHBP pharmacy benefits represented more than $13 billion annually.

To place these statistics in context, the FEHB again calls attention to the fact that the FEHB Program has a large cadre of annuitants with primary Medicare Parts A and B coverage. This group understandably does not enroll for Medicare Part D prescription drug coverage. As a result, Medicare picks up the bulk of cost of FEHB hospital and doctor expenses for this group, while FEHB covers virtually of the pharmacy spending for this group. The FEHBlog is unaware of any other large employer in this situation because employers who have retiree health coverage generally rely on Medicare Advantage plans.

The saving grace found in Congress’s design of the FEHB Program is that all enrollees are in one risk pool per plan option which allows carriers to compete and also use group insurance principles to spread costs among all enrollees. Medicare prime annuitant and younger enrollees subsidize the more costly people in the middle.

The FEHBlog agrees with the Inspector General that the FEHB has eligility issues principally because OPM in contrast to every other employer in the U.S. reports enrollment and premiums separately. Typically health plans receive enrollment rosters known as HIPAA 820 standard electronic transactions that list each enrolled individual and the premium paid for that individual. This allows the health plan to systematically compare the roster and premiums against their records. A plan for example would know that OPM is paying it for self only coverage when according to the plan’s records the member has self plus one coverage.

OPM has been building a master enrollment index which is one of the steps that OPM has been taking in the right direction. In the FEHBlog’s opinion, implementing the HIPAA 820 standard transaction would take eligibility off of the Inspector General list of management challenges.

As for the Postal Service Health Benefits Program, the FEHBlog has confident that OPM, with support from the Postal Service and carriers, to launch the PSHBP on time January 1, 2025.

Here’s a Govexec article on the report which takes a broader perspective.

From Omicron and siblings front —

  • STAT News reports on the federal government’s and drug manufactures efforts to close the developing treatment gap for immunocompromised folks who contract certain strains for Omicron, e.g., BA 4.2.y and BQ.1

[Monoclonal antibody] Evusheld is still effective against many variants, but it is not possible for physicians to know which strains a patient using it as prophylaxis could be exposed to, an AstraZeneca spokesperson told STAT.

“Variants are rarely dominant for more than a few months — they tend to either evolve further into different subvariants or are replaced by newer variants,” the spokesperson said, adding the company is running early studies on other antibody options. * * *

Complicating the matter, the next potential monoclonal antibody — an Eli Lilly treatment dubbed bebtelovimab — could be ready within two months, but it has already been shown ineffective against the other fast-rising variant, BQ.1. The federal government has purchased 60,000 bebtelovimab doses for uninsured and under-insured patients, according to two people familiar with the HHS monoclonal antibody planning.

In the HHS meeting, officials discussed the prospect that BA.4.6’s rise could render Evusheld ineffective within two months. They laid out the timelines for as many as six potential alternates in the pipeline, according to two people familiar with the discussion.

a new national biodefense strategy, aiming to adapt lessons drawn from the rocky response to the Covid-19 pandemic as it prepares the country for future public health emergencies.

The strategy, which has been long anticipated, includes such goals as strengthening public health workforces both in the United States and globally, and establishing international mechanisms to bolster laboratory safety.

The government’s plan outlines policy targets for more than 20 federal agencies to help the country and world try to prevent epidemics, detect them faster, respond when they occur, minimize their impact, and recover, senior administration officials said on a call with reporters Monday as they previewed the strategy. Oversight for the strategy will be at the White House, under the national security advisor.

  • On a related note, Insurance News Net discusses the pandemic’s adverse impact on the life insurance industry, and Healthcare Dive tells us “The HHS’ current management of the strategic national stockpile and its subsequent relaying of information to Congress is fractured and needs updates to ensure the country is prepared for future public health emergencies, according to a report from the Government Accountability Office.”

From the SDOH front, MedPage Today delves into a CDC Vital Signs reports released yesterday

Influenza-associated hospitalization rates were nearly 80% higher among Black adults compared with white adults from 2009-2010 to 2021-2022, according to a CDC Vital Signs report released Tuesday.

These rates were also 30% higher among American Indian/Alaska Native (AI/AN) adults and 20% higher among Hispanic adults compared with white adults, reported Carla L. Black, PhD, of the CDC’s National Center for Immunization and Respiratory Diseases, and colleagues.

Furthermore, vaccination coverage for influenza has been “consistently lower among Black, Hispanic, and American Indian and Alaska Native adults since 2010,” she noted on a call with reporters.

During the 2021-2022 flu season, vaccination coverage was lower among Hispanic (37.9%), AI/AN (40.9%), Black (42.0%), and other/multiple race (42.6%) adults compared with coverage among white (53.9%) and Asian (54.2%) adults, Black and team said.

From the IRS front, the Service issued its annual notice of inflation adjustments to tax items for the 2023 tax year. The Wall Street Journal adds “The Internal Revenue Service adjusted key tax code parameters for 2023 to reflect higher inflation, raising the standard deduction and the income thresholds where tax rates take effect.” The notice also includes many inflation adjustments to tax-exempt or deductible employees benefits. You will find a handy table of contents at the front of the notice.

From the miscellany department

  • The Justice Department on the Food and Drug Administration’s behalf has asked various federal courts to shut down the e-cigarette operations of six manufacturers.
  • The Justice Department also announced Sutter Health’s agreement “to pay $13 million to settle allegations that it billed government health programs for lab tests performed by others,” said U.S. Attorney Stephanie M. Hinds. ‘Government health care programs [including the FEHB in this case] must be protected, and this office will investigate and pursue health care providers that fail to provide the services paid for by public health care programs.’”

Apple will reportedly enter the health insurance business in 2024 in partnership with a major payer, Forbes reported Oct. 18.

CCS Insight’s chief analyst predicts the tech giant will power the new offering through health data collected by Apple Watches, such as blood pressure, blood oxygen levels, ECG readings and body temperature. The analyst said having access to this data from the beginning gives the company an advantage toward entering the market and cutting costs.

Apple is already a flagship partner in John Hancock’s Vitality program and UnitedHealthcare’s commercial plans.

  • Reg Jones writing in the Federal Times explains how to enroll for Medicare Part without incurring a late enrollment penalty. It’s not hard if you know the rules.