Drug Benefits

New Solutions to Finance High-Cost Treatments May Raise New Questions

September 16, 2019

With concerns mounting about how health plan sponsors will pay for breakthrough treatments with ultra-high price tags, some major insurers are offering up new solutions aimed at easing that burden.

Cigna Corp. “appears at the forefront” of initiatives to cope with super-high-cost drugs, as Citi analyst Ralph Giacobbe puts it, given that the firm recently introduced a new solution that would help clients pay for and manage two gene therapies: Luxturna and Zolgensma.

By Leslie Small

With concerns mounting about how health plan sponsors will pay for breakthrough treatments with ultra-high price tags, some major insurers are offering up new solutions aimed at easing that burden.

Cigna Corp. “appears at the forefront” of initiatives to cope with super-high-cost drugs, as Citi analyst Ralph Giacobbe puts it, given that the firm recently introduced a new solution that would help clients pay for and manage two gene therapies: Luxturna and Zolgensma.

Members whose plan sponsors pay a per-member per-month fee for Cigna’s new solution — called Embarc Benefit Protection — will pay nothing out of pocket for Zolgensma or Luxturna if they meet the clinical qualifications to be treated with one of those therapies.

“Employers are looking for solutions like that from their health plan partners and the PBMs,” says Steve Wojcik, vice president of public policy for the National Business Group on Health. However, while offerings like Cigna’s could help employers “smooth out the spikes in expenses,” businesses remain concerned about the overall costs of breakthrough therapies in the pipeline, he notes.

Besides Cigna, other major names in the insurance sector, such as CVS Health Corp.’s Aetna and Anthem, Inc., are working on their own solutions to help cope with high-cost therapies, including annuity-style payment arrangements and value-based contracts.

David Dross, managed pharmacy practice leader at the consulting firm Mercer, says some large, self-insured employers that are concerned about ultra-costly treatments are rethinking their decision to forgo stop-loss coverage.

However, issues can arise if clinical and financial management of a high-cost drug are done separately, he adds. In other words, a plan sponsor may determine that a member qualifies for a high-cost drug, but the stop-loss carrier that’s taking on the financial responsibility may not agree.

Datapoint: Boehringer Ingelheim’s Ofev Scores New Indication

September 12, 2019

The FDA last week approved Boehringer Ingelheim’s Ofev for the treatment of systemic sclerosis-associated interstitial lung disease (SSc-ILD), the second indication for the drug, also known as Nintedanib. For the treatment of idiopathic pulmonary fibriosis, Ofev currently holds preferred status for 4% of all covered lives, growing to 33% with prior authorization and/or step therapy.

The FDA last week approved Boehringer Ingelheim’s Ofev for the treatment of systemic sclerosis-associated interstitial lung disease (SSc-ILD), the second indication for the drug, also known as Nintedanib. For the treatment of idiopathic pulmonary fibriosis, Ofev currently holds preferred status for 4% of all covered lives, growing to 33% with prior authorization and/or step therapy.

SOURCE: MMIT Analytics, as of 9/10/19

Few Patients Use Obesity Drugs

September 6, 2019

While about 38% of U.S. adults are obese, and the FDA has approved nine drugs to help treat obesity, relatively few people — about 660,000 annually — were estimated to have used an obesity drug between 2012 and 2016, according to a Government Accountability Office (GAO) report released Aug. 9. The GAO noted that coverage of obesity drugs varied across different types of health insurance.

by Jinghong Chen

While about 38% of U.S. adults are obese, and the FDA has approved nine drugs to help treat obesity, relatively few people — about 660,000 annually — were estimated to have used an obesity drug between 2012 and 2016, according to a Government Accountability Office (GAO) report released Aug. 9. The GAO noted that coverage of obesity drugs varied across different types of health insurance. Patients’ out-of-pocket payments made up most of the expenditures for these drugs (68%), while private insurers covered 25%, Medicaid 4% and Medicare 2%. State Medicaid programs or Medicaid managed care plans within states could choose to either cover or exclude obesity medications. In 2016 and 2017, over half of the prescriptions reimbursed under Medicaid were for the genetic obesity drug Phentermine.

NOTES: The Medicaid amount reimbursed includes state and federal reimbursement and dispensing fees. These amounts do not include all Medicaid spending for obesity drugs under Medicaid managed care — because managed care organizations can be paid for the drugs as part of their capitated payment for all Medicaid services, they are not reimbursed on a per-drug basis, and their payment amounts are not recorded as amounts reimbursed in CMS’s Medicaid State Drug Utilization data. The number of prescriptions reimbursed includes 144 prescriptions for obesity drugs that showed zero dollar amounts for Medicaid reimbursement in CMS’s Medicaid State Drug Utilization data.

SOURCE: U.S. Government Accountability Office, “Few Adults Used Prescription Drugs for Weight Loss and Insurance Coverage Varied.” Visit https://www.gao.gov/assets/710/700815.pdf.

Pediatric Managed Medicaid ACO Leverages Pharmacists to Improve Care

September 3, 2019

For a pediatric accountable care organization (ACO) that contracts with Ohio’s Medicaid managed care plans, improving care for children would be a much more difficult job without the expertise of pharmacists who understand the unique needs of those patients.

“Our MCO partners are often really well versed in the adult patient population and chronic diseases that afflict their adult patients — but sometimes the pediatric population’s chronic conditions are different,” Brigid Groves, a clinical pharmacist specializing in population health at Columbus-based Nationwide Children’s Hospital, tells AIS Health.

By Leslie Small

For a pediatric accountable care organization (ACO) that contracts with Ohio’s Medicaid managed care plans, improving care for children would be a much more difficult job without the expertise of pharmacists who understand the unique needs of those patients.

“Our MCO partners are often really well versed in the adult patient population and chronic diseases that afflict their adult patients — but sometimes the pediatric population’s chronic conditions are different,” Brigid Groves, a clinical pharmacist specializing in population health at Columbus-based Nationwide Children’s Hospital, tells AIS Health.

Groves is one of two pharmacists employed by Partners for Kids (PFK), the ACO affiliated with Nationwide Children’s Hospital that receives capitated payments from the state’s five MCOs to manage care for 330,000 children in central and southeastern Ohio.

As an example of how PFK pharmacists intervened to advocate for pediatric patients, Groves points to when the manufacturer of one type of inhaler shifted to a new, non-child-friendly delivery mechanism for the steroid that’s dispensed by the device.

“MCO plans were just kind of like, ‘great new product, put it on there’ [their formularies]. And it really impacted a lot of our kids because they weren’t able to get their steroid inhalers or use them appropriately,” she says. But PFK’s pharmacists explained the situation, and “our plans were then able to make appropriate changes on their formularies.”

One of the MCOs that contracts with PFK, CareSource, is currently making changes to how it covers the immunosuppressive drug Remicade (infliximab), and “we’ve worked with Partners for Kids pharmacists on our clinical criteria for prior authorization with pediatric use of that medication,” adds Nicholas Trego, Pharm.D., associate vice president of pharmacy for the insurer’s Ohio market.

Large Employers Are Concerned About Million-Dollar Treatments

August 26, 2019

For large, self-insured U.S. employers, their No. 1 concern related to pharmacy benefits is how to finance treatments that come with seven-figure price tags.

That’s one finding of the National Business Group on Health (NBGH) 2020 Large Employers’ Health Care Strategy and Plan Design Survey. Among the 147 employer respondents, 86% said they were either concerned or very concerned about “the impact of million-dollar treatments getting approved by the FDA.”

By Leslie Small

For large, self-insured U.S. employers, their No. 1 concern related to pharmacy benefits is how to finance treatments that come with seven-figure price tags.

That’s one finding of the National Business Group on Health (NBGH) 2020 Large Employers’ Health Care Strategy and Plan Design Survey. Among the 147 employer respondents, 86% said they were either concerned or very concerned about “the impact of million-dollar treatments getting approved by the FDA.”

“The pipeline is looming — there are an estimated 14 new therapies in excess of $1 million each that are on the docket for FDA approval in the coming months and years,” Ellen Kelsay, NBGH’s chief strategy officer, said at a press briefing in Washington, D.C.

Nearly a quarter of large employers polled said that as of 2019, they are delaying the inclusion of newly launched treatments from their formulary to enable their PBM or health plan to better determine the treatment’s efficacy and safety, the NBGH survey noted.

Kelsay also highlighted the fact that 46% of employer respondents in the 2020 survey indicated they would consider a role for government in helping to negotiate prices for high-cost therapies.

“I think that’s a reflection of the frustration employers have” with how to finance high-cost treatments, NBGH President and CEO Brian Marcotte said at the briefing. “It’s not a question of are these good therapies. It’s a question of what can society afford — not just what can employers afford.”

When it comes to specialty drug management, the most notable area of growth is in the use of prior authorization (PA) for medications billed under the medical benefit. The share of employers using PA for drugs under the medical benefit rose from 36% in 2019 to 59% in 2020.

Datapoint: New Narcolepsy Drug to Compete With Xyrem

August 22, 2019

Harmony Biosciences last week won its first-ever FDA approval for its narcolepsy drug Wakix. The drug will be a direct competitor to Jazz Pharmaceuticals’ Xyrem, which currently holds preferred status in the pharmacy benefit for 11% of covered lives, growing to 23% with prior authorization and/or step therapy.

Harmony Biosciences last week won its first-ever FDA approval for its narcolepsy drug Wakix. The drug will be a direct competitor to Jazz Pharmaceuticals’ Xyrem, which currently holds preferred status in the pharmacy benefit for 11% of covered lives, growing to 23% with prior authorization and/or step therapy.

SOURCE: MMIT Analytics, as of 8/20/19