Few employers contain specialty Rx costs: study
Drugmakers and insurers may be concerned about the going price of drugs, but a recent report by the Pharmacy Benefit Management Institute indicates that employers are not actively encouraging staff to pursue lower-cost options when it comes to specialty medications.
Walgreens Specialty Pharmacy, which sponsored the 2014 report, noted in the introduction that the survey of 337 US employers included some surprises, such as the tidbit that “just 7% of respondents reported modifying their benefit design to encourage use of lower-cost sites of care during the previous year.”
The institute also found that 33% of polled employers thought retail pharmacies were better at helping specialty medication patients tap into co-payment assistance programs and that only 39% thought their PBM tracked specialty drug spend.
Additional findings indicate a deeper dissonance between cost consciousness—a top-line concern for consumers and healthcare providers, according to a recent Manhattan Research report—and what it means to be cost-conscious when the term “specialty medication” comes into the mix, which, according to the PBMI report, includes an average cost of around $3,000 a month per patient, or around 30% of total drug expense. PBMI expects this cost will only rise, and projects that specialty medications will account for more than 50% of total drug costs within the next four or five years.
PMBI says employers have not completely ignored cost-limiting measures and that both small and large companies are increasingly leaning on strategies such as prior-authorization and step therapy to contain expenses. Data talliers found, for example, that 74% of smaller employers had step-therapy requirements in 2013 compared to 57% in 2012 and that both smaller and larger employers are likely to have separate cost-sharing requirements for specialty medications.
Unsurprisingly, employers are interested in adherence, and PBMI says that the majority of the surveyed employers —62%—were able to track adherence and persistency outcomes of their specialty medication patients (distinct from the 39% who did not think their PBM tracked specialty medication spend), a metric that is becoming of increasing importance with healthcare reform and the rise of accountable care organizations.
PBMI's survey also shows that the cost/benefit optic does not mean employers assume lookalike drugs are going to help pare back costs and notes that employers have an accurate view of the impact biosimilars may or may not have on their cost structure. Only 15% of surveyed employers said they expect biosimilars will lead to substantial savings, whereas 36% “project a marginal reduction in cost.”