|
4th Quarter 2008 Executive
Summaries
|
|
|
Before changing plan design to address the problem of rising prescription drug benefit cost, employers must understand and periodically revisit the pharmacy benefit building blocks. Ultimately, aligning all aspects of the pharmacy benefit is the best and only way to help control drug benefit costs and, at the same time, promote greater employee satisfaction. This article describes how the pharmacy benefit building blocks of delivery (dispensing), provider contracting, drug products and benefit design all have to work together to produce a more effective pharmacy benefit program.
Assesing the First Data Bank Setlement: Dramatic Shake-Up or Status Quo?
by Joshua Golden, Hewitt Associates
First DataBank (FDB) is the prescription drug industry’s largest publisher of average wholesale price (AWP) data, which is used to derive drug prices at the consumer end of the U.S. drug distribution system. In 2006, FDB agreed to a tentative legal settlement after allegations it engaged in questionable activities that cost millions of consumers and third-party payers an extra $7 billion between August 2001 and March 2005. The potential
impact of the proposed settlement is projected to be far-reaching; however, settlement details still require final approval by the court.
Ouch! My Employes’ Drug Therapy Costs How Much?
by Michael S. Jacobs, Buck Consultants
In the United States today, most citizens receive their health care through programs sponsored and financed by their employers rather than through primarily government-based funding. With this in mind, 85% of U.S. employer survey respondents indicated their health care programs are an investment in their employees from which they expect a return. With the many new pharmaceutical therapies that have been developed and marketed in this country that treat small populations suffering from rare or previously untreatable diseases such as multiple sclerosis, inflammatory diseases, and treatments for various types of cancer, employers have found themselves in an uncomfortable position. The costs of these pharmaceutical therapies can reach $5,000 per month or more, but the long-term benefits may take decades to assess; even increased survival rates or improvement of symptoms is uncertain in some newer oncology therapies. What steps can employers take to manage the availability of these high-cost therapies so their prescription drug plans continue to provide an acceptable return on investment? Prior authorization, step therapy, wellness programs, case management, drug compliance efforts, drug therapy rationing, transparency and cost-sharing techniques are discussed.
An Ounce Of Prevention: The Potential for Value- Based Pharmacy Benefits in Cost Containment
by John J. Malley, Watson Wyatt Worldwide
A growing number of companies are considering whether they can reduce overall medical costs by improving drug compliance through value-based pharmacy benefit designs. Value-based designs either provide more generous coverage for certain clinically proven drugs, or change cost-sharing or copayment levels for drugs used to treat the employee population’s most widespread and costly chronic medical problems. This article presents employer experiences, identifies important issues for those considering value-based pharmacy benefits and suggests ways to overcome barriers to implementation.
The Drug Cost Gap and the Diagnosis-Prescription Connection
by David Dross, Mercer
Although the rise in pharmacy benefit costs continues to outpace overall medical cost inflation, the gap is narrowing. Employers can improve cost and employee wellness even further with an innovative technique for drug therapy compliance called the Diagnosis-Prescription (Dx-Rx) approach. This article reports results from a 2007 national employer survey on pharmacy benefits and describes how the Dx-Rx innovation can keep patients and their doctors on track when it comes to controlling disease and driving down overall medical costs.
by Dan Coyle, CEBS, Deloitte Consulting LLP
A health savings account (HSA) plan, when properly understood, can be a great tool for managing health care costs for employers. It also can be a great tool for employees who want to save for future medical costs. Unfortunately, most presentations and articles about HSA plans skip the details; and there are many administrative and compliance complexities, as would be expected with any plan that involves a tax break. This article provides ten points human resource (HR) and benefit professionals should know when considering whether to add an HSA plan. In this collective learning curve, the more accurately employers address questions, the happier their employees will be with their new plans.
New Strategies for DB Plan Management
by Rob Vandersanden, Hewitt Associates
Plan sponsors are managing defined benefit (DB) plans in new ways. In particular, the time horizon for sponsors of plans that have been closed and/ or frozen has become shorter. This article will describe a suggested approach to managing pension obligations in the new environment, using two distinct plan sponsor case studies as models.
Full text copies of these articles are available through the INFOSOURCE™ Document Delivery Service. Article reprints are also available in quantities of 100 or more. For information, call the Publications Department at (888) 33-IFEBP. You can order your subscription (reprints and back issues) online. Four issues for $125 (or $95 for CEBS registrants).