Patient and Plan Spending after State Specialty-Drug Out-of-Pocket Spending Caps.

BACKGROUND: Specialty drugs are used to treat complex or life-threatening conditions, often at high financial costs to both patients and health plans. Three states - Delaware, Louisiana, and Maryland - passed legislation to cap out-of-pocket payments for specialty drugs at $150 per prescription. A concern is that these caps could shift costs to health plans, increasing insurance premiums. Estimates of the effect of the caps on patient and health-plan spending could inform future policies. METHODS: We analyzed a sample that included 27,161 persons under 65 years of age who had rheumatoid arthritis, multiple sclerosis, hepatitis C, psoriasis, psoriatic arthritis, Crohn's disease, or ulcerative colitis and who were in commercial health plans from 2011 through 2016 that were administered by three large nationwide insurers. The primary outcome was the change in out-of-pocket spending among specialty-drug users who were in the 95th percentile for spending on specialty drugs. Other outcomes were changes in mean out-of-pocket and health-plan spending for specialty drugs, nonspecialty drugs, and nondrug health care and utilization of specialty drugs. We compared outcomes in the three states that enacted caps with neighboring control states that did not, 3 years before and up to 3 years after enactment of the spending cap. RESULTS: Caps were associated with an adjusted change in out-of-pocket costs of -$351 (95% confidence interval, -554 to -148) per specialty-drug user per month, representing a 32% reduction in spending, among users in the 95th percentile of spending on specialty drugs. This finding was supported by multiple sensitivity analyses. Caps were not associated with changes in other outcomes. CONCLUSIONS: Caps for spending on specialty drugs were associated with substantial reductions in spending on specialty drugs among patients with the highest out-of-pocket costs, without detectable increases in health-plan spending, a proxy for future insurance premiums. (Funded by the Robert Wood Johnson Foundation Health Data for Action Program.).

Price Is Right: Exploring Prescription Drug Coverage Barriers for Irritable Bowel Syndrome Using Threshold Pricing Analysis.

BACKGROUND: Prescription drug costs exert profound effects on commercial insurance coverage and access to effective therapy. AIMS: We aimed to assess threshold pricing to achieve budget neutrality of FDA-approved drugs treating irritable bowel syndrome from an insurance perspective, based on cost-savings resulting in decreased healthcare utilization through effective disease management. METHODS: We constructed a decision-analytic model from an insurance perspective to assess the budget impact of IBS prescription drugs under usual insurance coverage levels in practice: (1) unrestricted drug access or (2) step therapy in a primary care population of middle-age, care-seeking IBS patients. Budget-neutral drug prices were then calculated which resulted in $0 budget impact to insurers with a short-term, one-year time horizon. RESULTS: If used according to FDA labeling, IBS-D drugs cost between $4778 and $16,844 per year and IBS-C drugs cost between $4319 and $4955 per year. These drug costs often exceed insurance expenditures of $6999 for IBS-D and $3929 for IBS-C if left untreated. Therefore, for drugs to have $0 budget impact to insurers, their prices would need to be discounted 36.7-74.2% for IBS-D drugs and 59.3-82.5% for IBS-C. IBS drugs are already priced to support step therapy "failing one of several common, inexpensive IBS treatments with a responder rate > 30-40%," reflecting the subpopulation with more severe disease and greater healthcare costs. CONCLUSIONS: Broader prescription drug coverage for patients failing common, inexpensive IBS treatments to which at least 30-40% of patients would typically respond appears warranted to enable gastroenterologists to offer personalized approaches targeting specific mechanisms of this heterogeneous disease.

Economic Evaluation of Extending Medicare Immunosuppressive Drug Coverage for Kidney Transplant Recipients in the Current Era.

BACKGROUND: Kidney transplant recipients must take immunosuppressant drugs to prevent rejection and maintain transplant function. Medicare coverage of immunosuppressant drugs for kidney transplant recipients ceases 36 months after transplantation, potentially increasing the risk of transplant failure. A contemporary economic analysis of extending Medicare coverage for the duration of transplant survival using current costs of immunosuppressant medications in the era of generic equivalents may inform immunosuppressant drug policy. METHODS: A Markov model was used to determine the incremental cost and effectiveness of extending Medicare coverage for immunosuppressive drugs over the duration of transplant survival, compared with the current policy of 36-month coverage, from the perspective of the Medicare payer. The expected improvement in transplant survival by extending immunosuppressive drug coverage was estimated from a cohort of privately insured transplant recipients who receive lifelong immunosuppressant drug coverage compared with a cohort of Medicare-insured transplant recipients, using multivariable survival analysis. RESULTS: Extension of immunosuppression Medicare coverage for kidney transplant recipients led to lower costs of -$3077 and 0.37 additional quality-adjusted life years (QALYs) per patient. When the improvement in transplant survival associated with extending immunosuppressant coverage was reduced to 50% of that observed in privately insured patients, the strategy of extending drug coverage had an incremental cost-utility ratio of $51,694 per QALY gained. In a threshold analysis, the extension of immunosuppression coverage was cost-effective at a willingness-to-pay threshold of $100,000, $50,000, and $0 per QALY if it results in a decrease in risk of transplant failure of 5.5%, 7.8%, and 13.3%, respectively. CONCLUSIONS: Extending immunosuppressive drug coverage under Medicare from the current 36 months to the duration of transplant survival will result in better patient outcomes and cost-savings, and remains cost-effective if only a fraction of anticipated benefit is realized.

Trends and Factors Associated With Insurer Approval of Proprotein Convertase Subtilisin/Kexin Type 9 Inhibitor Prescriptions.

OBJECTIVES: Proprotein convertase subtilisin/kexin type 9 inhibitors (PCSK9is)-innovative yet costly cholesterol-lowering agents-have been subject to substantial prior authorization (PA) requirements and low approval rates. We aimed to investigate trends in insurer approval and reasons for rejection for PCSK9i prescriptions as well as associations between patients' demographic, clinical, pharmacy, payer, and PCSK9i-specific plan/coverage factors and approval. METHODS: We examined trends in PCSK9i approval rates and reasons for rejection using medical and prescription claims from 2015 to 2017 for individuals who received a PCSK9i prescription. We used multinomial logistic regression to estimate quarterly risk-adjusted approval rates for initial PCSK9i prescriptions and approval for any PCSK9i prescription within 30, 90, and 180 days of the initial PCSK9i prescription. For a 2016 subsample for whom we had PCSK9i-specific plan policy data, we examined factors associated with approval including PCSK9i-specific plan formulary coverage, step therapy requirements, and number of PA criteria. RESULTS: The main sample included 12 309 patients (mean age 64.8 years [SD = 10.8], 52.1% female, 51.5% receiving Medicare) and was similar in characteristics to the 2016 subsample (n = 6091). Approval rates varied across quarters but remained low (initial prescription, 13%-23%; within 90 days, 28%-44%). Over time, rejections owing to a lack of formulary coverage decreased and rejections owing to PA requirements increased. Lack of formulary coverage and having ≥11 PA criteria in the plan policy were associated with lower odds of PCSK9i prescription approval. CONCLUSIONS: These findings confirm ongoing PCSK9i access issues and offer a baseline for comparison in future studies examining the impact of recent efforts to improve PCSK9i access.

A Survey of American Psychiatrists Concerning Medication Prior Authorization Requirements.

This study examined opinions of American psychiatrists regarding prior authorization (PA) requirements for third-party payer coverage of medications and quantified perceived impact of these requirements on clinical practice. One thousand selected psychiatrist members of the American Psychiatric Association were invited to participate in a survey. Response rate was 33.1%. Respondents predominantly believed the obligation to obtain PA reduces job satisfaction and negatively impacts patient care. A total of 59.9% of respondents reported employing either diagnosis modification or falsification of previous medication trials at least occasionally in order to obtain PA. A total of 66.6% refrained at least occasionally from prescribing preferred medications due to PA requirement or expectation of one. On multivariate analysis, risk factors for refraining at higher frequency included seeing 300 or more patients in the previous 3 months, engaging more frequently in diagnosis modification, and reporting increased perception that obtaining PA reduces time for patient care.

Prescription medication cost, insurance coverage, and cost-related nonadherence among people with spinal cord injury in Canada.

STUDY DESIGN: Observational cross-sectional study. OBJECTIVES: To describe the most common prescription medications used and the extent of out-of-pocket cost, insurance coverage, and cost-related nonadherence (CRNA) for those medications by people with spinal cord injury (SCI) in Canada. SETTING: Community in Canada. METHODS: It was an observational study wherein data were collected through a cross-sectional online survey from individuals living with an SCI in Canada. We used descriptive statistics to describe the extent of drug cost, insurance coverage and CRNA among study sample, and analytical statistics to find association of CRNA with sociodemographic, injury-related and medication-related characteristics of the sample. RESULTS: Individuals with an SCI (n = 160) used an average of five medications and spent a median of $49 (interquartile range: $234.75) per month on their medications. More than 90% of participants had some form of drug insurance, though 37% reported CRNA. The most common medications that were forgone due to cost included opioids, antidepressants, and drugs for genitourinary and muscular spasms. Individuals with paraplegia and nontraumatic SCI had higher drug costs, though injury-related characteristics did not influence CRNA. Sex, monthly drug expenditure, and monthly additional healthcare costs were significantly associated with CRNA. CONCLUSIONS: People with SCIs are at risk of experiencing CRNA to their prescription medications despite having insurance coverage. Decision makers for the national pharmacare in Canada should account for their concerns judiciously.

Policy Recommendations for Pharmacy Benefit Managers to Stem the Escalating Costs of Prescription Drugs: A Position Paper From the American College of Physicians.

Recent discussions about the increasing prices of prescription drugs have focused on pharmacy benefit managers (PBMs), third-party intermediaries for various types of employers and government purchasers who negotiate drug prices in health plans and thus play a crucial role in determining the amount millions of Americans pay for medications. In this position paper, the American College of Physicians expands on its position paper from 2016 by offering additional recommendations to improve transparency in the PBM industry and highlighting the need for reliable, timely, and relevant information on prescription drug pricing for physicians and patients.

Impact of brand drug discount cards on private insurer, government and patient expenditures.

BACKGROUND: Brand discount cards have become a popular way for patients to reduce out-of-pocket spending on drugs; however, controversy exists over their potential to increase insurers' costs. We estimated the impact of brand discount cards on Canadian drug expenditures. METHODS: Using national claims-level pharmacy adjudication data, we performed a retrospective comparison of prescriptions filled using a brand discount card matched to equivalent generic prescriptions between September 2014 and September 2017. We investigated the impact on expenditures for 3 groups of prescriptions: those paid only through private insurance, those paid only through public insurance and those paid only out of pocket. RESULTS: We studied 2.82 million prescriptions for 89 different medications for which brand discount cards were used. Use of discount cards resulted in 46% higher private insurance expenditures than comparable generic prescriptions (+$23.09 per prescription, 95% confidence interval [CI] $22.97 to $23.21). Public insurance expenditures were only slightly higher with cards: an increase of 1.3% or $0.37 per prescription (95% CI $0.33 to $0.41). Finally, out-of-pocket transactions using a card resulted in mean patient savings of 7% or $3.49 per prescription (95% CI -$3.55 to -$3.43). The impact varied widely among medicines across all 3 analyses. INTERPRETATION: The use of brand discount cards increased costs to private insurers, had little impact on public insurers and resulted in mixed impacts for patients. These effects likely resulted from private insurers reimbursing brand drug prices even when generics were available and from discount cards being adjudicated after claims were sent to other insurers in most cases. Patients and their clinicians should recognize that discount cards have mixed impacts on out-of-pocket costs.

Impact of Medicare Part D on mental health treatment and outcomes for dual eligible beneficiaries with HIV.

Depression is common among women with HIV and untreated depression can result in poor quality of life and worsen HIV outcomes. Women with HIV who are dually enrolled in Medicaid and Medicare faced a potential disruption in medication access when Medicare Part D was implemented in 2006. The goal of this study was to estimate the effects of Medicare Part D implementation on antidepressant use, depressive symptoms, and hospitalization in Medicaid-Medicare dual eligible women with HIV. This study used 2003-2008 data from the Women's Interagency HIV Study. The effects of Medicare Part D were estimated using a difference-in-differences approach, adjusting for temporal trends using a matched control group of Medicaid-only enrollees. Before Medicare Part D implementation, dual eligibles differed from Medicaid-only enrollees in antidepressant use and hospitalization, despite having identical prescription drug coverage through Medicaid. For dual enrollees, the transition to Medicare Part D was not associated with changes in antidepressant use, depressive symptoms, or hospitalization. We did not find disruptive effects on antidepressant use and related outcomes among dual eligibles in this study. Stable antidepressant use may be due to better access to medical care for dual eligibles through Medicare both before and after Medicare Part D implementation, which may have eclipsed any effects of the transition. It may also signal that classification of antidepressants as a protected drug class under Medicare Part D was effective in preventing psychiatric medication disruption.

The impact of pharmaceutical marketing on market access, treatment coverage, pricing, and social welfare.

Pharmaceutical spending in the United States, Canada, and the EU is growing. Public payers cover a large portion of these costs and have responded by instituting various pricing and access policies to limit their expenditure. One challenge that public payers face is additional demand induced by a manufacturer's marketing effort. We use a game theoretic approach to study the impact of pharmaceutical marketing on six practical pricing and access policies: negotiated pricing, open pricing, controlled pricing, a listing process, a risk-sharing arrangement, and a value-based pricing with risk-sharing arrangement. We find that all non-value-based policies result in either restricted access or suboptimal treatment coverage. We find that marketing is the highest in the first-best setting where all decisions are made by a social planner. We also find that the value-based pricing with risk-sharing arrangement is preferred by the manufacturer and from a societal perspective whereas no policy is universally preferred by a health care payer. A value-based pricing with risk-sharing arrangement always results in zero net monetary benefit for a health care payer. Therefore, considering non-value-based arrangements, we find that a negotiated pricing policy, a controlled pricing policy, or a risk-sharing arrangement may be socially preferred.

Evaluation of the economic and clinical impact of community pharmacist-driven pharmacy benefit management services.

OBJECTIVE: To evaluate the economic and clinical impact of community pharmacist-led pharmacy benefit management (PBM) services. SETTING: Independent community pharmacy in western North Carolina. PRACTICE DESCRIPTION: Sona Benefits is a PBM partner to self-funded plans in western North Carolina. The services provided by Sona Benefits are led by pharmacists at its affiliate company, Sona Pharmacy + Clinic. PRACTICE INNOVATION: In October 2016, Sona Benefits began providing PBM services to members employed by a local continuing care retirement community. EVALUATION: Economic outcome measures included change in total medical and prescription costs per member per year (PMPY) and change in cost per prescription from baseline. Change in clinical outcome measures (hemoglobin A1C, weight, blood pressure) was assessed for members who participated in 2 or more quarterly health coaching sessions. RESULTS: Prescription costs were reduced from $1219.72 to $858.57 PMPY and medical health care costs were reduced from $5910.76 to $4290.30 PMPY from baseline. This represented a total decrease of $1981.61 PMPY in health care costs. A reduction in the average cost per prescription from $95.10 to $61.88 was observed. For patients enrolled and active in health coaching, we observed reductions in weight, hemoglobin A1C, and blood pressure. Between the initial and final health coaching visits, average weight decreased from 204.6 lb (92.8 kg) to 203.6 lb (92.4 kg), the percentage of patients at hemoglobin A1C goal increased from 47% to 53%, and percentage of patients at goal for blood pressure increased from 58% to 78%. CONCLUSION: Inclusion of community pharmacists in PBM service delivery produced economic benefits for plan sponsors. Preliminary clinical data suggested benefits of pharmacist-led health coaching services, but further evaluation is needed to determine the long-term impact.

Implementing a pharmacist-led in-home medication coaching service via community-based partnerships.

OBJECTIVES: To describe one independent pharmacy group's experience delivering and being reimbursed for in-home medication coaching, or home visits, to high-risk and high-complexity community-dwelling patients. SETTING: A nondispensing clinical division of an independent community pharmacy in Seattle, Washington. PRACTICE INNOVATION: A community pharmacist-led in-home medication coaching program delivered through partnerships with 3 community-based organizations for referrals and payment over a 4.5-year period. Community-based partners included a state comprehensive care management program, a local health system's cardiology clinic, and the local Area Agency on Aging. EVALUATION: A retrospective analysis of patient demographics, drug therapy problems, interventions, and pharmacy and technician time was conducted with the use of the pharmacy's internal patient care documentation and billing systems from January 1, 2012, to June 31, 2016. RESULTS: A total of 462 home visits (142 initial, 320 follow-up) were conducted with 142 patients. Patients averaged 13 disease states (range 3-31) and 16 medications (range 1-44) at their initial visit. Pharmacists identified an average of 11 drug therapy problems per patient (range 1-36) and performed an average of 13 interventions per patient (range 1-48). The most common drug therapy problem identified was nonadherence, and the most common intervention performed was education. The median pharmacist time in the home was 1.5 hours (range 0.67-2.75) for an initial visit and 1 hour (range 0.08-2.25) for a follow-up visit. CONCLUSION: Home visits can be successfully implemented by community pharmacists to provide care to high-risk and high-complexity community-dwelling patients. Our experience may inform other community pharmacy organizations looking to develop similar home visit services.

"Getting to the Table": Changing Ideas about Public and Patient Involvement in Canadian Drug Assessment.

CONTEXT: Involving patients and the public in health policy may contribute to legitimacy and accountability. However, tensions may arise between paradigms of scientific-evidence-based decision making and new ideas valuing inclusivity and patient experience when evaluating and allocating health resources. This article asks whether 10 years of experience with public and patient involvement in Canadian drug assessment has affected participants' ideas about how it works. METHODS: The author surveyed the ideas of participants in the drug assessment process (members of expert committees, officials, and patient groups) as described in reports and hearings in 2005, 2007, and 2012 and conducted interviews in 2014 and 2016. FINDINGS: The author found some consensus across groups of participants regarding the broad goals of health technology assessment (HTA) and the validity of some form of public and patient involvement. There were also important areas of disagreement and uncertainty about how public and patient involvement should be used in drug assessment and how much impact it has on deliberations and recommendations. Overall, uncertainly about the specific role for public and patient involvement in HTA limits the potential for ideational change among participants. CONCLUSIONS: These findings have implications for evaluation of public and patient involvement, the way we understand ideational change, and practical questions of communicating health resource decisions.

Reference Pricing in Germany: Implications for U.S. Pharmaceutical Purchasing.

Issue: The German health care system resembles that of the United States in important ways ­ it is financed by multiple private payers and relies principally on negotiation rather than regulation to establish prices. New drugs that offer minimal benefits compared with existing alternatives within a therapeutic class are subject to reference pricing; those with incremental benefits are subject to price negotiations. Together, the reference and negotiated pricing systems have held German prices substantially below U.S. equivalents. Goal: To describe the German reference-pricing system and compare it to tiered formularies and consumer cost-sharing in the United States. Methods: Document review and interviews with leaders in payer, policy, and pharmaceutical industry organizations in Germany. Key Findings and Conclusions: The German pharmaceutical pricing system uses modest levels of consumer cost-sharing to influence consumers' choices for drugs with therapeutically equivalent alternatives. Manufacturers are free to set the prices of their products, but insurers will not pay more for a new drug than for its comparators unless it offers an additional clinical benefit. For drugs covered by reference pricing, the insurers' payment maximum is set at a level that ensures sufficient choices of low-priced options. These models offer an alternative to the U.S. system of tiered formularies.

Pharmacy Benefit Managers: Practices, Controversies, and What Lies Ahead.

Issue: Pharmacy benefit managers (PBMs) are responsible for negotiating payment rates for a large share of prescription drugs distributed in the U.S. Recently, policymakers have expressed concern that certain PBMs' business practices may not be consistent with public policy goals to improve the value of pharmaceutical spending. Goal: We sought to explain key controversies related to PBM practices and their roles in driving value in the pharmaceutical market. Methods: Literature review and feedback from top experts on PBM business practices and potential policy solutions. Key Findings and Conclusion: In some cases, PBMs' use of rebates has contributed to high pharmaceutical costs, yet proposed solutions to the rebate controversy--including passing the rebate through to payers or patients--will not on their own reduce overall pharmaceutical spending without other policies that drive toward value. Policymakers seeking to reform pharmaceutical reimbursement beyond the practice of rebates will need to consider these changes in light of the recent mergers between PBMs and insurers and the entry of new market competitors.

Computational health economics for identification of unprofitable health care enrollees.

Health insurers may attempt to design their health plans to attract profitable enrollees while deterring unprofitable ones. Such insurers would not be delivering socially efficient levels of care by providing health plans that maximize societal benefit, but rather intentionally distorting plan benefits to avoid high-cost enrollees, potentially to the detriment of health and efficiency. In this work, we focus on a specific component of health plan design at risk for health insurer distortion in the Health Insurance Marketplaces: the prescription drug formulary. We introduce an ensembled machine learning function to determine whether drug utilization variables are predictive of a new measure of enrollee unprofitability we derive, and thus vulnerable to distortions by insurers. Our implementation also contains a unique application-specific variable selection tool. This study demonstrates that super learning is effective in extracting the relevant signal for this prediction problem, and that a small number of drug variables can be used to identify unprofitable enrollees. The results are both encouraging and concerning. While risk adjustment appears to have been reasonably successful at weakening the relationship between therapeutic-class-specific drug utilization and unprofitability, some classes remain predictive of insurer losses. The vulnerable enrollees whose prescription drug regimens include drugs in these classes may need special protection from regulators in health insurance market design.