Specialty Drugs Remain a Costly Concern for Employers With No Easy Answers

Costs remain the top concern of healthcare purchasers of pharmacy benefits, but employers are also concerned with ensuring appropriate use of medication and adherence to medication, according to a new report from the Pharmacy Benefit Management Institute (PBMI).

The eighth Trends in Specialty Drug Benefits includes findings from a survey of 306 respondents responsible for managing the drug benefit for their organization.

Specialty drug spend currently accounts for half of the total drug spend, which creates challenges for employers who want to ensure employees have access to medications. However, with costs rising, employers are also interested in evidence that these medications provide value, which can be gained through new reimbursement arrangements.

Outcomes-based contracts provide the ability to track patient outcomes, with 67% of respondents using these arrangements to track total healthcare cost of patients receiving specialty drugs, 63% tracking adherence and persistency, and 27% tracking clinical efficacy. Less than 10% are tracking the impact of medications on employee productivity.

“Timely, accurate, and actionable reporting is key to measuring how a plan is doing in terms of specialty drug benefit management,” according to the report. “When done well, reporting can highlight areas of opportunity to improve clinical and financial outcomes.”

While nearly all (94%) of respondents said their pharmacy benefit manager (PBM)/healthcare vendor tracks specialty and nonspecialty drug spend under the pharmacy benefit, only half said they are tracked under the medical benefit.

Of respondents whose PBM/healthcare vendor tracks specialty drug spend, 63% of respondents said they can effectively track adherence and persistency, but 34% said they cannot and would like that ability. Furthermore, only 27% can track clinical efficacy and 66% said they cannot and would like the ability.

Respondents were asked an open-ended question of what other outcomes they were interested in tracking, and responses included adverse events and side effects, impact of high-deductible plans and coinsurance on outcomes, long-term cost avoidance by drug, and clinical alternatives and cost impact.

The survey found that respondents are less interested in using formulary exclusions to manage the specialty trend. In the 2018 report, the number of respondents who think exclusions are effective declined 21%. However, this belief does not mean formulary exclusions are going anywhere. Sixty percent of respondents said they use formulary exclusions and 33% are considering adding or increasing their use.

Close to half (42%) of respondents said member dissatisfaction was the number 1 challenge with formulary exclusions, while 27% named it the number 2 challenge.

“Plan sponsors continue to use the traditional drug management levers of utilization management, clinical programs, formulary, and cost-sharing, but remain open and willing to be part of conversations that explore new ways to rein in specialty costs while providing a quality and affordable specialty drug benefit,” according to the report.