5 ways to help manage specialty drug spending
Published June 23, 2015 8:28 AM
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Updated June 23, 2015 11:11 AM
1 Min Read
Prices are soaring for specialty drugs used to treat critical illnesses such as cancer, Hepatitis C and multiple sclerosis, as well as more common conditions like high cholesterol. Right now, employers are largely bearing the brunt of the cost, and health care experts and leading employer organizations like the Minnesota Health Action Group are looking for collaborative, sustainable, solutions to this challenging situation.
Call to action
The Action Group has formed a Specialty Pharmacy Learning Network that gives employer members the opportunity to: Learn from experts and each other; develop strategies to ensure their company and employees are protected from exorbitant specialty drug pricing; work collaboratively to shape the specialty drug market, rather than have it designed by others; and develop positions to influence state and federal policy makers. Here are some startling statistics and tips to help employers begin to manage specialty drug spend.
Unequal pricing
Prices for specialty drugs in the United States far exceed prices for the same drugs in other countries. The Hepatitis C drug, Sovaldi, made headlines last year when a course of treatment was pegged at $84,000 in the United States, crushing previous cost and use records. The same drug is priced at $900 in Egypt and $51,000 in France. New drugs to treat common conditions are also driving up costs. For example, U.S. costs for powerful new cholesterol management drugs called PCSK9s are expected to be $7,000-$12,000 per patient per year, compared with about $1,000 on average for conventional drug therapies.
Understanding the trend
In addition to looking for opportunities to join forces and collaborate for change with other employers, The Minnesota Health Action Group recommends employers start by understanding their current specialty pharmacy drug spend, including the 50% of spend that is administered by health plans as part of your medical benefit.
Communicate
To better manage and anticipate future drugs costs, ask your health plans and pharmacy vendors to project specific future costs given your company's population and drugs that are currently in the pipeline.
Evaluate
Evaluate your health plan and PBM benefit plan designs to make sure your plans aren't inadvertently driving employees to higher-cost sights of care, like outpatient hospital settings, for specialty drug treatments.
Negotiate
Remove any potential financial incentives for providers who administer high-cost drugs by requiring health plans to contract with them on a fixed-fee basis for drugs rather than a percentage of billed charges.
Strategize
Use strategies like evidence-based prior authorization and step therapy to ensure that anyone covered by your companys health plans and PBM receives the right drug treatments, at the right time, at the right price, and in the right places. A longer-term strategy is to advocate for value-based pricing for specialty drugs based on a quantifiable measure that is similar to what is done in other countries.
