Managing specialty drug spend is like going to the gym. Employers may want the best results, but step back from the hard work to get there.
According to a 2016 report by the Pharmacy Benefit Management Institute (PBMI), employers’ top goal for benefit design is managing specialty drug costs.2 (Survey studied commercial groups only.) So, do employers follow through and manage their specialty costs? Yes, sort of. But do employers take advantage of every opportunity to see maximum savings? No, not even close.
The PBMI report2 found that:
- 50 percent of employers don’t use formulary exclusions
- More than 50 percent don’t use step therapy
- 40 percent don’t use care management
- 30 percent don’t use prior authorization
A wake-up call for future sustainability
Managing health care costs is a real issue. More than 25 percent of employer group health care spending is on prescription drugs. More than one-third of that is specialty drug spend. By 2018, half of all drug spend is predicted to be specialty, with a large amount managed through the medical benefit.3 So employers have to take more effective steps to do their part to help keep a health care system that’s sustainable over the long-term.
Removing fear from the vocabulary
To get started, employers need a clear understanding of their drug spend. That will help them create a complete strategy to manage costs across benefits. But that’s a big task — so big that some employers back away from the heavy lifting. We can help. We know that the pharmacy programs that can make the most impact are:
- Utilization management (UM)
- Preferred drug management
- Care management
- Channel management
The tools are familiar. The marketplace has had these tools around for years. They’re not new. But we do something extra when we apply them to specialty medicines. See the next story for examples of what this means when members take specialty drugs.
Taking the leap
Understanding real costs and ways to manage specialty drug spend takes effort, but it can pay off. Let’s work together to help employers understand all the programs they need to effectively manage their specialty drug spend.
To learn more, contact your Prime representative.
1 Source: Forecast based on Prime commercial book of business, 4Q2012
2 PBMII Research Report: Trends In Specialty Drug Management. March 2016. © PBMI. Accessed at: https://www.pbmi.com/shop-category/reports/specialty-drug-benefit-reports
3 Internal Prime analysis, 2015.