Survey Findings Shed Light on Employer Knowledge of Specialty Drug Design Plans

Representatives from the National Pharmaceutical Council (NPC) and Pharmaceutical Strategies Group (PSG) outlined results of a national survey of plan sponsors at the 2022 Asembia Specialty Pharmacy Summit in Las Vegas, Nevada.

The report, “Trends in Specialty Benefit Drug Design,” conducted by PSG in late 2021, included survey findings from 171 benefits leaders, representing an estimated 41.1 million covered lives. All participants offered specialty drug coverage to the pharmacy and medical benefits, while 80% of the surveyed population self-insured both pharmacy and medical benefits, explained Sharon Phares, PhD, MPH, chief scientific officer of NPC and author of the report.

When it comes to trends and concerns for plan sponsors in this area, “employers have a ton of competing priorities,” said Michael Lonergan, president of drug management solutions at PSG. Employers also want members to have access to medications, and they want to pay for these medications and make sure that they’re working, Lonergan said.

Concerns regarding inappropriate utilization and waste are top of mind for employers, but oftentimes, accessing information on these metrics can be challenging. Employers “want to be able to synthesize that information and help them make informed decisions about their benefit design or overall program management strategies,” Lonergan added.

Survey findings revealed an increasing use of high-deductible health plans (HDHPs), with 36% of respondents reporting that their largest plan for the 2021 benefit year was an HDHP.

“It really becomes a balancing act,” said panelist Renee Rayburg, vice president of specialty clinical consulting at PSG, whereby employers want to offer good benefits to recruit and retain talent but need to find ways to concurrently contain costs.

“There's a little bit of irony—they're worried about reducing patient out-of-pocket costs, but their benefit designs don't necessarily reflect them,” added Lonergan.

With regard to specialty drugs, Phares explained that the most commonly reported tool is cost sharing. In addition, in 2021 51% of plan sponsors said they were using coinsurance for specialty drug cost sharing, marking the first time that metric has surpassed 50%. This is a significant shift from previous utilization of a flat-dollar co-pay.

Coinsurance percentages did vary slightly depending on which benefit the specialty medication is covered under, she noted.

Furthermore, results revealed that more than 90% of plan sponsors used prior authorization step therapy and quantity limits.

“From the employer perspective, I think they’re really set on making sure that there’s a sound clinical prior authorization program,” noted panelist Tracy Spencer, senior vice president and national employer practice leader, employer consulting, at PSG.

Being able to track and accurately report prior authorization approval and denial rates is also important for these sponsors. Two-thirds of respondents said they can access these data, Phares said. The rates are helpful when determining whether utilization management and prior authorizations work, and can also shed light on appeal metrics to make sure drugs are being used appropriately.

Being privy to this information will improve decision-making in the long term, Spencer said. In addition, because newer drugs are continuously brought to market and may be more effective than older drugs, sponsors want to know whether their investments are paying off or if they should switch to newer therapies.

“This results in a better patient experience and a better clinical experience,” said Rayburg.

Findings also showed 12% of plans are carving out utilization management from their pharmacy benefit managers (PBMs), while 13% are considering doing the same, according to Phares.

Half of employers were aware of new-to-market formulary blocks, or formulary restrictions used by PBMs to restrict new products from formulary coverage and reimbursement for a period of time, she explained.

However, lack of consistent industry language in these restrictions marks a challenge for employers. While the drugs are being applied in the block period, sometimes at a very high consistent rate, “when the claim gets paid, they're not being paid to a rate you would expect and then they're being excluded from rebates,” said Lonergan, noting this area provides another opportunity for employer education.

Additional survey findings showed only 25% of participants know a fair amount about biomarker diagnostic testing; 22% had never heard the term before. As precision medicine becomes more common, more robust awareness of these services will be warranted in order to provide coverage options for testing, panelists said.

Citing the example of limited CMS coverage of Biogen’s Alzheimer disease drug aducanumab, situations like these put employers in tough positions where they have to balance out the clinical benefit of new drugs with cost.

At the time of approval “many [employers] were looking more towards the larger organizations and to CMS to see what they were doing. So there was this hesitancy,” explained Rayburg. This factor was complicated by the fact that the drug was initially approved for a broad population, then later limited to a smaller number of patients.

Overall, employers are being more conservative in similar situations and are really seeking more information to make short- and long-term coverage decisions, Lonergan said.

To get this information on the Alzheimer drug, employers primarily turned to PBM teams and benefits consultants, according to survey findings.

Noting every player in this process likely has biases—from the providers, to the payers, to the manufacturers—Lonergan stressed the importance for employers to gather clinical and outcomes data from multiple sources.