By: David Ostrowsky

Earlier this month, 2024 Benefest, hosted by the Massachusetts Chapter of the National Association of Benefits and Insurance Professionals (NABIP), took place at the DoubleTree by Hilton Hotel Boston-Westborough. While the conference largely focused on the Massachusetts healthcare ecosystem – panel discussions of which reached the general consensus that, from an affordability and access perspective, these are incredibly challenging times due to unprecedented staffing shortages reducing providers’ daily bandwidth – there was considerable time spent examining federal healthcare developments, including how November’s election will impact employer-sponsored benefit plans.

Some takeaways from the discussion:

• Prescription drug pricing: The Inflation Reduction Act has drastically impacted Medicare drug prices, which going forward means their limit is in line with inflation. In 2026, Medicare can begin negotiating the price of ten drugs, which will represent approximately 20 percent of Medicare drug spending. Over the following two years, fifteen more drugs can be added to the list. It is estimated that these changes will save Medicare nearly $32 billion per annum. (For reference, the United States spends $4.6 trillion on healthcare each year, with this aggregate total expected to double by the early 2030s.)  Of note: these provisions do not pertain to drugs on the commercial market.

• Paid Family & Medical Leave (PFML)/Paid Family Leave: 13 states and Washington, DC, either currently or will have a statutory PFML program: CA, NY, NJ, RI, WA, MA, CT, OR, CO, MD, DE, MI, ME, and DC (With the exception of DC and RI, all allow for a “private plan.”) Pennsylvania has a pending PFML bill in 2024, which includes a private option. Meanwhile, New Hampshire and Vermont have initiated “voluntary” Paid Family Leave state programs while Arkansas, Alabama, Kentucky, Florida, Tennessee, Texas, and Virginia permit insurers to sell a fully-insured Paid Family Leave product.

• Medicare Update: In a recent nationwide trend, many Americans on traditional Medicare plans have started gravitating toward Medicare Advantage plans. In fact, it was offered that 54 percent of the Medicare-eligible population is currently on a Medicare Advantage plan, with that rate set to balloon to 60 percent by decade’s end. Further, as part of next year’s Medicare rule changes, there is expected to be heightened access to behavioral health services and Part D covered drugs for enrollees. Effective this month, there is greater Part D plan flexibility to substitute biosimilars for reference drug products.

• Long-Term Disability Mental Health Parity: This past December the ERISA Advisory Council recommended that the National Association of Insurance Commissioners (NAIC) mandate that there be mental health parity for long-term disability (LTD) plans. Subsequent legislation is still pending.