Businesses have been dealing with the
burden of rising health care premiums for many years. However, the good news is that in the past couple of
years, health benefit premiums are no
longer seeing the double-digit increases of
the past decade, and have slowed to a
more manageable single-digit increase,
says Shawn F. Barger, Pharm.D., director
of clinical pharmacy management at
AvMed Health Plans in Gainsville, Fla.
Part of the reason that health benefits
costs have slowed, interestingly enough,
is because of the advances in the pharmaceutical industry.
“Yes, prescription drug costs have skyrocketed, but that is because there are
more advanced therapies that did not exist
10 years ago,” he says. “But the benefit of
these drugs is that they manage to rein in
even more expensive hospitalizations and
physician treatments.”
Smart Business spoke with Barger about
these new trends in health care that may
spell relief for companies that have been
burdened with high health care premiums.
What are some of these drugs and why are
they so expensive?
There are now specialty injectable or
infusion products for diseases that are
increasing quality of life; rheumatoid
arthritis, cancer, asthma, hereditary diseases and diabetes. It is important to note
that prior to these treatments coming out,
many people — particularly those with
rheumatoid arthritis — had a horrible quality of life. These new treatments can stop
the progression of a disease and prevent
the person from having to go on disability.
So, while the treatments are very expensive to produce, they are having a huge
impact on quality of life and the ability for
a person to continue working.
How much do prescriptions drugs account for
in an employer’s health care expenditures?
Roughly 15 percent. While it is not the
majority of total costs, this percentage is
increasing every year. The goal, of course,
is that the more expensive drug therapies will decrease expenses of hospitalizations
and emergency room visits. More companies — both businesses and pharmaceutical companies — are looking at what’s
called ‘pharma-economics,’ in which the
cost of higher drug therapies are offset by
decreased visits to the ER and hospitals.
Is the increased availability of generic drugs
helping to keep costs down?
Yes. The three categories of drugs that
have been in the top five for drug spending
have been statins (for high cholesterol
such as Zocor and Pravachol), selective
serotonin reuptake inhibitors or SSRIs
(anti-depressants such as Prozac and
Zoloft), and proton pump inhibitors (such
as Prilosec for gastroesophageal reflux disease/GERD).
The good news is that these drugs, which
have been brand-only in the past, now have
generics as alternatives to the brand,
which has been a huge help in keeping
costs down.
What are some ways that companies can
work to rein in the costs of health benefits?
It is important for employers to remember, given what we just discussed, that managing prescription costs doesn’t
always mean lowering costs. If employees
are taking their prescriptions the way they
should, the use of prescription medication
will go up. But what might costs be if the
employee did not take the medication?
Would the employee take more time off
because he or she is sick more often?
Would he or she go on disability? Would
visits to the ER increase? The employer
needs to look at the big picture.
The way many companies are dealing
with the rise in pharmacy costs is to raise
the co-pays to offset the increase in prescription drug spending. But you can only
do that to a certain point until it becomes a
barrier to buying the medication and
employees opt not to buy it — which can
have many negative consequences. Co-pays should not be a barrier to getting
needed medication.
What are some available cost-controlling
tools that won’t jeopardize employee health?
Four major initiatives allow greater
access to medications, which will show
savings in hospitalizations over the long
term.
- 90-day supply of medication at retail
pharmacies instead of just mail-order - Co-pay holidays if members switch to
generics - Development of medication adherence
programs - Removing prior authorizations and quality limits on certain medications
SHAWN F. BARGER, Pharm.D. is the director of clinical pharmacy management at AvMed Health Plans (www.AvMed.org)
based in Gainesville. Reach Barger at (352) 337-8517 or
[email protected].
