Employers scramble over skyrocketing specialty drug costs: Nick Otto Employee Benefit News Aug 2016

Posted on in General

Large employers are expecting healthcare costs to remain steady going into 2017, but many are looking to take a number of cost-controlling measures to combat increasing specialty pharma costs.

“Controlling health benefits costs remain a high priority for large employers,” says Brian Marcotte, president and CEO of the National Business Group on Health.

“While employers have been able to keep increases in check for the past few years, costs are still running at more than twice the rate of inflation and general wage increases, thereby threatening affordability.”

For the first time in NBGH’s annual survey, a majority of employers are considering specialty pharma to be the highest driver in health costs, even though specialty pharma only affects 2%- 4% of the population.

“Specialty pharma are very expensive medications, and typically come with challenging administrations and require intense patient monitoring,” Marcotte says. “They are expensive, they are complex and, when we look at trends for 2017, a lot of that is driven by pipeline and new breakthrough medications,” he says. Pipeline treatments include hemophilia, MS, oncology, muscular dystrophy, asthma and diabetes.

Employers are expecting to take a harder look at specialty drug management techniques to help curb rising costs.

Some steps include:

· A more aggressive utilization of management protocols, 74%
· Medications must be obtained through specialty pharmacies, 69%
· Pharmacy plan designs will include a specialty tier, 38%

“[Employers] are also looking at more tools to help navigate the delivery system and support the management of [employee] conditions,” Marcotte adds.

There are some great tools out there, he adds, but it’s getting employees to use them that remain a challenge.

  • Telehealth services are spiking, with nine in 10 employers making mobile services available to employees in the coming year, a dramatic increase from 70% this year.
  • By 2019, Marcotte expects telehealth options to be available by virtually all employers.