Challenge #4: Controlling rising specialty drug costs
Sixteen percent of survey respondents say addressing rising pharmaceutical costs is their top challenge. Overall, regarding what will have the biggest impact on controlling rising specialty drug costs, 32% of survey participants say government interference. That’s about the same response as 2016, which was 33%. Other top responses included utilization management (19%); integrated pharmacy and medical benefits (17%); and cost-effective pharmacy plan design (16%). Those percentages were similar to last year, at 20%, 18%, and 15% respectively.
A proliferation of specialty drugs came to market in recent years, giving rise to many new high-profile treatments for complex health conditions, Hafner says. In some cases, new treatments for conditions that had none previously. These drugs often cost five or six figures, and account for an increasingly large portion of total pharmaceutical spend. They also represent nearly half of the new drugs currently in development.
Less than 5% of insureds use specialty pharmacy benefits, Yeazel says, but it is estimated that they will account for 50% of all drug spending by 2018. These drugs treat complex, chronic conditions such as certain types of cancer, hepatitis C, rheumatoid arthritis, and multiple sclerosis.
While healthcare systems are increasingly impacted by the rising costs of drugs, health plans are even more exposed. “They are struggling with the balance between providing patient choice to innovative cures and an increasing number of drugs that are simply not cost effective compared to existing treatments,” says Hunter Sinclair, senior engagement manager, Consulting, Advisory Board.