• Connecticut: Cigna has agreed to sell its Medicare businesses and CareAllies to Health Care Service Corporation (HCSC), an insurer with Blue Cross Blue Shield, in a deal worth $3.7 billion. Currently, Cigna's Medicare plans cover over 3.6 million people, including 2.5 million on Medicare Part D plans and 600,000 on Medicare Advantage (MA) plans. As part of the deal, HCSC agreed to use Cigna's Evernorth Health Services for pharmacy benefit services for four years. According to Cigna, the deal is expected to close in the first quarter of 2025. "The agreement will enable The Cigna Group to drive meaningful value for all our stakeholders, providing an enhanced ability to accelerate investment and growth in our services platform, while further deepening our commitment to our existing health benefits platform," said David Cordani, Cigna's CEO and chair. "In tandem, the transaction will position our Medicare businesses and CareAllies for additional growth as they continue to serve the needs of their customers as part of HCSC." (Herman, STAT, 1/31; Powel, USA Today, 1/31; The Cigna Group, PR Newswire, 1/31)
• Maryland: CMS recently issued proposed payment updates for the MA and Medicare Part D Prescription Drug Programs for calendar year (CY) 2025. In the proposal, CMS said it would increase payments to MA plans by an average of 3.7%, or over $16 billion, from 2024 to 2025. The agency also plans to change the structure of Medicare Part D drug benefits for CY 2025 to lower drug costs. Under the Inflation Reduction Act, annual out-of-pocket costs for people with Medicare Part D will be capped at $2,000. "CMS continues to ensure that Medicare Advantage and Part D prescription drug plans remain strong, stable, and affordable offerings," said CMS Administrator Chiquita Brooks-LaSure. "The Advance Notice upholds robust and stable options for people with Medicare while strengthening payment accuracy so that taxpayer dollars are appropriately spent." Comments on the proposal will be accepted through March 1, and CMS will publish the final rate announcement by April 1. (CMS press release, 1/31; AHA News, 1/31)
• Pennsylvania: Philips Respironics recently announced that it will halt sales of its breathing machines in the United States after reaching an agreement with FDA over continued problems with the products. In June 2021, Philips issued a recall for more than a dozen of its BiPAP, CPAP, and ventilator machines manufactured due to potential health risks from faulty components, including serious injury or exposure to cancer-causing chemicals. The initial recall affected around 15 million devices produced since 2006, and roughly 5 million were still in use by mid-2021. Under Philips' agreement with FDA, the company is required to meet a list of standards as part of a "multiyear" plan before it can resume business in the United States. According to Philips, more details about the agreement will be disclosed when it is finalized in court. In the meantime, the company said it will continue to repair existing devices and provide assistance to people who are still using them. (Jewett, New York Times, 1/29)

Vertical integration and consolidation are significantly altering the healthcare landscape. From health plans to retailers to incumbent health systems, consolidation is reshaping conventional norms in the industry. Radio Advisory's Rachel Woods sat down with  Advisory Board  experts Paul Trigonoplos and Eliza Dailey to discuss the reasons for and reactions to the recent explosion in consolidation across the industry and explore how different stakeholders are responding and where the future is heading for diversification and integration. Click below to read a lightly edited excerpt from the interview and download the episode for the full conversation.