State of the states

A recent webinar from IQVIA Institute, “Health Policy Forum: Policy Priorities for the Next U.S. Administration,” discussed policy change at the state level that could potentially effect the larger access audience.

Medicaid

Lanhee Chen, JD, PhD, David and Diane Steffy Fellow in American Public Policy Studies at The Hoover Institution, Stanford University, said, "Medicaid is an area ripe for reform, but it's tremendously difficult to implement from a top-down perspective.” He noted that many states are already grappling with various elements of their Medicaid programs. However, he also predicted significant reforms and potential changes to Medicaid at the state level over the next several years. "That's really where I would look for potential changes happening to Medicaid," he said, highlighting that many states are eager to experiment with altering or reforming the program within their capabilities

Sloane Salzburg, Vice President of the Council for Affordable Health Coverage, noted that value-based payment arrangements as a policy approach are gaining momentum across Medicaid, Medicare, and private markets. Salzburg noted that 24 states have already implemented state plan amendments for these arrangements.

"These value-based payment arrangements typically involve high-cost drugs, such as gene and cell therapies that can cost millions of dollars," Salzburg explained. "The concept is simple: you pay if the drug works, and if it doesn't, you get some kind of refund or rebate."

Richard Frank, PhD, Senior Fellow and Director of the Schaeffer Initiative on Medicaid Health Policy at The Brookings Institution, expressed concerns around value-based payments. "The process of trying to figure out how to pay if things work when you don't know whether things are going to work for another 10 or 15 years is very tough," he said.

He suggested that clarification around the value-based policies are needed as current approaches are still experimental and not clearly thought out. But he said, “I do think that Medicaid is a place where there is potential to sort out the tension between the various approaches. I do think we've seen some important steps towards expanding Medicaid among some of the states that were reluctant to do so.”

Drug Price Negotiation

Related to pricing at the state level, Patricia Kelmar, JD, PhD, Senior Director - Health Care Campaigns for Public Interest Research Group, suggested that while actually having the IRA be a law is huge in regard to drug price negotiation at the federal level, litigation challenges remain, which will continue to be a constant battle on the legal front to keep it in place.

Kelmar said, “There’s a lot of states working on prescription drug affordability boards, which are suggesting price caps on particular types of medications. Those are just getting off the ground. And that's one way that the states are stepping up to try to do their own solutions for prescription drugs, because it's really hard at the state level to control those costs.”

PBMs

Kelmar also noted that the Federal Trade Commission in the health care space has been active the last couple of years, but efforts at that level take a long time, so the activity hasn’t yet shown results.

“But we've also seen our states getting really involved,” said Kelmar. “Attorneys Generals are asking for more power to look at smaller types of consolidation. Usually there's a trigger point of how many dollars or what the market impact is, and so we're starting to see more efforts at the state level to take control of the little roll ups that end up being a large healthcare system roll up.” Kelmar noted that is how the change will start. “If there's no action on the federal level, we'll be seeing that at state level.”

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