Article
Study Commissioned by CVS Caremark Highlights Opportunities to Significantly Reduce Spending on Costly Specialty Medications
Specialty medications present a challenge for payers as costs for these expensive drugs consume an increasing portion of overall health care spending. In fact, specialty pharmacy spend is expected to rise from $92 billion in 2012 to $235 billion by 2018.
Specialty medications present a challenge for payers as costs for these expensive drugs consume an increasing portion of overall health care spending. In fact, specialty pharmacy spend is expected to rise from $92 billion in 2012 to $235 billion by 2018. According to a new Milliman report commissioned by CVS Caremark, implementing an effective "channel transition" approach -- the process of moving prescriptions from the medical benefit to the pharmacy benefit -- can produce significant savings for health care payers by improving management of these complex and costly drugs.
The report finds the transition from the medical to the pharmacy benefit can save payers an average of 19 percent across 14 classes of self- or provider-administered injectable specialty drugs for the treatment of conditions such as multiple sclerosis and autoimmune disorders. By moving coverage to the pharmacy benefit, payers are able to implement more effective management tools such as formulary design, utilization management, and preferred or exclusive networks. According to the report, more than half (53 percent) of specialty medication spending currently occurs under the medical benefit.
"With the continued rise in utilization and spend related to specialty medications, health care payers have a tremendous opportunity to reduce costs and improve care through a variety of approaches," said Alan Lotvin, M.D., executive vice president of Specialty Pharmacy for CVS Caremark.
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Source: Wall Street Journal
