1 big thing: Medicare Advantage debate rekindled by watchdog report

2. Praise for FDA's proposed menthol ban

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3. Watch out for a blockbuster obesity drug

4. Tackling the multiple sclerosis mystery

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5. Dog of the week

Good morning. Happy Friday. It's Caitlin Owens filling in for today.

Today's word count is 794, or a 3-minute read.

Plus, support for a menthol cigarette ban

Axios Vitals: Medicare Advantage under fire

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1 big thing: Partisanship undermines pandemic playbook

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2. Children's health issues getting worse

3. "Family glitch" fix on the horizon

4. As masks lift, spirits rise

5. Catch up quick

Today's word count is 987, or a 4-minute read.

Plus, we may not be learning our pandemic lessons.

1 big thing: Americans' COVID culture war

2. America's giant medical debt

3. Out-of-pocket limits aren't silver bullets

4. Having a baby isn't cheap

5. How COVID can damage the brain

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6. Dog (news) of the week

🎧 Listen: The second episode of "How It Happened: Putin's Invasion" came out this morning and features Axios world editor David Lawler, politics managing editor Margaret Talev and climate and energy reporter Andrew Freedman breaking down the consequences of the war in Ukraine.

Today's word count is 1,039, or a 4-minute read.

1 big thing: America's other public health threat

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2. Another European warning

3. A potential case of telehealth gone wrong

4. Opioid overdose rate's racial reversal 

5. While you were weekending

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Today's word count is 790, or a 3-minute read.

1 big thing: Pharmacists push for enhanced role in post-pandemic life

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2. COVID cases continue to plummet

3. New COVID funding in legislative trouble

4. Border dispute may threaten plasma supply

Today's word count is 890, or a 3-minute read.

The prospect of an effective new Alzheimer's treatment came roaring back this week with the announcement of preliminary clinical trial data, giving millions of seniors renewed hope after a tumultuous year. 

Why it matters: Alzheimer's is a devastating disease, and the topline results boosted analysts' expectations for an entire class of drugs targeting the condition. But they also resurrect enormous questions about who'll cover the costs and how the U.S. will oversee what's likely a multi-billion dollar market.

 Driving the news: The success of Eisai and Biogen's clinical trial of lecanemab, reported Tuesday night, has instantly changed the narrative around arresting Alzheimer's progression.

Drugmakers have spent billions of dollars developing products built around the theory that brain amyloid plaques are major contributors to Alzheimer's and that reducing those plaques will fight the disease.

But the expectations for those drugs were dashed by the drawn-out saga of Biogen's other Alzheimer's drug, Aduhelm, which was approved by the FDA last year without solid evidence it worked. 

Medicare administrators this spring placed coverage limits on any treatments that target amyloid plaques but haven’t shown a clear benefit, meaning Aduhelm was largely excluded from the program.

State of play: The lecanemab news ironically came the same day that the Biden administration announced lower Medicare premiums in 2023, a product of Aduhelm's coverage limitations.

The trial results — announced by press release — will likely restart the entire regulatory mechanism, this time for a drug that experts say has gone through a much more reliable scientific process.

"So far, what we know about lecanemab are data that come from what I call normal science, whereas the data we had from [Aduhelm] came from abnormal science, and that’s a big difference," said Jason Karlawish, a medical professor at the University of Pennsylvania.

Eli Lilly, Roche and Acumen Pharmaceuticals also have drugs in development that target amyloid plaques, and the Biogen results have raised many investors' expectations for their success.

The other side: Some in the research community continue to question the focus on anti-amyloid cures and say success fighting Alzheimer's will come in combination therapies like those used for heart disease, cancer and hypertension. 

"Amyloid-clearing drugs will provide an incremental benefit at best and there is still a pressing need for the next generation of drugs focused on other targets based on our knowledge of the biology of aging," said Howard Fillit, co-founder and chief science officer of the Alzheimer's Drug Discovery Foundation. 

Between the lines: Aduhelm's approval created the possibility of a nightmare spending scenario after it was initially priced at $56,000 a year and approved for all Alzheimer's patients.

Even with significantly lower prices and a narrower eligibility criteria, a new Alzheimer's drug would almost certainly cost the U.S. health system billions every year. 

Eisai has said that lecanemab's "annual value-based price" could be between $9,249 and $35,605.

What they're saying: If the FDA approves lecanemab, the Centers for Medicare and Medicaid Services will once again be in the position of determining if and how to cover it. 

"If the data is what the companies say it is, we believe it will be hard for CMS to refuse coverage," said Raymond James analyst Chris Meekins, who estimates the earliest Medicare could start reimbursing for the drug is late in the third quarter of 2023. 

"FDA approval seems likely, but CMS determination [is] another bridge to cross," Wedbush's Laura Chico told investors Wednesday morning per MarketWatch. "It's a positive to see the study reach statistical significance, with FDA previously signaling this would be a prerequisite for approval. However, what CMS will see as a clinically meaningful outcome remains to be determined."

What we're watching: Full details of the trial will be presented at a scientific conference on Nov. 29. Although the drug is currently on track to undergo accelerated approval by the FDA, the data could justify traditional approval, analysts said.

The bottom line: "If what they report is all proper and true and valid ... and holds up to scrutiny, we have an effective treatment for Alzheimer's disease," Karlawish said.

Another prospect for an Alzheimer's drug renews cost concerns

But positive clinical trial results also renew the hopes of millions of seniors.

Alzheimer's disease

Health care costs

The prospect of an effective new Alzheimer&#x27;s treatment came roaring back this week with the announcement of preliminary clinical trial data, giving millions of seniors renewed hope after a tumultuous year. Why it matters: Alzheimer&#x27;s is a devastating disease, and the topline results boosted analysts&#x27; expectations for an entire class of drugs targeting the condition. But they also resurrect enormous questions about who&#x27;ll cover the costs and how the U.S. will oversee what&#x27;s likely a multi-billion dollar market.

The U.S. faces a range of health care flashpoints — unaffordable drugs, opioids, vaping — as we debate whether to adopt universal care. For now, the Affordable Care Act is the law of the land, but Republicans want to issue it a final death blow.

Health

A Supreme Court case that takes up Medicaid recipients’ ability to sue providers is providing a new battleground over patients’ rights and could potentially open the door to erosion of the program's benefits.

Why it matters: The outcome could decide if tens of millions of people in public welfare programs can go to court if essentials like health care and food are endangered, experts say. That option is generally more efficient than waiting for the federal government to intervene.

Catch up quick: Justices last May agreed to review the case, Health and Hospital Corp. v. Talevski, which was brought by the wife of a Medicaid patient with dementia who sued his nursing home, alleging abuse and violations of his rights.

The nursing home successfully argued in a lower court that federal rules for Medicare and Medicaid recipients originate from the government's spending powers and amount to contracts between the government and providers. By that reasoning, individuals can't sue for the entitlements the program promises, per Reuters.

But the 7th U.S. Circuit Court of Appeals last year reversed the decision, finding precedent for a right to sue, including situations in which hospitals took states to court over Medicaid reimbursement rates. 

A ruling limiting or overturning the right to go to court could extend beyond Medicaid, to CHIP, the Supplemental Nutrition Assistance Program, Head Start and other programs, congressional Democratic leaders wrote in a brief filed Monday. 

The big picture: Conservative judges and lawyers have long argued that health providers or individuals shouldn't be able to sue over Medicaid coverage decisions.

Arguments in the Medicaid case, set for Nov. 8, will come at a volatile time, after the conservative supermajority struck a federal right to abortion and touched off a fierce national debate about equity, both in the health system and in the courts, experts say.

"The Supreme Court has put the nation at a crossroads where access to abortion and reproductive rights are concerned. Now, it appears, we are also at a turning point on equal justice, looking at a time when state officials will be able to simply suspend Medicaid enrollment or deny covered treatments without having to face the prospects of a court injunction," health law professors Sara Rosenbaum and Timothy Jost wrote earlier this year in Health Affairs.  

What they're saying: "Eliminating Congress's right to establish these private enforcement mechanisms will leave federal-state programs with limited oversight. And individual violators will be effectively immunized from suit," the Democratic lawmakers wrote in their amicus brief.

The other side: Indiana is leading 22 states in arguing the court should block private citizens from using the courts to enforce contractual conditions that stem from federal spending laws.

"Permitting private actions to enforce federal conditions based on implied rights erodes that foundational limitation on Congress's Spending Clause power," the states wrote. 

SCOTUS' latest health care tempest

The outcome could decide if people in public programs can go to court if essentials like health care are endangered.

Illustration of a caduceus with a gavel in the center. 

Medicaid

A Supreme Court case that takes up Medicaid recipients’ ability to sue providers is providing a new battleground over patients’ rights and could potentially open the door to erosion of the program&#x27;s benefits.Why it matters: The outcome could decide if tens of millions of people in public welfare programs can go to court if essentials like health care and food are endangered, <a class="gtmContentClick" data-vars-link-text="experts say" data-vars-click-url="https://www.healthaffairs.org/do/10.1377/forefront.20220518.925566/" data-vars-content-id="7577da67-b71e-496b-8d36-519ecd37c0d6" data-vars-headline="SCOTUS&#x27; latest health care tempest" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.healthaffairs.org/do/10.1377/forefront.20220518.925566/" target="_blank">experts say</a>. That option is generally more efficient than waiting for the federal government to intervene.

The era of multimillion-dollar gene therapies has arrived, providing a ray of hope to patients with debilitating diseases — but also presenting huge affordability challenges.

Why it matters: Though the expected number of patients who'll likely receive the treatments is relatively low, it's unclear how small employers, state Medicaid programs, and the rest of the health system will absorb such large costs all at once. 

Driving the news: The FDA recently approved two gene therapies, doubling the number on the market for diseases other than cancer.

Bluebird bio's Zynteglo is for a blood disorder called beta-thalassemia that's customarily treated in the most severe cases through regular transfusions. Zynteglo is marketed as a one-time, custom-designed injection that takes aim at the underlying genetic causes of the disorder, and costs $2.8 million.

Zynteglo was the most expensive drug on the market for a few weeks, until the FDA approved bluebird's Skysona for a rare neurological disorder called cerebral adrenoleukodystrophy. Skysona had a list price of $3 million. 

Bluebird estimates there are 1,300–1,500 people in the U.S. who are eligible for Zynteglo. CVS estimates there are only 700 potential U.S. candidates for Skysona.

Where it stands: The two previously-approved non-oncological gene therapies came to market with price tags of $850,000 and $2.1 million. 

CAR-Ts, or gene therapies that treat cancer, have their own affordability issues.

The average gene therapy is likely to cost at least $1.5 million, said Colin Young, director of drug development pipeline research at Tufts Medical Center's NEWDIGS Initiative.

Including oncology drugs, gene therapies could end up costing the U.S. around $30 billion a year, Young said. Total U.S. prescription drug spending was $348.4 billion in 2020, according to CMS.

"On a macro scale, it's not a big problem," Young said. "On a micro scale, it's still quite a problem, because if you're a self-insured company and somebody suddenly requires a $3 million gene therapy, that could wipe out the money you have for the rest of your employees."

The big picture: Even though just a handful have been approved, the drug development pipeline is full of gene therapies, and the FDA has estimated that it could be approving between 10 and 20 annually by 2025. 

Even experts and groups generally critical of high drug prices say the cost could be justified if it delivers a lifelong cure that saves the health care system a lot of money in the long run.

When the modern health system came into existence, "there wasn't an expectation at the time for potentially durable, potentially curable class of therapeutics like gene therapies," said David Barrett, CEO of the American Society of Gene and Cell Therapy. 

"That's creating some issues trying to fit a transformative class of therapeutics into a system that was designed to address almost a more transactional approach with prescription drugs, where the benefit is tied to the administration of the therapy."

What they're saying: "As much as these are challenges in terms of paying for them ... unlike other drugs, you can understand the cost a little bit better here," said Sergio Santiviago, vice president of drug policy at America's Health Insurance Plans, which is generally critical of drug prices.

Between the lines: Payers and pharmaceutical companies are both open to nontraditional payment models to cover the risk if the treatments don't work. 

Bluebird is offering to refund up to 80% of Zynteglo's cost for two years if patients still need blood transfusions, per BioPharma Dive. Another popular idea is to pay for the therapies over time, like a mortgage. 

But "our health care system is highly fragmented, and that mean people churn on and off of insurance, and have different forms of insurance during different times of their lives," said Rachel Sachs, a law professor at Washington University.

She noted payers may not have an incentive to provide access to a therapy that requires a one-time remittance but provides benefits over years or a lifetime, "because they're not the ones benefiting."

There are other legal and practical barriers that vary by insurance market. 

State Medicaid programs will likely have to be careful about which patients they make eligible for the drugs, Santiviago said, because "if some states have a concentration of these folks, it could destroy their budget within a year."

The intrigue: Because gene therapies are so new, the world is only in the preliminary stages of collecting data on their durability. 

If their effectiveness fades or disappears over time, then they're not as valuable and the high price tags aren't as justified. 

And not all gene therapies are the same. Some use technology that is more likely to permanently cure a patient than others, Young said.

Questions about durability can pose regulatory challenges for the FDA, and it already has a history of asking manufacturers to gather more data before the agency approves a product.

What we're watching: The approved gene therapies to date are for very small patient populations. But two treatments for sickle cell disease could come onto the market as soon as next year. 

There are an estimated 58,000 potential U.S. patient candidates, according to CVS. A huge portion of these are insured through Medicaid, since the disease often keeps people from working.

One study published last year in JAMA Pediatrics found that if a $1.85 million sickle cell gene therapy was administered to only 7% of eligible patients annually, the average one-year budget impact per state Medicaid program included in the study would be nearly $30 million.

The bottom line: The question of how to handle an influx of gene therapies has gone from abstract to imminent. 

"There's 2,000 gene therapies in the pipeline in the foreseeable future, and it has the potential to change the way we treat disease," Barrett said. 

"It would be unacceptable to me that scientists, physicians and the patients who volunteer to be part of these clinical trials, that their effort would be wasted if payers and policymakers couldn't find a way to cover and adequately reimburse for these transformative treatments."

Multimillion-dollar gene therapies offer hope and huge cost concerns

The average gene therapy is likely to be at least $1.5 million.

Illustration of a double helix made out of a $100 bill.

Gene therapy

The era of multimillion-dollar gene therapies has arrived, providing a ray of hope to patients with debilitating diseases — but also presenting huge affordability challenges.Why it matters: Though the expected number of patients who&#x27;ll likely receive the treatments is relatively low, it&#x27;s unclear how small employers, state Medicaid programs, and the rest of the health system will absorb such large costs all at once.

All signs are pointing toward significantly higher health costs in the employer market next year, which will translate into larger-than-normal premium increases.

Why it matters: Employers will have to choose between taking the hit or passing the added cost to their employees — a decision that's particularly difficult in a tight labor market.

Driving the news: Seven in 10 employers expect moderate to significant increases in the cost of health benefits over the next three years, according to a recent Willis Towers Watson survey.

"There’s this terrible reality that they're trying to increase affordability at the same time the actual total cost is going up more than they expected," said WTW's Jeff Levin-Scherz.

More than half of survey respondents said they plan to address rising costs by using programs or vendors that would reduce total spending. Less than a quarter said they will shift costs onto employees through higher premium contributions, and 14% said they'll shift costs through out-of-pocket expenses. 

But employees may not tolerate premium hikes in the current labor climate. Hundreds of New Jersey public employees rallied last week to demand that a vote on a more than 20% premium increase next year be delayed, Bloomberg reported.

Between the lines: Part of the reason why health costs haven't risen in tandem with general inflation this year is because payers have pricing contracts — often multi-year — with providers, drug manufacturers and medical device makers.

That means that underlying inflation in labor or production costs isn't immediately shifted into payment rates or, subsequently, premiums. 

Hospital groups have been telling anyone who will listen how much their costs have gone up in the past couple of years. It stands to reason that those complaints loom large in negotiations with insurers.

"There are signs everywhere that hospital price increases are coming, and that’s going to push insurance premiums for employer-provided health benefits higher next year," said Kaiser Family Foundation's Larry Levitt. "The health care sector has been somewhat insulated from the inflation that’s been hitting the rest of the economy, but probably not for much longer."

Given the structure of contracts, these rate increases may be spread out over several years.

The big picture: Employers have overwhelmingly responded to rising health prices for more than a decade by offering plans with higher deductibles and out-of-pocket spending. 

That means that health insurance has gotten more expensive even for Americans who get their coverage through work. 

But there have been signs that employers have maxed out their ability to shift costs to workers as more and more insured Americans struggle to afford care. 

Now, employers are struggling to attract and retain workers, meaning they are likely even more averse to reducing the value of the health benefits they offer. 

What we're watching: Whether employer premium hikes will be politically weaponized heading into the midterm elections. 

There are signs that the GOP may try to connect them with overall inflation, which the party sees as a winning attack against Democrats. 

"Prices are sky high for food, shelter, and even health insurance, yet over the last month, the Biden administration ... even provided generous subsidies to the wealthy for things ranging from electric vehicles to Obamacare," House Ways and Means ranking Republican Kevin Brady of Texas said recently. 

Yes, but: Workplace coverage hikes may not be as easy to tie to Democrats as rising Affordable Care Act costs would have, had Congress not extended enhanced subsidies.

"The ACA is the signature domestic policy achievement for Democrats from the last decade, so Republicans would have pointed to big premium increases as a failure of Obamacare," Levitt said. "Neither Democrats nor Republicans have moved in any serious way to improve affordability for people with employer health benefits."

Employers' coming health care crunch

Premiums are expected to rise, and employers will have to decide whether to shift those costs to workers.

Illustration of a briefcase being broken by an oversized medical red cross symbol

Employer coverage

All signs are pointing toward significantly higher health costs in the employer market next year, which will translate into larger-than-normal premium increases.Why it matters: Employers will have to choose between taking the hit or passing the added cost to their employees — a decision that&#x27;s particularly difficult in a tight labor market.

Sen. Lindsey Graham's 15-week abortion ban appears to be a political gift to Democrats less than two months before the midterm elections, but it syncs with nearly half of Americans' views on when the procedure should be legal.

The big picture: Elections aren't won on nuance, and most nationally-elected Republicans have gone silent on the subject in the final stretch of the campaign. In the long run, however, abortion politics will likely pivot around which party can most successfully brand the other side as extreme. 

Driving the news: Graham on Tuesday introduced a federal ban on abortion after 15 weeks of pregnancy that would allow for exemptions in cases of rape or if the mother's life is in danger. 

On the House side, Rep. Chris Smith (R-N.J.) has a companion bill that's drawn more than 80 co-sponsors.

Neither has a chance of passing in a Democratic-controlled Congress. But Graham said a 15-week ban "would put us in line with the science in the civilized world," adding, "If we take back the House and the Senate, I can assure you we'll have a vote on our bill."

State of play: Republicans are desperate to stop talking about whether rape victims or cancer patients should be able to get abortions, and are well aware that the Supreme Court's decision to overrule the federal right to abortion is not playing well for them heading into the midterms. 

If you squint your eyes, Graham's bill can be read as a more moderate alternative to the blanket bans currently in effect in red states across the country, though it would allow those state laws to stand.

It's certainly a contrast to what Democrats have proposed — a prohibition on states banning abortion before viability — which Graham said the bill is a response to. 

"Should we look like Iran and North Korea when it comes to national abortion policy or maybe France, Belgium, Spain, Denmark and Norway?" he said, noting the 15-week criteria is in line with those in Europe and other developed nations. "If you vote with the Democrats, we'll look more like Syria and North Korea and Iran."

Yes, but: If Graham's intent was to cast a 15-week federal ban as a moderate abortion policy, the rollout didn't go quite as planned. Democrats quickly blasted out statements condemning the legislation and many prominent Republicans distanced themselves from it. 

"Extreme MAGA Republicans are gleefully charging ahead with their deadly crusade to punish and control women’s health decisions," House Speaker Nancy Pelosi said in a statement.

Senate Minority Leader Mitch McConnell told reporters on Tuesday that most Senate Republicans believe abortion access should be kept "at the state level," while Majority Leader Chuck Schumer said on the Senate floor that "Republicans are twisting themselves into pretzels trying to explain why they want nationwide abortion bans when they said they'd leave it up to the states."

Brendan Buck, a long-time aide to former House Speaker Paul Ryan, called Graham "unbelievably selfish," accusing him of "trying to score points with the culture war crowd at the expense of possibly blowing the Senate. Must love the minority."

By the numbers: Public support for the right to abortion drops off the later the procedure is performed in a pregnancy. 

Two-thirds of Americans think abortions should be legal in all or most cases in the first trimester, according to AP-NORC polling from July. Support falls to 42% in the second trimester and to 24% in the third trimester.

When asked specifically whether states should allow pregnant people to obtain an abortion 15 weeks into the pregnancy, 53% said yes.

"The fight now is for people who don't want to ban all abortions but aren't comfortable with late-term abortion," a former chief of staff to an anti-abortion Republican member told Axios. Graham "is trying to define late term as 15 weeks."

Between the lines: The legislation serves as a reminder of how fast the abortion landscape has shifted.

Graham last year introduced a 20-week nationwide abortion limit that had 45 Republican cosponsors, including McConnell. Contrast that to now: Republicans in red states have enacted full bans with few exceptions, making a 15-week limit look like a compromise.

Anti-abortion groups initially urged lawmakers to introduce a more sweeping federal ban, but momentum for such a bill has waned, and widely it's viewed as politically unpalatable.

What we're watching: If Republicans take control of either chamber of Congress next year, they will undoubtedly have to vote on some kind of abortion ban or restriction. The question is whether Graham is putting out a realistic marker.

Republicans' rocky attempt to change the abortion narrative

Illustration of the GOP logo with animated typing ellipses, as if the elephant is thinking.

Abortion

Sen. Lindsey Graham&#x27;s 15-week abortion ban appears to be a political gift to Democrats less than two months before the midterm elections, but it syncs with nearly half of Americans&#x27; views on when the procedure should be legal.The big picture: Elections aren&#x27;t won on nuance, and most nationally-elected Republicans have gone silent on the subject in the final stretch of the campaign. In the long run, however, abortion politics will likely pivot around which party can most successfully brand the other side as extreme.

President Biden has made the COVID-19 crisis and a post-Trump return to national unity and traditional democratic ideals his top priorities. From vaccinations to stimulus to schools, Biden is seeking bipartisan compromise while showing a willingness to use executive authority and bare Democratic majorities in the U.S. House and Senate to implement his policies. Republican leaders are navigating deep party divisions over if and how to move beyond former President Trump.

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Stories

Another prospect for an Alzheimer's drug renews cost concerns

SCOTUS' latest health care tempest

Multimillion-dollar gene therapies offer hope and huge cost concerns

Employers' coming health care crunch

Republicans' rocky attempt to change the abortion narrative

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Axios Vitals: Medicare Advantage under fire

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Axios Vitals: Massive medical debt

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