August 24, 2023
Health Policy Insights

When health policy issues arise – and affect self-funded employers – we will share insights into each issue to better educate employers. These emails will be sent occasionally throughout the year, but primarily during peak “legislative season.”

At the State Level

State Legislature Moves Past Budget

The 2023-25 Wisconsin state budget was signed into law in July, making way for other legislation to move forward this session.

The legislature removed one provision of particular interest to employers before sending the budget to the governor’s desk. That provision would have provided funding to continue a study of low-value healthcare in Wisconsin - services that do not improve patient outcomes and may cause harm, which the Department of Health Services calls “a quality, safety, health equity, and cost-efficiency issue that contributes to the inappropriate use of scarce healthcare workforce resources in Wisconsin.”

The Alliance was disappointed to see the provision removed and hopes to see funding for the low-value care study and the Wisconsin Health Information Organization (WHIO) advance as part of separate legislation this fall. The WHIO is Wisconsin’s All-Payer Claims Database which is one of the data sources The Alliance uses to identify health professionals and organizations delivering high-value healthcare services in the state of Wisconsin. This kind of analysis drives our Smarter Networks^SM strategy and empowers our members to design plans to incentivize enrollees to use providers and health systems that deliver better outcomes at a lower cost. If you are interested in learning more about the value of healthcare in Wisconsin and how you can help improve it, register for our next webinar Improve the Value of Healthcare in Wisconsin: Avoid Low-Value Care.

Other issues expected to be on the fall legislative agenda include PBM reform and the Know Your Healthcare Costs Act transparency bill that we covered in a previous newsletter.

At the Federal Level

Federal Agencies Issue Proposed Mental Health Parity Regulations

The Departments of Labor, Health and Human Services and Treasury have proposed joint regulations related to the Mental Health Parity and Addiction Equity Act (MHPAEA) that if finalized will have significant implications for employer plans.

MHPAEA was approved in 2008 to build upon previous laws that require employers and insurers to provide the same or better health benefits for behavioral healthcare as they do for medical or surgical healthcare. Since then, MHPAEA has been amended twice. First, in 2010, to apply parity requirements to “Non-Quantitative Treatment Limits” or NQTLs, which are processes, standards or criteria that limit the scope of benefits, but that aren’t quantifiable as a number, such as prior authorization, step therapy, provider reimbursement methodologies, network restrictions and others. They amended the law a second time in 2021 to require employers and issuers to prepare comparative analyses to document that their plans’ NQTLs were not more restrictive for mental health and substance use disorder benefits than they were for medical and surgical care.

The newly proposed regulations were accompanied by a 2023 Report to Congress, an enforcement fact sheet, and Technical Release 2023-01P which outlines requirements around network composition. The Alliance is reviewing these regulations in preparation to help our members comply with the new requirements once finalized. The Report to Congress notes that no employers or issuers were found to be compliant with MHPAEA at the start of their audits, which have impacted around 200 health plans so far. The report also describes efforts to step up enforcement from here.

The new regulations introduce a 3-part test for plans to determine whether NQTLs impose greater limits on MH/SUD benefits versus medical/surgical benefits. The technical release goes into greater detail on how this 3-part test would apply to network composition. The three tests are as follows:

Requires plans to evaluate payments to determine whether NQTL are more restrictive than the “predominant” NQTL that applies to two-thirds of med/surg benefits in each of six classifications (inpatient in-network, in-patient out of network, outpatient in-network, outpatient out of network, emergency care and prescription drugs).
Prohibits plans to identify factors and evidentiary standards used to design NQTLs and ensure those are not discriminatory and
Requires plans to collect, evaluate and consider the impact of relevant comparative data and address any material differences.

Comments are being collected on the proposed rule and the technical release until October 2, 2023. The Alliance is planning a webinar on MHPAEA Compliance in November. You can register for the event here.

Federal PBM Legislation Advances

In Congress, several house and Senate committees have purview over healthcare issues, and oftentimes each committee passes its own version of reform over big issues. Then, these different committees ultimately negotiate a final package that is often passed as part of an omnibus spending bill.

That is the case this session when it comes to pharmacy benefit manager (PBM) reforms. This Commonwealth Fund article explains the various issues that are being discussed in our nation’s capital right now that are likely to affect the agreements employers (or their TPAs) have in place with PBMs. Some promising issues include significant transparency requirements that will detail the flow of money between pharmaceutical manufacturers, PBMs, plans and pharmacies and restrictions on how PBMs can make their money.

The Alliance will continue to track this issue and inform members about changes that are ultimately passed into law.

Health Policy Issues We Are Following


State Issues
Bill or Issue	The Alliance Position	Summary and Implications for Employers	Status
SB 100 AB 103 Drug Assistance Programs	We have concerns	Pharma-sponsored legislation that would require self-funded municipal plans and PBMs to count the value of drug coupons offered by drug manufacturers toward deductibles and maximum out-of-pockets, ensuring that anyone using drug coupons will satisfy cost-sharing requirements faster. Since this would apply to PBMs, it is uncertain whether the bill would be preempted by ERISA for non-municipal self-funded plans.	Senate bill has been referred to the Senate Insurance Committee, its Assembly companion has been referred to the Assembly Health Committee. No hearings have been scheduled as of the date of writing.
AB 62 SB 63 Assignment of Dental Benefits	No position yet	Would impact self-funded government plans but not others. Allows an individual insured under a health benefit plan that includes dental coverage to assign reimbursement for dental and related services directly to a dental provider. The plan would then have to directly pay the provider the amount of any claim under the same criteria and payment schedule under which it would have reimbursed the insured.	Insurer interests are pursuing an amendment to narrow the scope of this bill to dental-only plans which we would support. Referred to Assembly Committee on Insurance and Small Business. No hearings scheduled at the time of writing.
AB 43/SB 70 State Budget Bills	No overarching position	The Alliance supported funding for a study of low-value care in Wisconsin, which was removed by the Joint Committee on Finance before passage.	Signed into law.
SB 121 AB 117 Advanced Mammography Mandate	The Alliance is opposed to all mandates given the resultant impact on costs.	Would require health plans, including self-funded public employee plans, to cover advanced mammography at $0 for individuals with dense breast tissue or who are at higher risk for breast cancer. We are concerned mandated coverage will increase the cost of these screenings.	Senate bill has been referred to the Senate Committee on Health, which is chaired by the bill’s author. A hearing was held on July 12, 2023, and no further action has been taken as of writing.
SB 145 AB 154 Advanced Practice Registered Nurses	Support	Modernizes the licensure requirements for advanced practice nurses and eliminates the requirement that they must always practice under a collaborative agreement with a physician (but employers may still require this).	Both bills have been referred to the Health Committees in their respective houses. A hearing was held on the Senate bill in May. No further action scheduled as of the time of this writing.
AB 176 SB 211 Pharmacists & Contraception	No position yet	Permits a pharmacist to prescribe and dispense hormonal contraceptive patches and self-administered oral hormonal contraceptives in accordance with certain rules.	AB 176 passed the Assembly on a vote of 82-11 and was referred to the Senate Health Committee. A hearing was held.
SB 328 AB 338 Hospital Transparency	Support	Would codify federal hospital transparency regulations into state law and impose penalties on hospitals for noncompliance.	Both bills have been referred to the Health Committees in their respective houses. Hearings have not yet been scheduled.
Federal Issues
S127 Pharmacy Benefit Manager Transparency Act of 2023	Looking for changes	Would prohibit “spread pricing” by PBMs and encourage full and complete disclosure of prices, fees, markups, rebates and discounts to plan sponsors, plus require PBMs to file annual reports to the FTC. National employer groups are working on amendments. Read the committee summary.	Advanced by committee.
S1339 The Pharmacy Benefit Manager Reform Act	Support	The bill would require PBM transparency, so employers know what a PBM pays for a drug, how a PBM is making money, and what arrangements it has with drug manufacturers and other third parties. It would also ban “spread pricing,” which allows a PBM to charge an employer or patient more than the PBM pays for a drug. Additionally, the bill would require 100% pass-through of rebates, discounts, fees, and other payments from drug manufacturers.	Advanced by committee.
HR 3561 The PATIENT Act of 2023	No position yet	Includes numerous provisions that have been parts of different proposals advanced last session.	Advanced by committee.
HR 4509 The Transparency in Billing Act	Support	Would require off-campus hospital outpatient departments to obtain a separate unique health identifier and include it on all claims for services billed to commercial group health plans or their enrollees.	Advanced by committee.
HR 4822 The Health Care Price Transparency Act of 2023	Support	Includes a number of transparency provisions and incorporates provisions of the transparency in billing act (see above).	Advanced by committee.
No Surprises Act Lawsuits	N/A	There are several lawsuits that challenge the No Surprises Act rules issued by HHS/Labor. Many of the lawsuits are challenging the rule’s direction that requires arbiters to consider the “Qualified Payment Amount” (QPA or median in network amount) as the dominant factor when settling payment disputes. Since the No Surprises Act took effect on 1/1/22, the lawsuits have created uncertainty for health plans. As of today, arbiters are not required to rely on the QPA as the dominant factor, which is likely to lead to more disputes and higher settlement amounts in the interim. The latest ruling even challenged the fees charged by HHS.	Court rulings, particularly in Texas, continue to hamper the No Suprises Act. A recent ruling in favor of challengers found that HHS may not place any emphasis on the QPA in regulations. HHS has issued updated guidance here. An even later ruling halted the amount of fees HHS were charging providers for filing disputes, which has shut down the portal for several days.
Braidwood vs. Becerra	N/A	A lawsuit challenging no cost preventive care requirements was recently decided in favor of the plaintiffs, meaning that certain preventive care requirements are no longer enforceable by HHS/Labor. Services affected are only the services that were added or modified after passage of the ACA. The Department of Justice is appealing the decision and requesting a stay, but no stay has been issued to date, leaving the future uncertain for the requirements and plans that must comply with them.	A recent ruling partially vacated requirements defined by the USPSTF on or after March 23, 2010. HHS has updated guidance here.
Mental Health Parity Regulations	Still reviewing	Imposes additional requirements on employer plans in complying with the Mental Health Parity and Equity Addiction Act.	Comments due October 2, 2023. Proposed rules would take effect January 1, 2025, although this could change when final rules are issued.

* The information provided in this newsletter is for general informational purposes only and does not, and is not intended to, constitute legal advice.

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