5 Findings From the July 2019 Issue of AJMC®

The July issue of The American Journal of Managed Care^® featured research on co-pay accumulator adjustment programs (CAAPs), heroin overdoses among the insured, and potential savings from steering patients to lower-priced services, among other topics. Here are 5 findings from research published in the issue.

1. Opportunities for significant cost savings from steering patients to lower-priced providers

An analysis of claims from California commercial plan enrollees revealed the extent to which prices for 2 outpatient services vary within markets and how much money could be saved if all patients shifted to the provider with the median price in their market. As the authors explained, the 3 services—laboratory tests, imaging services, and durable medical equipment (DME)—are nonemergent and shoppable, especially because they do not require patients to switch primary care providers.

They determined that laboratory tests had the highest within-market price variation and that about half of services in each category were billed by providers with above-median prices for their market. Switching those patients to median-priced providers could save 42%, 45%, and 15% of spending on laboratory tests, imaging services, and DME, respectively, representing an avenue that “could generate substantial healthcare savings,” the researchers wrote.

2. Prices for generic drugs increase, even as more competitors enter the market

Investigators evaluated both wholesale acquisition costs and counts of pharmacy claims for generic drugs from 2005 to 2016 and found that price changes increased abruptly after 2010, with drugs supplied by 4 to 7 manufacturers experiencing increases the same as or higher than those supplied by 1 to 3. For instance, in 2014 price changes were 24%, 28%, and 15% for drugs supplied by 1 to 3, 4 to 7, and more than 7 manufacturers, respectively.

These findings are concerning, wrote the authors, as these price increases are now affecting widely used multisource drugs, not just single-source drugs for rare diseases, indicating that prices are becoming less responsive to competition. “Our results signal market failures in the generic drug market and warrant the consideration of policy strategies to increase the sensitivity of generic drug prices to competition,” they concluded.

3. Most insurers balk at joining value-based models, but participants offer lessons learned

In the first 2 years of the Medicare Advantage value-based insurance design (VBID) model test, fewer than 30% of eligible insurers participated, and this descriptive qualitative study aimed to clarify the reasons for their hesitancy, as well as the experiences of those that did join. Researchers found that the most common deterrents to participation were a lack of information on VBID, expected low return on investment, worries about information technology troubles, and model parameters. Participants did report encountering some of these barriers but then overcoming them, and CMS has since made changes to the model that could address some of these hurdles.

To further boost uptake, the study authors suggest that CMS could provide greater in-kind assistance to VBID model participants to ease implementation and should create opportunities for participants to share their experiences. Insurers can learn from current participants and review evaluation results, and they should develop a technology strategy to enable seamless application of the benefit design.

4. Understanding opportunities for intervention before heroin overdose

Despite some encouraging data suggesting that drug overdose death rates may be dropping, the epidemic continues to affect lives nationwide, including individuals with commercial insurance or Medicaid. A retrospective analysis described the characteristics of patients who overdose (fatally or nonfatally) on heroin, including their comorbidities, where they accessed healthcare, and their prescription histories before the overdose.

It found that nearly all insured patients access healthcare services in the 6 months prior to overdose, indicating potential areas of opportunity to introduce prevention efforts in outpatient settings. The authors also noted a disparity in that Medicaid-covered individuals were less likely to receive medication-assisted treatment for opioid use disorder. The high rate of comorbidities and known substance use disorders “emphasizes the importance of coordinated care for all underlying conditions,” they wrote.

5. CAAPs reduce adherence to specialty autoimmune drugs, potentially linked to unanticipated spending

By preventing drugmaker subsidies from counting toward a patient’s deductible, CAAPs have become popular among employers looking to curb spending, but they also present the possibility of patients experiencing a sharp spike in drug costs when subsidy limits are reached but before they reach the deductible. This retrospective cohort analysis looked at whether CAAP implementation affects autoimmune drug adherence, and it found that monthly mean fills and proportion of days covered did decrease after the CAAP, while treatment discontinuation rates increased.

These findings caused the authors to question the appropriateness of CAAPs, especially as lower drug adherence may actually result in higher long-term medical spending. They called for further research into the effects of CAAPS on healthcare utilization and outcomes, and they suggested that wage-based employer benefits subsidies or co-pay support may help alleviate the burden on patients if these concerns are confirmed.