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Higher Financial Burden for Small-Firm Employees in Health Insurance Costs Compared with Large Firms, Study Finds

Peter Wehrwein has been the lead editor of Managed Healthcare Executive since February 2020.

Spending reached $4.86 trillion in 2023, a 7.5% increase from 2022 The growth in spending on hospital care was the highest since 1990.

Hospital, Prescription Drug Spending Fuel Big Jump in U.S. Healthcare Spending

Originally approved in 2009, Stelara patents began expiring in 2023, leading to an influx of recent biosimilars. 

FDA Approves Seventh Stelara Biosimilar, Steqeyma

If approved, clesrovimab would be the first and only FDA approved single dose immunization for infants approved in time for next year's RSV season, which lasts from October to April.

FDA Accepts Biologics License Application for Infant RSV Antibody 

Managed Healthcare Executive provides C-suite executives at health plans and provider organizations with news, analysis, insights, and strategies to pursue value-driven solutions.

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Healthcare finance sub-trends that will make a significant impact on healthcare in the new year.

4 Key Trends to Affect Healthcare Significantly in 2020

When it comes to cancer treatment, determining the right therapy as quickly as possible can make a life-saving difference. An analysis, published September 2024 in the 

Journal of Managed Care & Specialty Pharmacy

 suggests that a type of broad molecular testing, known as next-generation sequencing, not only identifies more treatable mutations in people with metastatic lung cancer, but also cuts healthcare costs.

Certain targeted medications for cancer are only effective if the cancer has specific mutations. If a mutation is missed, the patient may not get the right treatment. For example, newer drugs, such as Janssen’s 

 (amivantamab-vmjw) only work for certain types of non-small cell lung cancer with particular EGFR mutations (exon 20 insertion mutations, exon 19 deletions and exon 21 L858R substitution mutations).

Clinicians commonly use polymerase chain reaction (PCR) testing to check for cancer mutations, but this method can only check for one mutation at a time. If no mutation is found, additional PCR tests may be needed, which takes time and can miss other important mutations. In contrast, next-generation sequencing (NGS) tests for hundreds of mutations at once, giving a complete snapshot of the cancer's DNA in a single test. Although NGS typically costs more upfront, questions remain whether it can reduce overall costs and improve outcomes compared to PCR testing

To learn more about the financial and clinical impact of NGS versus PCR testing, a modeling study was conducted by researchers at the University of Chicago and Janssen Scientific Affairs, with 

 associate professor at University of Chicago Medicine, as the first author. Researchers used a Markov model to compare the costs and outcomes of NGS and PCR testing over three years.

The study modeled the outcomes of 100 patients who were newly diagnosed with metastatic non-small cell lung cancer. Data from previous research were used to estimate survival and costs. Test results were used to start either targeted treatment for their specific mutation or general, nontargeted treatment like chemotherapy.

The results showed that about 46% of NGS-tested patients and 40% of PCR-tested patients had actionable mutations. The model found NGS saved $7,386 per patient in the first year, mainly due to lower testing costs and fewer care delays. Treatment costs were similar for both (NGS: $305,644; PCR: $305,283). PCR patients faced additional costs for inappropriate first-line nontargeted therapy, reaching $6,569 by the third year. Over time, NGS led to $4,060 in savings at two years and $1,092 at three years.

The researchers also found that NGS helped identify more patients eligible for targeted therapies, resulting in earlier and more effective treatment. Those tested with NGS also had longer survival times, with some patients gaining up to 10 additional months of progression-free survival and more than five months of overall survival compared to patients whose actionable mutations were missed by PCR testing.

By helping clinicians identify more treatable mutations early, the authors concluded that broad molecular profiling through NGS will improve survival outcomes and reduce costs associated with delayed or inappropriate treatments.

“These findings warrant consideration in terms of policies that may address barriers related to increasing adoption of NGS in real-world clinical practice,” wrote Bestvina and her co-authors.

This study was funded by Janssen Scientific Affairs LLC, a Johnson & Johnson company.

Clinical

Next-Generation Testing Cheaper and More Effective for Guiding Lung Cancer Treatment

Three times in the last 20 years, the American Academy of Ophthalmology has updated guidelines for dosing of hydroxychloroquine (HCQ) and recommendations for detecting retinopathy at the earliest possible stage; as tests for finding asymptomatic HCQ retinopathy have improved the condition had be founder earlier, and the AAO’s limits on safe dosing have declined.

, “Rethinking the Hydroxychloroquine Dosing and Retinopathy Screening Guidelines,” there was a problem with this process, which led poor uptake of the recommendations: the prescribing physicians who would have to manage the autoimmune disease were left out of the process, “but must live with the ramifications of the guidelines.”

The authors are ophthalmologist David J. Browing, M.D., Ph.D.; rheumatologist Naoto Yokogawa, M.D.; ophthalmologist Paul B. Greenberg, M.D., MPH; and ophthalmologist Elliot Perlman, M.D.

“Hydroxychloroquine is effective in many autoimmune diseases, particularly in patients with systemic lupus erythematosus (SLE),” authors of the new editorial note. “Hydroxychloroquine is recommended to all SLE patients, unless contraindicated, due to the multiple beneficial effects on survival, disease activity, and the risks of organ damage and thromboembolic episodes.”

While there are alternatives to HCQ, these may cost more and have more side effects, the authors said. And, the 2016 guidelines in particular failed to adequately account for the challenge that prescribing physicians face as the obesity epidemic intensifies, and the gap between real body weight and ideal body weight increases.

Thus, prescribing physicians faced with the 2016 update were in a tight spot: if they failed to adhere to the AAO guidelines, they would appear to be ignoring patient safety, when in fact doctors and patients “are making calculated decisions balancing the risks of HCQ retinopathy with damage to other organ systems.”

Early and frequent testing for HCQ retinopathy is still important, the authors write, but finding this condition at the earliest possible stage should be “an important subsidiary goal, not the primary goal.” The mission of the of the prescribing physician managing autoimmune disease and the ophthalmologist should be the same: “controlling systemic disease without endangering vision.”


A prospective study is needed to clarify the point at which retinopathy progresses despite stopping HCQ. Absent those results, the current recommendation to stop HCQ at the first sign of trouble must be reconsidered. New guidelines, which would reflect input from prescribing physicians, would “reflect a more nuanced approach,” and acknowledge that evidence is limited.

The authors pointed to six questions they said need answers to settle current controversies in HCQ dosing:

How does HCQ distribute between adipose tissue (fat) and lean tissue?

What are the key indicators at which HCQ retinopathy progresses even if the drug is stopped?

What are the relative sensitivities and specificities of tests for HCQ retinopathy?

How can renal disease be measured in HCQ dosing?

What is the connection between cumulative HCQ dose and HCQ risk?

Prospective studies are needed to answer these questions. In the meantime, specialists who care for patients with autoimmune disease must take part in the AAO committee that revises the next set of guidelines, the authors said. “By acknowledging the complementary roles of prescribers and ophthalmologists, this approach will lead to wider acceptance of guidelines and better care for our patients,” they said.

Guidelines to prevent retinopathy caused by a drug to treat autoimmune disease must be developed jointly by ophthalmologists and prescribing physicians, journal authors say.

For Better HCQ Retinopathy Guidelines, Include Prescribing Physicians

Quality measures are a tool to drive healthcare toward value-based care, and in diabetes care these measures can improve diabetes management and prevent downstream conditions, such as cardiovascular disease. However, there are multiple hurdles that healthcare organizations face when implementing quality measures for diabetes care, explained Sean M. Oser, M.D., M.P.H., associate professor in the Department of Family Medicine at the University of Colorado School of Medicine, in a 

There are many differences between recommendations for quality measures and reimbursement policies for covered services from different insurers. Although Oser suggested that these all need to be streamlined, in the interim, health systems and provider organizations should have a quality improvement program or team to help understand these requirements. The team can translate the requirements down to the practice level from the health plan or health system and gather data from the electronic health record (EHR) to turn it into an actionable report.

The ability to generate reports allows providers and health systems to track measurement and performance over time to see what progress, if any, is being made. He recommends ensuring there is transparency with stakeholders so they can also follow the progress or see where improvements are lagging. “There is a ton of data that we have available now to try to improve our performance on quality measures and to target where they are not being met,” Oser said.

Advanced EHRs have the capability to generate reports and identify care gaps in real time, too. Previously, when using paper records or older EHRs, Oser would have to search through them to find the latest laboratory results to see the patient’s hemoglobin A1C level or the date of their most recent eye exam. Now, when that data is entered into the EHR, care gaps are highlighted as soon as the patient’s chart is opened during the visit.

Communication is another important aspect of filling those gaps. Patients or providers might get letters from health plans indicating that a patient who has diabetes might not be taking their statin based on claims information, but Oser doesn’t view that communication as very actionable at the practice level. What has been more successful is using care managers or nurses at the health plan to reach out to patients directly to be their personal care manager. “Actual face-to-face — or at least person to person on a telephone — communication can be a whole lot more effective than some of those letters that are received,” he said.

Another area where data has evolved for the benefit of patients with diabetes is with continuous glucose monitoring (CGM), Oser noted. “We’ve relied for a very long time on hemoglobin A1C checks, and they remain extremely useful, but they’re not always right,” he said.

CGM measures glucose levels as frequently as every minute for up to 15 minutes depending on the system, and this data provides an average glucose level. Oser noted there is a small difference between average glucose and hemoglobin A1C. In the latter, the percent of the portion of the hemoglobin molecule that has glucose attached is being measured. While this is associated with average glucose levels, “it’s not a direct correlation,” he explained.

“CGM gives us the actual average glucose, which is what we’re really looking for in the first place,” Oser said. There are many reasons why a hemoglobin A1C level may be inaccurate, such as during pregnancy, in patients with chronic kidney disease, or in patients with variants of their hemoglobin, such as in sickle cell disease.

The National Committee for Quality Assurance recently changed the name of a measure from being based on hemoglobin A1C levels to glycemic management, which allows for a measure directly derived from CGM. Higher levels are associated with diabetic retinopathy, diabetic nephropathy, chronic kidney disease and more.

Traditionally, the thought is “the lower the A1C [level], the better,” Oser said. “But as we bring glucose levels down, it stands to reason that occasionally glucose levels will drop too low, and that can be very dangerous in the short term.”

Low levels are associated with seizures and severe hypoglycemia, but CGM devices can predict low glucose before it happens and sound an alert on the device to give the patient a chance to prevent hypoglycemia. “Since an alarming amount of hypoglycemia develops without any symptoms, CGM can be a real life-changer here,” Oser said.

However, CGMs also have a tremendous amount of raw data. The hope is that in the future, more EHR systems will be able to manage that raw data and produce insights the way CGM systems currently do. Reports from this data can also show how much time is spent within certain ranges and how much time is spent above or below the target range. The CGM data also show how much variability there is in glucose data.

A patient with a hemoglobin A1C level of 6.7% may have a lot of really high and really low glucose readings that averaged out to look like they are meeting the glycemic target. However, the CGM will provide the extra information that shows the patient is “experiencing pretty dangerous swings in glucose,” he said.

“It’s really revolutionized the way I care for people with diabetes when I feel CGM is appropriate, which is not in every case, but I’ll use it often and get a lot more information,” Oser said.

Oser says he follows up with the data from the CGM by engaging patients about their own care. One way he does this is by focusing on the things going well. If the CGM report has multiple measures and one met its target, he starts with that. For example, if someone’s average glucose level is always high, but they have no low glucose levels, Oser will explain how that is a positive. “I try really hard to avoid using language that is judging or leading,” he said. “Focusing on CGM, I’ve found, always gives me something to start with and always something to align with a patient to be able to let them know that this takes work."

There are also quality measures related to diabetes self-management, education and support (DSMES), which engage patients. Diabetes relies heavily on patient self-management, which involves taking all of the medications as prescribed, because patients often have multiple prescriptions; being mindful of what, when and how they eat; and paying attention to movement and exercise. “Often, people with diabetes are on blood pressure medications that can be impacted by diet as well as by activity,” Oser said. “So, everything is really interrelated. There’s a large burden of self-management. So DSMES programs can really help patients directly in those ways.”

Oser also discussed how quality measures can be adapted to address social determinants of health, comorbidities, socioeconomic challenges, or cultural, racial and ethnic differences. Data show African American and Hispanic patients are likely to have higher hemoglobin A1C levels than White patients despite having the same average glucose level. "There is an important cultural, ethnic, racial difference there where CGM, for example, which is measuring the glucose levels and can calculate the actual average glucose level, can get rid of that disparity,” he said.

Since getting to the physician’s office can be a challenge for some people who can’t take time off work or travel the distance, the CGM can eliminate some of those barriers by sending the data to the office. However, there are access challenges with CGM,even though coverage for CGM has been increasing and its cost has been coming down. Oser recommends having a CGM that the practice owns and can provide to the patient for episodic use. “There are [Current Procedural Terminology] codes, billing codes, for the activities around that [so] it’s an office-based charge instead of the patient having to pay a copay for supplies and for continuous use,” Oser said. “It’s also a really useful way for practices to become more engaged with and eventually more comfortable with CGM.”

Sean M. Oser, M.D., M.P.H., an associate professor in the Department of Family Medicine at the University of Colorado School of Medicine, discussed diabetes management and quality measures in a Managed Healthcare Executive K-Cast video series.

K-Cast Written Summary. Diabetes Quality Measures Have Challenges But Also Successes

Biologics have transformed the treatment of autoimmune diseases such as rheumatoid arthritis, psoriasis, Crohn’s disease and ulcerative colitis. Jill Zouzoulas, M.D., a rheumatologist at Tryon Medical Partners in Charlotte, North Carolina, and Jennifer Seminerio, M.D., director of inflammatory bowel disease at University of Southern Florida Health in Tampa, Florida, discussed biologics and their intravenous and subcutaneous delivery methods in 

Enbrel (etanercept), the first biologic used to treat rheumatoid arthritis, was approved by the FDA in 1998. A tumor necrosis factor inhibitor, Enbrel was a leap forward in treating the inflammation of rheumatoid arthritis with more precision. “Part of what attracted me to rheumatology is that we finally had targeted therapies,” noted Zouzoulas. The outcomes for the biologics were significantly better than they were for the other treatment drugs, she said.

Seminerio said biologics were already being used as she was undergoing training. “It’s been very exciting and interesting that our knowledge on how to use them correctly has only grown.” She said her experience with biologics has been very positive. “I think that it’s been an opportunity for us to get a disease state for which we don’t have a cure under control. What I mean by that is we don’t have a way to make ulcerative colitis or Crohn’s disease end — a cure — but we can put it into remission.”

Biologics can be delivered intravenously or as subcutaneous injections. Zouzoulas described the increasing availability of subcutaneous biologics as being “fantastic” for patients who are working. A lack of familiarity with self-injection and worry about pain can sometimes stir up reluctance. “In actuality,” said Zouzoulas, “once you walk the patient through that, once you train them how to use it and build the confidence, that quickly goes away and patients are just very happy that they don’t need to come in and take time away from their regular lives.” The risk of reaction is very low, Zouzoulas said, as is the chance of administering the wrong dose.

Seminerio said she has also worked to assuage patient fears of subcutaneous injection and that self-administration empowers patients, she said. “It allows them to feel like they’re still treating their disease, but they don’t have to give up key points in their life.” Seminerio said she can still recall her excitement for her patients when Stelara (ustekinumab), the first subcutaneous biologic for Crohn’s disease and ulcerative colitis, became available.

There are, though, advantages to IV infusions, noted Zouzoulas. Having patients come in regularly helps physicians and other clinicians monitor them and coordinate their care. The regularity of the visits helps patients build connections with staff and other patients, Zouzoulas said. “The nurses, especially in the infusion suite, come to know them over time, and they feel very much like they’re almost part of a community. And they tend to talk to each other and people are oftentimes scheduled on the same day so it almost in some ways is a support group for them.”

Body weight is a factor that Zouzoulas also considers. Many studies have shown that IV infusions are preferable for patients who weigh more than 100 kilograms [about 220 pounds], she said.

Seminerio said that IV formulations may be advantageous for patients for whom adherence is an issue. Clinicians and their staff can keep track of which patients come to an infusion center and receive treatment; self-administration of subcutaneous formulation is inherently more difficult to monitor. But Seminerio also stressedthe importance of patient choice.

Commercial insurers cover IV and subcutaneous therapies fairly similarly, according to Zouzoulas. Patients with traditional Medicare and Medigap coverage will have their biologic medication almost completely covered after meeting a deductible, she said. Those in a Medicare Advantage plan get 80% of the cost of an IV biologic covered, which Zouzoulas said may seem generous but “the remaining 20% is also a big number” given the price of the biologics.

Seminerio noted that the medical-pharmacy benefit divides in U.S. healthcare coverage: IV drugs are paid through the medical benefit whereas subcutaneous ones are paid through the pharmacy benefit. For clinicians working with an infusion center, billing through the medical benefit is usually a fairly streamlined process, she said, particularly for well-established drugs. Drugs paid for through the pharmacy benefit can, in contrast, be more problematic because of prior authorization and appeal processes that can take months and requirements that patients be treated with certain drugs before others. “Sometimes you just need to make sure that you’re staying on it,” she said. Specialty pharmacies step in and help with those processes, Seminerio said, although sometimes insurance companies mandate the use of specific specialty pharmacies.

Zouzoulas said staff in her office handle prior authorizations for the IV biologics because her office is buying the drug and administering it to the patient before getting reimbursed. Her office also handles prior authorizations for subcutaneous biologics, but Zouzoulas said that it is often an easy, online experience and that specialty pharmacies help with the process.

Biosimilars came into use very slowly in rheumatology, Zouzoulas said, starting with biosimilars to Remicade and Rituxan (rituximab). Over time, insurers have changed their formularies so patients often need to try one or two biosimilars before they will cover the brand-name product, said Zouzoulas. “Oftentimes patients will ask me how I pick a biosimilar. And I say, ‘I don’t. Your insurance does.’ ” Because biosimilars to IV biologics have driven down reimbursement rates, some doctors have stopped giving those drugs and have those patients go to freestanding corporate infusion suites or hospital infusion suites. In Zouzoulas’ view, biosimilars have benefited the distribution companies and pharmacy benefit managers while the out-of-pocket costs for patients have stayed the same.

Seminerio had a more positive outlook on biosimilars. She said the NOR-SWITCH study showed that patients can be safely switched from a brand-name drug to a biosimilar. If an insurer requires a switch, she says she stays matter-of-fact. “The way that I have that conversation with [the patient] is, ‘Listen, if we don’t do this, we’re going to end up with no medication. Or you’re going to end up paying a cost that may not be feasible for you. So let’s do it.’”

Zouzoulas said biologics are shifting away from IV formulations toward subcutaneous and oral ones. Drugmakers are less inclined to make an IV formulation of a biologic if they can make a subcutaneous one and are less likely to make both, she said.

Seminerio sees problems coming from the growing number of drugs. “With more drugs, with more mechanisms of action, there becomes a greater gap in our ability to know which one to use when you’re not specifically practicing [IBD] medicine.” She said it is up to IBD specialists to educate physicians coming into the field and practitioners in the community. Seminerio said she also wants to see more head-to-head trials such as the VARSITY trial, which compared Entyvio (an IV drug) to Humira (a subcutaneous one) in patients with moderate-to-severe ulcerative colitis. Entyvio proved to be more efficacious. “I think it allowed people to see that sometimes it isn’t a matter of just IV versus [subcutaneous]. It’s the drug itself and which one is going to work better.”

Jill Zouzoulas, M.D., of  Tryon Medical Partners in Charlotte, North Carolina, and Jennifer Seminerio, M.D., of University of Southern Florida Health in Tampa, Florida, discussed the biologics and the pros and cons of the intravenous and subcutaneous delivery methods in Managed Healthcare Executive’s K-Cast video series.

Brian Robertson

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