Cost sharing can discourage adherence in chronically ill

August 1, 2007

NATIONAL REPORTS-For chronically ill patients, increased cost sharing can be associated with lower rates of drug treatment, less adherence among existing users and more frequent d iscontinuation of therapy, according to research published in a recent issue of the Journal of the American Medical Assn.

NATIONAL REPORTS-For chronically ill patients, increased cost sharing can be associated with lower rates of drug treatment, less adherence among existing users and more frequent d iscontinuation of therapy, according to research published in a recent issue of the Journal of the American Medical Assn.

Researchers from RAND Health's Bing Center on Health Economics in Santa Monica, Calif., analyzed cost-sharing features of prescription drug plan cost-containment measures such as copayments, coinsurance and monthly prescription limits, and outcomes, UPI reports.

"For patients with certain chronic illnesses, increasing cost-sharing for prescriptions triggers more hospitalizations and more use of emergency departments," says Dana Goldman, head of health economics at RAND and the study's lead author. "The challenge for public and private plans is to make patients more sensitive to the cost of treatment without encouraging them to forgo cost-effective care."

"Even a small impact on those costs can have a significant impact on underwriting gains-or losses-and also influence the competitiveness of their premium costs in a competitive healthcare marketplace," Borden says.

Because of the transient nature of an MCO's member population, careful design of programs and selection of members to participate in the initiatives is required in order to realize a return on investment, he says.

"Reducing copays for key therapeutic classes of drugs and/or types of drugs [e.g. generics] to increase compliance would be a likely element of this type of program," he says.

The good news is that recent initiatives of this nature have demonstrated short-term ROI as well as ongoing ROI for well-designed programs.

"MCOs should not be overly concerned about the increase in drug spend under this type of program if the other program elements have been established correctly. For self-insured plans administered by MCOs under an administrative services agreement, the issue also can be very relevant," he says.

Self-insured plan sponsors are anxious to reign in escalating costs and are looking for MCOs to partner with to address these complex issues.

"MCOs must demonstrate-either through their own capabilities or increasingly through strategic partnerships-the ability to help plan sponsors identify those members in their population with chronic disease or at high risk of developing chronic disease," Borden says. "They must also work with plan sponsors to design and administer custom programs to address the specific cost drivers and issues inherent in that population that will result in better adherence to treatment guidelines and medication treatment regimens."

Additionally, MCOs should develop capabilities to help plan sponsors aggregate clinical, pharmacy, professional and other data from a variety of sources to understand their population and the critical issues driving their healthcare costs as well as measure the effectiveness of interventions.

Experts agree, and it has been well documented, that failure to adhere to medication treatment regimens leads to significantly higher total healthcare spend for member populations who suffer from chronic health conditions.

Borden points out that other studies have further determined that these same members not only cost their employers significantly more in healthcare costs, but have a total cost impact of several times that amount when the cost of absenteeism and presenteeism is factored into the total cost equation-due to lower productivity, poorer quality and customer service, impact on other workers, etc.

"There are many factors that influence members' compliance with medication treatment regimens, including depression, mental impairment, side effects, perceived benefit of treatment, failure to understand the severity of their disease [e.g. asymptomatic disease states], failure to understand treatment protocols, inadequate support and follow through," Borden says.

However, one of the greatest predictors of medication compliance is member cost. "There is a direct correlation between member cost and utilization. In other words, higher member cost-sharing leads to lower utilization and vice versa," Borden says.