Post Election Health Policy: What Self-Funded Employers Need to Know

As we approach the 2024 presidential election, as well as congressional and Wisconsin state elections, the results of key health policy issues could shape benefit plan designs and influence healthcare costs. Especially as employers face rising medical cost trends and prescription drug expenses, which now account for 40-60% of their total healthcare spend. Now is the time to prepare your business for the challenges and opportunities that lie ahead in 2025.  

The Alliance recently hosted a webinar featuring a panel discussion with Josh Bindl, CEO at National CooperativeRx, Rachel Ver Velde, Associate Vice President of Government Relations & Senior Political Advisor at Wisconsin Manufacturers & Commerce (WMC), and Melissa Duffy, Owner of Duffy Communication Strategies. This engaging discussion covered proposed health reforms that could significantly impact self-funded employers based on the outcome of the election. Read on to get the most important health policy insights from the discussion. You can also watch the event on demand and get access to the event resources here.  

Healthcare Price Transparency  

Healthcare price transparency is an essential component to favorably bend the medical cost trend for employers and their employees and families. Price transparency empowers patients and employers by providing clear, upfront information about the costs of medical services. This enables cost comparisons across providers for informed decision-making. Healthcare price transparency can lead to lower healthcare costs, reduced surprise billing, and increased competition among providers. This incentivizes better quality care at competitive costs.  

Healthcare price transparency is currently a regulation, meaning it could be revoked if a future president opposes it. Codifying it into law would prevent it from being easily repealed. Healthcare price transparency is a bipartisan issue, with both parties recognizing its importance for employers and healthcare consumers. Price transparency is evolving, with accessibility and quality of information continuously improving. 

A bill introduced in the last legislative session aims to incorporate federal hospital transparency requirements into Wisconsin state law. This would grant the Department of Health Services (DHS) the power to investigate, audit, and enforce these transparency standards at the state level. The DHS would also be tasked with submitting a report every two years, recommending potential amendments to the legislation. The bill would require hospitals to publish a list of prices for 300 shoppable services. This would allow employers to compare costs across facilities. An alternative proposal discussed last session would authorize the state’s All Payers Claims Database (Wisconsin Health Information Organization – WHIO) to develop an online portal for employers to compare all-inclusive prices for the same 300 services. 

Pharmacy Benefit Manager (PBM) Reform  

PBM reform is a major focus in congress and state legislatures nationwide. A bill proposed in Wisconsin aims to address concerns from independent pharmacies about what they consider unfair practices by PBMs, and indirectly, employer plans. The bill contains several key provisions that would impact employer plan designs. These provisions include a ban on PBMs partnering with employers to offer incentives for mail-order pharmacy use. Under the proposed legislation, PBMs would be prohibited from lowering premiums. They would also prohibit deductibles, copays, or benefits to steer consumers toward specific retail, mail-order, or other pharmacy providers.  

This proposal also includes “any willing provider” language. This language prevents PBMs from excluding pharmacies that are willing to accept the same payment terms as other network pharmacies. Additionally, the bill incorporates a copay accumulator proposal and clarifies that PBMs would be considered fiduciaries. 

Copay Accumulator Legislation 

This proposal was introduced during the last legislative session, both as a standalone bill and as part of the PBM reform bill. This legislation would require PBMs to count third-party payments, such as drug coupons or financial assistance from pharmaceutical manufacturers, toward enrollees’ cost-sharing obligations, including out-of-pocket maximums. The concern for employers is that this would undermine health plan cost-sharing structures and eliminate “copay accumulator” or “copay maximizer” pharmacy benefit designs used by some Wisconsin employers and PBMs to control drug costs.  

The proposal would remove incentives for drugmakers to lower prices on brand-name medications. Additionally, it would weaken the effectiveness of deductibles, copays, and coinsurance, which are key tools in value-based benefit designs that encourage enrollees to choose higher-value, cost-effective alternatives.  

At first glance, employers may not understand the bill’s full implications. However, certain provisions in this bill would undermine employers’ efforts. If this bill passed it would almost certainly inflate the cost of medications that have coupons. It is important to note that prescription coupons are prohibited in Medicare and Medicaid. This is due to concerns about inflating cost and encouraging waste. 

Prompt Pay Bill 

The name of this bill is misleading and may sound benign. It is important for employers to fully understand its implications. Under current law, section 146.905 of the Wisconsin Statutes prohibits healthcare providers from reducing or eliminating copays, coinsurance, or deductibles required by an insurance policy. Legislation introduced last session would repeal this provision. Hospitals have stated they support the bill to offer prompt pay discounts to patients. However, the proposal does not define “prompt” or “discounts,” potentially allowing providers to eliminate all patient cost-sharing for services. Employers who have implemented plan designs to guide enrollees toward preferred-value providers have raised significant concerns about this health policy legislation. 

White Bagging Ban 

White bagging, or alternative medication sourcing, allows employers to work with their preferred pharmacy partners. This allows them to send clinician-administered medications directly to the site of care when it is safe and cost-effective. This approach helps employer plans avoid significant hospital markups on specialty medications, which average 200-400% with some hospitals marking up medications 900-1000%. 

A proposal introduced during the 2021-22 session sought to prohibit health plans, PBMs, and insurance intermediaries from using alternative sourcing for clinician-administered medications. The bill would have required health plans to authorize, pay for, or approve such drugs from hospital pharmacies in almost every situation, while barring benefit limitations, higher copays, or penalties for medications sourced from those pharmacies. Employers played a key role in preventing the ban on white bagging from passing during the 2021-22 session, and it was not reintroduced last session. However, there are indications that the bill’s author plans to introduce it again in the 2025-26 session. So, it is crucial for employers to unite on this issue again.  

Get Involved 

Legislation directly impacts businesses, employees, and families. So, it is essential for employers to stay informed and engaged on health policy. Organizations like Advancing Free Market Healthcare (AFMH) are helping employers come together to make legislative change. You can join the cause by including your business’s logo on a letter or speaking with your legislators. A previous memo, supported by 100+ employers and their logos, was highly effective. Proof that a simple action can have a big impact. 

Learn more about how you can get involved in health policy with Advancing Free Market Healthcare.