In the News: Nov 22–29

Small Employers’ Use of Workplace Clinics Continues to Grow

A recent Modern Healthcare article discusses how the use of on-site or near-site clinics by small employers continues to grow as employers are challenged with rising health care costs. Approximately 30 third-party vendors that operate these clinics have been established in the past few years. These vendors allow small companies to partner and share a clinic with less upfront investment while still seeing enough patients to remain financially viable.

Despite increased interest by small employers, large employers are still more likely to offer on-site or near-site clinics as a benefit to their employees. According to a survey by Mercer and the National Association of Worksite Health Centers, approximately one-third of employers with 5,000 or more workers provided an on-site or near-site clinic in 2017—an increase from 24% in 2012. In contrast, 16% of employers with 500 to 4,999 employees provided the same benefit, compared to 14% in 2007.

Hospitals and health systems have developed a range of employer contracting offerings to address the increased interest by employers. Sg2 believes there are converging forces that are making employer contracting an increasingly vital strategy for health systems, allowing them to capture commercial volumes by addressing employers’ pain points. To learn more about employer contracting strategies, read the Sg2 Report Employer Contracting: Strategies for Netting Commercial Revenue.

CMS Intends to Study Impact of Home Health Agency Quality Measures in 2019

According to a recent Modern Healthcare article, CMS intends to study the impact of quality measures on home health agencies using a survey. The survey, which is pending approval by the White House, would begin in August 2019, with results published in 2021. With over 12,000 home health agencies and approximately $18 billion a year in Medicare spending on home health claims, the survey will inform CMS on how home health agencies are performing under the current set of quality measures.

Sg2 believes that ongoing changes in Medicare post-acute care (PAC) payment and policy will require health systems to increasingly consider partnerships to more efficiently and effectively manage the postdischarge pathway, including home health. To learn more about PAC payment and policy trends, watch the Sg2 on-demand webinar Post-Acute Care: Payment, Policy and Partnerships.

CMS Approves Michigan’s Value-Based Drug-Purchasing Medicaid Waiver

CMS recently approved Michigan’s Medicaid waiver, which will allow the state to negotiate Medicaid drug prices based on patient outcomes. Outcomes-based contracts will give Michigan the authority to leverage additional rebate agreements with drug manufacturers. This is the second time CMS approved this type of waiver, with Oklahoma being the first state to implement the waiver back in June. While Oklahoma currently has 4 alternative payment contracts for 4 drugs, no cost savings have yet been reported.

With spending on drugs increasing for payers, providers and patients alike—especially for high-cost specialty drugs and biologics—health care organizations across the board are looking for solutions to prepare for, absorb or reduce drug spending. Given these trends and recent payment changes to the 340B program, Sg2 believes that strategies to combat rising drug costs will be essential for health systems to survive. For tips on how to alleviate increasing drug prices, read the Sg2 expert insight Don’t Despair! Strategies to Mitigate Rising Drug Costs.

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