Specialty Drugs: Higher Patient Cost Sharing and Prior Auths Linked to Abandoned Meds, Treatment Delays

A recent review adds further support for initiatives that reduce patient costs for specialty drugs. The review found that higher levels of patient cost sharing reduce the utilization of specialty drugs, while programs that lower patient costs increase treatment initiation and adherence. The review, published in the Journal of Managed Care + Specialty Pharmacy, also found that patient cost sharing above $100 was associated with an abandonment rate of up to 75% for some specialty drugs.

Specialty drug expenditures are rising in the United States, with an estimated $301 billion spent on specialty drugs in 2021. Specialty drugs are a category of medications identified by their high costs and requirements for special manufacturing, distribution, or handling. They are typically prescribed to treat or manage relatively rare conditions, including some cancer or autoimmune conditions such as multiple sclerosis.

For instance, in 2023, the Centers for Medicare and Medicaid Services (CMS) defines specialty drugs using a specialty-tier cost threshold of $830 per 30-day equivalent ingredient cost.

Payers attempt to limit specialty drug costs with utilization management strategies, such as categorizing these drugs in a separate tier with higher out-of-pocket copays or coinsurance (patient cost sharing).

Another utilization management strategy is prior authorization (PA), the requirement for patients to request approval and provide documentation from their healthcare provider before a drug may be covered. An estimated 7% of all prescription claims get rejected due to PA requirements, 37% of which end up being abandoned, according to the 2020 Medication Access Report. Prior authorizations are linked to significant delays in medication initiation.

“In our review, we focused on describing the available evidence on the association between cost sharing and utilization of specialty drugs,” Wesam Ismail, M.Sc., researcher at the University of Iowa and the study’s first author, told Formulary Watch. The review’s senior author, Julie Urmie, PhD, is an associate professor at the University of Iowa College of Pharmacy.

Ismail and his colleagues included 44 studies in their literature review, with nine on PA and 35 on cost sharing. The effects of PA on specialty drug utilization varied, with significant delays in prescription initiation often reported.

“Specialty drug use decreased due to higher patient cost sharing, mainly because patients abandoned their medication. At the same time, medication initiation and persistence also decreased,” Ismail noted regarding the findings of their analysis.

On the other hand, programs that reduced patient cost sharing increased medication initiation and persistence.

“The impact of patient cost sharing on medication possession ratio (MPR) and proportion of days covered (PDC) was inconsistent and bidirectional,” Ismail explained. He said that MPR and PDC of cancer specialty drugs did not decrease with higher costs.

“While we expected to see some impact, the extent of the effect was surprising. It is our belief that cancer patients adhere to their medication regimen, regardless of the price, due to the critical importance of these drugs for their survival,” Ismail said.

One limitation the researchers faced is that different authors measured the same outcome in different ways, such as defining the period of medication initiation.

Ismail stated that further research is needed to learn about the impact of utilization management strategies on long-term health outcomes.