In Brief: Health Exchange Plans Much Cheaper Than Other Coverage; State Gets $7.1M Settlement

Study: Health Exchange Plans Much Cheaper Than Other Coverage

A new study by the Sunnyvale-based survey firm HealthPocket has concluded that the health insurance coverage offered by health plans that are not competing in state exchanges is significantly more expensive than their offerings within exchanges.

HealthPocket studied the non-exchange offerings of UnitedHealthcare, Aetna, Cigna and Assurant in the most populous cities in the 39 states where they compete. Those plans all generally avoided selling coverage in the exchanges.

HealthPocket concluded that their offerings were more than 40% more expensive than coverage offered in the state or federal exchanges. The costs were based on the premiums charged a 40-year-old non-smoker. 

Bronze, silver and gold product offerings were included, but platinum was not because of its spotty availability. 

Bronze-level plans were 45% less expensive in the exchanges; silver-level plans were 39% less expensive; and gold-level plans were 41% less expensive. 

Although HealthPocket noted that a large number of people who purchased coverage in the exchanges qualified for income-based subsidies, they were not factored into the premiums studied.

HealthPocket suggested that the price comparison tools available on most of the exchanges prompted insurers to cut their prices. Its study also noted that “off-exchange insurance companies may have believed there would be lesser consumer awareness of these sites. Off-exchange insurers may also have spent more money than on-exchange insurers for marketing costs, which would be reflected in higher premium prices. Additionally, networks for some on-exchange plans may have been narrowed to achieve lower premium costs.”

Drugmaker Will Pay State $7.1 Million To Settle Civil Case

The state of California will receive nearly $7.1 million from pharmaceutical manufacturer Glaxo SmithKline as a settlement for unlawfully promoting its asthma and antidepressant drugs.

The sum is California's share of a $105 million settlement. 

The firm had been accused by attorneys general in 43 states and the District of Columbia of paying bonuses to its sales force to encourage doctors to find off-label uses for its drugs Advair, which treats asthma, and Paxil and Wellbutrin. 

Physicians are able to prescribe drugs for off-label use, but federal regulations bar promoting them for that purpose.

GSK also paid doctors to promote those drugs as well, and published apparently flimsy clinical studies that promoted their use for off-label purposes.

“Patient care is undermined when pharmaceutical companies promote uses for drugs that have not been approved by the FDA or pay medical professionals to promote certain drugs,” said California Attorney General Kamala Harris in announcing the settlement. “This settlement requires GSK to pay a significant penalty and imposes strong new rules designed to prevent future misrepresentations of GSK products.”