Phillip went in for his semi-annual checkup for Crohn’s disease, which he’s lived with for years. Using a combination of diet strategies along with the drug prednisone, flare-ups have been under control. Phil’s doctor suggested he consider switching to a new drug called Humira®. The doctor explained that while Phil hasn’t had any problems with prednisone, this new drug has responded well with some of his other patients and could improve his condition long-term.
Louise, his spouse, went home and called the HR department, which explained that in some cases, specialty drugs can be billed through the pharmacy plan. In other cases, the medication is billed through the medical plan. The HR department wasn't sure which benefit design the drug would fall under so it referred Louise to her medical plan.
After speaking with the customer service department at her health insurer, Louise learned that Humira® was an injectable drug, which must be delivered in a freezer packed styrofoam box. The drug could be administered at home, or in some cases delivered to the doctor’s office or even the pharmacy, depending on how the claim is billed. The retail cost range could be anywhere from $850 to $1500 monthly, depending on the dosage and frequency. Louise and Phil would be required to pay their health deductible plus a coinsurance under medical benefits, or different amounts under their prescription plan. Louise and Phil reviewed the advantages of the new drug, but are worried about the additional costs and side effects. They are confused and not sure how they will decide, or where to turn.
I’ll admit that Phil and Louise are fictional characters, but this scenario is not. Health plan members, employers, and plan sponsors don’t have enough information.
The survey included responses from 291 employers and health plans, representing over 70 million lives. Only 19% of employers and 33% of health plans self-reported high knowledge of specialty drugs. Sadly, some plan sponsors don’t even have the ability to track these costs — less than 20% are provided reporting from PBMs or health care vendors on specialty utilization. This gap, along with over 50% of the drugs that are being billed on the medical claims side, suddenly leaves specialty drugs buried way down in the mix.
The first step is to ask your health plan vendor or PBM for comprehensive reporting. Inquire about the strategies in place to help contain costs. Most health plans use prior authorization for specialty drugs under the pharmacy benefit, but this authorization may be lacking on the medical claims side. Additionally, clinical care management programs, as well as increased cost sharing are popular cost-containment strategies. Cost sharing levels, though, need to be reviewed. They can vary from the pharmacy benefit design to the medical plan design, which can be even more confusing to patients. Different benefit cost-shares can have an adverse result on consumerism, as patients typically will choose the most cost-effective method to disperse the medications.
Request reporting and ask for solutions. Specialty drugs costs are not going away any time soon. Dive in and jump into the muddle-puddle because the more active we are as an industry, the more progress we’ll make towards cost-containment efforts down the road.
Karrie Andes, SPHR, CBP, is the senior benefits manager for
What strategies do you have in place to manage spending on specialty drugs? Share your thoughts in the comments.
