Congress left behind a lot of unfinished business when it departed Washington last week to commence a month-long recess, including matters of vital importance to the health insurance sector. Modern Healthcare spoke with Blue Cross Blue Shield Association CEO Kim Keck about the federation's policy agenda for the remainder of 2023.
The Blue Cross Blue Shield Association–which comprises 34 licensees that insure one-third of Americans—unveiled a suite of policy proposals aimed at making healthcare more affordable, for example, by taking aim at providers and drugmakers. Keck outlined several issues that Blues' plans hope Congress addresses as the end of the fiscal year approaches on Sept. 30. This interview has been edited for length and clarity.
On costs and provider consolidation
The prices of healthcare services are what drive the cost of health insurance, and those prices are largely hospitals and drugs. So one of the components is about increasing competition in the provider space.
We've seen tremendous consolidation in the provider space. We know what happens when that consolidation happens. Providers merge with providers, often hospital systems buy physician groups, and our data would suggest costs go up.
Another component is all the things that increase access to affordable drugs. We're doing that from a policy perspective, but also from how we're investing our dollars.
The third component of the affordability platform is largely around what we call person-centered care or quality care. This whole notion of removing ourselves from our fee-for-service system in the United States, where somebody else's revenue was really our cost, and really moving to a place where we're outcomes-based, and we're coordinated, and we’re team-based, and we're using technology and we're more incenting efficient care.
On site-neutral payments
One of the biggest pieces of our platform is site-neutral payments. It's getting a ton of traction on the Hill, and we'll see where it lands. The fact that we've had as much conversation both in the House and the Senate on this topic is not inconsequential. We know from our own data that you can get a mammogram at your physician's office versus a hospital outpatient facility, and that might be the same exact image, and the price can be 20%-25% higher in one place than it is in the other. In some instances, chemotherapies can be 2-3 times higher, depending on the setting. Lots of other image-related services would fall in that category.
That would probably be an example of the biggest component of a policy change that could get at the impacts from the consolidation that's already happened, and could at least level the playing field to say we can't necessarily ask people to pay more for the same service just because it's in a different place.
It has tremendous pushback from the hospital association. But, candidly, it’s getting a lot of traction on the Hill as an issue that just makes sense to the average person.
On Center for Medicare and Medicaid Innovation initiatives
We've also been working on advancing some of the models in [the CMMI] to say, look, we've tried some of these models and value-based care for the better part of a decade, we need to institutionalize them. They have to just be part of how we practice across payers and providers.
I think there's been a lot of good work. My gut here is that we need to focus. [Innovation center Director Liz Fowler] and her team have done a lot to take out programs that might not have been producing outcomes at the pace or at the impact that that we were all expecting. I happen to believe we should not just experiment—we should make permanent.
I don't want to call them mandatory, but I want to force us to say we've got to stop making these incremental incentive payments for quality and innovation, candidly, and make them just the way we expect care to be delivered and reimbursed.
On PBMs and drug prices
I don't think there's one model that works best within the PBM space. Having said that, we've got to get our list prices on drugs to be lower. The reality is we know that so many of our medications are out of reach because they just cost so much.
The data we have from PBMs would say that, in many instances, there's reductions in cost upwards of 50% of what those list prices are today because of the fact that the PBM exists. I think that we have innovated around this space [but] I don't think the pace of change has been happening where we really need it.
Transparency and PBMs seem to be a big theme across the Senate Finance Committee, [the Health, Education, Labor and Pensions Committee], across many [congressional committees]. We have been subjected to transparency, hospitals and providers and payers, for some period of time. It's hard to say that PBMs shouldn't have transparency.
We're more focused in many respects, though, on the specialty drugs. That's where a significant portion of our spend is today. It's north of 50% and going higher. That's not the traditional role of the PBM.
On Ozempic and Wegovy
I love the change we're seeing in this sector of healthcare. It is such a rapidly evolving ecosystem ... and there's so much opportunity for innovation and change. I love that. But I do worry a little bit about the fact that often our science moves faster than our financial system or our economic system, and sometimes faster than our regulatory system.
I do worry a little that these innovations catch on, particularly at a time now when people who have tried so many different therapies think, "This is it. My life will be changed." We're driving adoption at a rate faster than us knowing the effectiveness.
We don't have a financing system in this country for that level of science. Think about Medicare. If they were allowed in Medicare, the price tag is $100 billion a year.
I think there is promise, and I do worry. It comes back to this affordability. Because if people can't afford this medicine, or we don't fully appreciate what it takes, we're spending lots of money to keep people on these drugs. And guess what? When they go off their drugs, everything is undone.