Four factors that can help employers lower pharmacy costs for their employees
Pharmacy is 20% of all health care costs nationally, and the cost of prescription drugs continues to rise. Your insurer may be a great partner to help lead you to lower costs for you and your employees. Here are a few ways:
Given that 95% of pharmacy costs are a result of chronic and complex conditions, many insurance companies are providing care management services to help employees work on personal health, including ways to manage or treat chronic conditions and recover from recent accidents or operations. Employees can speak directly to their care manager to establish and engage in personal health goals, which can include anything from weight loss to diabetes management.
Medication therapy management
For employees on three or more prescription medications, some insurance companies are working with pharmacists to help verify the need for each drug and ensure members are getting the lowest cost option on drugs. A simple 30-minute talk with a pharmacist can save employees hundreds each year. The medication therapy management program at Priority Health takes minutes (generally no more than 30 total) and can be done in-person or over the phone.
Cost transparency tools
Knowing there’s a lower-cost generic or preferred drug can save members a lot of money on their medications. Some insurance companies offer members transparency tools to help them see prescription medication options and costs. Priority Health’s Cost Estimator lets employees search the medications they’re prescribed and offers an estimated cost, as well as any possible lower-cost solutions. To date, it’s helped collective membership save more than $9 million. Priority Health also offers a transparency tool for providers to use in real time with patients so they can prescribe lower-cost alternatives when available. Ask your health insurer how they’re empowering your employees and their providers with transparency tools that help everyone save money.
Member and provider transparency tools are cutting edge, but the near future may hold even more innovations to help cure the rising cost of prescription drugs. A growing trend is in biosimilar medications, or biosimilars, which is a nearly identical copy of an original drug. There currently are 18 FDA-approved biosimilars in the market, and that number is expected to grow. Many of these can replace costly, complex and even specialty medications used to treat cancers, multiple sclerosis and more. So far, the cost of biosimilars is anywhere from 15%-30% lower than their original counterparts, which ultimately leads to lower premiums.
To help mitigate the cost of prescriptions, insurers are learning how to lower the need for them in the first place. Population health is a hot topic that considers social determinants and their impact on things like chronic illness, obesity and addiction. As insurance companies continue to learn more about the nature of why members develop illnesses that warrant costly drugs, they may learn to control the need — and the cost — in the future.
Between health management, transparency tools and future advancements, there are ways to help cut the costly trajectory of medications. Ask your insurer if there are any immediate offerings available to you or your employees, and keep the conversation open between you and your insurance representative as you strive for affordable health care.
Christina Barrington, doctor of pharmacy, is vice president of pharmacy programs at Priority Health with over 20 years of managed care experience. Dr. Barrington has conducted extensive research into the impact of value-based benefit designs and is a pioneer in risk-based contracting strategies.