Radar on Market Access

Radar On Market Access: COVID-19 Outbreak Could Impact Drug Supply Long-Term

March 19, 2020

Industry experts say the COVID-19 outbreak is unlikely to limit U.S. drug supplies in the short or middle term. However, they tell AIS Health that increased demand for longer-duration stocks of medication from self-isolating patients could strain supplies going forward.

Industry experts say the COVID-19 outbreak is unlikely to limit U.S. drug supplies in the short or middle term. However, they tell AIS Health that increased demand for longer-duration stocks of medication from self-isolating patients could strain supplies going forward.

“We are told at this point that we’re not seeing any [drug] shortages in the marketplace today,” says Kelly McGrail-Pokuta, Prime Therapeutics’ vice president of pharmaceutical trade.

On Feb. 27, FDA Commissioner Stephen Hahn released a statement that said disruptions to the pharmaceutical supply chain have been minimal so far. The statement also said that the FDA was especially focused on 20 manufacturers that are particularly dependent on operations in China, and found that “none of these firms have reported any shortage to date.”

But on March 10, the FDA postponed all inspections of overseas drug manufacturing facilities “through April, effective immediately,” according to another statement released by Hahn.

During a pandemic, the CDC recommends anyone taking prescription medication to manage a chronic condition keep an expanded supply of their medicine on hand. As more people self-isolate, and consumers seek to spend less time in stores and other public places, demand for backup medication is likely to increase.

Mike Schneider, a principal at Avalere Health who previously worked for CVS Caremark, says PBMs and payers will have to rethink their typical posture toward chronic medication as enrollees stock up in anticipation of self-isolation.

“Hopefully, with everything going on related to coronavirus and people wanting to stock up, those quantity limits would be eased or eliminated for the most part for chronic meds,” says Schneider.

The Blue Cross Blue Shield Association’s “network of 36 independent and locally operated” affiliates have all decided to waive prescription refill limits on maintenance medications, according to America’s Health Insurance Plans. Other non-Blues insurers have also taken steps to allow members to refill prescriptions in advance.

Experts say it’s difficult to know whether the drug supply will be affected down the road. Schneider says consumer stockpiling and the FDA’s move to suspend foreign inspections could both make an impact on future supply.

Radar On Market Access: Insurers, Pharma Spar Over Copay Accumulator Provision

March 17, 2020

Health insurers are praising a provision in a recently proposed regulation that gives commercial plans greater leeway to run so-called copay accumulator programs, which prevent drug manufacturer coupons from counting toward patients’ annual deductibles or out-of-pocket cost limits. But the pharmaceutical industry slammed the proposal as “misguided” and liable to prevent patients from getting vital medications.

Health insurers are praising a provision in a recently proposed regulation that gives commercial plans greater leeway to run so-called copay accumulator programs, which prevent drug manufacturer coupons from counting toward patients’ annual deductibles or out-of-pocket cost limits. But the pharmaceutical industry slammed the proposal as “misguided” and liable to prevent patients from getting vital medications.

“I do think these programs are here to stay, and I do think they will continue to grow in terms of the absolute numbers as we head into ’22 and beyond,” Jayson Slotnik, a partner at Health Policy Strategies, LLC., tells AIS Health. From insurers’ point of view, copay accumulator programs help combat the perverse incentives that drug manufacturer coupons create: steering patients to pricey brand-name drugs by obscuring their true cost.

In its 2021 proposed Notice of Benefit and Payment Parameters, CMS clarifies that all non-grandfathered individual and group market health plans “have the flexibility to determine whether to include or exclude coupon amounts from the annual limitation on cost sharing, regardless of whether a generic equivalent is available.”

To America’s Health Insurance Plans, it’s important to allow the use of copay accumulator programs even for drugs that don’t have a generic version in order to spur competition between branded drugs that can treat the same condition. “Drug manufacturers recognize this and spend billions of dollars to dilute the impact of competition by providing coupons for brand drugs that do not have a generic equivalent,” the trade group wrote in its comment letter about the proposed rule.

But the Pharmaceutical Research and Manufacturers of America (PhRMA) sees it very differently.

“It would compromise patients’ ability to adhere to prescribed medicines at a moment when insurance coverage for medicines continues to erode; it would put patient health and financial security in danger; it would run directly counter to the Administration’s stated policy of lowering patient out-of-pocket costs for prescription drugs; and it could undermine the appeal and availability of high-deductible health plans,” PhRMA wrote.

Radar On Market Access: Insurers Deploy Array of Strategies to Manage Asthma

March 12, 2020

While payers have long used telephone-based care management teams to improve outcomes for members with asthma, now they’re also deploying other strategies to fine-tune their outreach to those who are in most need of support, AIS Health reported.

While payers have long used telephone-based care management teams to improve outcomes for members with asthma, now they’re also deploying other strategies to fine-tune their outreach to those who are in most need of support, AIS Health reported.

Every member with asthma should have an asthma action plan, says Karen Meyerson, director of commercial care management at Michigan-based Priority Health. Such a plan, which is completed by a patient’s doctor, should include a medication list, tips on recognizing worsening symptoms and steps for responding in an emergency.

Priority Health members can also use a cost-estimator tool to shop for the lowest-cost drugs. For example, members can use the tool to discover a less-expensive generic drug and a pharmacy where their asthma medications cost less.

Nurses and social workers at EmblemHealth conduct home visits to assess the level of dust and mold in asthma patients’ environments, Richard Dal Col, M.D., the insurer’s chief medical officer, tells AIS Health.

To help promote medication adherence, EmblemHealth charges members who use combination inhalers one copay, instead of two. The insurer also allows a 90-day supply for rescue and maintenance medications; depending on their plan design, members may be able to pay one copay, rather than three.

Blue Shield of California members with asthma can receive a home visit by a nurse or a physician. Phillip Baldi, D.O., lead medical care director at the insurer, says while home visits seem expensive, the insurer’s rates with a company providing home visits is comparable to what it pays for an in-person visit to a doctor’s office. “If we can divert five emergency room visits, we can have 50 home visits,” he tells AIS Health.

The insurer is also evaluating offering select maintenance drugs at lower or no copays for members with asthma.

Radar On Market Access: Florida Saw Strong MA, Individual Results and More Consolidations

March 10, 2020

Florida’s health insurers remain highly profitable as the overall market has grown significantly more concentrated, with companies such as Anthem, Inc. and Florida Blue snapping up numerous smaller HMOs over the past several years, particularly in the Medicare Advantage (MA) space, says the author of a new report on the Florida market.

Florida’s health insurers remain highly profitable as the overall market has grown significantly more concentrated, with companies such as Anthem, Inc. and Florida Blue snapping up numerous smaller HMOs over the past several years, particularly in the Medicare Advantage (MA) space, says the author of a new report on the Florida market.

Independent analyst and consultant Allan Baumgarten, who studies state health care markets, tells AIS Health that he expects consolidation to continue.

“There is a new crop of insurers that started business in 2019, including some new Medicare Advantage plans, plus Bright Health and Oscar [Health Insurance],” Baumgarten says. “I think that the Medicare Advantage plans, if they grow to a certain threshold size — maybe 25,000 enrollees or more — will be targets for acquisition. In fact, I think some of the entrepreneurs that started those new plans [did so] as a build and then sell strategy.”

Baumgarten’s report, which looked at enrollment, profitability and acquisitions in 2018, found that HMOs enjoyed strong profits in 2018 despite enrollment that slipped around 2.2%, mainly as a result of fewer people in Medicaid HMOs.

“For the health plans, two lines of business have been especially profitable — Medicare Advantage, consistently for the past eight years or more, and individual health plans [including exchange coverage] in the past two years,” Baumgarten says.

“The premiums paid to Medicare Advantage plans in Florida are among the highest in the country, which is why health plans are eager to start or acquire Medicare plans here,” the report explains.

Insurers weren’t the only health care players pursuing mergers and acquisitions in 2018, says. Overall, the report spotlights “growing consolidation on both the hospital system and health insurer sides, leading to strong profitability for both hospitals and health plans,” Baumgarten says.

Radar On Market Access: New Generic HIV Drug May Impact PrEP Coverage, Not HIV Coverage

March 5, 2020

A generic version of Truvada coming on the market later this year will affect how payers cover pre-exposure prophylaxis (PrEP), but it will not significantly change how payers cover HIV drugs, experts tell AIS Health.

A generic version of Truvada coming on the market later this year will affect how payers cover pre-exposure prophylaxis (PrEP), but it will not significantly change how payers cover HIV drugs, experts tell AIS Health.

Gilead Sciences, Inc.’s Truvada (emtricitabine/tenofovir disoproxil fumarate) was approved by the FDA in 2004 to treat HIV infection in combination with other antiretroviral drugs. In 2012, it also was approved as the first drug for PrEP. In March 2019, Gilead announced that it had entered into an agreement with Teva Pharmaceutical Industries Ltd. to allow the company to launch its generic version on Sept. 30, 2020.

Payer coverage of PrEP also will be affected by a recommendation from the U.S. Preventive Services Task Force (USPSTF). In 2019, the USPSTF recommended PrEP therapy for those at high risk of HIV acquisition, according to a white paper written by Lynn Nishida, R.Ph., vice president of clinical product and contracting for WithMe Health.

“With the USPSTF recommendation, Medicaid expansion programs and health plans are going to have to cover PrEP without any cost sharing,” says Tim Horn, director of medication access and pricing at the National Alliance of State & Territorial AIDS Directors. Therefore, payers will move toward generic versions.

Dan Mendelson, founder and former CEO of consulting firm Avalere Health, says that whenever a drug goes generic, payers usually have a plan in place to make sure the generic is used. “The more expensive the drug, the more likely that the plan will be comprehensive and aggressive,” he says.

Since HIV is one of the six protected classes in the Medicare Part D program, Part D plans typically cover all HIV products, says Michael Schneider, principal at Avalere Health, as there is little to no rebating in the category. “So, there is really no incentive for the PBMs acting on behalf of their clients, the plans, to do anything in terms of a utilization management standpoint or negotiation standpoint outside of just bringing the generics on formulary.”

Most of the branded HIV products are in the Part D specialty tier, requiring coinsurance, due to their high cost. When a generic comes on the market, plans typically will remove the branded product and then place the generic in the specialty tier or the preferred brand tier depending on the cost of the generic product, he says.

Radar On Market Access: Tenn. Blues’ White Bagging Policy Sees Pushback from Providers

March 3, 2020

BlueCross BlueShield of Tennessee, Inc. has received tremendous pushback from physicians on its decision to implement a policy requiring them to get provider-administered therapies from specialty pharmacies, AIS Health reported.

BlueCross BlueShield of Tennessee, Inc. has received tremendous pushback from physicians on its decision to implement a policy requiring them to get provider-administered therapies from specialty pharmacies, AIS Health reported.

Providers traditionally have acquired therapies they administer through a practice known as buy and bill, by which they will purchase a drug from a wholesaler or distributor, keep it in their office and administer it to patients as needed, submitting a claim to the payer afterwards.

But some payers mandate that providers purchase these drugs through a specialty pharmacy, a practice known as white bagging. This means the provider never takes ownership of the drug, and a patient will pay their copayment or coinsurance to the specialty pharmacy after the physician orders the drug. The specialty pharmacy then delivers the medication directly to the provider.

The Tennessee Blues plan launched a white-bagging program Jan. 1, with a six-month transition period, for self-funded employers who opt into it. But many physicians have spoken out against the new policy, and, most recently, a Feb. 6 letter from eight specialty societies asked the Tennessee Blues plan to reconsider the program altogether.

The writers maintained that “practices currently engaging in the buy-and-bill model operate under thin margins,” which would be eliminated with the implementation of white bagging. They maintained that the results would be a shift in site of care from provider offices to the more expensive hospital setting, boosting costs for both the insurer and its members.

While provider margins would decline, offices’ administrative costs would increase. They also asserted that the policy would result in drug waste since a white-bagged drug is specific to a patient, as opposed to buy and bill, which does not have patient-specific therapies.

Yet according to Bill Sullivan, principal consultant at Specialty Pharmacy Solutions LLC, the contention that specialty pharmacies cannot ensure the proper handling and safe delivery of drugs “is simply false.” He also pointed out that from 2014 to 2018, the average price of provider-administered drugs rose 73%.

In Jan. 8 article on the Tennessee Blues plan’s website, Natalie Tate, Pharm.D., vice president of pharmacy at the Blues plan, said that the policy will apply to about 5,500 of its 3.5 million members. Tate also said that 100 employer groups had opted in to participate, and the plan estimated that they would save approximately 20% on the drugs.