Managed Care


Use of multitier benefit designs increases

MANAGED CARE November 2008. © MediMedia USA
The Formulary Files

Use of multitier benefit designs increases

MANAGED CARE November 2008. ©MediMedia USA

Three tiers or four tiers are the drug benefit designs of choice among employers looking to rein in costs, according to findings presented in the Pharmacy Benefit Management Institute’s Pharmacy Benefit Cost and Plan Design Report. From 2007 to 2008, the percentage of employers who implemented a three-tier plan design with copayments rose from 45.3 percent to 60.5 percent. Overall, more than 75 percent of employers use plan designs with two or more tiers.

Health plans can use the report “to see what types of drug benefit programs employers are implementing in terms of cost sharing and utilization management,” says Dana H. Felthouse, MBA, PBMI president. “They can use the information in their product development. They can also look at utilization, average costs, and average rebates to see how their customers compare to national averages,”

These designs have allowed employers to keep their rate of drug cost increases “to an average of 4.86 percent, the lowest rate since 1995,” says Felthouse. “This is a decline of 2 percent from last year’s survey.”

The survey also shows increases in both retail and mail copayments for generic drugs, preferred brands, and nonpreferred brands.

Source: Pharmacy Benefit Management Institute. Prescription Drug Benefit Cost and Plan Design Report. 2008–2009 edition.


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